SECURITIES AND EXCHANGE COMMISSION
                     WASHINGTON, DC   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 December 31, 1997
 __
|__| Transition report pursuant to Section 13 or 15(d) of the Securities Act
      of 1934
          For the transition period from ___________ to _________________

Commission file number 1-1212
                     DRIVER-HARRIS COMPANY
----------------------------------------------------------------------
     (Exact name of registrant as specified in its charter)
            New Jersey                                      22-0870220
-------------------------------------------             ------------------
    (State or other jurisdiction of                      (I.R.S. Employer
     incorporation or organization)                     Identification No.)

308 Middlesex Street, Harrison, NJ                            07029
-------------------------------------------             ---------------------
(Address of principal executive offices)                    (Zip Code)

Registrant's telephone number, including area code         (973) 483-4802
                                              -------------------------------
Securities registered pursuant to Section 12(b) of the Act:
                                             Name of each exchange
          Title of each class:               on which registered:
          -----------------------           -----------------------------
          Common stock - par                 American Stock Exchange
           Value $0.83 1/3

Securities registered pursuant to Section 12(g) of the Act:           NONE

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
shorted period that the Registrant was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days.
        Yes _X_         NO ___

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

The aggregate market value of the voting stock held by non-affiliates and
the total number of common shares outstanding as of March 16, 1998:
     Market Value - $ 13,047,167          Common Stock - 1,340,421 Shares

DOCUMENTS INCORPORATED BY REFERENCE.
Portions of the annual proxy statement anticipated to be filed on or about
April 29, 1998 are incorporated into Part III.
<PAGE>
                             PART I
Item 1.   Business
     (a)  General Development of Business

The Company is engaged in the business of manufacturing and marketing non-
ferrous metal products, principally insulated electrical wire and cable
through its wholly owned subsidiary, Irish Driver-Harris Co. Ltd., located
in Ireland and the U.K.

In 1994, the Company restructured its operations whereby the Company
transferred its overseas resistance operations to Harrison Alloys, Inc. as
well as its U.S. operating subsidiary in exchange for an increase to 50% of
the Company's ownership of Harrison.

In February 1996, Harrison sold its foreign operations to Kanthal AB, a
Swedish company, and used a portion of the proceeds to repay a bank loan
($2,529,000) which the Company had guaranteed.

In September 1997, the Company sold its 50% interest in Quality Heat
Treatment Pty. Ltd.,a company in the furnace manufacturing and heat treating
business, located in Australia, for a net profit of $128,000.

b)  Financial Information About Industry Segments

For the three years ended December 31, 1997, the Registrant operated in a
single industry segment, metal products.

(c)  Narrative Description of Business

  (i)  The principal products manufactured by the Registrant and its
subsidiaries are insulated electrical wire and cable.  These products are
sold principally to the construction, appliance, and electrical equipment
industries by the Company's sales staff and through agents.

     The following represents a breakdown of the Registrant's total net
sales for the last three fiscal years (in thousands):
<TABLE>

                    Insulated
                    Electrical
                    Wire & Cable                  Other
          <C>        <C>                          <C>
          1995       $32,745                      $2,598
          1996        37,376                       3,321
          1997        39,950                       1,066
</TABLE>
     (ii) The Company's newly established specialty cable operation
in Kilkenny, Ireland began producing cable in the fall of 1997.  The
facility continues to ramp-up its production capabilities.  The focus of
this factory is to manufacture lower volume, higher value-added cable
products as part of the Company's ongoing effort to shift its manufactured
product orientation toward higher margin specialty cable.  The Kilkenny
plant's initial product is a high quality fire alarm cable designed to
comply with the most stringent alarm cable standards worldwide.

    (iii) The principal sources of raw material for insulated electrical
wire and cable products-copper wire conductor and PVC insulating materials-
are refining and wire drawing and chemical companies, respectively.  During
the past fiscal year, availability of raw materials was satisfactory,
although copper prices rose until May and then steadily declined for the
remainder of the year.

     (iv) The Company owns certain trademarks which are maintained
internationally.  As part of the 1994 restructuring described in item 1(a),
the Company granted Harrison a license to use certain trademarks in
consideration for specified license fees which have presently been deferred.

     Except as mentioned above, there are no patents, licenses, franchises
or concessions held that are material to the business of the Registrant or
its subsidiaries.

     (v)  The business of the Registrant is not of a seasonal nature.

     (vi) Following industry practice, the Registrant and its subsidiaries
grant payment terms to their customers ranging from 60 days to 150 days
depending on the countries where the companies do business.

     (vii) The Registrant and its subsidiaries have two customers, which
together represent 22.2% of consolidated receivables and 17.3% of
consolidated revenues for 1997.  These receivables are insured against bad
debts.

     (viii)  The following amounts represent the backlog of orders believed
to be firm as of the end of each year; all were expected to be filled within
the following year:
<TABLE>
                               Irish Driver-Harris Co. Ltd.
     <S>                                <C>
     December 31, 1996                  $ 943,000
     December 31, 1997                     70,000
</TABLE>

     (ix) No material portion of the business of the Registrant and its
subsidiaries is subject to renegotiation of profits or termination of
contracts or subcontracts at the election of the U.S. government.

     (x)  The Registrant's insulated wire and cable products are marketed
primarily in Ireland, the U.K., the European continent, and the Mid and Far
East.  Such products are essentially similar to those of its competitors of
which there are many, some substantially larger than the Company.
The principal methods of competition are price, quality, and fast response
to customers' orders.

     (xi) The Registrant believes that the cost of research and development
activities was not material during the past three fiscal years.  No employees
were engaged in such activities on a full-time basis during that period.  All
research and development projects are performed by engineering and production
personnel in conjunction with other functions without separate accounting
therefor.

     (xii) Harrison Alloys Inc. has assumed all environmental obligations
with respect to the Company's former U.S. plant facilities.

     (xiii) The number of persons employed by the Registrant and its
subsidiaries at the end of the last fiscal year was 158.

(d)  Financial Information about Foreign and Domestic Operations and Export
Sales

  (i)  Information regarding foreign and domestic operations is provided in
Notes 3  and  9 to the consolidated financial statements.

  (ii) The Registrant depends heavily on foreign operations for the
generation of earnings.  The insulated wire and cable operations are located
in Ireland and the U.K.   These countries are considered to have relatively
stable governments and minimum political risk; nonetheless there is
exposure to fluctuations in currency exchange rates and normal business risk.

(e)  Executive Officers of the Registrant

          Name                Age       Position
     Frank L. Driver IV        37       President, Chief Executive Officer
     Lavinia Z. Emery          53       Secretary and Assistant Treasurer
     Thomas J. Carey           61       Chief Financial Officer

     Officers are elected annually by the Board of Directors for one-year
terms expiring in June.

     Mr. Frank L. Driver IV joined the Company in 1989 as Assistant
Controller; in 1991 he was elected Vice President-Marketing and in 1993 he
became Vice President-Finance.  In September 1994, he was elected President.
Prior to joining the Company, he was a senior financial analyst with
General Motors Corp.  Mr. Driver is the nephew of Mr. David A. Driver,
Chairman of the Company.

     Ms. Lavinia Z. Emery joined the Company in 1982 in an administrative
capacity.  In 1985 she was elected Assistant Secretary and Assistant
Treasurer.  In 1988 she was elected Secretary and Assistant Treasurer.

     Mr. Thomas J. Carey was hired by the Company as a Consultant and Chief
Financial Officer in 1995.  In 1992 through 1994, he was Chief Financial
Officer of the Home News Company, New Brunswick, NJ and prior to that a
partner of Deloitte & Touche.

Item 2.   Properties

     The  principal properties of the Registrant and its subsidiaries are two
plants and related distribution centers in Ireland.  The main plant was
constructed in 1990 and is deemed adequate for the enterprise.  Additional
adjacent land was acquired in 1997 for expansion.  Both are owned by
the Irish subsidiary and subject to liens by the lenders.  The second plant
was acquired under a long term Irish Development Authority financing plan in
1997 and has adequate room for expansion.

Item 3.   Legal Proceedings

     None of material nature.

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

     None in the fourth quarter of 1997.

                            PART II

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

  (a)  The Company's common stock is traded on the American Stock Exchange.
The high and low sales prices for the stock were as follows:
<TABLE>
                       1997                 1996
     Quarter      High      Low       High         Low
     <S>          <C>       <C>        <C>       <C>
     First        10        8 5/8      6 1/2     5 1/2
     Second       10 5/8    9 5/8      8 7/8     6 1/2
     Third        13 1/4   10          8 1/4     5 1/2
     Fourth       13 3/4    9 3/4      8 7/8     7 1/8
</TABLE>
     (b)  The approximate number of common shareholders as of March 16, 1998
was 390. This figure represents the sum of the number of shareholders of
record, plus an estimate of the number of individual shareholders whose
shares are held collectively by stockbrokers.

     (c)      The Company has not paid cash dividends during 1997 and 1996.
The note payable to the Pension Benefit Guaranty Corporation (PBGC)
prohibits the payment of cash dividends without permission of the PBGC
(reference is made to Note 4 to the consolidated financial statements).

Item 6.   Selected Financial Data
<TABLE>
        - - - - Y e a r     E n d e d     D e c e m b e r     3 1 - - - - -
                                             Pro Forma
                                            (Unaudited)
                     1997    1996     1995    1994      1994    1993
                       (Amounts in thousands, except per share data)
Net sales and other
   <S>            <C>      <C>      <C>     <C>       <C>      <C>
   Revenues       $41,179  $41,724  $36,719 $29,060   $60,558  $83,997

Net (Loss) Income    (565)   2,452    1,332    (490)     (976)  (1,992)

Total assets       20,724   21,178   16,255       -    15,893   38,609

Long-term debt      2,476    2,023    1,907       -     2,734    4,098


Per Common Share:
 Basic Net (Loss)
   Income           $(.42)   $1.86    $1.03   $(.38)   $(.75)   $(1.54)
                      ===     ====    ====     ====     ====      ====
Diluted Net (Loss)
   Income           $(.42)   $1.86    $1.03   $(.38)   $(.75)  $(1.54)
                      ===     ====    ====     ====     ====     ====
Basic earnings per share
   weighted average shares
   outstanding      1,339    1,317   1,295    1,294    1,294    1,294
                    ====     ====    ====     ====     ====     ====
Diluted earnings per share
 weighted average shares
 outstanding       1,354    1,321    1,296    1,294    1,294    1,294
                   ====     ====      ====    ====      ====     ====
</TABLE>
During 1997, the Company adopted the provisions of Financial Accounting
Standards Statement No. 128, "Earnings Per Share".  As a result all prior
year share amounts have been recalculated to conform with Statement 128.

In 1997, the Company sold its 50% interest in Quality Heat Treatment Pty.
Ltd., a company in the furnace manufacturing and heat treating business,
located in Australia, for a net profit of $128,000 ($.09 per share).

In 1996, the Company's fifty percent owned company, Harrison, sold its
foreign operations to Kanthal AB a Swedish company.  (See Note 1 of the
financial statements.) This transaction increased net income by $895,000
($.68 per share).

In 1994, the Company restructured its foreign electrical resistance wire
operations and divested its U.S. operating company.  The pro forma amounts
above give effect to the restructure on March 18, 1994 and Alloys divestiture
as if both transactions occurred on January 1, 1994.

In 1993, the Company adopted SFAS 106 "Employers' Accounting for
Postretirement Benefits Other Than Pensions".  This change increased the 1993
net loss by $180,000 ($.14 per share).

Overview and Financial Condition:

The Company, directly and through its subsidiaries and affiliate, is engaged
in the business of manufacturing insulated electrical wire and cable through
its wholly owned subsidiary, Irish Driver-Harris Co., Ltd., located in
Ireland and the U.K.

In 1994, the Company restructured its operations whereby the Company
transferred its overseas resistance operations to Harrison Alloys Inc. as
well as its U.S. operating subsidiary in exchange for an increase to 50% of
the Company's ownership of Harrison.  Although Harrison is required to pay
to the Company license fees and commissions totaling $500,000 per year from
1994 to 2003, which is recorded in other income, no payments have been
received since December 1996 and Harrison is presently restructuring its
operations.  Income from Harrison will not be recorded until amounts are
received.

Under the New Jersey Industrial Site Recovery Act certain clean-up procedures
must be completed with respect to the New Jersey locations.  Harrison has
assumed all of the obligations and liabilities of the Registrant and Alloys
under any federal and state environmental laws pursuant to the 1994
restructuring.

The Company has a note payable to the Pension Benefit Guarantee Corporation
("PBGC")which is due September 2000. The PBGC has the right to convert the
entire unpaid principal and accrued interest into common stock of the
Company.  Until the note is paid in full, the Company may not pay cash
dividends on its capital stock without permission from the PBGC.  See
further discussion in Note 4 to the consolidated financial statements.

In connection with the sale by Harrison of its foreign subsidiaries in
February 1996, and repayment by Harrison of bank debt, guaranteed by the
Company, with a portion of the proceeds, the Company (i) collected certain
receivables from Harrison, (ii) repaid domestic bank debt and,  (iii)
was relieved of the Harrison debt guarantee obligation.

In November 1996, the Company purchased the assets of a distribution company,
Kestrel Cables Distribution Limited, in the U.K. for $1,342,000.  Kestrel
incurred a substantial loss in 1997 due to restructuring costs including
write down of inventories.  Management believes the steps taken to reduce
the cost structure will enable the Company to achieve profitability in 1998.

Capital expenditures during the year totaled $2,191,000, including
approximately $2,137,000 in additions to property, plant and equipment for
the Company's Irish subsidiary.  Cash flow from short-term borrowings was
sufficient to fund the capital expenditures at the Company's Irish
subsidiary.  At December 31, 1997, the Company's subsidiaries had
approximately $5,431,000 of available bank lines of credit of which
$4,179,000 was outstanding at year end.  Additionally, the
Company had $848,000 in cash and cash equivalents on hand at December 31,
1997.

The ratio of current assets to current liabilities was 1.36 at the end of
1997, compared with 1.47 at the end of 1996.  Current assets decreased
slightly due to the disposal of the Company's 50% interest in Quality Heat
Treatment Pty. Ltd., in Australia, which was consolidated in 1996.

The Company believes it has adequate cash flow to meet its ongoing
obligations which include debt repayments and capital commitments of its
subsidiaries.

Impact of Year 2000

The Company's major computer system and related programs are resident in its
operating subsidiary in Ireland.  The Company is presently assessing its
software there to be certain its computer systems will function properly with
respect to dates in the year 2000 and thereafter.  The assessment project is
planned to be completed before year end December 31, 1998.  The Company
believes that with modification to existing software and conversions to new
software, the Year 2000 issue will not pose significant problems for its
computer systems.  However, if such modifications and conversions are not
made, or are not completed timely, the Year 2000 issue could have a
material impact on the operations of the Company.  Based on management's
best estimates, the purchase cost of new software that will be capitalized
and related costs to be expensed as incurred are estimated to approximate
$80,000.  However, there can be no guarantee that these expectations
will be achieved and actual results could differ materially from those
presently anticipated.  Specific factors that might cause such material
differences include, but are not limited to, the availability and
cost of personnel trained in this area, the ability to locate and correct
all relevant computer codes, and similar uncertainties.

Results of Operations

Year ended December 31, 1997 compared to year ended December 31, 1996

Although net sales to customers decreased by 11% in the last quarter compared
to 1996, net sales increased slightly for the entire year.  Units shipped for
the year were up 3.0% in the last quarter and 8.7% for the year.  1997
included $1,066,000 for the Australian subsidiary compared to $3,508,000 for
the full year of 1996.  The gross profit percentage dropped to 13.8% from
16.9% in 1996.  This was due primarily to lower selling prices resulting from
aggressive price cutting within the cable industry and the impact of
significant changes in the relative values of the Irish Punt, UK Sterling
and the U.S. Dollar, as well as a one-time write down of inventory values at
the UK distribution company.  Selling, general and administrative expenses
rose as a percentage of net sales to 14.0% in 1997 compared to 13.1% in 1996.
This was due primarily to start-up expenses at the new UK distribution
company and the new manufacturing facility in Ireland.  Interest expense
increased by 31.8% due to higher average borrowings in Ireland for capital
spending compared to 1996.

As a result of the UK Pound Sterling strengthening against the Irish Punt,
the Company's Irish subsidiary recorded a foreign exchange gain of $374,000
in 1997. The Irish subsidiary transacts 75% of its business in Sterling.
The Company disposed of its 50% interest in Quality Heat Treatment Pty. Ltd.,
Australia, in September 1997, recording a net gain of $128,000 on the
transaction.

Income taxes for 1997 result from foreign taxable income at the Company's
Irish subsidiary.  The Company has tax loss carry forwards of approximately
$6,500,000 available to offset future U.S. taxable income, which expire
between 1999 and 2010.  A valuation allowance of $2,560,000 and $2,440,000
has been provided at December 31, 1997 and 1996 respectively.  These
valuation allowances were established since it is not certain that the
deferred tax assets, primarily the net operating loss carry forwards, will be
realized.  See further discussion in Notes 1 and 6 to the consolidated
financial statements.

Year ended December 31, 1996 compared to year ended December 31, 1995

Net sales to customers increased by 15.1% for the year and 12.2% for the
fourth quarter compared to 1995.  This was primarily due to an increase in
units shipped for the year.  The gross profit percentage improved to 16.9%
for 1996 compared to 14.4% in 1995.  The gross profit percentage had
decreased in early 1995 because of the higher cost of raw materials,
principally copper and PVC.   Selling prices were subsequently increased as
a result of these higher raw material costs, and the gross profit percentage
for the last quarter of 1995 was 17.0%.  Selling, general and administrative
expenses rose as a percentage of net sales to 13.1% in 1996 compared to 12.3%
in 1995 due primarily to start-up expenses at the new distribution company
(see prior page).  Interest expense decreased slightly due to lower average
borrowing in 1996 compared to 1995.

Item 7.   Management' Discussion and Analysis of Financial Condition and
Results of Operations (Continued)

1996 includes an $895,000 gain in connection with the sale of Harrison's
foreign operations. This gain consists of the elimination of a $1,561,000
negative investment in Harrison and a related $968,000 deferred credit,
(these amounts equaled the balance of the bank debt of Harrison
guaranteed by the Company) less the balance of the accumulated translation
adjustment of $1,634,000 (relating to the Harrison overseas subsidiaries
transferred in 1994).  The income was recognized in the first quarter of 1996
when Harrison paid off the bank loan which the Company had guaranteed with
the proceeds of the sale of its overseas operations in February, 1996.  The
Company will not recognize any income from its investment in Harrison until
Harrison's income exceeds Harrison's losses not recognized by the Company as
the Company previously had recorded losses from their investment in Harrison
to the extent of the Harrison bank debt guarantee which as noted above is no
longer in effect.

The provision for income taxes for 1996 was $225,000, or 8.4% of pretax
income.  The provision for income taxes for 1995 was $98,000 or 6.9% of
pretax income.  The difference between the effective tax rate and statutory
rate is primarily due to taxes of foreign subsidiaries at rates
different than the U.S. statutory rates and the benefit of net operating
carry forwards available to offset future U.S. taxable income.  The
utilization of tax loss carry forwards provided tax benefits
of $42,000 in the 1995 period.  The Company has tax loss carry forwards of
approximately $6,400,000 available to offset future U.S. taxable income.
Such carry forwards expire in various years between 1999 and 2010. A
valuation allowance of $2,440,000 and $2,470,000 has been provided at
December 31, 1996 and 1995 respectively.  These valuation allowances were
established since it is not certain that the deferred tax assets, primarily
the net operating loss carry forwards, will be realized.  See further
discussion in Notes 1 and 6 to the consolidated financial
statements.

The foregoing discussion contains certain forward-looking statements which
involve risks and uncertainties.  The Company's actual results could differ
materially from the results anticipated in such forward-looking statements.

Item 8.   Financial Statements and Supplementary Data

This information is submitted in a separate section of this report.

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

     None



                                     PART III

Item 10.  Directors and Executive Officers of the Registrant

The table listing this information with respect to directors of the Company,
and the statement of compliance with Sec. 16(a) of the Exchange Act, included
in the proxy statement anticipated to be filed on or about April 29, 1998,
is herein incorporated by reference.  The information with respect to
executive officers is included in Part I of this Form 10-K.

Item 11.  Executive Compensation

The information with respect to officers and directors of the Company,
included in the proxy statement anticipated to be filed on or about April 29,
1998, is herein incorporated by reference.

Item 12.  Security ownership of Certain Beneficial Owners and Management

The information required by this item, included in the proxy statement
anticipated to be filed on or about April 29, 1998, is herein incorporated
by reference.


Item 13.  Certain Relationships and Related Transactions

The information required by this item, included in the proxy statement
anticipated to be filed on or about April 29, 1998, is herein incorporated
by reference.


          PART IV

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

 (a) (1) and (2) This portion of Item 14 is submitted in a separate section
of this report.
     (3)  Listing of Exhibits
          Exhibit 3.   Certificate of Incorporation and By-Laws
          Exhibit 10.  Material contracts
          Exhibit 21.  Subsidiaries of the Registrant
          Exhibit 27.  Financial Data Schedule

 (b)  Reports on Form 8-K

          None filed in the fourth quarter of 1997.

 (c)  Exhibits
                                                            Incorporated
                                                             by Reference
                                                              to SEC Form
      Exhibit 3.    Articles of Incorporation and By-Laws     8-K dated
                                                           November 1, 1982

                    Amendments thereto                    8-K dated
                                                    June 17, 1987

      Exhibit 10.    Material Contracts:
                                                                Incorporated
                                                                by Reference
                                                               to SEC Form
                    Settlement Agreement with Pension
                    Benefit Guaranty Corporation dated         8-K dated
                    December 22, 1993                       December 22, 1993

                    Amended and Restated Agreement between
                    Harrison Alloys Inc., Driver-Harris
                    Company, HAI Industries Inc., and
                    HAI Holding Company Inc., dated              8-K dated
                    March 18, 1994                             April 7, 1994

                    Note Modification Agreement, Loan and
                    Security Agreement Modification
                    Agreement, and Release of Guaranty
                    between Driver-Harris Alloys Inc.,
                    Harrison Alloys Inc., and Textron
                    Financial Corporation, all dated             8-K dated
                    February 25, 1994                         April 7, 1994

     Exhibit 21.    Subsidiaries of the Registrant as of December 31, 1997

          SUBSIDIARIES OF THE REGISTRANT

          Name                          Jurisdiction of Incorporation
          Driver-Harris Alloys Inc.      New Jersey (Inactive Corporation)
          Irish Driver-Harris Co. Ltd.            Ireland
          Kingston Cable Distributors Ltd.        United Kingdom
             (Subsidiary of Irish Driver-Harris Co. Ltd.)
          Kestrel Cables Distribution Ltd.        United Kingdom
             (Subsidiary of Irish Driver-Harris Co. Ltd.)

          Exhibit 27.    Financial Statement Schedules

This portion of Item 14 is submitted in a separate section of this report.

                          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.

                                        DRIVER-HARRIS COMPANY


March 30, 1998                     /s/    Thomas J. Carey
--------------------       ------------------------------------------------
Date                               Thomas J. Carey
                                   Chief Financial Officer


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.


/s/    Ralph T. Bartlett                     /s/    David A. Driver
----------------------------            -------------------------------
Ralph T. Bartlett                       David A. Driver
Director                                Chairman
Date:     March 30, 1998                Date:   March 30,1998



/s/   H. L. Biggerstaff                      /s/    Frank L. Driver IV
------------------------------          ----------------------------------
H. L. Biggerstaff                    Frank L. Driver IV
Director                             Director, President and Chief Executive
Date:     March 30, 1998             Officer
                                     Date: March 30, 1998

<PAGE>


              Annual Report on Form 10-K Item 8,
              Item 14(a) (1) and (2), (c) and (d)

               List of Financial Statements and
                 Financial Statement Schedules

                       Certain Exhibits

                 Financial Statement Schedules

            Driver-Harris Company and Subsidiaries

                       December 31, 1997
<PAGE>

            Driver-Harris Company and Subsidiaries

               Form 10-K Item 14(a) (1) and (2)

List of Financial Statements and Financial Statement Schedules


The following consolidated financial statements of Driver-Harris Company and
Subsidiaries are included in Item 8:

  Consolidated Balance Sheets - December 31, 1997 and 1996         Page 20

  Consolidated Statements of Operations - Years ended December 31, 1997,
     1996 and 1995                                                 Page 22

     Consolidated Statements of Stockholders' Equity - Years ended
     December 31, 1997, 1996 and 1995                              Page 23

     Consolidated Statements of Cash Flows - Years ended December 31,
     1997, 1996 and 1995                                           Page 24

     Notes to Consolidated Financial Statements                    Page 25


The following consolidated financial statement schedules of Driver-Harris
Company and Subsidiaries are included in Item 14(d):

     Schedule I  - Condensed Financial Information of Registrant      Page 42

     Schedule II - Valuation and Qualifying Accounts                  Page 43


All other schedules for which provision is made in the applicable accounting
regulation of the Securities and Exchange Commission are not required under
the related instructions or are inapplicable, and therefore have been omitted.
<PAGE>
                Report of Independent Auditors

Board of Directors
Driver-Harris Company


We have audited the accompanying consolidated balance sheets of Driver-Harris
Company and Subsidiaries as of December 31, 1997 and 1996, and the related
consolidated statements of operations, stockholders' equity and cash flows
for each of the three years in the period ended
December 31, 1997.  Our audits also included the financial statement
schedules listed at Item 14(a).  These financial statements and financial
statement schedules are the responsibility of the Company's management.  Our
responsibility is to express an opinion on these financial
statements and schedules based on our audits.  We did not audit the financial
statements of certain foreign consolidated subsidiaries which statements
reflect total assets constituting 23% in 1997 and 29% in 1996, and total
revenues constituting 20% in 1997, 21% in 1996 and 9% in 1995 of the related
consolidated totals.  Those statements were audited by other auditors whose
reports have been furnished to us, and our opinion, insofar as it relates to
data included for such subsidiaries, is based solely on the reports of other
auditors.

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 and the
reports of other auditors provide a reasonable basis for our opinion.

In our opinion, based upon our audits and the reports of other auditors, the
consolidated financial statements referred to above present fairly, in all
material respects, the consolidated financial position of Driver-Harris
Company and subsidiaries at December 31, 1997 and 1996,
and the consolidated results of their operations and their cash flows for
each of the three years in the period ended December 31, 1997, in conformity
with generally accepted accounting principles.  Also, in our opinion, the
related financial statement schedules, when considered in relation to the
basic financial statements taken as a whole, present fairly, in all material
respects, the information set forth herein.


MetroPark, New Jersey
March 20, 1998                          /s/    ERNST & YOUNG LLP
<PAGE>
           AUDITORS' REPORT TO THE MEMBERS

                              of

              KINGSTON CABLE DISTRIBUTORS LIMITED



We have audited the accompanying balance sheets of Kingston Cable
Distributors Limited as of 31 December 1997 and 31 December 1996 and the
related statements of profit and loss and cash flows for each of the three
years in the period ended 31 December 1997.  These financial statements are
the responsibility of the Company's management.  Our responsibility is to
express an opinion on these financial statements based on our audit.

We conducted our audits in accordance with generally accepted auditing
standards of the United States.  Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material mis-statement.  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, the financial statements referred to above present fairly, in
all material respects, the financial position of Kingston Cable Distributors
Limited as of 31 December 1997 and 31 December 1996, and the results of its
operations and its cash flows for each of the three years in the period ended
31 December 1997, in conformity with generally accepted accounting
principles of the United States.





27 March 1998                      /s/  James, Stanley & Co.
                                        Registered Auditors
                                        Chartered Accountants
                                        1733 Coventry Road
                                        South Yardley
                                        Birmingham
                                        B26 1Dt
<PAGE>
                       AUDITORS' REPORT TO THE MEMBERS

                              of

              KESTREL CABLES DISTRIBUTION LIMITED



We have audited the accompanying balance sheets of Kestrel Cables
Distribution Limited as of 31 December 1997 and 31 December 1996 and the
related statements of profit and loss and cash flows for the year ended 31
December 1997 and the two month period ended 31 December 1996.  These
financial statements are the responsibility of the company's management.  Our
responsibility is to express an opinion on these financial statements based
on our audit.

We conducted our audits in accordance with generally accepted auditing
standards of the United States.  Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free from material mis-statement.  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, the financial statements referred to above present fairly, in
all material respects, the financial position of Kestrel Cables Distribution
Limited as of 31 December 1997 and 31 December 1996, and the results of its
operations and its cash flows for the year ended 31 December 1997 and the two
month period ended 31 December 1996 in conformity with
generally accepted accounting principles of the United States.




27 March 1998                      /s/  James, Stanley & Co.
                                        Registered Auditors
                                        Chartered Accountants
                                        1733 Coventry Road
                                        South Yardley
                                        Birmingham
                                        B26 1DT
<PAGE>
                Driver-Harris Company and Subsidiaries

                  Consolidated Balance Sheets

                  Dollar Amounts in Thousands
<TABLE>
                                             December 31
                                        1997               1996
Assets                                  ------------------------
Current Assets:
     <S>                                <C>            <C>
     Cash                               $     848      $      402
     Receivables, less allowances of $406
         and $408                           9,325           9,275
     Inventories:
         Materials                            536              624
         In process                           254              413
         Finished                           3,920            3,925
                                         --------           --------
                                            4,710            4,962
     Prepaid expenses                         497              937
                                          --------          --------
Total current assets                       15,380           15,576

Other assets                                   16               107

Property, plant and equipment, at cost:
     Land and buildings                     3,480             3,278
     Machinery and equipment                3,731             4,229
     Office equipment                         242                361
                                       ----------           --------
                                            7,453            7,868
     Less accumulated depreciation and
       amortization                         2,125            2,373
                                         --------           --------
                                            5,328            5,495
                                          --------          --------
                                          $20,724           $21,178
                                            =====           =====
</TABLE>
See accompanying notes.
<PAGE>
                  Driver-Harris Company and Subsidiaries

            Consolidated Balance Sheets (continued)

                  Dollar Amounts in Thousands
<TABLE>
                                             December 31
                                             1997      1996
                                        ------------------------
Liabilities and stockholders' equity
Current liabilities:
<S>                                    <C>                <C>
Short-term borrowing                   $ 4,179            $ 2,664
Current portion of long-term debt          515                492
Accounts payable                         5,176              5,594
Accrued expenses                         1,293              1,572
Income taxes payable                       108                263
                                       -------           ----------
Total current liabilities               11,271             10,585

Long-term debt                           2,524              2,023
Deferred Grants                            796                812
Deferred foreign income taxes              147                174
Postretirement benefit liabilities         574                279
Sundry liabilities                         149                185
                                       -------             --------
                                        15,461             14,058
Stockholders' equity:
 Common stock -- par value $0.83 1/3 per share:
 Authorized 3,000,000 shares; issued 1,424,928
  shares at December 31, 1997 and December
  31, 1996 (including 84,507 and 87,757
  treasury shares at December 31, 1997
              and 1996)                 1,223               1,221
  Additional paid-in capital            2,228               2,200
  Retained earnings                     3,030               3,595
  Equity adjustment from translation   (1,218)                104
                                      --------              --------
                                        5,263               7,120
Commitments and contingencies
                                      --------             -------
                                      $20,724              $21,178
                                       =====                 =====
</TABLE>
See accompanying notes.
<PAGE>

            Driver-Harris Company and Subsidiaries

             Consolidated Statements of Operations

      Dollar Amounts in Thousands, Except per Share Data

<TABLE>
                                           Year ended December 31
                                        1997      1996      1995
Revenues:
     <S>                                <C>       <C>        <C>
     Net sales                          $41,016   $40,697    $35,343
     Other                                  163     1,027      1,376
                                        -------  --------   --------
                                         41,179    41,724     36,719
Costs and expenses:
     Cost of sales                       35,350     33,804     30,258
      Selling, general and administrative 5,770      5,343      4,362
                                     --------     ---------     --------
Income from Operations                      59       2,577       2,099

     Interest expense                    1,074         816         829
     Foreign exchange (gain) loss and sundry
                                          (374)        (21)       (20)
     Equity in net (gain) loss of
      related company                     (140)
     Gain on sale of interest in
      Australian subsidiary               (128)
     Gain in connection with sale of
       foreign
       operations by related company                  (895)
                                     --------      --------      --------
(Loss) income before income taxes        (513)       2,677       1,430

Provision for income taxes                 52          225          98
                                      -------      --------     --------
Net income (loss)                     $  (565)     $ 2,452      $ 1,332
                                        =====      =====      =====
Basic net income (loss) per share      $ (.42)      $ 1.86       $ 1.03

Diluted net income (loss) per share    $ (.42)      $ 1.86       $ 1.03

</TABLE>

See accompanying notes.
<PAGE>
            Driver-Harris Company and Subsidiaries

        Consolidated Statements of Stockholders' Equity

          For the three years ended December 31, 1997

                  Dollar Amounts in Thousands
<TABLE>
                                                            Equity
                                 Additional   Retained    Adjustment
                         Common   Paid-In     Earnings    From Trans-
                         Stock    Capital    (Deficit)     lation     Total
                         -----------  -------------     ------    -------

Balance at
   <S>                 <C>        <C>        <C>          <C>        <C>
   January 1, 1995     $ 1,187    $ 1,982    $    (189)   $ (2,072)  $   908
     Sale of 2,850
       treasury shares                 15                                 15
   Net income                                    1,332                 1,332
   Adjustments from exchange
     rate changes                                              189       189
                        ---------------------------------------------------
   Balance at
     December 31, 1995  1,187       1,997        1,143      (1,883)    2,444
   Exercise of 782
     treasury shares        1           5                                  6
   Directors compensation   2          11                                 13
   Exercise of 37,500
     option shares         31         187                                218
   Net income                                    2,452                 2,452
   Adjustment from exchange
     rate changes                                              293       293
   Adjustment in connection with
     sale of foreign operations by
     related company                                         1,694     1,694
                      ------------------------------------------------------
Balance at
  December 31, 1996     1,221       2,200        3,595         104     7,120
  Directors' and Officers
     compensation           2          28                                 30
  Net loss                                        (565)                 (565)
  Adjustments from exchange
      rate changes                                          (1,322)   (1,322)
                      ------------------------------------------------------
  Balance at
   December 31, 1997  $ 1,223     $ 2,228      $ 3,030     $(1,218)  $ 5,263
                      ======================================================
</TABLE>
   See accompanying notes.


        <PAGE>



            Driver-Harris Company and Subsidiaries

             Consolidated Statements of Cash Flows

                  Dollar Amounts in Thousands

<TABLE>
                                      Year ended December 31
                                   1997          1996           1995
Operating activities
<S>                              <C>             <C>             <C>
Net income (loss)                $   (565)       $ 2,452         $ 1,332
Adjustments to reconcile net income
   (loss) to net cash provided by
   (used in) operating activities:
      Depreciation and amortization   643           676              471
      Provision for doubtful accounts  76           111             (113)
      Gain on sale of fixed assets    (13)         (172)
      Gain on sale of foreign
        subsidiary                   (128)
      Equity in related company                  (1,561)            (140)
      Non-cash compensation            30            19
      Deferred credit                              (968)            (298)
      Elimination of equity adjustment from
        translation for foreign operations
        sold by related company                   1,634
      Account with related company                  253              (50)
      Receivables                  (1,837)       (1,558)              219
      Inventories                    (520)         (235)              (32)
      Prepaid expenses                353          (498)             (156)
      Accounts payable and accrued
         expenses                     772            (3)              689
      Sundry                          (13)          (57)               (8)
                                   ---------------------------------------
Net cash provided by (used in) operating
      activities                   (1,202)           93             1,914

Investing activities
Capital expenditures               (2,191)       (1,576)             (441)
Proceeds from sale of fixed assets    552           234
Assets purchased through acquisition             (1,164)
Proceeds from sale of subsidiary      225
Sundry                                               48                 34
                                  -----------------------------------------
Net cash used in investing
  activities                       (1,414)       (2,458)             (407)

Financing activities
Change in short-term debt           2,054         1,847           (1,083)
Change in deferred grants             110           300               (7)
Proceeds from issuance of
  long-term debt                    1,322           313              239
Reduction of long-term debt          (389)         (391)            (662)
Issuance of capital stock                           215
Sundry                                                                15
                                   ---------------------------------------
Net cash provided by (used in) financing
      activities                    3,097         2,284           (1,498)

Effect of exchange rate changes
      on cash                         (35)            4                9
                                   ---------------------------------------
Net change in cash                    446           (77)              18
Cash at beginning of year             402           479              461
                                   ----------------------------------------
Cash at end of year               $   848      $    402          $   479
                                   ========================================
Supplemental disclosure of cash flow information
Cash paid during the year for:
      Interest                     $  988      $    727           $   744
      Income taxes                                   41                 8

Supplemental schedule of non-cash investing activities
      Receivables offset against purchase
          price of acquisition                 $    178

</TABLE>
See accompanying notes.
<PAGE>

            Driver-Harris Company and Subsidiaries

          Notes to Consolidated Financial Statements

                  December 31, 1997 and 1996

1.  Summary of Accounting Policies

Principles of Consolidation

The consolidated financial statements include the accounts of Driver-Harris
Company (the "Company") and its wholly-owned subsidiary, Irish Driver-Harris
Co. Ltd. ("IDH"), located in Ireland and the U.K. and the operations of
Quality Heat Treatment Pty. Ltd. through its disposition in September, 1997.
Intercompany accounts, transactions and profits have been eliminated in
consolidation.

In November 1996, the Company, through a holding company wholly owned by its
Irish subsidiary,  purchased the assets, substantially inventory, of a
distributor in the U.K. for approximately $1,342,000 of which $178,000 was
netted against amounts owed to IDH from the seller.  The acquisition was
accounted for as a purchase and no goodwill resulted from the transaction.
The new company distributes cable products and insulated wire products in the
U.K. and Europe.  Two months of operations of this distributorship have been
included in the Company's consolidated financial statements for 1996.

The Company, directly and through its subsidiaries, is engaged in the
business of manufacturing and marketing non-ferrous metal products,
principally electrical resistance wire and insulated
electrical wire and cable.

Harrison Alloys Inc. ("Harrison"), (referred to herein as a "related
company") a fifty percent owned company, is recorded on the equity method of
accounting.  The recognition of losses reduced the carrying amount of the
Company's investment in Harrison to a negative balance (liability) of
$1,561,000 at January 1, 1996.  This amount, combined with a deferred credit
of $968,000 which originated from a restructuring in 1994, equaled the
balance of a bank loan of Harrison ($2,529,000) which the Company guaranteed.
In the first quarter of 1996, Harrison sold its foreign alloy companies and
repaid the debt guaranteed by the Company with a portion of the proceeds.
Accordingly, the Company recorded income from its negative investment in
Harrison of $1,561,000 and the elimination of the deferred credit of $968,000,
less the accumulated translation adjustment (related to the foreign
operations sold by Harrison) carried on the balance sheet of $1,634,000.
200,000 pledged shares of the Company and the capital stock of the Irish
subsidiary held as collateral for the guaranty were also returned to the
Company.  The Company will not recognize any income from its investment in
Harrison until Harrison's income exceeds Harrison's losses not recognized by
the Company as the Company previously had recorded losses from their
investment in Harrison to the extent of the Harrison bank debt guarantee
which as noted above is  no longer in effect.

Inventories

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

Property, Plant and Equipment

Depreciation has been provided principally by the straight-line method based
upon estimated useful lives of the depreciable assets.

Deferred Grants

Deferred grants represent foreign government grants received by its Irish
subsidiary.  The grants received with respect to capital expenditures are
treated as a deferred credit and are amortized to income over the expected
useful life of the related asset.

Income Taxes

Deferred income tax assets and liabilities are computed annually for
differences between the financial statement and tax basis of assets and
liabilities that will result in taxable or deductible amounts in the future
based on enacted tax laws and rates applicable to the periods in which the
differences are expected to affect taxable income.  Valuation allowances are
established when necessary to reduce deferred tax assets to the amount
expected to be realized.  Income tax expense is the tax payable or refundable
for the period plus or minus the change during the period in deferred tax
assets and liabilities.

Revenue Recognition

Sales revenues are recognized at the time products are shipped.

Earnings per Common Share

In 1997, the Financial Accounting Standards Board issued Statement No. 128,
"Earnings Per Share".  Statement 128 replaced the calculation of primary and
fully diluted earnings per share with basic and diluted earnings per share.
Unlike primary earnings per share, basic earnings per share
excludes any dilutive effects of options, warrants and convertible securities.
Dilutive earnings per share is very similar to the previously reported fully
diluted earnings per share.  All earnings per share amounts for all periods
have been properly, and when appropriate, restated to conform to the
Statement 128 requirements.

As required under the provisions of Statement 128, basic and diluted earnings
per share are calculated as follows:
<TABLE>
                                      1997      1996      1995
     Numerator:
          <S>                      <C>         <C>       <C>
          Net (Loss) Income        $ (565)     $ 2,452   $ 1,332

     Denominator:
     Basic earnings per share -
      weighted average shares   1,339,046    1,317,280   1,295,054
     Effect of dilutive shares -
      stock options                14,824        3,237       1,236
                                 --------   ----------  ---------
     Diluted earnings per share -
      adjusted weighted average
      shares                    1,353,870    1,320,517   1,296,290

     Basic Earnings per share    $ (.42)        $ 1.86     $ 1.03

     Diluted Earnings per share  $ (.42)        $ 1.86     $ 1.03
</TABLE>

Employee Stock Options

As permitted under FASB Statement 123, "Accounting for Stock-Based
Compensation" (FASB 123), the Company elected to follow Accounting
Principles Board Opinion No. 25, "accounting for Stock Issued to Employees"
(APB 25), and related interpretations in accounting for its
employee stock options.  Under APB 25, because the exercise price of the
Company's employee stock options equals or is greater than the market price
of the underlining stock on the date of grant, no compensation expense is
recognized.  Since there were no stock options granted in 1997 and
1996, no disclosures required under FASB 123 were necessary.

Financial Instruments

The predominant portion of the Company's customers are engaged in the
construction, appliance and electrical equipment industries in Ireland and
Great Britain.  The Company grants credit to its customers on open account.
Two customers outstanding balances  represent 22.2% of consolidated
receivables at December 31, 1997.  The majority of accounts receivable,
including these two customers are insured against loss from bad debts.  These
same customers represent 17.3% of consolidated revenues.

Foreign Currency Translation

Assets and liabilities of foreign operations with a functional currency other
than the U.S. dollar are translated into U.S. dollars at year-end exchange
rates.  Revenues and expenses are translated at the average exchange rates in
effect during the year.  Translation adjustments are recorded as a
separate component of equity.  Changes in the equity account during 1997 and
1996 primarily resulted from such translation adjustments and the write-off
of the amounts related to the foreign operations sold by Harrison.

Use of Estimates

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

Impairment of Long-lived Assets

In 1996, the Company adopted SFAS No. 121, "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to be Disposed Of" (FASB 121),
which requires impairment losses to be recorded on long-lived assets used in
operations when indicators of impairment are present and the undiscounted
cash flows estimated to be generated by those assets are less than the
assets' carrying amount.  The adoption of FASB 121 had no effect on the
financial statements.

Impact of Recently Issued Accounting Standards

In June 1997, the Financial Accounting Standards Board issued SFAS No. 130,
"Reporting Comprehensive Income," and SFAS No. 131, "Disclosures about
Segments of an Enterprise and Related Information."  The Company is required
to adopt the provisions of these Statements for the year 1998.  SFAS No. 130
establishes standards for reporting and display of comprehensive
income and its components in a primary financial statement.  The Company is
currently evaluating reporting formats recommended under this Statement.
SFAS No. 131 establishes a  new method by which companies will report
operating segment information.  This method is based on the
manner in which management organizes the segments within a company for
making operating decisions and assessing performance.  The Company continues
to evaluate the provisions of SFAS No. 131 and, upon adoption, the Company
may report operating segments.

Reclassification

Certain prior period amounts have been reclassified to conform with the
current year presentation.

2.  Foreign Operations

Net assets which are located outside the United States and are included in
the consolidated balance sheets are as follows (in thousands):
<TABLE>
                                                  December 31
                                             1997              1996
     Assets
     <S>                                    <C>             <C>
     Receivables                            $ 9,325         $ 9,275
     Inventories                              4,710           4,962
     Other current assets                       483             934
     Property, plant and equipment -- net     5,327           5,492
     Other assets                                16              75
                                            -----------------------
                                             19,861          20,738
     Liabilities
     Current Liabilities                     11,114            9,047
     Long-term debt                           1,475            1,044
     Other long-term liabilities                796              812
     Deferred income taxes                      147              174
     Sundry                                     149
                                           -------------------------
                                             13,681          11,077
                                           -------------------------
     Net assets outside the United States   $ 6,180         $ 9,661
                                            ========================
</TABLE>


2.  Foreign Operations (continued)

Net (loss) income of the Company's foreign subsidiaries included in the
accompanying financial statements amounted to approximately $(243,000) in
1997, $1,554,000 in 1996 and $614,000 in 1995.

Because the Company plans to continue to finance foreign expansion and
operating requirements by reinvesting a substantial portion of the
undistributed earnings of its foreign subsidiaries, United States income
taxes have not been provided on such earnings.  Unremitted earnings of
foreign subsidiaries at December 31, 1997 amounted to approximately
$7,748,000.

3.  Leases

Property, plant and equipment includes the following amounts related to
capital leases (in thousands):
<TABLE>
                                                 December 31
                                             1997            1996
     <S>                                   <C>            <C>
     Machinery and equipment               $ 1,455        $ 1,087
     Less accumulated amortization             379            409
                                             ---------------------
                                           $ 1,076       $    678
                                             =====================
</TABLE>
Amortization of the assets recorded under capital leases is included in
depreciation expense.

The future minimum rental commitments for all operating leases as of
December 31, 1997 are as follows (in thousands):
<TABLE>
               <S>                 <C>
               1998                $   172
               1999                    172
               2000                    165
               2001                    417
               2002                    165
               Thereafter              755
                                     -------
                                    $1,846
                                      =====
</TABLE>
Total rent expense under operating leases for 1997, 1996 and 1995 was
$193,000, $272,000 and $249,000, respectively.

4.  Long-Term Debt and Lines of Credit

Long-term debt is as follows (in thousands):
<TABLE>
                                            December 31
                                        1997             1996
     <S>                              <C>           <C>
     Note payable to Pension Benefit
          Guaranty Corp.              $ 1,049       $     979
     Other mortgage loans                 943           1,044
     Capitalized lease obligations        884             400
     Sundry                               163              92
                                        ------------------------
                                        3,039           2,515
     Less current portion                 515             492
                                        ------------------------
                                      $ 2,524        $  2,023
                                        ========================
</TABLE>
The Company's obligations approximate fair market value.

The note payable to the Pension Benefit Guaranty Corporation (PBGC) is due
September 30, 2000.  Interest accrues at the rate of 7% per year compounded
quarterly and is payable at maturity.  The note and accrued interest may be
prepaid at the Company's option.  The PBGC has the right to convert the
entire unpaid principal and accrued interest into common stock of
the Company at a price of $7.875 per share, until maturity.  Until the note
is paid in full, the Company may not pay cash dividends on its capital stock
without permission from the PBGC.

The Other Mortgage Loans, which are the liability of a subsidiary, bear
interest at 10% per year, and are due in monthly installments through 2000.
These loans and the subsidiary's $4,275,000 general credit line are jointly
collateralized by all of its assets with a net book value of $19,994,000.
Under the terms of the loans, there are certain restrictions which limit the
payment of dividends and management fees paid by the subsidiary.

4.  Long-Term Debt and Lines of Credit (continued)

Maturities of long-term debt at December 31, 1997 are as follows (in
thousands):
<TABLE>
                                        Capitalized
                                          Leases                Other
          <S>                           <C>                   <C>
          1998                          $   226                $   289
          1999                              197                    337
          2000                              172                  1,264
          2001                              179                    250
          2002                              104                      -
          Thereafter                          6                     15
                                        ------------------------------
                                        $   884                $ 2,155
                                        ==============================
</TABLE>
At December 31, 1997, the Company and its subsidiaries had available short-
term bank lines of credit in the aggregate amount of approximately $5,431,000
(which includes the $4,275,000 general credit line) of which $4,179,000 was
in use and is recorded as short-term borrowings on the balance sheet.

The weighted average interest rate on the short-term borrowings of the Company
and its subsidiaries was 7.2% and 10.4% at December 31, 1997 and 1996,
respectively.

5.  Postretirement Benefits - Pensions and Health Care

Pensions

The Company's only defined benefit pension plans are those of a foreign
subsidiary.  These cover substantially all of the foreign subsidiary's
employees, who must contribute to the plan cost.  Benefits are based on
employees' years of service and final compensation.  The subsidiary makes
contributions to the plans in amounts that are intended to provide for
current service and to fund past service liability.

The actuarial assumptions used for the pension plans of the foreign subsidiary
for 1997 and 1996 were as follows:
<TABLE>
          <S>                                     <C>
          Discount rate                           8%
          Annual rate of compensation increase    6%
          Long-term rate of return on plan assets 8%
</TABLE>
5.  Postretirement Benefits - Pensions and Health Care (continued)

The funded status of the pension plans is as follows (in thousands):
<TABLE>
                                                 December 31
                                             1997             1996
     <S>                                      <C>             <C>
     Actuarial present value of
        accumulated benefit
        obligation, all vested                $ 1,332         $ 1,223
                                             ========================

     Projected benefit obligation (PBO)       $ 1,718         $ 1,723
     Fair value of plan assets, invested
      in pooled separate accounts of an
      insurance company                         1,617           1,454
                                             ========================
     Plan assets less than PBO                   (101)           (269)
     Unrecognized initial net gain               (256)           (181)
     Unrecognized prior service cost             (114)           (141)
     Unrecognized transition obligation           475             591
                                             -------------------------
     Accrued net pension liability          $      (4)         $    -
                                             =========================
</TABLE>
Net pension expense for the Company's defined benefit pension plans for 1997
and 1996 included the following components (in thousands):
<TABLE>
                                             1997              1996
  <S>                                      <C>              <C>
  Service cost for benefits earned during
             the year                      $   126          $    122
  Interest cost on projected benefit
             obligation                        124               111
  Actual net gains on plan assets             (243)             (128)
  Net amortization                             143                44
                                             -------------------------
                                               150                149
     Less employee contributions                38                 37
                                             ------------------------
     Net pension expense                   $   112        $     112
                                             ========================
</TABLE>
The Company also has a supplemental pension plan which provides benefits to
the estate of the former Chairman.  The net liability for such benefits as
December 31, 1997 was approximately $435,000 and is reflected in the balance
sheet in the postretirement benefit liabilities.

5.  Postretirement benefits - Pensions and Health Care (continued)

Health Care and Life Insurance

Postretirement health care and life insurance benefits are provided to
certain U.S. employees. These benefits are provided through an insurance
company whose premiums are based on benefits paid.  Harrison assumed the cost
for the pre-1986 retirees, effective January 1, 1994.
Prior thereto, the cost was shared equally by the Company and Harrison.

The Company accounts for postretirement benefits in accordance with SFAS No.
106, "Employers' Accounting for Postretirement Benefits Other Than Pensions".
This standard requires companies to accrue for estimated future
postretirement benefit expenses during the years employees are working and
earning benefits for retirement.  The Company elected to amortize the
estimated liability for postretirement benefits at January 1, 1993, over 15
years.

For 1997, 1996 and 1995, the Company's portion of postretirement benefit
costs aggregated $36,000, $34,000 and $36,000, respectively.
<TABLE>
                                               1997              1996
     <S>                                   <C>               <C>
     Accumulated postretirement benefit obligation:
          Fully eligible plan participants $     -           $       -
          Other active plan participants       254                 244
                                               ------------------------
                                               254                 244

     Unrecognized transition obligation        102                  113
     Unrecognized net loss from past experience
        different from that assumed and from
        changes in assumptions                  12                   14
                                             --------------------------
     Accrued postretirement benefit cost     $ 140               $  117
                                             ===========================
</TABLE>

Postretirement benefit costs for 1997, 1996 and 1995 included the following
 components (in thousands):

<TABLE>
                                           1997      1996         1995
     <S>                               <C>          <C>          <C>
     Service cost for benefits earned during
          the year                     $     5      $     5      $     8
     Interest cost on accumulated postretirement
          benefit obligation                18           16           15
     Amortization of transition obligation  13           13           13
                                         -----      ------        ------
                                        $   36      $   34        $   36
                                           ====      ====            ====
</TABLE>
5.  Postretirement Benefits - Pension and Health Care (continued)

The following assumptions were used at December 31, 1997 and 1996: a discount
rate of 7.25% and a 1996 assumed health care cost trend rate of 5%.

A one percentage point increase in the assumed health care cost trend rate
would have increased the accumulated postretirement benefit obligation at
December 31, 1997 by $19,000 and the aggregate service and interest cost
components of the postretirement benefit cost for 1997 by $4,000.

6.  Income Taxes

Income tax expense (credit) is composed of the following (in thousands):
<TABLE>

                                   1997      1996      1995
          Foreign:
               <S>                 <C>       <C>            <C>
               Current             $ 79      $ 215          $ 51
               Deferred             (27)        10            47
                                   --------------------------------
                                   $ 52      $ 225          $ 98
                                   =================================
</TABLE>
Pre-tax (loss) income attributable to domestic and foreign operations is as
follows (in thousands):
<TABLE>
                                   1997      1996           1995
          <S>                     <C>       <C>            <C>
          United States           $ (322)   $  898         $  718
          Foreign                   (191)    1,779            712
                                   --------------------------------
                                   $ (513)   $2,677        $1,430
                                   =================================
</TABLE>

6.  Income Taxes (continued)

Following is a reconciliation of income tax expense (credit) to the amount
based on the U.S. statutory rate of 35% (1997, 1996 and 1995):
<TABLE>
                                   1997       1996            1995
     <S>                           <C>       <C>            <C>
     Income taxes based on U.S. statutory
          rate                     $ (180)   $   937        $   500
     Non-taxable income:
          Increase (reduction) of
             valuation allowances     120        (30)           (103)
          Life insurance proceeds                               (122)
          Gain in connection with sale of
             foreign operations by related
             company                            (339)
     Increase resulting from losses which
          provided no current tax benefit
          (including equity in losses in
          related company)                                         8
     Taxes of foreign subsidiaries at rates
          different than U.S. statutory
          rate                         119            (373)      (161)
     Other (net)                        (7)             30        (24)
                                   ---------------------------------------
                                     $  52           $ 225   $     98
                                   ======================================
</TABLE>
The components of deferred tax assets and liabilities at December 31, 1997
and 1996, were as follows (in thousands):
<TABLE>
                            1997                            1996
                   Assets         Liabilities         Assets     Liabilities
<S>               <C>                   <C>          <C>              <C>
Inventories       $   64                             $     81
Depreciation                            $ 218                         $ 262
Accrued expenses     225                                  234
Tax loss carry
  forwards         2,285                                2,244
Tax credits           57                                   68
Sundry                                                                   99
                ----------------------------          -----------------------
                   2,631                  218           2,627           361
Valuation
  allowance        2,560                                2,440
               -----------------------------         ------------------------
     Total        $   71                $ 218         $   187          $ 361
               =============================         ========================
</TABLE>
6.  Income Taxes (continued)

At December 31, 1997 the Company had approximately $6,500,000 of loss carry
forwards available to offset future U.S. taxable income.  Such carry forwards
expire beginning in 1999.  A valuation allowance of $2,560,000 and $2,440,000
has been provided at December 31, 1997 and 1996 respectively.  These valuation
allowances were established since it is not certain that the deferred tax
assets, primarily the net operating loss carry forwards, will be realized.

7.  Employee Stock Options

The 1983 Driver-Harris Employee Incentive Stock Option Plan which expired in
1993 provided for the grant of stock options at 100% of market value on date
of grant which are intended to qualify as "incentive stock options" under
Section 422 of the Internal Revenue Code.  Under this plan, 45,000 shares of
stock are reserved for issuance at December 31, 1997 and 1996.  The
following table summarizes the activity in the Plan:

<TABLE>
                                            Number
                                          of Shares Price Per Share
          Outstanding January 1, 1994 and
              <S>                        <C>     <C>   <S> <C>
              December 31, 1995           82,500  $4.00 to $8.50

          Exercised in 1996               37,500    4.00 to 6.875
                                        --------
          Outstanding December 31, 1997
              and 1996                    45,000  $5.25 to $8.50
                                          =====
</TABLE>
The outstanding options at December 31, 1997 which are all fully vested,
expire between 2000 and 2002.

During 1997, the Company issued 750 shares of stock valued at $10 per share
to its non-executive Directors.  In addition, the Company issued an additional
600 shares to two officers of the Company, as an incentive bonus.  Also in
1997, the Company issued 400 shares to an outside consultant.  Total
compensation expense recorded in conjunction with the issuance of
these shares was $30,000.

8.  Industry Segments and Geographic Areas

The Company and its subsidiaries operate in a single industry segment, the
manufacture and sale of wrought non-ferrous metal products, principally
insulated electrical wire and cable.


8.  Industry Segments and Geographic Areas (continued)
<TABLE>
Geographic Areas
                         United    Western              Elimin-   Consol-
                         States     Europe      Other   ations    idated
     1997
<S>                     <C>          <C>       <C>                <C>
Sales to outside
   customers            $39,950      $ 1,066                      $41,016
Other revenues          $    54          109                          163
                    ------------------------------------------------------
Total revenues          $    54      $40,059   $ 1,066            $41,179
                     ------------------------------------------------------
Loss (Income) before income
 taxes               $ (322)        $   (194)  $     3            $  (513)
                    =======================================================
Identifiable assets  $   371         $20,353   $     -            $20,724
                     ==================================             ======
     1996
Sales to outside
  customers          $              $37,376    $ 3,321            $40,697
Other revenues           575            265        187              1,027
                    -----------------------------------------------------
Total revenues       $   575        $37,641    $ 3,508            $41,724
                    -----------------------------------------------------
Income before income
  taxes              $   898        $ 1,711    $    68            $ 2,677
                     ====================================================
Identifiable Assets  $   440        $19,412    $ 1,326            $21,178
                     =================================             ======

     1995
Sales to outside
   customers         $              $32,745    $ 2,598            $35,343
Other revenues         1,145             55        176              1,376
                    -----------------------------------------------------
Total revenues      $  1,145        $32,800    $ 2,774            $36,719
                    =====================================================
Income (loss) before income
     taxes          $    718       $    746    $   (34)           $ 1,430
                    =====================================================
Identifiable assets $    356        $14,411     $ 1,488           $16,255
                    ===================================            ======
</TABLE>



<TABLE>

                                               December 31
                                        1997            1996
Assets
Current assets:
     <S>                                <C>            <C>
     Cash                               $    532       $    386
     Accounts receivable from
        subsidiaries                         829             932
                                        ---------        -------
Total current assets                       1,361           1,318

Investments in subsidiaries                5,667           7,247
Other assets                                  15              22
                                        ---------        -------
                                        $  7,043         $ 8,587
                                         =====             =====

Liabilities and stockholders' equity
Current liabilities:
     Accounts payable                   $    17          $    11
     Accrued expenses                       140              198
                                          -------        --------
Total current liabilities                   157              209

Long-term debt                            1,049              979
Postretirement benefit liabilities          574              279
                                          -------        --------
Total liabilities                         1,780            1,467

Stockholders' equity
     Common stock                         1,223            1,221
     Additional paid-in capital           2,228            2,200
     Retained earnings (deficit)          3,030            3,595
     Equity adjustment from translation  (1,218)             104
                                        ---------        -------
                                          5,263            7,120
Commitments (Note 1)
                                          --------       --------
                                        $ 7,043          $ 8,587
                                         =====             =====
</TABLE>
<PAGE>
                     Driver-Harris Company

  Schedule I - Condensed Financial Information of Registrant

              Condensed Statements of Operations

                  Dollar Amounts in Thousands


<TABLE>
                                          Year Ended December 31
                                          1997            1996         1995
<S>                                    <C>            <C>           <C>
Fees from subsidiaries                 $    220       $    220      $   220
Fees from related company                                  500          500
Other income                                 54             75          685
                                          ----------------------------------
                                            274            795        1,405

Selling, general and administrative
    expenses                                638            707          745
Interest and financing expenses              70             69           82
Equity in net (gain) loss of related company                           (140)
Gain on sale of interest in Australian
  subsidiary                               (128)
Gain in connection with sale of foreign operations
    by related company                                    (895)
                                        ------------------------------------
(Loss) income before equity in net income
   (loss) of subsidiaries and income
    taxes                                  (306)           914         718

Equity in net (loss) income of
    subsidiaries                           (259)         1,538         614
                                        ------------------------------------
(Loss) income before income taxes          (565)         2,452        1,332

Income taxes
                                        -------------------------------------
Net (loss) income                        $  (565)       $2,452       $1,332
                                        ====================================
</TABLE>
<PAGE>
                      Driver-Harris Company

  Schedule I - Condensed Financial Information of Registrant

              Condensed Statements of Cash Flows
<TABLE>
                                          Year Ended December 31
                                          1997          1996      1995
Operating activities
<S>                                     <C>             <C>       <C>
Net (loss) income                       $  (565)        $2,452    $1,332
Adjustments to reconcile net (loss)
 income to net cash used in operating
 activities:
  Undistributed net income (loss) of
    subsidiaries                            259         (1,538)    (614)
  Provision for doubtful accounts                          114
  Non-cash compensation                      30             19
  Increase (reduction) in retirement
     benefit liability                      295             74     (212)
  Receivables from subsidiaries             103           (338)     (81)
  Accounts payable and accrued expenses     (52)           (73)     (65)
  Deferred credit                                         (968)    (298)
  Equity in related company                             (1,561)    (140)
  Elimination of equity adjustment from
     translation for foreign operations
     sold by related company                             1,634
  Account with related company                             253      (50)
  Sundry                                     6             (14)      15
                                      -----------------------------------
Net cash provided by used in operating
   activities                               76              54     (113)

Investing activities
Sundry                                                               15
                                      -------------------------------------
Net cash provided by (used in)
   investing activities                                              15

Financing activities
Change in short-term debt                                           (10)
Increase in long-term debt                  70              66       61
Issuance of capital stock                                  215
Sundry                                                       3
                                     --------------------------------------
Net cash provided by financing activities   70             284        51
                                     --------------------------------------
Net change in cash                         146             338       (47)
Cash at beginning of year                  386              48        95
                                     --------------------------------------
Cash at end of year                   $    532        $    386    $   48
                                     ======================================
Supplemental disclosure of cash flow information
Cash paid during the year for:
      Interest                        $     -         $      4     $   82
                                        ======           =====        ====
</TABLE>
<PAGE>
Driver-Harris Company

  Schedule I - Condensed Financial Information of Registrant

            Notes to Condensed Financial Statements


1.   Basis of Presentation

In the parent company only (Driver-Harris Company - U.S. Corporate Holding
Company) financial statements, the Company's investment in subsidiary (Irish
Driver-Harris Co. Ltd.) is stated at cost plus equity in undistributed
earnings of such subsidiaries since the date of acquisition. The Company's
share of net income of its unconsolidated subsidiaries is included
in consolidated income using the equity method.  The Driver-Harris Company -
U.S. Corporate Holding Company financial statements should be read in
conjunction with the Company's consolidated financial statements.
<PAGE>
            Driver-Harris Company and Subsidiaries

        Schedule II - Valuation and Qualifying Accounts

                  Dollar Amounts in Thousands
<TABLE>
   Col.A                        Col.B        Col.C         Col.D       Col.E
                                           Additions
                                              (1)
                              Balance at   Charged to                Balance
                              Beginning    Costs and    Deductions   at End
       Description            of Period    Expenses     Describe    of Period
Year ended December 31, 1997:
   Deducted from related asset:
       <S>                      <C>      <C>            <C>          <C>
       Tax valuation allowance  $ 2,440  $    120 (2)                $ 2,560
       Allowances for doubtful trade
     accounts                       408        76       $    78 (1)      406
                              ==============================================

Year ended December 31, 1996:
   Deducted from related asset:
     Tax valuation allowance   $ 2,470         -        $    30  (1) $ 2,440
     Allowances for doubtful trade
     accounts                      278    $   111           (19) (2)     408
                             ===============================================

Year ended December 31, 1995:
   Deducted from related asset:
       Tax valuation allowance $ 2,573          -       $    103 (1) $ 2,470
       Allowances for doubtful trade
     accounts                      376     $ (113)            15 (1)     278
                            ================================================
</TABLE>


(1) Accounts charged off during the year and adjustments due to currency
fluctuations.
(2) The change in valuation allowance is principally due to the change in
deferred tax assets.