SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-K


/X/  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE 
     ACT OF 1934
For the fiscal year ended December 31, 1998
                                       OR

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

For the transition period from __________ to __________

Commission file number 033-89746

                         WHEELING-PITTSBURGH CORPORATION
             (Exact name of registrant as specified in its charter)

                DELAWARE                         55-0309927
     (State or other jurisdiction of          (I.R.S. Employer
     incorporation or organization)          Identification No.)

           1134 Market Street                       26003
              Wheeling, WV                       (Zip code)
(Address of principal executive offices)

Registrant's telephone number, including area code:  212-355-5200
Securities registered pursuant to Section 12(b) of the Act:

                                                  Name of each exchange on
     Title of each class                             which registered
     -------------------                             ----------------

9 1/4% Senior Notes due 2007                               NA


       Indicate by check mark whether the  Registrant  (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
Registrant  was required to file such  reports) and (2) has been subject to such
filing requirements for the past 90 days. Yes /X/ No / /

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

       The  registrant  meets the  conditions  set forth in General  Instruction
I(1)(a)  and (b) of Form 10-K and is  therefore  filing  this Form with  reduced
disclosure format.

        Incorporation of documents by reference: None
<PAGE>
                                     PART I

ITEM 1. BUSINESS

OVERVIEW

            Wheeling-Pittsburgh   Corporation  ("WPC")  and  together  with  its
subsidiaries,  ( the "Company"), is a wholly owned subsidiary of WHX Corporation
("WHX").   Wheeling-Pittsburgh   Steel  Corporation  ("WPSC"),  a  wholly  owned
subsidiary of WPC, is the ninth largest domestic  integrated steel manufacturer.
The Company is a vertically  integrated  manufacturer of value-added flat rolled
steel  products.  The  Company  sells a broad  array  of  value-added  products,
including cold rolled steel,  tin and  zinc-coated  steels and fabricated  steel
products. The Company's products are sold to steel service centers,  converters,
processors,   the  construction   industry,  and  the  container  and  appliance
industries.

            The Company believes that it is one of the lowest cost domestic flat
rolled steel  producers.  The Company's low cost structure is the result of: (i)
the  restructuring  of its work rules and  staffing  requirements  under its new
five-year  labor  agreement  which settled a ten-month  strike in 1997; (ii) the
strategic  balance  between its basic steel  operations  and its  finishing  and
fabricating  facilities;  and (iii) its efficient  production of low cost,  high
quality metallurgical coke.

            The Company  believes  that its 1997 labor  agreement  is one of the
most  flexible in the  industry.  The new work rule package  affords the Company
substantially   greater  flexibility  in  reducing  its  overall  workforce  and
assigning and scheduling work, thereby reducing costs and increasing efficiency.
Furthermore,  the Company has achieved  pre-strike steel production  levels with
850 fewer employees (a reduction of approximately 20% in its hourly workforce).

            The Company has structured its operations so that its hot strip mill
and  downstream  operations  have greater  capacity than do its raw steel making
operations.  The Company  therefore can purchase  slabs and ship at greater than
100% of its  internal  production  capacity  in  periods of high  demand,  while
maintaining  the ability to curtail such  purchases  and still operate its basic
steel facilities at or near capacity during periods of lower demand. The Company
believes  this  flexibility  results in  enhanced  profitability  throughout  an
economic cycle. The Company also believes that it produces metallurgical coke at
a  substantially  lower  cost than do other  coke  manufacturers  because of its
proximity to high quality coal reserves and its efficient coke producing  plant.
This reduces the Company's  costs and, as coke demand  remains high,  allows the
Company to sell coke profitably in the spot and contract markets.


BUSINESS STRATEGY

            The Company's business strategy includes the following initiatives:

            IMPROVE COST  STRUCTURE.  The Company  continues to improve its cost
structure and enhance  productivity through job eliminations (850 positions were
eliminated in 1997,  approximately  20% of its pre-strike  hourly workforce) and
capital expenditures, upgrading and modernizing its steelmaking facilities.

            EXPAND PRODUCTION OF VALUE-ADDED PRODUCTS. The Company will continue
to expand  production of  value-added  products,  principally  through growth of
fabricated   products,   and  its   emphasis   on   joint   ventures,   such  as
Wheeling-Nisshin, Inc. ("Wheeling-Nisshin") and Ohio Coatings Company ("OCC").
<PAGE>
            The following table lists  operating  statistics for the Company and
the steel  industry (as reported by the American Iron and Steel  Institute)  for
the five-year period ending December 31, 1998.

<TABLE>
<CAPTION>
                                                                               Year Ended December 31,
                                                --------------------------------------------------------------------------------
                                                       1994            1995            1996(1)          1997(1)        1998(1)(2)
                                                       ----            ----            ----             ----           ----      
                                                                                  (Tons in millions)
<S>                                                    <C>             <C>             <C>              <C>            <C> 
Company Raw Steel Production ............              2.27            2.20            1.78             .66            2.45

            Capability ..................              2.40            2.40            2.40            2.40            2.40

            Utilization .................                95%             92%           98.9%             90%            102%

            Shipments ...................               2.4             2.4             2.1              .9             2.2

Industry Raw Steel Production(2) ........             100.6           104.9           105.3           108.6           107.6

            Capability ..................             108.2           112.4           116.1           121.4           125.3

            Utilization .................                93%             93%             91%             89%             86%

            Shipments ...................              95.1            97.5           100.9           105.9           102.1

</TABLE>
(1)         Results for 1996, 1997 and the first half of 1998 were affected by a
            ten-month  work  stoppage  at  the  Company's  primary  steel-making
            facilities  beginning  October 1, 1996. The utilization rate for the
            nine months prior to the work  stoppage was 98.9%.  The  utilization
            rate for the fourth quarter of 1997 was 90%.

(2)         Preliminary estimates regarding 1998.
<PAGE>
PRODUCTS AND PRODUCT MIX

            The table below reflects the historical product mix of the Company's
shipments,  expressed  as  a  percentage  of  tons  shipped.  Increases  in  the
percentage of higher value products have been realized  during the 1990's as (i)
fabricated products operations were expanded and (ii) Wheeling-Nisshin's  second
coating  line  increased  its  requirements  of cold  rolled  coils from WPC. In
addition,  the OCC joint venture  should enable the Company to increase tin mill
product  shipments  in 1999 up to an  additional  92,000  tons  compared to 1998
levels.
<TABLE>
<CAPTION>
                                                                                      Historical Product Mix
                                                                                      Year Ended December 31,
                                                            1994          1995          1996(1)      1997(1)       1998
                                                            ----          ----          ------       ------        ----
<S>                                                        <C>           <C>           <C>           <C>           <C>
PRODUCT CATEGORY:
Higher Value-Added Products:
     Cold Rolled Products--Trade                            10.5%          7.9%          8.4%          5.6%         11.0%
     Cold Rolled Products--Wheeling-Nisshin                 17.3          18.9          16.6           7.7          19.0
     Coated Products                                        21.7          21.3          21.5          12.3          17.5
     Tin Mill Products                                       7.2           7.1           7.5           3.3           7.1
     Fabricated Products                                    11.9          14.9          17.9          39.0          15.6
                                                            ----          ----          ----          ----          ----
Higher Value-Added Products as a Percentage
  of Total Shipments                                        68.6          70.1          71.9          67.9          70.2
Hot Rolled Products                                         31.4          29.9          28.1          20.0          29.5
Semi-Finished                                                 --            --            --          12.1           0.3
                                                            ----          ----          ----          ----          ----
Total                                                      100.0%        100.0%        100.0%        100.0%        100.0%
                                                           =====         =====         =====         =====         ===== 
AVERAGE NET SALES PER TON                                 $  498        $  532        $  528        $  576        $  496
</TABLE>
(1)  The allocation among product  categories was affected by the ten-month work
     stoppage.


            Products produced by the Company are described below. These products
are sold  directly to third party  customers,  and to  Wheeling-Nisshin  and OCC
pursuant to long-term supply agreements.

            COLD ROLLED PRODUCTS.  Cold rolled coils are  manufactured  from hot
rolled  coils  by  employing  a  variety  of  processing  techniques,  including
pickling,  cold reduction,  annealing and temper rolling. Cold rolled processing
is  designed   to  reduce  the   thickness   and  improve  the  shape,   surface
characteristics  and  formability  of the  product.  In its finished  form,  the
product  may be sold to  service  centers  and to a variety of end users such as
appliance or  automotive  manufacturers  or further  processed  internally  into
corrosion-resistant   coated   products   including   hot   dipped   galvanized,
electrogalvanized,  or tin mill  products.  In recent  years,  the  Company  has
increased   its  cold  rolled   production   to  support   increased   sales  to
Wheeling-Nisshin, which is labeled as a separate product category above.

            COATED   PRODUCTS.    The   Company   manufactures   a   number   of
corrosion-resistant,  zinc-coated  products  including hot dipped galvanized and
electrogalvanized  sheets for resale to trade accounts.  The coated products are
manufactured  from a steel  substrate of cold rolled or hot rolled pickled coils
by  applying  zinc to the  surface  of the  material  to enhance  its  corrosion
protection.  The  Company's  trade  sales of  galvanized  products  are  heavily
oriented to unexposed applications,  principally in the appliance, construction,
service center and automotive  markets.  Typical industry  applications  include
auto  underbody  parts,   culvert  pipe,   refrigerator  backs  and  heating/air
conditioning ducts. The Company sells electrogalvanized products for application
in the appliance and construction markets.

            TIN MILL  PRODUCTS.  Tin mill  products  consist of  blackplate  and
tinplate.  Blackplate is a cold rolled  substrate  (uncoated),  the thickness of
which is less than .0142 inches and is utilized  extensively in the  


                                      -3-
<PAGE>
manufacture of pails,  shelving and sold to OCC for the  manufacture of tinplate
products.  Tinplate is produced by the electro-deposition of tin to a blackplate
substrate and is utilized  principally  in the  manufacture  of food,  beverage,
general line and aerosol  containers.  While the majority of the Company's sales
of these products is concentrated in container markets, the Company also markets
products  for  automotive  applications,  such as oil filters and  gaskets.  The
Company has phased out its existing tin mill  facilities and produces all of its
tin coated products through OCC. WPSC expects that its participation in OCC will
enable it to expand WPSC's  presence in the tin plate market.  OCC's $69 million
tin coating mill, which commenced  commercial  operations in January 1997, has a
nominal  annual  capacity  of 250,000 net tons.  The  Company  will supply up to
230,000  tons of the  substrate  requirements  of the joint  venture  subject to
quality  requirements  and  competitive  pricing.  The  Company  will  act  as a
distributor of the joint venture's product.

            HOT ROLLED PRODUCTS.  Hot rolled coils represent the least processed
of the  Company's  finished  goods.  Approximately  70% of  the  Company's  1998
production of hot rolled coils was further processed internally into value-added
finished  products.  The balance of the  tonnage is sold as hot rolled  black or
pickled   (acid   cleaned)   coils   to  a   variety   of   consumers   such  as
converters/processors, steel service centers and the appliance industries.

            FABRICATED  PRODUCTS.  Fabricated products consist of cold rolled or
coated  products  further  processed  mainly  via roll  forming  and sold in the
construction, highway, and agricultural products industries.

                        Construction Products.  Construction products consist of
roll-formed  sheets,  which  are  utilized  in  sectors  of the  non-residential
building market such as commercial,  institutional and  manufacturing.  They are
classified  into three basic  categories:  roof deck;  form deck;  and composite
floor deck.  Roof deck is a formed steel  sheet,  painted or  galvanized,  which
provides structural support in non-residential  roofing systems.  Form deck is a
formed steel sheet,  painted,  galvanized or uncoated,  that provides structural
form support for  structural or  insulating  concrete  slabs in  non-residential
floor or roofing systems. Composite floor deck is a formed steel sheet, painted,
galvanized  or  uncoated,  that  provides  structural  form support and positive
reinforcement for structural concrete slabs in non-residential floor systems.

                        Agricultural Products.  Agricultural products consist of
roll-formed,  corrugated  sheets  which are used as  roofing  and  siding in the
construction of barns, farm machinery  enclosures and light commercial buildings
and certain residential roofing applications. These products can be manufactured
from hot dipped or painted  hot dipped  galvanized  coils.  Historically,  these
products have been sold primarily in rural areas. In recent years, however, such
products have found increasing acceptance in light commercial buildings.

                        Highway  Products.  Highway  products  consist of bridge
form, which is roll-formed  corrugated  sheets that are swedged on both ends and
are utilized as concrete support forms in the construction of highway bridges.

WHEELING-NISSHIN

            The Company owns a 35.7% equity interest in Wheeling-Nisshin,  which
is a joint  venture  between the Company and Nisshin  Holding,  Incorporated,  a
wholly-owned  subsidiary  of  Nisshin  Steel  Co.,  Ltd.  Wheeling-Nisshin  is a
state-of-the-art  processing facility located in Follansbee, West Virginia which
produces among the lightest  gauge  galvanized  steel products  available in the
United  States.   Shipments  by   Wheeling-Nisshin  of  hot  dipped  galvanized,
galvanneal,  galvalume and aluminized products,  principally to the construction
industry,  have  increased  from  158,600  tons in 1988 to 702,700 tons in 1998.
Wheeling-Nisshin  products  are  marketed  through  trading  companies,  and its
shipments are not consolidated into the Company's shipments.

            Wheeling-Nisshin began commercial operations in 1988 with an initial
capacity of 360,000  tons.  In March 1993,  Wheeling-Nisshin  added a second hot
dipped  galvanizing line, which increased its capacity by approximately  94%, to
over 700,000 annual tons and allows Wheeling-Nisshin to offer the lightest-gauge
galvanized  sheet products  manufactured in the United States for  construction,
heating,   ventilation  and

                                      -4-
<PAGE>
air-conditioning   and   after-market   automotive applications.

            The   Company's   amended  and  restated   supply   agreement   with
Wheeling-Nisshin  expires in 2013. Pursuant to the amended supply agreement, the
Company will  provide not less than 75% of  Wheeling-Nisshin's  steel  substrate
requirements,  up to an  aggregate  maximum  of 9,000  tons per week  subject to
product quality  requirements.  Pricing under the supply agreement is negotiated
quarterly  based on a formula which gives effect to  competitive  market prices.
Shipments  of  cold  rolled  steel  by  the  Company  to  Wheeling-Nisshin  were
approximately 428,000 tons, or 19.1% of the Company's total tons shipped in 1998
and approximately  66,500 tons, or 7.8%, in 1997.  Shipments to Wheeling Nisshin
in 1997 were negatively affected by the strike.


OHIO COATINGS COMPANY

            The Company  has a 50.0%  equity  interest in OCC,  which is a joint
venture between the Company and Dong Yang, a leading South Korea-based tin plate
producer. Nittetsu Shoji America ("Nittetsu"),  a U.S. based tin plate importer,
holds  non-voting  preferred  stock in OCC. OCC completed  construction of a $69
million  state-of-the-art  tin  coating  mill in 1996 and  commenced  commercial
operations in January 1997.  The OCC  tin-coating  facility is the only domestic
electro-tin plating facility  constructed in the past 30 years and is positioned
to  become a  premier  supplier  of tin plate to the  container  and  automotive
industries.  The OCC tin coating line is  anticipated  to have a nominal  annual
capacity of 250,000 net tons, and shipped  approximately 71,000 tons in 1997 and
138,000  tons in 1998.  The  Company  has phased out its  existing  tin  coating
facilities and produces all of its tin coated  products  through OCC. As part of
the joint venture  agreement,  the Company has the right to supply up to 230,000
tons of the  substrate  requirements  of OCC through  the year 2012,  subject to
quality  requirements  and competitive  pricing.  The Company will market all of
OCC's products partially through Nittetsu. In 1997 and 1998 OCC had an operating
loss of $14.3 million and  operating  income of $.3 million,  respectively.  The
1997 results reflected OCC's start-up,  inability to source substrate during the
1997 strike and competitive market conditions for tinplate.

OTHER STEEL RELATED OPERATIONS OF THE COMPANY

            The Company owns an  electrogalvanizing  facility which had revenues
of $45.7  million in 1998 and $34.8 million in 1997,  while  providing an outlet
for  approximately  60,000  tons of steel in a normal  year and a facility  that
produces oxygen and other gases used in the Company's  steel-making  operations.
The  Company  also  has a 12 1/2%  ownership  interest  in  Empire  Iron  Mining
Partnership ("Empire"), which operates a mine located in Palmer, Michigan.

CUSTOMERS

            The Company  markets an extensive mix of products to a wide range of
manufacturers,  converters and  processors.  The Company's 10 largest  customers
(including  Wheeling-Nisshin)  accounted for approximately 34.9%of its net sales
in 1996,  30.2%  in 1997,  and  39.7%  in  1998.  Wheeling-Nisshin  was the only
customer  to  account  for  more  than  10% of  net  sales  in  1996  and  1998.
Wheeling-Nisshin  accounted  for  12.7% and 14.6% of net sales in 1996 and 1998,
respectively.  No single  customer  accounted  for more than 10% of net sales in
1997. Geographically, the majority of the Company's customers are located within
a 350-mile radius of the Ohio Valley.  However,  the Company has taken advantage
of its  river-oriented  production  facilities  to market  via  barge  into more
distant locations such as the Houston,  Texas and St. Louis, Missouri areas. The
Company has also acquired regional  fabricated  product facilities to service an
even broader geographical area.


                                      -5-
<PAGE>
            The Company's  shipments  historically have been concentrated within
seven major  market  segments:  steel  service  centers,  converters/processors,
construction,  agriculture, container, automotive, and appliances. The Company's
overall participation in the construction and the converters/processors  markets
substantially  exceeds  the  industry  average and its  reliance  on  automotive
shipments as a percentage  of total  shipments  is  substantially  less than the
industry average.

                        Percent Of Total Net Tons Shipped
<TABLE>
<CAPTION>
                                                                      Year Ended December 31,
MAJOR CUSTOMER CATEGORY:                  1994            1995           1996(1)         1997(1)          1998(1)
-----------------------                   ----            ----           ------          ------           ------ 

<S>                                       <C>             <C>             <C>             <C>             <C> 
Steel Service Centers                      32%             29%             26%             32%             29%
Converters/Processors(2)                   28              28              25              16              32
Construction                               18              18              22              31              19
Agriculture                                 5               6               7              14               6
Containers(2)                               6               6               7               2               8
Automotive                                  6               5               5               2               1
Appliances                                  3               4               4               2               2
Exports                                    --               1               1              --               1
Other                                       2               3               3               1               2
                                          ---             ---             ---             ---             --- 
     Total                                100%            100%            100%            100%            100%
                                          ===             ===             ===             ===             === 
</TABLE>
(1)  The allocation among customer categories was affected by the ten-month work
     stoppage.

(2)  Products shipped to Wheeling-Nisshin  and OCC are included primarily in the
     Converters/Processors and Containers markets, respectively.

            Set forth below is a  description  of the Company's  major  customer
categories:

            STEEL  SERVICE  CENTERS.  The  Company's  shipments to steel service
centers  are  heavily  concentrated  in the areas of hot  rolled  and hot dipped
galvanized coils. Due to increased  in-house costs to steel companies during the
1980's for processing  services such as slitting,  shearing and blanking,  steel
service  centers  have become a major factor in the  distribution  of hot rolled
products to ultimate end users. In addition, steel service centers have become a
significant factor in the sale of hot dipped galvanized products to a variety of
small  consumers such as mechanical  contractors,  who desire not to be burdened
with large steel inventories.

            CONVERTERS/PROCESSORS.  The growth of the Company's shipments to the
converters/processors  market is  principally  attributable  to the  increase in
shipments of cold rolled  products to  Wheeling-Nisshin,  which uses cold rolled
coils as a substrate to manufacture a variety of coated products,  including hot
dipped  galvanized  and  aluminized  coils  for the  automotive,  appliance  and
construction  markets.  As a result of the second line expansion,  the Company's
shipments to  Wheeling-Nisshin  increased  significantly  beginning in 1993. The
converters/processors  industry also represents a major outlet for the Company's
hot rolled products, which are converted into finished commodities such as pipe,
tubing and cold rolled strip.

            CONSTRUCTION.  The Company's shipments to the construction  industry
are heavily  influenced by fabricated  product sales.  The Company  services the
non-residential and agricultural  building and highway  industries,  principally
through  shipments of hot dipped  galvanized  and painted cold rolled  products.
With its acquisitions during the 1980's and early 1990's of regional facilities,
the Company has doubled its fabricated  products  shipments and has been able to
market its products into broad geographical areas.

            AGRICULTURE.  The Company's shipments to the agricultural market are
principally  sales of roll-formed,  corrugated  sheets which are used as roofing
and siding in the  construction  of barns,  farm machinery  enclosures and light
commercial buildings.

                                      -6-
<PAGE>
            CONTAINERS.  The vast  majority of the  Company's  shipments  to the
container  market are  concentrated  in tin mill  products,  which are  utilized
extensively in the manufacture of food, aerosol, beverage and general line cans.
The  container  industry has  represented  a stable  market.  The balance of the
Company's  shipments to this market  consists of cold rolled  products for pails
and drums.  As a result of the OCC joint  venture,  the  Company  phased out its
existing tin mill production facilities in 1996, and has begun to sell substrate
to, and to distribute products produced by, OCC.

            AUTOMOTIVE.  Unlike the majority of its competitors,  the Company is
not heavily  dependent on shipments to the  automotive  industry.  However,  the
Company  seeks  to  establish   higher   value-added   niches  in  this  market,
particularly  in the area of hot  dipped  galvanized  products  for  deep  drawn
automotive underbody parts. In addition,  the Company has been a supplier of tin
mill products for automotive applications, such as oil filters and gaskets. As a
result of the strike, the Company was unable to secure automotive  contracts for
1998. The Company will compete for automotive contracts in future periods.

            APPLIANCE.  The  Company's  shipments  to the  appliance  market are
concentrated in hot dipped galvanized,  electrogalvanized  and hot rolled coils.
These products are furnished  directly to appliance  manufacturers as well as to
blanking,  drawing and  stamping  companies  that supply  OEMs.  The Company has
concentrated  on niche  product  applications  primarily  used in  washer/dryer,
refrigerator/freezer  and  range  appliances.  The  Company  expects  to be in a
favorable position to compete for contracts to supply appliance manufacturers in
1999 and future periods.


MANUFACTURING PROCESS

            In the  Company's  primary  steelmaking  process,  iron ore pellets,
coke,  limestone,  sinter  and other raw  materials  are  consumed  in the blast
furnace to produce hot metal.  Hot metal is further  converted into liquid steel
through its basic oxygen furnace ("BOF")  process where  impurities are removed,
recycled scrap is added and metallurgical  properties for end use are determined
on a batch-by-batch (heat) basis. The Company's BOF has two vessels, each with a
steelmaking  capacity of 285 tons per heat. From the BOF, the heats of steel are
sent to the  ladle  metallurgy  facility  ("LMF"),  where  the  temperature  and
chemistry of the steel are adjusted to precise tolerances. Liquid steel from the
LMF then is formed into slabs through the process of continuous  casting.  After
continuous  casting,  slabs are  reheated,  reduced and  finished  by  extensive
rolling,  shaping,  tempering  and,  in certain  cases,  by the  application  of
coatings at the Company's downstream operations.  Finished products are normally
shipped to customers in the form of coils or  fabricated  products.  The Company
has  linked  its  steelmaking  and  rolling  equipment  with  a  computer  based
integrated  manufacturing  control system to coordinate  production tracking and
sales activities.

RAW MATERIALS

            The  Company  has a 12.5%  ownership  interest in Empire Iron Mining
Partnership  which operates a mine located in Palmer,  Michigan.  The Company is
obligated to purchase approximately 12.5% or 1.0 million gross tons per year (at
current production levels) of the mine's annual ore output.  Interest in related
ore  reserves as of December 31,  1998,  is  estimated to be 19.8 million  gross
tons. The Company  generally  consumes  approximately  2.4 million gross tons of
iron ore pellets in its blast  furnaces.  The Company's pro rata cash  operating
cost of Empire  currently  approximates  the market  price of ore.  The  Company
obtains  approximately  half of its iron ore from spot and medium-term  purchase
agreements  at  prevailing  world  market  prices.  It has  commitments  for the
majority of its blast  furnace  iron ore pellet  needs  through  2000 from world
class suppliers.

            In 1993 the Company sold the operating assets of its coal company to
an  unrelated  third party.  The Company  also  entered into a long-term  supply
agreement  with such  third  party to provide  the  Company  with a  substantial
portion of the Company's metallurgical coal requirements at competitive prices.
The Company's coking  operations  require a substantial  amount of metallurgical
coal.

                                       -7-
<PAGE>

            The Company  currently  produces coke in excess of its  requirements
and typically consumes generally all of the resultant  by-product coke oven gas.
In 1998,  approximately  1.7 million  tons of coking  coal were  consumed in the
production  of blast  furnace coke by the  Company.  The Company may continue to
sell its excess coke and coke oven by-products to third-party trade customers.

            The  Company's  operations  require  material  amounts  of other raw
materials,  including limestone, oxygen, natural gas and electricity.  These raw
materials  are readily  available  and are  purchased  on the open  market.  The
Company is presently  dependent on external steel scrap for  approximately 8% of
its steel melt. The cost of these materials has been  susceptible in the past to
price  fluctuations,  but  worldwide  competition  in  the  steel  industry  has
frequently  limited the ability of steel  producers  to raise  finished  product
prices to recover higher material  costs.  Certain of the Company's raw material
supply  contracts  provide  for  price  adjustments  in the  event of  increased
commodity or energy prices.

BACKLOG

            Order backlog was 365,622 net tons at December 31, 1998, compared to
368,025 net tons at December 31, 1997.  The Company  believes  that the December
31, 1998 order backlog will be shipped by June 30, 1999.

CAPITAL INVESTMENTS

            The Company  believes  that it must  continuously  strive to improve
productivity, product quality and control manufacturing costs in order to remain
competitive.  Accordingly,  the  Company  is  committed  to  continuing  to make
necessary capital investments with the objective of reducing manufacturing costs
per ton,  improving the quality of steel  produced and  broadening  the array of
products  offered  to  the  Company's  served  markets.  The  Company's  capital
expenditures  (including capitalized interest) for 1998 were approximately $33.6
million,  including $9.5 million on environmental projects. Capital expenditures
in 1997 and 1998 were lower than in recent years due to the strike. From 1994 to
1998, such expenditures  aggregated  approximately $249.2 million. This level of
capital  expenditures  was  needed  to  maintain  productive  capacity,  improve
productivity  and upgrade selected  facilities to meet competitive  requirements
and maintain  compliance with  environmental  laws and regulations.  The capital
expenditure program has included  improvements to the Company's  infrastructure,
blast furnaces,  steel-making  facilities,  80-inch hot strip mill and finishing
operations,  and has  resulted in improved  shape,  gauge,  surface and physical
characteristics  for  its  products.  Continuous  and  substantial  capital  and
maintenance  expenditures  will be required to  maintain  operating  facilities,
modernize  finishing  facilities  to  remain  competitive  and  to  comply  with
environmental control requirements.  The Company anticipates funding its capital
expenditures in 1999 from cash on hand and funds  generated by operations,  sale
of receivables  under the  Receivables  Facility and funds  available  under the
Revolving  Credit  Facility.  During the 1997  strike,  the  Company had delayed
substantially  all  capital  expenditures  at the  strike-affected  plants.  The
Company anticipates that capital  expenditures will approximate  depreciation on
average, over the next few years.

ENERGY REQUIREMENTS

            During  1998 coal  constituted  approximately  76% of the  Company's
total  energy  consumption,  natural  gas 20% and  electricity  4%.  Many of the
Company's  major  facilities  that use  natural  gas have been  equipped  to use
alternative  fuels. The Company  continually  monitors its operations  regarding
potential equipment conversion and fuel substitution to reduce energy costs.

EMPLOYMENT

            Total active  employment of the Company at December 31, 1998 totaled
4,238 employees,  of which 3,204 were represented by the United  Steelworkers of
America  ("USWA"),  and 120 by other  unions.  The  remainder  consisted  of 852
salaried employees and 62 non-union operating employees.

                                       -8-
<PAGE>
            On August 12,  1997,  the  Company and the USWA  entered  into a new
five-year labor agreement.

COMPETITION

            The  steel  industry  is  cyclical  in  nature  and has been  marked
historically  by  overcapacity,  resulting in intense  competition.  The Company
faces increasing competitive pressures from other domestic integrated producers,
minimills and  processors.  Processors  compete with the Company in the areas of
slitting, cold rolling and coating. Minimills are generally smaller volume steel
producers that use ferrous scrap metals as their basic raw material. Compared to
integrated  producers,  minimills,  which rely on less capital  intensive  steel
production methods,  have certain advantages.  Since minimills typically are not
unionized,  they have more  flexible  work  rules  that have  resulted  in lower
employment  costs per net ton  shipped.  Since  1989,  significant  flat  rolled
minimill  capacity has been  constructed  and these  minimills  now compete with
integrated  producers  in  product  areas  that  traditionally  have  not  faced
significant  competition  from  minimills.  In  addition,  there is  significant
additional  flat rolled minimill  capacity under  construction or announced with
completion dates sometime in 1999. Near term, these minimills and processors are
expected to compete  with the Company  primarily  in the  commodity  flat rolled
steel market.  In the long-term,  such minimills and processors may also compete
with the Company in producing value-added  products. In addition,  the increased
competition in commodity product markets influence certain integrated  producers
to increase product offerings to compete with the Company's custom products.

            As the single largest steel consuming  country in the western world,
the United States has long been a favorite  market of steel  producers in Europe
and Japan. In addition,  steel  producers from Korea,  Taiwan,  and Brazil,  and
non-market  economies such as Russia and China,  have also recognized the United
States as a target market.

            Total annual steel  consumption  in the United  States has increased
from 88 million to slightly  over 117 million tons since 1991. A number of steel
substitutes,  including plastics,  aluminum,  composites and glass, have reduced
the growth of domestic steel consumption.

            Steel  imports of flat rolled  products as a percentage  of domestic
apparent consumption, excluding semi-finished steel, have been approximately 19%
in 1996,  20% in 1997  and 27% in 1998.  Imports  surged  in 1998 due to  severe
economic  conditions in Southeast Asia, Latin America,  Japan and Russia,  among
others.  World steel demand, world export prices, U.S. dollar exchange rates and
the international  competitiveness  of the domestic steel industry have all been
factors in these import levels.


ITEM 2.  PROPERTIES

            The Company  has one raw steel  producing  plant and  various  other
finishing and fabricating facilities.  The Steubenville complex is an integrated
steel producing  facility located at Steubenville  and Mingo Junction,  Ohio and
Follansbee,  West Virginia.  The  Steubenville  complex includes a sinter plant,
coke oven  batteries  that produce all coke  requirements,  two operating  blast
furnaces, two basic oxygen furnaces, a two-strand continuous slab caster with an
annual slab production  capacity of  approximately  2.4 million tons, an 80-inch
hot strip mill and pickling  and coil  finishing  facilities.  The Ohio and West
Virginia  locations,  which are separated by the Ohio River,  are connected by a
railroad bridge owned by the Company.  A pipeline is maintained for the transfer
of coke oven gas for use as fuel from the coke plant to several  other  portions
of the Steubenville  complex.  The Steubenville  complex primarily  produces hot
rolled  products,  which are either sold to third parties or shipped to other of
the Company's facilities for further processing into value-added products.


                                      -9-
<PAGE>
            The following table lists the other principal  plants of the Company
and the annual capacity of the major products produced at each facility:

<TABLE>
<CAPTION>
                                                   OTHER MAJOR FACILITIES
          LOCATION AND OPERATIONS                          CAPACITY TONS/YEAR        MAJOR PRODUCTS
<S>                                                        <C>                       <C>
Allenport, Pennsylvania:
  Continuous pickler, tandem mill, temper                  950,000                   Cold rolled sheets
  mill and annealing
Beech Bottom, West Virginia:
  Paint line                                               120,000                   Painted steel in coil form
Canfield, Ohio:
  Electrogalvanizing line, paint line, ribbon              65,000                    Electrolytic galvanized sheet and strip
  and oscillating rewind slitters
Martins Ferry, Ohio:                                       750,000                   Hot dipped galvanized sheets and coils
    Temper mill, zinc coating lines Yorkville, Ohio:
Continuous pickler, tandem mill, temper mills and
    annealing lines                                        660,000                   Black plate and cold rolled sheets
</TABLE>
            All of the  above  facilities  currently  owned by the  Company  are
regularly  maintained  in good  operating  condition.  However,  continuous  and
substantial  capital and maintenance  expenditures  are required to maintain the
operating  facilities,  to  modernize  finishing  facilities  in order to remain
competitive and to meet environmental control requirements.

            The  Company  has  fabricated  products  facilities  at Fort  Payne,
Alabama;  Houston,  Texas; Lenexa, Kansas;  Louisville,  Kentucky;  Minneapolis,
Minnesota;  Warren, Ohio; Gary, Indiana;  Wilmington, North Carolina and Klamath
Falls, Medford and Brooks, Oregon.

            The Company  maintains  regional sales offices in Atlanta,  Chicago,
Detroit, Philadelphia and Pittsburgh.



ITEM 3.  LEGAL PROCEEDINGS

ENVIRONMENTAL MATTERS

            The Company,  as are other industrial  manufacturers,  is subject to
increasingly  stringent standards relating to the protection of the environment.
In order to  facilitate  compliance  with  these  environmental  standards,  the
Company has incurred  capital  expenditures for  environmental  control projects
aggregating  $6.8  million,  $12.4  million and $9.5 million for 1996,  1997 and
1998, respectively. The Company anticipates spending approximately $30.8 million
in the aggregate on major  environmental  compliance  projects  through the year
2002, estimated to be spent as follows:  $7.5 million in year 1999, $7.3 million
in 2000,  $7.2 million in 2001 and $8.8 million in 2002. Due to the  possibility
of unanticipated  factual or regulatory  developments,  the amount and timing of
future expenditures may vary substantially from such estimates.

            The Company has been identified as a potentially  responsible  party
under the Comprehensive  Environmental Response,  Compensation and Liability Act
("Superfund")  or similar state statutes at several waste sites.  The Company is
subject to joint and  several  liability  imposed by  Superfund  on  potentially
responsible parties. Due to the technical and regulatory  complexity of remedial
activities and the difficulties attendant to identifying potentially responsible
parties and  allocating  or  determining  liability  among them,  the Company is
unable to reasonably  estimate the ultimate cost of  compliance  with  Superfund
laws. The Company believes,  based upon information  currently  available,  that
it's liability for clean up and remediation costs in connection with the Buckeye
Reclamation  will be between $2.5 million and $3.0 million.  At five 

                                      -10-

<PAGE>
other sites (MIDC  Glassport,  Tex-Tin,  Breslube Penn, Four County Landfill and
Beazer) the Company estimates the costs to approximate $500,000.  The Company is
currently funding its share of remediation costs.

            The Clean Air Act  Amendments of 1990 ("the Clean Air Act") directly
affect the operations of many of the Company's facilities, including coke ovens.
The Company is presently in compliance with the provisions of the Act.  However,
under the Clean Air Act,  coke ovens  generally  will be required to comply with
progressively  more  stringent  standards  which will  result in an  increase in
environmental capital expenditures and costs for environmental  compliance.  The
forecasted  environmental  expenditures  include  amounts which will be spent on
projects relating to compliance with these standards.

            In  March  1993  the EPA  notified  the  Company  of  Clean  Air Act
violations, alleging particulate matter and hydrogen sulfide emissions in excess
of allowable concentrations, at the Company's Follansbee Coke Plant. The parties
have entered into a consent decree settling the civil penalties  related to this
matter for $700,000 and the Company  completed payment of all civil penalties in
January 1997.

            In an  action  brought  in 1985 in the U.S.  District  Court for the
Northern  District of West  Virginia,  the EPA claimed  violations  of the Solid
Waste Disposal Act at a surface impoundment area at the Follansbee facility. The
Company and the EPA entered  into a consent  decree in October 1989 whereby soil
and  groundwater  testing and monitoring  procedures  are required.  The surface
impoundment  has been removed and a final closure plan has been submitted to the
USEPA. The Company is waiting for approval from the USEPA to implement the plan.
Until the USEPA responds to the Company, the full extent and cost of remediation
cannot be ascertained.

            In June of 1995 the USEPA  informally  requested  corrective  action
affecting  other areas of the Follansbee  facility.  The USEPA sought to require
the Company to perform a site investigation of the Follansbee plant. The Company
actively contested the USEPA's jurisdiction to require a site investigation, but
subsequently entered into a final administrative order with the USEPA to conduct
a Resource Conservation and Recovery Act ("RCRA") facility investigation.

            By letter dated March 15, 1994 the Ohio Attorney General advised the
Company  of its  intention  to file suit on  behalf of the Ohio EPA for  alleged
hazardous  waste  violations  at the  Company's  Steubenville,  Mingo  Junction,
Martins Ferry and Yorkville facilities.  In subsequent  correspondence the State
of Ohio demanded a civil penalty of  approximately  $300,000.  Negotiations  for
settlement of past violations is on-going.

            In January 1998 the Ohio Attorney  General notified the Company of a
draft consent order and initial civil  penalties in the amount of $1 million for
various  air  violations  at  the  Company's  Steubenville  and  Mingo  Junction
facilities   occurring  from  1992  through  1996.  The  Company   entered  into
discussions  with the Ohio  Environmental  Enforcement  Section to resolve these
issues.

            The Company is currently  operating in substantial  compliance  with
three consent decrees (two with the EPA and one with the Pennsylvania Department
of Environmental  Resources) with respect to wastewater discharges at Allenport,
Pennsylvania and Mingo Junction,  Steubenville,  and Yorkville, Ohio. All of the
foregoing  consent decrees are nearing  expiration.  A petition to terminate the
Allenport consent decree was filed in 1998.

            The  Company  is  aware  of  potential   environmental   liabilities
resulting from operations, including leaking underground and aboveground storage
tanks, and the disposal and storage of residuals on its property.  Each of these
situations  is being  assessed and  remediated  in  accordance  with  regulatory
requirements.

            Non-current accrued environmental  liabilities totaled $10.6 million
at December 31, 1997 and $12.7 million at December 31, 1998. As new  information
becomes available including  information provided by third parties, and changing
laws and  regulation,  the  liabilities  are reviewed and the accruals  adjusted
quarterly. Management believes, based on its best estimate, that the Company has
adequately provided for its present

                                      -11-
<PAGE>
environmental obligations.

            Based upon information currently available,  including the Company's
prior capital expenditures, anticipated capital expenditures, consent agreements
negotiated  with  Federal and state  agencies and  information  available to the
Company on pending judicial and administrative proceedings, the Company does not
expect  its  environmental   compliance  costs,   including  the  incurrence  of
additional  fines  and  penalties,  if any,  relating  to the  operation  of its
facilities,  to have a material  adverse  effect on the  financial  condition or
results of operations of the Company. However, as further information comes into
the Company's possession, it will continue to reassess such evaluations.

GENERAL LITIGATION

            On October  27,  1998,  the  Company  filed a  complaint  in Belmont
County, Ohio against ten trading companies, two Japanese mills and three Russian
mills  alleging  that it had been  irreparably  harmed  as a result  of sales of
hot-rolled  steel by the defendants at prices below the cost of production.  The
Company  asked the Court  for  injunctive  relief to  prohibit  such  sales.  On
November  6, 1998,  defendants  removed the case from  Belmont  County to the US
District Court for the Southern  District of Ohio. The Company filed a motion in
the US District Court asking the Court to remand the case to Belmont County.  On
November 19, 1998, the US District  Court denied the Company's  motion to remand
the case to Belmont  County.  However,  the Court permitted the Company to amend
its  complaint to allege  violations  of federal law. On November 20, 1998,  the
Company filed an amended complaint in the US District Court against nine trading
companies.  The  Company  added a claim  under the 1916  Antidumping  Act to its
existing  state law  claims.  The amended  complaint  seeks  treble  damages and
injunctive relief.

            The  defendants  filed a motion to  dismiss  the  Company's  amended
complaint and a motion to strike the  Company's  request for  injunctive  relief
under the 1916  Act.  The  Court  granted  defendants'  motion  to  dismiss  the
Company's state law causes of action,  but denied  defendants' motion to dismiss
the  Company's  claims  under the 1916  Antidumping  Act.  The Court has not yet
issued its decision on  defendants'  motion to strike the Company's  request for
injunctive  relief.  The case has been set for trial on  August  16,  1999.  The
Company has reached out-of-court settlements with four of the nine steel trading
companies  named in its 1916 Act law suit.  While terms of the  settlements  are
confidential,  the settling  defendants  agreed to certain  restrictions  on the
importation of foreign steel in the future and agreed to purchase  certain steel
products from the Company.

            The  Company  is a party to  various  litigation  matters  including
general  liability  claims  covered by insurance.  In the opinion of management,
such claims are not expected to have a material  adverse effect on the financial
condition or results of operations of the Company.


                                      -12-
<PAGE>
ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

                                    OMITTED




                                     PART II

ITEM 5.  MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED SECURITY HOLDER
         MATTERS

                                    NOT APPLICABLE


                                      -13-
<PAGE>
ITEM 6 SELECTED FINANCIAL DATA

FIVE-YEAR STATISTICAL (THOUSANDS OF DOLLARS)
<TABLE>
<CAPTION>
====================================================================================================================================
                                                                 1994          1995           1996*           1997*         1998
====================================================================================================================================
<S>                                                         <C>            <C>            <C>            <C>            <C>        
CONSOLIDATED STATEMENT OF OPERATIONS (IN THOUSANDS):
Net sales                                                   $ 1,193,878    $ 1,267,869    $ 1,110,684    $   489,662    $ 1,111,541
Cost of products sold (excluding
  depreciation and profit sharing)                              980,044      1,059,622        988,161        585,609        950,080
Depreciation                                                     61,094         65,760         66,125         46,203         76,321
Profit sharing                                                    9,257          6,718           --             --             --
Selling, administrative and general expense                      60,832         55,023         54,903         52,222         61,523
Special charge                                                     --             --             --           92,701           --
------------------------------------------------------------------------------------------------------------------------------------
Operating income (loss)                                          82,651         80,746          1,495       (287,073)        23,617

Interest expense on debt                                         22,581         22,431         23,763         27,204         36,699
Other income (expense)                                            6,731          3,234          9,476           (221)         3,478
B & LE settlement                                                36,091           --             --             --             --
------------------------------------------------------------------------------------------------------------------------------------
Income (loss) before taxes, extraordinary items
   and change in accounting method                              102,892         61,549        (12,792)      (314,498)        (9,604)
Tax provision (benefit)                                          21,173          3,030         (7,509)      (110,035)        (3,101)
------------------------------------------------------------------------------------------------------------------------------------
Income (loss) before extraordinary items
  and change in accounting method                                81,719         58,519         (5,283)      (204,463)        (6,503)
Extraordinary items - net of tax                                   --           (3,043)          --          (25,990)          --
Cumulative effect on prior years of accounting
   change - net of tax                                           (9,984)          --             --             --             --
------------------------------------------------------------------------------------------------------------------------------------
Net income (loss)                                                71,735         55,476         (5,283)      (230,453)        (6,503)
Preferred stock dividends                                         5,688           --             --             --             --
------------------------------------------------------------------------------------------------------------------------------------
Net income (loss) available to common stock                 $    66,047    $    55,476    $    (5,283)   $  (230,453)   $    (6,503)
====================================================================================================================================
FINANCIAL POSITION:
Cash, cash equivalents and short term investments           $    12,778    $    42,826    $    35,950    $      --      $     6,731
Working capital                                                 141,913        147,799        109,022          9,169         43,836
Property, plant and equipment - net                             732,615        748,999        710,999        694,108        651,086
Plant additions and improvements                                 69,139         81,554         31,188         33,755         33,595
Total assets                                                  1,266,372      1,340,035      1,245,892      1,424,568      1,256,367
====================================================================================================================================
Long-term debt (including current portion)                      292,825        288,740        269,414        350,103        349,992
Stockholders' equity                                            246,194        343,770        338,487        114,712        171,282
====================================================================================================================================
EMPLOYMENT
Employment costs                                            $   328,584    $   325,976    $   303,115    $   183,550    $   283,304
Average number of employees                                       5,402          5,333          5,228          3,878          4,296
====================================================================================================================================
PRODUCTION AND SHIPMENTS:
Raw steel production - tons                                   2,270,000      2,199,000      1,782,000        663,000      2,446,000
Shipments of steel products - tons                            2,397,000      2,385,000      2,105,000        851,000      2,243,000
====================================================================================================================================
</TABLE>

WHEELING-PITTSBURGH CORPORATION

*    The financial results of the Company for the fourth quarter of 1996 and all
     of 1997 were adversely affected by the strike.

                                      -14-
<PAGE>
NOTES TO FIVE-YEAR STATISTICAL SUMMARY

      The Company adopted  Statement of Financial  Accounting  Standard No. 112,
"Accounting for Postemployment  Benefits" (SFAS 112) as of January 1, 1994. SFAS
112  establishes  accounting  standards for  employers  who provide  benefits to
former or inactive  employees  after  employment  but before  retirement.  Those
benefits include, among others, disability, severance and workers' compensation.
The Company recorded a charge of $12.2 million ($10.0 million net of tax) in the
1994  first  quarter  as a result of the  cumulative  effect  on prior  years of
adoption of the change in accounting method.

      The  Company  and its  subsidiaries  were  reorganized  into a new holding
company  structure on July 26, 1994.  The  transactions  were accounted for as a
reorganization of entities under common control. On the merger date, WHX had the
same  consolidated  net  worth  as  WPC  and  its  subsidiaries   prior  to  the
reorganization.

      In 1995 the Company recorded an extraordinary  charge of $3.0 million, net
of taxes, to reflect the coal retiree medical  benefits for additional  retirees
assigned to the Company by the Social Security  Administration and the effect of
recording the liability at its net present value.

      In 1996 the Company  experienced  a work  stoppage  which began October 1,
1996 and  continued  through  August  12,  1997 at eight of its  plants in Ohio,
Pennsylvania  and West  Virginia.  No steel products were produced at or shipped
from  these  facilities  during  the  strike.   These  facilities   account  for
approximately 80% of the tons shipped by the Company on an annual basis.

      In 1997 the Company  recorded a special charge of $92.7 million related to
a new labor  agreement  which ended the  ten-month  strike.  The special  charge
included  $66.7  million for enhanced  retirement  benefits,  $15.5  million for
signing and retention  bonuses,  $3.8 million for special  assistance  and other
employee  benefits  payments and $6.7  million for a grant of 1.0 million  stock
options to WPN Corp.

      In 1997  the  Company  also  recorded  an  extraordinary  charge  of $26.0
million, net of tax, related to premium and interest charges required to defease
its 9 3/8%  Senior  Unsecured  Notes of $24.3  million  and coal  miner  retiree
medical benefits of $1.7 million.


                                      -15-
<PAGE>
ITEM 7.     MANAGEMENT'S DISCUSSION AND ANALYSIS
            OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

RESULTS OF OPERATIONS

OVERVIEW

            The  Company  was  reorganized  on  January  3, 1991 with a business
strategy of shifting its product mix to value-added  products through downstream
expansion and  acquisitions.  In July 1994, a new holding  company,  WHX,  which
separated the steel related  operations from non-steel related  businesses,  was
created.  The Company comprises primarily all of the steel related operations of
WHX.  The  reader  is  referred  to the WHX Form  10-K for  further  information
regarding its parent-company's operations.

            In  August  1997,  the  Company  and  the  USWA  entered  into a new
five-year labor agreement which settled a ten-month strike.  The strike directly
affected  facilities  accounting for  approximately  80% of the Company's  steel
shipments.  The new labor agreement  provides for a restructuring  of work rules
and staffing requirements and a reduction in the expense associated with retiree
healthcare  costs.  The improved work rules allowed the Company to eliminate 850
hourly jobs  (approximately 20% of the work force).  Partially  offsetting these
savings are hourly wage  increases  and the costs of a defined  benefit  pension
plan, which included a retirement incentive.

            The strike  materially  affected the  financial  performance  of the
Company  in the  fourth  quarter  of 1996 and for all of  1997,  and will be the
primary  reason  for  differences  in  year to year  comparisons.  All of  WPC's
production  facilities  resumed  operations as of September 30, 1997.  Raw steel
production  achieved 90% of capacity in the fourth  quarter of 1997. By June 30,
1998, the Company was producing at its pre-strike production levels and shipping
at its historical mix of products.

            Effective  May 31, 1998,  WHX merged WPC's defined  benefit  pension
plan with those of its  wholly  owned  Handy & Harman  ("H&H")  subsidiary.  The
pension   obligations  will  be  accounted  for  by  the  parent  company  as  a
multi-employer  plan.  The merger will  eliminate  WPC cash funding  obligations
estimated  in excess of $135.0  million  over the next four  years.  WPC pension
expense will be allocated and charged quarterly, and will offset the net prepaid
pension asset recorded by the common parent.  Pension  expense  allocated to the
Company under this plan in 1998 totaled $9.8 million.

1998 COMPARED TO 1997

            Net sales for 1998  totaled $1.1 billion on shipments of 2.2 million
tons of steel  products,  compared  to  $489.7  million  on  shipments  of 850.5
thousand  tons in 1997.  The  increase  in sales and tons  shipped is  primarily
attributable  to the work  stoppage  at eight  plants  during  the 1997  period.
Production  and shipment of steel  products at these plants closed on October 1,
1996 and the work  stoppage  continued to August 12, 1997.  Average sales prices
decreased  from $576 per ton shipped to $496 per ton shipped  primarily due to a
shift to a lower valued mix of products and a decrease of 2.7% in steel  prices,
reflecting  severe pressure on steel prices due to the  significant  increase in
low-priced steel imports.

            Cost of goods sold  decreased  from $689 per ton  shipped in 1997 to
$424 in 1998.  The 1998 costs reflect  lower pension  expense due to the merged,
fully  funded  pension  plans,  while the 1997 costs  reflect the effect of high
fixed cost and low  capacity  utilization  and higher  levels of external  steel
purchases due to the work stoppage.  The operating  rates for 1998 and 1997 were
101.9% and 27.6%, respectively. Raw steel production was 100% continuous cast.

            Depreciation  expense  increased  65%  to  $76.3  million  in  1998,
compared to 1997, due to higher levels of raw steel production and its effect on
units of production  depreciation  methods.  Raw steel  production  increased by
269%.

                                      -16-
<PAGE>
            Selling, administrative and general expense increased 17.8% to $61.5
million in 1998,  from $52.2 million in 1997. The increase is due to the reduced
level of operations in 1997.

            Interest  expense  increased  to $36.7  million  in 1998 from  $27.2
million in 1997. The increase is due primarily to the interest  expense incurred
during 1998 for the Term Loan  Agreement  which was entered  into in November of
1997.

            Other  income  increased  to $3.5  million in 1998 from $0.2 million
expense in 1997.  The increase is a result of higher  equity  income,  offset by
increased  securitization fees during 1998. The increase in equity income is the
result of lower equity  losses from the  Company's  investment in OCC. An equity
loss in OCC of $2.9  million in 1998  compared to an equity loss of $8.5 million
in 1997 for start-up of the OCC joint venture.  Increased securitization fees in
1998 are due to increased borrowings under the Receivables Facility.

            The tax  benefits  for 1998 and 1997 were $3.1  million  and  $110.0
million,  respectively,  before recording a tax benefit related to extraordinary
charges in 1997.

            Loss  before  extraordinary  items  in 1998  totaled  $6.5  million,
compared to $204.5 million in 1997.

            The 1997 extraordinary charge of $40.0 million ($26.0 million net of
tax) reflects the premium and interest of $37.4 million on the legal  defeasance
of long term debt,  and $2.6  million  for coal miner  retiree  medical  expense
attributable  to the  allocation  of  additional  retirees to the Company by the
Social Security Administration (SSA).

            Net loss  totaled  $6.5  million in 1998,  compared to a net loss of
$230.5 million in 1997.

1997 COMPARED TO 1996

            Net sales for 1997  totaled  $489.7  million on  shipments  of 850.5
thousand  tons of steel  products,  compared to $1.1 billion on shipments of 2.1
million  tons in 1996.  The  decrease  in sales and tons  shipped  is  primarily
attributable to the work stoppage at eight plants located in Ohio,  Pennsylvania
and West  Virginia.  Production  and shipment of steel  products at these plants
closed on October 1, 1996 and the work  stoppage  continued  to August 12, 1997.
Average  net sales per ton  increased  to $576 per ton shipped in 1997 from $528
per ton shipped in 1996  because  higher  value-added  products  continued to be
shipped during the strike from other locations.

            Cost of goods sold  increased  from $469 per ton  shipped in 1996 to
$689 in 1997.  This  increase  reflects  the  effect of high  fixed cost and low
capacity  utilization  and higher levels of external steel  purchases due to the
work  stoppage,  higher costs for natural gas and a higher  value-added  product
mix. In addition, costs were adversely affected by a door rehabilitation program
at the Company's  number 8 battery.  The operating rate for 1997 was 27.6%.  The
operating  rate for the nine  months  prior to the work  stoppage  in October of
1996,  was  98.9%,  but  dropped  to 74.0% for the full year of 1996.  Raw steel
production was 100% continuous cast.

            Depreciation  expense  decreased  30.1%  to $46.2  million  in 1997,
compared to 1996, due to lower levels of raw steel  production and its effect on
units of production  depreciation  methods.  Raw steel  production  decreased by
62.8%.

            Selling,  administrative and general expense decreased 4.9% to $52.2
million in 1997,  from $54.9 million in 1996. The decrease is due to the reduced
level of operations.

            Interest  expense  increased  to $27.2  million  in 1997 from  $23.8
million in 1996.  The increase is due  primarily to higher  levels of borrowings
under the Revolving Credit Facility.

            Other income  decreased  to $0.2  million  expense in 1997 from $9.5
million in 1996.  The decrease is 
                                      -17-
<PAGE>
due  primarily  to equity  losses of $8.5  million for start-up of the OCC joint
venture.  In 1997 OCC had a net loss of $14.3 million primarily  attributable to
start-up costs. In 1996, WCC recorded a $0.9 million gain on the sale of assets.

            The tax  benefits  for 1997 and 1996 were  $110.0  million  and $7.5
million,  respectively,  before recording a tax benefit related to extraordinary
charges in 1997.

            Loss before  extraordinary  items in 1997  totaled  $204.5  million,
compared to $5.3 million in 1996.

            The 1997 extraordinary charge of $40.0 million ($26.0 million net of
tax) reflects the premium and interest of $37.4 million on the legal  defeasance
of long term debt,  and $2.6  million  for coal miner  retiree  medical  expense
attributable  to the  allocation  of  additional  retirees to the Company by the
Social Security Administration (SSA).

            Net loss totaled $230.5  million in 1997,  compared to a net loss of
$5.3 million in 1996.


LIQUIDITY AND CAPITAL RESOURCES

            Net cash flow  provided by  operating  activities  for 1998  totaled
$72.8 million reflecting income of $66.7 million before  depreciation and taxes.
Working  capital  accounts  (excluding  cash,  short term borrowings and current
maturities of long-term debt) used $5.2 million of funds, principally due to the
prolonged  work  stoppage and related  start-up  cost  resulting  from its labor
settlement  on August 12,  1997.  Accounts  receivable  decreased  $5.1  million
(excluding  $26  million  sale of trade  receivables  under  the  securitization
agreement) due to decreased sales reflecting a reduction in pricing. Inventories
valued principally by the LIFO method for financial reporting purposes,  totaled
$259.3  million at December 31, 1998, an increase of $3.5 million from the prior
year end. Trade payables and accruals decreased $25.5 million due to a return to
normal payment terms  subsequent to the strike.  Net cash flow used in investing
activities  for 1998 totaled $28.0 million  including  capital  expenditures  of
$33.6 million.  Net cash flow used in financing activities totaled $38.1 million
including repayments under the Revolving Credit Facility of $22.8 million and an
increase in net intercompany receivables of $16.7 million. At December 31, 1998,
total liquidity, comprising cash, cash equivalents and funds available under our
Revolving  Credit  Facility and  Receivables  Facility,  totaled  $54.4  million
compared with $84.2  million at December 31, 1997.  At December 31, 1998,  funds
available under our Revolving  Credit Facility and Receivables  Facility totaled
$47.7 million.

            For the year ended  December  31,  1998,  the  Company  spent  $33.6
million (including capitalized interest) on capital improvements, including $9.5
million on environmental control projects.  Capital expenditures were lower than
in recent  years due to the work  stoppage.  Non-current  accrued  environmental
accruals  totaled  $10.6  million  at  December  31,  1997 and $12.7  million at
December 31, 1998.  These accruals were  initially  determined by the Company in
January 1991,  based on all available  information.  As new information  becomes
available,  including  information  provided by third parties, and changing laws
and regulations,  the accruals are reviewed and adjusted  quarterly.  Based upon
information   currently   available,   including  the  Company's  prior  capital
expenditures,  anticipated capital  expenditures,  consent agreements negotiated
with  Federal and state  agencies  and  information  available to the Company on
pending judicial and administrative proceedings, the Company does not expect its
environmental  compliance  and  liability  costs,  including  the  incurrence of
additional  fines  and  penalties,  if any,  relating  to the  operation  of its
facilities,  to have a material  adverse  effect on the  financial  condition or
results of operations of the Company. However, as further information comes into
the Company's possession, it will continue to reassess such evaluations.

            Net cash flow used in operating  activities  for 1997 totaled $175.5
million. Working capital accounts (excluding cash, short term investments, short
term borrowings and current  maturities of long-term debt) used $24.1 million of
funds, principally due to the prolonged work stoppage and related start-up costs
resulting  from its labor  settlement  on August 12, 1997.  Accounts  receivable
increased $19.8 million  (excluding $24 million sale of trade  receivables under
the  securitization  agreement) due to increased sales reflecting  resolution 


                                      -18-
<PAGE>
of the labor  dispute.  Inventories  valued  principally  by the LIFO method for
financial  reporting  purposes,  totaled $255.9 million at December 31, 1997, an
increase of $62.5 million from the prior year end.  Trade  payables and accruals
increased $69.8 million due to the strike.

            For the year ended  December  31,  1997,  the  Company  spent  $33.8
million  (including  capitalized  interest) on capital  improvements,  including
$12.4 million on environmental control projects. Capital expenditures were lower
than  in  prior  years  due to the  strike.  Non-current  accrued  environmental
liabilities  totaled  $7.8  million at December  31,  1996 and $10.6  million at
December 31, 1997.

            Continuous and substantial capital and maintenance expenditures will
be required to maintain and, where necessary,  upgrade  operating  facilities to
remain competitive, and to comply with environmental control requirements. It is
anticipated   that   necessary   capital   expenditures,    including   required
environmental  expenditures,  in  future  years  will  approximate  depreciation
expense and represent a material use of operating funds. The Company anticipates
funding  its  capital  expenditures  in 1999  from  cash on  hand,  the  sale of
receivables  under the Receivables  Facility,  availability  under the Revolving
Credit Facility, and funds generated from operations.

            The  Company  has  a   commitment   to  fund  the  working   capital
requirements of each of OCC and  Wheeling-Nisshin in proportion to its ownership
interest  if  cash  requirements  of  such  joint  ventures  are  in  excess  of
internally-generated  and available borrowed funds. The Company anticipates that
Wheeling-Nisshin  will not have such  funding  requirements  in the  foreseeable
future.  As of December  31, 1998,  the  Company's  investment  in OCC was $17.9
million.  The Company does not anticipate that additional  funding  requirements
will be needed in 1999.  OCC may require future  working  capital  contributions
from its equity  partners;  however,  the Company does not believe that any such
required funding will be material to the Company's liquidity.

            In 1994, a special purpose  wholly-owned  subsidiary of WPSC entered
into an agreement to sell (up to $75 million on a revolving  basis) an undivided
percentage  ownership in a designated pool of accounts  receivable  generated by
WPSC and two of the Company's Subsidiaries, Wheeling Construction Products, Inc.
("WCPI") and Pittsburgh Canfield Company ("PCC") (the Receivables Facility). The
Receivables  Facility  expires in August  1999.  In July 1995 WPSC  amended such
agreement to sell an additional $20 million on similar terms and conditions.  In
October 1995 WPSC entered into an agreement to include the receivables generated
by Unimast Incorporated  ("Unimast"),  a wholly-owned  subsidiary of WHX, in the
pool of accounts  receivable  sold.  Accounts  receivable  at December 31, 1998,
exclude $95.0 million  representing  uncollected  accounts  receivable sold with
recourse  limited to the  extent of  uncollectible  balances.  Fees paid by WPSC
under the  Receivables  Facility were based upon variable  rates that range from
5.5438%  to  8.50%.  Based on the  Company's  collection  history,  the  Company
believes that credit risk associated with the above arrangement is immaterial.

            WPSC has a Revolving Credit Facility ("RCF") with Citibank,  N.A. as
agent,  which is guaranteed by WPC and two subsidiaries of the Company.  The RCF
provides for borrowings for general corporate  purposes up to $150 million and a
$35  million  sub-limit  for  Letters of Credit.  The RCF  expires  May 3, 1999.
Interest  rates  are  based  on the  Citibank  prime  rate  plus  1.0%  and/or a
Eurodollar  rate  plus  2.25%,  but the  margin  over  the  prime  rate  and the
Eurodollar rate can fluctuate based upon performance. A commitment fee of .5% is
charged  on the  unused  portion.  The letter of credit fee is 2.25% and is also
performance  based.  Borrowings  are secured  primarily  by 100% of the eligible
inventory of WPSC, PCC and WCPI,  subsidiaries of the Company,  and the terms of
the RCF contain  various  restrictive  covenants,  limiting  among other things,
dividend  payments  or other  distribution  of  assets,  as  defined in the RCF.
Certain  financial  covenants  associated  with  leverage,  net  worth,  capital
spending, cash flow and interest coverage must be maintained.  The Company, PCC,
and WCPI have each  guaranteed  all of the  obligations  of WPSC  under the RCF.
Borrowings  outstanding  against the RCF at  December  31,  1998  totaled  $67.0
million.  Letters  of credit  outstanding  under the RCF were  $8.6  million  at
December 31, 1998.

            WPSC also has a separate facility with Citibank, N.A. for letters of
credit up to $50 million.  At 

                                      -19-
<PAGE>
December 31, 1998 letters of credit totaling $7.7 million were outstanding under
this  facility.  The  letters  of credit  are  collateralized  at 105% with U.S.
Government securities owned by the Company, and are subject to an administrative
charge of .4% per annum on the amount of outstanding letters of credit.

            Unimast  is a  participant  in the  Receivables  Facility,  and  its
receivables are included in the pool of receivables sold.  Unimast,  WHX and the
Company  entered into an  intercreditor  agreement upon the  consummation of the
November  offering of 9 1/4% Senior Notes which  provides,  among other  things,
that Unimast and WHX will be solely  responsible if the Receivables  Facility is
terminated as a result of a breach of such agreement by Unimast. The Company has
agreed to indemnify WHX and Unimast if the Receivables Facility is terminated as
a  result  of a  breach  of  such  agreement  by the  Company.  There  can be no
assurance,  however,  that in the event of a default  by  Unimast  or WHX,  that
either Unimast or WHX will be able to make any payments to the Company  required
by such intercreditor agreement.

            The Company is currently negotiating  replacement facilities for the
Receivables Facility and the RCF.

            In November 1997 WPSC issued $275.0  million  principal  amount of 9
1/4% Senior  Notes.  In April 1998 the Company  filed a  registration  statement
relating to an exchange offer for the Notes under the Securities Act of 1933.

            In November  1997 the Company  entered into the Term Loan  Agreement
with DLJ Capital  Funding,  Inc.,  as  syndication  agent  pursuant to which the
Company borrowed $75.0 million.  Interest on the Term Loan is payable  quarterly
on March 15, June 15,  September 15 and  December 15 as to Base rate loans,  and
with respect to LIBOR loans on the last day of each applicable  interest period,
and if such interest period shall exceed 3 months at intervals of 3 months after
the first day of such interest period.  Amounts  outstanding under the Term Loan
Agreement bear interest at the Base rate (as defined  therein) plus 2.25% or the
LIBOR rate (as defined therein) plus 3.25%. The Company's  obligations under the
Term  Loan  Agreement  are  guaranteed  by  its  present  and  future  operating
subsidiaries.  The  Company  may  prepay  the  obligations  under  the Term Loan
Agreement  beginning on November  15, 1998,  subject to a premium of 2.0% of the
principal  amount  thereof.  Such premium  declines to 1.0% on November 15, 1999
with no premium on or after November 15, 2000.

            The  proceeds  from the 9 1/4% Senior  Unsecured  Notes and the Term
Loan  Agreement  were used to defease  $266.2  million of 9 3/8% Senior  Secured
Notes  and to pay  down  borrowings  under  the RCF.  The  Company  recorded  an
extraordinary  charge of $40.0 million  ($26.0  million net of tax) to cover the
premium and interest of $37.4 million on the legal defeasance of long term debt.

            Under the terms of the new labor agreement,  the Company established
a defined benefit pension plan for USWA - represented  employees and recorded an
unfunded  accumulated pension benefit obligation for the defined benefit plan of
approximately  $167.3  million,  of which  approximately  75% was required to be
funded over the next five  years.  In  accordance  with ERISA  regulations,  the
Company was not required to and did not make  significant  contributions to fund
the  obligations  of the new plan in 1998.  Effective  May 31, 1998,  WHX merged
WPC's defined benefit pension plan with those of its wholly owned Handy & Harman
("H&H") subsidiary.  The pension obligations will be accounted for by the parent
company as a multi-employer plan. As a result of the merger of the pension plans
and based on current actuarial  assumptions,  on a consolidated  basis, WHX will
report a net prepaid  pension asset of $44.5 million.  The merger will eliminate
WPC cash funding obligations estimated in excess of $135.0 million over the next
four years.  The pension  liability  on the WPC books at the time of the pension
merger,  net  of  the  deferred  tax  asset,  was  eliminated  and  credited  to
paid-in-capital.  WPC pension  expense will be allocated and charged  quarterly,
and will offset the net prepaid  pension asset  recorded by the parent  company.
Pension expense allocated to WPC under this plan in 1998 totaled $9.8 million.

            WPC's company wide Year 2000 Project is proceeding on schedule.  The
project addresses all aspects of computing at WPC including  mainframe  systems,
external  data  interfaces  to  customers,   suppliers,  banks  and  government,
mainframe  controlling software,  voice and data systems,  internal networks and


                                      -20-
<PAGE>
personal  computers,  plant process control systems,  building controls,  and in
addition  surveying  WPSC's  major  suppliers  and  customers  to  assure  their
readiness.

            Mainframe  business systems were 97% Year 2000 compliant at December
31, 1998 and  expected to be 100%  compliant by March 31,  1999;  external  data
interfaces, mainframe software, voice and data systems and internal networks and
personal  computers are anticipated to be Year 2000 compliant by March 31, 1999;
process  control  systems are  anticipated  to be  compliant  by June 30,  1999.
Building  controls are Year 2000  compliant at this time.  Supplier and customer
survey's  are 50%  complete  at this time and  completion  is  expected  by June
30,1999.

            The total costs associated with the required modifications to become
Year 2000  compliant is not expected to be material to the  Company's  financial
condition or results of  operations.  The estimated  total cost of the Year 2000
Project is $2.0  million.  The total  amount  expended  on the  project  through
December 31, 1998 is approximately $1.7 million. Funds are being provided to the
project  through  departmental  expenses  budgeted for at the  beginning of this
project.

            Failure  to  correct  a  Year  2000  problem   could  result  in  an
interruption of certain normal business activities or operations.  The Year 2000
project  is  expected  to  eliminate   any  issues  that  would  cause  such  an
interruption.  WPSC  believes that the  implementation  of the Year 2000 project
changes  will  minimize any  interruptions.  WPSC is currently in the process of
developing  contingency  plans  regarding  component  failure  of any Year  2000
non-compliant segment of the business.

            Short-term  liquidity is dependent,  in large part, on cash on hand,
investments,   availability  under  the  Revolving  Credit  Facility,   sale  of
receivables  under the Receivables  Facility,  general  economic  conditions and
their effect on steel demand and prices.  Long-term  liquidity is dependent upon
the Company's ability to sustain profitable  operations and control costs during
periods of low demand or pricing  in order to sustain  positive  cash flow.  The
Company  satisfies  its  working  capital  requirements  through  cash on  hand,
investments,  the Receivables Facility, borrowing availability under the RCF and
funds generated from  operations.  The Company  believes that,  based on current
levels of operations and  anticipated  improvements in operating  results,  cash
flows from  operations  and borrowings  available  under the RCF will enable the
Company to fund its  liquidity  and  capital  expenditure  requirements  for the
foreseeable  future,  including  scheduled payments of interest on the Notes and
payments  of  interest  and  principal  on  the  Company's  other  indebtedness,
including borrowings under the Term Loan Agreement.  However,  external factors,
such as worldwide steel production and demand and currency  exchange rates could
materially affect the Company's  results of operations and financial  condition.
There  can be no  assurance  that  the  Company  will be able  to  maintain  its
short-term and/or its long-term liquidity.  A failure by the Company to maintain
its liquidity could have a material adverse effect on the Company.

            When used in the  Management's  Discussion  and Analysis,  the words
"anticipate",  "estimate"  and  similar  expressions  are  intended  to identify
forward-looking statements.  Within the meaning of Section 27A of the Securities
Act and Section 21E of the Exchange Act, which are intended to be covered by the
safe harbors created thereby.  Investors are cautioned that all  forward-looking
statements  involve risks and uncertainty,  including  without  limitation,  the
ability of the Company to develop  market and sell its products,  the effects of
competition and pricing and Company and industry  shipment levels.  Although the
Company believes that the assumptions underlying the forward-looking  statements
are reasonable, any of the assumptions could be inaccurate, and therefore, there
can be no assurance that the  forward-looking  statements  included  herein will
prove to be accurate.


QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS

COMMODITY PRICE RISK AND RELATED RISKS

            In the normal  course of  business,  the Company is exposed to price
fluctuations related to the 


                                      -21-
<PAGE>
purchase of natural gas, steel  products,  coal,  coke,  electricity and certain
nonferrous metals used as raw materials.  The Company's market risk strategy has
generally  been to obtain  competitive  prices for its products and services and
allow operating results to reflect market price movements dictated by supply and
demand.


INTEREST RATE RISK

            The Company is subject to the effects of interest rate  fluctuations
on certain of its financial instruments. A sensitivity analysis of the projected
incremental  effect of a hypothetical 10% change in 1998 year-end interest rates
on the fair value of WPC's  financial  instruments  is provided in the following
table:
<TABLE>
<CAPTION>
                                                              Carrying         Market               Incremental(1)
                                                                Value           Value               Incr./(decr.)
                                                                -----           -----               -------------
                                                                          (Dollars in Thousands)
<S>                                                             <C>            <C>                     <C>    
               Financial liabilities:
               Fixed-rate long-term debt (including
                amounts due within one year)                    $274,071       $255,750                $15,345
</TABLE>
(1)  Reflects a 10% decrease in interest rates for financial liabilities.

            Fair  value of cash and cash  equivalents,  receivables,  short-term
borrowings,  accounts payable,  and accrued interest and variable rate long-term
debt approximate their carrying values and are relatively insensitive to changes
in  interest  rates due to the  short-term  maturity of the  instruments  or the
variable nature of the underlying interest rates. Accordingly,  these items have
been excluded from the above table.

            The Company attempts to maintain a reasonable balance between fixed-
and floating-rate debt in an attempt to keep financing costs as low as possible.
At December 31, 1998, a majority of the  Company's  portfolio of long-term  debt
consisted  of  fixed-rate  instruments.  Accordingly,  the  fair  value  of such
instruments   may  be   relatively   sensitive  to  effects  of  interest   rate
fluctuations.  In addition,  the fair value of such instruments is also affected
by investors'  assessments of the risks  associated with industries in which the
Company operates as well as the Company's overall  creditworthiness  and ability
to  satisfy  such  obligations  upon  their  maturity.  However,  the  Company's
sensitivity  to interest  rate declines and other market risks that might result
in a  corresponding  increase in the fair value of its fixed-rate debt portfolio
would only have an unfavorable effect on the Company's results of operations and
cash flows to the extent that the Company elected to repurchase or retire all of
a  portion  of its  fixed-rate  debt  portfolio  at an  amount  in excess of the
corresponding carrying value.

            See Note H to the consolidated  financial  statements for additional
information concerning the Company's long-term debt arrangements.

SAFE HARBOR

            The Company's quantitative and qualitative  disclosures about market
risk include  forward-looking  statements with respect to  management's  opinion
about the risks  associated  with the  Company's  financial  instruments.  These
statements  are based on certain  assumptions  with  respect  to market  prices,
interest  rates and other  industry-specific  risk factors.  To the extent these
assumptions  prove to be inaccurate,  future outcomes may differ materially from
those discussed above.

NEW ACCOUNTING STANDARDS

            The Company adopted Statement of Financial  Accounting Standards No.
130, "Reporting Comprehensive Income" (SFAS No. 130), effective January 1, 1998.
This Statement  establishes standards for reporting and display of comprehensive
income and its components in the financial statements. 


                                      -22-
<PAGE>
The  Company  does not have any items of  comprehensive  income  other  than net
income.

            In  March  1998,   the  American   Institute  of  Certified   Public
Accountants  issued  Statement of Position  98-1,  "Accounting  for the Costs of
Computer  Software  Developed or Obtained for Internal Use" (SOP 98-1). SOP 98-1
addresses costs incurred in connection with the  implementation  of internal-use
software,  and  specifies  the  circumstances  under which such costs  should be
capitalized  or expensed.  The Company will be required to adopt SOP 98-1 in the
first quarter of 1999. At this time, management does not anticipate the adoption
of SOP 98-1 will have a material  impact on the Company's  results of operations
or financial position.

            In June  1998,  the  Financial  Accounting  Standards  Board  issued
Statement of Financial  Accounting Standards No. 133, "Accounting for Derivative
Instruments and Hedging Activities" (SFAS 133). This pronouncement  requires all
derivative  instruments  to be  reported  at fair  value on the  balance  sheet;
depending on the nature of the derivative instrument, changes in fair value will
be  recognized  either in net income or as an element of  comprehensive  income.
SFAS 133 is  effective  for fiscal  years  beginning  after June 15,  1999.  The
Company has not  engaged in  significant  activity  with  respect to  derivative
instruments or hedging activities in the past. Management of the Company has not
yet determined the impact,  if any, of the adoption of SFAS 133 on the Company's
financial position or results of operations.





                                      -23-
<PAGE>
                        REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors and
Stockholders of Wheeling-Pittsburgh Corporation (a wholly-owned subsidiary of 
  WHX Corporation)

            In our opinion, the accompanying consolidated balance sheets and the
related consolidated statements of operations, and of cash flows present fairly,
in  all  material  respects,   the  financial  position  of  Wheeling-Pittsburgh
Corporation  and its  subsidiaries  (the Company) at December 31, 1998 and 1997,
and the results of their  operations  and their cash flows for each of the three
years in the period ended  December  31,  1998,  in  conformity  with  generally
accepted   accounting   principles.   These   financial   statements   are   the
responsibility of the Company's management;  our responsibility is to express an
opinion on these  financial  statements  based on our audits.  We conducted  our
audits of these  statements  in  accordance  with  generally  accepted  auditing
standards which require that we plan and perform the audit to obtain  reasonable
assurance   about  whether  the  financial   statements  are  free  of  material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the  amounts  and  disclosures  in  the  financial  statements,   assessing  the
accounting  principles  used and significant  estimates made by management,  and
evaluating the overall  financial  statement  presentation.  We believe that our
audits provide a reasonable basis for the opinion expressed above.







PricewaterhouseCoopers LLP
Pittsburgh, Pennsylvania
February 18, 1999


                                      -24-
<PAGE>
ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

                         WHEELING-PITTSBURGH CORPORATION
                 (A WHOLLY-OWNED SUBSIDIARY OF WHX CORPORATION)

                      CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>

                                                                              Year Ended December 31,
                                                              1996                    1997                 1998
                                                              ----                    ----                 ----
                                                                              (Dollars in thousands)

REVENUES:
<S>                                                        <C>                   <C>                   <C>        
Net sales ...........................................      $ 1,110,684           $   489,662           $ 1,111,541
COST AND EXPENSES:

Cost of products sold, excluding
  depreciation ......................................          988,161               585,609               950,080
Depreciation ........................................           66,125                46,203                76,321
Selling, administrative and general expense .........           54,903                52,222                61,523
Special charge ......................................             --                  92,701                  --
                                                           -----------           -----------           ----------- 
                                                             1,109,189               776,735             1,087,924
                                                           -----------           -----------           ----------- 
Operating income (loss) .............................            1,495              (287,073)               23,617
Interest expense on debt ............................           23,763                27,204                36,699
Other income (expense) ..............................            9,476                  (221)                3,478
                                                           -----------           -----------           ----------- 
Loss before taxes
  and extraordinary item ............................          (12,792)             (314,498)               (9,604)
Tax provision (benefit) .............................           (7,509)             (110,035)               (3,101)
                                                           -----------           -----------           ----------- 
Loss before
  extraordinary item ................................           (5,283)             (204,463)               (6,503)
Extraordinary charge--net of tax ....................             --                 (25,990)                 --
                                                           -----------           -----------           ----------- 
Net loss ............................................      $    (5,283)          $  (230,453)          $    (6,503)
                                                           ===========           ===========           =========== 
</TABLE>
See Notes to Consolidated Financial Statements

                                      -25-
<PAGE>
                         WHEELING-PITTSBURGH CORPORATION
                 (A WHOLLY-OWNED SUBSIDIARY OF WHX CORPORATION)

                           CONSOLIDATED BALANCE SHEET

<TABLE>
<CAPTION>
                                                                                                                  December 31,
                                                                                                              1997           1998
                                                                                                              ----           ----
                                                                                                           (Dollars in thousands)
                                                                           ASSETS
<S>                                                                                                      <C>            <C>
Current assets:
  Cash and cash equivalents ..........................................................................   $         0    $     6,731
  Trade receivables, less allowances for doubtful
    accounts of $1,108 and $1,095 ....................................................................        44,569         39,504
  Inventories ........................................................................................       255,857        259,339
  Prepaid expenses and deferred charges ..............................................................        24,938          6,141
                                                                                                         -----------    -----------
        Total current assets .........................................................................       325,364        311,715
Investment in associated companies ...................................................................        68,742         69,075
Property, plant and equipment, at cost less
  accumulated depreciation ...........................................................................       694,108        651,086
Deferred income taxes ................................................................................       196,966        147,162
Intangible asset-pension .............................................................................        76,714           --
Due from affiliates ..................................................................................        27,955         44,693
Deferred charges and other assets ....................................................................        34,719         32,636
                                                                                                         -----------    -----------
                                                                                                         $ 1,424,568    $ 1,256,367
                                                                                                         ===========    ===========


                                                            LIABILITIES AND STOCKHOLDER'S EQUITY

Current liabilities:
  Trade payables .....................................................................................   $   116,559    $    96,615
  Short term debt ....................................................................................        89,800         66,999
  Payroll and employee benefits ......................................................................        56,212         58,522
  Federal, state and local taxes .....................................................................        11,875          8,488
  Deferred income taxes--current .....................................................................        32,196         27,156
  Interest and other .................................................................................         9,354          9,882
  Long-term debt due in one year .....................................................................           199            217
                                                                                                         -----------    -----------
        Total current liabilities ....................................................................       316,195        267,879
Long-term debt .......................................................................................       349,904        349,775
Other employee benefit liabilities ...................................................................       427,125        414,955
Pension liability ....................................................................................       166,652           --
Other liabilities ....................................................................................        49,980         52,476
                                                                                                         -----------    -----------
                                                                                                           1,309,856      1,085,085
                                                                                                         -----------    -----------
STOCKHOLDER'S EQUITY:

Common stock - $.01 Par value; 100 shares
     issued and outstanding ..........................................................................          --             --
Additional paid-in capital ...........................................................................       272,065        335,138
Accumulated deficit ..................................................................................      (157,353)      (163,856)
                                                                                                         -----------    -----------
                                                                                                             114,712        171,282
                                                                                                         -----------    -----------
                                                                                                         $ 1,424,568    $ 1,256,367
                                                                                                         ===========    ===========
</TABLE>

                 SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                      -26-
<PAGE>
                         WHEELING-PITTSBURGH CORPORATION
                 (A WHOLLY-OWNED SUBSIDIARY OF WHX CORPORATION)

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                                          Year ended December 31,
                                                                         ---------------------------------------------------
                                                                              1996              1997*                1998
                                                                              ----              -----                ----
                                                                                          (Dollars in thousands)
<S>                                                                        <C>                <C>                <C>       
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss .........................................................         $  (5,283)         $(230,453)         $  (6,503)
Items not affecting cash from operating activities:
  Depreciation ...................................................            66,125             46,203             76,321
  Other postretirement benefits ..................................             3,505              2,322             (8,174)
  Coal retirees' medical benefits (net of tax) ...................              --                1,700               --
  Premium on early debt retirement (net of tax) ..................              --               24,290               --
  Income taxes ...................................................            (6,572)          (110,495)            (3,594)
  Special charges (net of current portion) .......................              --               69,137               --
  Pension expense ................................................              --                9,327              9,773
  Equity (income) loss in affiliated companies ...................            (9,495)             1,206             (5,333)
Decrease (increase) in working capital elements:
  Trade receivables ..............................................            50,061            (43,780)           (20,935)
  Trade receivables sold .........................................           (22,000)            24,000             26,000
  Inventories ....................................................            73,247            (62,528)            (3,482)
  Trade payables .................................................           (48,721)            65,059            (19,944)
  Other current assets ...........................................             4,033            (11,572)            18,797
  Other current liabilities ......................................           (13,973)             4,744             (5,589)
Other items--net .................................................             1,355             35,334             15,512
                                                                           ---------          ---------          --------- 
Net cash flow provided by (used in) operating activities .........            92,282           (175,506)            72,849
                                                                           ---------          ---------          --------- 

CASH FLOWS FROM INVESTING ACTIVITIES:
  Plant additions and improvements ...............................           (31,188)           (33,755)           (33,595)
  Investments in affiliates ......................................           (17,240)            (7,150)              --
  Proceeds from sales of assets ..................................             1,425              1,217                607
  Dividends from affiliated companies ............................             2,500              2,500              5,000
                                                                           ---------          ---------          --------- 
Net cash used in investing activities ............................           (44,503)           (37,188)           (27,988)
                                                                           ---------          ---------          --------- 

CASH FLOWS FROM FINANCING ACTIVITIES:
  Long-term debt proceeds, net of issuance cost ..................              --              340,270               --
  Long-term debt retirement ......................................           (15,153)          (268,277)              (111)
  Premium on early debt retirement ...............................              --              (32,600)              --
  Short term debt borrowings (payments) ..........................              --               89,800            (22,801)
  Letter of credit collateralization .............................               384             16,984              1,520
  Receivables from affiliates ....................................           (39,886)            30,567            (16,738)
                                                                           ---------          ---------          --------- 
Net cash (used in) provided by financing activities ..............           (54,655)           176,744            (38,130)
                                                                           ---------          ---------          --------- 

(DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS .................            (6,876)           (35,950)             6,731
Cash and cash equivalents at beginning of year ...................            42,826             35,950               --
                                                                           ---------          ---------          --------- 
Cash and cash equivalents at end of year .........................         $  35,950          $    --            $   6,731
                                                                           =========          =========          ========= 
</TABLE>

* RECLASSIFIED

                 SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                      -27-
<PAGE>
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

ACCOUNTING POLICIES

            The  accounting  policies  presented  below  have been  followed  in
preparing the accompanying consolidated financial statements.

            The preparation of financial statements in conformity with generally
accepted  accounting  principles  requires  management  to  make  estimates  and
assumptions  that  affect the  reported  amounts of assets and  liabilities  and
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements  and the  reported  amounts  of  revenues  and  expenses  during  the
reporting period. Actual results could differ from those estimates.

PRINCIPLES OF CONSOLIDATION

            The consolidated  financial  statements  include the accounts of all
subsidiary companies. All significant intercompany accounts and transactions are
eliminated  in  consolidation.  The Company uses the equity method of accounting
for investments in unconsolidated companies owned 20% or more.

EARNINGS PER SHARE

            Presentation  of  earnings  per  share is not  meaningful  since the
Company is a wholly owned subsidiary of WHX Corporation.  See Note  A--Corporate
Reorganization.

BUSINESS SEGMENT

            The Company is primarily engaged in one line of business and has one
industry segment,  which is the making,  processing and fabricating of steel and
steel products. The Company's products include hot rolled and cold rolled sheet,
and coated  products  such as  galvanized,  prepainted  and tin mill sheet.  The
Company also manufactures a variety of fabricated steel products  including roll
formed corrugated  roofing,  roof deck, form deck, floor deck,  culvert,  bridge
form  and  other  products  used  primarily  by the  construction,  highway  and
agricultural markets.

            Through an extensive mix of products,  the Company markets to a wide
range of  manufacturers,  converters  and  processors.  The Company's 10 largest
customers (including  Wheeling-Nisshin) accounted for approximately 34.9% of its
net  sales in 1996,  30.2% in 1997 and 39.7% in 1998.  Wheeling-Nisshin  was the
only  customer  to account  for more than 10% of net sales in 1996 and 1998.  No
single   customer   accounted   for  more   than  10%  of  net  sales  in  1997.
Wheeling-Nisshin  accounted  for  12.7% and 14.6% of net sales in 1996 and 1998,
respectively.  Geographically,  the  majority  of the  Company's  customers  are
located within a 350-mile  radius of the Ohio Valley.  However,  the Company has
taken advantage of its river-oriented  production facilities to market via barge
into more distant locations such as the Houston,  Texas and St. Louis,  Missouri
areas. The Company has acquired  regional  facilities to service an even broader
geographical area.

CASH AND CASH EQUIVALENTS

            Cash and cash  equivalents  include  cash on hand and on deposit and
highly liquid debt instruments with original maturities of three months or less.

INVENTORIES

            Inventories  are stated at cost which is lower than market.  Cost is
determined  by the  last-in  first-out  ("LIFO")  method for  substantially  all
inventories.  In 1998 and  1997,  approximately  87% and 91%,  respectively,  of
inventories are valued using the LIFO method.



                                      -28-
<PAGE>
PROPERTY, PLANT AND EQUIPMENT

            Depreciation is computed on the straight line and the modified units
of production methods for financial  statement purposes and accelerated  methods
for income tax purposes.  The modified  units of production  method  adjusts the
straight line method based on an activity factor for operating assets.  Adjusted
annual  depreciation  is not less than 60% nor more than 110% of  straight  line
depreciation. Accumulated depreciation after adjustment is not less than 75% nor
more than 110% of straight line  depreciation.  Interest cost is capitalized for
qualifying assets during the assets'  acquisition period.  Capitalized  interest
cost is amortized over the life of the asset.

            Maintenance  and  repairs  are  charged  to  income.   Renewals  and
betterments  made  through  replacements  are  capitalized.  Profit  or  loss on
property dispositions is credited or charged to income.

PENSIONS AND OTHER POSTRETIREMENT PLANS

            The  Company  has a  tax  qualified  defined  benefit  pension  plan
covering United  Steelworkers of America ("USWA")  represented  hourly employees
and substantially all salaried employees and tax qualified defined  contribution
pension plans covering  other hourly  employees and  substantially  all salaried
employees. The defined benefit plan provides for a defined monthly benefit based
on years of service.  The defined  contribution  plans provide for contributions
based on a percentage of compensation for salaried employees and a rate per hour
worked for hourly employees.  Costs for the defined contribution plans are being
funded currently.  Unfunded  accumulated  benefit  obligations under the defined
benefit plan are subject to annual minimum cash funding  requirements  under the
Employees Retirement Income Security Act ("ERISA").

            The  Company  sponsors  medical  and  life  insurance  programs  for
substantially all employees. Similar group medical programs extend to pensioners
and  dependents.  The  management  plan provides basic medical and major medical
benefits on a non-contributory basis through age 65.

INCOME TAXES

            The Company  accounts for income taxes in accordance  with Statement
of Financial  Accounting  Standards No. 109 (SFAS 109),  "Accounting  for Income
Taxes".  Recognition  is given in the  accounts  for the  income  tax  effect of
temporary  differences in reporting  transactions for financial and tax purposes
using the deferred liability method. Tax provisions and the related tax payments
or  refunds  have  been  reflected  in the  Company's  financial  statements  in
accordance with a tax sharing agreement between WHX and the Company.

ENVIRONMENTAL MATTERS

            The  Company  accrues  for  losses  associated  with   environmental
remediation  obligations when such losses are probable and reasonably estimable.
Accruals  for  estimated  losses  from  environmental   remediation  obligations
generally are  recognized no later than  completion of the remedial  feasibility
study.

            Such  accruals  are  adjusted  as further  information  develops  or
circumstances change. Costs of future expenditures for environmental remediation
obligations   are  not  discounted  to  their  present   value.   Recoveries  of
environmental  remediation  costs from other parties are recorded as assets when
their receipt is deemed probable.



                                      -29-
<PAGE>
NOTE A--CORPORATE REORGANIZATION

  FORMATION OF WHX CORPORATION

            On July 26, 1994 the Company and its  subsidiaries  were reorganized
and a new holding company, WHX Corporation (WHX), was formed. Upon effectiveness
of the merger each share of Wheeling-Pittsburgh  Corporation (WPC) Common Stock,
WPC Series A Preferred Stock and each WPC Warrant were converted into a share of
WHX Common Stock, WHX Series A Preferred Stock and a WHX Warrant,  respectively.
WHX also assumed the obligation to purchase the  Redeemable  Common Stock of the
ESOP and guaranteed substantially all of the Company's outstanding indebtedness.
See Note H. The  merger  was a change in legal  organization  and the assets and
liabilities  transferred  were  accounted for at historical  cost with carryover
basis. The merger was accounted for as a reorganization of entities under common
control whereby the basis of assets and liabilities were unchanged. WPC retained
the capital stock of the steel-related subsidiaries and equity investments.

            At December 31, 1997 and 1998,  amounts due from affiliates  totaled
$28.0  million and $44.7  million,  respectively.  These  amounts  reflect  cash
advances  between   affiliates,   dividends  paid  by  WPC  on  behalf  of  WHX,
intercompany tax allocations and Unimast working capital advances.


 NOTE  B -- COLLECTIVE BARGAINING AGREEMENT

            The Company's prior labor agreement with the USWA expired on October
1, 1996.  On August 1, 1997 the  Company  and the USWA  announced  that they had
reached  a  tentative  agreement  on the  terms of a new  collective  bargaining
agreement.   The  tentative  agreement  was  ratified  on  August  12,  1997  by
USWA-represented  employees,  ending  a  ten-month  strike.  The new  collective
bargaining  agreement  provided for a defined benefit pension plan, a retirement
enhancement  program,  short-term  bonuses and special  assistance  payments for
employees not  immediately  recalled to work and $1.50 in hourly wage  increases
over its term of not less than five years. It also provides for the reduction of
850 jobs,  mandatory  multicrafting  as well as  modification  of  certain  work
practices.


NOTE C -- SPECIAL CHARGE - NEW LABOR AGREEMENT

            The Company  recorded a special charge of $92.7 million in 1997. The
special  charge is  primarily  related to certain  benefits  included in its new
collective bargaining agreement.

            The special charges included enhanced retirement benefits paid under
the  defined  benefit  pension  program  which  totaled  $66.7  million and were
recorded  under the  provisions  of Statement of Financial  Accounting  Standard
No.88,  "Employers'  Accounting  For  Settlements  and  Curtailments  of Defined
Benefit  Pension Plans and for Termination  Benefits" (SFAS No.88),  and various
other charges which totaled $26.0 million.  These charges  include $15.5 million
for signing and retention bonuses,  $3.8 million for special assistance payments
to laid-off  employees and other employee benefits and $6.7 million for the fair
value of a stock option grant to WPN Corp. for its  performance in negotiating a
new labor agreement.



                                      -30-
<PAGE>
NOTE D--PENSIONS, OTHER POSTRETIREMENT AND POSTEMPLOYMENT BENEFITS

  PENSION PROGRAMS

            The Company provides defined  contribution pension programs for both
hourly and  salaried  employees,  and prior to August 12,  1997 also  provided a
defined contribution pension program for USWA-represented  employees.  These tax
qualified defined  contribution plans provide,  in the case of hourly employees,
an  increasing  Company  contribution  per hour  worked  based on the age of its
employees.  A similar tax qualified plan for salaried employees provides defined
Company  contributions based on a percentage of compensation  dependent upon age
and in  certain  cases  age and  service  of its  employees.  The  Company  also
established  a  supplemental  defined  benefit  pension  plan  for its  salaried
employees.

            On August  12,  1997,  the  Company  established  a defined  benefit
pension plan for  USWA-represented  employees pursuant to a new labor agreement.
The plan includes individual participant accounts of USWA-represented  employees
from the  hourly  defined  contribution  plan and  merges  the  assets  of those
accounts into the defined benefit plan.

            As of December  31, 1998,  $120.3  million of fully vested funds are
held in trust for benefits earned under the hourly defined  contribution pension
plans.  Approximately  80% of the trust assets are invested in equities,  18% in
fixed income investments and 2% in cash and cash equivalents.

            As of December  31,  1998,  $38.3  million of fully vested funds are
held  in  trust  for  benefits  earned  under  the  salaried  employees  defined
contribution plan.  Approximately 80% of the assets are invested in equities 18%
are in fixed income  investments and 2% in cash and cash  equivalents.  All plan
assets are invested by professional investment managers.

            All pension  provisions charged against income totaled $9.3 million,
$12.6 million and $13.4 million in 1996, 1997 and 1998,  respectively.  In 1997,
the  Company  also  recorded  a $66.7  million  charge for  enhanced  retirement
benefits paid under the defined  benefit  pension plan,  pursuant to a new labor
agreement.

DEFINED BENEFIT PLAN

            The  plan  was  established  pursuant  to  a  collective  bargaining
agreement  ratified  on August  12,  1997.  Prior to that  date,  benefits  were
provided  through a defined  contribution  plan, the  Wheeling-Pittsburgh  Steel
Corporation  ("WPSC"),  a wholly owned  subsidiary  of the  Company,  Retirement
Security Plan ("Retirement Security Plan").

            The defined benefit pension plan covers employees represented by the
USWA. The plan also includes individual participant accounts from the Retirement
Security Plan.  The assets of the Retirement  Security Plan were merged into the
Defined Benefit Pension Plan.

            Since the plan  includes the account  balances  from the  Retirement
Security Plan, the plan includes both defined  benefit and defined  contribution
features.  The gross benefit,  before offsets,  is calculated  based on years of
service and the current benefit  multiplier under the plan. This gross amount is
then offset for benefits payable from the Retirement  Security Plan and benefits
payable by the Pension Benefit Guaranty  Corporation from previously  terminated
plans.  Individual  employee accounts  established under the Retirement Security
Plan are maintained until retirement.  Upon retirement, the account balances are
converted into monthly benefits that serve as an offset to the gross benefit, as
described above. Aggregate account balances held in trust in individual employee
accounts which will be available upon  retirement to offset the gross benefit at
December 31, 1998 totaled $119.4 million.

            As part of the new five-year labor agreement,  the Company offered a
limited program of Retirement  Enhancements.  The Retirement Enhancement program
provide for unreduced retirement benefits to the first 850 employees who retired
after October 1, 1996. In addition, each retiring participant could elect a lump


                                      -31-
<PAGE>
sum payment of $25,000 or a $400 monthly  supplement  payable until age 62. More
than 850  employees  applied for  retirement  under this program by December 31,
1997.

            The Retirement  Enhancement  program  represented a Curtailment  and
Special Termination Benefits under SFAS No. 88. The Company recorded a charge of
$66.7 million in 1997 to cover the retirement enhancement program.

            In 1998 the Company established a supplemental  defined benefit plan
covering its salaried employees employed as of January 31, 1998 which provides a
guaranteed minimum benefit based on years of service and compensation. The gross
benefit  from  this  plan is  offset  by the  annuitized  value  of the  defined
contribution  plan  account  balance and any  benefits  payable from the Pension
Benefit  Guaranty  Corporation  from the previously  terminated  defined benefit
pension plan.

            Effective  May 31, 1998,  WHX merged WPC's defined  benefit  pension
plans with those of its wholly  owned  Handy & Harman  ("H&H")  subsidiary.  The
pension   obligations  will  be  accounted  for  by  the  parent  company  as  a
multi-employer  pension plan. As a result of the merger of the pension plans and
based on current actuarial assumptions, on a consolidated basis, WHX will report
a net prepaid pension asset of $44.5 million. The merger will also eliminate WPC
cash funding  obligations  estimated  in excess of $135.0  million over the next
four years.  The pension  liability  on the WPC books at the time of the pension
merger,  net  of  the  deferred  tax  asset,  was  eliminated  and  credited  to
paid-in-capital.  WPC pension  expense will be allocated and charged  quarterly,
and will offset the net prepaid  pension asset  recorded by the parent  company.
Pension expense allocated to WPC under this plan in 1998 totaled $9.8 million.


                                      -32-
<PAGE>
            The amounts (prepaid) accrued at December 31, included the following
components.
<TABLE>
<CAPTION>
                                                                                                 Postretirement Benefits
                                                                  Pension Benefits                Other Than Pensions
                                                                  ----------------                -------------------
                                                                (Dollars in Thousands)           (Dollars in Thousands)
                                                                 1997             1998             1997             1998
                                                              ---------        ---------        ---------        ---------
<S>                                                           <C>              <C>              <C>              <C>      
Change in benefit obligation:
 Benefit Obligation at beginning of year                      $    --          $ 172,431        $ 361,341        $ 308,812
 Service cost                                                     2,278            1,467            3,337            2,231
 Interest cost                                                    4,172            3,518           21,573           19,172
 Actuarial (gain)                                                  --            (10,390)         (24,792)          (3,674)
 Benefits paid                                                  (12,505)          (7,527)         (19,100)         (27,528)
 Plan Amendments -Implementation                                101,295             --            (45,277)            --
 Business Combinations                                             --           (159,499)            --               --
 Curtailments/Settlements/Termination Benefits                   59,506             --             11,730             --
 Transfers from DC Plans                                         17,685             --               --               --
                                                              ---------        ---------        ---------        ---------
  Benefit Obligation at December 31                           $ 172,431        $    --          $ 308,812        $ 299,013
                                                              ---------        ---------        ---------        ---------

Change in plan assets:
 Fair value of plan assets at beginning of year               $    --          $   5,180        $  13,010        $   7,795
 Actual return on plan assets                                      --             11,421              104              137
 Benefits paid                                                  (12,505)          (7,527)          (5,319)          (7,508)
 Business combinations                                             --             (9,074)            --               --
 Transfers from DC Plans                                         17,685             --               --               --
                                                              ---------        ---------        ---------        ---------
 Fair value of plan assets at December 31                     $   5,180        $    --          $   7,795        $     424
                                                              ---------        ---------        ---------        ---------
 Plan assets in excess of (less than)
    benefit obligation                                        $(167,252)       $    --          $(301,017)       $(298,589)
 Unrecognized prior service cost                                 76,714             --            (40,486)         (36,568)
 Unrecognized net actuarial (gain)loss                             --               --            (71,942)         (70,034)
                                                              ---------        ---------        ---------        ---------
 Net amount recognized at December 31                         $ (90,538)       $    --          $(413,445)       $(405,191)
                                                              =========        =========        =========        =========

 Amounts recognized in the statement
    of financial position consist of:
 Accrued benefit liability                                    $(167,252)       $    --          $(413,445)       $(405,191)
 Intangible asset                                                76,714             --               --               --
                                                              ---------        ---------        ---------        ---------
 Net amount recognized                                        $ (90,538)       $    --          $(413,445)       $(405,191)
                                                              =========        =========        =========        =========
</TABLE>
      Net Periodic (credit) costs for pension and postretirement  benefits other
than pensions  (principally  health care and life  insurance)  for employees and
covered dependents.
<TABLE>
<CAPTION>
                                                                                                    Postretirement Benefits
                                                                 Pension Benefits                     Other Than Pensions
                                                                 ----------------                   ----------------------
                                                              1997           1998            1996            1997             1998
                                                              ----           ----            ----            ----             ----
                                                              (Dollars in Thousands)                 (Dollars in Thousands)
<S>                                                         <C>            <C>             <C>             <C>             <C>     
Components of net periodic (credit) cost:
Service cost                                                $  2,278       $  1,467        $  3,953        $  2,488        $  2,231
Interest cost                                                  4,172          3,518          23,982          20,950          19,172
Expected return on plan assets                                  --              204            --              --              (156)
Curtailment (gain)/loss                                       66,676           --              --              --              --
Amortization of prior service cost                             2,877          2,149            --              --            (3,918)
Recognized actuarial (gain) /loss                               --             (288)         (3,888)         (7,490)         (5,696)
                                                            --------       --------        --------        --------        --------
Total                                                       $ 76,003       $  7,050        $ 24,047        $ 15,948        $ 11,633
                                                            ========       ========        ========        ========        ========
</TABLE>

                                      -33-
<PAGE>

            The  discount  rate and  rates  of  compensation  increases  used in
determining  the benefit  obligations at December 31, 1998,  1997, and 1996, and
the expected long-term rate of return on assets in each of the years 1998, 1997,
and 1996 were as follows.
<TABLE>
<CAPTION>
                                       1997        1998         1996        1997        1998
                                       ----        ----         ----        ----        ----
<S>                                   <C>         <C>           <C>         <C>         <C> 
      Discount rate                     7.0%        7.0%        7.0%        7.0%        6.5%
      Expected return on assets        10.0%       10.0%        8.0%        8.0%        8.0%
      Rate of compensation increase   N/A         N/A            --          --          --
      Medical care cost trend rate    N/A         N/A           9.5%        9.0%        8.5%
</TABLE>

401-K PLAN

      Effective  January 1, 1994 the Company began  matching  salaried  employee
contributions  to the 401(k) plan with shares of the Company's Common Stock. The
Company matches 50% of the employees contributions. The employer contribution is
limited to a maximum of 3% of an employee's  salary.  Matching  contributions of
WHX Common  Stock  pursuant  to the 401(k)  plan are  charged to the  Company at
market value through the intercompany  accounts.  At December 31, 1996, 1997 and
1998, the 401(k) plan held 190,111 shares,  275,537 shares and 288,157 shares of
WHX Common Stock, respectively.

  POSTEMPLOYMENT BENEFITS

      The  Company  provides  benefits  to former or  inactive  employees  after
employment  but  before  retirement.   Those  benefits  include,  among  others,
disability,  severance and workers' compensation. The assumed discount rate used
to measure  the  benefit  liability  was 7.0% at  December  31, 1997 and 6.5% at
December 31, 1998.

  OTHER POSTRETIREMENT BENEFITS

      The  Company  sponsors   postretirement  benefit  plans  that  cover  both
management  and  hourly  retirees  and  dependents.  The plans  provide  medical
benefits  including  hospital,  physicians'  services and major medical  expense
benefits and a life  insurance  benefit.  The hourly  employees'  plans  provide
non-contributory  basic medical and a supplement to Medicare benefits, and major
medical coverage to which the Company  contributes 50% of the insurance  premium
cost. The management plan has provided basic medical and major medical  benefits
on a non-contributory basis through age 65.

      The Company  accounts for these  benefits in accordance  with Statement of
Financial  Accounting Standards No. 106 (SFAS No. 106),  "Employers'  Accounting
for  Post-retirement  Benefits Other Than Pensions." The cost of  postretirement
medical  and life  benefits  for  eligible  employees  are  accrued  during  the
employee's  service  period  through the date the employee  reaches full benefit
eligibility.  The Company  defers and  amortizes  recognition  of changes to the
unfunded  obligation that arise from the effects of current  actuarial gains and
losses and the effects of changes in assumptions. The Company funds the plans as
current benefit  obligations are paid.  Additionally,  in 1994 the Company began
funding  a  qualified  trust  in  accordance  with  it's  collective  bargaining
agreement. The new collective bargaining agreement provides for the use of those
funds to pay current benefit  obligations and suspends  additional funding until
2002.

      For measurement purposes,  medical costs are assumed to increase at annual
rates as stated above and  declining  gradually to 4.5% in 2004 and beyond.  The
health care cost trend rate assumption has  significant  effect on the costs and
obligation  reported.  A 1%  increase in the health care cost trend rate in each
year would result in  approximate  increases in the  accumulated  postretirement
benefit  obligation  of $24.3  million,  and net  periodic  benefit cost of $4.3
million.  A 1%  decrease  in the health  care cost trend rate in each year would
result  in  approximate  decreases  in the  accumulated  postretirement  benefit
obligation of $21.6 million, and net periodic benefit cost of $3.3 million.

                                      -34-
<PAGE>
  COAL INDUSTRY RETIREE HEALTH BENEFIT ACT

      The Coal Industry Retiree Health Benefit Act of 1992 ("the Act") created a
new United Mine Workers of America postretirement medical and death benefit plan
to replace two existing plans which had developed significant deficits.  The Act
assigns  companies the remaining  benefit  obligations for former  employees and
beneficiaries,  and a pro rata  allocation  of  benefits  related to  unassigned
beneficiaries  (orphans).  The Company's obligation under the Act relates to its
previous ownership of coal mining operations.

       At  December  31,  1997  the  actuarially  determined  accrued  liability
discounted at 7% covering 532 assigned  retirees and dependents and 133 orphans,
totaled $10.8  million.  The Company  recorded an  extraordinary  charge of $1.7
million (net of tax) in 1997 related to  assignment of  additional  orphans.  At
December 31, 1998,  the  actuarially  determined  liability  discounted  at 6.5%
covering 494 assigned  retirees and  dependents  and 188 orphans,  totaled $11.0
million.

NOTE E--INCOME TAXES
<TABLE>
<CAPTION>
                                                                                   Year ended December 31, 
                                                                     1996                    1997                    1998
                                                                     ----                    ----                    ----
                                                                                   (Dollars in thousands)
<S>                                                               <C>                    <C>                    <C>      
INCOME TAXES BEFORE EXTRAORDINARY ITEMS
Current
  Federal tax provision (benefit) ...................             $  (1,317)             $       0              $      93
  State tax provision ...............................                   380                    460                    400
                                                                  ---------              ---------              --------- 
Total income taxes current ..........................                  (937)                   460                    493
                                                                  ---------              ---------              --------- 
Deferred
  Federal tax provision (benefit) ...................                (6,572)              (110,495)                (3,594)
                                                                  ---------              ---------              --------- 
Income tax provision (benefit) ......................             $  (7,509)             $(110,035)             $  (3,101)
                                                                  =========              =========              ========= 

TOTAL INCOME TAXES
Current
  Federal tax provision (benefit) ...................             $  (1,317)             $    --                $      93
  State tax provision ...............................                   380                    460                    400
                                                                  ---------              ---------              --------- 
Total income taxes current ..........................                  (937)                   460                    493
                                                                  ---------              ---------              --------- 

Deferred
  Federal tax provision (benefit) ...................                (6,572)              (124,490)                (3,594)
                                                                  ---------              ---------              --------- 
Income tax provision (benefit) ......................             $  (7,509)             $(124,030)             $  (3,101)
                                                                  =========              =========              ========= 

COMPONENTS OF TOTAL INCOME TAXES
Operations ..........................................             $  (7,509)             $(110,035)             $  (3,101)
Extraordinary items .................................                  --                  (13,995)                  --
                                                                  ---------              ---------              --------- 
Income tax provision (benefit) ......................             $  (7,509)             $(124,030)             $  (3,101)
                                                                  =========              =========              ========= 
</TABLE>


                                      -35-
<PAGE>

            Deferred  income  taxes  result from  temporary  differences  in the
financial basis and tax basis of assets and liabilities. The type of differences
that give rise to  deferred  income tax  liabilities  or assets are shown in the
following table:

DEFERRED INCOME TAX SOURCES
<TABLE>
<CAPTION>
                                                                                1997                 1998
                                                                                ----                 ----
                                                                                   (Dollars in millions)
<S>                                                                          <C>                  <C>     
ASSETS

Postretirement and postemployment employee benefits ....................     $  147.7             $  143.6
Operating loss carryforward (expiring in 2005 to 2012) .................         76.7                 60.1
Minimum tax credit carryforwards (indefinite carryforward) .............         49.5                 51.4
Provision for expenses and losses ......................................         87.0                 47.4
Leasing activities .....................................................         23.8                 22.2
State income taxes .....................................................          1.4                  1.3
Miscellaneous other ....................................................          7.5                  5.5
                                                                             --------             --------
     Deferred tax assets ...............................................        393.6                331.5
                                                                             --------             --------

LIABILITIES

Property plant and equipment ...........................................       (166.1)              (155.9)
Inventory ..............................................................        (34.9)               (30.3)
Pension ................................................................          0.0                 (1.4)
State income taxes .....................................................         (1.0)                (0.9)
Miscellaneous other ....................................................         (6.8)                (0.5)
                                                                             --------             --------
     Deferred tax liability ............................................       (208.8)              (189.0)
Valuation allowance ....................................................        (20.0)               (22.5)
                                                                             --------             --------
Deferred income tax asset--net .........................................     $  164.8             $  120.0
                                                                             ========             ========
</TABLE>

            As of December 31, 1998, for financial  statement reporting purposes
a balance of  approximately  $20.0  million of  prereorganization  tax  benefits
exist.  These  benefits will be reported as a direct  addition to equity as they
are  recognized.  The  increase  to  the  valuation  allowance  during  1998  is
attributable  to the  recognition  of tax  credits  that  will  expire  prior to
realization.  No prereorganization tax benefits were recognized in 1996, 1997 or
1998.

            During 1994, the Company  experienced an ownership change as defined
by Section 382 of the Internal  Revenue Code.  As the result of this event,  the
Company will be limited in its ability to use net operating  loss  carryforwards
and certain  other tax  attributes to reduce  subsequent  tax  liabilities.  The
amount of taxable  income that can be offset by pre-change tax attributes in any
annual period is limited to approximately $32 million per year.

            A tax sharing  agreement  between the Company and WHX determines the
tax  provision  and related tax payments or refunds  allocated to the Company in
years in which they are combined in a  consolidated  federal  income tax return.
The tax  sharing  agreement  stipulates  that  WPSC,  shall  be  deemed  to have
succeeded  to the  portion  of the net  operating  loss  and  credit  carryovers
attributable to the steel group on December 31, 1990.


                                      -36-
<PAGE>
            Total  federal and state  income  taxes paid in 1996,  1997 and 1998
were $3.5 million, $.7 million and $1.2 million, respectively.

            Federal  tax returns  have been  examined  by the  Internal  Revenue
Service  ("IRS")  through 1987. The statute of limitations has expired for years
through  1994;  however,  the IRS can  review  prior  years to adjust  any NOL's
incurred in such years and carried  forward to offset income in subsequent  open
years. Management believes it has adequately provided for all taxes on income.

            The provision for income taxes differs from the amount of income tax
determined by applying the applicable U.S.  statutory federal income tax rate to
pretax income as follows:

<TABLE>
<CAPTION>
                                                                                                    December 31,
                                                                                -------------------------------------------------
                                                                                   1996                 1997                 1998
                                                                                   ----                 ----                 ----
                                                                                               (Dollars in thousands)
<S>                                                                             <C>                  <C>                  <C>       
Income (loss) before taxes and ......................................           $ (12,792)           $(314,498)           $  (9,604)
                                                                                =========            =========            ========= 
  extraordinary item

Tax provision (benefit) at statutory rate ...........................           $  (4,477)           $(110,074)           $  (3,361)
Increase (reduction) in tax due to:
  Percentage depletion ..............................................              (1,027)              (1,092)                (829)
  Equity earnings ...................................................              (2,408)                 338               (1,484)
  State income tax net of federal effect ............................                 260                  299                  260
  Change in valuation allowance .....................................                --                   --                  2,481
  Other miscellaneous ...............................................                 143                  494                 (168)
                                                                                ---------            ---------            --------- 
Tax provision (benefit) .............................................           $  (7,509)           $(110,035)           $  (3,101)
                                                                                =========            =========            ========= 
</TABLE>

NOTE F--INVENTORIES

                                                             December 31,
                                                     ---------------------------
                                                        1997              1998
                                                        ----              ----
                                                       (Dollars in thousands)

Finished products ...........................        $  34,233         $  33,936
In-process ..................................          106,270           114,416
Raw materials ...............................          105,648            74,988
Other materials and supplies ................           19,875            33,373
                                                     ---------         ---------
                                                       266,026           256,713
LIFO reserve ................................          (10,169)            2,626
                                                     ---------         ---------
                                                     $ 255,857         $ 259,339
                                                     =========         =========

            During 1997 and 1998,  certain  inventory  quantities  were reduced,
resulting in  liquidations  of LIFO  inventories,  the effect of which increased
income  by  approximately  $0.6  million  and $1.8  million  in 1997  and  1998,
respectively.


                                      -37-
<PAGE>
NOTE G--PROPERTY, PLANT AND EQUIPMENT
                                                             December 31,
                                                       ------------------------
                                                          1997           1998
                                                          ----           ----
                                                         (Dollars in thousands)

Land and mineral properties ......................     $    7,071     $    7,715
Buildings, machinery and equipment ...............      1,034,189      1,070,946
Construction in progress .........................         21,741         17,185
                                                       ----------     ----------
                                                        1,063,001      1,095,846
Accumulated depreciation and amortization ........        368,893        444,760
                                                       ----------     ----------
                                                       $  694,108     $  651,086
                                                       ==========     ==========

            The Company  utilizes the  modified  units of  production  method of
depreciation which recognizes that the depreciation of steelmaking  machinery is
related to the physical  wear of the  equipment  as well as a time  factor.  The
modified  units of production  method  provides for straight  line  depreciation
charges modified  (adjusted) by the level of raw steel  production.  In 1997 and
1998  depreciation  under the  modified  units of  production  method  was $21.6
million or 40% less and $1.1  million or 2% more,  respectively,  than  straight
line  depreciation.  The 1997 reduction in depreciation  primarily  reflects the
ten-month  strike  which began  October 1, 1996 and  continued  until August 12,
1997.

NOTE H--LONG-TERM DEBT
                                                                December 31,
                                                            -------------------
                                                             1997         1998
                                                             ----         ----
                                                          (Dollars in thousands)

Senior Unsecured Notes due 2007, 9 1/4% ..............     $273,966     $274,071
Term Loan Agreement due 2006, floating rate ..........       75,000       75,000
Other ................................................        1,137          921
                                                           --------     --------
                                                            350,103      349,992
Less portion due within one year .....................          199          217
                                                           --------     --------
     Total Long-Term Debt(1) .........................     $349,904     $349,775
                                                           ========     ========


(1)  The fair value of long-term debt at December 31, 1997 and December 31, 1998
     was  $350.1  million  and  $331.7  million,  respectively.  Fair  value  of
     long-term debt is estimated based on trading in the public market.

     Long-term debt maturing in each of the next five years is as follows: 1999,
     $217; 2000, $217; 2001, $233; 2002, $246 and 2003, $0.

            A summary of the financial agreements at December 31, 1998 follows:

  REVOLVING CREDIT FACILITY:

            In December  1995,  WPSC entered into a Second  Amended and Restated
Revolving Credit Facility ("RCF") with Citibank, N.A. as agent. The RCF provides
for  borrowings  for general  corporate  purposes  up to $150  million and a $35
million sub-limit for Letters of Credit.

            The Credit  Agreement  expires  May 3, 1999 and is  currently  being
renegotiated.  Interest  rates are based on the  Citibank  prime  rate plus 1.0%
and/or a Eurodollar rate plus 2.25%, but, the margin over the prime rate and the
Eurodollar rate can fluctuate based upon performance. A commitment fee of .5% is
charged  on the  unused  portion.  The letter of credit fee is 2.25% and is also
performance based.



                                      -38-
<PAGE>
            Borrowings are secured  primarily by 100% of the eligible  inventory
of WPSC,  Pittsburgh-Canfield  Corporation  ("PCC")  and  Wheeling  Construction
Products,  Inc. ("WCPI"),  and the terms of the RCF contain various  restrictive
covenants,  limiting among other things dividend payments or other  distribution
of assets,  as defined in the RCF. The Company is a  wholly-owned  subsidiary of
WHX. WPSC, PCC and WCPI are  wholly-owned  subsidiaries of the Company.  Certain
financial covenants associated with leverage, net worth, capital spending,  cash
flow and  interest  coverage  must be  maintained.  WPC,  PCC and WCPI have each
guaranteed all of the obligations of WPSC under the Revolving  Credit  Facility.
Borrowings  outstanding  against the RCF at  December  31,  1998  totaled  $67.0
million.  Letters  of credit  outstanding  under the RCF were  $8.6  million  at
December 31, 1998.

            In August 1994 WPSC entered into a separate  facility for letters of
credit up to $50 million.  At December 31, 1998 letters of credit  totaling $7.7
million  were  outstanding  under  this  facility.  The  letters  of credit  are
collateralized at 105% with U.S. Government securities owned by the Company, and
are  subject  to an  administrative  charge  of .4% per  annum on the  amount of
outstanding letters of credit.

 9 3/8 % SENIOR NOTES DUE 2003:

            In November 1997, the Company,  under the terms of the 9 3/8% Senior
Notes,  defeased the remaining $266.2 million 9d% Senior Notes  outstanding at a
total cost of $298.8 million.  The 9d% Senior Notes were placed into trusteeship
where they will be held until redemption on November 15, 2000.

9 1/4% SENIOR NOTES DUE 2007:

            On  November  26, 1997 the Company  issued  $275  million  principal
amount of 9 1/4% Senior  Notes.  Interest on the 9 1/4% Senior  Notes is payable
semi-annually  on May 15 and November 15 of each year,  commencing May 15, 1998.
The Senior  Notes  mature on November  15,  2007.  The 9 1/4% Senior  Notes were
exchanged for identical  notes which were issued  pursuant to an exchange  offer
registered under the Securities Act of 1933, as amended.

            The 9 1/4% Senior Notes are redeemable at the option of the Company,
in whole or in part,  on or after  November  15,  2002 at  specified  redemption
prices,  plus accrued  interest and liquidated  damages,  if any, thereon to the
date of redemption.

            Upon the occurrence of a Change of Control (as defined), the Company
will be required to make an offer to repurchase all or any part of each holder's
Senior Notes at 101% of the principal  amount  thereof,  plus accrued and unpaid
interest and liquidated damages, if any, thereon to the date of repurchase.

            The 9 1/4% Senior Notes are  unsecured  obligations  of the Company,
ranking  senior in right of payment  to all  existing  and  future  subordinated
indebtedness of the Company,  and pari passu with all existing and future senior
unsecured indebtedness of the Company,  including borrowings under the Term Loan
Agreement.

            The 9 1/4% Senior Notes are fully and unconditionally  guaranteed on
a joint and several and senior  basis by the  guarantors,  which  consist of the
Company's  present and future  operating  subsidiaries.  The 9 1/4% Senior Notes
indenture contains certain covenants,  including,  but not limited to, covenants
with respect to: (i) limitations on indebtedness; (ii) limitations on restricted
payments; (iii) limitations on transactions with affiliates; (iv) limitations on
liens; (v) limitations on sales of assets; (vi) limitations on issuance and sale
of capital  stock of  subsidiaries;  (vii)  limitations  on dividends  and other
payment  restrictions  affecting   subsidiaries;   and  (viii)  restrictions  on
consolidations, mergers and sales of assets.

TERM LOAN AGREEMENT

            On  November  26,  1997 the  Company  entered  into  the  Term  Loan
Agreement with DLJ Capital 
                                      -39-
<PAGE>
Funding Inc., as syndication  agent pursuant to which it borrowed $75 million.

            Amounts  outstanding  under the Term Loan Agreement bear interest at
the base rate (as  defined  therein)  plus  2.25% or the LIBO  rate (as  defined
therein) plus 3.25%.  Interest on the Term Loan is payable on March 15, June 15,
September  15 and  December 15 as to Base Rate Loans,  and with respect to LIBOR
loans on the last day of each applicable  interest period,  and if such interest
period shall exceed three  months,  at intervals of three months after the first
day of such interest period.

            The  Company's   obligations  under  the  Term  Loan  Agreement  are
guaranteed  by its present and future  operating  subsidiaries.  The Company may
prepay the obligations  under the Term Loan Agreement  beginning on November 15,
1998, subject to a premium of 2.0% of the principal amount thereof. Such premium
declines to 1.0% on November  15, 1999 with no premium on or after  November 15,
2000.

  INTEREST COST

            Aggregate interest costs on debt and amounts  capitalized during the
three years ended December 31, 1998, are as follows:

                                                      1996      1997      1998
                                                      ----      ----      ----
                                                        (Dollars in thousands)

Aggregate interest expense on long-term debt .....   $26,263   $29,431   $38,762
Less: Capitalized interest .......................     2,500     2,227     2,063
                                                     -------   -------   -------
Interest expense .................................   $23,763   $27,204   $36,699
                                                     =======   =======   =======
Interest Paid ....................................   $27,660   $29,515   $36,924
                                                     =======   =======   =======


NOTE I--STOCKHOLDER'S EQUITY

            Changes in capital accounts are as follows:
<TABLE>
<CAPTION>
                                          Common Stock         Accumulated           Capital
                                                                Earnings            in Excess
                                     Shares       Amount        (Deficit)          of Par Value
                                     ------       ------        ---------          ------------
                                                        (Dollars in thousands)
<S>                                   <C>       <C>            <C>                   <C>     
Balance January 1, 1996               100       $      0       $  78,383             $265,387
Net income (loss)                      --             --          (5,283)                  --
                                      ---       --------       ---------             --------
Balance December 31, 1996             100              0          73,100              265,387
Net income (loss)                      --             --        (230,453)                  --
WPN stock option                       --             --               --               6,678
                                      ---       --------       ---------             --------
Balance December 31, 1997             100              0        (157,353)             272,065
Net income (loss)                      --             --          (6,503)                  --
Contribution To Capital                --             --               --              63,073
                                      ---       --------       ---------             --------
Balance December 31, 1998             100       $      0       $(163,856)            $335,138
                                      ===       ========       =========             ========
</TABLE>

            Pursuant to a  reorganization  of the Company  effective on July 26,
1994, WPC became a wholly-owned  subsidiary of WHX. WHX, a new holding  company,
became the publicly held issuer for all of the outstanding  Common and Preferred
Stock and  outstanding  warrants of WPC and assumed WPC's rights and obligations
with respect to WPC's option plans, all as described below.

            Pursuant to  reorganization  of the Company,  WHX assumed the rights
and  obligations  of WPC under WPC's stock  option plans and WHX Common Stock is
issuable in lieu of each share of WPC Common Stock required by the plans.



                                      -40-
<PAGE>

            The Company  accounts  for grants of options to purchase  WHX Common
Stock in accordance with Interpretation 1 to Accounting Principles Board Opinion
No. 25  "Accounting  for Stock  Issued to  Employees".  Options to purchase  WHX
Common Stock are granted at market value and cash is paid to WHX when the option
is exercised. No employee compensation amounts are recorded upon the issuance of
options to purchase WHX Common Stock.

            On  August  4,  1997  the  compensation  committee  of the  Board of
Directors  of WHX granted an option to purchase  1,000,000  shares of WHX Common
Stock to WPN Corp,  at the then market price per share,  subject to  stockholder
approval for its performance in negotiating a new five-year labor agreement. The
Board  of  Directors  approved  such  grant  on  September  25,  1997,  and  the
stockholders approved it on December 1, 1997 (measurement date). The WPN options
are exercisable with respect to one-third of the shares of Common Stock issuable
upon the  exercise  thereunder  at any time on or after the date of  stockholder
approval  of the Option  Grants.  The  options  with  respect  to an  additional
one-third of the shares of Common Stock may be exercised on the first and second
anniversaries of the Approval Date, respectively. The options, to the extent not
previously exercised, will expire on August 4, 2007, respectively.

            The Company is required to record a charge for the fair value of the
1997 option  grants under  Statement of Financial  Accounting  Standards No. 123
("SFAS No.123") ("Accounting for Stock-Based  Compensation").  The fair value of
the option grant is estimated on the measurement  date using the  Black--Scholes
option-pricing  model. The following assumptions were used in the Black--Scholes
calculation:  expected volatility of 48.3%, risk-free interest rate of 5.83%, an
expected life of 5 years and a dividend yield of zero.  The resulting  estimated
fair value of the shares  granted in 1997 was $6.7 million which was recorded as
part of the special charge related to the new labor agreement.

            Effective  May 31, 1998,  WHX merged WPC's defined  benefit  pension
plan with those of its  wholly  owned  Handy & Harman  ("H&H")  subsidiary.  The
pension   obligations  will  be  accounted  for  by  the  parent  company  as  a
multi-employer  pension plan. As a result of the merger of the pension plans and
based on current actuarial assumptions, on a consolidated basis, WHX will report
a net prepaid pension asset of $44.5 million. The merger will also eliminate WPC
cash funding  obligations  estimated  in excess of $135.0  million over the next
four years.  The pension  liability  on the WPC books at the time of the pension
merger,  net  of  the  deferred  tax  asset,  was  eliminated  and  credited  to
paid-in-capital.  WPC pension  expense will be allocated and charged  quarterly,
and will offset the net prepaid  pension asset  recorded by the parent  company.
Pension expense allocated to WPC under this plan in 1998 totaled $9.8 million.

NOTE J --RELATED PARTY TRANSACTION

            The  Chairman  of  the  Board  of  WHX is  the  President  and  sole
shareholder  of WPN Corp.  Pursuant to a  management  agreement  effective as of
January  3, 1991,  as  amended,  approved  by a  majority  of the  disinterested
directors of WHX, WPN Corp. provides certain financial,  management advisory and
consulting services to WPC. Such services include, among others, identification,
evaluation and negotiation of acquisitions and diverstitures, responsibility for
financing  matters,  review of annual and  quarterly  budgets,  supervision  and
administration,  as appropriate, of all WPC's accounting and financial functions
and review and  supervision  of reporting  obligations  under  Federal and state
securities  laws.  In exchange  for such  services,  WPN Corp.  received a fixed
monthly  fee of  $208,333  in 1998  from  the  Company.  In  December  1997  WHX
stockholders  approved  a grant of an option  to  purchase  1,000,000  shares of
Common  Stock to WPN  Corp.  for  their  performance  in  obtaining  a new labor
agreement.  The options  were valued  using the  Black--Scholes  formula at $6.7
million and  recorded as a special  charge  related to the labor  contract.  The
Management  Agreement  has a two year term and is  renewable  automatically  for
successive  one year  periods,  unless  terminated by either party upon 60 days'
prior written notice.

            The Company  regularly  sells steel product to Unimast at prevailing
market prices.  During 1998 and 1997, the Company shipped $27.2 million and $4.8
million,  respectively of steel product. Amounts due the Company at December 31,
1998 and 1997 were $3.4 million and $12.5 million, respectively.



                                      -41-
<PAGE>
NOTE K-COMMITMENTS AND CONTINGENCIES

  ENVIRONMENTAL MATTERS

            The Company has been identified as a potentially  responsible  party
under the Comprehensive  Environmental Response,  Compensation and Liability Act
("Superfund")  or similar state statutes at several waste sites.  The Company is
subject to joint and  several  liability  imposed by  Superfund  on  potentially
responsible parties. Due to the technical and regulatory  complexity of remedial
activities and the difficulties attendant to identifying potentially responsible
parties and  allocating  or  determining  liability  among them,  the Company is
unable to reasonably  estimate the ultimate cost of  compliance  with  Superfund
laws. The Company believes, based upon information currently available, that the
Company's  liability for clean up and  remediation  costs in connection with the
Buckeye  reclamation will be between $2.5 and $3.0 million.  At five other sites
(MIDC  Glassport,  Tex-Tin,  Breslube Penn, Four County Landfill and Beazer) the
Company  estimates  costs to aggregate  approximately  $500,000.  The Company is
currently funding its share of remediation costs.

            The Company,  as are other industrial  manufacturers,  is subject to
increasingly  stringent standards relating to the protection of the environment.
In order to  facilitate  compliance  with  these  environmental  standards,  the
Company has incurred  capital  expenditures for  environmental  control projects
aggregating  $6.8 million,  $12.4  million and $ 9.5 million for 1996,  1997 and
1998, respectively. The Company anticipates spending approximately $30.8 million
in the aggregate on major  environmental  compliance  projects  through the year
2002,  estimated to be spent as follows:  $7.5 million in 1999,  $7.3 million in
2000,  $7.2 million in 2001 and $8.8 million in 2002. Due to the  possibility of
unanticipated  factual  or  regulatory   developments,   the  amount  of  future
expenditures may vary substantially from such estimates.

            Non-current accrued environmental  liabilities totaled $10.6 million
at December 31, 1997 and $12.7 million at December 31, 1998. These accruals were
initially determined by the Company in January 1991, based on all then available
information. As new information becomes available including information provided
by third  parties,  and  changing  laws and  regulations,  the  liabilities  are
reviewed and the accruals adjusted quarterly.  Management believes, based on its
best estimate,  that the Company has adequately  provided for remediation  costs
that  might be  incurred  or  penalties  that  might be  imposed  under  present
environmental laws and regulations.

            Based upon information currently available,  including the Company's
prior capital expenditures, anticipated capital expenditures, consent agreements
negotiated  with  Federal and state  agencies and  information  available to the
Company on pending judicial and administrative proceedings, the Company does not
expect  its  environmental   compliance  and  liability  costs,   including  the
incurrence of additional fines and penalties,  if any, relating to the operation
of its facilities,  to have a material adverse effect on the financial condition
or results of operations of the Company.  However,  as further information comes
into the Company's possession, it will continue to reassess such evaluations.



                                      -42-
<PAGE>

NOTE L--OTHER INCOME
                                                         December 31,
                                              ---------------------------------
                                                1996         1997         1998
                                                ----         ----         ----
                                                    (Dollars in thousands)
Interest and investment income ..........     $ 3,948      $ 4,189      $ 2,702
Equity income ...........................       9,495       (1,206)       5,333
Receivables securitization fees .........      (4,934)      (3,826)      (6,192)
Other, net ..............................         967          622        1,635
                                              -------      -------      -------
                                              $ 9,476      $  (221)     $ 3,478
                                              =======      =======      =======
NOTE M--SALE OF RECEIVABLES

            In 1994, a special purpose wholly-owned  subsidiary of WPSC, entered
into an agreement to sell (up to $75 million on a revolving  basis) an undivided
percentage  ownership in a designated pool of accounts  receivable  generated by
WPSC,  WCPI and PCC. The  agreement  expires in August  1999.  In July 1995 WPSC
amended such  agreement to sell an  additional  $20 million on similar terms and
conditions.  In October  1995 WPSC  entered  into an  agreement  to include  the
receivable  generated  by  Unimast  in the  pool of  accounts  receivable  sold.
Accounts  receivable  at December  31, 1997 and 1998 exclude $69 million and $95
million,  respectively,  representing  uncollected accounts receivable sold with
recourse  limited to the  extent of  uncollectible  balances.  Fees paid by WPSC
under this agreement  range from 5.5438% to 8.50% of the  outstanding  amount of
receivables  sold.  Based  on the  Company's  collection  history,  the  Company
believes that credit risk associated  with the above  arrangement is immaterial.
The Company is currently negotiating a replacement facility.


NOTE N--INFORMATION ON SIGNIFICANT JOINT VENTURES

            The Company owns 35.7% of Wheeling-Nisshin  Inc.  (Wheeling-Nisshin)
Wheeling-Nisshin  had total debt  outstanding  at December  31, 1997 and 1998 of
approximately $18.5 million and $11.6 million, respectively. The Company derived
approximately   5.1%  and  14.6%  of  its   revenues   from  sale  of  steel  to
Wheeling-Nisshin  in 1997  and  1998,  respectively.  The  increase  in  revenue
reflects the effect of the strike on company  shipments to  Wheeling-Nisshin  in
1997.   The  Company   received   dividends  of  $2.5  million   annually   from
Wheeling-Nisshin  in 1996 and 1997 and $5.0  million  in 1998.  Amounts  due the
Company at December 31, 1998 totaled $4.0 million.  Audited financial statements
of  Wheeling-Nisshin  are  presented  at  page 47  because  it is  considered  a
significant subsidiary of the Company under SEC regulations.

            The Company owns 50.0% of Ohio Coatings Company (OCC). OCC had total
debt outstanding at December 31, 1997 and 1998 of  approximately  $57.2 million.
The Company  derived  approximately  1.1% and 6.1% of its revenues  from sale of
steel to OCC in 1997 and 1998 respectively. The increase in revenue reflects the
effect of the strike on the Company's  shipments to OCC in 1997. Amounts due the
Company at December  31, 1998  totaled  $28.0  million,  including an advance of
$16.5 million.

NOTE O -- EXTRAORDINARY CHARGE
                                                             Year Ended
                                                            December 31,
                                                                1997
                                                        (Dollars in thousands)
          Premium on early debt retirement ............      $ 32,600
          Unamortized debt issuance cost ..............         4,770
          Coal retiree medical benefits ...............         2,615
          Income tax effect ...........................       (13,995)
                                                             --------
                                                             $ 25,990
                                                             --------


                                      -43-
<PAGE>

            In  November  1997 the  Company  paid a premium of $32.6  million to
defease the remaining  $266.2  million of the 9 3/8 Senior Notes at a total cost
of $298.8 million.

            In 1997, a 7% discount  rate was used to calculate  the  actuarially
determined coal retiree medical benefit  liability  compared to 7.5% in 1996. In
1997 the Company  also  incurred  higher  premiums for  additional  retirees and
orphans assigned in 1995. See Note D.


NOTE P--SUMMARIZED COMBINED FINANCIAL INFORMATION OF THE SUBSIDIARY GUARANTORS
        OF THE 9 1/4% SENIOR NOTES
<TABLE>
<CAPTION>
                                                                                         Year Ended December 31,
                                                                          ------------------------------------------------
                                                                              1996               1997              1998
                                                                              ----               ----              ----
                                                                                        (Dollars in thousands)
<S>                                                                       <C>               <C>               <C>        
INCOME DATA
          Net sales                                                       $ 1,110,684       $   489,662       $ 1,111,541
          Cost of products sold, excluding depreciation                       987,528           585,609           949,475
          Depreciation                                                         66,125            46,203            76,321
          Selling, general and administrative expense                          54,740            52,294            61,276
          Special charge                                                         --              92,701              --
                                                                          -----------       -----------       -----------
          Operating income(loss)                                                2,291          (287,145)           24,469
          Interest expense                                                     22,983            26,071            31,408
          Other income(loss)                                                     (973)           (1,280)           (3,904)
                                                                          -----------       -----------       -----------
          Income (loss) before tax                                            (21,665)         (314,496)          (10,843)
          Tax provision(benefit)                                              (10,615)         (110,034)           (3,535)
                                                                          -----------       -----------       -----------
          Net income (loss)                                               $   (11,050)      $  (204,462)      $    (7,308)
                                                                          ===========       ===========       ===========
</TABLE>
<TABLE>
<CAPTION>
                                                                                       Year Ended December 31,
                                                                            ----------------------------------------------
                                                                               1996              1997              1998
                                                                               ----              ----              ----
                                                                                        (Dollars in thousands)
<S>                                                                         <C>               <C>               <C>       
BALANCE SHEET DATA
Assets
               Current assets                                               $  267,055        $  324,813        $  311,222
               Non-current assets                                              926,386           990,435           835,287
                                                                            ----------        ----------        ----------
          Total assets                                                      $1,193,441        $1,315,248        $1,146,509
                                                                            ==========        ==========        ==========
          Liabilities and stockholder's equity
               Current liabilities                                          $  152,385        $  311,723        $  262,926
               Non-current liabilities                                         739,762           935,834           760,127
               Stockholder's equity                                            301,294            67,691           123,456
                                                                            ----------        ----------        ----------
          Total liabilities and stockholder's equity                        $1,193,441        $1,315,248        $1,146,509
                                                                            ==========        ==========        ==========
</TABLE>


                                      -44-
<PAGE>
NOTE Q--QUARTERLY INFORMATION (UNAUDITED)

            Financial results by quarter for the two fiscal years ended December
31, 1997 and 1998 are as follows:
<TABLE>
<CAPTION>
                                                                                         Earnings (Loss) Per       Earnings
                                        Gross Profit    Extraordinary    Net Income        Share Before         (Loss) Per 
                         Net Sales         (Loss)         Charge            (Loss)      Extraordinary Charge        Share  
                         ---------         ------         ------            ------      --------------------        -----  
                                                                    (Dollars in thousands)
<S>                        <C>            <C>              <C>             <C>                <C>                   <C>
1997:(1)
1st Quarter..........      79,014         (34,139)             --          (40,251)            *                    *
2nd Quarter..........      87,878         (20,825)             --          (34,584)
3rd Quarter..........     103,217         (31,621)             --          (96,785)
4th Quarter..........     219,553          (9,362)        (25,990)         (58,833)
1998:
1st Quarter..........     259,121          29,182              --           (8,951)            *                    *
2nd Quarter..........     288,767          52,361              --            6,092
3rd Quarter..........     297,717          45,247              --            1,959
4th Quarter..........     265,936          34,671              --           (5,603)
</TABLE>

*    Earnings per share are not meaningful because the Company is a wholly-owned
     subsidiary of WHX Corporation.

(1)  The  financial  results of the Company  for all four  quarters of 1997 were
     adversely  affected by the strike.  Negative impacts of the strike included
     the volume  effect of lower  production  on fixed cost  absorption,  higher
     levels of external steel purchases, start-up costs and a higher-cost mix of
     products shipped.


                                      -45-
<PAGE>

ITEM 9.     CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND 
            FINANCIAL DISCLOSURES.

                  NOT APPLICABLE

                                    PART III

                  OMITTED


                                     PART IV

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

            (a) 2.  Audited Financial Statements of Wheeling-Nisshin, Inc.

            The following audited Financial Statements of Wheeling-Nisshin, Inc.
are presented because Wheeling-Nisshin is considered a significant subsidiary as
defined under SEC Regulations.




                                      -46-

<PAGE>
                        REPORT OF INDEPENDENT ACCOUNTANTS

To the Shareholders and Board of Directors of
Wheeling-Nisshin, Inc.:

In our opinion,  the accompanying  balance sheets and the related  statements of
income,  shareholders'  equity and of cash flows present fairly, in all material
respects,  the  financial  position of  Wheeling-Nisshin,  Inc. (the Company) at
December 31, 1998 and 1997, and the results of its operations and its cash flows
for each of the three years in the period ended December 31, 1998, in conformity
with generally accepted accounting  principles.  These financial  statements are
the responsibility of the Company's management; our responsibility is to express
an opinion on these financial  statements based on our audits.  We conducted our
audits of these  statements  in  accordance  with  generally  accepted  auditing
standards, which require that we plan and perform the audit to obtain reasonable
assurance   about  whether  the  financial   statements  are  free  of  material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the  amounts  and  disclosures  in  the  financial  statements,   assessing  the
accounting  principles  used and significant  estimates made by management,  and
evaluating the overall  financial  statement  presentation.  We believe that our
audits provide a reasonable basis for the opinion expressed above.









PricewatehouseCoopers LLP
Pittsburgh, Pennsylvania
February 16,1999



                                      -47-
<PAGE>
                             WHEELING-NISSHIN, INC.

                                 BALANCE SHEETS
                           DECEMBER 31, 1998 AND 1997
                             (DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                               1998         1997
                                                                               ----         ----

                                     ASSETS
<S>                                                                          <C>          <C>     
Current assets:
  Cash and cash equivalents ............................................     $ 21,278     $ 22,313
  Investments ..........................................................       48,659       28,500
  Trade accounts receivable, net of allowance for 
    bad debts of $250 in 1998 and 1997 (Note 8).........................       10,262       16,364
  Inventories (Note 3) .................................................       13,797       16,793
  Prepaid income taxes .................................................        1,507          139
  Deferred income taxes (Note 6) .......................................        2,654        2,342
  Other current assets .................................................          432          622
                                                                             --------     --------
        Total current assets ...........................................       98,589       87,073
Property, plant and equipment, net (Note 4) ............................      111,788      124,787
Debt issuance costs, net of accumulated amortization 
  of $1,792 in 1998 and $1,704 in 1997..................................          109          197
Other assets ...........................................................          602          719
                                                                             --------     --------
        Total assets ...................................................     $211,088     $212,776
                                                                             ========     ========

                      LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
  Accounts payable .....................................................     $  5,381     $ 10,684
  Due to affiliates (Note 8) ...........................................        3,968        3,356
  Accrued interest .....................................................          237          367
  Other accrued liabilities ............................................        3,970        3,260
  Accrued profit sharing ...............................................        6,290        4,644
  Current portion of long-term debt (Note 5) ...........................        6,775        6,835
                                                                             --------     --------
        Total current liabilities ......................................       26,621       29,146
Long-term debt, less current portion (Note 5) ..........................        4,824       11,645
Deferred income taxes (Note 6) .........................................       26,271       25,262
Other long-term liabilities (Note 9) ...................................        2,500        2,500
                                                                             --------     --------
        Total liabilities ..............................................       60,216       68,553
                                                                             --------     --------
Commitments and contingencies (Note 8 and 9)
Shareholders' equity:
  Common stock, no par value; authorized, issued 
    and outstanding, 7,000 shares.......................................       71,588       71,588
  Retained earnings ....................................................       79,284       72,635
                                                                             --------     --------
    Total shareholders' equity .........................................      150,872      144,223
                                                                             --------     --------
        Total liabilities and shareholders' equity .....................     $211,088     $212,776
                                                                             ========     ========
</TABLE>

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



                                      -48-
<PAGE>
                             WHEELING-NISSHIN, INC.

                              STATEMENTS OF INCOME
              FOR THE YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996
                  (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)

<TABLE>
<CAPTION>
                                                                                   1998                 1997                  1996
                                                                                ---------            ---------            ---------
<S>                                                                             <C>                  <C>                  <C>      
Net Sales (Note 8) ..................................................           $ 379,415            $ 396,278            $ 375,658
Cost of goods sold (Note 8) .........................................             341,877              365,967              335,071
                                                                                ---------            ---------            ---------
    Gross profit ....................................................              37,538               30,311               40,587
Selling, general and administrative expenses ........................               6,957                5,608                6,546
                                                                                ---------            ---------            ---------
    Operating profit ................................................              30,581               24,703               34,041
                                                                                ---------            ---------            ---------

Other income (expense):
  Interest and other income .........................................               3,002                2,203                2,539
  Interest expense ..................................................                (985)              (1,398)              (1,909)
                                                                                ---------            ---------            ---------
                                                                                    2,017                  805                  630
                                                                                ---------            ---------            ---------
    Income before income taxes ......................................              32,598               25,508               34,671
Provision for income taxes (Note 6) .................................              11,949                9,435               13,110
    Net income ......................................................           $  20,649            $  16,073            $  21,561
                                                                                =========            =========            =========
Earnings per share ..................................................           $    2.95            $    2.30            $    3.08
                                                                                =========            =========            =========
</TABLE>
    The accompanying notes are an integral part of the financial statements.



                                      -49-
<PAGE>
                             WHEELING-NISSHIN, INC.

                       STATEMENTS OF SHAREHOLDERS' EQUITY
              FOR THE YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996
                             (DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
                                                                                                   Retained
                                                                          Common Stock             Earnings                  Total
                                                                          ------------             --------                  -----

<S>                                                                        <C>                    <C>                     <C>      
Balance at December 31, 1995 ................................              $  71,588              $  49,001               $ 120,589
Net income ..................................................                   --                   21,561                  21,561
Cash dividends ($1 per share) ...............................                   --                   (7,000)                 (7,000)
                                                                           ---------              ---------               ---------

Balance at December 31, 1996 ................................                 71,588                 63,562                 135,150
Net income ..................................................                   --                   16,073                  16,073
Cash dividends ($1 per share) ...............................                   --                   (7,000)                 (7,000)
                                                                           ---------              ---------               ---------

Balance at December 31, 1997 ................................                 71,588                 72,635                 144,223
Net income ..................................................                   --                   20,649                  20,649
Cash dividends ($2 per share) ...............................                   --                  (14,000)                (14,000)
                                                                           ---------              ---------               ---------

Balance at December 31, 1998 ................................              $  71,588              $  79,284               $ 150,872
                                                                           =========              =========               =========

</TABLE>

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




                                      -50-
<PAGE>
                             WHEELING-NISSHIN, INC.

                            STATEMENTS OF CASH FLOWS
              FOR THE YEARS ENDED DECEMBER 31, 1998, 1997 AND 1996
                             (DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                                   1998            1997            1996
<S>                                                                             <C>             <C>             <C>     
Cash flows from operating activities:
  Net income ............................................................       $ 20,649        $ 16,073        $ 21,561
  Adjustments to reconcile net income to
    net cash provided by operating activities:
    Depreciation and amortization .......................................         13,396          13,065          12,952
    Loss on disposal of land ............................................              6            --              --
    Deferred income taxes ...............................................            697           1,141           5,330
    Net change in operating assets and liabilities:
      Decrease (increase) in trade accounts receivable ..................          6,102           3,401            (730)
      Decrease (increase) in inventories ................................          2,996           5,440          (3,467)
      (Increase) decrease in prepaid and accrued 
        income taxes.....................................................         (1,368)         (3,322)            (51)
      Decrease (increase) in other assets ...............................            190             197            (636)
      (Decrease) increase in accounts payable ...........................         (5,303)        (10,542)         12,846
      Increase (decrease) in due to affiliates ..........................            612           3,356          (6,036)
      Decrease in accrued interest ......................................           (130)           (130)           (173)
      (Decrease) increase in other accrued liabilities ..................          2,356          (1,989)            945
                                                                                --------        --------        --------
        Net cash provided by operating activities .......................         40,203          26,690          42,541
                                                                                --------        --------        --------

Cash flows from investing activities:
  Capital expenditures, net .............................................           (222)           (959)         (1,173)
  Proceeds from sale of land ............................................             24            --              --
  Purchase of investments ...............................................        (44,214)        (43,700)        (19,900)
  Maturity of investments ...............................................         24,055          35,100            --
                                                                                --------        --------        --------
        Net cash used in investing activities ...........................        (20,357)         (9,559)        (21,073)
                                                                                --------        --------        --------

Cash flows from financing activities:
  Payments on long-term debt ............................................         (6,881)         (6,835)        (11,361)
  Payment of dividends ..................................................        (14,000)         (7,000)         (7,000)
                                                                                --------        --------        --------
        Net cash used in financing activities ...........................        (20,881)        (13,835)        (18,361)
                                                                                --------        --------        --------
Net increase (decrease) in cash and 
  cash equivalents.......................................................         (1,035)          3,296           3,107
Cash and cash equivalents:
  Beginning of the year .................................................         22,313          19,017          15,910
                                                                                --------        --------        --------
  End of the year .......................................................       $ 21,278        $ 22,313        $ 19,017
                                                                                ========        ========        ========

Supplemental cash flow disclosures: Cash paid during the year for:
    Interest ............................................................       $  1,115        $  1,528        $  2,082
                                                                                ========        ========        ========
    Income taxes ........................................................       $ 12,622        $ 11,616        $  7,831
                                                                                ========        ========        ========
Supplemental schedule of noncash investing and financing activities:
  Acquisition of property, plant and equipment
    included in other long-term liabilities (Note 9) ....................       $   --          $  2,500        $   --
                                                                                ========        ========        ========
</TABLE>
    The accompanying notes are an integral part of the financial statements.

                                      -51-
<PAGE>
                             WHEELING-NISSHIN, INC.

                          NOTES TO FINANCIAL STATEMENTS
                             (DOLLARS IN THOUSANDS)
                                     -------


1.          DESCRIPTION OF BUSINESS:

            Wheeling-Nisshin,  Inc. (the  Company) is engaged in the  production
            and  marketing of  galvanized  and  aluminized  steel  products at a
            manufacturing facility in Follansbee, West Virginia. Principally all
            of  the  Company's  sales  are  to  ten  trading  companies  located
            primarily  in the United  States.  At  December  31,  1998,  Nisshin
            Holding  Incorporated,  a  wholly-owned  subsidiary of Nisshin Steel
            Co.,   Ltd.,   (Nisshin),   and   Wheeling-Pittsburgh    Corporation
            (Wheeling-Pittsburgh), a wholly owned subsidiary of WHX Corporation,
            owned  64.3%  and  35.7%  of the  outstanding  common  stock  of the
            Company, respectively.


2.          SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

                  USE OF ESTIMATES:

                  The  preparation  of financial  statements in conformity  with
                  generally accepted  accounting  principles requires management
                  to make  estimates  and  assumptions  that affect the reported
                  amounts  of  assets  and  liabilities  and the  disclosure  of
                  contingent assets and liabilities at the date of the financial
                  statements.  Estimates  also  affect the  reported  amounts of
                  revenues  and expenses  during the  reporting  period.  Actual
                  results could differ from those estimates.

                  CASH AND CASH EQUIVALENTS:

                  Cash and cash equivalents consist of general cash accounts and
                  highly liquid debt instruments with maturities of three months
                  or less when  purchased.  Substantially  all of the  Company's
                  cash and cash  equivalents  are  maintained  at one  financial
                  institution.  No collateral  or other  security is provided on
                  these  deposits,  other than $100 of  deposits  insured by the
                  Federal Deposit Insurance Corporation.

                  INVESTMENTS:

                  Effective  January 1, 1996, the Company  adopted  Statement of
                  Financial Accounting Standards (SFAS) No. 115, "Accounting for
                  Certain  Investments  in Debt  and  Equity  Securities."  This
                  statement  requires that  securities be classified as trading,
                  held-to-maturity,   or   available-for-sale.   The   Company's
                  investments,  which  consist of  certificates  of deposit  and
                  commercial paper, are classified as  held-to-maturity  and are
                  recorded at cost. The  certificates of deposit  amounted to $0
                  and $28,500 at December 31, 1998 and 1997,  respectively,  and
                  are maintained at one financial institution.  Commercial paper
                  amounted  to $48,659  and $0 at  December  31,  1998 and 1997,
                  respectively.

                  INVENTORIES:

                  Inventories are stated at the lower of cost or market. Cost is
                  determined by the last-in, first-out (LIFO) method.



                                      -52-
<PAGE>
                    NOTES TO FINANCIAL STATEMENTS, Continued
                             (Dollars in thousands)
                                     -------


2.          SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued:

                  PROPERTY, PLANT AND EQUIPMENT:

                  Property,   plant  and   equipment  is  stated  at  cost  less
                  accumulated depreciation and amortization.

                  Major  renewals and  improvements  are charged to the property
                  accounts, while replacements, maintenance and repairs which do
                  not  improve  or extend  the  useful  lives of the  respective
                  assets  are  expensed.   Upon  disposition  or  retirement  of
                  property,  plant  and  equipment,  the  cost  and the  related
                  accumulated  depreciation or amortization are removed from the
                  accounts.  Gains or  losses on sales  are  reflected  in other
                  income.

                  Depreciation   and   amortization   are  provided   using  the
                  straight-line  method over the  estimated  useful lives of the
                  assets.

                  DEBT ISSUANCE COSTS:

                  Debt issuance costs  associated with long-term debt secured to
                  finance   the   construction   of   the   Company's   original
                  manufacturing  facility  and the second  production  line were
                  capitalized  and  are  being  amortized  using  the  effective
                  interest method over the term of the related debt.

                  INCOME TAXES:

                  The Company uses SFAS No. 109,  "Accounting for Income Taxes",
                  to  recognize  deferred  tax  liabilities  and  assets for the
                  difference  between the financial  statement  carrying amounts
                  and the tax basis of assets and liabilities  using enacted tax
                  rates in  effect in the  years in which  the  differences  are
                  expected to reverse. Valuation allowances are established when
                  necessary to reduce deferred tax assets to the amount expected
                  to be realized.

                  EARNINGS PER SHARE:

                  In 1997,  the  Company  adopted  SFAS No. 128,  "Earnings  per
                  Share." This  statement  requires the  disclosure of basic and
                  diluted  earnings per share and revises the method required to
                  calculate these amounts.

                  Earnings per share is calculated by dividing net income by the
                  weighted average number of shares of common stock  outstanding
                  during each period.


                                      -53-
<PAGE>
                    NOTES TO FINANCIAL STATEMENTS, Continued
                             (Dollars in thousands)
                                     -------


3.          Inventories

            Inventories consist of the following at December 31:

                                                        1998             1997
                                                      -------          -------

Raw materials ............................            $ 7,576          $ 5,335
Finished goods ...........................              5,711           10,115
                                                      -------          -------
                                                      $13,287          $15,450
                                                      -------          -------
LIFO reserve .............................                510            1,343
                                                      -------          -------
                                                      $13,797          $16,793
                                                      =======          =======

            During  1998,  the Company  revised its LIFO  valuation  approach to
valuing  inventories  at  December  31,  1998.  The effect of this change was to
decrease  inventories and income before income taxes by approximately $1,593 and
net income by approximately $1,009. Additionally, during 1998, certain inventory
quantities  were reduced  resulting in a liquidation  of LIFO  inventories,  the
effect of which decreased net income by approximately $102.


4.  Property, Plant and Equipment

            Property,  plant and equipment consists of the following at December
            31:

                                                           1998           1997
                                                        ---------     ---------

Buildings ..........................................    $  34,674     $  34,665
Land improvements ..................................        3,097         3,097
Machinery and equipment ............................      165,569       164,893
Office equipment ...................................        3,262         3,725
                                                        ---------     ---------
                                                          206,602       206,380
Less accumulated depreciation and amortization .....      (95,816)      (82,625)
                                                        ---------     ---------
                                                          110,786       123,755
Land ...............................................        1,002         1,032
                                                        ---------     ---------
                                                        $ 111,788     $ 124,787
                                                        =========     =========

            Depreciation expense was $13,191, $12,846 and $12,715 in 1998, 1997,
and 1996, respectively.



                                      -54-
<PAGE>
                    NOTES TO FINANCIAL STATEMENTS, Continued
                             (Dollars in thousands)
                                     -------


5.  Long-Term Debt

            Long-term debt consists of the following at December 31:

                                                          1998          1997
                                                          ----          ----

Industrial revenue bonds for the second production line
  accruing interest at .625% over the LIBOR rate, as
  adjusted for periods ranging from three months to
  one year, as elected by the Company. The interest
  rate on the bonds was 6.66% at December 31, 1998
  and 6.53% at December 31, 1997. The bonds are
  payable in 17 equal semi-annual installments of
  $3,353 plus interest through March 2000.............. $ 11,529      $  18,235

West Virginia Economic Development Authority
  (WVEDA) loan accruing interest at 4%, payable in
  monthly installments of $2 including interest
  through January 2001 was repaid in 1998..............       --            67

Capital lease obligations accruing interest at rates
  ranging from 10% to 13.8%, payable in monthly
  installments through January 2000....................       70            178
                                                         -------       --------
                                                          11,599         18,480
Less current portion...................................    6,775          6,835
                                                         -------       --------
                                                         $ 4,824       $ 11,645
                                                         =======       ========

            The industrial revenue bonds are collateralized by substantially all
property,  plant and equipment and are guaranteed by Nisshin.  In addition,  the
industrial  revenue  bonds  provide that  dividends  may not be declared or paid
without the prior written consent of the lender.  Such approval was obtained for
the dividends paid in years 1998, 1997 and 1996.

            The annual  maturities  on all  long-term  debt for each of the five
years ending December 31 are: $6,775 in 1999; $4,824 in 2000; and $0 thereafter.



                                      -55-
<PAGE>
                    NOTES TO FINANCIAL STATEMENTS, Continued
                             (Dollars in thousands)
                                     -------


6.  Income Taxes

            The  provision  for income  taxes for the years  ended  December  31
consist of:

                                             1998           1997           1996
                                           -------        -------        -------
Current:
  U.S. Federal ....................        $10,543        $ 7,771        $ 7,366
  State ...........................            709            523            414
Deferred ..........................            697          1,141          5,330
                                           -------        -------        -------
                                           $11,949        $ 9,435        $13,110
                                           =======        =======        =======


            Reconciliation  of the federal statutory and effective tax rates for
1998, 1997 and 1996 are as follows:

                                                 1998         1997         1996
                                                 ----         ----         ----

Federal statutory rate ..................        35.0%        35.0%        35.0%
State income taxes ......................         1.6          1.5          1.2
Other, net ..............................         0.1          0.5          1.6
                                                 ----         ----         ---- 
                                                 36.7%        37.0%        37.8%
                                                 ====         ====         ==== 

            The  deferred  tax assets and  liabilities  recorded  on the balance
sheets as of December 31 are as follows:

                                                            1998           1997
                                                          -------        -------

Deferred tax assets:
  Accrued expenses ...............................        $ 1,143        $ 1,120
  Other ..........................................          1,511          1,222
                                                          -------        -------
                                                            2,654          2,342
                                                          -------        -------

Deferred tax liabilities:
  Depreciation and amortization ..................         22,729         23,781
  Other ..........................................          3,542          1,481
                                                          -------        -------
                                                           26,271         25,262
                                                          -------        -------
                                                          $23,617        $22,920
                                                          =======        =======

            The Company has  received  two separate tax credits for new business
investment and jobs expansion  (Supercredits) in West Virginia. The Supercredits
may only be applied to offset the West Virginia  income tax liability  generated
by  the  specific  business   expansion  that  created  the  credit.  The  first
Supercredit  was granted in 1988 and expired in 1997.  However,  the Company has
approximately $2,500 of credit  carryforwards  attributed to the 1988 investment
that may be used to offset the company's West Virginia  income tax liability for
the three taxable years ended 2000.

            The second  Supercredit  granted in 1993 can be used to offset up to
$5,958 annually of West Virginia income tax  attributable to the 1993 investment
through the 2002 tax year. A portion on any unused credit may be carried forward
for three taxable years thereafter.

            A valuation  allowance for the entire amount of the Supercredits has
been recognized in the accompanying  financial statements.  Accordingly,  as the
Supercredits  are utilized,  a benefit is recognized  through a reduction of the
current  state  income tax  provision.  Such benefit  amounted to  approximately
$1,120 in 1998, $876 in 1997 and $1,058 in 1996.

                                      -56-
<PAGE>
                    NOTES TO FINANCIAL STATEMENTS, Continued
                             (Dollars in thousands)
                                     -------


7.  Employee Benefit Plans

            RETIREMENT PLAN:

            The Company has a noncontributory,  defined  contribution plan which
            covers   eligible   employees.   The  plan   provides   for  Company
            contributions  ranging  from  2% to 6% of the  participant's  annual
            compensation  based  on  their  years  of  service.   The  Company's
            contribution  to the plan was $490 in 1998, $415 in 1997 and $336 in
            1996.

            PROFIT-SHARING PLAN:

            The  Company has a  nonqualified  profit-sharing  plan for  eligible
            employees,  providing for cash  distributions to the participants in
            years when income  before  income taxes is in excess of $500.  These
            contributions  are based on an  escalating  scale  from 5% to 15% of
            income  before  income  taxes.  The  profit-sharing  expense,  which
            includes the  profit-sharing  contribution  and the related employer
            payroll  taxes,  was  $6,290 in 1998,  $4,644 in 1997 and  $6,505 in
            1996.

            POSTRETIREMENT BENEFITS:

            In   December   1996,   the  Company   adopted  a  defined   benefit
            postretirement plan which covers eligible employees.  Generally, the
            plan calls for a stated  percentage of medical  expenses  reduced by
            deductibles and other coverages. The plan is currently unfunded. The
            postretirement  benefit  expense  was $68 for  1998,  1997 and 1996.
            Accrued postretirement  benefits were approximately $203 and $135 at
            December 31, 1998 and 1997, respectively.


8.          RELATED PARTY TRANSACTIONS:

            The Company has an agreement  with  Wheeling-Pittsburgh  under which
            the  Company  has  agreed to  purchase  a  specified  portion of its
            required raw materials  through the year 2013. The Company purchased
            $164,473,  $24,533 and  $161,380  of raw  materials  and  processing
            services   from   Wheeling-Pittsburgh   in  1998,   1997  and  1996,
            respectively. The amounts due Wheeling-Pittsburgh for such purchases
            are  included  in due to  affiliates  in  the  accompanying  balance
            sheets.

            The  Company  sells  products  to  Wheeling-Pittsburgh.  Such  sales
            totaled  $1,916,   $6,408,  and  $6,511  in  1998,  1997  and  1996,
            respectively, of which $228 and $880 remained unpaid at December 31,
            1998 and 1997,  respectively,  and are  included  in trade  accounts
            receivable  in the  accompanying  balance  sheets.  The Company also
            sells    products    to   Unimast,    Inc.,    an    affiliate    of
            Wheeling-Pittsburgh.  Such sales  totaled  $333,  $435 and $1,537 in
            1998,  1997 and  1996,  respectively,  of which $0 and $10  remained
            unpaid  at  December  31,  1998  and  1997,  respectively,  and were
            included in trade accounts  receivable in the  accompanying  balance
            sheets.



                                      -57-
<PAGE>
                    NOTES TO FINANCIAL STATEMENTS, Continued
                             (Dollars in thousands)
                                     -------



9.        LEGAL MATTERS:

          The  Company is a party to a dispute for final  settlement  of charges
          related to the construction of its second production line. The Company
          had claims asserted against it in the amount of  approximately  $6,900
          emerging  from  civil  actions  alleging  delays  on the  project.  In
          connection  with the dispute,  the Company filed a separate  claim for
          alleged  damages that it had sustained in the amount of  approximately
          $400.

          The claims were  litigated  in the Court of Common  Pleas of Allegheny
          County,  Pennsylvania,  in a jury trial, which commenced on January 5,
          1996.  A verdict in the amount of $6,700  plus  interest of $1,900 was
          entered against the Company on October 2, 1996. After the verdict, the
          plaintiffs  requested  the trial  court to award  counsel  fees in the
          amount of $2,422  against the  Company.  The motions for counsel  fees
          plus  interest  were  granted by the court to the  plaintiffs  in June
          1997.

          The Company filed appeals from the judgments to the Superior  Court of
          Pennsylvania in 1997. Post-judgment interest accrues during the appeal
          period.  Additionally,  the  Company  has posted a bond  approximating
          $12,000  that  will be held  by the  court  pending  the  appeals.  On
          December 31, 1998, a three-judge  panel of the Superior Court ruled in
          favor of the  Company's  appeals  vacating the October 2, 1996 adverse
          verdict and the award of counsel  fees and remanded the case for a new
          trial. The original  plaintiffs have requested the Superior Court hear
          reargument  of the case.  The Company has been  advised by its Special
          Counsel  that it has various  legal  bases for relief,  if a new trial
          were  to be  held;  however,  since  litigation  is  subject  to  many
          uncertainties,  the Company is presently unable to predict the outcome
          of this  matter.  In 1997,  the Company  recorded a  liability  in the
          amount of $2,500  related to these matters,  which was  capitalized in
          property,  plant and  equipment as cost  overruns in the  accompanying
          balance sheets.  There is at least a reasonable  possibility  that the
          ultimate resolution of these matters may have a material effect on the
          Company's  results  of  operations  or cash flows in the year of final
          determination.  Any portion of the ultimate  resolution  for interest,
          penalties and counsel fees will be charged to results of operations.


10.       FAIR VALUE OF FINANCIAL INSTRUMENTS:

          The estimated fair values and the methods used to estimate those
          values are disclosed below:

          INVESTMENTS:

          The fair values of commercial  paper and  certificates of deposit were
          $48,844 and $28,890 at December 31, 1998 and 1997, respectively. These
          amounts were  determined  based on the  investment  cost plus interest
          receivable at December 31, 1998 and 1997.

          LONG-TERM DEBT:

          Based on borrowing rates currently available to the Company for bank
          loans with similar terms and maturities, fair value approximates the
          carrying value.



                                      -58-
<PAGE>
                                   SIGNATURES

            Pursuant  to the  requirements  of the  Securities  Act of 1933,  as
amended,  Wheeling-Pittsburgh  Corporation  has duly  caused  this  Registration
Statement  to be  signed  on its  behalf  by  the  undersigned,  thereunto  duly
authorized, in the City of Wheeling, State of West Virginia on March 30, 1999.


                                   WHEELING-PITTSBURGH CORPORATION


                                   By:/s/ James G. Bradley
                                      -------------------------
                                      James G. Bradley
                                      President and Chief Executive Officer


                                POWER OF ATTORNEY

            Each person whose signature  appears below  constitutes and appoints
James G.  Bradley and Paul J. Mooney,  and each of them singly,  as his true and
lawful  attorneys-in-fact  and  agents  with  full  power  of  substitution  and
resubstitution,  for  him,  and  his  name,  place  and  stead,  in any  and all
capacities to sign any and all amendments (including post-effective  amendments)
and supplements to this Registration  Statement,  and to file the same, with all
exhibits  thereto,  and all other  documents in connection  therewith,  with the
Securities and Exchange  Commission,  granting unto said  attorneys-in-fact  and
agents full power and  authority  to do and perform each and every act and thing
requisite  and  necessary to be done,  as full to all intents and purposes as he
might or could do in  person,  hereby  ratifying  and  confirming  all that said
attorneys-in-fact  and agents or their substitute or substitutes may lawfully do
or cause to be done by virtue hereof.

            Pursuant to the requirements of the Securities Act, as amended, this
Registration Statement has been signed by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.



Signatures                      Title                                Date
----------                      -----                                ----

/S/ James G. Bradley            President and Chief Executive     March 30, 1999
------------------------        Officer (Principal
James G. Bradley                Executive Officer)

/S/ Paul J. Mooney              Executive Vice President and      March 29, 1999
------------------------        Chief Financial Officer
Paul J. Mooney                  (Principal Accounting Officer)

/S/ Ronald Labow                Director                          March 30, 1999
----------------
Ronald LaBow

/S/ Robert A. Davidow           Director                          March 30, 1999
---------------------
Robert A. Davidow

/S/ Marvin L. Olshan            Director                          March 30, 1999
------------------------
Marvin L. Olshan


                                      -59-