SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K 

FOR ANNUAL AND TRANSITION REPORTS PURSUANT TO SECTIONS 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

          (Mark One)

[ X ]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [FEE REQUIRED] FOR THE FISCAL YEAR ENDED DECEMBER 31, 1996
          OR
[   ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED] FOR THE TRANSITION PERIOD FROM          
TO              

COMMISSION FILE NUMBER 1-3920

KINARK CORPORATION 
(Exact name of registrant as specified in its charter)

DELAWARE
(State or other jurisdiction of incorporation or organization)

71-0268502
(I.R.S. Employer Identification No.)

7060 SOUTH YALE, TULSA, OKLAHOMA 74136
(Address of principal executive offices)(Zip Code)

Registrant's telephone number, including area code
(918) 494-0964

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

TITLE OF EACH CLASS   NAME OF EACH EXCHANGE ON WHICH REGISTERED
COMMON STOCK, $.10                AMERICAN STOCK EXCHANGE
PAR VALUE

SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
None

     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        

     Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [  ]

     The aggregate market value of Common Stock held by non-affiliates on March
15, 1997 was approximately $13.0 million.  As of March 15, 1997, there were
6,759,386 shares of Kinark Corporation Common Stock $.10 par value outstanding.

                         Documents Incorporated by Reference

     Portions of the registrant's definitive proxy statement to be filed not
later than 120 days after the end of the fiscal year covered by this report are
incorporated by reference in Part III. 
<PAGE>
FORM 10-K     TABLE OF CONTENTS



Item                                                                      Page

PART I

1.        Business                                                         1
2.        Properties                                                       2
3.        Legal Proceedings                                                3
4.        Submission of Matters to a Vote of Security Holders              3


PART II

5.        Market for Registrant's Common Stock and Related
            Shareholder Matters                                            4
6.        Selected Financial Data                                          4
7.        Management Discussion and Analysis of Financial 
            Condition and Results of Operations                            4
8.        Financial Statements and Supplementary Data                      4
9.        Disagreements on Accounting and Financial Disclosure             4


PART III

10.       Directors and Executive Officers of the Registrant               5
11.       Executive Compensation                                           5
12.       Security Ownership of Certain Beneficial Owners and 
            Management                                                     5
13.       Certain Relationships and Related Transactions                   5


PART IV

14.       Exhibits, Financial Statement Schedules, and Reports 
            on Form 8-K                                                    6


<PAGE>
PART I

ITEM 1.  BUSINESS

     Kinark Corporation is a diversified company conducting business in
Galvanizing and Chemical Storage and Distribution which are further discussed
below.  As used in this report, the terms "Kinark" and "Company" mean Kinark
Corporation (the Registrant) and its operating subsidiaries unless the context
requires otherwise.  Kinark was incorporated under the laws of the State of
Delaware in 1955.  The current operating subsidiaries consist of Boyles
Galvanizing Company ("Boyles"), acquired in 1969, Lake River Corporation ("Lake
River"), acquired in 1968,and North American Galvanizing Company ("NAGC"),
formed in 1996, and the successor by merger to Rogers Galvarizing Company
("Rogers").  Rogers was acquired by the Company during 1996 and subsequently
merged into NAGC.  See "Notes to Consolidated Financial Statements--Acquisition
of Rogers Galvanizing Company."

     In August 1995, the Company adopted a plan to divest its Kinpak, Inc.
("Kinpak") packaging subsidiary.  Kinpak produced proprietary household
cleaning products and provided contract packaging of private label antifreeze
and windshield washer fluid.  Substantially all the Kinpak assets were sold and
certain liabilities assumed by the buyer on February 27, 1996.  See
"Management's Discussion and Analysis of Financial Condition and Results of
Operations."

     Financial information for each continuing business segment including
sales, operating earnings, identifiable assets, capital expenditures, and
depreciation expense for the most recent three fiscal years is presented in the
notes to the consolidated financial statements included in Item 8.

GALVANIZING

     The Company conducts its galvanizing operations through its Boyles and
NAGC operating subsidiaries and is currently conducting all such galvanizing
operations under the tradename "North American Galvanizing Company." 
Accordingly, all references to the galvanizing operations of NAGC in this
report include the combined galvanizing operations of NAGC and Boyles.  The
Company plans to merge Boyles into NAGC during 1997 to consolidate its
galvanizing operating subsidiaries.

     NAGC is principally engaged in hot dip galvanizing of metal products. 
This process provides effective corrosion protection of fabricated steel which
is used in numerous markets such as petrochemical, highway and transportation,
energy, utilities, communications, irrigation, pulp and paper, waste water
treatment, food processing, recreation and original equipment manufacturers. 
NAGC galvanizes products for over 2,000 customers nationwide.

     Based on the number of its operating plants, NAGC is one of the largest
independent hot dip galvanizing companies in the United States.  NAGC
galvanizes iron and steel products by immersing them in molten zinc.  This
process produces an alloyed metal surface which can endure for up to 50 years
with no oxidation or corrosion from exposure to the elements.

     NAGC utilizes a strategically located network of plants to capitalize on
market opportunities and optimize turn-around service to its customers.  Its
galvanizing plants are located in Tulsa, Oklahoma; Kansas City, Missouri; St.
Louis, Missouri; Nashville, Tennessee; Louisville, Kentucky; Denver, Colorado;
Hurst, Texas; and Houston, Texas.  Zinc, the primary raw material in the
galvanizing process, is a widely available commodity in the open market. 
Worldwide spot prices at the beginning of 1996 were $.46 per pound and
increased to $.51 per pound by the end of 1996.  To reduce the impact of zinc
price fluctuations, the Company periodically utilizes long-term fixed price
purchase contracts.  NAGC has a broad customer base with its five largest 
customers, on a combined basis, accounting for 24% of the Company's
consolidated sales in 1996.  The backlog of orders at NAGC is generally nominal
due to the short time requirement involved in the galvanizing process. 
Inventory and working capital requirements have remained relatively stable.

     The galvanizing business is highly competitive.  NAGC competes with other
independent galvanizing companies, captive galvanizing facilities operated by
manufacturers, and alternative forms of corrosion protection such as paint. 
Competition is based primarily on quality of corrosion protection, price and
service.  The strategic location of NAGC's plants and the consistent quality of
its service enable NAGC to compete on a favorable basis.  NAGC employed 453
persons at December 31, 1996.

CHEMICAL STORAGE AND DISTRIBUTION

     Lake River, located in Chicago, is a bulk storage operation with 197 tanks
providing 21 million gallons of on-site bulk liquid storage capacity; another
36 tanks with an aggregate storage capacity of 23 million gallons are
classified in a decommissioned status due to low demand for large capacity
tanks.  In addition, Lake River provides approximately 600,000 square feet of
warehouse capacity and serves as an important link in the chemical distribution
system for various Midwestern markets.  During 1996, Lake River employees
handled 26 barges, 1,326 rail cars, and over 100 transport trucks daily.  Lake
River also operates two bag filling lines used for bulk chemical bagging and
three drum filling lines which handle flammables, caustics, food grade
products, and miscellaneous specialty chemicals.

     Bulk liquid storage facilities are leased to customers for various terms
generally ranging from one to five years.  These contracts are typically
renewed or replaced with other customers upon expiration.  Lake River's storage
contract with its largest customer expired in 1994.  In 1994,  this customer
accounted for 13.2% of the Company's consolidated sales and 32.2% of Lake
River's sales.  Subsequently, Lake River replaced 4.5% of the lost business in
1995 and another 6.4% in 1996.  At the end of 1996, approximately 96% of the
warehouse facilities were committed on multi-year and month-to-month contracts.

     Lake River's facilities provide integrated storage, formulating,
packaging, and distribution services.  Most competitors do not offer this
breadth of services although numerous companies compete aggressively in one or
more of these areas.  Lake River's service-based bulk liquid storage business
does not require it to take title to any of the customer's products that it
handles.  Steel drums and bag containers used in Lake River's production
operations are available in adequate quantities from a number of regional
suppliers.  Location of facilities, quality of service, and price are important
factors enabling Lake River to compete effectively.  Lake River employed 84
persons at December 31, 1996.

     Revenue from bulk liquid storage customers is derived from fixed storage
rentals and from throughput handling fees.  Existing tank capacity is adequate
to support anticipated business growth from new rentals and/or increased
product throughput.  The Company will consider alternatives to increase the
capacity of warehousing, drumming and bagging operations should future growth
warrant expansion in these areas.


ITEM 2. PROPERTIES

     The Company's executive offices are in Tulsa, Oklahoma, with approximately
3,500 square feet of office space leased through June 30, 1997.

     NAGC owns and operates eleven hot dip galvanizing plants located in
Oklahoma, Missouri, Texas, Colorado, Tennessee and Kentucky.  These plants
average 20,000 square feet in size and operate zinc kettles ranging in length
from 33 to 56 feet.

     Lake River has operating facilities located on approximately 50 acres
located on the Chicago Ship Canal in Cook County, Illinois, which is leased
from the Metropolitan Sanitary District of Chicago, a municipal corporation. 
These multiple land leases have terms ranging from 35-75 years, with the
earliest expiring in 1999.  The operating facilities include an office and
quality control laboratory of brick masonry construction containing an area of
approximately 5,100 square feet, 233 specialized tanks with a total capacity of
approximately 44 million gallons of liquid chemicals.  In addition, Lake River
operates 600,000 square feet of public warehousing storage in six southwest
Chicago locations.  Approximately 410,000 square feet of warehouse space is
leased at three locations utilizing multi-year leases which are typically
renewed upon expiration.  Lake River owns the facilities which comprise the
remaining 190,000 square feet of warehouse space.

<PAGE>
ITEM 3. LEGAL PROCEEDINGS

     The Company is not a party to, nor is any of its property subject to, any
material legal proceedings, other than routine litigation incidental to the
business.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     No matters were submitted to a vote of stockholders during the fourth
quarter of 1996.
<PAGE>
PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER MATTERS

STOCK INFORMATION

     The principal trading market for the common stock of Kinark Corporation is
the American Stock Exchange.  The Company's common stock trades under the
symbol "KIN".  The Company has continued a long-term policy of not paying
dividends in order to reinvest earnings to expand its business operations.  The
board of directors may review the dividend policy in the future, recognizing
that dividends may be a desirable form of return on the investment made by many
of its stockholders.  Stockholders of record at March 15, 1997 numbered
approximately 2,400.


                         QUARTERLY STOCK PRICES
               FIRST               SECOND         THIRD               FOURTH

1996-High $    3 5/16    $    4 3/4          $    4 1/4          $    3 7/8
     Low       2 7/16         2 3/8               2 3/4               2 11/16

1995-High      4              3 15/16             3 7/16              3 1/4
     Low       3              2 7/8               2 7/8               2 1/4

ITEM 6.  SELECTED FINANCIAL DATA

     The selected financial data for years 1992 through 1996 are presented on
page FS-21 of this Annual Report on Form 10-K.

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND 
RESULTS OF OPERATIONS

     Indexes to Management's Discussion and Analysis of Financial Condition,
Results of Operations, Financial Statements and Supplementary Data are
presented on page 10 of this Annual Report on Form 10-K.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     Indexes to Management's Discussion and Analysis of Financial Condition and
Results of Operations, Financial Statements and Supplementary Data are
presented on page 10 of this Annual Report on Form 10-K.

ITEM 9.  DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

     There have been no disagreements with the Company's independent
accountants on any matter of accounting principles or practices, financial
statement disclosure, or auditing scope and procedure within the twenty-four
months prior to December 31, 1996.
<PAGE>
PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
          DIRECTORS

     The information required by this item with respect to the Directors of the
Company appears in the 1997 Proxy Statement under the headings "Election of
Directors" and "Compliance with Section 16(a) of the Securities Exchange Act of
1934" and is incorporated by reference.

NAME                AGE  OFFICE AND BUSINESS EXPERIENCE

MICHAEL T. CRIMMINS 57   Chairman of the Board since May 1995 and Chief
                         Executive Officer of the Company since February 1996. 
                         From 1989-1995, Vice President and General Counsel of
                         Northbridge Holdings, Inc. And Deltech Corporation. 
                         Vice President and General Counsel from 1988 until
                         1989 of the Advanced Technology Group of Hoechst
                         Celanese Corporation.  From 1976 until 1987, Assistant
                         Secretary and Associate General Counsel of American
                         Hoechst Corporation.

RONALD J. EVANS     47   President of the Company since February 1996.  From
                         May 1995 through January 1996, private investor.  From
                         1989-1995, Vice President-General Manager of Deltech
                         Corporation.  Mr. Evans' previous experience includes
                         13 years with Hoechst Celanese Corporation.

PAUL R. CHASTAIN    62   Vice President and Chief Financial Officer since
                         February 1996.  From July 1993 through January 1996,
                         President and Chief Executive Officer of the Company. 
                         From June 1991-July 1993, Chairman and Chief Executive
                         Officer.  Co-Chairman and Co-Chief Executive Officer
                         of the Company from June 1990-June 1991.  From 1976 to
                         1990, Executive Vice President and Treasurer of the
                         Company.  From 1973 through 1976, Vice President of
                         Finance and Secretary of the Company.  Mr. Chastain's
                         previous experience includes six years with Allis-
                         Chalmers and nine years with Litton Industries.

ITEM 11.  EXECUTIVE COMPENSATION

     The information required by this item appears in the 1997 Proxy Statement
under the heading "Executive Compensation" and is incorporated by reference

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The information required by this item concerning security ownership of
certain beneficial owners and management appears in the 1997 Proxy Statement
under the heading "Security Ownership of Principal Stockholders and Management"
and is incorporated by reference.
<PAGE>
ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     Joseph J. Morrow, a director of the Company and a nominee for reelection
to the Company's Board of Directors in 1997 for a one-year term, purchased
1,759,083 shares of Common Stock in the Company's private placement in January
1996.  See "Notes to Consolidated Financial Statements--Stockholders' Equity." 
Mr. Morrow is the chief executive officer of Morrow & Co., Inc., which provides
proxy solicitation and other stockholder related services to the Company.  
<PAGE>
PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

(A)  THE FOLLOWING DOCUMENTS ARE FILED AS PART OF THIS REPORT:

     (1)  FINANCIAL STATEMENTS                                        PAGE  

          Independent Auditors' Report                                FS-7
          Consolidated Balance Sheets at December 31, 1996 and 1995   FS-8
          Consolidated Statements of Earnings for the years ended 
             December 31, 1996, 1995 and 1994                         FS-9
          Consolidated Statements of Stockholders' Equity
             for the years ended December 31, 1996, 1995 and 1994     FS-10
          Consolidated Statements of Cash Flows for the years ended 
              December 31, 1996, 1995 and 1994                        FS-11
          Notes to Consolidated Financial Statements                  FS-12

     (2)  FINANCIAL STATEMENT SCHEDULES:

          Schedule II - Valuation and Qualifying Accounts             8

               All schedules omitted are inapplicable or the information
               required is included in either the consolidated financial
               statements or the related notes to the consolidated
               financial statements.

     (3)  EXHIBITS:

               The Exhibits filed with or incorporated into this report
               are listed in the following Index to Exhibits.


EXHIBIT INDEX

EXHIBIT
   NO.                           DESCRIPTION

3.1       Restated Certificate of Incorporation of Kinark Corporation, as
          amended on June 6, 1996 (incorporated by reference to Exhibit 3.1 of
          the Company's Pre-Effective Amendment No. 1 to Registration Statement
          on Form S-3, Registration No. 333-4937, filed with the Commission on
          June 7, 1996).

3.2       Amended and Restated Bylaws of Kinark Corporation (incorporated by
          reference to Exhibit 3.1 to the Company's Quarterly Report on Form
          10-Q dated March 31, 1996). 

10.1      Revolving Credit and Term Loan Agreement dated as of March 24, 1992,
          as amended on October 16, 1992; March 31, 1993; March 31, 1994; March
          31, 1995; and April 1, 1996 by and between Bank of Oklahoma, N.A. and
          Kinark Corporation and subsidiaries (incorporated by reference to
          Exhibit 10.2 to the Company's Annual Report on Form 10-K for the year
          ended December 31, 1993).

21.       Subsidiaries of the Registrant.

23.       Independent Auditors' Consent.

24.01     Power of attorney from Richard C. Butler.

24.02     Power of attorney from Michael T. Crimmins.

24.03     Power of attorney from Ronald J. Evans.

24.04     Power of attorney from Joseph J. Morrow.

24.05     Power of attorney from John H. Sununu.

24.06     Power of attorney from Mark E. Walker.

27        Financial Data Schedule.

(B)  REPORTS ON FORM 8-K.

          The Company filed a Current Report on Form 8-K dated October 28,
          1996 to report, under Item 5 of such report, that the Company
          had reached an agreement to purchase 49 shares of Rogers common
          stock and to clarify certain conditions to the Company's rights
          offering.

<PAGE>
SCHEDULE II

<TABLE>
KINARK CORPORATION
VALUATION AND QUALIFYING ACCOUNTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994

<CAPTION>
                                             Additions
                    Balance atAdditions      charged to          Balance at
                    beginning from           costs and           end of
Description         of year   Acquisition    expenses  Deductionsyear

Allowance for doubtful receivables
(deducted from accounts receivable)

<S>                 <C>       <C>            <C>       <C>       <C>
1996                $162,000  $72,000        $252,000  $59,000(a)$427,000
1995                $ 77,000  ----           $140,000  $55,000(a)$162,000
1994                $ 95,000  ----           $ 46,000  $64,000(a)$77,000


(a)  Accounts written off, less recoveries
</TABLE>

<PAGE>
SIGNATURES

     Pursuant to the requirements of Section 13 and 15(d) of the Securities and
Exchange Act of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned, as duly authorized.

                                             KINARK CORPORATION
                                             (Registrant)

Date: March 31, 1997                         By:  /s/Paul R. Chastain
                                             Paul R. Chastain
                                             Vice President and
                                             Chief Financial Officer


     Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below on March 31, 1997, by the following persons on
behalf of the Registrant and in the capacities indicated.

     /s/Michael T. Crimmins*                 /s/Ronald J. Evans*
     Michael T. Crimmins, Chairman           Ronald J. Evans, President 
     of the Board and Chief Executive             and Director
     Officer
     (Principal Executive Officer)

     /s/Paul R. Chastain                     /s/Richard C. Butler*
     Paul R. Chastain, Vice President,       Richard C. Butler, Director
     Chief Financial Officer and
     Director                                /s/John H. Sununu*
     (Principal Financial and Accounting     John H. Sununu, Director
     Officer)

     /s/Joseph J. Morrow*                    /s/Mark E. Walker*
     Joseph J. Morrow, Director              Mark E. Walker, Director


*Paul R. Chastain, by signing his name hereto, does hereby sign this Annual
Report on Form 10-K on behalf of each of the directors and officers of the
Registrant after whose typed names asterisks appear pursuant to powers of
attorney duly executed by such directors and officers and filed with the
Securities and Exchange Commission as exhibits to this report.


                                        By:  /s/ Paul R. Chastain
                                             Paul R. Chastain
                                             Attorney-in-fact
<PAGE>
INDEX TO MANAGEMENT'S DISCUSSION AND ANALYSIS,
CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA


                                                       Page(s)    

Management's Discussion and Analysis                   FS-1 to FS-6

Independent Auditors' Report                           FS-7

Consolidated Balance Sheets                            FS-8

Consolidated Statements of Earnings                    FS-9

Consolidated Statements of Stockholders' Equity        FS-10

Consolidated Statements of Cash Flows                  FS-11

Notes to Consolidated Financial Statements             FS-12 to FS-17

Segments of Business                                   FS-18

Quarterly Results                                      FS-19

Five-Year Financial Summary                            FS-20
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF 
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

FORWARD LOOKING STATEMENTS OR INFORMATION

     Certain statements contained in this Management Discussion and Analysis
are not based on historical facts, but are forward-looking statements that are
based upon numerous assumptions about future conditions that may ultimately
prove to be inaccurate.  Actual events and results may materially differ from
anticipated results described in such statements.  The Company's ability to
achieve such results is subject to certain risks and uncertainties.  Such risks
and uncertainties include, but are not limited to, product prices, continued
availability of capital and financing, and other factors affecting the
Company's business that may be beyond its control.

RESULTS OF OPERATIONS

     The consolidated statements of earnings provide an overview of Kinark's
operating results for 1994 through 1996.  This section of Management's
Discussion and Analysis summarizes the major factors which influenced operating
results during the three-year period presented.  Revenues and expenses
associated with the Company's previously owned Kinpak packaging subsidiary,
which are presented as discontinued operations, are not included in the
continuing operations analyzed below (see Discontinued Operations Note to the
Consolidated Financial Statements).

REVENUES
                         1996                1995                1994

                    $(000)      %       $(000)      %       $(000)      %

Galvanizing         $38,498    80.9%    $16,984    67.3%    $15,476    59.0%
Chemical Storage &
 Distribution         9,101    19.1%      8,262    32.7%     10,747    41.0%
Total               $47,599   100.0%    $25,246   100.0%    $26,223   100.0%


1996 COMPARED WITH 1995

     Sales for 1996 were a record $47,599,000, an increase of $22,353,000 or
88.5% from 1995.  Approximately 90% of the sales increase was attributable to
the acquisition of Rogers Galvanizing Company ("Rogers") in the first quarter
of 1996, with the remainder due to increased demand experienced by the
galvanizing and chemicals operations.

     Excluding the impact of new sales contributed by Rogers, sales increased
8.6% at the Company's Boyles Galvanizing plants, as they benefitted from a
record volume of galvanized steel structures for the second consecutive year
and another year of slightly improved average selling prices.  New sales from
Rogers more than doubled the Company's 1996 galvanizing sales to $38,498,000,
for an increase of 126.7% over sales of $16,984,000 in 1995.  Measured on a pro
forma basis, the combined galvanizing companies, now operating as North
American Galvanizing Company ("NAGC"), experienced a same plant increase in
sales in 1996 of $5,085,000 or 14.5% from 1995.  The strongest sales gains were
recorded for galvanizing shipments to customers serving the transportation and
communications industries.

     Lake River's sales of $9,101,000 increased 10.2% from 1995 on increased
activity in its three main chemical service sectors.  Bulk liquid storage
revenues increased 10.4% from 1995, due to a 48.6% increase in throughput to
volume of 41,933,000 gallons.  Drum filling revenues increased 2.5% over 1995
on the strength of price increases that offset slightly lower volume. 
Warehousing operations, consisting of 600,000 square feet, increased revenues
13.6% as capacity utilization rose to 96% compared with 85% in 1995. 

1995 COMPARED WITH 1994

     Consolidated sales for 1995 decreased $977,000, or 3.7%, from 1994 due to
lower sales at Lake River.

     Lake River's sales of $8,262,000 were down $2,485,000, or 23.1%, from 1994
due to the loss of its largest customer for bulk liquid storage.  Revenues from
drumming and warehousing increased 15% over 1994, partially offsetting the
decline in storage.  The drumming and warehousing operations accounted for 76%
of Lake River's total sales in 1995, and it is expected to maintain that
relative share for the foreseeable future. 

     Boyles' sales increased $1,508,000, or 9.7%, in 1995 on record volume and
higher pricing.  Boyles galvanized a total of 70,363 tons of steel in 1995,
representing a 9.5% increase in volume over the prior year.  Volume increased
in five of the six regions where Boyles plants are located, with the largest
increase being recorded in the Texas market.  The sales trend has been up at
Boyles for the past two years.

COST AND EXPENSES

                            1996             1995                1994

                              % of                % of                % of
                    $(000)    Sales     $(000)    Sales     $(000)    Sales

Cost of sales       $36,953   77.7%     $20,524    81.3%    $18,999   72.5%
Selling, general &
   administrative     5,198   10.9%       3,766    14.9%      3,619   13.8%
Depreciation &
   amortization       2,347    4.9%       1,471     5.8%      1,469    5.6%
Total               $44,498   93.5%     $25,761   102.0%    $24,087   91.9%


1996 COMPARED WITH 1995

     Cost of sales for 1996 was $36,953,000, an increase of 80%, due to the
increased sales volume from operations and the acquisition of Rogers.  Cost of
sales as a percent of total sales was 77.7% in 1996, compared to 81.3% in 1995. 
Gross profit margins increased primarily as a result of improvement in labor
productivity and the beneficial impact of specialty market segments served by
Rogers.  At Lake River, cost of sales as a percent of sales were unchanged from
1995.

     Selling, general and administrative (SG&A) expenses were $5,198,000 in
1996, an increase of 38% attributable to the acquisition of Rogers.  Excluding
Rogers, SG&A expenses decreased 11.6% to $3,331,000 compared to $3,766,000 in
1995.  SG&A expenses at Lake River were 6.5% of sales compared to 7.1% in 1995. 
As a percent of total sales, SG&A expenses were 10.9% in 1996 compared to 14.9%
and 13.8% in 1995 and 1994, respectively.  Depreciation expense of $2,347,000
in 1996 increased approximately 60% compared with 1995 and 1994, due to the
acquisition of Rogers.

1995 COMPARED WITH 1994

     Cost of sales, as a percentage of sales, increased 8.8% in 1995 at Lake
River.  There has been a continuing shift in service mix to lower margin
warehousing which accounted for 57% of Lake River's activity in 1995.  Lake
River's cost of sales were 84.3% in 1995, up from 65.6% in 1994 due to a
reduction in high margin terminal throughput following the loss of its largest
customer.   Cost of sales at Boyles increased to 80%, up 3% from 1994 on higher
direct material costs.  In 1995, zinc usage per ton of production rose 3.7%
with most of the increase concentrated in three plants that had a strong
increase in volume.  Direct labor per ton of steel galvanized decreased 1.9% in
1995, partially offsetting the higher material costs.

     Selling, general and administrative expenses increased $147,000, or 4.1%,
in 1995 to $3,766,000.  One-time severance costs associated with closing and
transferring the Boyles accounting office to the corporate headquarters, and
additional legal expenses accounted for this increase.  Depreciation expense
was $1,471,000, essentially unchanged from 1994.

OTHER (INCOME) EXPENSE

                  1996             1995                1994

                    % of                % of                % of
          $(000)    Sales     $(000)    Sales     $(000)    Sales

Interest  $ 867      1.8 %    $ 634     2.5%      $  502    1.9%
Other      ( 98)    (0.2)%    ----      ----          95    0.4%
Total     $ 769      1.6 %    $ 634     2.5%      $  597    2.3%


1996 COMPARED WITH 1995

     Interest expense increased to $867,000 in 1996 from $634,000 in 1995 due
to the acquisition of Rogers.  Excluding the outstanding debt of Rogers when
acquired and its short-term borrowings for working capital, the Company's
interest expense declined 7.6% to $586,000 in 1996 due to scheduled re-payments
of long-term obligations and a reduction in short-term borrowings for working
capital requirements.  As a percent of total sales, interest expense was 1.8%
in 1996 compared to 2.5% in 1995.  Other income of $98,000 in 1996 came from
the sale of an undeveloped tract of land considered excess to the Company's
future galvanizing operations.


1995 COMPARED WITH 1994

     Interest expense increased to $634,000 in 1995, up $132,000 from 1994 due
to increased borrowings primarily used in operating the discontinued Kinpak
subsidiary.  In 1994, other expense consisted primarily of expenses associated
with an early retirement program offered to certain employees at Lake River and
a provision for environmental expenses attributable to Boyles' Philadelphia
plant which was sold approximately fifteen years ago.  Environmental matters
are discussed below.

INCOME TAXES

     The Company's effective income tax rates for 1996, 1995 and 1994 were
38.3%, 38.8% and 34.3%, respectively.  Income tax expense was $894,000 in 1996. 
The Company recorded an income tax benefit of $446,000 in 1995 as a result of
incurring a loss of $1,149,000 from continuing operations.  Income tax expense
for 1994 was $527,000.

EARNINGS FROM CONTINUING OPERATIONS

     Earnings were restored in 1996 on the strength of increased sales,
improved margins, lower SG&A expenses and lower interest expense for the
Company's continuing operations, and increased further by the acquisition of
Rogers.

     Earnings from continuing operations for 1996, after a deduction for the
minority owner's interest in the net income of Rogers, were $1,274,000 compared
to a loss of $703,000 in 1995.  Earnings from continuing operations before
minority interest for 1996 were $1,438,000.  As discussed elsewhere in this
annual report, the Company's acquisition of all of the common shares of Rogers
occurred in a series of transactions during 1996.   As a result, the Company's
1996 reported earnings from continuing operations reflect a deduction of
$164,000 for the minority shareholders' share of Rogers' net income during
1996.  Effective December 31, 1996, the Company had acquired 100% of Rogers
common stock and future earnings will not be reduced by the prior minority
owners' interest.

DISCONTINUED OPERATION

     In August 1995, the Company adopted a plan to divest its Kinpak packaging
subsidiary and recorded a charge to discontinued operations of $1,525,000 in
the third quarter.  With this charge, the Company wrote off certain inventories
and prepaid expenses of $260,000 and goodwill of $550,000; and, provided
$715,000 for estimated operating losses and losses on the disposal of fixed
assets and other expenses associated with final disposition of the Kinpak
subsidiary.

     On January 5, 1996, the Company signed a letter of intent with a
subsidiary of Ocean Bio-Chem, Inc., a Florida corporation for the sale of
substantially all of the assets and assumption of certain liabilities of Kinpak
and the parties closed the transaction on February 27, 1996.  The purchase
price was $1,840,000, which included the buyer's assumption of $990,000 of
indebtedness under First Mortgage Industrial Revenue Bonds and the balance paid
in cash at closing.

     In 1995, Kinpak recorded a net loss from discontinued operations of
$1,176,000, which included operating losses of $307,000 through August 1995 and
a loss of $869,000 (including operating losses through February 27, 1996) on
disposal of the assets.  Kinpak's sales were $6,083,000 in 1995.  At December
31, 1995 the Company's consolidated balance sheet reflects Net Assets of
Discontinued Operations of $434,000 which were realized upon recording the sale
of Kinpak and liquidation of retained assets and liabilities in 1996.  The
Company has no further liabilities with respect to the operations of its Kinpak
subsidiary, except as guarantor of the facilities Lease Agreement with The
Industrial Development Board of The City of Montgomery ("the Lease"), dated
September 1, 1979, that has been assigned to Ocean Bio-Chem, and some possible
environmental remediation issues for which a portion of the cash proceeds has
been escrowed.  Ocean Bio-Chem is required to make rent payments under the
Lease, and the full amount of such payments apply to retire the revenue bond
debt.  At March 1, 1997, the balance remaining on the bonds was $770,000 which
is payable in annual installments through September 1, 1999. 

CASH FLOWS

OPERATING ACTIVITIES

     Kinark generated an operating cash flow from continuing operations of
$3,612,000 in 1996, for a significant improvement from the negative operating
cash flow of $344,000 in 1995.  Cash flows from operations increased due to
stronger operations and the acquisition of Rogers.  Accounts receivable and
inventories of zinc used in galvanizing increased, also due to the improvement
in operations in 1996 and the acquisition of Rogers.  Operating cash flow from
continuing operations was $4,054,000 in 1994.

INVESTING ACTIVITIES

     Capital expenditures were $2,790,000 in 1996, up 164% from $1,055,000 in
1995.  Approximately 75% of 1996 capital expenditures were invested in the
galvanizing plants to replace material handling equipment and process tanks and
to increase operating capacity.  In 1996, galvanizing operations represented
approximately 81% of Kinark's consolidated sales.  Capital expenditures of
$1,410,000 in 1994 were budgeted approximately equal between the Company's
galvanizing and chemical businesses for normal replacement of operating
equipment.

     Kinark paid cash of $5,579,000 in connection with the acquisition of 73.1%
of the common stock of Rogers Galvanizing Company in 1996.  On January 3, 1997,
Kinark made a final cash payment of $2,236,500 to acquire all of the remaining
shares of Rogers' outstanding common stock which was effective December 31,
1996.  In unrelated transactions, Kinark received net proceeds of $193,000 from
the sale of an undeveloped parcel of land and $807,000 for the sale of Kinpak
in 1996.

<PAGE>
FINANCING ACTIVITIES

     Total debt increased to $8,166,000 from $6,560,000 in 1995, primarily
related to the existing debt of the Rogers business acquired in 1996.  Kinark
raised $7,296,000 (net of $580,000 of issuance costs) in new equity capital in
1996 through the issuance of 3,011,888 shares of its common stock in private
placement transactions and a rights offering to its stockholders.  Total debt
ratio to capital (current and long-term obligations plus stockholders' equity)
at the end of 1996 was 50%, compared to 44.6% in 1995.  In 1996, Kinark made
net payments of $1,146,000 on long-term obligations, reflecting the strength of
the Company's improved operating cash flow.  The Company's total debt increased
$964,000 in 1995 from additional borrowings on the revolving credit facility
for working capital.

     Effective with the disposal of the assets of Kinpak in February 1996, the
revenue bond obligation of $990,000 remaining for the years 1996 through 1999
was assigned to the buyer.  The Company remains as the guarantor of the
facilities lease underlying the revenue bonds, as discussed in the Discontinued
Operation sections of Management's Discussion and the Notes To Consolidated
Financial Statements.

LIQUIDITY AND FINANCIAL CONDITION

     During 1996, bank revolving credit facilities maintained by the Company
and its subsidiaries were adequate to support seasonal working capital
requirements, and to provide short-term funding of certain transaction costs
associated with the acquisition of Rogers.  In the first quarter of 1997, the
Company received a commitment from a bank to restructure and consolidate all of
its credit lines and bank term loans into a new $13.2 million loan agreement. 
Under the agreement, a two-year revolver will be increased to $8,500,00 from
the existing $6,250,000, and a five-year term loan will provide additional
funds for the planned expansion of galvanizing facilities.

     Stockholders' equity increased to $16,735,000, or $2.48 per share, at
December 31, 1996, compared to $8,165,000 and $2.18 per share at the end of
1995, attributable to additions from net earnings and the issuance of
additional common shares.

ENVIRONMENTAL MATTERS

     The Company's facilities are subject to extensive environmental
legislation and regulations affecting their operations and the discharge of
wastes.  The cost of compliance with such regulations during 1996 approximated
$1,059,000 with the disposal and recycling of waste acids generated by the
galvanizing operations representing the major expenditure in this area.  The
Company operates on-site sulfuric acid recovery systems at certain of its
galvanizing plants.  Recovered acid is returned to production, thereby
eliminating the substantial expense associated with the alternative of waste
treatment and removal to an off-site location.  The recovery process generates
a non-hazardous dry ferrous sulphate crystal by-product which the Company sells
commercially.

     The Company's other galvanizing plants use hydrochloric acid, which
requires the off-site disposal of waste acids.  Due to the increasing cost of
waste disposal and decreasing availability of approved disposal methods,
alternative waste hydrochloric acid recycling methods have been evaluated over
recent years.  While it appears that the technology for an economically
feasible system is available, no proven system for the recycling of 
hydrochloric acid utilized in hot dip galvanizing is currently on the market. 
Hydrochloric acid recycling systems will be further evaluated as new systems
become available. Future capital expenditures in this area are expected to
increase, but such expenditures should significantly reduce waste acid disposal
expense.

     Environmentally related expenditures at Lake River  represented a
relatively small percentage of the Company's total cost in this area.  The
majority of waste disposal costs at Lake River are incurred on behalf of
customers and are reimbursable.  Lake River does not take title to the
chemicals stored, blended, or bagged in its facilities and thus is responsible
only for the proper handling of these materials while under its care, custody,
and control.  As described above, Kinark has escrowed proceeds from the sale of
Kinpak's assets for some possible environmental remediation.

     In 1995, Boyles participated in the final clean-up of a former galvanizing
plant site in Philadelphia, Pennsylvania and received notification from the EPA
that it had demonstrated to the satisfaction of the EPA that all requirements
relating to the performance of the Response Action Plan had been completed. 
Clean-up of this site consisted primarily of soil removal at a cost of
approximately $85,000 to Boyles.

     The Company is committed to complying with all federal, state and local
environmental laws and regulations and using its best management practices to
anticipate and satisfy future requirements.  As is typical in the galvanizing
and chemicals businesses, the Company will have additional environmental
compliance costs associated with past, present, and future operations. 
Management has committed resources to discovering and eliminating environmental
issues as they arise.  Because of the frequent changes in environmental
technology, laws and regulations management cannot reasonably attempt to
quantify the Company's potential costs in this area.  However, such costs are
expected to increase above their current levels as discussed above. 

NEW ACCOUNTING STANDARDS

     In February 1997, the FASB issued SFAS No. 128, "Earnings per Share" and
SFAS No. 129, "Disclosure of Information about Capital Structure".

     SFAS No. 128 establishes standards for computing and presenting earnings
per share ("EPS").  This Statement revises the standards for computing earnings
per share previously found in APB Opinion No. 15, Earnings per Share, and makes
them comparable to international EPS standards.  SFAS No. 129 establishes
standards for disclosing information about an entity's capital structure.

     The Company will be required to adopt these statements effective December
31, 1997.  For SFAS No. 128, earlier application is not permitted and the
statement will require restatement of all prior-period EPS data presented.<PAGE>
INDEPENDENT AUDITORS' REPORT

TO THE BOARD OF DIRECTORS AND STOCKHOLDERS OF
KINARK CORPORATION:

     We have audited the accompanying consolidated balance sheets of Kinark
Corporation and subsidiaries as of December 31, 1996 and 1995, and the related
consolidated statements of earnings, stockholders' equity and cash flows for
each of the three years in the period ended December 31, 1996.  Our audits also
included the financial statement schedule listed in the Index at Item 14. 
These financial statements and the financial statement schedule are the
responsibility of the Company's management.  Our responsibility is to express
an opinion on the financial statements and the financial statement schedule
based on our audits.

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

     In our opinion, such consolidated financial statements present fairly, in
all material respects, the financial position of Kinark Corporation and
subsidiaries at December 31, 1996 and 1995, and the results of their operations
and their cash flows for each of the three years in the period ended December
31, 1996 in conformity with generally accepted accounting principles.  Also, in
our opinion, such financial statement schedule, when considered in relation to
the basic consolidated financial statements taken as a whole, presents fairly
in all material respects the information set forth therein.


Deloitte & Touche LLP
Tulsa, Oklahoma
February 14, 1997 (except as to
the second paragraph of the 
Long-Term Debt footnote for
which the date is March 11, 1997)
<PAGE>
CONSOLIDATED BALANCE SHEETS

Kinark Corporation and Subsidiaries
December 31
Thousands of dollars, except per share amounts    1996           1995  

ASSETS
Cash and cash equivalents                    $     2,041    $        30  
Trade receivables, less allowances 
  of $427 for 1996 and $162 for 1995               6,189          3,508  
Inventories                                        4,138          2,615  
Prepaid expenses and other assets                    580            566  
Net assets of discontinued operation              ----              434  
     TOTAL CURRENT ASSETS                         12,948          7,153  

PROPERTY, PLANT AND EQUIPMENT, AT COST
   Land                                              658            483  
   Chemical facilities and equipment              12,319         18,051  
   Galvanizing plants and equipment               18,175         11,730  
   Other                                             191            191  
                                                  31,343         30,455 
   Less: Allowance for depreciation               17,038         21,448 
     TOTAL PROPERTY, PLANT AND EQUIPMENT, NET     14,305          9,007 

DEFERRED INCOME TAXES, NET                         1,773          2,070  
GOODWILL                                           4,183         ---  
OTHER ASSETS                                         230            145  

     TOTAL ASSETS                            $    33,439    $    18,375 

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Maturities of long-term debt         $       994    $       628 
Trade accounts payable and bank overdraft          2,356          1,593 
Other accrued liabilities                          6,182          2,057 
     TOTAL CURRENT LIABILITIES                     9,532          4,278 

LONG-TERM DEBT                                     7,172          5,932 
COMMITMENTS AND CONTINGENCIES                     ---            ---  

STOCKHOLDERS' EQUITY
Common stock - $.10 par value:
    authorized - 18,000,000 shares
    issued - 8,172,450 shares in 1996;
    5,200,562 shares in 1995                         817            520 
Additional paid-in capital                        17,366         10,531 
Retained earnings                                  4,364          3,090 
Common shares in treasury at cost:
    1996 - 1,413,064; 1995 - 1,453,064            (5,812)        (5,976)
     TOTAL STOCKHOLDERS' EQUITY                   16,735          8,165 

TOTAL LIABILITIES & STOCKHOLDERS' EQUITY     $    33,439    $    18,375 

See notes to consolidated financial statements.<PAGE>
CONSOLIDATED STATEMENTS OF EARNINGS



Kinark Corporation and Subsidiaries
Year Ended December 31
Thousands of dollars, except per 
   share amounts                      1996            1995            1994

SALES                              $    47,599    $    25,246    $    26,223 

COSTS AND EXPENSES
   Cost of sales                        36,953         20,524         18,999 
   Selling, general and administrative 
       expenses                          5,198          3,766          3,619 
   Depreciation and amortization         2,347          1,471          1,469 
TOTAL COSTS AND EXPENSES                44,498         25,761         24,087 
OPERATING EARNINGS (LOSS)                3,101           (515)         2,136 

OTHER EXPENSE
   Interest expense, net                   867            634            503 
   Other (income) expense, net             (98)         ---               95 
TOTAL OTHER EXPENSE                        769            634            598 
EARNINGS (LOSS) FROM CONTINUING OPERATIONS
  BEFORE INCOME TAXES AND MINORITY 
  INTEREST                               2,332         (1,149)         1,538 

Income tax expense (benefit)               894           (446)           527 

EARNINGS (LOSS) FROM CONTINUING OPERATIONS
 BEFORE MINORITY INTEREST                1,438           (703)         1,011 

Minority Interest                          164         ---            --- 

EARNINGS (LOSS) FROM CONTINUING 
  OPERATIONS                             1,274           (703)         1,011 

Loss from Discontinued Operation,
net of Income Taxes                       ---          (1,176)         (601)

NET EARNINGS (LOSS)                $     1,274    $     (1,879)  $       410 

NET EARNINGS (LOSS) PER COMMON SHARE
Continuing Operations              $       .21    $       (.19)  $       .27 
Discontinued Operation                     ---            (.31)         (.16)

NET EARNINGS (LOSS) PER COMMON 
  SHARE                            $       .21    $       (.50)  $       .11 

WEIGHTED AVERAGE SHARES OUTSTANDING  5,924,354       3,747,134     3,751,979


See notes to consolidated financial statements.   
<PAGE>

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY


<TABLE>
Kinark Corporation and Subsidiaries
Years Ended December 31
Thousands of dollars, except per share amount

<CAPTION>
                         Common    Additional     
               Shares    Stock ($.10Paid-in  Retained  Treasury
               OutstandingPar Value)Capital  Earnings  Stock     Total

<S>            <C>       <C>       <C>       <C>       <C>
DECEMBER 31, 19933,746,425$520     $10,535   $ 4,559   $(5,980)  $ 9,634

  Net earnings ----      ----      ----          410   ----          410  
  Purchased for treasury(15)----   ----      ----      ----      ----  

DECEMBER 31, 19943,746,410 520      10,535     4,969    (5,980)   10,044  

  Net loss     ----      ----      ----       (1,879)  ----       (1,879) 
  Issued from      1,088 ----          (4)   ----               4----  
  treasury
DECEMBER 31, 19953,747,498 520      10,531     3,090     (5,976)   8,165  

  Net earnings ----      ----      ----        1,274   ----        1,274  
  Issued from treasury   40,000----    (64)  ----          164       100  
  Issued for   2,279,038  228        5,396   ----      ----        5,624  
  private placement
  Issued for     692,850   69        1,503   ----      ----        1,572  
  rights offering
DECEMBER 31, 19966,759,386$817     $17,366   $4,364    $(5,812)  $16,735  


See notes to consolidated financial statements.
</TABLE>
<PAGE>
CONSOLIDATED STATEMENTS OF CASH FLOWS



Kinark Corporation and Subsidiaries
Years Ended December 31
Thousands of dollars                    1996           1995           1994 

OPERATIONS
Net earnings (loss)                $    1,274     $    (1,879)   $    410 
Loss of discontinued operation           ----           1,176         601 
Depreciation and amortization           2,347           1,471         1,469 
Deferred income taxes                     499            (763)        412 
Gain on asset sale                        (71)          ----          ---- 
Changes in assets and liabilities 
(net of acquisition of galvanizing 
business):
   Accounts receivable                   (195)           (286)        205 
   Inventories and other                 (121)            (79)         (111)
   Accounts payable and accrued 
     liabilities                         (121)             16         1,068 

Cash Provided by (Used for)             3,612            (344)        4,054 
  Continuing Operations
Cash Provided by (Used for)              (416)            433        (1,352)
     Discontinued Operation
     CASH PROVIDED BY OPERATIONS        3,196              89         2,702 


INVESTING
Capital expenditures                     (2,790)       (1,055)       (1,410)
Proceeds from sale of land                227          ----           ---- 
Proceeds from sale of discontinued 
  operation                               807          ----           ---- 
Acquisition of galvanizing 
  business                               (5,579)       ----           ---- 

     CASH PROVIDED (USED FOR) 
     INVESTING                           (7,335)       (1,055)       (1,410)

FINANCING
Proceeds from issuing common stock        7,296         ----          ---- 
Proceeds of long-term debt               12,173        14,462         12,969 
Payment of long-term debt               (13,319)      (13,498)       (14,415)

     CASH PROVIDED BY (USED FOR) 
     FINANCING                            6,150           964         (1,446)

INCREASE (DECREASE) IN CASH AND CASH      2,011            (2)          (154)
  EQUIVALENTS
CASH AND CASH EQUIVALENTS AT 
  BEGINNING OF YEAR                          30            32            186 
<PAGE>
CASH AND CASH EQUIVALENTS AT END 
  OF YEAR                          $      2,041   $        30    $        32 

SUPPLEMENTAL DISCLOSURE
     Interest paid                 $        867   $       634    $       503 
     Income taxes paid             $        502   $    ----      $    ---- 
     Fully depreciated assets 
       written off                 $      6,395   $    ----      $    ---- 

See notes to consolidated financial statements.
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Years Ended December 31, 1996, 1995, and 1994

DESCRIPTION OF BUSINESS

     Kinark Corporation (the Company) is engaged in galvanizing and chemical
storage and distribution.  In the galvanizing segment, North American
Galvanizing Company provides metals corrosion protection with eleven regionally
located galvanizing plants.  Kinark operates chemical storage facilities
through Lake River Corporation in Chicago.  The Company grants credit to its
customers on terms standard for these industries, typically net 30 to 45 days. 
The Company's largest customer accounted for 12.1%, 13.2% and 15.4%  of
consolidated sales for the years 1996, 1995 and 1994, respectively.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 

     PRINCIPLES OF CONSOLIDATION.  The consolidated financial statements
include the accounts of the Company and its wholly-owned subsidiaries North
American Galvanizing Company (formerly Rogers Galvanizing Company), Boyles
Galvanizing Company, Lake River Corporation and Kinpak, Inc., (a discontinued
subsidiary).  All intercompany transactions are eliminated in consolidation.

     ESTIMATES.  The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the balance sheet dates and
the reported amounts of revenues and expenses for each of the years.  Actual
results will be determined based on the outcome of future events and could
differ from the estimates.

     CASH AND CASH EQUIVALENTS.  Cash and cash equivalents include interest
bearing deposits with original maturities of three months or less.

     INVENTORIES.  Inventories consist primarily of raw zinc "pigs," molten
zinc in galvanizing kettles and other chemicals and materials used in the
galvanizing process.  All inventories are stated at the lower of cost or market
with zinc valued on a last-in-first-out (LIFO) basis.  Other inventories are
valued primarily on an average cost basis.  Inventories consist of the
following:

(Dollars in Thousands)             1996           1995  

Zinc - LIFO                        $2,786         $2,374
Other Raw Materials                 1,352            241
                                   $4,138         $2,615

     The approximate replacement cost of raw material valued on a LIFO basis
was $2,984,000 and $2,085,000 at December 31, 1996 and 1995, respectively.

     GOODWILL.  Goodwill is amortized over 25 years by the straight line
method.   On a periodic basis, the Company estimates the future undiscounted
cash flows of the operations to which goodwill relates to ensure that the
carrying value of goodwill has not been impaired. 

     DEPRECIATION AND AMORTIZATION.  Plant and equipment, including assets
under capital leases, are depreciated on the straight-line basis over their
estimated useful lives, generally at rates of 2% to 6% for buildings and 10% to
20% for equipment, furnishings, and fixtures. 

     LONG-LIVED ASSETS.  In March 1995, Statement of Financial Accounting
Standards (SFAS) No. 121, "Accounting for the Impairment of Long-Lived Assets
and for Long-Lived Assets to be Disposed Of," was issued.  SFAS No. 121
requires that long-lived assets and certain identifiable intangibles to be held
and used or disposed of including related goodwill, if any, be reviewed for
impairment whenever events or change in circumstances indicate that the
carrying amount of an asset may not be recoverable.  Effective January 1, 1996
the Company adopted this statement and determined that no impairment loss need
be recognized.

     SELF-INSURANCE.  The Company is self-insured for workers' compensation and
certain health care claims for its active employees.  The Company carries
excess insurance providing statutory workers' compensation coverage for claims
exceeding $125,000 per occurrence, subject to an aggregate limit on losses. 
The workers' compensation policy contains a variable dividend plan that could
result in decreased premium costs if claims are contained within targeted
limits.  The reserves for workers' compensation benefits and health care claims
represent estimates for reported claims and  for  claims incurred but not
reported.  Such estimates are generally based on actuarially determined
estimates of the expected values; however, the actual results may vary from
these values since the evaluation of losses is inherently subjective and
susceptible to significant changing factors.

     EARNINGS (LOSS) PER COMMON SHARE.  Earnings (loss) per common share is
calculated by dividing the weighted average number of shares outstanding during
the applicable periods including the effect of stock options, when applicable
using the treasury stock method. 
     
     INCOME TAXES.  The Company calculates income taxes according to SFAS No.
109, "Accounting for Income Taxes."  Net deferred income tax assets on the
consolidated balance sheet reflect the net tax effects of temporary differences
between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for income tax purposes and the benefit of net
operating loss and other tax credit carryforwards.
<PAGE>
LONG-TERM DEBT

                                                       December 31 
(Dollars in Thousands)                            1996            1995

Revolving lines of credit                    $    3,807     $    2,893
Term loans                                        3,151          3,297
3.5% note due 1997                                   23          ---- 
8.0% note due 1998                                   42          ---- 
10.0% note due 2000                                 452          ---- 
6.8% note due 2015                                   30          ---- 
Capital leases                                      661            370
                                                  8,166          6,560
Less current portion                                994            628
                                             $    7,172     $    5,932

     LONG-TERM DEBT.  During 1996 the Company and its subsidiaries operated
under bank credit agreements which provided revolving lines of credit amounting
to $6,250,000 and term loans, all of which expire in April and October 1997. 
Amounts borrowed on the revolvers and  term loans bore interest ranging from
1/2% to 1% over prime during 1996 and 1% over prime during 1995, resulting in
effective rates ranging from 8 3/4% to 9 1/4% at December 31, 1996  and 9 1/4%
at December 31, 1995.  The revolvers can be paid down without penalty, or
additional funds can be borrowed up to the revolver limits.  The term loan
payments are based on various amortization schedules up to ten years with equal
monthly payments of principal and interest.  Substantially all of the Company's
accounts receivable, as well as the inventories and fixed assets of North
American Galvanizing Company were pledged as collateral under the agreements. 
The bank credit agreements placed certain restrictions on capital expenditures,
amount of debt, and pledging of assets.  In addition, the agreement required
the Company to maintain a specified minimum net worth.  The Company was in
compliance with all such provisions of the credit agreements at December 31,
1996.

     On March 11, 1997, the Company received a firm commitment from a bank to
consolidate its current multiple bank lines of credit and term loans into a new
two year agreement.  As set forth in the bank's commitment letter dated March
11, 1997, the new agreement will provide a $8,500,000 revolving line of credit,
a $1,250,000 advancing term loan for expansion of galvanizing plants, and a
$3,500,000 term loan.  Substantially all of the Company's accounts receivable,
inventories and fixed assets will be pledged as collateral under the agreement,
and the agreement will be secured by a guaranty from each of the Company's
operating subsidiary companies.  Amounts borrowed under the agreement will bear
interest at prime minus or plus a spread ranging from minus 25 basis points to
plus 50 basis points, determined by a coverage ratio of defined earnings to
debt service.  Term loan payments will be based on a five year amortization
schedule with equal monthly payments of principal and interest.  The advancing
term loan,  once funded, will require equal monthly payments of principal and
interest based on a seven year amortization schedule.  The revolver may be paid
down without penalty, or additional funds may be borrowed up to the revolver
limits.  The term loan and the advancing term loan may be pre-paid without
penalty.  The agreement will provide for capital expenditures related to a
minimum coverage ratio of defined earnings to debt service plus capital
expenditures, limit the pledging of assets for new debt, and require the
Company to maintain a minimum net worth.  

     Aggregate maturities of long-term debt, exclusive of capital lease
obligations for each of the five years following 1996 are $617,000, $620,000,
$5,901,000, $340,000 and $1 after giving effect to the March 11, 1997 bank
commitment for a new credit agreement.

     CAPITAL LEASES.  Capital leases with an aggregate maturity of $661,000
consist of computers, a manufacturing building and material handling equipment
used in the subsidiary operations.

COMMITMENTS

     The Company leases land, office, warehouse facilities, a manufacturing
building and certain equipment under noncancellable operating leases.  The
leases generally provide for renewal options and periodic rate increases based
on specified economic indicators and are typically renewed in the normal course
of business.  Rent expense was $1,609,000 in 1996, $1,288,000 in 1995, and
$1,186,000 in 1994.

     Minimum annual rental commitments at December 31, 1996 are as follows:


(Dollars in Thousands)        Capital Leases      Operating Leases
     1997                     $    271            $    1,285
     1998                          258                   789
     1999                          189                   550
     2000                           33                    21
     2001                           28                    20
                              $    779            $    2,665

Less: Portion representing interest     118
Net capitalized lease obligation   $    661


CONTINGENCIES

     As discussed in the Discontinued Operation note, on February 27, 1996, the
Company sold substantially all of the assets of its Kinpak subsidiary and the
buyer assumed the capital lease for the plant facility which was financed by a
$3,000,000 industrial revenue bond issue.  Lease payments equal bond principal
and interest at a fixed rate of interest which averages 6 7/8% annually.  The
Company remains contingently liable on the capital lease which requires
principal payments aggregating $770,000 through 1999. 

     The Company will continue to have additional environmental compliance
costs associated with operations in the galvanizing and chemicals businesses. 
The Company is committed to complying with the environmental legislation and
regulations affecting its operations.  Due to the uncertainties associated with
future environmental technologies, regulatory interpretations, and prospective
legislative activity management cannot reasonably attempt to quantify potential
costs in this area.

     The Company expenses or capitalizes, where appropriate, environmental
expenditures that relate to current operations as they are incurred.  Such
expenditures are expensed when they are attributable to past operations and are
not expected to contribute to current or future revenue generation.  The
Company records liabilities when remediation or other environmental assessment
or clean-up efforts are probable and the cost can be reasonably estimated.

     Various litigation arising in the ordinary course of business is pending
against the Company.

     Management believes that resolution of the Company's litigation and
environmental matters should not materially affect the Company's consolidated
financial position. Should future developments cause the Company to record an
additional liability for environmental evaluation, clean up or litigation, the
recording of such a liability could have a material impact on the results of
operations for the period involved.

INCOME TAXES

     The provision (benefit) for  income taxes consists of the following:

                                             December 31,
(Dollars in Thousands)        1996           1995           1994

Current                  $    127       $    (125)     $    304
Deferred                      767            (321)          223
Income tax expense 
  (benefit)              $    894       $    (446)     $    527

     The reconciliation of income taxes at the federal statutory rate to the
Company's effective tax rate is as follows:

Taxes at statutory rate       $    793       $    (391)     $    523 
State tax net of federal 
  benefit                           72             (15)           (8)
Other                               29             (40)           12 
Taxes at effective tax rate   $    894       $    (446)     $    527

     At December 31, 1996, the Company has approximately $3,276,000 of net
operating loss carryforwards available to offset future taxable income. 
Investment tax credits of $118,000 and alternative minimum tax credit
carryforwards of $167,000 are also available as carryforwards to future years. 
The net operating loss carryforwards expire in varying amounts during the years
2002 through 2010 and the investment tax credits expire in 1999.

     The tax effects of significant items comprising the Company's net deferred
tax asset consist of the following:

<PAGE>
                                                         December 31,
(Dollars in Thousands)                            1996                1995
Deferred tax liabilities:
     Differences between book and
       tax basis of property                 $      324          $      304
     Other state income tax                         --                    7
Deferred tax liability                              324                 311

Deferred tax assets:
     Alternative Minimum Tax Credit                 167                  65
     Reserves not currently deductible              579                 232
     Operating loss carryforwards                 1,233               1,856
     Tax credit carryforwards                       118                 157
     Other                                           --                  71
Deferred tax asset                                2,097               2,381
Net deferred tax asset                       $    1,773          $    2,070

Management believes that future taxable income of the Company will more likely
than not be sufficient to realize the net deferred tax asset.

STOCK OPTION PLANS

     At December 31, 1996 and 1995, 1,096,000 and 335,000 shares, respectively,
of the Company's common stock were reserved for issuance under the terms of the
stock option plans for key employees and directors.  The plans generally
provide options to purchase Company stock at fair market value as of the date
the option is granted.  Options generally become exercisable in installments
specified by the applicable plan and must be exercised within ten years of the
grant date.

                              Number
Under Option                  of Shares      Option Price

Balance at January 1, 1994     72,250        $3.19 to $4.75
     Granted                   34,500        $4.50
     Cancelled                 (1,500)       $4.50
Balance at December 31, 1994  105,250        $3.19 to $4.75
     Granted                   32,613        $3.00 to $3.88
     Expired                   (5,500)       $4.50
     Cancelled                (31,113)       $3.06 to $4.50
Balance at December 31, 1995  101,250        $3.00 to $4.75
     Granted                  370,000        $2.50 to $3.50
     Expired                  (25,000)       $3.1875
     Cancelled                (13,250)       $3.25 to $4.625
Balance at December 31, 1996  433,000        $2.50 to $4.75

Weighted average exercise price    $3.09


     At December 31, 1996, 1995, and 1994, options for 109,500, 76,125, and
68,000 shares, respectively, were exercisable.

     The estimated weighted average fair value of options granted during 1996
and 1995 was $3.70 and $3.38 per share.  The Company accounts for its stock
option plans in accordance with Accounting Principles Board Opinion No. 25,
under which no compensation cost has been recognized for stock option awards. 
Had compensation cost for the Company's stock option plans been determined
according to the methodology of SFAS No. 123, the Company's pro forma net
earnings (loss) and earnings (loss) per share for 1996 would have been
$1,086,824 and $.18, respectively, and for 1995 would have been $(1,892,000)
and $(.50), respectively.  The fair value of operations granted under the
Company's stock option plans was estimated using the Black-Scholes option-
pricing model with the following weighted-average assumptions used:  no
dividend yield, expected volatility of 53% and 48%, risk free interest rate of
6.0% and 6.7% in 1996 and 1995, respectively; and expected lives of 5 years. 
The effects of applying SFAS No. 123 in this pro forma disclosure are not
indicative of future amounts.    

DISCONTINUED OPERATION

     During August 1995, the Company finalized a formal plan to discontinue the
operations of its Kinpak subsidiary, comprising the Company's chemical
packaging business.  Substantially all of the assets of Kinpak were
subsequently sold on February 27, 1996 for $1,840,000 consisting of $850,000
cash and the assumption of the capital lease on its plant facilities which was
financed by a $3,000,000 industrial revenue bond issue.  In 1995, the Company
recorded a $1,264,000 loss on disposal (before income taxes of $395,000)
including $460,000 of operating losses incurred during the third and fourth
quarter of 1995 and the period through February 27, 1996, the closing date, and
a $804,000 loss on the sale of  assets. Revenues from Kinpak were $6,346,236
(including revenues of $263,110 for the period through the closing date) in
1995 and, $8,559,000 in 1994.  The  income tax expense (benefit) on the
operating results of Kinpak was ($176,000), and ($346,000), for the years ended
December 31, 1995 and 1994, respectively.


EMPLOYEE BENEFIT PLANS

     Substantially all of the Company's employees are covered by a thrift plan,
except for union employees of Lake River Corporation who are covered by a
defined benefit pension plan.  Company contributions to these benefit plans are
as follows:

                                        Year Ended December 31
(Dollars in Thousands)             1996           1995           1994

Pension Plan                  $     81       $     42       $     53
Thrift Plan                        196            204            260
                              $    277       $    246       $    313

     Pension plan assets consist of group annuity insurance contracts.  Thrift
plan assets consist of short-term investments, intermediate bonds, and listed
stock.  Pension costs are funded in accordance with the Employee Retirement
Income Security Act of 1974 (ERISA).  The funded status of the Company's
defined benefit pension plan is as follows:

                                             December 31
(Dollars in Thousands)             1996           1995           1994
Accumulated benefit obligation
     Vested                   $    1,189     $    1,023     $    916 
     Nonvested                         9             25            5 
     Total                    $    1,198     $    1,048     $    921 

Projected benefit obligation  $    1,359     $    1,087     $    962 
Less fair value of plan assets      (648)          (572)        (551)
Unfunded projected benefit
   obligation                        711            515          411 
Unrecognized net transition
   obligation                       (502)          (347)        (256)

Pension liability recognized
  in the consolidated
  balance sheet               $      209     $      168     $    155 


Applicable rates used in determining the actuarial value of the projected
benefit are as follows:

                                   1996           1995           1994

Discount rate*                     7.5%           7.5%           8.0%
Rate of increase in future
 compensation levels*              6.0%           6.0%           6.0%
Expected long-term rate of
 return on plan assets             7.5%           7.5%           8.5%

*    Used in determining the actuarial value of the projected benefit.


     The periodic net pension cost of the Company's defined benefit pension
plan included the following:

                                             Year Ended December 31
(Dollars in Thousands)             1996           1995           1994

Service cost benefits earned
  during the period           $     33       $    27        $    27 
Interest cost on projected
  benefit obligations               80            70             84 
Return on assets                   (43)          (41)           (53)
Amortization of unrecognized
  net transition obligations         8             8              8 
Amortization of prior service cost  18             7              7 
Amortization of loss                10             3              9 
Net periodic pension cost     $    106       $    74        $    83 


<PAGE>
STOCKHOLDERS' EQUITY

     On June 15, 1996, the Company's stockholders approved an amendment to the
Restated Certificate of Incorporation that increased the authorized common
shares to 18,000,000 shares.

     In January 1996, the Company sold approximately 2.28 million shares of its
common stock in a private placement at a price of $2.50 per share (the "Private
Placement").  In October 1996, the Company sold approximately 693,000 shares of
its common stock in a rights offering at a price of $3.00 per share (the
"Rights Offering").  Proceeds from these sales of stock (net of issuance costs)
were used to fund the acquisition of Rogers (see Acquisition of Rogers
Galvanizing Company).

ACQUISITION OF ROGERS GALVANIZING COMPANY

     On February 5, 1996, the Company acquired 51.2% of the outstanding common
stock of Rogers, and assumed control of the Board of Directors.  Rogers was a
galvanizing company located in Oklahoma.  The purchase price of the common
stock was $4.3 million in cash paid to two trusts (the "Trusts") that held the
common stock.  Under the purchase agreement with the Trusts, the Company agreed
to offer to purchase the remaining outstanding shares of common stock of Rogers
from its minority stockholders for cash at a price per share equivalent to that
paid to the Trusts.  In separate transactions completed in February, March and
November 1996, the Company acquired an additional 21.9% of the outstanding
common stock of Rogers.  The purchase price of this common stock was
approximately $1.8 million in cash.  

     On December 19, 1996, the Company merged Rogers with and into NAGC (the
"Merger") under the terms of that certain Agreement and Plan of Merger dated
November 27, 1996, by and between NAGC and Rogers (the "Merger Agreement"). 
Under the terms of the Merger Agreement, the minority stockholders received
cash in the approximate amount of $2.2 million for the remaining 26.9% of the
outstanding common stock of Rogers.  By virtue of the Merger, the Company
became the sole stockholder of NAGC, the successor-by-merger to Rogers.  

     The acquisition of Rogers was accounted for using the purchase method of
accounting, and the purchase price was allocated to Rogers' assets and
liabilities based upon estimates of their fair value.  Goodwill recorded in the
acquisition was $4.3 million.  Operating results of Rogers are included in the
consolidated financial statements from the date of acquisition.

     The following unaudited pro forma results of operations assume the
acquisition of 100% of Rogers common stock occurred as of January 1, 1995. 
Weighted average common shares used to compute net earnings (loss) per share
include the approximate 3.0 million shares issued in the Private Placement and
Rights Offering.

<PAGE>
                                                  December 31
(Dollars in Thousands)                       1996           1995 

Sales                                   $    48,855    $    42,860  
Earnings from continuing
   operations                           $     1,483    $       117  
Loss from discontinued
   operation, net of taxes              $    ----      $    (1,176)
Net Earnings                            $     1,483    $    (1,059)
Net Earnings per common
   share                                $       .25    $      (.16)

     The pro forma results include the operating results of Rogers for its
fiscal years ended September 30.  The pro forma amounts include an adjustment
to reflect the amortization of the goodwill recorded in the Rogers acquisition
using a straight-line method over 25 years. 

     The pro forma financial information is not necessarily indicative of the
operating results that would have occurred had the Rogers acquisition been
consummated as of January 1, 1995, nor are they necessarily indicative of
future operating results.

FAIR VALUE OF FINANCIAL INSTRUMENTS

The carrying value of financial instruments included in current assets and
liabilities approximates fair value.  The fair value of the Company's long-term
debt is estimated to approximate carrying value based on the borrowing rates
currently available to the Company for bank loans with similar terms and
average maturities.

SUPPLEMENTAL CASH FLOW INFORMATION

ACQUISITION OF GALVANIZING BUSINESS

Fair Value:
    Assets acquired, not including cash                $     9,620 
    Liabilities assumed                                     (5,591)
Goodwill                                                     4,293  
    Purchase price                                           8,322 
Acquisition costs paid in:
    1995                                $      507
    1997                                $    2,236          (2,743)
    Net cash paid for acquisition
    in 1996                                            $     5,579<PAGE>
SEGMENTS OF BUSINESS

                                             Year Ended December 31
(Dollars in Thousands)                  1996           1995           1994 
SALES
    Galvanizing                    $    38,498    $    16,984    $    15,476 
    Chemical storage and distribution    9,101          8,262         10,747 
                                        47,599         25,246         26,223 
OPERATING EARNINGS
    Galvanizing                          4,738          1,414          1,305 
    Chemical storage and distribution      257            174          2,363 
                                         4,995          1,588          3,668 

    Interest expense                       867            634            503 
    Other (income) expense                 (98)        ----               95 
    Corporate headquarters expense       1,894          2,103          1,532 
                                         2,332         (1,149)         1,538 
INCOME TAX EXPENSE (BENEFIT)               894           (446)           527 

EARNINGS (LOSS) FROM CONTINUING OPERATIONS 
   BEFORE MINORITY INTEREST        $     1,438    $      (703)   $     1,011 



                                             Year Ended December 31
(Dollars in Thousands)                  1996           1995             1994

IDENTIFIABLE ASSETS
    Galvanizing                    $    25,636    $    11,790    $    12,079 
    Chemical storage                     3,597          3,555          3,604 
    Chemical packaging                  ----           ----            3,681 
    Net assets of discontinued 
      operations                        ---               434         ---- 
    General corporate                    4,206          2,596          1,590 
                                   $    33,439    $    18,375    $    20,954 
   
CAPITAL EXPENDITURES
    Galvanizing                    $     2,118    $       544    $       678 
    Chemical storage                       662            461            712 
    General corporate                       10             50             20 
                                   $     2,790    $     1,055    $     1,410 

DEPRECIATION AND AMORTIZATION EXPENSE
    Galvanizing                    $     1,718    $       879    $       866 
    Chemical storage                       583            558            573 
    General corporate                       46             34             30 
                                   $     2,347    $     1,471    $     1,469 

<PAGE>
QUARTERLY RESULTS (UNAUDITED)

Quarterly Results of Operations for the Years Ended December 31, 1996 and 1995
Were:

<TABLE>

<CAPTION>
                                             1996
(Dollars in Thousands Except perMar 31Jun 30 Sep 30    Dec 31    Total 
share)

<S>                      <C>       <C>       <C>       <C>       <C>
SALES                    $10,417   $13,337   $12,375   $11,470   $47,599 
GROSS PROFIT             $ 2,263   $ 3,265   $ 2,864   $ 2,254   $10,646 

EARNINGS FROM
   Continuing operations before 
     minority interest       207       678       302       251     1,438 
   Minority interest         (83)     (145)       28        36      (164)

NET EARNINGS             $   124   $   533   $   330   $   287   $ 1,274


NET EARNINGS PER COMMON SHARE$   .02$   .09  $   .05   $   .05   $   .21 




                                                  1995
(Dollars in Thousands Except perMar 31Jun 30 Sep 30    Dec 31    Total 
share)

SALES                    $ 6,074   $ 6,696   $ 6,201   $ 6,275   $25,246
GROSS PROFIT             $ 1,115   $ 1,022   $ 1,570   $ 1,015   $ 4,722  

EARNINGS (LOSS) FROM
   Continuing operations    (270)     (242)       25      (216)     (703)
   Discontinued operations   (212)     (20)   (1,036)       92    (1,176)
NET  (LOSS)              $  (482)  $  (262)  $(1,011)  $  (124)  $(1,879)

EARNINGS (LOSS) PER COMMON SHARE
   Continuing operations $  (.07)  $  (.06)  $   .01   $  (.07)     (.19)
   Discontinued operations   (.06)    (.01)     (.28)      .04      (.31)
NET (LOSS) PER COMMON SHARE$  (.13)$  (.07)  $  (.27)  $  (.03)  $  (.50)

</TABLE>

<PAGE>
                                         
SELECTED FINANCIAL DATA

The following is a summary of selected financial data of the Company (dollars
in thousands, except for per share data):

<TABLE>

<CAPTION>
For The Years Ended December 31,1996    1995      1994      1993      1992 

<S>                           <C>       <C>       <C>       <C>       <C>                                                
Sales                         $47,599   $25,246   $26,223   $25,542   $26,388

Earnings (Loss) from 
  continuing operations before 
  cumulative effect of change 
  in accounting method and 
  minority interest           $ 1,438   $  (703)  $ 1,011   $   765   $ 1,819

Earnings per common share
  from continuing operations
  before cumulative effect of
  change in accounting method $   .21   $  (.19)  $   .27   $   .20   $   .49

Weighted average shares
  outstanding*                  5,924,3543,747,1343,751,979 3,754,854 3,748,469



At December 31,               1996      1995      1994      1993      1992 

Working Capital               $  3,416  $ 2,875   $ 2,761   $ 3,961   $ 4,028
Current Ratio                      1.4      1.7       1.6       2.1       2.1
Total Assets                  $ 33,439  $18,375   $20,954   $20,931   $18,402
Capital Expenditures          $  2,790  $ 1,055   $ 1,410   $ 2,459   $ 3,186
Depreciation                  $  2,347  $ 1,471   $ 1,469   $ 1,304   $ 1,238
Long-Term Obligations         $  7,172  $ 5,932   $ 6,009   $ 7,720   $ 7,548
Stockholders' Equity          $ 16,735  $ 8,165   $10,044   $  9,634  $ 7,052 
Per Share                     $   2.48  $  2.18   $  2.68   $    2.57 $  1.88
Common Shares Outstanding     6,759,386  3,747,4983,746,410 3,746,425 3,746,425


*    Weighted average shares outstanding include the dilutive effect of stock options, if applicable.
</TABLE>
<PAGE>

                         EXHIBIT INDEX


EXHIBIT
   NO.                  DESCRIPTION                              PAGE

3.1       Restated Certificate of Incorporation of Kinark Corporation, as
          amended on June 6, 1996 (incorporated by reference to Exhibit 3.1 of
          the Company's Pre-Effective Amendment No. 1 to Registration Statement
          on Form S-3, Registration No. 333-4937, filed with the Commission on
          June 7, 1996).                          *

3.2       Amended and Restated Bylaws of Kinark Corporation (incorporated by
          reference to Exhibit 3.1 to the Company's Quarterly Report on Form
          10-Q dated March 31, 1996).                            *

10.1      Revolving Credit and Term Loan Agreement dated as of March 24, 1992,
          as amended on October 16, 1992; March 31, 1993; March 31, 1994; March
          31, 1995; and April 1, 1996 by and between Bank of Oklahoma, N.A. and
          Kinark Corporation and subsidiaries (incorporated by reference to
          Exhibit 10.2 to the Company's Annual Report on Form 10-K for the year
          ended December 31, 1993).               *

21.       Subsidiaries of the Registrant.                   

23.       Independent Auditors' Consent.                    

24.01     Power of attorney from Richard C. Butler.         

24.02     Power of attorney from Michael T. Crimmins.       

24.03     Power of attorney from Ronald J. Evans.           

24.04     Power of attorney from Joseph J. Morrow.          

24.05     Power of attorney from John H. Sununu.            

24.06     Power of attorney from Mark E. Walker.            

27        Financial Data Schedule.                          



*    Incorporated by reference.