<PAGE>
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                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
 
                             WASHINGTON, D.C. 20549
 
                            ------------------------
 
                                   FORM 10-Q
 
                QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
 
<TABLE>
<S>                                            <C>
       FOR THE QUARTERLY PERIOD ENDED                     COMMISSION FILE NUMBER
              DECEMBER 31, 1996                                   0-20839
</TABLE>
 
                            ------------------------
 
                            DUPONT PHOTOMASKS, INC.
 
             (Exact name of registrant as specified in its charter)
 
<TABLE>
<S>                             <C>
           DELAWARE                74-2238819
 (State or Other Jurisdiction   (I.R.S. Employer
     of Incorporation or         Identification
        Organization)                 No.)
</TABLE>
 
                                100 TEXAS AVENUE
                            ROUND ROCK, TEXAS 78664
 
                    (Address of principal executive offices)
 
        Registrant's telephone number, including area code: 512-310-6559
 
                            ------------------------
 
    Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes /X/  No / /
 
    As of January 22, 1997, 15,100,000 shares of the registrant's common stock,
$.01 par value, were outstanding.
 
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<PAGE>

                                 TABLE OF CONTENTS
                                                                     PAGE
                                                                     ----
PART I


       Item 1.        Financial Statements

               Income Statement for the Three Months Ended December  
               31, 1995, Pro Forma Income Statement for the Three 
               Months Ended December 31, 1995 and Income Statement
               for the Three Months Ended December 31, 1996            3

               Income Statement for the Six Months Ended December  
               31, 1995, Pro Forma Income Statement for the Six 
               Months Ended December 31, 1995 and Income Statement
               for the Six Months Ended December 31, 1996              4

               Balance Sheet at June 30, 1996 and December 31, 1996    5

               Statement of Cash Flows for the Six Months Ended 
               December 31, 1995 and 1996                              6

               Notes to Financial Statements                           7


       Item 2.        Management's Discussion and Analysis of
                      Financial Condition and Results of Operations    8

PART II


       Item 1.        Legal Proceedings                               13


       Item 2.        Changes in Securities                           13


       Item 3.        Defaults Upon Senior Securities                 13


       Item 4.        Submission of Matters to a Vote of Security
                      Holders                                         13


       Item 5.        Other Information                               14


       Item 6.        Exhibits and Reports on Form 8-K                14


                      Signatures                                      15

<PAGE>

                            DUPONT PHOTOMASKS, INC. AND SUBSIDIARIES
                                       INCOME STATEMENT  
                     (DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
                                         (UNAUDITED)
<TABLE>
                                                                 Pro Forma  
                                                                  for the    
                                               Three Months     Three Months    Three Months
                                                   Ended           Ended           Ended    
                                                December 31,    December 31,    December 31,
                                                   1995            1995            1996
                                                   ----            ----            ----
<S>                                               <C>             <C>            <C>
Sales                                             $50,279         $50,279        $64,260
Cost of goods sold                                 31,151          30,733         39,248
Selling, general and administrative expense         6,316           6,437          7,661
Research and development expense - net              2,450           2,038          2,933
Other operating expense - net                       1,614           1,475            456
                                                  -------         -------        -------

Operating profit                                    8,748           9,596         13,962
Interest (income) expense - net                     1,634              48           (296)
Exchange (gain) loss                                   78             (68)            97
                                                  -------         -------        -------

Income before income taxes and minority interest    7,036           9,616         14,161
Provision for income taxes                            472           3,366          4,962
                                                  -------         -------        -------

Income before minority interest                     6,564           6,250          9,199
Minority interest in loss of majority owned 
 joint venture                                                                      (234)
                                                  -------         -------        -------

Net income                                        $ 6,564         $ 6,250        $ 9,433  
                                                  -------         -------        -------
                                                  -------         -------        -------

Earnings per share                                                $  0.41        $  0.61
                                                                  -------        -------
                                                                  -------        -------

Weighted average shares outstanding                            15,194,913     15,588,952
                                                               ----------     ----------
                                                               ----------     ----------
</TABLE>

             The accompanying notes are an integral part of this statement.

<PAGE>

                                DUPONT PHOTOMASKS, INC. AND SUBSIDIARIES
                                            INCOME STATEMENT  
                             (DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
                                              (UNAUDITED)
<TABLE>
                                                                        Pro Forma  
                                                                         for the    
                                                          Six Months    Six Months       Six Months  
                                                            Ended          Ended            Ended    
                                                         December 31,   December 31,    December 31,
                                                             1995           1995            1996
                                                             ----           ----            ----
<S>                                                         <C>           <C>             <C>
Sales                                                       $96,318       $96,318         $128,504
Cost of goods sold                                           63,343        62,507           78,187
Selling, general and administrative expense                  12,185        12,427           15,971
Research and development expense - net                        4,908         4,083            5,371
Other operating expense - net                                 2,247         1,969            1,273
                                                            -------       -------         --------
Operating profit                                             13,635        15,332           27,702  
Interest (income) expense - net                               3,466            94             (496)
Exchange loss                                                   308            53              401 
                                                            -------       -------         --------
Income before income taxes and minority interest              9,861        15,185           27,797
Provision for income taxes                                      926         5,315            9,735
                                                            -------       -------         --------
Income before minority interest                               8,935         9,870           18,062
Minority interest in loss of majority owned joint venture       (55)          (55)            (386)
                                                            -------       -------         --------
Net income                                                  $ 8,990       $ 9,925         $ 18,448
                                                            -------       -------         --------
                                                            -------       -------         --------
Earnings per share                                                        $  0.65         $   1.19
                                                                          -------         --------
                                                                          -------         --------
Weighted average shares outstanding                                    15,194,913       15,517,302
                                                                       ----------       ----------
                                                                       ----------       ----------
</TABLE>

              The accompanying notes are an integral part of this statement.
<PAGE>

                            DUPONT PHOTOMASKS, INC. AND SUBSIDIARIES
                                          BALANCE SHEET
                        (DOLLARS IN THOUSANDS, EXCEPT PAR VALUE AMOUNTS)
                                           (UNAUDITED)

<TABLE>
                                                                   June 30,           December 31,
                                                                     1996                1996 
                                                                     ----                ----
<S>                                                                <C>                 <C>
ASSETS

Current assets:
       Cash and cash equivalents                                   $ 20,179            $ 31,115 
       Accounts receivable, trade - net                              32,293              33,490 
       Accounts receivable, related parties                           4,726               5,762 
       Inventories                                                   10,227              14,220 
       Deferred income taxes                                          1,543               2,004 
       Prepaid expenses and other current assets                      3,238               4,501 
                                                                   --------            --------
         Total current assets                                        72,206              91,092 
Property and equipment - net                                        123,048             130,177 
Accounts receivable, related parties                                  1,928               1,703 
Deferred income taxes                                                 3,245               3,492 
Other assets                                                         27,466              43,272 
                                                                   --------            --------
         Total assets                                              $227,893            $269,736 
                                                                   --------            --------
                                                                   --------            --------
LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
       Accounts payable, trade                                   $    8,376          $   13,254 
       Accounts payable, related parties                              5,885               3,602 
       Accounts payable, other                                        2,006               4,630 
       Short-term borrowings                                          1,454               1,498 
       Income taxes payable                                           2,333               1,578 
       Other accrued liabilities                                     17,694              17,081 
                                                                   --------            --------
         Total current liabilities                                   37,748              41,643 
Long-term borrowings                                                  9,324               9,149 
Deferred income taxes                                                11,588              18,040 
Other liabilities                                                     3,747               2,227 
Minority interest in net assets of majority owned joint venture         872               1,204 
Commitments and contingencies                               
Stockholders' equity:
       Common stock, $.01 par value; 25,000,000 shares authorized;
         15,100,000 issued and outstanding                              151                 151 
       Additional paid-in capital                                   152,880             156,625 
       Unrealized holding gain                                       11,583              22,249 
       Retained earnings                                                                 18,448 
                                                                   --------            --------
         Total liabilities and stockholders' equity                $227,893            $269,736 
                                                                   --------            --------
                                                                   --------            --------
</TABLE>

         The accompanying notes are an integral part of this statement.
<PAGE>
                                       
                   DUPONT PHOTOMASKS, INC. AND SUBSIDIARIES
                            STATEMENT OF CASH FLOWS
                             (DOLLARS IN THOUSANDS)
                                  (UNAUDITED)

                                                               Six Months
                                                                  Ended
                                                              December 31,
                                                            1995        1996 
                                                          --------    --------
Cash flows from operating activities:
     Net income                                           $  8,990    $ 18,448 
     Adjustments to reconcile net income to 
       net cash provided by operations:
            Depreciation and amortization                   14,042      12,775 
            Other                                               87        (671)
            Cash provided (used) by changes in 
              assets and liabilities
                   Accounts receivable                       2,123      (2,304)
                   Inventories                                (542)     (4,046)
                   Prepaid expenses and other 
                     current assets                            984        (536)
                   Accounts payable                         (3,067)      8,470
                   Other accrued liabilities                 4,265       2,142
                                                          --------    --------

            Net cash provided by operating activities       26,882      34,278
                                                          --------    --------

Cash flows from investing activities:
     Capital expenditures                                   (5,163)    (22,814)
     Payments for acquisitions                              (4,000)
     Other                                                      15             
                                                          --------    --------

            Net cash used in investing activities           (9,148)    (22,814)
                                                          --------    --------

Cash flows from financing activities:
     Increase in borrowings                                  2,668          18 
     Cash paid to DuPont - net                             (20,828)            
                                                          --------    --------

            Net cash provided by (used in) 
              financing activities                         (18,160)         18 
                                                          --------    --------

Effect of exchange rate changes on cash                       (312)       (546)
                                                          --------    --------

Net (decrease) increase in cash and cash equivalents          (738)     10,936 
Cash and cash equivalents at beginning of period             8,412      20,179 
                                                          --------    --------

Cash and cash equivalents at end of period                $  7,674    $ 31,115 
                                                          --------    --------
                                                          --------    --------



         The accompanying notes are an integral part of this statement.
<PAGE>
                                       
                    DUPONT PHOTOMASKS, INC. AND SUBSIDIARIES
                         NOTES TO FINANCIAL STATEMENTS
                             (DOLLARS IN THOUSANDS)


NOTE 1 - BASIS OF PRESENTATION

The accompanying unaudited interim financial statements of DuPont Photomasks, 
Inc. and its subsidiaries (the Company) have been prepared pursuant to the 
rules and regulations of the Securities and Exchange Commission.  
Accordingly, certain information and footnote disclosures normally included 
in financial statements prepared in accordance with generally accepted 
accounting principles have been condensed or omitted.  These financial 
statements should be read in conjunction with the audited financial 
statements and accompanying notes thereto included in the Company's 1996 
Annual Report on Form 10-K.  The unaudited interim financial statements 
include all adjustments, consisting only of normal recurring adjustments, 
which management considers necessary for the fair presentation of the interim 
periods. Results for interim periods are not necessarily indicative of 
results for the year. 


NOTE 2 - INVENTORIES

     Inventories consist of the following:

                                                  June 30,    December 31,
                                                    1996           1996   
                                                  -------     ------------

     Raw materials and supplies                   $ 7,006        $11,674 
     Work-in-process                                  785            679 
     Finished product                               2,436          1,867 
                                                  -------        -------
     Inventories                                  $10,227        $14,220 
                                                  -------        -------
                                                  -------        -------


NOTE 3 - COMMITMENTS AND CONTINGENCIES

The Company has various purchase commitments incident to the normal course of 
business including non-refundable deposits to purchase equipment.  In the 
aggregate, such commitments are not at prices in excess of current market.  
The Company is subject to litigation in the normal course of business.  
Management believes the effect, if any, of an unfavorable settlement of such 
litigation would not have a material adverse effect on the financial 
position, results of operations, cash flows or liquidity of the Company.


NOTE 4 - SUBSEQUENT EVENT

Between January 20 and 23, 1997, the Company sold its entire investment in 
Etec Systems, Inc. common stock.  Aggregate net proceeds from the sale of 
$39,219 will be used in operations.


<PAGE>

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


The following discussion and analysis of the financial condition and results 
of operations should be read in conjunction with the financial statements of 
the Company and the related notes thereto.  Prior to the Company's initial 
public offering (the IPO) on June 13, 1996, it was a wholly-owned subsidiary 
of E.I. duPont de Nemours and Company (DuPont).  The Company's historical 
results prior to the IPO are not necessarily indicative of the results that 
would have been achieved if the Company had been independent and may not be 
an accurate indication of future results.  

The pro forma income statement estimates the effects of certain events 
associated with the IPO as if such events had taken place on July 1, 1995.  
The pro forma income statement does not purport to represent what the results 
of operations of the Company would actually have been had certain events in 
fact occurred on July 1, 1995 or to project the results of operations of the 
Company for any future period.

RESULTS OF OPERATIONS


SALES

Sales are comprised primarily of photomask sales to semiconductor 
manufacturers.  Sales increased 27.8% from $50.3 million in the quarter ended 
December 31, 1995 to $64.3 million in the quarter ended December 31, 1996.  
Sales in North America, Europe and Asia increased from $30.6 million, $11.7 
million, and $8.0 million in the quarter ended December 31, 1995 to $35.7 
million, $14.8 million, and $13.8 million in the quarter ended December 31, 
1996.  The quarter ended December 31, 1996 includes $0.7 million of sales 
which are a consequence of realignment of a subsidiary's period end.  Sales 
increased 33.4% from $96.3 million in the six months ended December 31, 1995 
to $128.5 million in the six months ended December 31, 1996.  Sales in North 
America, Europe and Asia increased from $57.1 million, $23.1 million, and 
$16.1 million in the six months ended December 31, 1995 to $71.1 million, 
$30.1 million, and $27.3 million in the six months ended December 31, 1996.  
A continued increase in the demand for advanced photomasks which have higher 
average selling prices was a primary contributor to the increase in sales 
during these periods.  This shift in demand reflects what the Company 
believes to be a trend toward higher utilization of complex semiconductor 
devices with finer line-widths.  The increase in sales during these periods 
also reflects the overall increase in demand for photomasks.

COST OF GOODS SOLD

Cost of goods sold consists of material, labor, depreciation, and overhead.  
Cost of goods sold increased 26.0% from $31.2 million in the quarter ended 
December 31, 1995 to $39.2 million in the quarter ended December 31, 1996 and 
increased 23.4% from $63.4 million in the six months ended December 31, 1995 
to $78.2 million in the six months ended December 31, 1996, resulting 
primarily from higher costs associated with increased sales.  As a percentage 
of sales, cost of goods sold decreased from 62.0% in the quarter ended 
December 31, 1995 to 61.1% in the quarter ended December 31, 1996 and from 
65.8% in the six months ended December 31, 1995 to 60.8% in the six months 
ended December 31, 1996.  The percentage decrease was primarily due to 
continued improvements in capacity utilization including increased use of 
internally sourced photoblanks and pellicles.  

SELLING, GENERAL AND ADMINISTRATIVE EXPENSE

Selling, general and administrative expense includes salaries of sales 
personnel, marketing expense, general and administrative expense, and product 
distribution expense.  Prior to January 1, 1996, general and administrative 
expense principally included allocated costs for services provided by 
centralized DuPont organizations.  The allocated costs are not necessarily 
indicative of the costs that would have been incurred if the Company had been 


<PAGE>

independent.  Since January 1, 1996, general and administrative expense has 
included fees incurred by the Company under Administrative Service Agreements 
with DuPont.  Selling, general and administrative expense as a percentage of 
sales decreased from 12.6% in the quarter ended December 31, 1995 to 11.9% in 
the quarter ended December 31, 1996 and decreased from 12.6% in the six 
months ended December 31, 1995 to 12.4% in the six months ended December 31, 
1996.  Selling, general and administrative expense increased 21.3% from $6.3 
million in the quarter ended December 31, 1995 to $7.7 million in the quarter 
ended December 31, 1996 and increased 31.1% from $12.2 million in the six 
months ended December 31, 1995 to $16.0 million in the six months ended 
December 31, 1996.  The increase was due largely to increases in selling 
expenses corresponding to increased sales and increases in incentive 
compensation expenses corresponding to increases in earnings.  

RESEARCH AND DEVELOPMENT EXPENSE

Research and development expense consists primarily of employee costs, cost 
of material consumed, depreciation of equipment, engineering related costs, 
and the Company's allocated share of DuPont's central research and 
development.  These allocations were $0.5 million in the quarter ended 
December 31, 1995 and were $1.1 million in the six months ended December 31, 
1995.  Such allocations terminated December 31, 1995.  Since that time, the 
Company has received services from DuPont central research and development 
pursuant to Administrative Service Agreements with DuPont.  Research and 
development expense, excluding DuPont allocations, increased from $1.9 
million in the quarter ended December 31, 1995 to $2.9 million in the quarter 
ended December 31, 1996 and increased from $3.8 million in the six months 
ended December 31, 1995 to $5.4 million in the six months ended December 31, 
1996.  Research and development expense is net of funds the Company received 
from customers, industry groups such as SEMATECH Inc. and the Joint European 
Submicron Strategic Initiative and government sources.  The Company 
anticipates that research and development expense will continue to increase 
in absolute terms in the future reflecting the Company's strategy of 
advancing its technological leadership.  However, there can be no assurance 
that such expenditures will enable the Company to develop new technologies or 
to maintain its technological leadership.

OTHER OPERATING EXPENSE

Other operating expense consists primarily of costs not directly related to 
the manufacture of the Company's products. Historically, a significant 
portion of this item has been the expense associated with the early 
retirement of equipment resulting from technological obsolescence.  The 
photomasks industry is characterized by rapid technological change and new 
product introductions and enhancements which may, in the future, result in 
additional technological obsolescence.  The timing and amounts of these 
retirements are uncertain and difficult to predict.  Other operating expense 
decreased from $1.6 million in the quarter ended December 31, 1995 to $0.5 
million in the quarter ended December 31, 1996 and decreased from $2.2 
million in the six months ended December 31, 1995 to $1.3 million in the six 
months ended December 31, 1996.  The decreases were primarily related to 
reduced early retirement of equipment which was partially offset by increased 
pre-operating losses from the Company's joint venture in China and the 
Company's greenfield site in Scotland.

INTEREST (INCOME) EXPENSE 

Interest expense was $1.6 million in the quarter ended December 31, 1995 and 
interest income was $0.3 million in the quarter ended December 31, 1996 and 
interest expense was $3.5 million in the six months ended December 31, 1995 
and interest income was $0.5 million in the six months ended December 31, 
1996 .  The primary source of interest expense in the periods ended December 
31, 1995 was the Company's master note arrangements with DuPont. On June 28, 
1996, DuPont contributed the $90.5 million balance outstanding on the master 
notes to the Company as a capital contribution.  Interest income results from 
short-term investment of the Company's cash balances. 

EXCHANGE LOSS

Exchange loss consists of gains and losses resulting from the remeasurement 
of the Company's accounts denominated in non-U.S. currencies into U.S. 
Dollars, which is the Company's functional currency.   Exchange

<PAGE>

loss was $0.1 million in the quarter ended December 31, 1995 compared to $0.1 
million in the quarter ended December 31, 1996 and was $0.3 million in the 
six months ended December 31, 1995 compared to $0.4 million in the six months 
ended December 31, 1996 primarily due to fluctuations of the U.S. Dollar 
against the German Mark, French Franc and Korean Won. Exchange loss is net of 
the impact of hedging activities designed to reduce exchange rate exposure.

PROVISION FOR INCOME TAXES 

Prior to the IPO, tax expense was determined and allocated to the Company by 
applying the separate taxpayer approach outlined in FAS 109.  Under this 
approach, the Company had net operating loss carryforwards in the U.S. and 
Europe some of which became fully utilized during the year ended June 30, 
1996. The Company's operations in Korea are subject to a government granted 
tax exemption. The Company will continue to enjoy the full benefits of the 
tax exemption in Korea until 2001 and a partial benefit thereafter until the 
tax exemption terminates in 2003.  In actuality, the Company's results were 
included in consolidated tax returns filed by DuPont and the tax benefit of 
prior year losses was realized by DuPont.  Since the IPO, tax expense has 
been determined in accordance with FAS 109 and approximates the U.S. 
statutory rate. 

MINORITY INTEREST IN LOSS OF MAJORITY OWNED JOINT VENTURE 

The minority interest impact of the Company's joint venture in China was 
($0.1 million) in the six months ended December 31, 1995 compared to ($0.4 
million) in the six months ended December 31, 1996, reflecting increased 
pre-operating losses from, and partner funding of, the joint venture.

LIQUIDITY AND CAPITAL RESOURCES

The Company's working capital was $34.5 million at June 30, 1996 and $49.4 
million at December 31, 1996.  The increase in working capital for the six 
months ended December 31, 1996 is due principally to higher cash balances.  
Cash and cash equivalents were $20.2 million at June 30, 1996 and $31.1 
million at December 31, 1996. The increase in 1996 was primarily due to the 
Company retaining a portion of the cash generated from operations.  The 
Company's ongoing cash requirement will be for capital expenditures, research 
and product development, and working capital.

Cash provided by operations was $26.9 million in the six months ended 
December 31, 1995 and $34.3 million in the six months ended December 31, 
1996. The increase was primarily the result of higher sales and resultant net 
income. The Company believes that cash provided by operations will be its 
primary source of liquidity.  Cash used in investing activities was $9.1 
million in the six months ended December 31, 1995 and $22.8 million in the 
six months ended December 31, 1996.  The Company's most significant use of 
cash for investing activities was capital expenditures.  The Company expects 
capital expenditures for the remainder of the year ended June 30, 1997 will 
be approximately $22 to $28 million.  These capital expenditures will be used 
primarily to expand the Company's manufacturing capacity and advance the 
Company's technical capability.  Cash used in financing activities was $18.2 
million in the six months ended December 31, 1995 and $0.0 million in the six 
months ended December 31, 1996.  Prior to the IPO, the Company participated 
in DuPont's centralized cash management system whereby substantially all of 
the net cash generated by the Company was transferred, principally via the 
master notes, to DuPont. 

The Company and DuPont have entered into a two-year credit agreement 
effective as of January 1, 1996 pursuant to which DuPont has agreed to 
provide a revolving credit/working capital facility to the Company in an 
aggregate amount of $30.0 million. The credit facility serves as a back-up to 
cash from operations. To date, there have been no borrowings under credit 
facility. There can be no assurance that alternative sources of financing 
will be available upon expiration of the credit facility or that alternative 
sources of funding will be available if the Company's borrowing requirements 
exceed the facility.  The credit agreement contains, among other things, 
covenants restricting the Company's ability to incur additional debt.  In 
addition, there can be no assurance that, even if funding is available, the 
terms thereof will be attractive to the Company.


<PAGE>

OTHER MATTERS

The Company has negotiated an agreement with three other companies that 
resulted in the formation of a limited liability company that will pursue 
development of advanced photomask fabrication technologies.  The Company 
believes that, through its participation, it will be able to help meet the 
future technology needs of the semiconductor industry for advanced 
photomasks. There can be no assurance that the limited liability company will 
yield results that are favorable to the Company. 

Non-U.S. operations are subject to certain risks inherent in conducting 
business abroad, including price and currency exchange controls, fluctuation 
in the relative value of currencies, and restrictive governmental actions.  
Changes in the relative value of currencies occur from time to time and may, 
in certain instances, have a material effect on the Company's results of 
operations.  The financial statements reflect remeasurement of items 
denominated in non-U.S. currencies to U.S. Dollars, the Company's functional 
currency.   Exchange gains or losses are included in  income in the period in 
which they occur.  Prior to the IPO, DuPont managed the Company's exposure to 
fluctuations in currency exchange rates as part of its overall management of 
exchange rate exposure.  No separate hedging of the Company's exchange rate 
exposure was undertaken.  Accordingly, the financial statements prior to the 
IPO do not reflect any hedging activities.  Effective with the completion of 
the IPO, the Company monitors its exchange rate exposure and attempts to 
reduce such exposure by hedging.  In July 1996, the Company entered into a 
Korean Won forward contract designed to reduce such exposure.  There can be 
no assurance that such forward contract or any other hedging activity will be 
adequate to eliminate, or even mitigate, the impact of the Company's exchange 
rate exposure.  The risks associated with non-U.S. operations have not, to 
date, had a material adverse impact on the Company's liquidity and results of 
operations.  There can, however, be no assurance that such risks will not 
have a material adverse impact on the Company's liquidity and results of 
operations in the future.  

Inflation impacts the Company through increases in the cost of labor, 
services, and raw materials.  In general, these increases have been mitigated 
by periodic increases in the prices of the Company's products.

DISCUSSION OF PRO FORMA

The pro forma income statement estimates the effects that the IPO, various 
realignment transactions, and the following would have had on the Company's 
results of operations had they occurred as of July 1, 1995:  (i) the 
discontinuance of DuPont's postretirement benefits and replacement of 
DuPont's defined benefit pension plan with the Company's defined contribution 
pension plan; (ii) the elimination of DuPont allocated overhead expenses that 
are not expected to be incurred by the Company following the IPO; (iii) the 
cost of services to be provided by third parties or DuPont, pursuant to 
Administrative Service Agreements with DuPont and its subsidiaries, and 
additional employees assumed to be hired by the Company to replace those 
services previously provided by DuPont; and (iv) recognition of expenses 
relating to the Company's stock performance plan.  The principal effect of 
these adjustments would have been a decrease in costs of goods sold of $0.8 
million for the six months ended December 31, 1995.  In addition, selling, 
general and administrative expense would have increased by $0.2 million and 
research and development expense would have decreased $0.8 million.  As a 
result of these adjustments, operating profit would have increased by $1.7 
million for the six months ended December 31, 1995.  Furthermore, elimination 
of the master notes would have decreased interest expense by $3.4 million. 
Consequently, net income (offset by an increase in the provision for income 
taxes) would have increased by $0.9 million for the six months ended December 
31, 1995.

FORWARD LOOKING STATEMENTS

The discussion in this document contains analysis or trends and other forward 
looking statements within the meaning of Section 27A of the Securities Act of 
1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as 
amended.  These statements involve management assumptions and are subject to 
risks and uncertainties, including the risk factors set forth below which are 
fully described in the Company's Annual Report on Form 10-K in

<PAGE>

"Business - Risk Factors" pages 10 to 13: (i) capital intensive industry, 
(ii) rapid technological change, (iii) relationship with and dependence on 
semiconductor industry, (iv) concentration of customers, (v) concentration of 
and dependence on suppliers, (vi) competition; reversal of consolidation 
trend, (vii) significant international operations, (viii) dependence on 
management and technical personnel, (ix) control by and relationship with 
DuPont, (x) no independent operating history prior to the IPO, (xi) 
intellectual property, (xii) fluctuations in quarterly and annual earnings 
and (xiii) changes in governmental laws and regulations.         


<PAGE>
                                    PART II

Item 1. Legal Proceedings

        The Company is not currently involved in any material legal proceedings.

Item 2. Changes in Securities

        Not applicable

Item 3. Defaults Upon Senior Securities

        Not applicable

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

        The Company's Annual Meeting of Stockholders was held October 28, 
        1996 (the "Annual Meeting").  At the Annual Meeting, (i) the 
        Company's nine existing directors were reelected to the Board of 
        Directors and (ii) the selection of Price Waterhouse LLP as the 
        Company's independent accountants for the year ended June 30, 1997 
        was ratified.  Votes cast at the Annual Meeting are as follows:

                                                For     Withheld
                                                ---     --------
           J. Michael Hardinger          14,344,366       17,650
           John L. Doyle                 14,344,366       17,650
           John C. Hodgson               14,344,366       17,650
           Charles O. Holliday           14,344,366       17,650
           Peter G. Kehoe                14,344,366       17,650
           Gary W. Pankonien             14,344,366       17,650
           John C. Sargent               14,344,366       17,650
           Marshall C. Turner            14,344,366       17,650
           Susan A. Vladuchick           14,344,366       17,650

                                                For      Against        Abstain
                                                ---      -------        -------
           Ratification of the selection
            of Price Waterhouse LLP      14,353,816        5,300          2,900

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Item 5. Other Information                                           

        Between January 20 and 23, 1997, the Company sold its entire 
        investment in Etec Systems, Inc. ("Etec") common stock.  Aggregate 
        net proceeds from the sale of $39,219,297 will be used in 
        operations.  The 1,025,640 shares of common stock were sold by the 
        Company in open market transactions on the Nasdaq National Market 
        System.  Etec is the Company's principal supplier of electron beam 
        and laser beam systems.     

Item 6. Exhibits and Reports on Form 8-K

        (A)  Exhibits

             (11) Statement re Computation of Per Share Earnings
             (27) Financial Data Schedule

        (B)  Reports on Form 8-K

        Form 8-K, dated October 2, 1996, filed in connection with the 
        Company's announced technology venture for advance photomask 
        technology development and pilot line fabrication of leading-edge 
        photomasks. 

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                                  SIGNATURES

     Pursuant to the requirements of the Securities and Exchange Act of 1934, 
the registrant has duly caused this report to be signed on its behalf by the 
undersigned thereunto duly authorized.


                                        DUPONT PHOTOMASKS, INC.
                                        (Registrant)


Date: January 29, 1997              By:   /s/ J. MICHAEL HARDINGER    
                                       ---------------------------------------

                                              J. Michael Hardinger
                                              Chairman of the Board and
                                              Chief Executive Officer
                                              (Principal Executive Officer)


Date: January 29, 1997              By:   /s/ DAVID S. GINO     
                                       ---------------------------------------

                                              David S. Gino
                                              Executive Vice President - Finance
                                              and Chief Financial Officer
                                              (Principal Financial and
                                              Accounting Officer)