SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                               AMENDMENT NO. 1 TO
                                    FORM 10-Q

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

For the quarterly period ended  March 29, 1998
                                -----------------------------------

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

For the transition period from                        to
                               ----------------------    ----------------------
Commission file number    0 -19703
                       ----------------

                               Farrel Corporation
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)

                 Delaware                                   22-2689245
          ----------------------                     -----------------------

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

                   25 Main Street, Ansonia, Connecticut, 06401
               ---------------------------------------------------
               (Address of principal executive offices) (Zip Code)

                                 (203) 736-5500
                              --------------------
              (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
    ---       ---

                      APPLICABLE ONLY TO CORPORATE ISSUERS:
                      -------------------------------------

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

               CLASS                        OUTSTANDING AT     May 8, 1998
--------------------------------------------------------------------------------
Common Stock (Voting), $.01 par value                     5,942,582
                                                     -------------------


<PAGE>


                               Farrel Corporation
                               ------------------

                                      Index
                                      -----
                                                                         Page
                                                                         ----
Part I.  Financial Information                                              
         ---------------------

               Consolidated Balance Sheets -                          
               March 29, 1998 and December 31, 1997                       4

               Consolidated Statements of Operations -
               Three Months Ended March 29, 1998
                 and March 30, 1997                                       5

               Consolidated Statements of Cash Flows -
               Three Months ended March 29, 1998
                 and March 30, 1997                                       6

               Notes to Consolidated Financial Statements                 7


Part II.  Other Information                                               9
          -----------------



                                  Page 2 of 10
<PAGE>


                                EXPLANATORY NOTE


This amendment to the Quarterly  Report on Form 10-Q of Farrel  Corporation  for
the  quarter  ended  March 29,  1998 is being  filed to  correct an error in the
compilation  of  the  Consolidated  Balance  Sheet  for the  captions  Cash  and
Short-term   debt  and  the  related   Statement  of  Cash  Flows  and  to  make
corresponding adjustments to the Financial Data Schedule.










                                  Page 3 of 10
<PAGE>



                         Part I - Financial Information
                               FARREL CORPORATION
                           CONSOLIDATED BALANCE SHEETS
                        (In thousands, except share data)
<TABLE>
<CAPTION>

                                                                         March 29,              December 31,
                                                                           1998                     1997
ASSETS                                                                 (Unaudited)
      Current Assets:
<S>                                                                           <C>                       <C>   
         Cash and cash equivalents                                            $1,719                    $1,447
         Accounts receivable, net of allowance for
            doubtful accounts of  $224 and $179,
            respectively                                                      13,613                    14,423
         Inventory (Note 2)                                                   23,397                    18,277
         Other current assets                                                  2,485                     2,957
                                                                      ---------------        ------------------
                       Total current assets                                   41,214                    37,104
         Property, plant and equipment - net
            of accumulated depreciation of $10,319 and
            $9,786, respectively                                              12,602                    12,416
         Goodwill (Note 3)                                                     4,351                     5,295
         Asset purchase agreement receivable (Note 3)                            742
         Other Assets                                                          1,489                     1,566
                                                                      ---------------        ------------------
Total Assets                                                                 $60,398                   $56,381
                                                                      ===============        ==================
LIABILITIES & STOCKHOLDERS' EQUITY Current Liabilities:
            Accounts payable                                                 $10,328                    $8,317
            Accrued expenses & taxes                                           4,354                     4,753
            Advances from customers                                            8,627                     6,412
            Accrued installation & warranty costs                              1,141                     1,326
            Dividends payable                                                      -                       951
            Short - term debt                                                  2,461                     1,527
                                                                      ---------------        ------------------
                        Total current liabilities                             26,911                    23,286
         Long - term debt                                                      5,386                     5,283
         Postretirement benefit obligation                                     1,202                     1,213
         Long term pension obligation                                            592                       592
         Deferred income taxes                                                   193                       225
         Commitments and contingencies                                             -                         -
                                                                      ---------------        ------------------
                        Total Liabilities                                     34,284                    30,599
                                                                      ---------------        ------------------
         Stockholders' Equity:
            Preferred stock, par value $100, 1,000,000
                  shares authorized, no shares issued                              -                         -
            Common stock, par value $.01,
                 10,000,000 shares authorized,
                  6,142,106 shares issued                                         61                        61
            Paid in capital                                                   19,295                    19,295
            Treasury stock, 199,524 shares at  March 29, 1998
            and December 31, 1997                                               (984)                     (984)
            Retained earnings                                                  7,886                     7,776
            Accumulated other comprehensive expense                             (144)                     (366)
                                                                      ---------------        ------------------
                        Total Stockholders' Equity                            26,114                    25,782
                                                                      ---------------        ------------------
Total Liabilities and Stockholders' Equity                                   $60,398                   $56,381
                                                                      ===============        ==================
</TABLE>
           See Accompanying Notes to Consolidated Financial Statements




                                  Page 4 of 10
<PAGE>




                               FARREL CORPORATION
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                 (In thousands, except per share and share data)

<TABLE>
<CAPTION>

                                                               Three Months Ended
                                                               ------------------
                                                       March 29,            March 30,
                                                         1998                 1997
                                                      (unaudited)          (unaudited)
<S>                                                        <C>                   <C>    
Net Sales                                                  $15,976               $16,123

Cost of sales                                               11,740                12,785
                                                    ---------------     -----------------

Gross margin                                                 4,236                 3,338

Operating expenses:

    Selling                                                  1,732                 1,657

    General & administrative                                 1,769                 1,763

    Research & development                                     318                   390
                                                    ---------------     -----------------

Total operating expenses                                     3,819                 3,810
                                                    ---------------     -----------------

Operating income/(loss)                                        417                 (472)

Interest income                                                157                    54

Interest expense                                             (315)                  (10)

Other (expense) income, net                                   (76)                   256
                                                    ---------------     -----------------

Income(loss) before income taxes                               183                 (172)

(Provision) benefit for income taxes                          (73)                    66
                                                    ---------------     -----------------

Net income (loss)                                             $110                ($106)
                                                    ===============     =================

Per share data:

Basic and Diluted net income (loss)
    per common share                                         $0.02               ($0.02)
                                                    ===============     =================
Average shares outstanding:
   Basic                                                 5,942,582             5,942,382
                                                    ===============     =================
   Diluted                                               5,982,985             5,942,382
                                                    ===============     =================
</TABLE>
           See Accompanying Notes to Consolidated Financial Statements



                                  Page 5 of 10
<PAGE>






                               FARREL CORPORATION
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (In thousands)
<TABLE>
<CAPTION>

                                                                                  Three Months Ended
                                                                                  ------------------
                                                                             March 29,             March 30,
                                                                               1998                   1997
                                                                            (Unaudited)           (Unaudited)
Cash flows from operating activities:
<S>                                                                               <C>                <C>   
  Net Income/(loss)                                                               $110               ($106)
  Adjustments to reconcile net (loss)/income to net
  cash provided/(used in) by operating activities:
    Gain on disposal of fixed assets                                                 -                (299)
    Depreciation and amortization                                                  484                 413
    Decrease in accounts receivable                                                956               4,751
    (Increase) in inventory                                                     (4,539)             (6,725)
    Increase in accounts payable                                                 1,884                 663
    Increase in customer advances                                                3,143               1,736
    (Decrease) in accrued expenses & taxes                                        (712)               (303)
    (Decrease) in accrued installation and warranty costs                         (195)               (219)
    (Decrease)/increase in deferred income taxes                                   (38)                133
    Other                                                                         (318)                191
                                                                   --------------------    ----------------
    Total adjustments                                                              665                 341
                                                                   --------------------    ----------------
    Net cash provided by operating activities                                      775                 235
                                                                   --------------------    ----------------
Cash flows from investing activities:
    Proceeds from disposal of fixed assets                                           -                 444
    Purchases of property, plant and equipment                                    (460)                (67)
                                                                   --------------------    ----------------
    Net cash provided by/(used in) investing activities                           (460)                377
Cash flows from financing activities:
    Proceeds from short-term borrowing, net                                        891                   -
    Used for dividends paid                                                       (951)                  -
                                                                   --------------------    ----------------
    Net cash used by financing activities                                          (60)                  0
Effect of foreign currency exchange rate changes on cash                            17                 (81)
                                                                   --------------------    ----------------
Net increase in cash and cash equivalents                                          272                 531
    Cash and cash equivalents - Beginning of period                              1,447               3,832
                                                                   --------------------    ----------------
    Cash and cash equivalents - End of period                                   $1,719              $4,363
                                                                   ====================    ================
Income taxes paid                                                                 $106                 $45
                                                                   ====================    ================
Interest paid                                                                     $179                  $1
                                                                   ====================    ================
</TABLE>

           See Accompanying Notes to Consolidated Financial Statements



                                  Page 6 of 10
<PAGE>




                               Farrel Corporation
                   Notes to Consolidated Financial Statements
                                   (Unaudited)

Note 1 - Basis Of Presentation

         In the opinion of management,  the accompanying  unaudited consolidated
financial  statements  contain  all  adjustments,   consisting  only  of  normal
recurring adjustments, necessary to present fairly, in accordance with generally
accepted accounting  principles,  the consolidated  financial position of Farrel
Corporation  ("Farrel"  or  "the  Company")  as  of  March  29,  1998,  and  the
consolidated results of its operations and cash flows for the three months ended
March 29, 1998 and March 30, 1997. These results are not necessarily  indicative
of results to be expected for the full fiscal year. These  statements  should be
read in conjunction with the financial  statements and notes thereto included in
the Company's Annual Report and Form 10-K for the year ended December 31, 1997.

Note 2 - Inventory

<TABLE>
<CAPTION>

    Inventory is comprised of the following:             March 29,               December 31,
                                                           1998                      1997
                                                                   (In thousands)
<S>                                                       <C>                        <C>   
    Stock and raw materials.......................        $10,673                    $9,459
    Work-in process...............................         12,724                     8,818
                                                          -------                   -------
    Total.........................................        $23,397                   $18,277
                                                          =======                   =======
</TABLE>

    See also Note 3 regarding the valuation of the inventory  acquired from EIS.

Note 3 - Asset Purchase

     On December 19, 1997,  the Company  acquired  certain assets of the Francis
Shaw Rubber Machinery  operations  ("Shaw") from EIS Group PLC for approximately
$10.9  million.  The  Asset  Purchase  Agreement  ("Agreement")  provides  for a
reduction in the purchase price to the extent that the value of the closing date
inventory  was less than the  contract  amount.  The Company has objected to the
inventory  valuation.  In addition,  if the  acquired  assets do not generate at
least an approximately  $1.67 million pre-tax profit, as defined,  the Agreement
provides for a reduction in the purchase price. Included in total assets, with a
corresponding reduction in goodwill, is an amount due from the seller calculated
under the terms of the Agreement.

     The results of operations of Shaw are included in the consolidated  results
of  operations  of the Company.  The seller did not maintain and the Company was
not provided historical financial information for the Shaw operations.  Based on
the limited  information  available,  the Company  estimates  that the pro forma
revenues  and net loss for the three  months ended March 30, 1997 would not vary
materially from the historical  amounts recorded in the consolidated  statements
of operations.

Note 4 -  Comprehensive Income

         As of  January  1,  1998,  the  Company  adopted  Financial  Accounting
Standard No. 130, "Reporting Comprehensive Income". Standard No. 130 establishes
new  rules  for the  reporting  and  display  of  comprehensive  income  and its
components;  however,  the  adoption  of  the  statement  had no  impact  on the
Company's net income or stockholders equity.

         The  components of  comprehensive  income (loss),  for the  three-month
periods ended are as follows:

                                                      March 29,      March 30,
                                                        1998           1997
                                                        ----           ----
                                                           (In thousands)
         Net income (loss)                              $110          $(106)
         Foreign currency translation adjustments        222           (491)
                                                       -----          ------
         Comprehensive income (loss)                    $332          $(597)
                                                       =====          ======

                                  Page 7 of 10
<PAGE>




         The  components of  accumulated  other  comprehensive  expense,  net of
related tax, are as follows:

                                                     March 29,      December 31,
                                                        1998            1997
                                                        ----            ----
                                                           (In thousands)
         Minimum pension liability                    $(303)          $(303)
         Foreign currency translation adjustments       159             (63)
                                                      ------          ------
         Accumulated comprehensive expense            $(144)          $(366)
                                                      ======          ======



                                  Page 8 of 10
<PAGE>





PART II - OTHER INFORMATION


ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K

Exhibit 10(b)       Amendment   to   Employment  Agreement   between   Rolf   K.
                    Liebergesell and Farrel Corporation effective as of December
                    1, 1997  (incorporated  by reference to Exhibit 10(b) to the
                    Registrant's Quarterly  Report on Form 10-Q for the  quarter
                    ended March 29, 1998 (Commission File No. 0-19703)).

Exhibit 11          (Regulation  S-K)   Computation   of  Earnings   Per   Share
                    (incorporated by reference to Exhibit 11 to the Registrant's
                    Quarterly  Report on Form 10-Q for the  quarter  ended March
                    29, 1998 (Commission File No. 0-19703)).

Exhibit 27          Financial Data Schedule

Reports on Form 8-K

     No  Reports  on Form 8-K were filed by the  registrant  during the  periods
covered by this report.



                                  Page 9 of 10
<PAGE>






                                   SIGNATURES


PURSUANT  TO THE  REQUIREMENTS  OF THE  SECURITIES  EXCHANGE  ACT OF  1934,  THE
REGISTRANT  HAS DULY  CAUSED  THIS  AMENDMENT  TO ITS REPORT TO BE SIGNED ON ITS
BEHALF BY THE UNDERSIGNED THEREUNTO DULY AUTHORIZED.


                                            FARREL CORPORATION
                                            REGISTRANT




DATE: May 18, 1998                          /s/ ROLF K. LIEBERGESELL
                                            ------------------------------------
                                            ROLF K. LIEBERGESELL
                                            CHIEF EXECUTIVE OFFICER, PRESIDENT
                                            AND CHAIRMAN OF THE BOARD





DATE: May 18, 1998                          /s/ CATHERINE M. BOISVERT
                                            ------------------------------------
                                            CATHERINE M. BOISVERT
                                            VICE PRESIDENT AND CONTROLLER
                                            (CHIEF ACCOUNTING OFFICER)



                                 Page 10 of 10