<PAGE>
                      SECURITIES AND EXCHANGE COMMISSION
                                       
                            Washington, D.C.  20549
                                       
                                  FORM 10-Q/A
(Mark One)
  X    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
 ---             OF THE SECURITIES EXCHANGE ACT OF 1934


For the quarterly period ended September 30, 1997

                                      OR

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

For the transition period from ____________ to  __________


Commission file number  0-4633


                               DBA SYSTEMS, INC.
            (Exact name of registrant as specified in its charter)
                                       
          Florida                                      59-0996417
(State or other jurisdiction of                    (I.R.S. Employer
incorporation or organization)                     Identification No.)

            1200 South Woody Burke Road, Melbourne, Florida  32901
                   (Address of principal executive offices)
                                       
                                (407) 727-0660
             (Registrant's telephone number, including area code)
                                       
     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes    X     No 
    -------     -------                                       

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.

DBA Systems, Inc. Common Stock, $.10 par value, 4,425,562 shares outstanding as
of September 30, 1997.

Total number of sequentially numbered pages:  15
The Exhibit index appears on sequential page 14


                                        1
<PAGE>

PART I -- FINANCIAL INFORMATION

ITEM 1 -- FINANCIAL STATEMENTS


                               DBA SYSTEMS, INC.
                  CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                 (IN THOUSANDS, EXCEPT PER SHARE INFORMATION)
                                  (UNAUDITED)

   
<TABLE>
<CAPTION>
                                                 THREE MONTHS ENDED
                                                    SEPTEMBER 30,
                                                  1997         1996
                                               (Restated)
<S>                                             <C>          <C>
Revenues                                        $ 5,665      $ 6,293
Costs and expenses                                4,973        5,759
Write-down of assets, investments and
 environmental accrual (Note 1)                   5,000           --
                                                -------      -------
Operating income (loss)                          (4,308)         534

Other income (expense):
  Interest income                                   238          174
  Interest expense                                    0          (42)
  Other expense - net                               (70)        (154)
                                                -------      -------
    Total other income (expense) - net              168          (22)
                                                -------      -------

Income (loss) before taxes                       (4,140)         512
Less provision (benefit) for income taxes          (324)         189
                                                -------      -------
Net Income (loss)                               $(3,816)     $   323
                                                -------      -------
                                                -------      -------

Net Earnings (Loss) per common
  and common equivalent share                   $  (.85)     $   .07
                                                -------      -------
                                                -------      -------

Net Earnings (loss) per common share
  assuming full dilution                        $  (.85)     $   .07
                                                -------      -------
                                                -------      -------

Primary weighted average shares outstanding       4,493        4,514
                                                -------      -------
                                                -------      -------

Fully diluted shares outstanding                  4,493        4,527
                                                -------      -------
                                                -------      -------
</TABLE>
    

See accompanying Notes to Condensed Consolidated Interim Financial Statements.


                                        2

<PAGE>

                               DBA SYSTEMS, INC.
                     CONDENSED CONSOLIDATED BALANCE SHEETS
                                (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                     Sept. 30, 1997   June 30, 1997
ASSETS                                                 (Unaudited)      (Audited)
                                                       (Restated)
<S>                                                      <C>            <C>
Current Assets:
 Cash & cash equivalents                                 $  1,259       $  5,595
 Investments                                               12,321          9,311
 Accounts receivable - net                                  2,251          3,523
 Costs and estimated earnings in excess
  of billings on uncompleted contracts                      3,214          2,318
 Inventory                                                  1,998          1,984
 Deferred income taxes                                        650             --
 Other current assets                                         741            438
                                                         --------       --------
  Total Current Assets                                     22,434         23,169
                                                         --------       --------
Property:
 Cost                                                      16,765         16,694
 Less accumulated depreciation
  and amortization                                         10,840         10,667
                                                         --------       --------
   Property--net                                            5,925          6,027
                                                         --------       --------
Other Assets:
 Cost in excess of value of net assets of
  businesses acquired                                         222            224
 Real estate held for sale. (Note 1)                        2,325          4,347
 Investment in preferred stock.                             1,600              0
 Other assets                                                 220            247
                                                         --------       --------
  Total Other Assets                                        4,367          4,818
                                                         --------       --------

Total Assets                                             $ 32,726       $ 34,014
                                                         --------       --------
                                                         --------       --------

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
 Accounts payable                                        $    845       $  1,050
 Accrued expenses                                             985          1,122
 Billings in excess of costs and estimated
  earnings on uncompleted contracts                           881          1,071
 Income Taxes Payable                                         509            183
 Estimated losses on uncompleted contracts                  1,109          1,398
 Other current liabilities                                    173             15
                                                         --------       --------
  Total Current Liabilities                                 4,502          4,839
                                                         --------       --------
Non-current liabilities (Note 1)                            2,850             --
Stockholders' Equity:
 Common stock                                                 557            557
 Paid-in capital                                           24,554         24,539
 Retained earnings                                         19,337         23,153
                                                         --------       --------
  Total                                                    44,448         48,249
 Treasury stock                                           (19,074)       (19,074)
                                                         --------       --------
  Stockholders' Equity - net                               25,374         29,175
                                                         --------       --------


Total Liabilities and Stockholders' Equity              $  32,726      $  34,014
                                                         --------       --------
                                                         --------       --------
</TABLE>
                                       
       See Notes to Condensed Consolidated Interim Financial Statements.

                                        3

<PAGE>

                                       
                               DBA SYSTEMS, INC.
                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                (IN THOUSANDS)
                                  (UNAUDITED)

   
<TABLE>
<CAPTION>
                                           THREE MONTHS ENDED SEPT. 30.
                                                 1997         1996
                                              (Restated)    
<S>                                            <C>          <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)                              $(3,816)     $   323
Adjustments to reconcile net income
  to net cash provided by
 operating activities:
 Depreciation & amortization                       244          261
 Gain on disposal                                   --          (13)
 Write-down of assets, investments and
  environmental accrual (Note 1)                 5,000           --
 Deferred income taxes                            (650)          --
 Decrease (increase) in current assets:
  Accounts receivable                            1,272          783
  Costs and estimated earnings in excess
    of billings on uncompleted contracts          (896)        (462)
  Inventory                                        (14)         113
  Other current assets                            (303)          (5)
 Increase (decrease) in current liabilities:
  Accounts payable                                (205)         312
  Accrued expenses                                 189         (105)
  Billings in excess of costs and
   estimated earnings on uncompleted
   contracts                                      (190)        (422)
  Estimated losses on uncompleted
   contracts                                      (289)         389
  Other current liabilities                          8          (50)
 Other - net                                         0            3
                                               -------      -------
 Net cash provided by operating activities         350        1,127
                                               -------      -------

CASH FLOWS FROM FINANCING ACTIVITIES:
 Proceeds from issuance of common stock             15            0
                                               -------      -------
 Net cash provided by financing activities          15            0
                                               -------      -------

CASH FLOWS FROM INVESTING ACTIVITIES:
 Purchase of Investments                        (3,010)           0
 Investment in preferred stock.                 (1,600)           0
 Capital expenditures                              (91)        (119)
 Proceeds from sale of property                      0           14
                                               -------      -------
 Net cash used in investing activities          (4,701)        (105)
                                               -------      -------
Net increase (decrease) in cash during
  the period                                    (4,336)       1,022
Cash and cash equivalents at beginning
  of period                                      5,595        2,699
                                               -------      -------
Cash and cash equivalents at end of
  period                                       $ 1,259      $ 3,721
                                               -------      -------
                                               -------      -------
</TABLE>
    

       See Notes to Condensed Consolidated Interim Financial Statements.

                                        4
<PAGE>

                               DBA SYSTEMS, INC.
                        NOTES TO CONDENSED CONSOLIDATED
                         INTERIM FINANCIAL STATEMENTS
(1)  The accompanying Condensed Consolidated Interim Financial Statements of
     DBA Systems, Inc. ("the Company" or "DBA") should be read in conjunction
     with the Notes to Consolidated Financial Statements contained in the
     Company's Annual Report on Form 10-K to the Securities and Exchange
     Commission for the year ended June 30, 1997.  The accompanying financial
     statements contained herein reflect all adjustments of a normal recurring
     nature which are, in the opinion of management, necessary to a fair
     statement of the results for the interim periods presented.  The results
     of operations for the interim periods contained herein are not necessarily
     indicative of the results to be expected for the fiscal year.

   
     The accompanying unaudited financial statements for the three months ended
     September 30, 1997 have been restated from amounts previously reported to
     reflect the recognition of a restatement charge of $5.0 million composed 
     of a $2.0 million write down of an Asset Held for Sale and $3.0 million 
     related to the accrual of certain environmental liabilities as follows:
    

     (a) The Asset Held for Sale is a 141,000 square foot manufacturing 
         facility in Kissimmee, Florida which was originally classified as 
         held for sale in June 1996, at which time the recorded book value 
         was approximately $4.4 million.  An independent appraisal of  the 
         property and land was performed in August 1996, which indicated a 
         market value of approximately $5.0 million.  Thereafter, the 
         property was listed for sale with a realtor for approximately $5.2 
         million.  Several potential buyers expressed interest in acquiring 
         the property throughout fiscal 1997, and in July 1997, the Company 
         received a written offer from a prospective buyer and entered into 
         negotiations for the sale of this property to this buyer for 
         consideration approximating the recorded book value.  Ongoing 
         negotiations with this buyer ultimately proved unsuccessful and no 
         further offers were received until October 1997. The offer received 
         in October 1997 led management to conclude that there had been an 
         impairment in the carrying value of the asset of approximately $2.0 
         million.  Since this impairment was determined prior to the issuance 
         of the Company's reported results from operations for the quarter 
         ended September 30, 1997, a corresponding adjustment to reflect this 
         impairment has been recorded in the accompanying financial 
         statements for this quarter.  This amount reflects an adjustment to 
         the previously reported results of operations for this quarter.
   
     (b) In August 1997, DBA management entered into discussions with The 
         Titan Corporation with regard to a potential acquisition of the 
         Company by Titan.  In October 1997, Titan commenced its acquisition 
         due diligence process, which included engaging independent 
         environmental consultants to perform a preliminary environmental 
         site assessment of all DBA's land and property.  This study revealed 
         certain environmental matters at the Company's Kissimmee facility. 
         These environmental matters included, but were not limited to, soil 
         contamination and potential asbestos and lead based paint 
         contamination, all of which DBA management had no prior knowledge.
    

                                        5
<PAGE>

   

         The Company subsequently engaged these environmental consultants to 
         perform a limited initial determination of the potential range of 
         costs to remediate such contamination as well as to determine 
         whether any additional environmental exposures exist with the 
         Company's property.  An initial assessment considering pre clean-up 
         activities, and operation and maintenance of the remediation plan 
         indicates that these costs could range from approximately $3.0 
         million to $5.5 million (undiscounted). Such amounts represent an 
         initial estimate, which could change significantly as more extensive 
         studies are performed.  In accordance with SFAS No. 5, "Accounting 
         for Contingencies"  and SOP 96-1, "Environmental Remediation 
         Liabilities", the Company recorded a $3.0 million charge, 
         representing the low end of the estimate as no amount within the 
         range was deemed to be a better estimate at that time. The 
         environmental remediation actions are being undertaken at the sole 
         discretion of management and have not been induced by threat, by 
         government agencies, or by litigation.  Therefore, amounts included 
         in the aforementioned estimates, specifically related to legal costs 
         and internal labor costs, are not significant relative to the total 
         estimated costs.  Since this environmental issue initially became 
         known to management and was reasonably quantifiable in October 1997, 
         prior to the Company's release of its quarterly results from 
         operations for the three months ended September 30, 1997, an 
         adjustment of $3.0  million was recorded in the accompanying income 
         statement for this quarter. In the accompanying balance sheet, 
         approximately $.2 million is included in Other current liabilities 
         and the remaining $2.8 million is included in Non-current 
         liabilities, based upon the estimated timing of payments related to 
         this liability. This amount represents an adjustment to the 
         previously reported results for this quarter.
    
   
     A summary of the restatement charges noted above and the impact on net 
     income (loss) and earnings per share is as follows (in thousands):

<TABLE>
<CAPTION>
                                                      3 mos ended
                                                      Sep 30, 1997
                                                      ------------
     <S>                                              <C>
     Net income (loss) as
       originally reported                               $   534
                                                         -------
     Restatement Charges:                                    
     Write-down of Asset Held
       For Sale                                            2,000
     Environmental costs                                   3,000
                                                         -------
     Total restatement charges                           $ 5,000
     Tax impact of restatement charges                      (650)
                                                         -------
     Net income (loss) as
       restated                                          $(3,816)
                                                         -------
                                                         -------
</TABLE>
    
                                        6
<PAGE>



                                                             3 mos ended
                                                             Sep 30, 1997
                                                             ------------
     Basic earnings per share
       as originally reported:                                  $ 0.12
     Basic earnings (loss) per
       share as restated:                                       $(0.85)
     Diluted earnings per share
       as originally reported:                                  $ 0.12
     Diluted earnings (loss)
       per share as restated:                                   $(0.85)

(2)  Refer to the Company's Annual Consolidated Financial Statements for the
     Year Ended June 30, 1997, for a description of accounting policies, which
     have been continued without change.  Also, refer to the Notes included in
     those Consolidated Financial Statements for additional details of the
     Company's financial condition, results of operations and changes in
     financial position.

(3)  Inventories consist of the following (in thousands):

                               Sept. 30, 1997 June 30, 1997
                               -------------- -------------
                                (Unaudited)     (Audited)

          Finished Goods          $ 1,815       $ 1,815
          Work in Progress            125           103
          Raw Materials                58            66
                                  -------       -------
          TOTAL                   $ 1,998       $ 1,984
                                  -------       -------

(4)  Net earnings per common and common equivalent share are computed by
     dividing net income by the weighted average number of common shares and
     common equivalent shares outstanding during the period.  Common equivalent
     shares consist of common stock, which may be issued upon exercise of
     outstanding stock options.  For the three-month periods ending September
     30, 1997 and 1996, weighted average shares outstanding  were 4,493,000 and
     4,514,000, respectively.


                                        7
<PAGE>

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

The forward-looking statements included in Management's Discussion and 
Analysis of Financial Condition and Results of Operations, which reflect 
management's best judgment based on factors currently known, involve risks 
and uncertainties.  Actual results could differ materially from those 
anticipated in these forward-looking statements as a result of a number of 
factors as discussed below.  Forward-looking information provided by DBA 
Systems pursuant to the safe harbor established by recent securities 
legislation should be evaluated in the context of these factors.

BUSINESS ENVIRONMENT

Over the past year the defense industry experienced further mergers and 
consolidations of Government contractors.  This trend is expected to increase 
in pace but decrease in size as the pool of candidate merger companies 
contracts.  The U.S. general economy is enjoying an unprecedented boom period 
with low interest rates, unemployment and inflation.  On the other hand, the 
Federal Government continues to decrease in size and increase the scrutiny of 
its spending in the defense area as the country anticipates a "peace 
dividend" resulting from the end of the Cold War.  Therefore, competition for 
available Government contracts remains intense, especially as merged firms 
are able to muster greater resources in the development and proposal process. 
 In response, the Company continues its policy of aggressively managing costs 
while focusing resources on new business opportunities with the greatest 
promise of success.

Liabilities remain at very low levels and liquid assets at very high levels 
while the Company poises itself to expand by taking advantage of commercial 
market opportunities.  The Company is seriously seeking to acquire other 
companies and/or product lines in its bid to broaden sales within core 
competencies and enhance shareholder value.  Indirect costs have been 
maintained at low levels to enhance competitiveness in the fierce 
marketplace. The Company will continue to maintain this posture as it marches 
through the challenging transition period of capturing commercial markets.  
Meanwhile, the Company's two long-term traditional Government customers that 
make up two-thirds of the revenue base are projected to continue their 
current levels of revenues in the foreseeable future.

Reduction in the Department of Defense budget, continued Congressional and 
regulatory oversight of the Government procurement process, increased 
competition within the Company's traditional market niches, and the current 
Government procurement policy to award contracts based primarily on price and 
not exclusively on technical capabilities are all factors which may have a 
material effect on the Company's future operating revenues and profit 
margins. The Government's decisions regarding options presently held by the 
Company under existing contracts may also have an impact on the Company.  
These trends may result in delays in previously anticipated contracts or the 
loss of anticipated business to competitors.  As a result, the reported 
financial information may not necessarily be indicative of the Company's 
future operating results or financial condition.


                                        8
<PAGE>

RESULTS OF OPERATIONS

During the three-month period ended September 30, 1997, DBA recorded revenues 
of $5,665,000, down $628,000 from the $6,293,000 recorded in the comparable 
three-month period in the prior fiscal year.  While revenues increased by 
$720,000 in Proprietary Imagery Exploitation (PIE) and $363,000 in Commercial 
Imagery Exploitation (CIE), there were offsetting decreases of $1,374,000 in 
Systems Engineering/Development (SED) and $339,000 in Tactical Imagery 
Exploitation (TIE). System Engineering/Development revenue decreases were 
mainly due to a revenue drop of $634,000 in IRTS, $273,000 in Avenger 
Tracker, and $229,000 in Training and Simulation business.  Each of these SED 
programs, however, is expected to pick up in sales in the coming quarters.  
Tactical Imagery Exploitation revenue decreases were due to expected lower 
levels of material procured as the Common Imagery Ground/Surface System 
(CIGSS) contract moved into its second year of performance.  Proprietary 
Imagery Exploitation revenue increases were due to recovery to full DBA 
program manpower staffing levels as well as increased non-labor expenses in 
updating software and hardware capabilities.  Commercial Imagery Exploitation 
revenue increases reflected growth from virtually no sales for the first 
quarter last year to sales of $412,000 of software and digitizers for first 
quarter FY 98.

   
The accompanying unaudited financial statements for the three months ended 
September 30, 1997 have been restated from amounts previously reported to 
reflect the recognition of a restatement charge of $5.0 million composed of a 
$2.0 million write down of an Asset Held for Sale and $3.0 million related to 
the accrual of certain environmental liabilities as follows:
    

     The Asset Held for Sale is a 141,000 square foot manufacturing facility 
in Kissimmee, Florida which was originally classified as held for sale in 
June 1996, at which time the recorded book value was approximately $4.4 
million.  An independent appraisal of  the property and land was performed in 
August 1996, which indicated a market value of approximately $5.0 million.  
Thereafter, the property was listed for sale with a realtor for approximately 
$5.2 million. Several potential buyers expressed interest in acquiring the 
property throughout fiscal 1997, and in July 1997, the Company received a 
written offer from a prospective buyer and entered into negotiations for the 
sale of this property to this buyer for consideration approximating the 
recorded book value. Ongoing negotiations with this buyer ultimately proved 
unsuccessful and no further offers were received until October 1997.  The 
offer received in October 1997 led management to conclude that there had been 
an impairment in the carrying value of the asset of approximately $2.0 
million.  Since this impairment was determined prior to the issuance of the 
reported results from operations for the quarter ended September 30, 1997, a 
corresponding adjustment to reflect this impairment has been recorded in the 
accompanying financial statements for this quarter.  This amount reflects an 
adjustment to the Company's previously reported  results of operations for 
this quarter.

     In August 1997, DBA management entered into discussions with The Titan 
Corporation with regard to a potential acquisition of the Company by Titan.  
In October 1997, Titan commenced its acquisition due diligence process, which 
included engaging independent environmental consultants to perform a 
preliminary environmental site assessment of all DBA's land and 


                                        9
<PAGE>

   
property.  This study revealed certain environmental matters at the Company's
Kissimmee facility. These environmental matters included, but were not limited 
to, soil contamination and potential asbestos and lead based paint 
contamination, all of which DBA management had no prior knowledge.
    
   
The Company subsequently engaged these environmental consultants to perform a 
limited initial determination in determining the potential range of costs to 
remediate such contamination as well as to determine whether any additional 
environmental exposures exist with the Company's property.  An initial 
assessment considering pre clean-up activities, and operation and maintenance 
of the remediation plan indicates that these costs could range from 
approximately $3.0 million to $5.5 million (undiscounted).  Such amounts 
represent an initial estimate, which could change significantly as more 
extensive studies are performed.  In accordance with SFAS No. 5 "Accounting 
for Contingencies"  and SOP 96-1 "Environmental Remediation Liabilities", the 
Company recorded a $3.0 million charge, representing the low end of the 
estimate as no amount within the range was deemed to be a better estimate at 
that time.  The environmental remediation actions are being undertaken at the 
sole discretion of management and have not been induced by threat, by 
government agencies, or by litigation. Therefore, amounts included in the 
aforementioned estimates, specifically related to legal costs and internal 
labor costs, are not significant relative to the total estimated costs.   
Since this environmental issue initially became known to management and was 
reasonably quantifiable in October 1997, prior to the Company's release of 
its quarterly results from operations for the three months ended September 
30, 1997, an adjustment of $3 million was recorded in the accompanying income 
statement for this quarter. In the accompanying balance sheet, approximately 
$.2 million is included in Other current liabilities and the remaining $2.8 
million is included in Non-current liabilities, based upon the estimated 
timing of payments related to this liability. This amount represents an 
adjustment to the previously reported results for this quarter.
    

   
Excluding the restatement charge noted above, operating income was $692,000 
during the current three-month period, up $158,000 from  $534,000 in the 
comparable period in the prior fiscal year.  The current quarter's operating 
margin excluding the special charge was 12.2% as compared to the operating 
margin of 8.5% in the prior year's comparable quarter.  The increase in the 
operating profit excluding the special charge was attributable primarily to 
an increase of $100,000 in Proprietary Imagery Exploitation and $53,000 in 
Systems Engineering/Development as compared to FY 97.  Proprietary Imagery 
Exploitation enhanced performance for first quarter FY 98 reflected an 
increase in revenues due to greater contract material expenditures and labor 
as well as higher award fee.  Systems Engineering/Development's more 
favorable performance for first quarter FY 98 reflected successful completion 
of certain Avenger Tracker contracts.
    

During the three-month period ending September 30, 1997, the Company recorded 
new business bookings of $2,521,000 as compared to $2,133,000 in the prior 
year.  As a result, the backlog at September 30, 1997 was approximately 
$13,300,000, down $3,300,000 as  compared to the June 30, 1997 balance of 
approximately $16,600,000.  An order is entered into backlog only when the 
Company receives a definite commitment from a customer.  The decreasing trend 
in backlog is expected to reverse itself over the next two quarters as the 
Company receives extensions to its contracts in the Proprietary Imagery 
Exploitation ($6-7 million) and Tactical Imagery Exploitation ($3-4 million). 
Furthermore, to date only $840,000 has been booked of the $10.6 


                                        10
<PAGE>


million Asset Monitor contract with Flash Comm which was announced on 
September 29, 1997. Significant further bookings are expected to be taken 
before the year end as this emerging market is penetrated.

Interest expense during the current period was $0 as compared to $42,000 
recorded in the comparable quarter in the prior fiscal year since all 
remaining debentures were liquidated in December 1996.  The Company has no 
long term debt.  Interest income increased by $64,000 as the amount of the 
invested cash averaged $1.4 million more during the first quarter of FY 98.

   
The tax benefit for the three months ended September 30, 1997 represents the 
deferred tax benefit, primarily resulting from the restatement charge noted 
above, net of a valuation allowance, which management believes more likely 
than not will be realized in future periods.  The tax provision for the three 
months ended September 30, 1996 approximates the statutory federal and state 
income tax rates.
    

   
As a result of the above factors, specifically the restatement charge noted 
above, a net loss of $3,816,000 in the current period ended September 30, 
1997 was compared to net income of $323,000 in the same period of the prior 
fiscal year. Fully diluted per share amounts were a loss of $.85 for the 
three months ending September 30, 1997 versus $.07 profit recorded in the 
comparable quarter in the prior fiscal year.
    

LIQUIDITY AND CAPITAL RESOURCES

At September 30, 1997, the Company had working capital of approximately 
$17,932,000, down $398,000 or 2.2%, when compared to the $18,330,000 as of 
June 30, 1997. Accounts receivable-net decreased $1,272,000 from $3,523,000 
at June 30, 1997 to $2,251,000 at September 30, 1997 due to efficient 
collection of outstanding trade receivables and aggressive pursuit of "past 
due" accounts.  Costs and estimated earnings in excess of billings on 
uncompleted contracts increased from $2,318,000 at June 30, 1997 to 
$3,214,000 at September 30, 1997 mainly due to timing differences with 
contract material in Proprietary Imagery Exploitation.

The Company is seriously studying several further investment opportunities in 
planning to utilize part of its remaining $14 million of cash in order to 
increase return-on-equity and enable the Company to grow in revenue and 
income. Additionally, recently the Company engaged The Robinson-Humphrey 
Company, Inc., investment bankers from Atlanta, to develop, evaluate and 
report to the Board of Directors on alternatives to maximize shareholder 
value.  The alternatives being evaluated by Robinson-Humphrey are not 
constrained and they cover the gamut including sale of the Company or a 
division thereof, merger acquisitions or divestitures, revising the Company's 
capital structure, and identifying possible strategic partners.  In that 
vein, the Company has engaged in the past and continues to engage from time 
to time in discussions with various parties with respect to possible 
transactions as described above, but the Company has not entered into any 
agreement to effect any such transaction, except the transactions with Flash 
Comm, Inc. as discussed below.


                                        11
<PAGE>

In September 1997 the Company invested $1.6 million by purchasing convertible 
preferred Series B stock in Flash Comm, Inc.(FCI).  This investment will 
result in 6.2% ownership of FCI, or 7.2% if DBA exercises outstanding 
warrants.  DBA is the manufacturing partner for FCI, a start-up company which 
awarded a $10.6 million contract to DBA for the design, development, and 
manufacturing of asset monitors for its truck-trailer location device.  FCI's 
ability to perform on this contract is subject to FCI's ability to obtain 
significant additional debt and/or equity financing.

The Company's $4,000,000 unsecured line of credit with a bank expires January 
31, 1998 and is expected to be renewed.  Amounts drawn on this line of credit 
accrue interest at either the bank's prime rate or LIBOR plus 1.75% as 
selected by the Company upon utilization of any portion of the line of 
credit.  The Company had no borrowings against the line of credit at 
September 30, 1997.

On February 26, 1997 the Company announced that its Board of Directors 
authorized a stock repurchase program whereby the Company may repurchase up 
to 200,000 shares of its outstanding stock in the open market or in 
negotiated transactions through August 31, 1997 and at such prices as the 
Company may decide.  This action was taken based on the assessment that DBA's 
common shares were undervalued.  During the authorized period, the Company 
repurchased 1,500 shares of common stock on the open market.

During the quarter ending September 30, 1997, the Company acquired capital 
equipment of approximately $91,000.

The Company believes liquidity and capital funding requirements for fiscal 
1998 can be internally satisfied from working capital.

PART II -- OTHER INFORMATION

ITEM 5. -- OTHER INFORMATION

On September 29, 1997 the Company announced the signing of a $10.6 million 
Agreement with Flash Comm, Inc. (FCI) for the design, development, and 
manufacture of mobile sensor and transceiver asset monitor units to be 
employed in a two-way, North American continent wireless data communications 
system. The asset monitor units enable operators in the commercial 
transportation market to track fixed and mobile assets such as trucks and 
trailers.  FCI is majority owned by HVFM-II, whose major investor is the 
Harris Corporation. HVFM-II partners with Harris for Harris' commercial 
technology spin-offs, counting among its accomplishments a portfolio of 
successful startup commercial companies.

In July the Company announced the award of a $1 million two year contract by 
US Army Communications/Electronics Command (CECOM) for depot level repair and 
overhaul of Vertical Displacement Gyroscopes.  The award of this contract 
marks DBA's return to the gyro business and will position the Company to 
pursue other depot level gyro repair contracts. 


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<PAGE>


ITEM 6. --     EXHIBITS AND REPORTS ON FORM 8-K

     (a)  The exhibit index filed with this report is on page 14.

     (b)  Reports on Form 8-K - none.






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 executed
on its behalf by the undersigned, thereto duly authorized.

                              DBA SYSTEMS, INC.


   
Date: June 10, 1998                 By: /s/ ERIC M. DEMARCO
      --------------------             -----------------------------
                                       Eric M. DeMarco
                                       Principal Accounting Officer
    


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<PAGE>



                               DBA SYSTEMS, INC.
                                 EXHIBIT INDEX
                                       
                                       
                                                              Page No.
                                                              --------
Exhibit 11 - Computation of earnings (loss) per share            15






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