---

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FORM 10-Q
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

|(Mark One)                                          |  |                                                                                                 
|--------------------------------------------------- |  | ------------------------------------------------------------------------------------------------
|/x/                                                 |  | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934     
|For the quarterly period ended December 31, 2001
OR
|/ /                                                 |  | TRANSITION REPORT PURSUANT TO THE SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934

For the transition period from  to

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Commission File Number 1-12541

LOGO

|Atchison Casting Corporation(Exact name of registrant as specified in its charter)
|----------------------------------------------------------------------------------

|Kansas(State of other jurisdiction of incorporation or organization) |  | 48-1156578(I.R.S. Employer Identification No.)
|-------------------------------------------------------------------- |  | ----------------------------------------------

|400 South Fourth Street, Atchison, Kansas(Address of principal executive offices) |  | 66002(Zip Code)
|--------------------------------------------------------------------------------- |  | ---------------

(Registrant's
telephone number, including area code) (913) 367-2121

|Not Applicable(Former name, former address and former fiscal year, if changed since last report.)
|-------------------------------------------------------------------------------------------------

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

There
were 7,723,031 shares of common stock, $.01 par value per share, outstanding on February 13, 2002

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ITEM 1. Financial Statements.

ATCHISON CASTING CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands, except share data)

|                                                                                                                          |                                                                                                                | December 31,
2001                                              |         | June 30,
2001 |        
|------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------- | ------- | ------------- | -------
|ASSETS                                                                                                                    |                                                                                                                |                                                                |         |               |        
|CURRENT ASSETS:                                                                                                           |                                                                                                                |                                                                |         |               |        
|                                                                                                                          | Cash and cash equivalents                                                                                      |                                                                | $       | 2,022         |        
|                                                                                                                          | Customer accounts receivable, net of allowance for doubtful accounts of $1,017 and $845, respectively          |                                                                |         | 70,140        |        
|                                                                                                                          | Inventories                                                                                                    |                                                                |         | 60,752        |        
|                                                                                                                          | Deferred income taxes                                                                                          |                                                                |         | 1,510         |        
|                                                                                                                          | Other current assets                                                                                           |                                                                |         | 8,907         |        
|                                                                                                                          |                                                                                                                |                                                                |         |               |        
|                                                                                                                          |                                                                                                                | Total current assets                                           |         |               | 143,331
|PROPERTY, PLANT AND EQUIPMENT, Net                                                                                        |                                                                                                                |                                                                | 108,058 |               |        
|INTANGIBLE ASSETS, Net                                                                                                    |                                                                                                                |                                                                | 23,385  |               |        
|DEFERRED FINANCING COSTS, Net                                                                                             |                                                                                                                |                                                                | 1,748   |               |        
|OTHER ASSETS                                                                                                              |                                                                                                                |                                                                | 14,404  |               |        
|                                                                                                                          |                                                                                                                |                                                                |         |               |        
|TOTAL                                                                                                                     |                                                                                                                | $                                                              | 290,926 |               | $      
|                                                                                                                          |                                                                                                                |                                                                |         |               |        
|LIABILITIES AND STOCKHOLDERS' EQUITY                                                                                      |                                                                                                                |                                                                |         |               |        
|CURRENT LIABILITIES:                                                                                                      |                                                                                                                |                                                                |         |               |        
|                                                                                                                          | Accounts payable                                                                                               |                                                                | $       | 50,642        |        
|                                                                                                                          | Accrued expenses                                                                                               |                                                                |         | 31,517        |        
|                                                                                                                          | Current maturities of long-term obligations                                                                    |                                                                |         | 108,656       |        
|                                                                                                                          |                                                                                                                |                                                                |         |               |        
|                                                                                                                          |                                                                                                                | Total current liabilities                                      |         |               | 190,815
|LONG-TERM OBLIGATIONS                                                                                                     |                                                                                                                |                                                                | 19,714  |               |        
|DEFERRED INCOME TAXES                                                                                                     |                                                                                                                |                                                                | 3,352   |               |        
|OTHER LONG-TERM OBLIGATIONS                                                                                               |                                                                                                                |                                                                | 621     |               |        
|EXCESS OF FAIR VALUE OF ACQUIRED NET ASSETS OVER COST, Net of accumulated amortization of $4,527 and $3,577, respectively |                                                                                                                |                                                                | 1,854   |               |        
|POSTRETIREMENT OBLIGATION OTHER THAN PENSION                                                                              |                                                                                                                |                                                                | 10,661  |               |        
|MINORITY INTEREST IN SUBSIDIARIES                                                                                         |                                                                                                                |                                                                | 1,115   |               |        
|                                                                                                                          |                                                                                                                |                                                                |         |               |        
|                                                                                                                          |                                                                                                                | Total liabilities                                              |         |               | 228,132
|STOCKHOLDERS' EQUITY:                                                                                                     |                                                                                                                |                                                                |         |               |        
|                                                                                                                          | Preferred stock, $.01 par value, 2,000,000 authorized shares; no shares issued and outstanding                 |                                                                |         |              |        
|                                                                                                                          | Common stock, $.01 par value, 19,300,000 authorized shares; 8,312,049 shares issued                            |                                                                |         | 83            |        
|                                                                                                                          | Class A common stock (non-voting), $.01 par value, 700,000 authorized shares; no shares issued and outstanding |                                                                |         |              |        
|                                                                                                                          | Additional paid-in capital                                                                                     |                                                                |         | 81,609        |        
|                                                                                                                          | Retained earnings (deficit)                                                                                    |                                                                |         | (4,312        | )      
|                                                                                                                          | Accumulated other comprehensive loss                                                                           |                                                                |         | (8,538        | )      
|                                                                                                                          |                                                                                                                |                                                                |         |               |        
|                                                                                                                          |                                                                                                                |                                                                | 68,842  |               |        
|                                                                                                                          | Less shares held in treasury:                                                                                  |                                                                |         |               |        
|                                                                                                                          |                                                                                                                | Common stock, 589,018 and 622,702 shares,respectively, at cost |         |               | (6,048 
|                                                                                                                          |                                                                                                                |                                                                |         |               |        
|                                                                                                                          |                                                                                                                | Total stockholders' equity                                     |         |               | 62,794 
|                                                                                                                          |                                                                                                                |                                                                |         |               |        
|TOTAL                                                                                                                     |                                                                                                                | $                                                              | 290,926 |               | $      
|                                                                                                                          |                                                                                                                |                                                                |         |               |        

See Notes to Consolidated Financial Statements.

2

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ATCHISON CASTING CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands, Except Share Data)
(Unaudited)

|                                                                                                                         |                                                                                  | Three Months Ended
December 31, |         | Six Months Ended
December 31, |       
|------------------------------------------------------------------------------------------------------------------------ | -------------------------------------------------------------------------------- | ------------------------------- | ------- | ----------------------------- | ------
|
|NET SALES                                                                                                                |                                                                                  | $                               | 100,071 |                               | $     
|COST OF GOODS SOLD                                                                                                       |                                                                                  |                                 | 91,906  |                               |       
|                                                                                                                         |                                                                                  |                                 |         |                               |       
|GROSS PROFIT                                                                                                             |                                                                                  |                                 | 8,165   |                               |       
|OPERATING EXPENSES:                                                                                                      |                                                                                  |                                 |         |                               |       
|                                                                                                                         | Selling, general and administrative                                              |                                 |         | 10,900                        |       
|                                                                                                                         | Amortization of intangibles                                                      |                                 |         | (95                           | )     
|                                                                                                                         | Other income, net                                                                |                                 |         |                               |       
|                                                                                                                         |                                                                                  |                                 |         |                               |       
|                                                                                                                         |                                                                                  | Total operating expenses        |         |                               | 10,805
|                                                                                                                         |                                                                                  |                                 |         |                               |       
|OPERATING (LOSS) INCOME                                                                                                  |                                                                                  |                                 | (2,640  | )                             |       
|INTEREST EXPENSE                                                                                                         |                                                                                  |                                 | 2,887   |                               |       
|MINORITY INTEREST IN NET INCOME (LOSS) OF SUBSIDIARIES                                                                   |                                                                                  |                                 | (10     | )                             |       
|                                                                                                                         |                                                                                  |                                 |         |                               |       
|INCOME (LOSS) BEFORE INCOME TAXES AND CUMULATIVE EFFECT OF A CHANGE IN ACCOUNTING PRINCIPLE                              |                                                                                  |                                 | (5,517  | )                             |       
|INCOME TAX EXPENSE (BENEFIT)                                                                                             |                                                                                  |                                 | 175     |                               |       
|                                                                                                                         |                                                                                  |                                 |         |                               |       
|INCOME BEFORE CUMULATIVE EFFECT OF A CHANGE IN ACCOUNTING PRINCIPLE                                                      |                                                                                  |                                 | (5,692  | )                             |       
|CUMULATIVE EFFECT ON PRIOR YEARS OF A CHANGE IN ACCOUNTING FOR DERIVATIVE FINANCIAL INSTRUMENTS, NET OF $364 TAX BENEFIT |                                                                                  |                                 |         |                               |       
|                                                                                                                         |                                                                                  |                                 |         |                               |       
|NET INCOME (LOSS)                                                                                                        |                                                                                  | $                               | (5,692  | )                             | $     
|                                                                                                                         |                                                                                  |                                 |         |                               |       
|INCOME (LOSS) PER SHARE  BASIC AND DILUTED:                                                                             |                                                                                  |                                 |         |                               |       
|                                                                                                                         | INCOME (LOSS) BEFORE CUMULATIVE EFFECT OF A CHANGE IN ACCOUNTING PRINCIPLE       |                                 | $       | (0.74                         | )     
|                                                                                                                         | CUMULATIVE EFFECT OF A CHANGE IN ACCOUNTING FOR DERIVATIVE FINANCIAL INSTRUMENTS |                                 |         |                               |       
|                                                                                                                         |                                                                                  |                                 |         |                               |       
|                                                                                                                         | NET INCOME (LOSS)                                                                |                                 | $       | (0.74                         | )     
|                                                                                                                         |                                                                                  |                                 |         |                               |       
|WEIGHTED AVERAGE NUMBER OF SHARES USED IN CALCULATION:                                                                   |                                                                                  |                                 |         |                               |       
|                                                                                                                         | BASIC                                                                            |                                 |         | 7,723,031                     |       
|                                                                                                                         |                                                                                  |                                 |         |                               |       
|                                                                                                                         | DILUTED                                                                          |                                 |         | 7,723,031                     |       
|                                                                                                                         |                                                                                  |                                 |         |                               |       

See
Notes to Consolidated Financial Statements.

3

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ATCHISON CASTING CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In Thousands)
(Unaudited)

|                                   |                                          | Three Months Ended
December 31, |        | Six Months Ended
December 31, |  
|---------------------------------- | ---------------------------------------- | ------------------------------- | ------ | ----------------------------- | -
|
|NET INCOME (LOSS)                  |                                          | $                               | (5,692 | )                             | $
|OTHER COMPREHENSIVE INCOME (LOSS): |                                          |                                 |        |                               |  
|                                   | Foreign currency translation adjustments |                                 |        | (1,209                        | )
|                                   |                                          |                                 |        |                               |  
|OTHER COMPREHENSIVE INCOME (LOSS)  |                                          | $                               | (6,901 | )                             | $
|                                   |                                          |                                 |        |                               |  

See
Notes to Consolidated Financial Statements.

4

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ATCHISON CASTING CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOW
(In Thousands)
(Unaudited)

|                                                     |                                                                          | Six Months Ended
December 31,                                                                       |                                               
|---------------------------------------------------- | ------------------------------------------------------------------------ | --------------------------------------------------------------------------------------------------- | ----------------------------------------------
|
|CASH FLOWS FROM OPERATING ACTIVITIES:                |                                                                          |                                                                                                     |                                               
|                                                     | Net Loss                                                                 |                                                                                                     | $                                             
|                                                     | Adjustments to reconcile net loss to net cash from operating activities: |                                                                                                     |                                               
|                                                     |                                                                          | Depreciation and amortization                                                                       |                                               
|                                                     |                                                                          | Minority interest in net income (loss) of subsidiaries                                              |                                               
|                                                     |                                                                          | Gain on disposal of capital assets                                                                  |                                               
|                                                     |                                                                          | Deferred income taxes                                                                               |                                               
|                                                     |                                                                          | Changes in assets and liabilities (exclusive of effects of the sale of net assets of a subsidiary): |                                               
|                                                     |                                                                          |                                                                                                     | Receivables                                   
|                                                     |                                                                          |                                                                                                     | Inventories                                   
|                                                     |                                                                          |                                                                                                     | Other current assets                          
|                                                     |                                                                          |                                                                                                     | Accounts payable                              
|                                                     |                                                                          |                                                                                                     | Accrued expenses                              
|                                                     |                                                                          |                                                                                                     | Post retirement obligations other than pension
|                                                     |                                                                          |                                                                                                     | Other                                         
|                                                     |                                                                          |                                                                                                     |                                               
|                                                     |                                                                          |                                                                                                     |                                               
|                                                     |                                                                          |                                                                                                     |                                               
|CASH FLOWS FROM INVESTING ACTIVITIES:                |                                                                          |                                                                                                     |                                               
|                                                     | Capital expenditures                                                     |                                                                                                     |                                               
|                                                     | Proceeds from sale of capital assets                                     |                                                                                                     |                                               
|                                                     | Proceeds from sale of net assets of a subsidiary operation               |                                                                                                     |                                               
|                                                     | Payments for purchase of stock in subsidiaries                           |                                                                                                     |                                               
|                                                     |                                                                          |                                                                                                     |                                               
|                                                     |                                                                          |                                                                                                     |                                               
|                                                     |                                                                          |                                                                                                     |                                               
|CASH FLOWS FROM FINANCING ACTIVITIES:                |                                                                          |                                                                                                     |                                               
|                                                     | Proceeds from issuance of common stock, net of costs                     |                                                                                                     |                                               
|                                                     | Payments on long-term obligations                                        |                                                                                                     |                                               
|                                                     | Capitalized financing costs paid                                         |                                                                                                     |                                               
|                                                     | Net borrowings                                                           |                                                                                                     |                                               
|                                                     |                                                                          |                                                                                                     |                                               
|                                                     |                                                                          |                                                                                                     |                                               
|                                                     |                                                                          |                                                                                                     |                                               
|EFFECT OF EXCHANGE RATE ON CASH                      |                                                                          |                                                                                                     | 25                                            
|                                                     |                                                                          |                                                                                                     |                                               
|NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS |                                                                          | $                                                                                                   | 693                                           
|CASH AND CASH EQUIVALENTS, Beginning of period       |                                                                          |                                                                                                     | 1,329                                         
|                                                     |                                                                          |                                                                                                     |                                               
|CASH AND CASH EQUIVALENTS, End of period             |                                                                          | $                                                                                                   | 2,022                                         
|                                                     |                                                                          |                                                                                                     |                                               

See
Notes to Consolidated Financial Statements.

5

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ATCHISON CASTING CORPORATION AND SUBSIDIARIES  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.    Accounting Policies and Basis of Presentation

The unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements of Atchison Casting Corporation and
subsidiaries (the "Company") for the year ended June 30, 2001, as included in the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 2001.

The
accompanying unaudited consolidated financial statements include all adjustments (consisting only of normal recurring accruals), which, in the opinion of management, are necessary
for a fair presentation of financial position, results of operations and cash flows. Results of operations for interim periods are not necessarily indicative of results to be expected for a full year.

Certain
December 31, 2000 amounts have been reclassified to conform with December 31, 2001 classifications.

2.    Inventories

As ofDec. 31,
2001

June 30,
2001(Thousands)Raw materials

$
6,418

$
7,587Work-in-process


44,626


38,889Finished goods


6,737


10,138Supplies


2,971


2,003$
60,752

$
58,617


3.    Income Taxes

Income tax expense (benefit) consisted of:

Six Months Ended
Dec. 31,2001

2000(Thousands)Current:Domestic

$


$
(1,193
)Foreign


376


951376


(242
)Deferred:Domestic





(207
)Foreign


(20
)

(576
)(20
)

(783
)Total

$
356

$
(1,025
)


6

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4.    Supplemental Cash Flow Information

Six Months Ended
Dec. 31,2001

2000(Thousands)Cash paid during the period for:Interest

$
6,051

$
5,683Income Taxes

$


$
603


7

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5.    Earnings Per Share

Following is a reconciliation of basic and diluted EPS.

For the three months ended December 31, 2001

|                               |                                       | Net Loss |            | Weighted
Average Shares |           | Earnings Per
Share |  
|------------------------------ | ------------------------------------- | -------- | ---------- | ----------------------- | --------- | ------------------ | -
|Basic EPS                      |                                       |          |            |                         |           |                    |  
|                               | Loss available to common stockholders |          | $          | (5,692,000              | )         | 7,723,031          |  
|Effect of Dilutive Securities: |                                       |          |            |                         |           |                    |  
|                               | Options                               |          |            |                         |           |                    |  
|                               |                                       |          |            |                         |           |                    |  
|Diluted EPS                    |                                       | $        | (5,692,000 | )                       | 7,723,031 |                    | $
|                               |                                       |          |            |                         |           |                    |  

For the three months ended December 31, 2000

|                               |                                         | Net Loss |           | Weighted
Average Shares |           | Earnings Per
Share
|------------------------------ | --------------------------------------- | -------- | --------- | ----------------------- | --------- | ------------------
|Basic EPS                      |                                         |          |           |                         |           |                   
|                               | Income available to common stockholders |          | $         | 1,856,000               |           | 7,689,347         
|Effect of Dilutive Securities: |                                         |          |           |                         |           |                   
|                               | Options                                 |          |           |                         |           |                   
|                               |                                         |          |           |                         |           |                   
|Diluted EPS                    |                                         | $        | 1,856,000 |                         | 7,689,347 |                   
|                               |                                         |          |           |                         |           |                   

For the six months ended December 31, 2001

|                               |                                       | Net Loss |             | Weighted
Average Shares |           | Loss Per
Share |  
|------------------------------ | ------------------------------------- | -------- | ----------- | ----------------------- | --------- | -------------- | -
|Basic EPS                      |                                       |          |             |                         |           |                |  
|                               | Loss available to common stockholders |          | $           | (10,175,000             | )         | 7,710,032      |  
|Effect of Dilutive Securities: |                                       |          |             |                         |           |                |  
|                               | Options                               |          |             |                         |           |                |  
|                               |                                       |          |             |                         |           |                |  
|Diluted EPS                    |                                       | $        | (10,175,000 | )                       | 7,710,032 |                | $
|                               |                                       |          |             |                         |           |                |  

For the six months ended December 31, 2000

|                               |                                                                                                                                                 | Net Loss |            | Weighted
Average Shares |           | Loss Per
Share |  
|------------------------------ | ----------------------------------------------------------------------------------------------------------------------------------------------- | -------- | ---------- | ----------------------- | --------- | -------------- | -
|Basic EPS                      |                                                                                                                                                 |          |            |                         |           |                |  
|                               | Loss before cumulative effect of a change in accounting principle available to common stockholders                                              |          | $          | (3,464,000              | )         | 7,681,390      |  
|                               | Cumulative effect on prior years (to June 30, 2000) of a change in accounting for derivative financial instruments, net of $364,000 tax benefit |          |            | (546,000                | )         |                |  
|Effect of Dilutive Securities: |                                                                                                                                                 |          |            |                         |           |                |  
|                               | Options                                                                                                                                         |          |            |                         |           |                |  
|                               |                                                                                                                                                 |          |            |                         |           |                |  
|Diluted EPS                    |                                                                                                                                                 | $        | (4,010,000 | )                       | 7,681,390 |                | $
|                               |                                                                                                                                                 |          |            |                         |           |                |  

8

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6.    Derivative Instruments

Effective July 1, 2000, the Company adopted Statement of Financial Accounting Standards ("SFAS") No. 133, "Accounting for Derivative Instruments and
Hedging Activities" and SFAS No. 138, "Accounting for Certain Derivative Instruments and Certain Hedging Activities, an amendment of the Financial Accounting Standards Board ("FASB") Statement
No. 133." This is presented in the Company's consolidated financial statements as the cumulative effect of a change in accounting principle.

On
December 31, 2000, the Company recorded its foreign exchange contracts ("FX contracts") at their fair value of approximately $(272,000). This resulted in a loss of
approximately $182,000. Additionally, the translation of the foreign denominated trade receivables resulted in an increase in the value of the receivables and the Company recorded a currency
translation gain of approximately $145,000.

On
December 31, 2001, the Company did not have any FX Contracts in place.

7.    Closures, Sales and Asset Impairments

LA Die Casting

The Company entered an agreement on January 11, 2002 for the sale of substantially all of the assets of LA Die Casting, Inc. ("LA Die Casting"),
subject to buyer financing and certain other contingencies. Under the terms of the agreement, the Company will receive approximately $3.5 million in cash and a note for the principal amount of
$500,000 due in two years in exchange for assets and the assumption of liabilities by the buyer, subject to post-closing adjustments. If consummated, it is anticipated that this transaction would
close during the third quarter of fiscal 2002.

For
the second quarter of fiscal years 2001 and 2002, LA Die Casting recorded net sales of $2.0 million and $1.7 million, respectively, and net income of $11,000, and
$9,000, respectively. For the first half of
fiscal years 2001 and 2002, LA Die Casting recorded net sales of $4.5 million and $3.6 million, respectively, and net income (loss) of $58,000, and $(15,000), respectively.

Jahn Foundry

On December 20, 2001, the Company completed the sale of substantially all of the assets of Jahn Foundry Corp. ("Jahn Foundry"). Under the terms of the
sale, the Company received approximately $300,000 in cash, a minority ownership position in the buyer and a note receivable in exchange for assets and the assumption of liabilities by the buyer,
subject to post-closing adjustments. No gain or loss was recognized on the sale of Jahn Foundry.

For
the second quarter of fiscal years 2001 and 2002, Jahn Foundry recorded net sales of $1.8 million and $1.3 million, respectively, and net losses of $740,000 and
$440,000, respectively. For the first half of fiscal 2001, Jahn Foundry recorded a net loss of $1.5 million, excluding a non-recurring gain of $10.9 million recorded in the second
quarter relating to insurance claims resulting from an industrial accident at Jahn Foundry on February 25, 1999, on sales of $3.8 million. For the first half of fiscal 2002, Jahn Foundry
recorded a net loss of $823,000 on sales of $2.9 million.

Empire Steel

The Company substantially completed the closure of Empire by December 31, 2001, and transferred as much work as possible to other locations. For the second
quarter of fiscal years 2001 and 2002, Empire recorded net sales of $2.4 million and $1.9 million, respectively, and net losses of $705,000 and $223,000, respectively. For the first half
of fiscal years 2001 and 2002, Empire recorded net sales of $4.7 million and $4.1 million, respectively, and net losses of $1.4 million and $704,000, respectively.

The
Company may recognize certain other exit costs associated with the closure of Empire in fiscal 2002 related to employee termination costs.

9

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8.    New Accounting Standards

The FASB has recently issued SFAS No. 141,"Business Combinations", SFAS No. 142 "Goodwill and Other
Intangible Assets", SFAS No. 143"Accounting for Asset Retirement
Obligations"and SFAS No. 144 "Accounting for the Impairment or Disposal of Long-Lived Assets". SFAS No. 141 requires that the purchase method of accounting be used for
all
business combinations initiated after June 30, 2001 and that the use of the pooling-of-interest method is no longer allowed. SFAS No. 142 requires that upon adoption, amortization of
goodwill will cease and instead, the carrying value of goodwill will be evaluated for impairment on an annual basis. Identifiable intangible assets will continue to be amortized over their useful
lives and reviewed for impairment in accordance with SFAS No. 121"Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed
Of". SFAS No. 143 establishes accounting standards for recognition and measurement of a liability for an asset retirement obligation and the associated asset retirement
cost. SFAS No. 144 supercedes SFAS No. 121 and establishes accounting standards for long-lived assets and long-lived assets to be disposed of. SFAS Nos. 142 and 144 are effective for
fiscal years beginning after December 15, 2001 and SFAS No. 143 is effective for fiscal years beginning after June 15, 2002, so the Company will adopt these standards as of
July 1, 2002. The Company is evaluating the impact of the adoption of these standards and has not yet determined the effect of adoption on its financial position and results of operations.

9.    Loan Amendments

In September 2001, Atchison Casting UK Limited ("ACUK"), a subsidiary of the Company, and Burdale Financial Limited ("Burdale"), an affiliate of Congress
Financial Corporation, entered into a new financing agreement (the "Facility Agreement"). This Facility Agreement provides for a facility of up to 25 million British pounds (approximately
$35 million US), subject to certain eligibility calculations, to be used to fund working capital requirements at Sheffield Forgemasters Group, Ltd. ("Sheffield"), a subsidiary of ACUK, and up
to $1.0 million British pounds for working capital at Fonderie d'Autun ("Autun"), the Company's subsidiary in France. In addition, the Facility Agreement will provide security for Sheffield's
foreign currency exchange contracts and performance bond commitments and was used to repay $5.0 million of intercompany working capital loans. This facility matures on September 17, 2004
and is secured by substantially all of Sheffield's assets in the U.K. Loans under this Facility Agreement will bear interest at LIBOR plus 2.60%. As of December 31, 2001, ACUK had drawn
$13.2 million under the Facility Agreement, and there was approximately $3.4 million available for borrowing.

On
December 18, 2001, the Company and Harris Trust and Savings Bank, as agent for several lenders, entered into the Twelfth Amendment and Forebearance Agreement to the revolving
credit facility ("Credit Agreement"). The Twelfth Amendment, as amended, provides that, among other things, these lenders will forbear from enforcing their rights with respect to certain existing
defaults through June 30, 2002. The Twelfth Amendment consists of a $75.5 million revolving credit facility decreasing to $72.5 million on February 28, 2002 and to
$70.5 million on March 31, 2002. Asset sales and tax refunds are expected to be used to reduce indebtedness. Secured by substantially all of the Company's North American assets, loans
under this credit facility bear interest at prime plus 2.0%. A new covenant regarding operating cash flow (minimum cumulative earnings before interest, taxes, amortization and depreciation) has also
been added. At December 31, 2001, the Company had fully utilized its revolving credit facility under the Credit Agreement.

On
December 18, 2001, the Company and the insurance company holding the senior notes (the "Notes") entered the Ninth Amendment and Forbearance Agreement to the Note Purchase
Agreement. The Ninth Amendment, as amended, provides that, among other things, the Noteholder
will forbear from enforcing its rights with respect to certain existing defaults through June 30, 2002. Secured by substantially all of the Company's North American assets, the Notes bear
interest at

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10.44%. A new covenant regarding operating cash flow (minimum cumulative earnings before interest, taxes, amortization and depreciation) has also been added.

The
Company is currently negotiating with new and existing lenders to extend its current arrangements while it attempts to establish a new credit facility with covenants that the Company
believes it will be able to satisfy and additional borrowing capacity.

10.    Contingencies

An accident, involving an explosion and fire, occurred on February 25, 1999, at Jahn Foundry, located in Springfield, Massachusetts. Nine employees were
seriously injured and there were three fatalities. The damage was confined to the shell molding area and boiler room. The other areas of the foundry remained operational. Molds were being produced at
other foundries, as well as Jahn Foundry, while repairs were made. The new shell molding department became operational in November 2000.

The
Company carries insurance for property and casualty damages (over $475 million of coverage), business interruption (approximately $115 million of coverage), general
liability ($51 million of coverage) and workers' compensation (up to full statutory liability) for itself and its subsidiaries. The Company recorded charges of $750,000 during the third quarter
of fiscal 1999, primarily reflecting the deductibles under the Company's various insurance policies. At this time there can be no assurance that the Company's ultimate costs and expenses resulting
from the accident will not exceed available insurance coverage by an amount which could be material to its financial condition or results of operations and cash flows.

In
November 2000, the Company and its insurance carrier settled the Jahn Foundry property portion of the Company's claim. The settlement provided, among other things, for
(i) additional payments from the carrier in the amount of $2.6 million, (ii) that of the payments received to date, totaling $26.8 million, the insurance carrier will
allocate no more than $9.5 million for property damage, (iii) that the remaining proceeds of $17.3 million will be allocated to business interruption losses and will not be
subject to recovery by the insurance carrier and (iv) that the Company shall not be entitled to any additional payments unless it is determined by reference, appraisal, arbitration, litigation
or otherwise that the Company's business interruption losses exceed $17.3 million. The Company disagrees with the insurance carrier regarding the duration and amount of the business
interruption losses. The Company plans to seek additional insurance payments through arbitration expected to occur during the latter part of calendar 2002. There can be no assurance that the Company
will ultimately receive any additional insurance payments or that the excess of the Company's costs and expenses resulting from the accident over the insurance payments received will not be material
to its financial condition or results of operations and cash flows.

As
a result of the above settlement, the Company recorded a non-recurring gain of $10.9 million in the second quarter of fiscal 2001, which consisted of a $3.7 million
business interruption insurance gain and a $7.2 million property insurance gain. The property insurance gain primarily represents the difference between the net proceeds received for the
property damage and the property's net book value immediately before the accident. These net proceeds were used to rebuild the damaged property and were accounted for as capital expenditures.

A
civil action has been commenced in Massachusetts Superior State Court on behalf of the estates of deceased workers, their families, injured workers and their families, against the
supplier of a chemical compound used in Jahn Foundry's manufacturing process. The supplier of the chemical compound, Borden Chemical, Inc., filed a Third Party Complaint against Jahn Foundry in
Massachusetts Superior State Court on February 2, 2000 seeking indemnity for any liability it has to the

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plaintiffs in the civil action. The Company's comprehensive general liability insurance carrier has retained counsel on behalf of Jahn Foundry, and the Company and is aggressively defending Jahn
Foundry in the Third Party Complaint. It is too early to assess the potential liability to Jahn Foundry for the Third Party Complaint, which in any event Jahn Foundry will aggressively defend. In
addition, Jahn Foundry has brought a Third Party Counterclaim against Borden and the independent sales representative of the chemical compound, J.R. Oldhan Company, seeking compensation for losses
sustained in the explosion, including amounts covered by insurance.

On
February 26, 2001, Borden filed a Third Party Complaint against the Company seeking contribution, under Massachusetts law, from the Company in the event that the plaintiffs
prevail against Borden. The Third Party Complaint alleges that the Company undertook a duty to oversee industrial hygiene, safety and maintenance at Jahn Foundry and that the Company designed,
installed and maintained equipment and machinery at Jahn Foundry, and that the Company's carelessness, negligence or gross negligence caused the explosion and resulting injuries. It is too early to
assess the potential liability for such a claim, which in any event the Company will aggressively defend.

On
March 30, 2001, the plaintiffs amended their complaint by adding the Company as a defendant. The plaintiffs allege that the Company undertook a duty to oversee industrial
hygiene, safety and maintenance at Jahn Foundry and that the Company's carelessness, negligence or gross negligence caused the explosion and resulting injuries. The plaintiffs seek an unspecified
amount of damages and punitive damages. It is too early to assess the potential liability to the Company for such claims, which in any event the Company will aggressively defend. The Company has filed
a cross-claim for contribution against Borden and J.R. Oldhan Company.

On
December 20, 2001, the Company completed the sale of substantially all of the assets of Jahn Foundry (Note 7). However, the Company did not sell its right to any
proceeds from any insurance settlement, arbitration, litigation or any proceeding relating to the industrial accident discussed above, nor did the buyer assume any such liabilities.

The
Company, its chief executive officer, and its chief financial officer were named as defendants in five lawsuits filed following the Company's announcements concerning the discovery
of accounting irregularities at the Pennsylvania Foundry Group. The cases have been consolidated before the U.S. District Court for the District of Kansas. An amended complaint filed after the
consolidation alleges, among other things, that the defendants intentionally or recklessly issued materially false and misleading financial statements in violation of Section 10(b) of the
Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. That complaint seeks certification of a class of purchasers of the Company's common stock between December 10, 1997
and November 3, 2000 and asks for damages for the class in an unspecified amount. An agreement in principle has been reached to settle the case. The settlement, which is subject to the execution of
definitive settlement documents and Court approval, calls for the establishment of a settlement fund consisting of $1.8 million, which will be paid by the Company's insurance carrier. All
claims will be dismissed without any admission of liability or wrongdoing.

The
Company understands that on or about November 29, 2000 the Securities and Exchange Commission issued a formal order of investigation as a result of the events underlying the
Company's earlier disclosure of certain accounting irregularities. The Company is cooperating with the investigation.

In
addition to these matters, from time to time, the Company is the subject of legal proceedings, including employee matters, commercial matters, environmental matters and similar claims
in the

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normal course of business. In the opinion of management, the resolution of these matters will not have a material effect on the Company's consolidated financial statements.

The
Company acquired Autun in France on February 25, 1999. Autun specialized in the manufacture of cast iron radiators and boiler castings. The Company's strategy for Autun was to
restructure the foundry to diversify into other products, principally automotive products. Autun has made progress in diversifying into automotive and other products. However, the start-up costs have
been high. In the first six months of fiscal 2001, Autun recorded a net loss of $190,000 on sales of $8.1 million. In the first six months of fiscal 2002, Autun has recorded a net loss of
$1.6 million on sales of $8.3 million.

The
Company contractually assumed certain contingent liabilities when it purchased Autun. This contingency includes (i) the cost of employee severance payments and (ii) the
cost of environmental cleanup/restoration, if any, in the event that the foundry was to be closed. The Company currently plans to continue operating Autun. However, Autun must fund its working capital
needs internally, as the Credit Agreement, Note Purchase Agreement and the Facility Agreement prohibit the Company from transferring funds to Autun to cover operating losses. If Autun were unable to
fund its own operations, there is a risk that it would have to cease operations, and may become subject to the above liabilities. The Company estimates that the liability could total up to
$20 million over a period of time.

11.    Financial Results and Management's Plans

In fiscal 2001, the Company incurred a pre-tax loss of $34.5 million ($16.4 million excluding impairments charges of $18.1 million) and, as
of December 31, 2001, the Company was not in compliance with certain financial covenants included in its debt agreements (See Note 9). These conditions have continued through
December 31, 2001.

To
address these conditions, management has taken or is in the process of taking the following actions:

Operations

The Company has closed four unprofitable foundries during fiscal 2001 and fiscal 2002. Operations from these four foundries have been a major factor in the
Company's pre-tax losses, producing combined pretax losses in fiscal 2001 of $17.1 million ($15.5 million before impairment charges of $1.6 million). Management has transferred a
significant portion of the work previously performed by these locations to other foundries, thereby increasing the utilization and profitability of these other foundries.

Sale of Operations

The Company completed the sale of substantially all of the assets of Jahn Foundry on December 20, 2001 (Note 7).

Planned Sale of Operations

The Company entered an agreement on January 11, 2002 to sell substantially all of the assets of LA Die Casting, subject to buyer financing and other
contingencies (Note 7).

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Other Actions

Management continues to pursue new or revised long-term debt arrangements with terms and covenants acceptable to the Company and to the lenders. As discussed in
Note 9, over the past few years the Company has successfully negotiated with its lenders to obtain amendments, forbearances and waivers for violations of various covenants of its loan
agreements, and the lenders have demonstrated a history of working with the Company in providing an adequate credit facility to meet its ongoing needs, and the Company currently has forbearance
agreements which expire June 30, 2002. The Company believes that its operating cash flow and amounts available for borrowing under its existing credit facility and the Facility Agreement will
be adequate to fund its capital expenditure and working capital requirements through June 2002.

Management
believes, however, that certain of the existing loan arrangements will need to be revised or replaced to provide the Company with additional borrowing capacity and with
financial covenants within such arrangements that are achievable by the Company. Management is currently in negotiations with various financial institutions to extend, renegotiate or replace the
current credit agreements with a long-term credit facility, but there can be no assurance that management will be successful in these negotiations.

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ITEM 2.

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

Results of Operations:

Net sales for the second quarter of fiscal 2002 were $100.1 million, representing a decrease of $5.7 million, or 5.4%, from net sales of $105.8 million in the
second quarter of fiscal 2001. The decrease in net sales was due primarily to the closure of three operations. During fiscal 2001, Atchison Casting Corporation (the "Company") completed the closure of
Claremont Foundry, Inc. ("Claremont"), PrimeCast, Inc. ("PrimeCast") and Pennsylvania Steel Foundry & Machine Company ("Pennsylvania Steel"). Net sales for the second quarter of fiscal 2001 for
Claremont, PrimeCast and Pennsylvania Steel were $463,000, $5.6 million and $1.7 million, respectively. Much of Claremont's and Pennsylvania Steel's net sales were transferred to other Company
locations. As PrimeCast was the Company's only foundry that could produce large iron castings, only a portion of PrimeCast's work was transferred to other operations of the Company. Partially
offsetting the impact of these closures, was an increase in net sales to the mining, automotive and power generation markets.

Net
sales for the first six months of fiscal 2002 were $199.7 million, representing a decrease of $5.3 million, or 2.6%, from net sales of $205.0 million in the first six months of
fiscal 2001. The decrease in net sales was due primarily to the closure of Claremont, PrimeCast and Pennsylvania Steel. Net sales for the first six months of fiscal 2001 for Claremont, PrimeCast and
Pennsylvania Steel were $816,000, $10.3 million and $3.8 million, respectively. Partially offsetting the impact of these closures, was an increase in net sales to the mining, automotive and power
generation markets.

Gross
profit for the second quarter of fiscal 2002 increased $116,000, or 14.4%, to $8.2 million, or 8.2% of net sales, compared to $8.1 million, or 7.6% of net sales, for the second
quarter of fiscal 2001. The
increase in gross profit and gross profit as a percentage of net sales was primarily due to the elimination of the gross losses incurred at the operations closed during fiscal 2001 and improved
operations at the Company's Jahn Foundry Corp. ("Jahn Foundry") subsidiary, partially offset by reduced gross profits at Sheffield Forgemasters Group Limited ("Sheffield").

The
gross losses at Claremont, PrimeCast and Pennsylvania Steel in the second quarter of fiscal 2002 decreased by an aggregate of $726,000 over the gross losses at these locations in the
second quarter of fiscal 2001. The gross loss at Jahn Foundry in the second quarter of fiscal 2002 decreased $671,000, to a gross loss of $503,000, or 39.1% of net sales, compared to a gross loss of
$1.2 million, or 65.6% of net sales, in the second quarter of fiscal 2001, reflecting improved operations following the start-up of the shell mold department, which had been shutdown following the
industrial accident there in February 1999. Offsetting these factors were reduced gross profits at Sheffield. The gross profit at Sheffield in the second quarter of fiscal 2002 decreased $1.1
million, to a gross profit of $1.6 million, or 6.3% of net sales, compared to a gross profit of $2.8 million, or 10.7% of net sales, in the second quarter of fiscal 2001, primarily reflecting the
impact of the strengthening British pound and the competitive environment of markets served by Sheffield on quoted margins.

Gross
profit for the first six months of fiscal 2002 increased $3.5 million, or 29.4%, to $15.6 million, or 7.8% of net sales, compared to $12.1 million, or 5.9% of net sales, for the
first six months of fiscal 2001. The increase in gross profit and gross profit as a percentage of net sales was primarily due to the elimination of the gross losses incurred at the operations closed
during fiscal 2001, improved operations at the Company's Jahn Foundry subsidiary and increased sales and absorption of overhead at the Company's subsidiaries primarily serving the mining, steel,
automotive and power generation markets.

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The
gross losses at Claremont, PrimeCast and Pennsylvania Steel in the first six months of fiscal 2002 decreased by an aggregate of $2.6 million over the gross losses at these locations
in the first six months of fiscal 2001. The gross loss at Jahn Foundry in the first six months of fiscal 2002 decreased $1.4 million, to a gross loss of $878,000, or 30.7% of net sales, compared to a
gross loss of $2.3 million, or 59.7% of net sales, in the first six months of fiscal 2001, reflecting improved operations following the start-up of the shell mold department, which had been shutdown
following the industrial accident there in February 1999. The gross profit at Sheffield in the first six months of fiscal 2002 decreased $991,000, to a gross profit of $3.7 million, or 6.8% of
net sales, compared to a gross profit of $4.7 million, or 9.4% of net sales, in the first six months of fiscal 2001, primarily reflecting the impact of the strengthening British pound and the
competitive environment of markets served by Sheffield on quoted margins.

Selling,
general and administrative expense ("SG&A") for the second quarter of fiscal 2002 was $10.9 million, or 10.9% of net sales, compared to $12.2 million, or 11.6% of net sales, in
the second quarter of fiscal 2001. For the first six months of fiscal 2002, SG&A was $20.1 million, or 10.1% of net sales, compared to $21.7 million, or 10.6% of net sales, or the first six months of
fiscal 2001. The reduction in S,G&A expense in both periods is primarily due to the reduction in S,G&A expense at the facilities the Company closed during fiscal 2001. Also included in the second
quarter and first six months of
fiscal 2001 were expenses of approximately $480,000 relating to the investigation of the accounting irregularities at the Company's Pennsylvania Foundry Group of operations.

The
Company has recorded intangible assets, consisting of goodwill, in connection with certain of the Company's acquisitions. Amortization of these assets for the second quarter of
fiscal 2002 was expense of $309,000, or 0.3% of net sales, as compared to $337,000, or 0.3% of net sales, in the second quarter of fiscal 2001. Amortization of these assets for the first six months of
fiscal 2002 was expense of $616,000, or 0.3% on net sales, as compared to $677,000, or 0.3% of net sales, in the first six months of fiscal 2001. The Company has also recorded a liability, consisting
of the excess of acquired net assets over cost ("negative goodwill"), in connection with the acquisition of Fonderie d'Autun ("Autun"). The amortization of negative goodwill was a credit to income in
the second quarter of fiscal 2002 of $404,000, or 0.4% of net sales, as compared to $389,000, or 0.4% of net sales, in the second quarter of fiscal 2001. The amortization of negative goodwill was a
credit to income in the first six months of fiscal 2002 of $805,000, or 0.4% of net sales, as compared to $797,000, or 0.4% of net sales, in the first six months of fiscal 2001.

Other
income for the second quarter and first six months of fiscal 2001 was $10.9 million, which is a non-recurring gain consisting of $3.7 million and $7.2 million against the Company's
business interruption and property damage claims, respectively, relating to the industrial accident at Jahn Foundry on February 25, 1999. The property insurance gain primarily represents the
difference between the net proceeds received for the property damage and the property's net book value immediately before the accident. (see Note 7)

The
Company substantially completed the closure of Empire by December 31, 2001, and transferred as much work as possible to other locations. For the second quarter of fiscal years
2001 and 2002, Empire recorded net sales of $2.4 million and $1.9 million, respectively, and net losses of $705,000 and $223,000, respectively. For the first half of fiscal years 2001 and 2002, Empire
recorded net sales of $4.7 million and $4.1 million, respectively, and net losses of $1.4 million and $704,000, respectively. The Company may recognize certain other exit costs associated with the
closure of Empire in fiscal 2002 related to employee termination costs.

The
Company entered an agreement on January 11, 2001 for the sale of substantially all of the assets of LA Die Casting, Inc. ("LA Die Casting"), subject to buyer financing
and other contingencies. Under the terms of the agreement, the Company will receive approximately $3.5 million in cash and a note in the principal amount of $500,000 due in two years in exchange for
assets and the assumption of

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liabilities by the buyer, subject to post-closing adjustments. If consummated, it is anticipated that this transaction would close during the third quarter of fiscal 2002. For the second quarter of
fiscal years 2001 and 2002, LA Die Casting recorded net sales of $2.0 million and $1.7 million, respectively, and net income of $11,000, and $9,000, respectively. For the first half of fiscal years
2001 and 2002, LA Die Casting recorded net sales of $4.5 million and $3.6 million, respectively, and net income (loss) of $58,000, and $(15,000), respectively.

On
December 20, 2001, the Company completed the sale of substantially all of the assets of Jahn Foundry. Under the terms of the sale, the Company received approximately $300,000
in cash, a minority ownership position in the buyer and a note receivable in exchange for assets and the assumption of liabilities by the buyer, subject to post-closing adjustments. For the second
quarter of fiscal years 2001 and 2002, Jahn Foundry recorded net sales of $1.8 million and $1.3 million, respectively, and net losses of $740,000 and $440,000, respectively. For the first half of
fiscal 2001, Jahn Foundry recorded a net loss of $1.5 million, excluding a non-recurring gain of $10.9 million recorded in the second quarter relating to insurance claims resulting from an industrial
accident at Jahn Foundry on February 25, 1999, on sales of $3.8 million. For the first half of fiscal 2002, Jahn Foundry recorded a net loss of $823,000 on sales of $2.9 million.

Interest
expense for the second quarter of fiscal 2002 was $2.9 million, or 2.9% of net sales, compared to $2.9 million, or 2.8% of net sales, in the second quarter of fiscal 2001.
Interest expense for the first six months of fiscal 2002 was $5.5 million, or 2.8% of net sales, compared to $5.6 million, or 2.7% of net sales, in the first six months of fiscal 2001. The interest
expense primarily reflects higher average levels of outstanding indebtedness, offset by lower average interest rates.

The
Company recorded income tax expense of $175,000 and $356,000 in the second quarter and first six months of fiscal 2002, respectively. Due to the Company's current income tax
position, no income tax benefit was recorded in connection with the losses incurred. Income tax expense (benefit) of $2.0 million and $(661,000) was recorded in the second quarter and first six months
of fiscal 2001, respectively. The Company's income tax expense and benefit for the second quarter and first six months of fiscal 2001 reflect the combined effective tax rates of the different federal,
state and provincial jurisdictions in which the Company operates, and the proportion of taxable income earned in each of those tax jurisdictions.

Effective
July 1, 2000, the Company adopted Statement of Financial Accounting Standards ("SFAS") No. 133, "Accounting for Derivative Instruments and Hedging Activities" and SFAS
No. 138, "Accounting for Certain Derivative Instruments and Certain Hedging Activities, an amendment of the Financial Accounting Standards Board ("FASB") Statement No. 133." This is presented in the
Company's consolidated financial statements as the cumulative effect of a change in accounting principle.

As
a result of the foregoing, the net loss for the second quarter of fiscal 2002 was $5.7 million compared to a net income of $1.9 million for the second quarter of fiscal 2001. The net
loss for the first six months of fiscal 2002 was $10.2 million compared to a net loss of $4.0 million for the first six months of fiscal 2001.

Liquidity and Capital Resources:

Cash used in operating activities for the first six months of fiscal 2002 was $3.2 million, compared to cash provided by operations of $557,000 for the first six
months of fiscal 2001. This change was primarily attributable to a reduction in trade payable balances and insurance recoveries in the prior year period.

Working
capital was a negative $47.5 million at December 31, 2001, as compared to a negative $52.9 million at June 30, 2001. The change in working capital levels primarily
reflect a reduction in

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trade payable balances and outstanding borrowings under the Company's revolving credit facilities, partially offset by a reduction in trade receivable balances. The working capital levels also
reflect the classification of $98.2 million and $105.3 million of the Company's bank credit facility, term loan and senior notes with an insurance company as current at December 31, 2001 and
June 30, 2001, respectively. The Company has not been in compliance with certain financial covenants under the Credit Agreement, Note Purchase Agreement and the GE Financing, as defined below,
and, accordingly, such amounts have been classified as current liabilities.

During
the first six months of fiscal 2002, the Company made capital expenditures of $2.0 million, as compared to $7.2 million for the first six months of fiscal 2001. Included in the
first six months of fiscal 2001 were capital expenditures of $3.5 million to rebuild the shell molding area and boiler room damaged in the industrial accident on February 25, 1999 at Jahn
Foundry (see below). The balance of capital expenditures in both periods were used for routine projects at each of the Company's facilities.

As
discussed above, the Company has sold substantially all of the assets of Jahn Foundry and is in the process of selling substantially all of the assets of LA Die Casting. The Company
currently expects the sale of LA Die Casting will be completed during the third quarter of fiscal 2002, but there can be no assurance that this agreement will be consummated.

The
Company has four primary credit facilities: a revolving credit facility with Harris Trust and Savings Bank, as agent for several lenders (the "Credit Agreement"); senior notes (the
"Notes") with an insurance company issued under a note purchase agreement (the "Note Purchase Agreement"); a term loan with General Electric Capital Corporation (the "GE Financing"); and a receivables
program combined with a revolving credit facility with Burdale Financial Limited pursuant to a facility agreement (the "Facility Agreement"). Each of these facilities require compliance with various
covenants, including, but not limited to, financial covenants related to equity levels, cash flow requirements, fixed charge coverage ratios and ratios of debt to equity.

In
September 2001, ACUK, a subsidiary of the Company and its subsidiaries, and Burdale Financial Limited entered into the Facility Agreement. This Facility Agreement provides for
a facility of up to 25
million British pounds (approximately $35 million US), subject to certain eligibility calculations, to be used to fund working capital requirements at Sheffield, a subsidiary of ACUK, and up to $1.0
million British pounds for working capital at Autun, the Company's subsidiary in France. In addition, the Facility Agreement provides security for Sheffield's foreign currency exchange contracts and
performance bond commitments and was used to repay $5.0 million of an intercompany working capital loan ($1.1 million of which was paid to certain of the lenders as principal payments). This facility
matures on September 17, 2004 and is secured by substantially all of Sheffield's assets in the U.K. Loans under this Facility Agreement will bear interest at LIBOR plus 2.60% (6.725% at
December 31, 2001). As of December 31, 2001, ACUK had drawn $13.2 million under the Facility Agreement. The Company is currently in compliance with the covenants under the Facility Agreement.

On
December 18 2001, the Company entered into the Twelfth Amendment and Forbearance Agreement to the Credit Agreement and the Eighth Amendment and Forbearance Agreement to the
Note Purchase Agreement. These amendments, as modified, provide that, among other things, these lenders will forbear from enforcing their rights with respect to certain existing defaults through June
30, 2002.

The
Credit Agreement, as amended, currently consists of a $75.5 million revolving credit facility decreasing to $72.5 million on February 28, 2002 and to $70.5 million on
March 31, 2002. Asset sales and tax refunds are expected to be used to reduce indebtedness. In addition to the financial covenants, the Credit Agreement contains restrictions on, among other
things, acquisitions, additional indebtedness, further investments in Autun and the use of net proceeds from the sale of assets (other than inventory), insurance settlements and other non-recurring
items. Secured by substantially all of the

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Company's North American assets, loans under this revolving credit facility bear interest at fluctuating rate of the agent bank's corporate base rate plus 2.0% (6.75% at December 31, 2001).

At
December 31, 2001, Notes with an aggregate principal amount of $11.1 million were outstanding with interest accruing at 10.44% per year. The Note Purchase Agreement provides
for annual principal payments of $2.9 million, the most recent of which has not been paid. The Notes are secured by the same assets that secure the Credit Agreement and contain similar restrictions to
those described above under the Credit Agreement.

At
December 31, 2001, the balance of the term loan under the GE Financing was $28.0 million. This loan provides for monthly principal payments of $291,667 plus accrued interest.
The GE Financing is secured by certain of the Company's fixed assets, real estate, equipment, furniture and fixtures located in Atchison, Kansas and St. Joseph, Missouri, matures in
December 2004 and bears interest at a fixed rate of 9.05% per year.

The
Company has been in default under the Credit Agreement, Note Purchase Agreement and the GE Financing. To date, General Electric Capital Corporation has not enforced its rights with
respect to certain events of default under the GE Financing. To date the lenders under the Credit Agreement and the Note Purchase Agreement have foregone their rights to accelerate their debt and
foreclose on their
collateral through June 30, 2002, but there can be no assurance that they will not do so in the future if future defaults occur. During much of fiscal 2001 and to date in fiscal 2002, the
Company borrowed the full amount of the revolving credit facility under the Credit Agreement and managed its cash position accordingly. To date, the Company has been able to meet its cash needs by
traditional cash management procedures in addition to: (1) the collection of tax refunds resulting from the operating losses at the Pennsylvania Foundry Group, (2) accelerated
collections of receivables from certain longstanding customers from time to time, (3) the reduction of expenses after closing locations operating with a negative cash flow, and
(4) recently, funds available through the Facility Agreement, particularly for its operations in the U.K. and France. The Company is also seeking the recovery under various insurance policies
for losses due to the accounting irregularities at the Pennsylvania Foundry Group and the industrial accident at Jahn Foundry. In addition, the Company is pursuing other responsible parties. There can
be no assurance that such actions will be successful in recovering funds or that they will allow the Company to operate without additional borrowing capacity.

Compliance
with certain financial covenants under the Credit Agreement, Note Purchase Agreement and the GE Financing is determined on a "trailing-twelve-month" basis. The results through
December were below results needed to achieve compliance with these covenants under the Credit Agreement, Note Purchase Agreement and the GE Financing. Accordingly, the Company is currently
negotiating with new and existing financial institutions to extend its current arrangements while it attempts to establish a new credit facility with covenants that the Company believes it will be
able to satisfy and additional borrowing capacity. During the past several years, the Company has been able to negotiate operating flexibility with its lenders, although future success in achieving
any such renegotiations or refinancings, or the specific terms thereof, including interest rates, capital expenditure limits or borrowing capacity, cannot be assured. The Company believes that its
operating cash flow and amounts available for borrowing under its existing credit facility and the Facility Agreement will be adequate to fund its capital expenditure and working capital requirements
through June 2002. However, the level of capital expenditure and working capital requirements may be greater than currently anticipated as a result of unforeseen expenditures such as compliance
with environmental laws, the accident at Jahn Foundry, the investigation and related litigation in connection with the accounting irregularities at the Pennsylvania Foundry Group and substantially
higher fuel costs that arose during the third quarter of fiscal 2001, which could recur. If the Company fails to achieve compliance with the terms of its Credit Agreement or, in the absence of such
compliance, if the Company fails to amend such financial covenants on terms favorable to the Company, the Company will continue to be in default under such covenants. Accordingly, the lenders could
accelerate the debt under the Credit

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Agreement which, in turn, would permit acceleration of the Notes under the Note Purchase Agreement and the indebtedness under the GE Financing. If the lenders accelerate their indebtedness, there can
be no assurance that the Company would be able to locate alternative sources of financing.

Total
indebtedness of the Company at December 31, 2001 was $128.4 million, as compared to $121.5 million at June 30, 2001. This increase primarily reflects borrowings of
$13.2 million under the Facility Agreement. At December 31, 2001 the Company had fully utilized its revolving credit facility under the Credit Agreement and there was approximately $3.4 million
available for borrowing under the Facility Agreement.

An
accident, involving an explosion and fire, occurred on February 25, 1999, at Jahn Foundry, located in Springfield, Massachusetts. Nine employees were seriously injured and
there were three fatalities. The damage was confined to the shell molding area and boiler room. The other areas of the foundry remained operational. Molds were being produced at other foundries, as
well as Jahn Foundry, while repairs were made. The new shell molding department became operational in November 2000.

The
Company carries insurance for property and casualty damages (over $475 million of coverage), business interruption (approximately $115 million of coverage), general liability ($51
million of coverage) and workers' compensation (up to full statutory liability) for itself and its subsidiaries. The Company recorded charges of $750,000 during the third quarter of fiscal 1999,
primarily reflecting the deductibles under the Company's various insurance policies. At this time there can be no assurance that the Company's ultimate costs and expenses resulting from the accident
will not exceed available insurance coverage by an amount which could be material to its financial condition or results of operations and cash flows.

In
November 2000, the Company and its insurance carrier settled the Jahn Foundry property portion of the Company's claim. The settlement provided, among other things, for
(i) additional payments from the carrier in the amount of $2.6 million, (ii) that of the payments received to date, totaling $26.8 million, the insurance carrier will allocate no more
than $9.5 million for property damage, (iii) that the remaining proceeds of $17.3 million will be allocated to business interruption losses and will not be subject to recovery by the insurance
carrier and (iv) that the Company shall not be entitled to any additional payments unless it is determined by reference, appraisal, arbitration, litigation or otherwise that the Company's
business interruption losses exceed $17.3 million. The Company disagrees with the insurance carrier regarding the duration and amount of the business interruption losses. The Company plans to seek
additional insurance payments through arbitration expected to occur during the latter part of calendar 2002. There can be no assurance that the Company will ultimately receive any additional insurance
payments or that the excess of the Company's costs and expenses resulting from the accident over the insurance payments received will not be material to its financial condition or results of
operations and cash flows.

A
civil action has been commenced in Massachusetts Superior State Court on behalf of the estates of deceased workers, their families, injured workers and their families, against the
supplier of a chemical compound used in Jahn Foundry's manufacturing process. The supplier of the chemical compound, Borden Chemical, Inc., filed a Third Party Complaint against Jahn Foundry in
Massachusetts Superior State Court on February 2, 2000 seeking indemnity for any liability it has to the plaintiffs in the civil action. The Company's comprehensive general liability insurance
carrier has retained counsel on behalf of Jahn Foundry, and the Company and is aggressively defending Jahn Foundry in the Third Party Complaint. It is too early to assess the potential liability to
Jahn Foundry for the Third Party Complaint, which in any event Jahn Foundry will aggressively defend. In addition, Jahn Foundry has brought a Third Party Counterclaim against Borden and the
independent sales representative of the chemical compound, J.R. Oldhan Company, seeking compensation for losses sustained in the explosion, including amounts covered by insurance.

20

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On
February 26, 2001, Borden filed a Third Party Complaint against the Company seeking contribution, under Massachusetts law, from the Company in the event that the plaintiffs
prevail against Borden. The Third Party Complaint alleges that the Company undertook a duty to oversee industrial hygiene, safety and maintenance at Jahn Foundry and that the Company designed,
installed and maintained equipment and machinery at Jahn Foundry, and that the Company's carelessness, negligence or gross negligence caused the explosion and resulting injuries. It is too early to
assess the potential liability for such a claim, which in any event the Company will aggressively defend.

On
March 30, 2001, the plaintiffs amended their complaint by adding the Company as a defendant. The plaintiffs allege that the Company undertook a duty to oversee industrial
hygiene, safety and maintenance at Jahn Foundry and that the Company's carelessness, negligence or gross negligence caused the explosion and resulting injuries. The plaintiffs seek an unspecified
amount of damages and punitive damages. It is too early to assess the potential liability to the Company for such claims, which in any event the Company will aggressively defend. The Company has filed
a cross-claim for contribution against Borden and J.R. Oldhan Company.

On
December 20, 2001, the Company completed the sale of substantially all of the assets of Jahn Foundry, as described above. However, the Company did not sell its right to any
proceeds from any insurance settlement, arbitration, litigation or any proceeding relating to the industrial accident discussed above, nor did the buyer assume any such liabilities.

The
Company, its chief executive officer, and its chief financial officer were named as defendants in five lawsuits filed following the Company's announcements concerning the discovery
of accounting irregularities at the Pennsylvania Foundry Group. The cases have been consolidated before the U.S. District Court for the District of Kansas. An amended complaint filed after the
consolidation alleges, among other things, that the defendants intentionally or recklessly issued materially false and misleading financial statements in violation of Section 10(b) of the
Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. That complaint seeks certification of a class of purchasers of the Company's common stock between December 10, 1997
and November 3, 2000 and asks for damages for the class in an unspecified amount. An agreement in principle has been reached to settle the case. The settlement, which is subject to the execution of
definitive settlement documents and Court approval, calls for the establishment of a settlement fund consisting of $1.8 million, which will be paid by the Company's insurance carrier. All claims will
be dismissed without any admission of liability or wrongdoing.

The
Company understands that on or about November 29, 2000 the Securities and Exchange Commission issued a formal order of investigation as a result of the events underlying the
Company's earlier disclosure of certain accounting irregularities. The Company is cooperating with the investigation.

The
Company contractually assumed certain contingent liabilities when it purchased Autun. This contingency includes (i) the cost of employee severance payments and (ii) the
cost of environmental cleanup/restoration, if any, in the event that the foundry was to be closed. The Company currently
plans to continue operating Autun. However, Autun must fund its working capital needs internally, as the Credit Agreement, Note Purchase Agreement and the Facility Agreement prohibit the Company from
transferring funds to Autun to cover operating losses. If Autun were unable to fund its own operations, there is a risk that it would have to cease operations, and may become subject to the above
liabilities. The Company estimates that the liability could total up to $20 million over a period of time.

Forward-Looking Statements

The section entitled "Liquidity and Capital Resources" contains forward-looking statements that involve a number of risks and uncertainties. Forward-looking
statements such as "expects," "intends," "contemplating" and statements regarding quarterly fluctuations, statements regarding the adequacy of

21

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funding for capital expenditure and working capital requirements for the next twelve months and similar expressions that are not historical are forward-looking statements that involve risks and
uncertainties. Such statements include the Company's expectations as to future performance. Among the factors that could cause actual results to differ materially from such forward-looking statements
are the following: costs of closing foundries, success in selling LA Die Casting, business conditions and the state of the general economy, particularly the capital goods industry, the strength of the
U.S. dollar, British pound sterling and the Euro, interest rates, the Company's ability to renegotiate or refinance its lending arrangements, utility rates, the availability of labor, the successful
conclusion of union contract negotiations, the results of any litigation arising out of the accident at Jahn Foundry, results of any litigation or regulatory proceedings arising from the accounting
irregularities at the Pennsylvania Foundry Group, the competitive environment in the casting industry and changes in laws and regulations that govern the Company's business, particularly environmental
regulations.

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ITEM 3.

DISCLOSURES ABOUT MARKET RISK

Quantitative and qualitative information about market risk was addressed in Item 7A of the Company's Form 10-K for the fiscal year ended
June 30, 2001.

The
Company's primary interest rate exposures relate to its cash and short-term investments, fixed and variable rate debt and interest rate swaps, which are mainly exposed to
changes in short-term interest rates (e.g. USD LIBOR). The potential loss in fair values is based on an immediate change in the net present values of the Company's interest
rate-sensitive exposures resulting from a 10% change in interest rates. The potential loss in cash flows and earnings is based on the change in the net interest income/expense over a
one-year period due to an immediate 10% change in rates. A hypothetical 10% change in interest rates would have an impact on the Company's earnings before income tax of approximately
$530,000 and $380,000 in the first six months of fiscal 2001 and fiscal 2002, respectively.

The
Company's exposure to fluctuations in currency rates against the British pound and Canadian dollar result from the Company's holdings in cash and short-term investments
and its historical utilization of foreign currency forward exchange contracts to hedge customer receivables and firm commitments. The potential loss in fair values is based on an immediate change in
the U.S. dollar equivalent balances of the Company's currency exposures due to a 10% shift in exchange rates versus the British pound and Canadian dollar. The potential loss in cash flows and earnings
is based on the change in cash flow and earnings over a one-year period resulting from an immediate 10% change in currency exchange rates versus the British pound, Euro and Canadian
dollar. Based on the Company's holdings of financial instruments at December 31, 2000 and December 31, 2001, a hypothetical 10% depreciation in the British pound, Euro and the Canadian
dollar versus all other currencies would have an impact on the Company's earnings before income tax of approximately $2.9 million and $40,000 in the six three months of fiscal 2001 and fiscal
2002, respectively.

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PART II

ITEM 1Legal Proceedings

An accident, involving an explosion and fire, occurred on February 25, 1999, at Jahn Foundry, located in Springfield, Massachusetts. Nine employees were
seriously injured and there were three fatalities. The damage was confined to the shell molding area and boiler room. The other areas of the foundry remained operational. Molds were being produced at
other foundries, as well as Jahn Foundry, while repairs were made. The new shell molding department became operational in November 2000.

The
Company carries insurance for property and casualty damages (over $475 million of coverage), business interruption (approximately $115 million of coverage), general
liability ($51 million of coverage) and workers' compensation (up to full statutory liability) for itself and its subsidiaries. The Company recorded charges of $750,000 during the third quarter
of fiscal 1999, primarily reflecting the deductibles under the Company's various insurance policies. At this time there can be no assurance that the Company's ultimate costs and expenses resulting
from the accident will not exceed available insurance coverage by an amount which could be material to its financial condition or results of operations and cash flows.

In
November 2000, the Company and its insurance carrier settled the Jahn Foundry property portion of the Company's claim. The settlement provided, among other things, for
(i) additional payments from the carrier in the amount of $2.6 million, (ii) that of the payments received to date, totaling $26.8 million, the insurance carrier will
allocate no more than $9.5 million for property damage, (iii) that the remaining proceeds of $17.3 million will be allocated to business interruption losses and will not be
subject to recovery by the insurance carrier and (iv) that the Company shall not be entitled to any additional payments unless it is determined by reference, appraisal, arbitration, litigation
or otherwise that the Company's business interruption losses exceed $17.3 million. The Company disagrees with the insurance carrier regarding the duration and amount of the business
interruption losses. The Company plans to seek additional insurance payments through arbitration. There can be no assurance that the Company will ultimately receive any additional insurance payments
or that the excess of the Company's costs and expenses resulting from the accident over the insurance payments received will not be material to its financial condition or results of operations and
cash flows.

A
civil action has been commenced in Massachusetts Superior State Court on behalf of the estates of deceased workers, their families, injured workers and their families, against the
supplier of a chemical compound used in Jahn Foundry's manufacturing process. The supplier of the chemical compound, Borden Chemical, Inc., filed a Third Party Complaint against Jahn Foundry in
Massachusetts Superior State Court on February 2, 2000 seeking indemnity for any liability it has to the plaintiffs in the civil action. The Company's comprehensive general liability insurance
carrier has retained counsel on behalf of Jahn Foundry, and the Company and is aggressively defending Jahn Foundry in the Third Party Complaint. It is too early to assess the potential liability to
Jahn Foundry for the Third Party Complaint, which in any event Jahn Foundry will aggressively defend. In addition, Jahn Foundry has brought a Third Party Counterclaim against Borden and the
independent sales representative of the chemical compound, J.R. Oldhan Company, seeking compensation for losses sustained in the explosion, including amounts covered by insurance.

On
February 26, 2001, Borden filed a Third Party Complaint against the Company seeking contribution, under Massachusetts law, from the Company in the event that the plaintiffs
prevail against Borden. The Third Party Complaint alleges that the Company undertook a duty to oversee industrial hygiene, safety and maintenance at Jahn Foundry and that the Company designed,
installed and maintained equipment and machinery at Jahn Foundry, and that the Company's carelessness, negligence or gross negligence caused the explosion and resulting injuries. It is too early to
assess the potential liability for such a claim, which in any event the Company will aggressively defend.

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On
March 30, 2001, the plaintiffs amended their complaint by adding the Company as a defendant. The plaintiffs allege that the Company undertook a duty to oversee industrial
hygiene, safety and maintenance at Jahn Foundry and that the Company's carelessness, negligence or gross negligence caused the explosion and resulting injuries. The plaintiffs seek an unspecified
amount of damages and punitive damages. It is too early to assess the potential liability to the Company for such claims, which in any event the Company will aggressively defend. The Company has filed
a cross-claim for contribution against Borden and J.R. Oldhan Company.

On
December 20, 2001, the Company completed the sale of substantially all of the assets of Jahn Foundry (Note 7). However, the Company did not sell its right to any
proceeds from any insurance settlement, arbitration, litigation or any proceeding relating to the industrial accident discussed above, nor did the buyer assume any such related liabilities.

The
Company, its chief executive officer, and its chief financial officer were named as defendants in five lawsuits filed following the Company's announcements concerning the discovery
of accounting irregularities at the Pennsylvania Foundry Group. The cases have been consolidated before the U.S. District Court for the District of Kansas. An amended complaint filed after the
consolidation alleges, among other things, that the defendants intentionally or recklessly issued materially false and misleading financial statements in violation of Section 10(b) of the
Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. That complaint seeks certification of a class of purchasers of the
Company's common stock between December 10, 1997 and November 3, 2000 and asks for damages for the class in an unspecified amount. An agreement in principle has been reached to settle
the case. The settlement, which is subject to the execution of definitive settlement documents and Court approval, calls for the establishment of a settlement fund consisting of $1.8 million,
which will be paid by the Company's insurance carrier. All claims will be dismissed without any admission of liability or wrongdoing.

The
Company understands that on or about November 29, 2000 the Securities and Exchange Commission issued a formal order of investigation as a result of the events underlying the
Company's earlier disclosure of certain accounting irregularities. The Company is cooperating with the investigation.

In
addition to these matters, from time to time, the Company is the subject of legal proceedings, including employee matters, commercial matters, environmental matters and similar
claims. There are no other material claims pending. The Company maintains comprehensive general liability insurance, which it believes to be adequate for the continued operation of its business.

|ITEM 2 |  | Changes in Securities and Use of Proceeds                                                                                                                                                                                                                                                                                                                            
|------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|        |  | Unregistered Securities Transactions                                                                                                                                                                                                                                                                                                                                 
|        |  | NOT APPLICABLE                                                                                                                                                                                                                                                                                                                                                       
|ITEM 3 |  | Defaults Upon Senior Securities                                                                                                                                                                                                                                                                                                                                      
|        |  | See Liquidity and Capital Resources above.                                                                                                                                                                                                                                                                                                                           
|ITEM 4 |  | Submission of Matters to a Vote of Security Holders                                                                                                                                                                                                                                                                                                                  
|        |  | The Annual Meeting of Stockholders was held on December 6, 2001                                                                                                                                                                                                                                                                                                      
|        |  | Stockholders owning 7,376,987 shares voted in favor of David L. Belluck as a Class II director. There were 97,101 shares voted against and 248,943 shares not voted. Accordingly, Mr. Belluck was elected as a Class II director for a term
of three years. Previously elected and continuing to serve their terms are Hugh H. Aiken, Ray H. Witt and Stuart Z. Uram.

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|ITEM 5 |  | Other Information                                                 
|------- |  | ------------------------------------------------------------------
|        |  | NOT APPLICABLE                                                    
|ITEM 6 |  | Exhibits and Reports of Form 8-K                                  
|        |  | (A)                                                               
|        |  | (B)                                                               
|        |  | The Company filed a Form 8-K dated October 3, 2001. Items Reported
|        |  |                                                                   
|        |  |                                                                   
|        |  |                                                                   

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| |  | Press Release dated October 3, 2001. 
| |  | -------------------------------------
| |  |                                      
| |  |                                      
| |  |                                      
| |  |                                      
| |  |                                      
| |  |                                      
| |  |                                      
| |  |                                      
| |  |                                      
| |  |                                      
| |  |                                      
| |  |                                      
| |  |                                      
| |  |                                      
| |  | Press Release dated November 8, 2001.
| |  |                                      
| |  |                                      
| |  |                                      
| |  |                                      
| |  |                                      
| |  |                                      

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| |  |                                        |  | Item 5. |  | Other Events                                                                                                                                                                                                                                              
| |  | -------------------------------------- |  | ------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  |                                        |  |         |  | Atchison Casting Corporation announced the extension of the date on which the lenders under its Credit Agreement and Note Purchase Agreement will forbear from enforcing their rights with respect to certain existing defaults through December 14,
2001.
| |  |                                        |  | Item 7. |  | Financial Statements and Exhibits.                                                                                                                                                                                                                        
| |  |                                        |  |         |  | Letter agreement dated November 30, 2001 modifying the Eleventh Amendment to the Credit Agreement.                                                                                                                                                        
| |  |                                        |  |         |  | The Company filed a Form 8-K dated December 21, 2001. Items Reported                                                                                                                                                                                      
| |  |                                        |  | Item 5. |  | Other Events                                                                                                                                                                                                                                              
| |  |                                        |  |         |  | Atchison Casting Corporation announced the extension of its Credit Agreement through June 30, 2002.                                                                                                                                                       
| |  |                                        |  | Item 7. |  | Financial Statements and Exhibits.                                                                                                                                                                                                                        
| |  |                                        |  |         |  | Twelfth Amendment and Forbearance Agreement dated as of December 18, 2001 among the Company, the Banks party thereto, and Harris Trust and Savings Bank, as Agent.                                                                                        
| |  |                                        |  |         |  | Cash Collateral Use Agreement dated as of December 18, 2001 among the Company, as the borrower, its domestic subsidiaries, as guarantors, the Lenders party thereto, and Harris Trust and Savings Bank, as Bank.                                          
| |  |                                        |  |         |  | The Company filed a Form 8-K dated December 20, 2001. Items Reported                                                                                                                                                                                      
| |  |                                        |  | Item 5. |  | Other Events                                                                                                                                                                                                                                              
| |  |                                        |  |         |  | Press Release announcing the sale of substantially all the assets of its subsidiary, Jahn Foundry Corp.                                                                                                                                                   
| |  |                                        |  | Item 7. |  | Financial Statements and Exhibits.                                                                                                                                                                                                                        
| |  | Press Release dated December 20, 2001.

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SIGNATURES

Pursuant to the requirements 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.

|                        |  | Atchison Casting Corporation(Registrant)                                                                
|----------------------- |  | --------------------------------------------------------------------------------------------------------
|DATE: February 13, 2002 |  | /s/ Hugh H. AikenHugh H. Aiken, Chairman of the
Board, President and Chief
Executive Officer            
|DATE: February 13, 2002 |  | /s/ Kevin T. McDermedKevin T. McDermed, Vice
President, Chief Financial Officer,
Treasurer and Secretary

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