UNITED STATES
                 	SECURITIES AND EXCHANGE COMMISSION
                       	Washington, D.C. 20549

                            	FORM 10-K
(Mark One)
[X]		ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934

	For the fiscal year ended June 30, 1998

	OR

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

                        	Commission File No. 1-10281

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

     Delaware	                        51-0286862
(State or other jurisdiction of	   (I.R.S. Employer
incorporation or organization)     	Identification No.)

  	839 Route 13 South, Cortland, New York  13045
	(Address of principal executive offices)(Zip Code)
	  (607) 753-6011
	(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:	None
Securities registered pursuant to Section 12(g) of the Act: 
Common Stock, $.001 par value

Indicate by check mark whether the registrant (1) has filed all reports 
required to be filed by Section 13 or 15(d) of the Securities Exchange 
Act of 1934 during the preceding 12 months (or for such shorter period 
that the registrant was required to file such reports), and (2) has been 
subject to such filing requirements for the past 90 days.  Yes X No   
Indicate by check mark if disclosure of delinquent filers pursuant to 
Item 405 of Regulation S-K is not contained herein, and will not be 
contained, to the best of registrant's knowledge, in definitive proxy 
or information statements incorporated by reference in Part III of this 
Form 10-K or any amendment to this Form 10-K. [ ]
The aggregate market value of the voting stock and 
non-voting common equity of the registrant held by non-affiliates 
of the registrant as of September 1, 1998: $7,631,894 (Such amount 
has been computed as described in "Market for Registrant's Common 
Equity and Related Stockholder Matters.")

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

Indicate by check mark whether the registrant has filed all documents 
and reports required to be filed by Section 12, 13 or 15(d) of the 
Securities Exchange Act of 1934 subsequent to the distribution of 
securities under a plan confirmed by a court.   
Yes X  No   

Number of shares of Common Stock outstanding as of September 1, 1998: 2,983,372.
	Documents Incorporated by Reference
Document	Part of Form 10-K
Portions of the Proxy Statement relating to registrant's	Part III
1998 Annual Meeting of Stockholders, to be filed with the
Commission within 120 days after the close of the 
registrant's fiscal year
	



TABLE OF CONTENTS


PART I	                                        3
Item 1. Business	                              3
General	                                       3
Recent Events	                                 3
Restructuring and Bankruptcy Reorganization	   4
History of the Business	                       5
Products	                                      6
Marketing, Sales and Distribution	             7
Service	                                       8
Seasonality	                                   8
Manufacturing Operations	                      8
Competition	                                   9
Patents, Trademarks and Licenses	              9
Employees	                                     9
Research and Development	                      9
 
Item 2. Properties	                           10

Item 3. Legal Proceedings	                    10

Item 4. Submission of Matters to a Vote 
        of Security Holders	                  11

Executive Officers of the Registrant	         11

PART II	                                      13
Item 5. Market for Registrant's Common 
        Equity and Related Stockholder 
        Matters	                              13

Item 6. Selected Financial Data	              14

Item 7. Management's Discussion and 
        Analysis of Results of Operations
        and Financial Condition	              16

Item 8. Financial Statements and 
        Supplementary Data	                   20

Item 9. Changes in and Disagreements with 
        Accountants on Accounting
        and Financial Disclosure	             20

PART III	                                     20
Item 10. Directors and Executive Officers 
         of the Registrant	                   20

Item 11. Executive Compensation	              20

Item 12. Security Ownership of Certain 
         Beneficial Owners and Management	    20

Item 13. Certain Relationships and 
         Related Transactions	                20

PART IV	                                      21
Item 14. Exhibits, Financial Statement 
         Schedules, and Reports on Form 8-K	  21

Index to Consolidated Financial Statements 
and Financial Statement Schedule	             25



	PART I

Item 1. Business
	The Company

General

Smith Corona Corporation (the "Company") is dedicated to 
providing productivity and communication solutions to the small 
office and home office markets through new and emerging 
technology products, in addition to its traditional portable 
electronic typewriters and related accessories and supplies.

The Company was incorporated in 1985 in the State of Delaware. 
Prior to 1986, the businesses of the Company were operated by 
SCM Corporation ("SCM") which was acquired by Hanson PLC 
("Hanson") in March 1986.  At the time it was acquired, SCM 
consisted of a number of businesses, including the manufacture 
and sale of typewriters, personal word processors and supplies 
and accessories and businesses in the chemical, paper and food 
industries.  On August 3, 1989, the Company completed a 
registered public offering of 14,750,000 shares of common 
stock, par value $.01 per share (the "Old Common Stock").  On 
July 5, 1995, the Company filed for relief under Chapter 11 of 
the United States Bankruptcy Code (the "Bankruptcy Code").  
Upon the Company's emergence from bankruptcy proceedings on 
February 28, 1997, the Old Common Stock was canceled, 
registered holders of the Old Common Stock as of August 15, 
1996 received warrants to purchase one share of common stock, 
par value $.001 per share (the "Common Stock"), for each 20 
shares of Old Common Stock and certain of the Company's 
creditors received Common Stock.  (See "Restructuring and 
Bankruptcy Reorganization" for further discussion of the 
bankruptcy proceedings.)

Recent Events

On July 17, 1998 Peter N. Parts, Chairman of the Board of 
Directors assumed the post of President and Chief Executive 
Officer.  Peter Parts replaced W. Michael Driscoll, who retired 
as the Company's President and Chief Executive Officer.

On July 22, 1998 Ronald F. Stengel resigned as Director of the 
Company. Mr. Stengel stepped down as Chairman of the Board of 
Directors in May 1998 due to constraints imposed by his current 
business commitments.

On August 3, 1998 J. Thomas Malatesta joined the Company as 
Vice President-New Market Development.  Mr. Malatesta will 
explore synergistic opportunities in related markets and seek 
out new channels of distribution for new and existing products. 


Effective October 1, 1998, Martin D. Wilson will serve as the 
Company's Senior Vice President, Chief Financial Officer and 
Assistant Secretary. Mr. Wilson, who previously served as Vice 
President/Controller will replace John A. Piontkowski, who 
resigned as the Company's Executive Vice President, Chief 
Financial Officer and Assistant Secretary.


Effective September 28, 1998, the Company's Board of Directors 
approved a restructuring program which includes: i.) the 
elimination of approximately 130 positions primarily located at 
the Company's Corporate Headquarters in Cortland, New York, 
ii.) the sale or lease of the building in Cortland, New York, 
iii.) relocation of the Corporate Headquarters to more 
efficient facilities.  The Company expects the restructuring 
program to be completed by June 30, 1999.  As a result of these 
actions, the Company will record a first quarter pre-tax 
charge, principally for severance payments, of approximately 
$1.2 million.

Restructuring and Bankruptcy Reorganization

On May 8, 1995 the Company announced a major restructuring plan 
whereby (i) the Company?s typewriter manufacturing would be 
relocated from its Singapore and Batam Island, Indonesia 
facilities to its Mexico facility and (ii) approximately 180 
support positions within research and development, finance, 
service, distribution, selling and marketing areas in both its 
Cortland, New York and New Canaan, Connecticut locations would 
be eliminated (the "Restructuring").

The Company had experienced sales declines and operating 
losses, had extended payment of obligations owed to its trade 
vendors, and needed additional financing to meet operating 
requirements and fund the Restructuring.  As a result, on July 
5, 1995 (the "Petition Date"), the Company filed a voluntary 
petition for relief under Chapter 11 of the United States 
Bankruptcy Code in the United States Bankruptcy Court for the 
District of Delaware (the "Bankruptcy Court").  From July 5, 
1995 to February 28, 1997 the Company operated as a debtor-in-
possession.  On August 18, 1995, SCM Office Supplies, Inc., SCC 
LI Corporation (formerly known as Histacount Corporation) and 
Hulse Manufacturing Company, all wholly-owned nonoperating 
subsidiaries of the Company (collectively, the "Nonoperating 
Subsidiaries"), filed Chapter 11 petitions.  On October 31, 
1996, Smith Corona Overseas Holdings, Inc., SCM Inter-American 
Corporation and SCM (United Kingdom) Limited, all wholly-owned 
domestic subsidiaries (the "Wholly-Owned Domestic 
Subsidiaries"), also filed Chapter 11 petitions.  (The 
petitions of the Company, the Nonoperating Subsidiaries and the 
Wholly-Owned Domestic Subsidiaries are referred to herein 
collectively as the ?Bankruptcy Proceedings?).  The primary 
purpose of the October 31, 1996 filings, which had no effect on 
operations, was to better protect corporate assets during the 
reorganization period.  The Bankruptcy Proceedings primarily 
related to all U.S. assets and operations and did not involve 
the Company's international subsidiaries.  

On September 9, 1996, the Company filed its Third Amended 
Second Joint Plan of Reorganization (the "Plan of 
Reorganization") and Third Amended Second Disclosure Statement 
with the Bankruptcy Court, which Disclosure Statement was 
approved by the Bankruptcy Court for solicitation of creditor 
acceptance of the Plan of Reorganization.  On January 27, 1997 
the Bankruptcy Court entered an order confirming the Company's 
Plan of Reorganization (the "Confirmation Order").  The 
Confirmation Order was subject to satisfaction of certain 
conditions precedent to the effective date.  The Company 
satisfied the conditions and emerged from the Bankruptcy 
Proceedings on February 28, 1997 (the "Effective Date").

Under the Plan of Reorganization, all allowed general unsecured 
claims are being satisfied through the distribution to holders 
of such claims of (i) the unsecured class cash of approximately 
$11.3 million (less any amounts paid to holders of allowed 
convenience class claims discussed below), and (ii) 85 percent 
of the Common Stock (determined on a fully diluted basis, not 
including the effect of the exercise of any of the below 
described warrants). Each holder of an allowed general 
unsecured claim receives one share of the Common Stock for each 
ten dollars in allowed claim value. All allowed claims senior 
to allowed general unsecured claims will be satisfied by the 
payment in full in cash or notes (as provided by the Bankruptcy 
Code) or the assumption of all such claims.  The distributions 
to holders of allowed general unsecured claims and claims 
senior to such claims commenced in March 1997.  In addition, 
allowed convenience class claims (general unsecured claims of 
one thousand five hundred dollars or less) have received 
payment in cash in an amount equal to 60 percent of the amount 
of such claims.  Registered holders as of August 15, 1996, of 
the Old Common Stock received warrants to purchase one share of 
Common Stock for each twenty shares of Old Common Stock.

For further discussion of the Company's Restructuring and 
bankruptcy reorganization, see ?Business - Manufacturing 
Operations? and "Management's Discussion and Analysis of 
Results of Operations and Financial Condition."

History of the Business

The Company's typewriter and personal word processor business 
traces its origins back to the 1880's with the development of 
office typewriters.  The Company introduced the world's first 
portable electric typewriter in 1957 and, for the next decade, 
the Company had the only portable electric typewriter available 
in the marketplace.  In 1973, the Company introduced its 
revolutionary cartridge ribbon system, which is still used 
today. Beginning in 1979, the Company moved into electronics 
with major research and development efforts and, in 1981, 
introduced its first electronic typewriter product to the 
marketplace.

During the early 1980's, as the market shifted to electronic 
typewriters, Japanese manufacturers became a significant factor 
in the world marketplace.  In order to compete effectively, the 
Company implemented a major restructuring from 1984 to 1986 of 
its typewriter operations which resulted in substantially 
reduced manufacturing costs, a streamlined product line, a 50 
percent reduction in worldwide employment and the consolidation 
of certain of its United States operations.

In 1985, the Company developed and introduced one of the 
industry's first personal word processors, and, in 1989, the 
Company introduced the industry's first laptop personal word 
processor.

During the year ended June 30, 1995, the Company sold 
substantially all of the assets and liabilities of SCM Office 
Supplies, Inc. and Histacount Corporation (?Histacount?), 
respectively, two of its wholly-owned subsidiaries.  The 
results of operations and gain (loss) on sale related to SCM 
Office Supplies, Inc., and Histacount are presented as 
discontinued operations (see Item 6, Selected Financial Data). 
 Business operations of these two entities primarily consisted 
of the manufacture and distribution of office supplies and 
customized printed products, respectively.

From July 5, 1995 to February 28, 1997 the Company operated as 
a debtor-in-possession while in the Bankruptcy Proceedings.  On 
January 27, 1997 the Bankruptcy Court entered the Confirmation 
Order.  The Confirmation Order was subject to satisfaction of 
certain conditions precedent to the Effective Date.  The 
Company satisfied the conditions and emerged from the 
Bankruptcy Proceedings on the Effective Date.  During the 
Bankruptcy Proceedings, the Company confined expenditures to 
those manufacturing and operating costs that were necessary to 
preserve and maintain going-concern value.  In light of its 
financial condition, the Company also implemented a planned 
reduction in its workforce and a consolidation of its world 
headquarters from New Canaan, Connecticut to its facility in 
Cortland, New York.  Additionally, as part of the 
Restructuring, the Company relocated its typewriter 
manufacturing operations to its Mexico facility from facilities 
in Singapore and Batam Island, Indonesia.  See "Business - 
Restructuring and Bankruptcy Reorganization" and "Management's 
Discussion and Analysis of Results of Operations and Financial 
Condition."

On November 24, 1997, the Company sold its remaining 
manufacturing operations (the "Sale"). In addition, the Company 
entered into a long-term manufacturing agreement pursuant to 
which the purchaser will manufacture certain Smith Corona Brand 
name products, including typewriters and related supplies and 
accessories. The Sale included (i) certain property, plant and 
equipment used in the manufacturing operations, (ii) all the 
outstanding common stock of Smith Corona de Mexico, S.A. de 
C.V., the Company's Mexican subsidiary, and (iii) raw material 
and work-in-process inventories.  The Sale generated net 
proceeds of $14.9 million and resulted in a gain of $3.9 
million.

Products

Under the Plan of Reorganization, the Company's plans were to 
expand its product line, primarily by sourcing new products 
from outside manufacturers and that effort continues.  Such 
sourcing includes entering into strategic alliances with third 
parties in the United States, Europe and the Far East to 
provide products or services.  In that respect, the Company's 
efforts are focused on forging new and expanding existing 
alliances with companies that provide technologically advanced 
products for the small office and home office environment but 
presently do not have a substantial United States market 
penetration, and are intent on building or increasing market 
penetration by selling their products under the well-known 
"Smith Corona" name.  The Company intends to rely on its 
existing distribution network to become a leading vendor of 
technologically advanced products for the small office and home 
office. Additionally, the Company is exploring synergistic 
opportunities in related markets that will provide new and 
expand existing channels of distribution.  In the fall of 1997, 
newly sourced and manufactured products were available under 
the Smith Corona brand name. The product offerings include 
items in the telephony and plain paper inkjet facsimile product 
lines.  These new telephony products included a family of 
corded, as well as cordless phones incorporating the latest in 
900 MHz, analog, digital and spread spectrum technology.  In 
fiscal 1999 the Company intends to continue to introduce new 
products for home office and small office applications.  Some 
of the new products will be systems-oriented, and intended to 
increase personal productivity.  Further, the Company 
determined it would maintain its core business of distributing 
its current product line of typewriters and related supplies 
and accessories to satisfy continuing worldwide demand for 
these products. Due to substantial sales volume reductions, in 
June 1997 the Company ceased the manufacture of personal word 
processors; servicing and customer support of personal word 
processors, however, is continuing. 
 
As a result of the Company's sourcing strategy to use third-
party manufacturers the Company's results of operations are 
subject to risks of doing business abroad such as economic and 
political uncertainty.  Additionally, there can be no assurance 
that a significant disruption of a third-party manufacturer 
would not have a negative impact on the Company's business.  
The success of the Company depends, in part, on its ability to 
source, market and sell new products. 

The products or classes of similar products that accounted for 
10 percent or more of net sales of the Company in any of the 
Company's last three fiscal years were (i) portable and compact 
electronic typewriters, which accounted for 49.4 percent, 45.1 
percent and 38.1 percent of net sales in the fiscal years ended 
June 30, 1998, 1997 and 1996, respectively, (ii) personal word 
processors, which accounted for 11.5 percent and 21.8 percent 
of net sales in the fiscal years ended June 30, 1997 and 1996, 
respectively, and (iii) typewriters and personal word processor 
supplies and accessories, which accounted for 35.4 percent, 
36.5 percent and 29.4 percent of net sales in fiscal years 
ended June 30, 1998, 1997 and 1996, respectively.

	Marketing, Sales and Distribution

In the United States, the Company advertises, markets and 
promotes its products through television and national print 
media, both consumer and trade.  Advertisements focus on the 
key features and benefits of the various products.  During the 
Bankruptcy Proceedings advertising expenditures consisted of 
limited trade and print advertising.  In the fiscal year ended 
June 30, 1998 the Company significantly increased levels of 
advertising to support introduction and sell-through of new 
products.  The Company also supports local advertising 
campaigns of its customers, if the campaigns comply with 
certain standards set by the Company.

The Company makes available for use, at retail store locations, 
various point-of-sale materials and other in-store visual 
supports.  In addition, the Company provides training support 
for its customers' sales staffs conducted by the Company's 
marketing support representatives.

In the United States, the Company distributes its products 
through outlets in all major channels of distribution, 
including (i) national retail chain stores, such as Wal-Mart; 
(ii) warehouse clubs, such as Sam's and BJ Wholesale; (iii) 
catalog merchandisers, such as Service Merchandise; (iv) 
national and regional office supply wholesalers such as United 
Stationers and S.P. Richards; (v) office superstores, such as 
Office Depot, Inc., OfficeMax and Staples; (vi) office 
equipment dealers; (vii) regional discount stores, such as 
FedCo; and (viii) United States military exchanges.  The 
Company does not enter into long-term contracts with its 
customers and there can therefore be no assurance that the 
Company will continue to receive sales revenues from any 
particular source.

Internationally, the Company distributes its products in 
Canada, European Community countries, Latin America, South 
America, Caribbean markets and other international markets. The 
channels of distribution in the international markets are 
similar to those in the United States market and include 
national retail chains, catalog merchandisers, department 
stores, office equipment dealers, discount stores, stationers 
and direct mail accounts.  The Company relies primarily on 
distributors for sales of its products in international 
markets.  As a result, the Company's results of operations are 
subject to the risks of doing business abroad, including 
currency exchange rate fluctuations, nationalization, 
expropriation, limits on repatriation of funds and other risks 
associated with economic or political uncertainty in countries 
in which significant sales are made. See the footnotes to the 
Consolidated Financial Statements in this Form 10-K Annual 
Report for information regarding the Company's business 
operations within and outside the United States.

Payment terms granted to customers reflect general practices in 
the industry.  Terms vary with product and competitive 
conditions, but generally require payment within 30 to 90 days. 
 Historically, bad debts have been insignificant.  Wal-Mart 
Stores, Inc., one of the Company's largest customers, was 
responsible for 29.7 percent of consolidated net sales in the 
year ended June 30, 1998.  Wal-Mart Stores, Inc. was the only 
customer responsible for more than 10 percent of net sales.  
All of the Company's sales are made to customers who are not 
affiliated with the Company.

Service

The Company's products are serviced in the United States by a 
Smith Corona factory service center located in Cortland, New 
York as well as at independent service stations domestically 
and internationally.  The service center and stations employ 
trained technicians, maintain parts inventory and perform 
warranty and other repairs.

Seasonality

The Company believes that its business in the aggregate is not 
seasonal, although certain of its products sell more heavily in 
gift-giving seasons such as the winter holidays and school 
graduation periods.

Manufacturing Operations

On November 24, 1997 the Company completed the Sale of its 
manufacturing operations.  In addition, the Company entered 
into a long-term manufacturing agreement pursuant to which the 
purchaser will manufacture certain Smith Corona brand name 
products, including typewriters and related supplies and 
accessories.  

Prior to the Sale, the Company's sole manufacturing operation 
was located in Mexico. As a result of the Restructuring, the 
Company ceased production in Singapore and Batam Island in mid-
November 1995, and completed the process of relocating certain 
equipment to Mexico where typewriter production commenced in 
December 1995.  


Competition

The portable and compact electronic typewriter business is 
highly competitive.   The Company faces competition from 
Japanese and various other companies, including, among others, 
Brother International Corporation, which manufacture portable 
and compact electronic typewriters. Some of the competitors may 
have greater financial resources than the Company.  As the 
portable and compact electronic typewriter market has continued 
to mature, competition has increased.  To remain competitive, 
the Company has reduced the prices of its typewriters in line 
with market pricing.  Telephony products compete against brands 
such as Lucent, Sony, Uniden and Panasonic.  Facsimile products 
compete against brands such as Brother, Canon and Sharp. The 
telephony and facsimile markets are growing and are much larger
 than those of the mature and shrinking markets for 
typewriters, and supplies and accessories.  In the fourth 
quarter of the Company's 1998 fiscal year competitors began 
reducing market prices for the low-end telephony and facsimile 
products.  These sharp price declines have resulted in the 
Company having to reduce its low-end telephony and facsimile 
product pricing as well as take charges for new product 
inventory writedowns.  (See "Management's Discussion and 
Analysis of Results of Operations and Financial Conditions" for 
further discussion on inventory writedowns.)

Patents, Trademarks and Licenses

The Company owns or licenses a number of patents and patent 
applications which are valuable to its typewriters and supplies 
and accessories business.  The Company is the owner of a number 
of trademarks and U.S. and foreign registrations thereof, the 
most important of which is the trademark, "Smith Corona".

Employees

As of June 30, 1998, the Company employed approximately 225 
people.  Management considers its employee relations to be 
good.  

Research and Development

The Company's expenditures for research and development 
activities were approximately $4.8 million,$1.9 million and 
$2.0 million for the fiscal years ended June 30, 1998, 1997 and 
1996, respectively.  Research and development expenses were 
concentrated primarily in the development of new products for 
the year ended June 30, 1998 and in improving product 
manufacturing and integration of products/technology to the 
Company's product lines for the years ended June 30, 1997 and 
1996. 


Item 2. Properties

The Company utilizes approximately 527,000 square feet of space, 
of which about 499,000 square feet are located in the United 
States and about 28,000 square feet are located primarily in 
Canada, the Netherlands and the United Kingdom. Of the total 
square footage, approximately 422,000 square feet are owned and 
the remaining 105,000 square feet are leased. Additionally, the 
Company subleases approximately 12,600 square feet of the 
77,000 square feet of warehousing and office space in the San 
Diego facility.  Information with respect to the principal 
facilities used by the Company is set forth below:

                                               Approximate
                                               Square      Owned/
Location               Primary Use             Footage     Leased
Cortland, NY......  Headquarters/
                    Warehousing/Service        422,000     Owned
San Diego, CA.....  Warehousing/Office          77,000     Leased
                                               499,000
All other locations Warehousing/
                    Sales/Service               28,000     Leased

                      Total.............       527,000


Item 3. Legal Proceedings  

Description of Legal Proceedings

Certain aspects of the Company's past handling and/or disposal 
of hazardous substances have been the subject of investigation 
by federal and state regulatory authorities, or have been the 
subject of lawsuits filed by such authorities or by private 
parties.  At June 30, 1998 and June 30, 1997, the Company had 
recorded liabilities of approximately $1.9 million and $3.0 
million, respectively, related to environmental matters.  
Because of the uncertainties associated with assessing 
environmental matters, the related ultimate liabilities are not 
presently determinable. However, based on facts presently 
known, management does not believe that these investigations, 
if resolved adversely to the Company, would individually or in 
the aggregate have a material adverse effect on the Company's 
financial position or results of operations.

The Company was the owner and operator of manufacturing 
facilities in Groton, New York (the "Groton Site") and 
Cortlandville, New York (the "Cortlandville Site" and together, 
the "Owner/Operator Sites").  The Company's liability, if any, 
at the Owner/Operator Sites stems from groundwater 
contamination at the Cortlandville Site and soil contamination 
at the Groton Site. The remediation program at the 
Cortlandville site currently consists of round-the-clock 
pumping and filtering.  The soil venting with a soil 
infiltration injection system for the Groton Site is now 
reduced to periodic soil and water sampling. A decommissioning 
plan for the Groton Site has been approved and decommissioning 
activities have commenced.  To the Company's knowledge, the 
only future costs that will be associated with remediation of 
those sites are for operation, maintenance, monitoring, 
shutdown, and post-shutdown of the systems.  The Company 
believes that it has set aside adequate reserves for the 
payment of expenses for the ongoing remediation programs at the 
Groton and Cortlandville Sites.   

The Company is also a defendant or plaintiff in various other 
legal actions that have arisen in the ordinary course of its 
business.  It is the opinion of management that the ultimate 
resolution of these matters and the environmental matters 
discussed above will not have a material adverse effect on the 
Company's financial position or results of operation.

Item 4. Submission of Matters to a Vote of Security Holders

None.

Executive Officers of the Registrant

The officers of the Company are elected by and serve at the 
direction of the Board of Directors.  The executive officers of 
the Company and their respective positions, ages at September 
14, 1998 and backgrounds are as follows:

Name						Position	Age

Peter N. Parts .............    Chairman of the Board,
                        						  President and Chief Executive 
                        						  Officer                  					   45
John A. Piontkowski ........    Executive Vice President,
                                Chief Financial Officer and
                                Assistant Secretary	             44
Michael J. Murray  .........    Executive Vice President, 
                                Sales and Marketing	             63
Michael W. Chernago.........    Vice President/Operations	       52
Gary J. Lynch   ............    Vice President/Treasurer	        48
J. Thomas Malatesta.........    Vice President/New Market 
                                Development 	                    55
Martin D. Wilson ...........    Vice President/Controller	       38
John W. Wolff   ............    Vice President/Product
                                Development	                     46


Mr. Parts, age 45, was elected Chairman of the Board of the 
Company on May 23, 1998 and President and Chief Executive 
Officer on July 17, 1998.  He has served as President and Chief 
Executive Officer of Peter Parts Electronics, Inc., a North 
American sales group for electronic manufactures from Asia and 
Europe, since 1986.  Mr. Parts has been a director of the 
Company since February 28, 1997.   

Mr. Piontkowski, age 44, was named Executive Vice President and 
Chief Financial Officer on May 7, 1997.  From June 21, 1995 to 
May 15, 1996, he also held the office of Treasurer.  He has 
served as an Assistant Secretary of the Company since July 1, 
Mr. Piontkowski served as Senior Vice President and 
Chief Financial Officer from June 1995 to May 1997, as Vice 
President/Finance and Controller from March 1995 to June 1995 
and as Vice President/Controller of the Company from July 1993 
to March 1995.  Mr. Piontkowski served as Director of Accounting 
and Financial Reporting of the Company from December 1991 to July 1993.


Mr. Murray, age 63, has served as Executive Vice President of 
Sales and Marketing for the Company since March 1, 1998.  Mr. 
Murray served as Vice President for Worldwide Sales, Marketing 
and Technical Service operations of Harris/RF Communications 
Company, a manufacturer of military radios from January 1993 to 
January 1995.  Mr. Murray served as Regional Business General 
Manager and Vice President of the Office Imaging Division of 
Eastman Kodak Company until his retirement in January 1993.  
Mr. Murray is currently a director of Photikon Corporation.  
Mr. Murray has been a director of the Company since February 
28, 1997. 

Mr. Chernago was named Vice President/Operations on January 26, 
From July 1994 to January 1996, Mr. Chernago served as 
Vice President Product Assurance and Vice President/Operations 
of the Company.  Mr. Chernago served as Director, Manufacturing 
Engineering from September 1989 to July 1994.  Mr. Chernago has 
held various other positions within the Company since 1973.

Mr. Lynch has served as Vice President/Treasurer of the Company 
since May 15, 1996.  From April 1995 to May 1996, Mr. Lynch 
served as Director of Treasury Services.  Mr. Lynch served as 
Director of Budgets and Financial Analysis from April 1987 to 
April 1995.  Mr. Lynch has held various other positions within 
the Company since 1978. 

Mr. Malatesta was named Vice President/New Market Development 
on August 3, 1998.  Prior to August 1998 Mr. Malatesta was 
President of Global Marketing Services Incorporated, a 
strategic marketing consulting firm serving multinational 
company's.  In August 1994, Mr. Malatesta filed for personal 
bankruptcy under Chapter 11 of the United States Bankruptcy 
Code. The filing was converted to Chapter 7 and upon appeal was 
dismissed.     

Mr. Wilson was named Vice President/Controller of the Company 
on May 15, 1996.  Prior to that time, he served as Controller 
from July 1995 to May 1996, Assistant Controller from April 
1995 to July 1995, and as Director/Accounting and Financial 
Reporting from January 1994 to April 1995.  Prior to joining 
the Company, he served as Financial Reporting Manager for 
Fisher-Price Inc., an international manufacturer, marketer and 
distributor of infant and preschool toys and juvenile products, 
from November 1991 through December 1993.

Mr. Wolff has served as Vice President/Product Development 
since January 20, 1997.  He served as Director of Materials 
from February 1996 to January 1997, Director of Procurement and 
Distribution from December 1995 to February 1996, Director of 
Division Procurement and Cortland Materials from November 1994 
to December 1995, Director of Engineering from August 1993 to 
November 1994 and Director of Engineering - Singapore from 
January 1989 to August 1993.  Mr. Wolff has held various other 
positions within the Company since 1981.



PART II

Item 5. Market for Registrant's Common Equity and Related
   Stockholder Matters

The Common Stock (NASDAQ symbol: SCCO) commenced trading on the 
Nasdaq SmallCap Market on May 29, 1997.  From February 28, 1997 
to May 29, 1997, the Common Stock was traded on the over-the-
counter market.  Since the suspension of the trading on the New 
York Stock Exchange on May 30, 1996 until the Old Common Stock 
was canceled on February 28, 1997, there was no established 
public trading market for the Old Common Stock although the Old 
Common Stock continued to trade on the over-the-counter market. 
 

The following table sets forth the range of high and low bid 
prices of the Common Stock since February 28, 1997, the date of 
the first trade of the Common Stock.

                                    									Year Ended
                                   									June 30, 1998
                                   									High		    Low
First quarter  . . . . . . . . . .	. .	    $4.88	    $3.13

Second quarter . . . . . . . . . . . .		    8.13		    4.31

Third quarter  . . . . . . . . . . . .		    7.00		    4.38

Fourth quarter . . . . . . . . . . . .		    6.88		    5.00


                                             Year Ended
                                            June 30, 1997
                                            High		    Low

Third quarter (from February 28, 1997
 to March 31, 1997)(1) . . . . . . . . .   $6.00     $2.50
Fourth quarter (from April 1, 1997
 to May 29, 1997)(1) . . . . . . . . .      4.13    		2.38
Fourth quarter (from May 29, 1997
 to June 30, 1997) . . . . . . . . . . .    5.06    		3.88

(1) The range of high and low prices for the periods from 
February 28, 1997 to March 31, 1997 and April 1, 1997 to May 
29, 1997, were bid prices as reported by the National Quotation 
Bureau, LLC (the "NQB") and the Nasdaq Trading and Marketing 
Services (the "NTMS"), respectively.  The bid prices obtained 
from NQB and NTMS represent prices between dealers which do not 
include retail markup, markdown or commission and may not 
necessarily represent actual transactions.

As of September 1, 1998, there were approximately 349 holders 
of record of Common Stock.

The Company's Transfer Agent and Registrar is Marine Midland 
Bank, Corporate Trust Services, 140 Broadway, New York, NY 
10005-1180.


The Company is prohibited from paying dividends by the terms of 
its Loan and Security Agreement (as hereinafter defined), 
except for non-cash dividends pursuant to the Rights Agreement. 
The Company did not pay any cash dividends in the fiscal years 
ended June 30, 1998 and 1997.

On February 28, 1997, pursuant to the Plan of Reorganization, 
the Board of Directors of the Company declared a dividend 
distribution of one Right for each outstanding share of Common 
Stock, payable to stockholders of record at the close of 
business on such date and payable with respect to Common Stock 
issued thereafter.

The calculation of the number of shares of Common Stock held by 
non-affiliates shown on the cover page of this Form 10-K Annual 
Report was made on the assumption that there were not 
affiliates other than the executive officers and directors of 
the Company, the Pension Benefit Guaranty Corporation (the 
"PBGC") and Peter Parts Electronics, Inc.

The Plan of Reorganization canceled all of the Old Common Stock 
and provided registered shareholders of the Old Common Stock as 
of August 15, 1996 with warrants to purchase one share of 
Common Stock for each twenty shares of Old Common Stock.  The 
exercise price of the warrants is $8.50 per share.  The 
warrants may be exercised at any time to February 28, 1999.

Item 6.  Selected Financial Data

The following table summarizes certain historical financial 
information derived from the consolidated financial statements 
of the Company.  This information should be read in conjunction 
with the consolidated financial statements and related notes 
and Management's Discussion and Analysis of Results of 
Operations and Financial Condition, both of which are contained 
in this Form 10-K Annual Report.

SELECTED FIVE-YEAR FINANCIAL DATA

(Dollars in thousands,			For the year ended June 30, 
 except per share amounts)    1998    1997       1996    1995(1)   1994(1)

Net sales                  $58,924	 $77,313	  $112,548	 $196,309	 $261,306
Gross margin                13,542	  17,910	     9,193	   15,350	   56,979
Operating income (loss)(2) $(8,497)	$  (858)	 $ (8,576)	$(46,766)	$  8,422
Income (loss) from
 continuing operations     $(7,778)	$  (795)	 $(11,122)	$(62,245)	$  5,094
Discontinued operations
 (net of income taxes):
  Income from discontinued
   operations                   	-	       -	         -	      671	    2,233
  Gain(loss) on disposal
    of discontinued
    operations            	      -	       -	         -	    9,127	   (2,200)
Income (loss) before                   
 extraordinary gain         (7,778)	   (795)	  (11,122)	 (52,447)	   5,127
Extraordinary gain(3)        1,174	   8,122	         -	        -	        -
Net income (loss)          $(6,604)	$ 7,327	  $(11,122)	$(52,447)	$  5,127
Earnings (loss) per common
  Share:
Income (loss) from 
   continuing operations  	$ (2.78)	$  (.32)	 $  (4.50)	$ (25.19)	$   2.06
  Discontinued operations:
   Income from discontinued
    operations           	       -	       -	         -	      .27	      .90
   Gain(loss) on disposal
    of discontinued
    operations     	             -	       -	         -	     3.69	    (.89)
Income (loss) before
 extraordinary gain	         (2.78)	   (.32)	    (4.50)	  (21.23)	   2.07
Extraordinary gain	            .42     3.28  	       -	        -	       -
Net income (loss)   
 per common share
  (basic & diluted)	       $ (2.36)	$  2.96	  $  (4.50)	$ (21.23)	$  2.07

Weighted average common
  shares (000's omitted)(4)	 2,793	   2,471	     2,471	    2,471	   2,471

Working capital	           $25,907	 $27,045	  $ 54,117	 $ 27,116	$ 89,469
Total assets	               50,087	  60,629	    83,872	  136,066	 193,688
Bank loans	                      -	       -	         -	   17,400	  20,002
Stockholders equity	        20,040	  26,390	     9,128	   20,250	  75,722
Cash dividends declared 
  per common share(5)	     $     -	 $     -	  $      -	 $    .10	$    .20

(1) Amounts have been reclassified, where applicable, to 
reflect the discontinued operations of SCM Office Supplies, 
Inc. and Histacount.

(2) Includes approximately a $3,902 gain from the sale of 
manufacturing operations in 1998, a $3,400 pension curtailment 
gain and a $6,500 postretirement curtailment gain in 1997; 
$19,500 restructuring income in 1996 and $14,900 provision in 
1995.


(3) Includes a $1,174 and $8,122 pre-tax and after-tax 
extraordinary gain for debt forgiveness associated with 
emergence from the Bankruptcy Proceedings.

(4) For all periods prior to June 30, 1997 the weighted 
average common and common equivalent shares outstanding are 
based on the weighted average number of common shares 
outstanding from the Effective Date until June 30, 1997.

(5) Based on 30,250,000 shares of Old Common Stock, 
outstanding as of June 30, 1995 and 1994.

Item 7. Management's Discussion and Analysis of Results of Operations 
        and Financial Condition

 
The forward-looking comments in this Management's Discussion 
and Analysis of Results of Operations and Financial Condition 
are estimates by the Company's management of future performance 
and are subject to a variety of risks and uncertainties that 
could cause actual results to differ from management's current 
expectations.

	Year Ended June 30, 1998 Compared to Year Ended June 30, 1997

Results of Operations

Net sales of $58.9 million for the year ended June 30, 1998 
decreased 23.8 percent from net sales for the year ended June 
30, 1997 of $77.3 million, primarily due to lower volumes.  
Unit sales of typewriters, personal word processors and related 
accessories and supplies are lower than a year ago, both 
domestically and internationally, as a result of a shrinking 
market and a continuing difficult and competitive environment. 
The lower volumes are partially offset by newly sourced 
product net sales of $3.8 million. In June 1997, due to 
substantial volume reductions, the Company ceased the 
manufacture of personal word processors; servicing and customer 
support, however is continuing.   

The Company's plan to expand its product line continues.  
Efforts are focused on forging new and expanding existing 
alliances with companies that provide technologically advanced 
products for the small office and home office environment but 
presently do not have a substantial United states market 
penetration and are intent on building or increasing market 
penetration by selling their products under the well-known 
"Smith Corona" name.  Management believes that the Company is 
well positioned to leverage the strength of its brand name with 
business products that combine functionality and contemporary 
design.  The Company intends to rely on its existing 
distribution network to become a leading provider of 
technologically advanced products for the small office and home 
office.  Additionally, the Company is exploring synergistic 
opportunities in related markets that will provide new and 
expand existing channels of distribution.  The Company believes 
that the small office and home office market, globally, 
represents growth opportunities. The Company intends to 
maintain its core business of distributing its product line of 
typewriters and related supplies and accessories to satisfy 
continuing albeit declining worldwide demand.  The success of 
the Company depends, in part, on its ability to source, market 
and sell new products.

In the fourth quarter of the Company's 1998 fiscal year 
competitors began reducing market prices for the low-end 
telephony and facsimile products.  These sharp price declines 
have resulted in the Company having to reduce its low-end 
telephony and facsimile product pricing as well as take charges 
for new product inventory writedowns. 

Gross margin, as a percentage of net sales was 23.0 percent for 
the year ended June 30, 1998 compared with 23.2 percent for the 
same period last year.  Included in cost of goods sold for the 
year ended June 30, 1998 are $.8 million related to favorable 
results of remediation activities of the Company's 
environmental sites. Additionally, cost of goods sold for the 
year ended June 30, 1998 includes inventory writedowns of 
approximately $1.9 million primarily associated with certain 
new product inventories. The gross margin has been favorably 
impacted as a result of a reduction in sales of personal word 
processors for which sales in the prior year had a negative 
impact on margins. Included in cost of goods sold for the year 
ended June 30, 1997 are writedowns of inventories of $1.9 
million.

Selling, general and administrative expenses for the year ended 
June 30, 1998 were $26.4 million or 44.8 percent of net sales 
as compared to $12.7 million or 16.5 percent in the comparable 
prior period.  For the twelve months ended June 30, 1998, 
selling, general and administrative expenses include increased 
spending of $7.7 million to support development, introduction 
and sell-through of newly sourced products offset by $4.0 
million overall reductions in employee-related costs.  The 
Company expects to reduce spending to support development and 
advertising of new products for the twelve months ended June 
30, 1999. Selling, general and administrative expenses for the 
twelve months ended June 30, 1997 includes a pension plan 
curtailment gain of $3.4 million and a postretirement 
curtailment gain of $6.5 million.

Effective September 28, 1998, the Company's Board of Directors 
approved a restructuring program which includes: i.) the 
elimination of approximately 130 positions primarily located at 
the Company's Corporate Headquarters in Cortland, New York, 
ii.) the sale or lease of the building in Cortland, New York, 
iii.) relocation of the Corporate Headquarters to more 
efficient facilities.  The Company expects the restructuring 
program to be completed by June 30, 1999.  As a result of these 
actions, the Company will record a first quarter pre-tax 
charge, principally for severance payments, of approximately 
$1.2 million.

On November 24, 1997, the Company completed the sale of its 
manufacturing operations (the "Sale").  The Sale generated 
total net proceeds of $14.9 million and resulted in a gain of 
$3.9 million.  In addition the Company entered into a long-term 
manufacturing agreement pursuant to which the purchaser will 
manufacture certain Smith Corona brand name products, including 
typewriters and related supplies and accessories.

For the twelve months ended June 30, 1998 the Company recorded 
an extraordinary gain of $1.2 million for the favorable 
resolution of bankruptcy claims.  Included in the twelve months 
ended June 30, 1997 is an extraordinary gain of $8.1 million 
(pre-tax and after-tax)as a result of the Company's emergence 
from Chapter 11 on February 28, 1997 for debt forgiveness.


Financial Condition

The Company's primary source of liquidity and capital 
resources, on both a short- and long-term basis, are cash and 
available borrowing capacity.

On February 28, 1997, the Company entered into a loan and 
security agreement ("Loan and Security Agreement") with its 
lender.  The Loan and Security Agreement provides for 
extensions of revolving credit loans, term loans and letters of 
credit, limited to a percentage of eligible accounts receivable 
and inventories in the amount not to exceed $25.0 million 
through the February 28, 2000 expiration date.  Interest is .75 
percent over the Prime Rate or 3 percent over the Adjusted 
Eurodollar rate.  Payment of dividends is prohibited by the 
terms of the Loan and Securities Agreement, except for non-cash 
dividends pursuant to the Rights Agreement. Pursuant to the 
provisions of the Loan and Securities Agreement the Company 
must maintain an adjusted net worth of $11.1 million.  
Management believes that it has adequate flexibility and that 
such a covenant should not impose an undue restriction on the 
operations of the Company.  The Loan and Security Agreement is 
secured by all of the Company's assets.  There are no 
borrowings under the Loan and Securities Agreement as of June 
30, 1998.

During the twelve months ended June 30, 1998 the Company's 
operating activities used $18.5 million of cash, primarily as a 
result of the net loss before consideration of the $3.9 million 
gain on the Sale and increase of inventory levels.  The 
increase in inventory was due primarily to new product 
inventory receipts partially offset by a decrease of $4.7 
million in raw material and work-in-process inventories 
associated with the Sale.  Capital expenditures for the twelve 
months ended June 30, 1998 were $3.2 million compared to $1.0 
million in the prior year.  Capital expenditures are comprised 
primarily of new product tooling of $1.3 million and new 
information systems hardware and SAP R/3 software of $1.7 
million.  The Company had no material commitments for 
additional capital expenditures at June 30, 1998.

The Company believes that its cash and borrowing capabilities 
will be sufficient to meet its operating cash and capital 
expenditure requirements in the foreseeable future.

The Company's products and major operating systems are year 
2000 compliant. The Company is in the process of gathering 
information concerning the year 2000 compliance status of its 
suppliers.  In the event that any of the Company's significant 
suppliers do not successfully and timely achieve year 2000 
compliance, the Company's business could be adversely affected. 
Any significant disruption of the Company's ability to 
communicate electronically with its business partners could 
negatively impact the Company's business.

Year Ended June 30, 1997 Compared to Year Ended June 30, 1996

With the Company experiencing sales declines and operating 
losses, having extended payment of obligations owed to its 
trade vendors, and needing additional financing to meet 
operating requirements and fund the Restructuring, the Company 
filed a voluntary petition for relief under Chapter 11 of the 
Bankruptcy Code in the Bankruptcy Court on July 5, 1995.  On 
August 18, 1995, SCM Office Supplies, Inc., SCC LI Corporation 
(formerly Histacount Corporation) and Hulse Manufacturing 
Company, the Nonoperating Subsidiaries, filed Chapter 11 
petitions. On October 31, 1996 the Wholly-Owned Domestic 
Subsidiaries, Smith Corona Overseas Holdings, Inc., SCM Inter-
American Corporation and SCM (United Kingdom) Limited, filed 
voluntary petitions for relief under Chapter 11 of the 
Bankruptcy Code. 

On January 27, 1997 the Bankruptcy Court entered the 
Confirmation Order and the Company emerged from the Bankruptcy 
Proceedings on the Effective Date of February 28, 1997.

During the Bankruptcy Proceedings, the Company confined 
expenditures to those manufacturing and operating costs that 
were necessary to preserve and maintain going-concern value.  
In light of its financial condition, the Company also 
implemented a planned reduction in its workforce and a 
consolidation of its manufacturing and distribution operations 
and relocated its world headquarters from New Canaan, 
Connecticut to its facility in Cortland, New York. 
Additionally, as part of the Restructuring, the Company 
relocated its typewriter manufacturing operations to its Mexico 
facility from facilities in Singapore and Batam Island, 
Indonesia.

Results of Operations

Net sales of $77.3 million for the year ended June 30, 1997 
decreased 31.3 percent from net sales for the year ended June 
30, 1996 of $112.5 million, primarily due to lower volumes.  
Unit sales of typewriters, personal word processors and related 
accessories and supplies were lower than a year ago, both 
domestically and internationally, as a result of a shrinking 
market and a continuing difficult and competitive environment. 
 Due to substantial volume reductions, in June 1997 the Company 
ceased the manufacture of personal word processors; servicing 
and customer support of personal word processors, however, is 
continuing.   

Gross margin, as a percentage of net sales, was 23.2 percent 
for the year ended June 30, 1997 as compared to 8.2 percent for 
the comparable period last year.  The margin improvement was 
primarily the result of manufacturing efficiencies gained from 
the Restructuring and proportionate increases of sales of 
higher margin products.  Included in cost of goods sold were 
writedowns of inventories of $1.9 million and $4.3 million, for 
the years ended June 30, 1997 and June 30, 1996, respectively.

Selling, general and administrative expenses for the year ended 
June 30, 1997 were 16.5 percent of net sales as compared to 
24.7 percent in the comparable period last year.  The decreases 
reflected the overall savings in employee-related costs as a 
result of the Restructuring and reorganization efforts as well 
as the impact of a pension plan curtailment gain of $3.4 
million and a postretirement curtailment gain of $6.5 million. 
During the Bankruptcy Proceedings professional fees were 
charged to reorganization costs in the consolidated statements 
of operations.

The Company recorded reorganization costs for its Bankruptcy 
Proceedings aggregating $5.9 million for the year ended June 
30, 1997 compared to $10.3 million for the same period a year 
ago.  The charges for the year ended June 30, 1997 included 
professional fees, a provision for closing its world 
headquarters in New Canaan, Connecticut and relocating such to 
its facility in Cortland, New York and costs associated with 
the distribution of the Plan of Reorganization, offset by 
income from a purchase deposit forfeiture of $.5 million, 
interest income earned on domestic cash balances of $.6 million 
and a settlement the Company reached with its banks relating to the Company's 
debtor-in-possession financing of $.5 million.

As a result of emergence from the Bankruptcy Proceedings the 
Company recorded a pre-tax and after-tax extraordinary gain of 
$8.1 million for debt forgiveness.


Item 8. Financial Statements and Supplementary Data

See Consolidated Financial Statements in this Form 10-K Annual 
Report.

Item 9. Changes in and Disagreements with Accountants on Accounting 
        and Financial Disclosure

None.

PART III

Item 10. Directors and Executive Officers of the Registrant

The information required by this item is incorporated by 
reference from Part I of this Form 10-K Annual Report and the 
Company's definitive Proxy Statement for the 1998 Annual 
Meeting of Stockholders, to be filed with the Securities and 
Exchange Commission on or about September 28, 1998.

Item 11. Executive Compensation

The information required by this item is incorporated by 
reference from the Company's definitive Proxy Statement for the 
1998 Annual Meeting of Stockholders, to be filed with the 
Securities and Exchange Commission on or about September 28, 
1998.

Item 12. Security Ownership of Certain Beneficial Owners and Management

The information required by this item is incorporated by 
reference from the Company's definitive Proxy Statement for the 
1998 Annual Meeting of Stockholders, to be filed with the 
Securities and Exchange Commission on or about September 28, 
1998.

Item 13. Certain Relationships and Related Transactions

The information required by this item is incorporated by 
reference from the Company's definitive Proxy Statement for the
1998 Annual Meeting of Stockholders, to be filed with the 
Securities and Exchange Commission on or about September 28, 
1998.


	PART IV

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

(a)(1)  Financial Statements. See Consolidated 
Financial Statements in this Form 10-K Annual Report.

(a)(2)  Financial Schedules. See Consolidated Financial 
Statements in this Form 10-K Annual Report.  All other 
schedules are omitted because they are not applicable 
or the required information is shown in the financial 
statements or notes thereto.

(b) Reports on Form 8-K.
 None

 (c) Exhibits (filed herewith or incorporated by 
reference; see index to exhibits).

2.1 Debtors' Third Amended Second Joint Plan of 
Reorganization under Chapter 11 of the United States 
Bankruptcy Code (incorporated by reference to Exhibit 2.1 to 
the Registrant's Annual Report on Form 10-K for the fiscal 
year ended June 30, 1996 (File No. 1-10281) (see Exhibit A 
included therein).
2.2 Motion to Approve Technical Amendments to the Debtors' 
Third Amended Second Joint Plan of Reorganization, as approved 
by the United States Bankruptcy Court for the District of 
Delaware (incorporated by reference to Exhibit 2 to the 
Registrant's Registration Statement on Form 8-A dated January 
30, 1997 (File No. 1-10281)).
3.1 Restated Certificate of Incorporation of Smith Corona 
Corporation (incorporated by reference to Exhibit 3.1 to the 
Registrant's Form 8-K Current Report dated February 28, 1997 
(File No. 1-10281)).
3.2	Certificate of Designation, Preferences and Rights of 
Preferred Stock, Series A (incorporated by reference to 
Exhibit 3.2 to the Registrant's Form 8-K Current Report dated 
February 28, 1997 (File No. 1-10281)).
3.2 By-Laws of Smith Corona Corporation (incorporated by 
reference to Exhibit 3.3 to the Registrant's Form 8-K Current 
Report dated February 28, 1997 (File No. 1-10281)).
4.1 Rights Agreement between Smith Corona Corporation and 
Marine Midland Bank, as Rights Agent, dated as of February 28, 
1997 (incorporated by reference to Exhibit 4.1 to the 
Registrant's Form 8-K Current Report dated February 28, 1997 
(File No. 10281)).
4.2 Warrant Agreement between Smith Corona Corporation and 
Marine Midland Bank, as Warrant Agent, dated as of February 
28,1997 (incorporated by reference to Exhibit 4.2 to the 
Registrant's Form 8-K Current Report dated February 28, 1997 
(File No. 1-10281)).
10.1 Smith Corona Corporation Retirement Savings and 
Investment Plan adopted effective July 1, 1989, as amended and 
restated effective January 1, 1997. (incorporated by reference 
to exhibit 10.1 to the Registrant's Annual Report on Form 10-K 
for the fiscal year ended June 30, 1997). 
10.2 The CORPORATE plan for Retirement, The Profit 
Sharing/401(K) Plan, Fidelity Basic Plan Document No. 07 
effective July 1, 1997 (incorporated by reference to exhibit 
10.2 for the fiscal year ended June 30, 1997).
10.3 Adoption Agreement - Article 1 between Smith Corona 
Corporation and Fidelity Management Trust Company, as Trustee 
effective July 1, 1997 (incorporated by reference to exhibit 
10.3 for the fiscal year ended June 30, 1997).
10.4 Export Enterprise Certificate No. 156 granted to 
Smith-Corona Private Limited by the Ministry of Trade and 
Industry, Republic of Singapore, dated May 12, 1981 
(incorporated by reference to Exhibit 10.15 to the Company's 
Registration Statement on file with the Commission 
(Registration No. 33-29101)).
10.5 Pioneer Certificate No. 942 granted to Smith Corona 
PTE Ltd. by the Ministry of Trade and Industry, Republic of 
Singapore, dated March 23, 1987 (incorporated by reference to 
Exhibit 10.16 to the Company's Registration Statement on file 
with the Commission (Registration No. 33-29101)).
10.6 Stockholders' Agreement between Smith Corona 
Corporation and HM Holdings, Inc. dated as of June 2, 1989 
(incorporated by reference to Exhibit 10.17 to the Company's 
Registration Statement on file with the Commission 
(Registration No. 33-29101)).
10.7 Amended and Restated Cross-Indemnification Agreement 
between Smith Corona Corporation and HM Holdings, Inc. dated 
as of July 14, 1989 (incorporated by reference to Exhibit 
10.18 to the Company's Registration Statement on file with the 
Commission (Registration No. 33-29101)).
10.8 Amended and Restated Tax Sharing and Indemnification 
Agreement between Smith Corona Corporation and HM Holdings, 
Inc. dated as of June 2, 1989 (incorporated by reference to 
Exhibit 10.19 to the Company's Registration Statement on file 
with the Commission (Registration No. 33-29101)).
10.9 Smith Corona Corporation Salaried Employees Retirement 
Plan, as amended and restated as of January 1, 1994 
(incorporated by reference to Exhibit 10.32 to the Company's 
Form 10-K Annual Report for the fiscal year ended June 30, 
1995, which is on file with the Commission).
10.10 Lease Agreement between Turnberry Associates and Smith 
Corona Corporation dated May 5, 1993 (incorporated by 
reference to Exhibit 10.49 to the Company's Form 10-K Annual 
Report for the fiscal year ended June 30, 1993, which is on 
file with the Commission).
10.11 Stock Purchase Agreement among Smith Corona 
Corporation and W. Michael Driscoll, as Sellers and the MATCO 
Electronics Group, Inc. and U.S. Assemblies San Diego, Inc., 
as Buyers dated of November 24, 1997 (incorporated by 
reference to Exhibit 10.1 to the Company's Form 8-K Current 
Report dated November 17, 1997 which is on the file with the 
Commission).
10.12 Asset Purchase Agreement among Smith Corona 
Corporation, as Seller, U.S. Assemblies San Diego, Inc, as 
Buyer, and the MATCO Electronics Group, Inc., as Guarantor 
dated as of November 14, 1997 (incorporated by reference to 
Exhibit 10.2 to the Company's  Form 8-K Current Report dated 
November 17, 1997 which is on file with the Commission).
10.13 Contract manufacturing Agreement, The MATCO 
Electronics Group, Inc., and Smith Corona Corporation dated 
November 24, 1997 (incorporated by reference to Exhibit 10.3 
to the Company's Form 8-K Current Report dated November 17, 
1997 which is on file with the Commission).
10.14 Loan and Security Agreement by and between Congress 
Financial Corporation, as Lender, and Smith Corona 
Corporation, as Borrower, dated February 28, 1997 
(incorporated by reference to Exhibit 10 to the Company's Form 
10-Q Quarterly Report for the quarterly period ended March 31, 
1997, which is on file with the Commission).
10.15 First Amendment to Loan and Security Agreement dated 
July 2, 1997 (incorporated by reference to Exhibit 10.27 to 
the Company's Form 10-K Annual Report for the fiscal year 
ended June 30, 1997, which is on file with the Commission).
10.16 Employment Agreement between Smith Corona Corporation 
and W. Michael Driscoll dated as of October 14, 1996 amended 
as of June 2, 1997 (incorporated by reference to Exhibit 10.28 
to the Company's Form 10-K Annual Report for the fiscal year 
ended June 30, 1997, which is on file with the Commission).
10.17 Employment Agreement between Smith Corona Corporation 
and John A. Piontkowski dated as of May 5, 1997 (incorporated 
by reference to Exhibit 10.29 to the Company's Form 10-K 
Annual Report for the fiscal year ended June 30, 1997, which 
is on file with the Commission).
*10.18	Smith Corona Corporation Stock Incentive Plan 
*21	Schedule of Subsidiaries of the Registrant
*27	Financial Data Schedule

* Filed herewith

Stockholders may, upon payment of a fee therefor, obtain copies 
of any of the exhibits to this Form 10-K Annual Report by 
writing to the Secretary, Smith Corona Corporation, 839 Route 
13 South, Cortland, New York 13045.





	SIGNATURES

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

SMITH CORONA CORPORATION

September 28, 1998				By  /s/ Peter N. Parts 
                          Peter N. Parts
                          Chairman of the Board,
                          Chief Executive Officer 
                          and President

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

Signature					Title	Date

/s/ Peter N. Parts
 .......................    Chairman of the Board,
   (Peter N. Parts)        Chief Executive Officer 
                           and President 	September 28, 1998
 					  	
/s/ John A. Piontkowski
 ........................   Executive Vice President and	September 28, 1998
   (John A. Piontkowski)	  Chief Financial Officer
                           (Principal Financial Officer)

/s/ Jerome A. Colletti
 ........................   Director                      September 28, 1998
   (Jerome A. Colletti)	

/s/ William J. Morgan
 ........................   Director	September 28, 1998
   (William J. Morgan)

/s/ Michael J. Murray
 ........................   Executive Vice President	September 28, 1998
   (Michael J. Murray)	    Sales and Marketing 	
                           and Director
 
/s/ Dr. Richard N. Rosett
 ........................   Director	September 28, 1998
   (Dr. Richard N. Rosett)


/s/ Martin D. Wilson
 ........................   Vice President/Controller	September 28, 1998
   (Martin D. Wilson)	     (Principal Accounting
                            Officer)





Index to Consolidated Financial Statements and Financial Statement Schedule

                                                                	Page

Independent Auditors' Report	                                    26

Consolidated Balance Sheets as of June 30, 1998 and 1997	        27

Consolidated Statements of Operations for the Years Ended June 
30, 1998, 1997 and 1996	                                         28

Consolidated Statements of Changes in Stockholders' Equity for 
the Years Ended June 30, 1998, 1997 and 1996	                    29

Consolidated Statements of Cash Flows for the Years Ended June 
30, 1998,  1997 and 1996	                                        30

Notes to Consolidated Financial Statements	                      32

Consolidated Supplemental Financial Statement Schedule for the 
Years Ended June 30, 1998, 1997 and 1996

Schedule II - Valuation and Qualifying Accounts	                 55

INDEPENDENT AUDITORS? REPORT
Smith Corona Corporation:

We have audited the accompanying consolidated balance sheets of 
Smith Corona Corporation and subsidiaries (the ?Company?) as of 
June 30, 1998 and 1997, and the related consolidated statements 
of operations, statements of changes in stockholders? equity and 
statements of cash flows for each of the three years in the 
period ended June 30, 1998.  Our audits also include the 
financial statement schedule listed in the Index to Consolidated 
Financial Statements and Financial Statement Schedule.  These 
financial statements and financial statement schedule are the 
responsibility of the Company?s management.  Our responsibility is 
to express an opinion on these financial statements and financial 
statement schedule based on our audits.

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

In our opinion, such consolidated financial statements present 
fairly, in all material respects, the financial position of Smith 
Corona Corporation and subsidiaries at June 30, 1998 and 1997 and 
the results of their operations and their cash flows for each of 
the three years in the period ended June 30, 1998 in conformity 
with generally accepted accounting principles.  Also, in our 
opinion, such financial statement schedule, when considered in 
relation to the basic consolidated financial statements taken as 
a whole, presents fairly in all material respects the information 
set forth therein.

 

/s/ Deloitte & Touche LLP
-------------------------
DELOITTE & TOUCHE LLP
Stamford, Connecticut
August 21, 1998
(September 28, 1998 as to note 16)

	Smith Corona Corporation and Subsidiaries
	Consolidated Balance Sheets
    
                                               June 30,
(Dollars in thousands)	                       1998 	1997 

Assets		
Current assets:		
Cash and cash equivalents	                 $ 15,293	$ 21,985 
Accounts receivable (net of allowance
 for doubtful accounts of $638 and
 $931 for 1998 and 1997, respectively) 	      9,492 	 11,238 
Inventories	                                 15,399  	12,627 
Prepaid expenses and other current
 assets 	                                     3,090 	  2,108 
Total current assets	                        43,274 	 47,958 
Property, plant and equipment-net	            6,511  	12,092 
Other assets	                                   302 	    579 
Total		                                    $ 50,087 $ 60,629 

Liabilities and stockholders' equity		
Current liabilities:
Trade payables	                            $  6,025 $  5,199 
Accrued liabilities	                          8,204 	 11,614 
Income taxes payable	                         3,138 	  4,100 
Total current liabilities	                   17,367 	 20,913 
Postretirement benefits	                      3,846 	  5,904 
Pension liability	                            4,827 	  4,777 
Other long-term liabilities	                  4,007 	  2,645 
Total liabilities	                           30,047   34,239 
Stockholders' equity:		
Common stock- 3,141,665 shares and
 2,754,238 shares issued
 and outstanding, respectively	                   3 	      3 
Additional paid-in capital	                  55,512 	 55,164 
Deferred compensation	                         (326)	   (232)
Accumulated deficit 	                       (35,149)	(28,545)
Total stockholders' equity	                  20,040 	 26,390 
Total		                                    $ 50,087 $ 60,629 

See accompanying notes to consolidated financial statements.

	Smith Corona Corporation and Subsidiaries
	Consolidated Statements of Operations



(Dollars in thousands,                       	For the year ended June 30, 
  except per share amounts)	                   1998 	   1997 	   1996 

Net sales	                                    $58,924	$ 77,313	$112,548
Cost of goods sold	                            45,382	  59,403	 103,355
Gross margin	                                  13,542	  17,910	   9,193
Selling, general and administrative
 Expenses	                                     26,371	  12,754	  27,773
Gain on sale of manufacturing operations	      (3,902)	      -	       -
Reorganization (income) costs	                   (280)	  5,864	  10,255
Restructuring expense (income)	                     - 	      -  (19,461)
Other (income)expense                        	   (150)	    150	    (798)
Operating loss                           	     (8,497)	   (858) 	(8,576)
Interest (income) expense 	                    (1,063)	   (326)	    515
Loss from continuing 
 operations before income taxes
 and extraordinary gain	                       (7,434)	   (532)	 (9,091)
Income taxes                                      344	     263	   2,031
Loss before extraordinary gain 	               (7,778)	   (795)	(11,122)
Extraordinary gain                        	     1,174	   8,122	       -
Net income (loss)	                            $(6,604)	$ 7,327	$(11,122)
Earnings (loss) per common share 
  (basic and diluted):			
   Loss before extraordinary gain	            $ (2.78)	$(  .32)	$ (4.50)
   Extraordinary gain                     	       .42 	   3.28	       -
   Net income (loss)  	                       $ (2.36)	$  2.96	 $ (4.50)
    	                                   	 
 

See accompanying notes to consolidated financial statements.

	Smith Corona Corporation and Subsidiaries
	Consolidated Statements of Changes in Stockholders' Equity
	For the years ended June 30, 1998, 1997 and 1996

                                                           
                                                           
                                  Additional Deferred     (Accumu-
                          Common  Paid-In    Compens-     lated
                           Stock  Capital    ation        Deficit)     Total

 
Balance June 30, 1995	      $303	 $44,697	         -	     $(24,750)	$20,250

Net loss	                      -	       -	         -	      (11,122)	(11,122)

Balance June 30, 1996	       303	  44,697	         -      	(35,872)	  9,128

Net income	                    -	       -	         -        	7,327	   7,327

Deferred compensation	         -	     267	     $(267)	           -	       -

Amortization of deferred
  compensation	                -	       -	        35	            -	      35

Cancellation of old
  common stock	             (303)	    303	         -	            -	       -

Issuance of common 
  stock to creditors	          3	   9,897	         -	            -	   9,900

Balance June 30, 1997	         3	  55,164	      (232)	     (28,545)	 26,390

Net loss	                      -	       -	         -	       (6,604)	 (6,604)

Deferred compensation	         -	     345	      (345)	           -	       -	

Amortization of deferred 
  compensation	                -	       -	       251     	       -	     251 

Exercise of warrants	          -	       3	         -	            -	       3	

Balance June 30, 1998	    $    3	 $55,512	    $ (326)	    $(35,149)	$20,040 

See accompanying notes to consolidated financial statements.

	Smith Corona Corporation and Subsidiaries
	Consolidated Statements of Cash Flows


	                                         	For the year ended June 30, 
(Dollars in thousands)	                    1998	       1997	     1996

Cash flows from operating activities:

Net (loss) income                          $(6,604)	$7,327	$(11,122)
Adjustments to reconcile net income
 (loss) to net cash provided by (used in)
 continuing operating activities:			
  Depreciation and amortization	             2,289	  3,534	   5,665
  Loss (gain) on disposition of property,
   plant and equipment	                        192	   (450)	(16,786)
  Gain on sale of manufacturing operations	 (3,902)	     -	       -
  Deferred income taxes	                         -	      -	   3,406
  Inventory provisions                      	1,056  	2,364	   5,199
  Pension curtailment gain	                      -	 (3,394)	 (1,524)
  Extraordinary gain                       	(1,174)	(8,122)	      -
  Postretirement curtailment gain	               -	 (6,534)	      -
  Other noncash items	                           -	   (132)	    832
Changes in assets and liabilities:			
  Accounts receivable                       	1,654	  5,947	  20,469
  Inventories                              	(7,980) 	1,882	  32,263
  Prepaid expenses and other 
    current assets	                         (1,170)	 2,646	  (1,177)
  Other assets	                                 36	   (102)	    777
  Trade payables	                              974	  1,696	  (5,821)
  Accrued liabilities and income 
    taxes payable                          	(3,220)	  (158)	(16,310)
  Postretirement benefits and 
    pension liability                      	(2,008)	(1,270)	    (98)
  Other long-term liabilities           	    1,362	   (217) 	    81
Net cash (used in) provided by 
 operating activities                    	 (18,495)	  5,017	 15,854
Cash flows from investing activities:
Proceeds from sale of
 manufacturing operations	                  14,903       	-	      -
Proceeds from the sale of property,
 plant and equipment	                          100	     512	 24,803
Capital expenditures	                       (3,200)	   (999)	  (331)
Net cash provided by (used in)
 investing activities	                      11,803	    (487)	24,472



Smith Corona Corporation and Subsidiaries
Consolidated Statements of Cash Flows
Continued

                                             	For the year ended June 30, 
(Dollars in thousands)	                       1998       	1997	     1996

Cash flows from financing activities:	
Bank loans (repayments), net	                    -	          -  	(17,400)
Payments made to settle	
 liabilities subject to 	
 compromise	                                     -	    (12,474)	       -
Net cash used in financing activities 	          -	    (12,474)	 (17,400)
Increase (decrease) in cash and
 cash equivalents                          	(6,692)	    (7,944)	  22,926
Cash and cash equivalents:
 Beginning of year	                         21,985     	29,929    	7,003
 End of year	                              $15,293	    $21,985	  $29,929
Cash paid during the year for:
Interest                                  	$     -	    $     -	  $   662
Income taxes                           	   $   185	    $   610	  $   644 

See accompanying notes to consolidated financial statements.


Smith Corona Corporation and Subsidiaries
Notes to Consolidated Financial Statements
(Dollars in thousands, except per share amounts)

1. Significant Accounting Policies 

Basis of Consolidation and Presentation: The consolidated 
financial statements include the accounts of Smith Corona 
Corporation and its wholly-owned subsidiaries.  All 
significant intercompany accounts and transactions have been 
eliminated. 

The consolidated financial statements for the year ended June 
30, 1996 are presented in accordance with the American 
Institute of Certified Public Accountants Statement of 
Position 90-7: "Financial Reporting by Entities in 
Reorganization Under the Bankruptcy Code".  The consolidated 
financial statements are prepared in accordance with 
generally accepted accounting principles applicable to a 
going concern, which contemplates the realization of assets 
and the satisfaction of liabilities in the normal course of 
business.  Accordingly, the consolidated financial statements 
for the year ended June 30, 1996 did not reflect adjustments 
or provide for the potential consequences of the bankruptcy 
proceedings.

Management 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 and the reported amounts of 
revenue and expenses during the reporting periods. Actual 
results could differ from those estimates.

Statement of Cash Flows:  All highly liquid investments 
purchased with a maturity of three months or less are 
considered to be cash equivalents.  Included in the fiscal 
year ended June 30, 1996 ("Fiscal 1996") gain (loss) on 
disposition of property, plant and equipment is the gain from 
the sale of a building in Singapore of $17,755.  This item is 
included in the Fiscal 1996 Statement of Operations as 
restructuring income.

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

Property, Plant and Equipment:  Property, plant and equipment 
are stated at cost.  Depreciation is provided on the 
straight-line basis at rates based on estimated useful lives. 
 Lives used in computing depreciation range from two to 
twelve years for equipment and up to forty years for 
buildings.  Leasehold improvements are amortized over the 
lease term.  Maintenance and repairs are charged against 
operations as incurred.  Expenditures that materially 
increase capacities or extend useful lives of property, plant 
and equipment are capitalized.


The Company periodically reviews the carrying value of its 
long-lived assets to identify and assess impairment.
 
Retirement Plans: During the year ended June 30, 1997, the 
Company terminated its defined benefit pension plan for 
hourly employees and froze the benefits of its defined 
benefit pension plan for salaried employees (see Note 10).  
Outside of the United States, costs are accrued and paid in 
accordance with local requirements.

Postretirement Plans:  The Company provides for the expected 
cost of postretirement benefits over the employee's years of 
active service.  In June 1997, the Company implemented a new 
premium structure for retiree health care benefits whereby 
retired employees will absorb the total cost of health care 
premiums phased in over three years (see Note 10).

Revenue Recognition:  Net sales are recognized when products 
are shipped. Accruals for customer discounts and rebates, and 
defective returns are recorded as the related revenue is 
recognized.

Advertising Costs:  Costs incurred in producing media 
advertising are expensed the first time the advertising takes 
place.  Advertising associated with customer benefit programs 
are accrued as the related revenues are recognized.

Research and Development:  The Company's product development 
costs are expensed as incurred.  Research and development 
expense was $4,805, $1,915 and $1,991 for the years ended 
June 30, 1998, 1997 and 1996, respectively.

Goodwill:  The excess of the allocated acquisition cost over 
the fair value of net assets of businesses acquired are 
amortized by the straight-line method over forty years.  Due 
to operating losses and uncertainty of future operations, the 
Company wrote off the remaining net book value of goodwill of 
approximately $739 in the year ended June 30, 1996.

Foreign Currency:  The functional currency of the Company's 
foreign operations is deemed to be the United States dollar. 
 Consequently, all translation gains and losses are included 
in income.

Environmental Remediation Costs: The Company accrues for 
losses associated with environmental remediation obligations 
when such losses are probable and reasonably estimable.  
Costs of future expenditures for environmental remediation 
obligations are not discounted to their present value.

Income Taxes:  Deferred income taxes are determined based on 
the difference between the financial statement and tax basis 
of assets and liabilities using enacted tax rates in effect 
for the year in which the differences are expected to 
reverse. 


Stock-Based Compensation - The Company adopted the 
disclosure-only provisions of Statement of Financial 
Accounting Standards No. 123, "Accounting for Stock-Based 
Compensation" ("FAS 123"), in the first quarter of the year 
ended June 30, 1997.  The Company, as provided for by FAS 
123, is continuing to apply Accounting Principles Board 
Opinion No. 25, "Accounting for Stock Issued to Employees" 
for employee stock compensation measurement.

Earnings (Loss) Per Common Share: In the second quarter of 
the year ended June 30, 1998, the Company adopted Statement 
of Financial Accounting Standards No. 128 " Earnings per 
Share" ("SFAS 128").  Accordingly, all periods have been 
restated to present basic and diluted earnings (loss) per 
common share.  Earnings (loss) per common share for the 
twelve months ended June 30, 1997 are based on the weighted 
average number of common shares outstanding from the 
Effective Date until June 30, 1997.   



The following tables reconcile the numerators and denominators 
of the basic and diluted earnings per share for income (loss) 
before extraordinary gain presented in the Consolidated 
Statements of Operations:

					  Twelve months ended June 30, 1998	
					  			   Shares 	 
				     Income (loss) (000's omitted) Per-Share 
					  (Numerator)  (Denominator)   Amount
 							 			 			 
Basic Earnings per Share
  Income (loss) before 
    extraordinary gain		        $(7,778)		2,793 	 $(2.78)

Effect of dilutive securities
  Warrants				                       (a)		   (a)
  Stock Options				                  (b)		   (b)
  Restricted Stock			                 - 		   (c)	

Diluted Earnings per Share
  Income (loss) before 
    extraordinary gain and 
    effect of
    dilutive securities		       $(7,778)		2,793	 $(2.78)


					   Twelve months ended June 30, 1997	
								   Shares 	 
				     Income (loss) (000's omitted) Per-Share 
					  (Numerator)  (Denominator)   Amount  

Basic Earnings per Share
  Income (loss) before 
     extraordinary gain	     $ (795)		2,471	  $(.32)

Effect of dilutive securities
  Warrants				                   (a)		   (a)
  Stock Options				               - 		    -
  Restricted Stock			             -	 	   (c)

Diluted Earnings per Share
  Income (loss) before 
    extraordinary gain and 
    effect of 
    dilutive securities		$ (795)		2,471	  $(.32)

(a) Warrants to purchase 1,512,073 shares of common stock at 
$8.50 per share were outstanding but were not included in the 
computation of diluted earnings per share because the 
exercise price was greater than the market price of the common 
shares.
(b) Options to purchase 144,625 shares of common stock at 
$6.13 per share were outstanding but were not included in the 
computation of diluted earnings per share because the option 
price was greater than the average market price of the common 
shares.  There were no options outstanding as of June 30, 
1997.

(c) Restricted stock of 158,282 shares at June 30, 1998 and 
93,894 shares at June 30, 1997 would have had an anti-
dilutive effect in computation.

For comparability purposes, basic and diluted earnings (loss) 
per common share for the twelve months ended June 30, 1996, 
is based on 2,471,336 shares, the weighted average number of 
common shares outstanding from February 28, 1997, the date of 
emergence from bankruptcy proceedings, until June 30, 1997. 

New Financial Accounting Standards Board Releases: Statements 
of Financial Accounting Standards No. 130 "Reporting 
Comprehensive Income" ("SFAS 130"), and No. 131, "Disclosures 
About Segments of an Enterprise and Related Information" 
("SFAS 131"), were issued in June, 1997.

SFAS 130 establishes standards for reporting and display of 
comprehensive income and its components in a full set of 
general purpose financial statements.  It requires that all 
items that are required to be recognized under accounting 
standards as components of comprehensive income be reported 
in a financial statement that is displayed with the same 
prominence as other financial statements.  Comprehensive 
income is defined as "the change in equity of a business 
enterprise during a period from transactions and other events 
and circumstances from nonowner sources.  It includes all 
changes in equity during a period, except those resulting 
from investments by owners and distributions to owners".  
This statement is effective for fiscal years beginning after 
December 15, 1997.  The Company does not expect to be 
affected by this new standard.

SFAS 131 established the way that public business enterprises 
report information about operating segments in annual 
financial statements and requires that those enterprises 
report selected information about operating segments in 
interim financial reports issued to stockholders. It also 
establishes standards for related disclosures about products 
and services, geographic areas, and major customers.  This 
statement is effective for financial statements for periods 
beginning after December 15, 1997.  The disclosure impact of 
this statement is currently being assessed by the Company.

Reclassifications:  Certain reclassifications have been made 
to the prior years' financial statements to conform with the 
1998 presentation.   


2. Petition for Reorganization Under Chapter 11 

	On July 5, 1995 (the "Petition Date"), Smith Corona 
Corporation (the "Company") filed a voluntary petition for 
relief under Chapter 11 of the United States Bankruptcy Code 
(the "Bankruptcy Code") in the United States Bankruptcy Court 
for the District of Delaware (the "Bankruptcy Court").  On 
August 18, 1995, SCM Office Supplies, Inc., SCC LI 
Corporation (formerly known as Histacount Corporation) and 
Hulse Manufacturing Company, all wholly-owned nonoperating 
subsidiaries of the Company (collectively, the "Nonoperating 
Subsidiaries"), filed Chapter 11 petitions.  On October 31, 
1996, Smith Corona Overseas Holdings, Inc., SCM Inter-
American Corporation and SCM (United Kingdom) Limited, all 
wholly-owned domestic subsidiaries (the "Wholly-Owned 
Domestic Subsidiaries"), also filed Chapter 11 petitions.  
(The petitions of the Company, the Nonoperating Subsidiaries 
and the Wholly-Owned Domestic Subsidiaries are referred to 
herein collectively as the ?Bankruptcy Proceedings?).  The 
primary purpose of the October 31, 1996 filings, which had no 
effect on operations, was to better protect corporate assets 
during the reorganization period.  The Bankruptcy Proceedings 
primarily related to all U.S. assets and operations and did 
not pertain to the Company's international subsidiaries.  
From July 5, 1995 to February 28, 1997, the Company operated 
as a debtor-in-possession.

	On January 27, 1997 the Bankruptcy Court entered an 
order confirming the Company's Third Amended Second Joint 
Plan of Reorganization (the "Confirmation Order").  The 
Confirmation Order was subject to satisfaction of certain 
conditions precedent to the effective date.  The Company 
satisfied the conditions and emerged from the Bankruptcy 
Proceedings on February 28, 1997 (the "Effective Date").

		The Company recorded reorganization costs relating to 
its Bankruptcy Proceedings aggregating $5,864 for the year 
ended June 30, 1997.  These charges include professional 
fees, a provision for closing the New Canaan, Connecticut 
headquarters and relocation of such headquarters to Cortland, 
New York, and costs associated with the distribution of the 
Company's Third Amended Second Joint Plan of Reorganization 
(the "Plan of Reorganization") for the solicitation of 
creditors, offset by interest income earned on domestic cash 
balances of $607, a purchase deposit forfeiture of $500 and a 
settlement the Company reached with its banks relating to the 
Company's debtor-in-possession financing of $500.  
Reorganization costs of $10,255 for the year ended June 30, 
1996 were primarily professional fees.

	Under the Plan of Reorganization, all allowed general 
unsecured claims will be satisfied through the distribution 
to holders of such claims of (i) the unsecured class cash of 
approximately $11,330 (less any amounts paid to holders of 
allowed convenience class claims discussed below), and (ii) 
85 percent of the reorganized company's common stock to be 
issued pursuant to the Plan of Reorganization (determined on 
a fully diluted basis not including the effect of the 
exercise of any of the below described warrants). Each holder 
of an allowed general unsecured claim will receive one share 
of the reorganized company's common stock for each ten 
dollars in allowed claim value.  All allowed claims senior to 
allowed general unsecured claims will be satisfied by the 
payment in full in cash or notes (as provided for by the 
Bankruptcy Code) or the assumption of all such claims.  As 
described below, the distributions to holders of allowed 
general unsecured claims and claims senior to such claims 
have commenced.  Allowed convenience class claims (general 
unsecured claims of one thousand five hundred dollars or 
less) have received payment in cash in an amount equal to 60 
percent of the amount of such claims.  In addition, 
registered holders as of August 15, 1996, of the Company's 
common stock, par value $.01 per share, which was outstanding 
prior to the Effective Date (the "Old Common Stock") have 
received warrants to purchase one share of common stock, par 
value $.001 per share (the "Common Stock"), in the 
reorganized company for each twenty shares of Old Common 
Stock.

	During the quarter ended March 31, 1997, the Company 
made a disbursement of $12,474 to the distribution agent for 
payment of allowed general unsecured claims and claims senior 
to such claims.  Once disputed general unsecured claims are 
resolved and allowed, such claimants will share, on a pro 
rata basis, in the aforementioned cash pool as well as in 85 
percent of the Common Stock.  On February 28, 1997 the 
Company recorded a value of approximately $9,900 for 85 
percent of the Common Stock.  In connection with the Plan of 
Reorganization going effective, certain liabilities recorded 
as subject to compromise were retained by the Company and 
approximately $30,496 of such liabilities were settled which 
resulted in a pre-tax and after-tax extraordinary gain of 
approximately $8,122 for the year ended June 30, 1997.  An 
additional gain of $1,174 (pre-tax and after-tax) was 
recorded for the year ended June 30, 1998 as a result of 
favorable resolutions of bankruptcy claims.  As of June 30, 
1998 2,983,022 shares of common stock were issued to allowed 
general unsecured claim holders.  

	Under the Plan of Reorganization, the Company's plans were 
to expand its product line, primarily by sourcing new products 
from outside manufacturers and that effort continues.  Such 
sourcing includes entering into strategic alliances with third 
parties in the United States, Europe and the Far East to 
provide products or services.  In that respect, the Company's 
efforts are focused on forging new and expanding existing 
alliances with companies that provide technologically advanced 
products for the small office and home office environment but 
presently do not have a substantial United States market 
penetration, and are intent on building or increasing market 
penetration by selling their products under the well-known 
"Smith Corona" name.  The Company intends to rely on its 
existing distribution network to become a leading vendor of 
technologically advanced products for the small office and home 
office.  Additionally, the Company is exploring synergistic 
opportunities in related markets that will provide new and 
expand existing channels of distribution.  In the fall of 1997, 
newly sourced and manufactured products were available under 
the Smith Corona brand name. The product offerings include 
items in the telephony and plain paper inkjet facsimile product 
lines.  These new telephony products included a family of 
corded, as well as cordless phones incorporating the latest in 
900 MHz, analog, digital and spread spectrum technology.  In 
fiscal 1999 the Company intends to continue to introduce new 
products for home office and small office applications.  Some 
of the new products will be systems-oriented, and intended to 
increase personal productivity.  Further, the Company 
determined it would maintain its core business of distributing 
its current product line of typewriters and related supplies 
and accessories to satisfy continuing worldwide demand for 
these products.  The Company's long-term viability is dependent 
upon the successful implementation of its reorganization plan 
and the attainment of profitable operations.

3. Inventories

A summary of inventories, by major classification and 
net of reserves, is as follows:
	                                       June 30,      
                                      	1998 	1997

Raw materials and work-in-process	  $    91 	$ 4,961
Finished goods	                      15,308  	 7,666
   Total	                           $15,399 	$12,627

4. Property, Plant and Equipment

		A summary of property, plant and equipment, by major classification, 
is as follows:
                                	      	 June 30,      
	                                       1998 	1997

Land		                               $   730 	$   810 
Buildings and improvements	            1,430  	 6,704 
Machinery and other equipment	        39,009  	57,765 
Total	                                41,169  	65,279 
Accumulated depreciation	            (34,658) (53,187)
   Total	                            $ 6,511 	$12,092 

5. Accrued Liabilities

Accrued liabilities consist of the following:

                                       		June 30,      
	                                       1998	 1997 

Promotional expenses 	                $2,198 	$ 3,940 
Payroll and related expenses	          1,981	   3,297 
Warranty expenses	                       844   	1,067 
Bankruptcy expenses	                      75	   1,762
Other	                                 3,106 	  1,548

     Total	                           $8,204 	$11,614 

6. Leases

The Company leases certain facilities, equipment and 
vehicles for various periods through 2003 under 
non-cancelable operating leases.  Rental expense under 
these operating leases was $1,493, $3,461 and $4,184 for 
the years ended June 30, 1998, 1997 and 1996, 
respectively.

The future minimum rental commitments for the operating 
leases are as follows:
Year Ending	
June 30,	Amount
		 
1999		$  622
2000   		583
2001		   545
2002		    10
2003	 	    6
Thereafter	2
Total	$1,768


	The Company subleases a portion of its San Diego 
distribution facility.  Rental income under this sublease was 
$38 for the year ended June 30, 1998 and will be 
approximately $65 each year until sublease expiration in May 
2001.

7. Bank Loans
 
On February 28, 1997, the Company entered into a loan 
and security agreement (the "Loan and Security 
Agreement") with a new lender.  The Loan and Security 
Agreement provides for extensions of revolving credit 
loans, term loans and letters of credit, limited to a 
percentage of eligible accounts receivable and 
inventories in the amount not to exceed $25,000 through 
the February 28, 2000 expiration date.  Interest is .75 
percent over the Prime Rate or 3 percent over the 
Adjusted Eurodollar Rate.  Payment of dividends is 
prohibited by the terms of the Loan and Security 
Agreement, except for non-cash dividends pursuant to the 
Rights Agreement (as described in Note 8). Pursuant to 
the provisions of the Loan and Security Agreement the 
Company must maintain an adjusted net worth of $11,074. 
 Management believes that it has adequate flexibility 
and that such a covenant should not impose an undue 
restriction on the operations of the Company.  The Loan 
and Security Agreement is secured by all of the 
Company's assets.

There were no borrowings or repayments under the 
Company's credit facilities during the years ended June 
30, 1998 and 1997. However, aggregate borrowings under 
the Company's prior credit facility for the year ended 
June 30, 1996 amounted to $1,330,700, while aggregate 
repayments were $1,348,100.

8. Stockholders' Equity

Common Stock

As of the Effective Date, the Company has authorized 
100,000,000 shares of Common Stock, par value $.001 per 
share.  Prior to the Effective Date the Company had 
authorized 90,000,000 shares of Old Common Stock.

Preferred Stock

As of the Effective Date, the Company has authorized 
10,000,000 shares of preferred stock, par value of $.001 per 
share.  The Company has reserved for issuance 10,000 shares 
of Preferred Stock, Series A, whose terms are fixed by the 
Rights Agreement. 

Rights Agreement

On February 28, 1997, pursuant to the Plan of Reorganization, 
the Board of Directors of the Company declared a dividend 
distribution of one Right for each outstanding share of 
Common Stock, payable to stockholders of record at the close 
of business on such date and payable with respect to Common 
Stock issued thereafter.  Each right, when it becomes 
exercisable, entitles the registered holder to purchase from 
the Company one one-thousandth of a share (a "Unit") of 
Preferred Stock, Series A at a purchase price of $25.50 per 
Unit, subject to adjustment.  The Rights attach to all 
certificates representing shares of Common Stock, and no 
separate certificates evidencing the Rights were distributed. 
 The Rights will separate from the Common Stock and will be 
exercisable upon the earlier of (i) ten days (or such later 
date as the Board of Directors shall determine) following 
public disclosure that a person or group of affiliated or 
associated persons has become an "Acquiring Person" (as 
defined below) or (ii) ten business days (or such later date 
as the Board shall determine) following the commencement of a 
tender offer or exchange offer that would result in a person 
or group becoming an "Acquiring Person".  Except for certain 
claimants under the Plan of Reorganization, for whom the 
percentage is higher, an "Acquiring Person" is a person or 
group of affiliated or associated persons who has acquired 
beneficial ownership of 15 percent or more of the outstanding 
shares of Common Stock.  The term "Acquiring Person" excludes 
(i) the Company, (ii) any subsidiary of the Company, (iii) 
any employee benefit plan of the Company or any subsidiary of 
the Company or (iv) any person or entity organized, appointed 
or established by the Company for or pursuant to the terms of 
any such plan.  The Rights, which do not have voting rights, 
will expire on February 28, 2007 unless extended or earlier 
redeemed by the Company.

In the event that a person becomes an Acquiring Person, 
each holder of a Right will have the right to receive, 
upon exercise of the Right, Common Stock having a value 
equal to two times the exercise price of the Right.  
Rights that are owned by any Acquiring Person will be 
null and void.  In the event that a person has become an 
Acquiring Person and the Company is acquired in a merger 
or other business combination transaction in which the 
Company is not the surviving corporation, or more than 
50 percent of the Company's assets or earning power is 
sold, each holder of a Right (except Rights which 
previously have been voided as set forth above) shall 
thereafter have the right to receive, upon exercise, 
common stock of the acquiring company having a value 
equal to two times the exercise price of the Right.

The Rights may be redeemed by the Company at a price of 
$.001 per Right at any time until ten days following the 
date on which a person has become an Acquiring Person.

Warrants

Also on the Effective Date, the Company issued warrants to 
stockholders of record as of August 15, 1996 of the Old 
Common Stock.  Eligible stockholders received one warrant to 
purchase one share of Common Stock for every 20 shares of the 
Old Common Stock held by them.  The Old Common Stock was 
canceled on the Effective Date.  The exercise price of the 
warrants is $8.50 per share.  The warrants may be exercised 
at any time from August 28, 1997 to February 28, 1999.  As of 
June 30, 1998, there were 1,512,073 warrants outstanding.  In 
the twelve months ended June 30, 1998, 350 warrants were 
exercised.

Restricted Stock

Pursuant to the Plan of Reorganization, the Chief Executive 
Officer, Chief Financial Officer, Executive Vice 
President/Sales and Marketing and at the discretion of the 
Chief Executive Officer, other officers of the Company may be 
granted up to 5 percent of the total shares of Common Stock 
which are issued under the provisions of the Plan of 
Reorganization on a fully diluted basis (not including the 
effect of the exercise of any of the above warrants).  The 
number of shares of the Company's Common Stock awarded and 
outstanding under this plan as of June 30, 1998 and 1997 were 
135,282 and 93,894 respectively.  In the twelve months ended 
June 30, 1998, 41,388 shares were awarded.  Additionally, 
under the provisions of the Employee Stock Incentive Plan (as 
hereinafter described) the Company issued 23,000 shares of 
Common Stock to employees during the twelve months ended June 
30, 1998.  Rights to these shares vest on the second 
anniversary of the Effective Date (the "Restriction Period") 
or upon a change in control.  The market value of these 
shares at the date of award is reflected as deferred 
compensation in Stockholders' Equity and is being amortized 
over the Restriction Period. During the twelve months ended 
June 30, 1998 $251 of compensation expense was recorded.

Employee Stock Incentive Plan

Pursuant to the Plan of Reorganization, the Company 
implemented an employee stock incentive plan, which provides 
for the issuance of up to 10 percent of the total shares of 
Common Stock (or options to acquire such shares) which are 
issued pursuant to the provisions of the Plan of 
Reorganization on a fully diluted basis (not including the 
effect of the exercise of any of the above warrants). As of 
June 30, 1998 23,000 shares of Common Stock (see Restricted 
Stock) and  144,625 options to acquire Common Stock were 
awarded and outstanding under this plan.  Options were 
granted on January 15, 1998 at an exercise price of $6.125, 
the fair market value of the Common Stock at that date.  
Forty percent of the options become exercisable March 1, 1999 
and twenty percent on January 15, 2000, 2001 and 2002.  The 
options expire seven years after the date of grant.  The 
weighted average fair value of options granted in the twelve 
months ended June 30, 1998 was $555 and was estimated by 
using the Black Scholes pricing model.  The assumptions used 
in determining the weighted average fair value options 
included (i) expected life of four years, (ii) risk-free 
interest rate of 5.5 percent, (iii) volatility factor of .813 
and (iv) dividend yield of zero percent.  Had compensation 
cost for the nonqualified stock option been determined based 
on their estimated fair market value at the date of grant, 
the Company's net loss for the twelve months ended June 30, 
1998 would have increased by $64 or $.02 per basic and 
diluted share. 

9. Geographic Area Information

The Company operates predominantly in one industry 
segment which includes marketing and distribution of 
products to the small office and home office markets.  
The products include typewriters and related supplies 
and accessories as well as offerings in the telephony 
and facsimile categories.  The Company distributes its 
products through a variety of distribution channels, 
domestically and internationally.  Transfers between 
geographic areas are generally priced to recover cost 
plus an appropriate markup for profit.  Information 
regarding the Company's operations in different 
geographic locations is shown below:

                                 	For the year ended June 30,
                                 	1998	      1997	      1996
Net sales to customers:		 	 
   United States	             $ 53,306   	$67,918  	$ 90,470
   Europe	                       3,593	     6,848	    17,773
   Other Foreign	                2,025	     2,547	     4,305
      Total	                  $ 58,924	   $77,313	  $112,548
			
Inter-area transfers:			
   United States 	            $  3,293	   $ 5,147	  $ 11,287
   Singapore 	                       -	         -    	22,480
   Europe	                          98	       415	         -
   Other Foreign	                3,860	     8,890	     6,735
      Total	                  $  7,251	   $14,452	  $ 40,502
			
Operating income (loss):			
   United States	             $   (598)	  $ 8,177	  $(14,944)
   Singapore	                     (119)	     (110)	   15,737
   Europe	                      (3,082)	   (4,234)	   (6,461)
   Other Foreign	                 (637)	     (549)	     (730)
   Corporate	                   (4,061)	   (4,142)	   (3,815)
   Eliminations            	         -	         -  	   1,637
      Total	                  $ (8,497)  	$  (858) 	$ (8,576)

Identifiable assets:			
   United States	             $ 42,821	    $51,535	 $ 69,036
   Europe	                       2,675	      3,778	    8,548
   Other Foreign	                4,591	      5,316	    6,288
      Total	                  $ 50,087	    $60,629	 $ 83,872
	
Sales to one of the Company's largest customers, Wal-
Mart Stores, Inc., amounted to 29.7%, 19.8% and 11.4% of 
consolidated net sales during 1998, 1997 and 1996, 
respectively.  Additionally, in 1996, sales to Office 
Depot amounted to 10.1% of consolidated net sales.  The 
above customers were the only customers responsible for 
more than 10% of net sales in the periods noted.

10. Pension Plans and Postretirement Benefits 

    	 On September 1, 1996, the Company discontinued future 
benefit accruals under its salaried defined benefit pension 
plan (the "Salaried Plan") and as of October 6, 1996 
terminated the hourly defined benefit pension plan (the 
"Hourly Plan").   The freezing of benefit accruals resulted 
in a $3,394 curtailment gain recorded in selling, general and 
administrative expenses during the three months ended 
September 30, 1996.
      
The Salaried Plan generally provides pension benefits 
that are based upon formulas that reflect all service 
with the Company and its predecessors and the employee's 
compensation during the employee's highest five of the 
last ten consecutive years of service before retirement. 
 The Hourly Plan generally provides benefits of stated 
amounts for each year of service.   The Company's policy 
has been to fund, at a minimum, the amount necessary on 
an actuarial basis to provide for benefits in accordance 
with requirements of the Employee Retirement Income 
Security Act of 1974 ("ERISA").

     The net periodic pension cost (income) for the years 
ended 
June 30, 1998, 1997 and 1996 is comprised of the following 
components:

                              	1998 	   1997 	  1996 

Service cost	               $   393	$    512	 $1,455
Interest cost	                2,929	   4,185	  5,656
Return on plan assets:			
 Actual	                     (4,657)	 (8,845) (7,347)
 Unrecognized loss	           1,385	   4,162	  1,498
Amortization of deferred
  costs and actuarial gains	      -	       -	   (227)
Settlement gain	                  -	  (8,598)	     -
Net curtailment gain	             -	  (3,394) (1,524)
Pension cost (income)	      $    50	$(11,978)	$ (489)

     The net curtailment gains for 1997 and 1996 were a 
result of the freezing of benefit accruals and the May 1995 
restructuring, respectively. The settlement gain is a result 
of termination of the Hourly Plan and is included as a 
component of the extraordinary gain recorded in 1997.

     The assumptions used in the development of these amounts were:

                             	1998     	1997	    1996

Discount rate	               6.75%	    7.50%	   7.50%
Rates of increase in 	
   compensation levels	      4.50%	    4.50%	   4.50%
Rate of return on	
   plan assets	              9.00%	    9.25%	   9.25%


  The following table sets forth the funded status of the 
Salaried Plan and amounts recognized in the Company's 
consolidated balance sheets: 

                   	         	Year ended June 30,
	                                1998		   1997
Projected benefit obligation	 $45,623		$41,221
Fair value of assets
 (principally publicly traded
  securities)	                $42,841		$42,297
Funded status	                $ 2,782		$(1,076)
Unrecognized gains	             2,045		  5,853
Net accrued pension liability	$ 4,827		$ 4,777


  Summary information on the Company's Salary Plan in the 
year ended June 30, 1998 and Salary Plan and Hourly Plan in 
the year ended June 30, 1997 is as follows:
                                           	Year ended June 30,
                                              	1998	     1997 

Change in Projected Benefit Obligation:
  Benefit obligation at the 
   beginning of the year	                   $41,221	  $78,822
  Service cost	                                 393	      512
  Interest cost	                              2,929	    4,185
  Assumption change	                          5,588	   (4,077)
  Curtailment/Settlement gain	                    -	  (33,419)
  Actuarial (gains) loss                       (395)	   1,361
  Benefits paid                      	       (4,113)	  (6,163)
  Benefit obligation at the end 
   of the year	                             $45,623 	 $41,221


                                         	   Year ended June 30,
                                               	1998	     1997 
Change in Plan Assets:
  Fair value of plan assets at 
   the beginning of the year	                $42,297	  $68,766
  Actual return on plan assets	                4,657	    8,845
  Employer contributions	                          -	      904
  Benefits paid	                              (4,113)	  (6,163)
  Settlement 	                                     -	  (30,055)
  Fair value of plan assets at 
   the end of the year   	                   $42,841	  $42,297
   







		The Company also has defined contribution savings plans 
covering its domestic and certain of its foreign employees, 
under which the Company matches a portion of the 
contributions made by participating employees. The Company's 
costs for matching contributions under savings plans totaled 
$241, $254 and $337 for the years ended June 30, 1998, 1997 
and 1996, respectively.
     
     The Company also provides health care and life insurance 
benefits for certain retired employees.  Substantially all of 
the Company's domestic employees, and certain employees in 
foreign countries, may become eligible for such benefits if 
they reach a specified retirement age while working for the 
Company.

     Effective January 1, 1998 retired employees were 
required to absorb incremental increases in the total cost of 
health care premiums. By January 1, 2000, retired employees 
will absorb 100% of the health care premium.  Furthermore, 
the Company decided to terminate life insurance benefits for 
retired employees effective January 1, 2000.  These changes 
resulted in a net curtailment gain of $6,534 which was 
recorded in selling, general and administrative expenses 
during the fourth quarter of the year ended June 30, 1997.

  Summary information on the Company's postretirement benefit 
plans, which are unfunded, is as follows:

   
                                        	Year ended June 30,
                                          	1998	      1997 

Change in Benefit Obligation:
  Benefit obligation at the 
   beginning of the year	                $1,248	    $9,573
  Service cost	                               -	        83
  Interest cost	                             68	       687
  Participant's contributions	              489	       609
  Curtailment gain	                           -	    (6,534)
  Actuarial gains	                         (223)    (1,896)
  Benefits paid                      	   (1,063)	   (1,274)
  Benefit obligation at the end 
   of the year	                          $  519	    $1,248


                                         	Year ended June 30,
                                          	1998	       1997 

Financial status of plans:
 Accumulated postretirement
  benefit obligation (APBO):		
   Retirees	                             $  519 	    $1,248
   Fully eligible, active
    plan participants	                        -	          - 
   Other active plan
    participants	                             -	          - 
   Unrecognized gains	                    3,327	      4,656
 Accrued postretirement
  benefit cost	                          $3,846	     $5,904

      
     The components of net periodic postretirement benefit
 income are as follows:
                                         Year ended June 30,
                                          	1998	       1997 

Service cost	                           $     -	    $    84
Interest cost 	                              68	        687
Amortization of gains	                   (1,552)	      (164)
Net curtailment gain	                         -	     (6,534)
Net periodic postretirement benefit
 income                                	$(1,484)	   $(5,927)


     The net curtailment gains were primarily the result of 
the change in postretirement benefits in the year ended June 
30, 1997.  

     The discount rate used in determining the APBO was 6.75 
% in 1998 and 7.5% in 1997.  The assumed health care cost 
trend rate used in measuring the accumulated postretirement 
benefit obligation was 9.5% and 10.0% in 1998 and 1997, 
respectively, declining to an ultimate rate of 5.5% to the 
year 2005 and beyond.

     The impact of changing the health care cost trend rate 
assumptions by 1.0% is not material to the plans. 

12. Income Taxes

     The components of loss from continuing operations before income taxes 
are as follows:
                                          	Year ended June 30,  
                                          	1998	    1997 	   1996 

United States	                          $(4,922)	 $3,124	$(21,590)
Foreign                                  (2,512)	 (3,656) 	12,499
   Total	                               $(7,434) 	$ (532)$ (9,091)

     The components of income tax expense consist of:

                                          	Year ended June 30, 
                                          	1998    	1997 	   1996 
United States:
   Current	                               $   - 	  $   -	 $(1,921)
   Deferred	                                  - 	      -	   2,217
Foreign	                                    158	     104	   1,218
State	                                      186	     159	     517
   Total	                                $  344	   $ 263	 $ 2,031



     Income tax expense is included in the financial statements as 
follows:

                                          	Year ended June 30,  
                                          	1998 	   1997 	   1996 

Continuing operations	                   $  344 	   $263 	 $2,031
Extraordinary Gain	                           -	       -	       -
   Total	                                $  344 	   $263 	 $2,031	


The components of net deferred tax assets were as follows: 

                                          		June 30,   
	                                         1998	   1997 
Deferred tax assets:		
  Accounts receivable	                 $   664 	$1,066 
  Inventory	                             2,076 	 1,960 
  Prepaid and other current assets	      2,038 	 2,363 
  Postretirement benefits
   other than pensions	                  1,470 	 2,257 
  Pension	                               1,845 	 1,825 
  Restructuring	                             - 	   469 
  Other liabilities	                     3,902 	 4,050 
  Property, plant and equipment	         1,936 	 3,291 
  Net operating loss carryforwards	     27,253 	21,195 
  Capital loss carryforwards	            7,494  	7,515 
  Miscellaneous 	                        2,163   2,615 
  Valuation allowances                 (50,841)(48,606)
  Net deferred tax assets           	  $     - $     - 

     The valuation allowances for the year ended June 30, 
1998 increased by $2,235 to provide for the full 
valuation of all deferred income tax assets.  For the 
year ended June 30, 1996, the Company recorded a charge 
to income tax expense increasing valuation allowances to 
provide for full valuation of all of its deferred income 
tax assets.
  
	In the consolidated balance sheet for the year ended 
June 30, 1998, refundable taxes of $2,306 are included in 
prepaid expenses and other current assets.  The current 
and long-term portion of a federal tax note payable of 
$848 and $2,366, respectively are included in accrued liabilities 
and other long-term liabilities, respectively, at June 30, 1998.

     The provisions for income taxes differ from the 
amounts computed by applying the federal income tax 
statutory rate. The following is a summary of the reasons 
for these differences:

                                   		Year Ended June 30,  
                                    	1998	    1997 	   1996 
Loss from continuing
  operations before income taxes	 $(7,434)	 $ (532)	$(9,091)
Statutory tax rate	                    34%	     34%	     34%
Tax computed at statutory rate	    (2,527)   	(181)	 (3,091)
Increase (reduction):
State income taxes,
   net of federal benefit             (40)  	2,980     	405
Effect of foreign earnings	         1,059   	1,661	    (930)
Valuation allowance	                2,235  	(6,956)	  8,425
Other adjustments                    (383) 	 2,759	  (2,778)
   Total                         	$   344  	$  263	 $ 2,031


The other adjustments of $2,759 for the year ended June 
30, 1997 resulted primarily from permanent 
capitalization of certain professional services related 
to the Bankruptcy Proceedings for income tax purposes.  
The other adjustments of $2,778 for the year ended June 
30, 1996 primarily relate to adjustments to current 
taxes payable for the results of the Internal Revenue 
Service and New York State tax examinations.

All U.S. income tax returns through June 30, 1995 have 
been examined by the Internal Revenue Service.  
Additionally, the New York State tax authority completed 
its examination of all returns through June 30, 1995.  
The U.S. income tax return for the year ended June 30, 
1996 is currently under examination by the Internal 
Revenue Service.  Management does not expect a material 
adjustment to result from this examination.

For U.S. federal income tax purposes the Company has a 
net operating loss carryforward of approximately $28,759 
which will expire on June 30, 2013.  In addition, the 
Company has net operating losses attributable to its 
foreign subsidiaries of approximately $41,490 of which 
approximately $36,110 may be carried forward 
indefinitely and the remaining amount will expire in 
five to seven years.  The tax benefit of the net 
operating loss carryforwards has been fully offset by 
valuation allowances.

13. Commitments and Other Matters

Certain aspects of the Company's past handling and/or 
disposal of hazardous substances have been the subject 
of investigation by federal and state regulatory 
authorities, or have been the subject of lawsuits filed 
by such authorities or by private parties.  At June 30, 
1998 and June 30, 1997, the Company had recorded 
liabilities of approximately $1,889 and $2,952, 
respectively, related to environmental matters.  Because 
of the uncertainties associated with assessing 
environmental matters, the related ultimate liabilities 
are not presently determinable.  However, based on facts 
presently known, management does not believe that these 
investigations, if resolved adversely to the Company, 
would individually or in the aggregate have a material 
adverse effect on the Company's financial position or 
results of operations.

The Company was the owner and operator of manufacturing 
facilities in Groton, New York (the "Groton Site") and 
Cortlandville, New York (the "Cortlandville Site" and, 
together, the "Owner/Operator Sites").  The Company's 
liability, if any, at the Owner/Operator Sites stems 
from groundwater contamination at the Cortlandville Site 
and soil contamination at the Groton Site. The 
remediation program at the Cortlandville Site currently 
consists of round-the-clock pumping and filtering.  The 
soil venting with a soil infiltration injection system 
at the Groton Site is now reduced to periodic soil and 
water sampling. A decommissioning plan for the Groton 
site has been approved and decommissioning activities 
have commenced.  To the Company's knowledge, the only 
future costs that will be associated with remediation of 
those sites are for operation, maintenance, monitoring, 
shutdown, and post-shutdown of the systems.  Under the 
Plan of Reorganization, the Company will continue to be 
responsible for those costs.  The Company believes that 
it has set aside adequate reserves for the payment of 
expenses for the ongoing remediation programs at the 
Groton and Cortlandville Sites.   

	The Company is also engaged in various other legal 
actions that have arisen in the ordinary course of its 
business.  It is the opinion of management that the ultimate 
resolution of these matters and the environmental matters 
discussed above will not have a material adverse effect on 
the Company's financial position or results of operation.

The Company has severance agreements in place with 
certain executive officers.  Substantially all the 
agreements expire by March 1, 2000 and provide for 
severance benefits of one year salary and aggregate 
approximately $460 in the event all employees under such 
severance agreements were involuntarily terminated. 
Subsequent to June 30, 1998 the Chief Executive Officer 
of the Company terminated employment and was paid under 
his severance agreement.

14. Restructuring Costs

 On May 8, 1995 the Company announced a major 
Restructuring whereby the Company?s typewriter 
manufacturing would be relocated from its Singapore and 
Batam Island, Indonesia facilities to its Mexico 
facility.  This action resulted in the termination of 
approximately 1,300 workers in Singapore and Batam 
Island.  The Company ceased production in Singapore and 
Batam Island, Indonesia in November 1995, and relocated 
equipment to Mexico where typewriter production 
commenced in December 1995.  The Company sold certain of 
its Singapore machinery and equipment for proceeds of 
approximately $2,333 resulting in a loss of 
approximately $1,489 which was accrued as part of the 
Fiscal 1995 restructuring charge.  Additionally, the 
Company sold its Singapore facility and the underlying 
land lease on February 8, 1996 for net proceeds of 
approximately $21,041.  The sale of the facility 
resulted in a third quarter pretax gain of approximately 
$17,755 and is included in restructuring income.

In addition to the relocation of typewriter 
manufacturing to Mexico, the Company also eliminated 
approximately 180 support positions within the research 
and development, finance, service, distribution, selling 
and marketing areas in both its Cortland, New York and 
New Canaan, Connecticut locations.  Approximately 
$10,000 in additional annual pretax savings were 
realized during the year ended June 30, 1997 from 
elimination of these support positions.  These 
reductions were completed by the end of the first 
quarter of Fiscal 1996 and resulted in a first quarter 
pension curtailment gain of approximately $1,524 and 
were included in restructuring expense (income) for the 
third quarter of Fiscal 1996.

As a result of these actions, the Company recorded a 
pretax charge of approximately $14,870 in the fourth 
quarter of the year ended June 30, 1995, of which 
approximately $1,877 represented primarily non-cash 
machinery and equipment asset write-offs, and the 
remainder related to employee severance.  Additionally, 
certain costs, primarily relating to the shutdown of 
Singapore operations, of approximately $1,622, pretax 
were recognized as charges to operations as incurred 
during the year ended June 30, 1996 as they did not 
qualify as restructuring costs. 

15. Quarterly Financial Data (Unaudited)

Fiscal Year Ended	                First     Second     Third     Fourth
June 30, 1998	                    Quarter   Quarter(1) Quarter   Quarter(1)
Net sales	                        $14,792	  $17,005	   $15,096	  $12,031
Gross margin	                       3,251	    4,786	     4,496	    1,009
Operating income (loss)	           (1,502)	   1,552	    (3,177)	  (5,370)
Income (loss) before
 extraordinary gain	               (1,459)   	1,725	    (2,907)	  (5,137)
Extraordinary gain (2)	                 -	      460         	-	      714
Net income (loss)	                $(1,459)	 $ 2,185   	$(2,907)	 $(4,423)

Earnings (loss)per 				
 common share - basic:				
  Income (loss) before
   extraordinary gain	            $  (.55)	 $   .63	   $ (1.02)	 $ (1.75)
  Extraordinary gain	                   -	      .17	         -	      .24
  Net income (loss)	              $  (.55)	 $   .80	   $ (1.02)	 $  (1.51)

Weighted average common 
  shares (000's omitted)	           2,677	    2,708	     2,845	     2,935
 	 
Earnings (loss)per 				
 common share - diluted:				
  Income (loss) before
   extraordinary gain	            $  (.55)	 $   .62	  $ (1.02)	  $ (1.75)
  Extraordinary gain	                   -	      .16	        -	       .24
  Net income (loss)	              $  (.55)	 $   .78	  $ (1.02)	  $  (1.51)

Weighted average common
  shares (000's omitted)	           2,677	    2,793	    2,845	      2,935


Fiscal Year Ended	                First      Second     Third     Fourth
June 30, 1997	                    Quarter(3) Quarter    Quarter   Quarter(4)
Net sales	                        $20,986	   $22,463	   $16,905	  $16,959
Gross margin	                       3,929	     6,112	     2,917	    4,952
Operating income (loss)	               73	    (2,607)	   (3,255)	   4,931
Income (loss) before
 extraordinary gain	                   85	    (2,636)	   (3,186)	   4,942
Extraordinary gain (2)	                 -	         -	     8,122	        -
Net income (loss)	                $    85	   $(2,636)	  $ 4,936	  $ 4,942

Earnings (loss) per common				
 share - basic:				
  Income (loss) before
   extraordinary gain	            $  .04 	   $ (1.19)  	$ (1.44)	 $  1.94
  Extraordinary gain	                  -	          -	      3.67  	      -	
  Net income (loss) 	             $  .04 	   $ (1.19)	  $  2.23	  $  1.94 
   	 
Weighted average common
  shares (000's omitted)(5)	       2,215	      2,215	     2,215	    2,551

Earnings (loss) per common				
 share - diluted:				
  Income (loss) before
   extraordinary gain	           $   .04 	  $ (1.19)	   $ (1.44)	 $  1.89
  Extraordinary gain	                  -	         -	       3.67	        -
  Net income (loss) 	            $   .04 	   $(1.19)	   $  2.23	  $  1.89

Weighted average common
  shares (000's omitted)(5)	       2,215	     2,215	      2,215	    2,610

(1) Includes gain on sale of manufacturing operations for $3,700 and $202 in 
the second and fourth quarters, respectively.
(2) Extraordinary gain resulted from the Company's Plan of Reorganization 
(see footnote 2)
(3) Includes pension curtailment gain of approximately $3,400.
(4) Includes postretirement curtailment gain of approximately $6,500.
(5) For the first, second and third quarters in the fiscal year ended 
    June 30, 1997, the weighted average common and common equivalent
    shares outstanding are based on the weighted average number of
    common shares outstanding from the Effective Date until March 31,
    1997.

16. Subsequent Event

	Effective September 28, 1998, the Company's Board of 
Directors approved a restructuring program which includes: i.) 
the elimination of approximately 130 positions primarily located 
at the Company's Corporate Headquarters in Cortland, New York, 
ii.) the sale or lease of the building in Cortland, New York, 
iii.) relocation of the Corporate Headquarters to more efficient 
facilities.  The Company expects the restructuring program to be 
completed by June 30, 1999.  As a result of these actions, the 
Company will record a first quarter pre-tax charge, principally 
for severance payments, of approximately $1,200.

Financial Statement Schedule II

SMITH CORONA CORPORATION AND SUBSIDIARIES
VALUATION AND QUALIFYING ACCOUNTS
For the years ended June 30, 1998, 1997 and 1996
(In thousands)



                              				Balance at
                                 	Beginning	   Costs and	Reductions-   	End of
                                 	of Period 	  Expenses	  Writeoffs	    Period

Year ended June 30, 1998:
 Allowance for doubtful		
   trade receivables	             $   931	     $    51	    $    344	    $   638
 Allowance for inventory
   obsolescence and shrinkage	    $ 5,415 	    $ 1,056 	   $  1,460	    $ 5,011

Year ended June 30, 1997:
 Allowance for doubtful		
   trade receivables	             $ 1,576	     $   394	    $  1,039	    $   931
 Allowance for inventory
   obsolescence and shrinkage	    $ 7,552	     $ 2,364	    $  4,501	    $ 5,415

Year ended June 30, 1996:
 Allowance for doubtful
   trade receivables	             $ 1,484	     $  523	      $    431	   $ 1,576
 Allowance for inventory
   obsolescence and shrinkage	    $10,595	     $5,199	      $  8,242	   $ 7,552

 


EXHIBIT INDEX
EXHIBIT #

10.18	Smith Corona Corporation Stock Incentive Plan
21	Schedule of Subsidiaries of the Registrant
27	Financial Data Schedule (Edgar Filing Only)

11