FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

(Mark One)

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

For the quarterly period ended May 31, 1998

Commission File Number 1-6018

TOKHEIM CORPORATION
(Exact name of Registrant as specified in its charter)

INDIANA                                                   35-0712500
(State or other jurisdiction of                         (I.R.S. Employer
incorporation or organization)                          Identification No.)

10501 CORPORATE DRIVE, FORT WAYNE, IN                     46845
(Address of principal executive offices)                (Zip Code)

(Registrant's telephone number including area code): (219) 470-4600

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

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

        Yes (X)              No

As of May 31, 1998,12,648,222 shares of voting common stock were
outstanding.

In addition, 763,928 shares of convertible preferred stock were held by the
Retirement Savings Plan for Employees of Tokheim Corporation and
Subsidiaries.

The exhibit index is located on page 17



TOKHEIM CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENT OF
EARNINGS 
(Amounts in thousands, except amounts per share)

<TABLE>
<CAPTION>


                                                          Three Months Ended             Six Months Ended
                                                   ------------------------------------------------------------
                                                   May 31, 1998    May 31, 1997    May 31, 1998    May 31, 1997
                                                     Unaudited       Unaudited       Unaudited      Unaudited
                                                   -------------   -------------   -------------   ------------

<S>                                                  <C>            <C>              <C>           <C>         
NET SALES                                            $    99,652    $     95,857     $   190,505   $    187,881


Cost of sales, exclusive of items listed below            73,118          70,379         140,191        140,771
Selling, general, and administrative expenses             18,637          16,985          34,894         32,888
Depreciation and amortization                              2,619           2,452           5,118          4,380
Merger and acquisition costs and other unusual items         345             478           6,333            478
                                                       ---------         -------        --------        -------
          OPERATING PROFIT                                 4,933           5,563           3,969         9,364

Interest expense, net                                      3,322           4,455           7,333         8,195
Foreign currency gains                                     (815)             (57)           (780)         (177)
Minority interest                                           (10)             124              63            81
Other income, net                                          (499)            (132)           (278)         (200)
                                                      ----------      ----------       ----------     --------

Earnings (loss) before income taxes and                  
extraordinary loss                                         2,935           1,173          (2,369)        1,465
Income taxes                                                 508             (37)            809           130
                                                      ----------      ----------      ----------    ----------

Earnings (loss) before extraordinary loss                  2,427           1,210         (3,178)         1,335
Extraordinary loss from debt extinguishment               (4,965)            ---         (4,965)           ---
                                                      ----------      ----------      ----------    ----------

        NET EARNINGS (LOSS)                              (2,538)           1,210         (8,143)         1,335
Preferred stock dividends                                  (370)            (375)          (744)          (758)
                                                      ----------      ----------      ----------    ----------

        EARNINGS (LOSS) APPLICABLE TO COMMON STOCK   $   (2,908)   $         835     $   (8,887)   $       577
                                                      ==========   =============      ==========    ==========

Earnings (loss) per common share:
    Basic:
        Before extraordinary loss                    $     0.17   $        0.10     $    (0.39)   $      0.07
        Extraordinary loss on debt extinguishment         (0.42)            ---          (0.49)           ---
                                                      ----------  -- ----------      ----------    ----------
        Net earnings (loss)                          $    (0.25)   $       0.10     $    (0.88)   $      0.07
                                                      ==========  == ==========      ==========    ==========
        Weighted average shares outstanding              11,884            7,974        10,087          7,961
    Diluted:
        Before extraordinary loss                    $     0.16    $       0.09     $    (0.39)   $      0.07
        Extraordinary loss on debt extinguishment         (0.39)            ---          (0.49)           ---
                                                      ----------  -- ----------      ----------    ----------
        Net earnings (loss)                          $    (0.23)   $       0.09     $    (0.88)   $      0.07
                                                      ==========  == ==========      ==========    ==========
        Weighted average shares outstanding               12,881           8,824        10,087          8,809



</TABLE>



TOKHEIM CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEET
(IN THOUSANDS)


<TABLE>
<CAPTION>

                                                           MAY 31, 1998         NOVEMBER 30,
                                                            Unaudited              1997
ASSETS                                                     -------------      -----------------

CURRENT ASSETS:
<S>                                                          <C>                    <C>        
    CASH AND CASH EQUIVALENTS                                $    12,310            $     6,438
    RECEIVABLES, NET                                              77,844                 83,011
    INVENTORIES:
        RAW MATERIALS AND SUPPLIES                                30,939                 29,427
        WORK IN PROCESS                                           28,345                 27,514
        FINISHED GOODS                                             7,088                  7,406
                                                              ----------             ----------
                                                                  66,372                 64,347
    PREPAID EXPENSES                                               6,554                  6,705
                                                              ----------             ----------
TOTAL CURRENT ASSETS                                             163,080                160,501
PROPERTY, PLANT, AND EQUIPMENT, NET                               43,926                 42,535
OTHER TANGIBLE ASSETS                                              3,454                  3,615
GOODWILL, NET                                                     71,046                 67,695
OTHER NON-CURRENT ASSETS AND DEFERRED CHARGES, NET                15,297                 16,273
                                                              ----------             ----------
TOTAL ASSETS                                                 $   296,803            $   290,619
                                                              ==========             ==========

LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
    CURRENT MATURITIES OF LONG-TERM DEBT                     $     2,253            $     2,391
    NOTES PAYABLE, BANKS                                             257                     98
    CASH OVERDRAFT                                                11,836                 10,575
    ACCOUNTS PAYABLE                                              45,337                 54,597
    ACCRUED EXPENSES                                              46,400                 51,190
                                                              ----------             ----------
    TOTAL CURRENT LIABILITIES                                    106,083                118,851
    SENIOR SUBORDINATED NOTES                                     55,000                 90,000
    LONG-TERM DEBT                                                27,129                 28,487
    GUARANTEED EMPLOYEES' STOCK OWNERSHIP PLAN                     8,232                  9,429
    OBLIGATION
    POSTRETIREMENT BENEFIT LIABILITY                              14,581                 14,378
    MINIMUM PENSION LIABILITY                                      2,173                  2,173
    OTHER LONG-TERM LIABILITIES                                    4,042                  5,169
    DEFERRED INCOME TAXES                                            364                    342
    MINORITY INTEREST                                                977                  1,319
                                                                 218,581                270,148
                                                              ----------             ----------

REDEEMABLE CONVERTIBLE PREFERRED STOCK                            24,000                 24,000
GUARANTEED EMPLOYEES' STOCK OWNERSHIP PLAN OBLIGATION            (8,232)                (9,429)
TREASURY STOCK, AT COST                                          (4,902)                (4,718)
                                                              ----------             ----------
                                                                  10,866                  9,853
                                                              ----------             ----------

COMMON STOCK                                                      88,883                 21,158
MINIMUM PENSION LIABILITY                                         (2,173)                (2,173)
FOREIGN CURRENCY TRANSLATION ADJUSTMENTS                         (20,152)               (18,048)
RETAINED EARNINGS                                                    946                  9,821
                                                              ----------             ----------
                                                                  67,504                 10,758
LESS TREASURY STOCK, AT COST                                        (148)                  (140)
                                                              ----------             ----------
                                                                  67,356                 10,618
                                                              ----------             ----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                   $   296,803            $   290,619
                                                              ==========             ==========


</TABLE>


TOKHEIM CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS
(IN THOUSANDS)


<TABLE>
<CAPTION>

                                                                                   SIX MONTHS ENDED
                                                                           --------------------------------
                                                                              MAY 31, 1998     MAY 31, 1997
                                                                               UNAUDITED        UNAUDITED
                                                                           --------------     -------------
CASH FLOWS FROM OPERATING ACTIVITIES:

<S>                                                                          <C>                <C>        
NET EARNINGS (LOSS)                                                          $    (8,143)       $     1,335
ADJUSTMENTS TO RECONCILE NET EARNINGS (LOSS) TO CASH PROVIDED FROM
    (USED IN) OPERATIONS:
    WRITE-OFF OF IN PROCESS RESEARCH AND DEVELOPMENT                                5,879                --
    EXTRAORDINARY LOSS FROM DEBT EXTINGUISHMENT                                     4,965                --
    DEPRECIATION AND AMORTIZATION                                                   5,118             4,380
    AMORTIZATION OF DEFERRED DEBT ISSUANCE COST                                       721               924
    MINORITY INTEREST                                                               (342)                82
    GAINS ON SALE OF PROPERTY, PLANT, AND EQUIPMENT                                   (2)              (77)
    DEFERRED INCOME TAXES                                                              31                22
    CHANGES IN ASSETS AND LIABILITIES:
        RECEIVABLES, NET                                                            5,142            14,585
        INVENTORIES                                                               (2,783)           (1,755)
        PREPAID EXPENSES                                                               98           (1,475)
        ACCOUNTS PAYABLE                                                          (8,677)             (877)
        ACCRUED EXPENSES                                                          (5,225)           (4,073)
        U.S. AND FOREIGN INCOME TAXES                                               (202)               521
        OTHER                                                                       (833)           (1,793)
                                                                               ----------        ----------
NET CASH PROVIDED FROM (USED IN) OPERATIONS                                       (4,253)            11,799
                                                                               ----------        ----------

CASH FLOWS FROM INVESTING AND OTHER ACTIVITIES:
ACQUISITION, NET OF CASH ACQUIRED                                                (12,137)               ---
PLANT AND EQUIPMENT ADDITIONS                                                     (5,058)           (3,375)
PROCEEDS FROM SALE OF PROPERTY, PLANT, AND EQUIPMENT                                  177               379
                                                                               ----------        ----------
NET CASH USED IN INVESTING AND OTHER ACTIVITIES                                  (17,018)           (2,996)
                                                                               ----------        ----------

CASH FLOWS FROM FINANCING ACTIVITIES:
REDEMPTION OF SENIOR SUBORDINATED NOTES                                          (35,000)               ---
PREMIUMS PAID ON DEBT EXTINGUISHMENT                                              (3,450)               ---
DECREASE IN TERM DEBT                                                               (386)           (4,548)
DECREASE IN NOTES PAYABLE, BANKS                                                    (830)           (6,327)
INCREASE IN CASH OVERDRAFT                                                          1,461             2,332
PROCEEDS FROM ISSUANCE OF COMMON STOCK                                             72,582               286
EQUITY ISSUANCE COSTS                                                             (4,858)               ---
TREASURY STOCK, NET                                                                 (191)             (300)
PREFERRED STOCK DIVIDENDS                                                           (744)             (758)
                                                                               ----------        ----------
NET CASH PROVIDED FROM (USED IN ) FINANCING ACTIVITIES                             28,584           (9,315)
                                                                               ----------        ----------

EFFECT OF TRANSLATION ADJUSTMENT ON CASH                                          (1,441)             (266)

CASH AND CASH EQUIVALENTS:
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                                    5,872             (778)
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR                                        6,438             9,814
                                                                               ----------        ----------
CASH AND CASH EQUIVALENTS, END OF PERIOD                                     $     12,310       $     9,036
                                                                               ==========        ==========

</TABLE>





NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

The interim financial statements are unaudited and reflect all adjustments
(consisting solely of normal recurring adjustments, other than the merger
and acquisitions costs and other unusual items and extraordinary loss from
debt extinguishment) that, in the opinion of management, are necessary for
a fair statement of the financial position, results of operations and cash
flows of the financial position, of operations and cash flows of the
interim periods presented. This report includes information in a condensed
form and should be read in conjunction with the audited consolidated
financial statements included in the Company's report on Form 10-K for the
year ended November 30, 1997, filed by Tokheim Corporation (the "Company")
with the Securities and Exchange Commission on February 13, 1998. The
results of operations for the three and six month periods ended May 31,
1998 are not necessarily indicative of the results to be expected for the
full year or any other interim period.

Certain prior year amounts in these financial statements have been
reclassified to conform with current period presentation.

ACQUISITION OF RPS BUSINESS OF SCHLUMBERGER LIMITED

On June 19, 1998, Tokheim announced the signing of an agreement (the
"Purchase Agreement") regarding the acquisition (the "Acquisition") of the
fuel dispenser, systems and service business of Schlumberger Limited (the
"RPS Business"). The Purchase Agreement contains other provisions customary
for transactions of this type, including representations and warranties
with respect to the conditions and operations of the RPS Business,
covenants with respect to the conduct of the RPS Business' operations prior
to the consummation of the Acquisition and various closing conditions,
including the receipt or waiver of all other necessary consents and
approvals and the continued accuracy of representations and warranties
contained in the Purchase Agreement.

In connection with the Acquisition of the RPS Business, the Company is in
the process of finalizing a comprehensive refinancing of the its current
debt structure. Included in this refinancing plan, the Company has
commenced a tender offer to repurchase the remaining $55,000 of its
outstanding 11 1/2% Senior Subordinated Notes due 2006 (the "Notes") at a
tender price of 119.512%, expressed as a percentage of the original face
value of the Notes. The Company believes that this refinancing will provide
more than adequate funds to consummate the Acquisition and support the
Company's working capital needs for the short-term and on into the
foreseeable long- term future. Terms of this refinancing are not yet final.

ACQUISITION OF MANAGEMENT SOLUTIONS, INC.

In December 1997, the Company acquired Management Solutions, Inc. ("MSI").
MSI develops and distributes retail automation systems (including Point of
Sale ("POS") software), primarily for the convenience store, petroleum
dispensing and fast food service industries. The Company paid MSI's
stockholders an initial amount of $12,000. The Company is also obligated to
make contingent payments of up to $13,200 over the next three years based
upon MSI's performance. The $13,200 consists of $8,000 of additional
purchase price, $2,600 related to a non-compete agreement, and $2,600 of
additional employee compensation. The Company borrowed funds for the
initial purchase price under the Company's bank credit facility (the "Bank
Credit Facility"). As part of the transaction, the Company entered into an
employment relationship with Arthur S. Elston, the President of MSI,
pursuant to which he will oversee the Company's retail automation systems
business.

The transaction was accounted for as a purchase. Intangible assets of
$4,800 were recorded which are being amortized over four years. In process
research and development ("R & D") of $5,900 was written off in connection
with the acquisition and is included in merger and acquisition ("M & A")
costs and other unusual items in the consolidated statement of earnings.
The portion of the contingent payments that do not relate to employee
compensation will be allocated to various intangible assets and goodwill
amortized over periods ranging from four to twelve years as the payments
are made.

EARNINGS PER SHARE

The Company adopted Statement of Financial Accounting Standards SFAS No.
128, Earnings Per Share, during the first quarter of fiscal 1998. Under
SFAS No. 128, the Company presents two earnings per share ("EPS") amounts,
Basic and Diluted. Basic EPS is calculated based on earnings available to
common shareholders and the weighted average number of shares outstanding
during the reported period. Diluted EPS includes additional dilution from
potential common stock, such as stock issuable pursuant to the conversion
of preferred stock or the exercise of stock options outstanding. The
incremental shares from conversions of preferred stock and the exercise of
stock options were not included in computing diluted EPS for the three and
six month periods ended May 31, 1998, since the effect of such is
antidilutive during periods when a net loss is reported. For the three
month and six month periods ended May 31, 1998 there were 767,817 shares of
convertible preferred stock outstanding and 228,528 and 245,596 of vested
and non-vested stock options, respectively, that could be exercised, which
could have a dilutive effect on EPS in the future. During the three month
and six month periods ended May 31, 1998, 4,250 and 74,812, respectively,
of stock options were exercised. EPS for the three and six month periods
ended May 31, 1997, has been restated to apply the provisions of SFAS No.
128. Earnings per common share calculated for the three and six month
periods ended May 31, 1997, on a primary and fully diluted basis under the
provisions of Accounting Principles Board Opinion No. 15 differs by less
than one cent per share from that calculated on a basic and diluted basis
under SFAS No. 128 as there is no difference in the earnings amounts
applicable to common stock and the difference between the weighted average
shares outstanding used in the two calculations is not material.

The following table presents information necessary to calculate earnings
per share for the three and six month periods ended May 31, 1998 and 1997.

<TABLE>
<CAPTION>


                                                           Basic
                                                    Three Months Ended                  Six Months Ended
                                                  May 31,         May 31,            May 31,       May 31,
                                                    1998            1997               1998          1997
                                                    ----            ----               ----          ----

<S>                                              <C>               <C>                <C>           <C>  
Shares outstanding (in thousands):
     Weighted average outstanding............    11,884            7,997              10,087        7,938
                                                 ======            =====              ======        =====

Net earnings (loss):
     Before extraordinary item............... $   2,427        $   1,210           $ (3,178)    $   1,335
     Extraordinary loss on debt
       extinguishment, net of tax benefit....    (4,965)             --              (4,965)          --
                                                -------             ----             -------         ----
     Net earnings (loss).....................    (2,538)           1,210             (8,143)        1,335
     Preferred stock dividend................      (370)            (375)              (744)         (758)
                                                  -----            -----               -----        -----
     Earnings (loss) applicable to common
       stock................................. $  (2,908)       $     835          $  (8,887)    $     557
                                              ==========       =========          =========     =========

Net earnings (loss) per common share:
     Before extraordinary item............... $    0.17        $    0.10           $  (0.39)    $    0.07
     Extraordinary loss on debt 
       extinguishment, net of tax benefit....     (0.42)              --              (0.49)           --
                                              ---------        ---------           ---------    ---------
     Net earnings (loss)..................... $  (0.25)        $    0.10           $  (0.88)    $    0.07
                                              =========        =========           =========    =========
     

</TABLE>


For financial reporting purposes, the loss per share, assuming full
dilution, is considered to be the same as basic since the effect of the
common stock equivalents would be antidilutive.

<TABLE>
<CAPTION>



                                                                          Diluted
                                                    Three Months Ended                  Six Months Ended
                                                  May 31,         May 31,            May 31,       May 31,
                                                    1998            1997               1998          1997
                                                    ----            ----               ----          ----
<S>                                              <C>               <C>                <C>           <C>  
Shares outstanding (in thousands):
     Weighted average outstanding............    11,884            7,997              10,087        7,938
     Share equivalents.......................       229               57                 --            54
     Weighted conversion of preferred stock...      768              791                 --           792
                                                 ------            -----              ------        -----
     Adjusted outstanding....................    12,881            8,845              10,087        8,784
                                                 ======            =====              ======        =====

Net earnings (loss):
     Before extraordinary item............... $   2,427        $   1,210           $ (3,178)    $   1,335
     Extraordinary loss on debt
       extinguishment, net of tax benefit....    (4,965)              --             (4,965)          --
                                                -------        ---------             -------         ----
     Net earnings (loss).....................    (2,538)           1,210             (8,143)        1,335
     Preferred stock dividend................      (370)            (375)              (744)         (758)
                                                -------        ---------             -------      --------
     Earnings (loss) applicable to common
       stock..................................$ (2,908)        $     835           $ (8,887)    $     557
                                              =========        =========           =========    =========

Net earnings (loss) per common share:
     Before extraordinary item............... $    0.16        $    0.09           $  (0.39)    $    0.07
     Extraordinary loss on debt extinguish-
       ment, net of tax benefit.............      (0.39)             --               (0.49)          --
                                              ----------       ---------           ---------    ---------
     Net earnings (loss)..................... $   (0.23)       $   0.09            $  (0.88)    $    0.07
                                              =========        =========           =========    =========

</TABLE>



ACCOUNTING PRONOUNCEMENTS

Statement of Financial Accounting Standards ("SFAS") No. 129 "Disclosure of
Information about Capital Structure," was adopted during the first quarter
of the fiscal year ending November 30, 1998. This statement did not have a
material impact on the Company's financial position, results of operations
or cash flows as disclosure requirements did not change for the Company
with this new statement. SFAS No. 131 "Disclosures about Segments of an
Enterprise and Related information," and SFAS No. 132 "Employers'
Disclosures about Pensions and Other Postretirement Benefits," are
effective for the year ending November 30, 1999. In the opinion of
management, these statements will not have a material impact on the
Company's financial position, results of operations, or cash flows. SFAS
No. 130 "Reporting Comprehensive Income," is effective for the year ending
November 30, 1999. Due to the significance of the foreign currency
translation adjustments recorded, comprehensive income is expected to be
significantly lower than reported net earnings. SFAS No. 133, "Accounting
for Derivative Instruments and Hedging Activities," was issued in June,
1998 and is effective for the year ending November 30, 2000. SFAS No. 133
establishes a new model for accounting for derivatives in the balance sheet
as either assets or liabilities and measured at fair value. Certain
disclosures concerning the designation and assessment of hedging
relationships are also required. In the opinion of the Company, the
adoption of this statement will not have a material impact on the Company's
financial position, results of operations, or cash flows.

The American Institute of Certified Public Accountants ("AICPA") Statements
of Position ("SOP") No. 96-1 "Environmental Remediation Liabilities," and
SOP No. 97-2 "Software Revenue Recognition," were adopted during the first
quarter of 1998. SOP No. 96-1 provides guidance for recognizing, measuring
and disclosing environmental remediation liabilities. SOP No. 97-2
supersedes SOP No. 91-1 and provides more specific guidance on revenue
recognition related to software products. The adoption of these statements
did not have a material impact on the Company's financial position, results
of operations or cash flows. SOP No. 98- 1 "Accounting for the Costs of
Computer Software Developed or Obtained for Internal Use," is effective for
the year ending November 30, 2000. The Company adopted this statement
effective March 1, 1998 capitalizing approximately $400 associated with
internally developed software developed in connection with its
implementation of the new financial and accounting software package.

COMMON STOCK OFFERING

In March 1998, the Company completed an offering of 4,370,000 shares of its
common stock (the "Offering"). Net proceeds from the Offering totaled
approximately $67,724. The Company used $39,356 of the proceeds to redeem
$35,000 in aggregate principal amount of the Notes. These Notes were
redeemed at the call price of 109.857%, expressed as a percentage of the
original face value, resulting in premiums paid of $3,450 along with
accrued interest of $906. Following the redemption, $55,000 in aggregate
principal amount of the Notes remains outstanding. The Company recorded an
extraordinary loss on the extinguishment of the Notes of approximately
$4,965 during the second quarter of 1998. This loss includes $3,450 of
premiums paid to purchase the Notes and $1,515 representing the write-off
of a proportionate share of the original unamortized deferred issuance
costs. The remaining $28,368 was applied toward the Bank Credit Facility
and general corporate purposes. In December 1997, approximately $12,000 was
borrowed under the Bank Credit Facility to finance the acquisition of MSI.
This amount was repaid as part of the reduction of the Bank Credit Facility
balance. In the period prior to when the Company was able to effect the
redemption of the Notes, the proceeds were used to reduce the outstanding
balance of the Bank Credit Facility with the remaining amount placed in
short-term investments.

See financial statements and accompanying notes in the Company's 1997
Annual Report to Shareholders.


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

GENERAL

Tokheim is one of the world's largest manufacturers and servicers of
electronic and mechanical petroleum dispensing systems. These systems
include petroleum dispensers and pumps, POS, dispenser payment or
"pay-at-the-pump" terminals, replacement parts and upgrade kits. As a
result of its acquisition of the petroleum dispenser business of Sofitam
S.A. ("Sofitam") in September 1996, Tokheim has positioned itself as a
global competitor in the petroleum dispenser business, with the ability to
provide both products and services to customers in over 80 countries.
Tokheim is a leading supplier of petroleum dispensing systems in the United
States, France, Canada, Mexico, and Africa, and has strong market positions
in Italy, the United Kingdom, Germany, and Spain. The Company also has
operations established in Asia, Eastern Europe, and Latin America.

On June 19, 1998, Tokheim announced the signing of the Purchase Agreement
regarding the Acquisition of the RPS Business of Schlumberger Limited. See
"Notes to the Consolidated Condensed Financial Statements - Acquisition of
the RPS Business of Schlumberger Limited."

RESULTS OF OPERATIONS

Consolidated sales for the three and six month periods ended May 31, 1998
were $99,652 and $190,505, respectively. Consolidated sales, excluding
sales of the newly acquired subsidiary, MSI, were $97,796 and $187,034 as
compared to $95,857 and $187,881 in the year ago three and six month
periods, respectively.

On a comparable basis, consolidated sales for the 1998 three month period
increased 2.0% over the prior year period with the six month sales
declining by 0.5% from 1997 levels. Sales for North America, excluding
export sales, have increased 22.3% for the three month period from $34,935
in 1997 to $42,712 in 1998. The six month period sales have increased 17.3%
from $65,855 to $77,220. This increase is due to a stronger demand in the
Company's retail distribution and commercial dispenser sales for the first
half of the year. This demand was driven by new, more convenient products,
such as credit/debit card readers, environmental regulations, such as those
requiring vapor recovery systems, and unusually mild weather in the
northern regions for the first half of the year, which facilitated an
earlier than normal start of the construction period. International sales,
including domestic export sales, have decreased 9.5% for the three month
period from $60,882 in 1997 to $55,804 in 1998. The six month period sales
for 1998 have decreased 10.0% from 1997 amounts of $122,026 to $109,814. A
major contributing factor to this decrease in sales dollars for the three
and six month periods is attributable to the continued decline in foreign
currency exchange rates from prior year levels. International sales for the
three and six month periods ended May 31, 1998 would have been $2,741 and
$7,308 higher, respectively, if average exchange rates of European and
African currencies remained consistent with 1997 rates. In addition,
current year domestic export sales to the Asia Pacific region have
materially declined from prior year levels caused by the significant
economic downturn in that region's economy. Although the United States of
America ("U.S.") has taken steps to assist in the improvement of the Asia
Pacific region's economy, there can be no assurance as to when Asian market
conditions will improve or whether they may worsen or spread to other
regions.

Gross margins as a percent of sales (defined as net sales less cost of
sales divided by net sales) have remained constant at 26.6% for each of the
three month periods ended May 31, 1998 and 1997. The gross margin for the
six month period ended May 31, 1998 was 26.4% indicating a 1.3% improvement
from the year ago period. This improvement was primarily due to the
unusually high margins obtained during the first three months of 1998,
brought on by strong North America sales volumes. The first three months of
the Company's business cycle are generally lower sales volume months
creating less opportunity to recover manufacturing fixed cost.

Selling, general, and administrative expenses as a percent of sales for the
three and six month periods ended May 31, 1998 were 18.7% and 18.3%,
respectively. On a comparable basis, after excluding the effects of MSI,
these expenses were 18.3% and 17.2% for the three and six month periods of
1998 compared to 17.7% and 17.5% for the same year ago periods. The
increase in the three month period of 1998 was attributed to increased
costs associated with year 2000 corrective actions and royalty payments to
satisfy a previously settled lawsuit. The decrease in the six month period
of 1998 is attributable to the Company's continued implementation of the
Sofitam consolidation plan resulting in continued cost reductions in the
international operations.

Merger and acquisition cost and other unusual items for the three month
period ended May 31, 1998 relates to involuntary termination and other exit
costs incurred in connection with the sales office in Boca Raton, Florida.
The Company has ceased operations in Boca Raton to provide more responsive
attention to its customers in the Latin American region and Mexico through
its Tokheim de Mexico subsidiary. In addition to the restructuring
expenses, the merger and acquisition costs and other unusual items for the
six month period ended May 31, 1998 consists primarily of a $5,987
non-recurring write-off for in process research & development ("R&D") that
was purchased in connection with the acquisition of MSI. This amount
represents the estimated fair value of acquired incomplete R&D projects as
determined by an independent appraisal.

Net interest expense for the three and the six month periods ended May 31,
1998 have decreased by $1,133 and $862, respectively. These decreases are
due to significantly reduced debt levels from the prior year. The Company
reduced its outstanding borrowing under its Bank Credit Facility by $28,349
and repurchased $35,000 of its Notes from the net proceeds received from
the March 1998 equity offering.

Depreciation and amortization expense for the three and six month periods
of 1998 was $2,619 and $5,118 versus $2,452 and $4,380 reported in the
comparable year ago periods. The majority of the increase between periods
relates to increased amortization expense related to intangible assets
recorded in connection with the acquisition of MSI, as well as increased
depreciation expense on capital additions during the current year.

Foreign currency gains for the 1998 second quarter were $815 verses gains
of $57 in the second quarter of 1997. The current year to date foreign
currency gains were $780 compared to gains of $177 in the first six months
of 1997. During the second quarter of 1998 the Company realized a foreign
currency gain of $770 associated with the repayment of various French Franc
denominated Euro Currency contracts previously entered into under the
Company's Bank Credit Facility. Under the terms of the Bank Credit
Facility, the Company has the ability to borrow funds under Euro Currency
contracts denominated in a variety of foreign currencies. Due to the
decline in the value of the French Franc, the Company was able to repay
these contracts with less U.S. Dollars than it received when the original
contracts were entered into. Currently all remaining contracts held under
the Bank Credit Facility are denominated in U.S. Dollars.

Other income, net, for the second quarter of 1998 increased 0.4% as a
percent of sales from the prior year period. This increase was attributable
to fluctuations in numerous small income and expense items, none of which
are individually significant. Other income, net, for the six month periods
ended May 31, 1998 and 1997 remained unchanged at 0.1% of sales.

Income taxes have increased in the current year for both the three and six
month periods as compared to the year ago periods. This increase is due to
higher aggregate pretax earnings at foreign subsidiaries.

As a result of the above mentioned items, earnings before extraordinary
loss from debt extinguishment were $2,427 or $0.16 per common share on a
diluted basis for the three months ended May 31, 1998 compared to earnings
of $1,210 or $0.09 per common share on a diluted basis for the same period
in 1997. Loss before extraordinary loss from debt extinguishment was $3,178
or $0.39 per common share on a diluted basis for the six months ended May
31, 1998 compared to earnings of $1,335 or $0.07 per common share on a
diluted basis for the same period in 1997.

During the second quarter of 1998, the Company recorded an extraordinary
loss from debt extinguishment of $4,965, or $0.39 and $0.49 loss per
diluted common share for the three month and six month periods ended May
31, 1998, respectively. This loss was the result of the Company redeeming
$35,000 of its Notes under the call provision of the related indenture. The
amount includes $3,450 of premiums paid to call the Notes and $1,515
representing the write-off of a proportionate share of the original
unamortized deferred issuance cost.

LIQUIDITY AND CAPITAL RESOURCES

Cash used in operations for the first six months ended May 31, 1998, was
$4,253 versus cash provided by operations of $11,799 in the comparable
period of 1997. This decline from the prior year was caused primarily by
decreased accounts payables, accrued expenses and increased inventories for
the six month period to a greater extent than in the prior year. Cash flow
from accounts receivable reductions were $14,585 in the year ago period
compared to $5,142 in the current year. During the first six months of 1997
the Company made major improvements in the newly acquired Sofitam entities
accounts receivable collection period and therefore generated an
exceptionally large inflow of cash from receivables collections at these
locations.

In March 1998, the Company completed an offering of 4,370,000 shares of its
common stock (the "Offering"). Net proceeds from the Offering totaled
approximately $67,724. The Company used $39,356 of the proceeds to redeem
$35,000 in aggregate principal amount of the Company's Notes. These Notes
were redeemed at the call price of 109.857%, expressed as a percentage of
the original face value, resulting in premiums paid of $3,450 along with
accrued interest of $906. Following the redemption, $55,000 in aggregate
principal amount of the Notes remains outstanding. The remaining $28,368
was applied toward the Bank Credit Facility and general corporate purposes.
In December 1997, approximately $12,000 was borrowed under the Bank Credit
Facility to finance the acquisition of MSI. This amount was repaid as part
of the reduction of the Bank Credit Facility balance. In the period prior
to when the Company was able to effect the redemption of the Notes, the
proceeds were used to reduce the outstanding balance of the Bank Credit
Facility with the remaining amount placed in short-term investments.

The Company's French subsidiaries participate, as needed, in a customary
practice of selling traits (selling accounts receivable without recourse)
to financial institutions. Under this agreement, the subsidiaries present
traits to financial institutions and receive 95% of the face value in the
form of short-term loans. These loans bear interest at a variable rate,
which was 3.8% at May 31, 1998. When the subsidiaries receive payment from
the customers, they remit 95% of the amount received back to the financial
institutions plus accrued interest. The amount outstanding at May 31, 1998
was approximately $7,062. The Company did not sell traits prior to 1997.

The Company incurred capital expenditures of $5,058 and $3,375 for the six
months ended May 31, 1998 and 1997, respectively. The increase relates
primarily to capital requirements for implementing the consolidation plan
for Sofitam, improvements at the Company's Fort Wayne, Indiana
manufacturing facility, and capitalizable costs associated with the
implementation of new finance and accounting software packages at the Fort
Wayne, Indiana and Lansdale, Pennsylvania locations. The Company adopted
SOP No. 98-1 "Accounting for the Costs of Computer Software Developed or
Obtained for Internal Use," effective March 1, 1998, capitalizing
approximately $400 associated with internally developed software developed
in connection with its implementation of the new financial and accounting
software package.

In connection with the continued implementation of the Sofitam
consolidation plan, the Company expects to incur a number of charges.
During the first six months of 1998, the Company charged $1,376 against the
acquisition accrual recorded for estimated cost necessary to realign the
Sofitam operations in Europe, including the closure of certain redundant
operations. This realignment also resulted in $137 of charges against
operating income for the 1998 six month period. With respect to the
consolidation, the Company anticipates charging $6,000 against the
remaining acquisition accrual during the next twelve to eighteen months.
The Company also expects to charge an additional $1,600 against operating
income for continued realignments in the second half of 1998. These
expenditures were originally scheduled for the 1999 fiscal year, however,
due to changing circumstances the Company has stepped up its timetable for
these realignments.

As part of the MSI acquisition, the Company is obligated to make contingent
payments of up to $13,200 over the next three years based on MSI's
performance. The $13,200 consists of $8,000 of additional purchase price,
$2,600 related to a non-compete agreement, and $2,600 of additional
employee compensation.

The Company has guaranteed loans to the Employees' Stock Ownership Plan
("ESOP") in the amounts of $8,232 and $9,429 at May 31, 1998 and 1997,
respectively. The Trustee who holds the ESOP Preferred Stock may elect to
convert each preferred share to one common share in the event of a
redemption by Tokheim, certain consolidations or mergers of Tokheim, or a
redemption by the Trustee that is necessary to provide for distributions
under the Company's Retirement Savings Plan. A participant may elect to
receive a distribution from the plan in cash or common stock. If redeemed
by the Trustee, the Company is responsible for purchasing the preferred
stock at the twenty-five dollar floor value. The Company may elect to pay
the redemption price in cash or an equivalent amount of common stock.
Preferred stock dividends paid were $744 and $758 for the first six months
of 1998 and 1997, respectively.

In December 1997, the Company began to implement its year 2000 ("Y2K")
plan, including the organization and staffing of a full-time Y2K program
office. The Company has organized the process into the following areas:
product certification (ensuring all products sold by the Company are Y2K
compliant); internal information systems (ensuring all internal hardware
and software is Y2K compliant through upgrades or replacement); suppliers,
distributors and external agents (ensuring all suppliers, distributors and
external agents used by the Company to purchase or sell goods and services
are Y2K compliant); and manufacturing and infrastructure (ensuring
manufacturing and infrastructure systems are Y2K compliant).

As of June 30, 1998, all of the Company's products have been tested; all
critical suppliers and distributors have been surveyed with such follow-up
as is needed; 40% of applicable software programs have been converted and
tested; and the manufacturing and infrastructure segment of the project is
to begin shortly. The Company expects to complete all of its diagnostics by
the end of the third quarter, 1999. To date, the Company has not uncovered
any major Y2K problems. The Company estimates that it will spend a total of
approximately $2,200 by December 31, 1999 (of which approximately $540 had
been sent by May 31, 1998), to become Y2K compliant.

The Company's long-term investments and long-term loans to foreign
subsidiaries, when translated at the May 31, 1998 and November 30, 1997
period end currency rates, resulted in a translation adjustment that is
reflected as a reduction to shareholders' equity of $20,263 and $18,048,
respectively. The adjustments represent the effect of changes in the
current rate of exchange from the beginning of the year to the end of the
six month periods used in translating the net assets of foreign
subsidiaries, including certain long-term intercompany loans of foreign
subsidiaries into U.S. Dollar amounts. The majority of the 1998 and 1997
adjustments are the result of translating long-term loans to foreign
affiliates, which were established to complete the acquisition of Sofitam.
It should be noted that the Company's loan covenants exclude foreign
currency translation gains or losses when calculating compliance with loan
covenants.

No cash dividends on common stock were declared or paid during the period.
Currently, the Bank Credit Facility and the indenture governing the Notes
restrict the payment of dividends.

Based upon the above discussions of liquidity and capital resources,
together with the Company's ability to generate future cash flows from
operations through various means and the availability of borrowing capacity
under the Company's Bank Credit Facility, $27,424 at July 3, 1998, the
Company believes that it has adequate liquidity available to it to meet
cash requirements for the short-term and the foreseeable long-term periods.
This assessment does not take into consideration the effect of the pending
consummation of the Acquisition as discussed below.

        After the Acquisition

After consummation of the Acquisition, the Company's principal sources of
liquidity are expected to be cash flow from operations, including cash flow
anticipated to be generated from the Acquisition and available borrowings
under the agreements effecting the related refinancing. It is expected that
the Company's principal uses of cash will be to provide working capital,
finance capital expenditures, fund costs associated with the Acquisition,
implementation of a consolidation plan and meet debt service requirements.
Following the consummation of the Acquisition, the Company will be highly
leveraged. Based upon current operations, anticipated cost savings and
future growth, the Company believes that its cash flow from operations,
together with available borrowings under the agreements effecting the
refinancing and its other sources of liquidity (including leases), will be
adequate to meet its anticipated requirements for working capital, capital
expenditures, lease payments and scheduled principal and interest payments.
There can be no assurance, however, that the Company's business will
continue to generate cash flow at or above current levels or that estimated
cost savings or growth can be achieved.

In connection with the Acquisition, the Company is in the process of
finalizing a comprehensive refinancing of the Company's current debt
structure. Included in this refinancing plan, the Company has commenced a
tender an offer to repurchase the remaining $55,000 of its outstanding
Notes at a tender price of 119.512%, expressed as a percentage of the
original face value of the Notes. The Company belies that this refinancing
will provide more than adequate funds to consummate the Acquisition and
support the Company's working capital needs for the short-term and on into
the foreseeable long-term future. Terms of this refinancing are not yet
final.


EXHIBIT INDEX

NO.          DESCRIPTION

(a)
3.1     Restated Articles of Incorporation of the Registrant, as amended,
        as filed with the Indiana Secretary of State on February 5, 1997
        (incorporated by reference to the Registrant's Annual Report on
        form 10-K/A for the year ended November 30, 1997).

3.2     Bylaws of the Registrant, as rested on July 12, 1995 and amended
        March 2, 1998.

10.12   Amendment No. 5 to Credit Agreement, dated as of March 20, 1998,
        among the Registrant, certain subsidiaries of the Registrant,
        certain banks and NBD Bank, N.A. (the "Credit Agreement"), dated as
        of September 6, 1996 (incorporated by reference to the Registrant's
        Quarterly Report on form 10-Q for the period ended February 28,
        1998).

11      Statement regarding computation of per share earnings.

27      Financial data schedule.

(b)     Reports on Form 8-K.

        The Company filed a report on form 8-K dated December 31, 1997,
        describing the MSI acquisition. An amendment to that form 8-K dated
        December 31, 1997, including financial statements of MSI and
        unaudited pro forma financial statements. The Company filed a form
        8-K dated March 17, 1998 containing an exhibit to the registration
        statement for the Offering.


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.


                                            TOKHEIM CORPORATION

Date: July 14, 1998                         /S/ DOUGLAS K. PINNER
                                            ______________________________
                                            Chairman, President and Chief 
                                            Executive Officer



Date: July 14, 1998                         /S/ JOHN A. NEGOVETICH
                                            _____________________________
                                            Executive Vice-President, Finance
                                            and Administration
                                            and Chief Financial Officer



EXHIBIT INDEX

NO.           DESCRIPTION

(a)

3.1     Restated Articles of Incorporation of the Registrant, as amended,
        as filed with the Indiana Secretary of State on February 5, 1997
        (incorporated by reference to the Registrant's Annual Report on
        form 10-K/A for the year ended November 30, 1997).

3.2     Bylaws of the Registrant, as rested on July 12, 1995 and amended
        March 2, 1998.

10.12   Amendment No. 5 to Credit Agreement, dated as of March 20, 1998,
        among the Registrant, certain subsidiaries of the Registrant,
        certain banks and NBD Bank, N.A. (the "Credit Agreement"), dated as
        of September 6, 1996 (incorporated by reference to the Registrant's
        Quarterly Report on form 10-Q for the period ended February 28,
        1998).

11      Statement regarding computation of per share earnings.

27      Financial data schedule.

(b)     Reports on Form 8-K.

        The Company filed a report on form 8-K dated December 31, 1997,
        describing the MSI acquisition. An amendment to that form 8-K dated
        December 31, 1997, including financial statements of MSI and
        unaudited pro forma financial statements. The Company filed a form
        8-K dated March 17, 1998 containing an exhibit to the registration
        statement for the Offering.




TOKHEIM CORPORATION AND SUBSIDIARIES
Exhibit (11) - Earnings per share
For the three and six month periods ended May 31, 1998 and 1997.
(Restated to apply SFAS No. 128)


Basic earnings per share ("EPS") is calculated based on earnings (loss)
available to common shareholders and the weighted average number of common
stock shares outstanding during each period. Diluted EPS includes
additional dilution from potential common stock equivalents such as stock
issued pursuant to the conversion of preferred stock or the exercise of
stock options outstanding.

The following table presents information necessary to calculate earnings
per share for the three month and six month periods ended May 31, 1998 and
1997.


<TABLE>
<CAPTION>


                                                           Basic
                                                    Three Months Ended                  Six Months Ended
                                                    ------------------                  -----------------
                                                  May 31,         May 31,            May 31,       May 31,
                                                    1998            1997               1998          1997

<S>                                              <C>               <C>                <C>           <C>  
Shares outstanding (in thousands):
     Weighted average outstanding............    11,884            7,997              10,087        7,938
                                                 ======            =====              ======        =====

Net earnings (loss):
     Before extraordinary item............... $   2,427        $   1,210           $ (3,178)    $   1,335
     Extraordinary loss on debt
       extinguishment, net of tax benefit....    (4,965)              --             (4,965)           --
                                                -------         ---------           --------      -------
     Net earnings (loss).....................    (2,538)            1,210            (8,143)        1,335
     Preferred stock dividend................      (370)             (375)             (744)         (758)
                                                -------         ---------          ---------    ---------
     Earnings (loss) applicable to common 
       stock.................................  $ (2,908)       $     835           $ (8,887)    $     557
                                              =========        =========           =========    =========
     
Net earnings (loss) per common share:
     Before extraordinary item............... $    0.17        $    0.10           $  (0.39)    $    0.07
     Extraordinary loss on debt
       extinguishment, net of tax benefit....     (0.42)              --              (0.49)           --
                                              ---------        ---------           ---------    ---------
      Net earnings (loss).....................$   (0.25)       $    0.10           $  (0.88)    $    0.07
                                              ==========       =========           =========    =========
    
</TABLE>


For financial reporting purposes, the loss per share, assuming full
dilution, is considered to be the same as basic since the effect of the
common stock equivalents would be antidilutive.


<TABLE>
<CAPTION>

                                                                          Diluted
                                                    Three Months Ended                  Six Months Ended
                                                  May 31,         May 31,            May 31,       May 31,
                                                    1998            1997               1998          1997
                                                    ----            ----               ----          ----
<S>                                              <C>               <C>                <C>           <C>  
Shares outstanding (in thousands):
     Weighted average outstanding............    11,884            7,997              10,087        7,938
     Share equivalents.......................       229               57                 246           54
     Weighted conversion of preferred stock...      768              791                 768          792
                                                 ------            -----              ------        -----
     Adjusted outstanding.....................   12,881            8,845              11,101        8,784
                                                 ======            =====              ======        =====

Net earnings (loss):
     Before extraordinary item............... $   2,427        $   1,210           $ (3,178)    $   1,335
     Extraordinary loss on debt
       extinguishment, net of tax benefit...     (4,965)              --             (4,965)          --
                                              ---------         --------            --------     --------
     Net earnings (loss).....................    (2,538)           1,210             (8,143)        1,335
     Preferred stock dividend................      (370)            (375)              (744)         (758)
                                              ---------        ---------            --------     --------
     Earnings (loss) applicable to common
       stock................................. $ (2,908)        $     835           $ (8,887)    $     557
                                              =========        =========           =========    =========
     
Net earnings (loss) per common share:
     Before extraordinary item............... $    0.16        $    0.09           $  (0.35)    $    0.07
     Extraordinary loss on debt
       extinguishment, net of tax benefit....     (0.39)              --              (0.45)          --
                                              ---------        ---------           ---------    ---------
     Net earnings (loss)..................... $   (0.23)       $    0.09           $  (0.80)    $    0.07
                                              =========        =========           =========    =========
</TABLE>