U.S. SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549
                                  Form 10-K

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

For the fiscal year ended July 31, 1999

                                 OR

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

For the Transition Period from __________ to __________

Commission File No. 0-23242

                         WEBCO INDUSTRIES, INC.
         (Exact name of registrant as specified in its charter)

          Oklahoma                                       73-1097133
(State or other jurisdiction            (I.R.S. Employer Identification Number)
of incorporation or organization)

9101 West 21st Street, Sand Springs, Oklahoma                     74063
(Address of principal executive offices)                   (Zip Code)

Registrant's telephone number, including area code - (918) 241-1000
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:  None
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:

                                                  Name of Each Exchange
    Title of Each Class                            on Which Registered
Common Stock, par value $.01                                  AMEX

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

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K (229.405 of this chapter) is not contained herein, and will
not be contained, to the best of registrant's knowledge, in definitive proxy
or information statements incorporated by reference in Part III of this Form
10-K or any amendment to this Form 10-K.  [ X ]

As of September 15, 1999, the aggregate market value of the voting stock held
by nonaffiliates of the registrant was $10,271,000.

On September 15, 1999, the number of shares outstanding of the registrant's
common stock, $.01 par value, was 7,073,723 shares.

DOCUMENTS INCORPORATED BY REFERENCE:  Part III, Items 10 through 13.
Portions of the Company's definitive Proxy Statement in connection with its
Annual Meeting.
<PAGE>



                     WEBCO INDUSTRIES, INC. AND SUBSIDIARY

                              TABLE OF CONTENTS

                                                                     Page

                                    PART I

Item 1.     Business                                                   3
Item 2.     Properties                                                14
Item 3.     Legal Proceedings                                         15
Item 4.     Submission of Matters to a Vote of Security
              Holders                                                 15


                                    PART II

Item 5.     Market for Registrant's Common Stock and Related
              Stockholder Matters                                     16
Item 6.     Selected Financial Data                                   16
Item 7.     Management's Discussion and Analysis of Financial
              Condition and Results of Operations                     18
Item 8.     Financial Statements and Supplementary Data               24
Item 9.     Changes in and Disagreements with Accountants on
              Accounting and Financial Disclosure                     44


                                    PART III

Item 10.    Directors and Executive Officers of the Registrant        44
Item 11.    Executive Compensation                                    44
Item 12.    Security Ownership of Certain Beneficial Owners
              and Management                                          44
Item 13.    Certain Relationships and Related Transactions            44


                                    PART IV

Item 14.    Exhibits, Financial Statement Schedules and
              Reports on Form 8-K                                     45

<PAGE>
                     WEBCO INDUSTRIES, INC. AND SUBSIDIARY
                                  FORM 10-K


                                    PART I

ITEM 1.     BUSINESS

General
     Webco Industries, Inc. is a specialty manufacturer of high-quality carbon
and stainless steel tubing products designed to industry and customer
specifications.  Webco's tubing products consist primarily of: welded heat
exchanger and boiler tubing, specialty stainless tube and pipe, and advanced
carbon mechanical tubing for use in consumer durable and capital goods.
Management believes that Webco is the domestic market leader in the
manufacture of welded carbon heat exchanger and boiler tubing, and the leading
supplier of stainless tubing for certain niche applications. The Company's
subsidiary, Phillips & Johnston, Inc. ("P&J"), represents several manufacturers
in the sale of various non-competing mechanical and specialty tubular products
made from copper, brass, aluminum, and stainless and carbon steel, among
others.  This representation allows the Company to better serve its customers
by offering a full range of tubing products. The Company's QuikWater division
manufactures and markets a patented direct contact water heater for commercial
and industrial applications. The Company has three production facilities in
Oklahoma and Pennsylvania and five distribution facilities in Oklahoma, Texas,
Illinois and Michigan, serving more than 1,300 customers worldwide, primarily
in North America.

     Webco Industries, Inc. is an Oklahoma corporation founded in 1969 by
F. William Weber, chairman of the board and chief executive officer. In June
1998, Webco merged with P&J, in a transaction accounted for using the pooling
of interests method of accounting.  Accordingly, all historical financial
information is presented as if the two entities have always been combined.

     Unless the context otherwise requires, the information contained in this
report, and the terms "Webco" and the "Company" when used in this report,
include Webco Industries, Inc. and its subsidiary, P&J, on a combined basis.

Industry Overview
     Specialty tubing producers occupy a niche between the primary steel
producers and customers who utilize precision tubing in the manufacture of
products primarily for the capital goods and consumer durables industries.  As
contrasted with commodity pipe producers, specialty tube mills manufacture
products which are engineered and tailored for more specialized and critical
end-use applications.

     The specialty tubing industry was once dominated by the major integrated
steel producers.  Over time, these integrated producers lost their competitive
advantage and have largely withdrawn from this segment. In addition, the
industry continues to undergo consolidation, as well as rationalization of less
efficient producers.  Despite the consolidation over the past several years,
the industry continues to be highly fragmented and is currently comprised of
independent producers that occupy relatively focused market niches.
<PAGE>
     The specialty tubing industry has been affected by several trends that are
expected to continue over the next several years.  First, customers' increasing
emphasis on just-in-time inventory methods has required tube producers to
increase operating efficiencies to accommodate more frequent, but smaller sized
orders, and has caused tube producers to place greater emphasis on inventory
management and control.  Second, customers' desires to cut operating costs
through the outsourcing of specific processing functions, such as specialty
tube manufacturing, have created the opportunity for third-party tube
producers to replace production from captive mills.  Finally, the technological
evolution of thin-slab casting, higher levels of union activities among various
steel producers, and the impacts of foreign steel producers on the U.S. markets
have caused volatility in the cost of sheet coil, the principal raw material
used in the manufacture of tubing products.

MANUFACTURING TUBING PROCESSES

Manufactured Products

     Electric Resistance Carbon Steel Weld Process:  The Company maintains
inventories of steel sheet coils from which it manufactures tubing using
electric resistance welding.  This steel is in the form of a continuous sheet,
typically 48 to 60 inches wide, between .049 and .500 inches thick, and rolled
into 15 to 20 ton coils.

     All customer orders for manufactured products are entered into a
computerized order entry system, and the appropriate steel coil inventory is
then selected and scheduled for processing in accordance with the customer's
delivery date and product specifications.  The Company attempts to maximize
efficiency by combining orders to optimize size rollings.

     The manufacturing cycle begins with the slitting of wide coils into narrow
bands.  The outside diameter of the tube to be produced determines the width of
the slit band. Steel coils over .180 inches thick used at the Sand Springs
facility are slit to pre-designated widths by outside vendors.  Steel coils
less than .180 inches thick in Sand Springs and substantially all coils in Oil
City are slit in each facility using Company equipment.

     Conversion from slit band to carbon and alloy tubes is accomplished by (i)
continuously roll forming into the desired tubular diameter; (ii) continuously
welding the edges; and (iii) cutting to approximate finished length or
multiples thereof.  After the tube has been welded and depending upon product
specifications, it may be moved to three further processing stations for
annealing (heat treatment through an atmospherically controlled roller hearth
furnace), straightening through rotary straighteners, and finishing (i.e.,
cut-to-length, non-destructive test, stencil, oil coat and package).  The
Company has stringent quality control standards in place at each stage of the
manufacturing process.

     This process produces welded heat exchanger tubing, boiler tubing,
mechanical tubing and hollows (the raw material for the cold drawing process,
which does not go through the finishing process).  Hollows are primarily for
specific cold draw orders, however, smaller amounts are produced for inventory.
<PAGE>
     In fiscal 1995 the Company placed into service a highly automated, high
frequency welded carbon tube mill ("Mill 3") at the Sand Springs, Oklahoma
facility. In North America, the Company is aware of only one similar mill
operating in the United States and one duplicate installed in Toronto, Canada.
Prior to the third quarter of fiscal 1997, the Company was not able to fully
utilize the manufacturing capabilities of Mill 3 because certain cut-off
equipment would not perform to vendor specifications. A new cut-off machine was
installed on Mill 3 during the third quarter of fiscal 1997 to replace the
original cut-off equipment.  The correction of this cut-off problem now
provides the Company the ability to manufacture tubes with diameters and wall
thickness more consistent with original expectations, thereby creating the
opportunity for the Company to further penetrate the mechanical tube markets,
as discussed below.

     Carbon Steel Cold Drawing Process:  The Company maintains inventories of
tubing hollows, which is raw material for the cold drawing process.  Most of
this tubing is manufactured by the Company's own weld tube mills. The Company
currently offers precision, made-to-order cold drawn products from .250 inch
to .375 inch in wall thickness for mechanical tubing and a limited amount of
heat exchanger and boiler tubing.  Cold drawing permits greater flexibility and
precision (as compared to the weld process) in meeting customer specifications
of tube diameters, wall thickness and other characteristics.

     Cold drawing orders are entered into a computerized order entry system.
Raw materials are selected to optimize yields and efficiency and meet the
customer's specifications and required delivery schedule.  After the proper
material has been selected for each specific order, it is cut to the desired
length.  The tube is then (i) pickled and lubricated through a series of tanks,
(ii) pointed to taper the tube end, and (iii) cold drawn (cold reduction of
outside diameter and inside diameter and elongation of tube).  After the cold
drawn tube has been manufactured to finished size, it is moved to three further
processing stations for annealing, straightening and finishing.

     Welded Stainless Tube Processing:  The manufacturing cycle for the
stainless steel weld mill operations begins with the receipt by the Company of
stainless steel coils slit to a pre-designated width by the vendor.

     Customer orders are entered into the computerized order entry system.
Slit coils are selected and fed into the stainless weld mills to be formed into
a tubular shape and welded by an automated gas welding process.  After welding,
the tube is annealed, cooled, straightened, stenciled, non-destructively
tested, cut to length and packaged for shipment.  For some special customer
requirements, the tubing is coiled to various lengths.  All of this processing
is performed in a continuous operation.

     Stainless processing provides air-cooled heat exchanger tubing,
instrumentation tubing and small diameter stainless pipe.  The majority of
stainless products are also made-to-order.

Other Tubing Products
     The Company either outsources the fabrication of its Other Tubing Products
or performs value added processing, such as cutting to length and end finishing
the product, using owned equipment. Highly specialized and technical
applications are generally outsourced.  Other Tubing Products consist of
tubular goods made of stainless steel, carbon steel, copper, brass, aluminum,
and surgical steel purchased from other manufacturers.
<PAGE>
QuikWater
     At the QuikWater facility in Sand Springs, Oklahoma, the Company purchases
the fabricated water tower and combustion chamber from an outside vendor, which
has been built to the Company's specifications.  It then assembles the unit by
adding all of the required components, based upon the specific size and model
of the unit.  Once completed, the unit is fully tested and then shipped to the
customer's site where it is installed by the Company.

Tubing Facilities
     The Company has three manufacturing facilities for producing carbon or
stainless steel tubing products.  The largest facility is located in Sand
Springs, Oklahoma, which produces a wide range of carbon steel tubing products.
This facility has been in operation since the Company began in 1969.  The
Company also has a facility in Oil City, Pennsylvania, which produces primarily
boiler and as-welded mechanical carbon steel tubing products.  The third
facility in Mannford, Oklahoma, produces stainless steel tubing products.

<TABLE>
The following table sets forth the processing and other techniques
performed at Webco's facilities:
<CAPTION>
                        Manufacturing                        Distribution
                  ------------------------   --------------------------------------------
                   Sand     Oil               Sand                         Grand    Glen
                  Springs, City, Mannford,   Springs, Nederland, Lyndon,  Rapids,  Ellyn,
                   Okla.   Penn.   Okla.      Okla.      Tx.      Ill.     Mich.    Ill.
                   -----   -----   -----      -----      ---      ----     -----    ----
<S>                   <C>     <C>     <C>        <C>      <C>       <C>       <C>     <C>
Cold Drawing          X       X
Slitting              X       X
Welding               X       X       X
Annealing             X       X       X          X        X
Straightening         X       X       X
Cut-to-Length         X       X       X          X        X         X         X       X
Integral Finning                                 X
Electronic Non-
 Destructive Testing:
 Eddy Current         X       X       X
 Flux Leakage         X
 Ultra-Sonic          X       X
Hydro Static-
 Testing              X               X          X
Stenciling            X       X       X
Bending                                          X        X                   X
Bar Coding            X       X       X          X        X
Computerized Shop-
 Floor Control        X       X       X
Metallurgical Lab &
Spectrometer          X
Statistical Process
 Control              X       X       X
</TABLE>
<PAGE>
INDUSTRY SEGMENTS
     The Company has two reportable segments: tubing products and QuickWater,
representing the Company's two strategic business units offering different
products.  The Company internally evaluates its business by facility; however,
because of the similar economic characteristics of the tubing operations,
including the nature of products, production processes and customers, those
operations have been aggregated for segment reporting purposes.  See Footnote
11 to the financial statements for additional information regarding segments.

PRODUCTS

Manufactured Tubing Products
     The Company produces tubing for a wide variety of markets and end-use
applications.  The Company seeks to identify niche markets and customers that
have been serviced by high cost and low service competitors.  The carbon heat
exchanger and boiler tube markets are examples of the Company achieving
significant penetration following this strategy. Management believes that Webco
is the domestic market leader in the manufacture of welded carbon heat
exchanger and boiler tubing, and that it is the leading supplier of stainless
steel tubing for certain niche applications.  The Company continues to target
the carbon mechanical tube market for future growth. The Company is building
its market share for mechanical tubing through its low cost structure and high
product quality, together with the Company's commitment to customer service.
A detailed description of the Company's Manufactured Tubing Products by the
four major end-use markets follows:

     Carbon Heat Exchanger Tubing: Most of the tubing the Company manufactures
for this market comes directly from the weld mill process.  The Company
believes it is currently the market leader in the manufacture of welded carbon
heat exchanger tubing in the United States.  Due to the Company's leading
market position, the Company expects growth to come from growth in the total
market.

     Heat exchangers generally fall into two broad categories; shell and tube,
and air-cooled.  Shell and tube heat exchangers are used to control
temperatures or to recover waste heat in, among other things, power stations,
petrochemical plants, and refineries.  Air-cooled heat exchangers are used to
dissipate heat generated by industrial processes in, among other things, gas
compressor stations and petrochemical plants.  The Company manufactures carbon
tubing suitable for both shell and tube and air-cooled heat exchangers.

     Carbon Boiler Tubing: The Company produces welded boiler tubing from both
the Sand Springs, Oklahoma, and Oil City, Pennsylvania, facilities.  This
capability enables the Company to cost-effectively serve this market throughout
the continental United States and eastern Canada.  Since the opening of the Oil
City facility in fiscal 1990, the Company believes it has significantly
expanded its market share.

     The Company's products are used for the manufacture and maintenance of
boiler systems for utilities, waste-heat recovery units, industrial and
commercial facilities, and co-generation plants.  While maintenance is an
ongoing requirement, new boiler manufacturing generally depends on industrial
plant expansion and construction of new energy production facilities.
<PAGE>
     Stainless Tubing: The Company serves five sub-markets within the small
diameter welded stainless tubing category: instrumentation tubing, stainless
pipe, mechanical tubing, heat exchanger tubing, and other tubing.  The end uses
for these products include appliances, industrial plant piping systems,
instruments for the petrochemical industry, and a variety of other capital
goods applications.  The Company is a small, niche producer, due to both
product size and capacity constraints.  Over the past 3 years, the Company has
nearly quadrupled its stainless capacity and plans to continue aggressive
growth in the above product lines.

     The stainless pipe and tube industry over the last three years has been
impacted by high levels of low cost foreign imports (including both raw coils
and finished tubes and pipe), which have created historically low pricing and a
highly competitive sales environment.

     Mechanical Tubing: Mechanical tubing includes both as-welded and cold
drawn tubing.  Most of the products the Company manufactures from its cold draw
processes are for mechanical tube applications.  The end-uses for these
products are very diverse and include hydraulic cylinders, automotive
components, appliances, farm equipment, and a wide variety of consumer durables
(such as bicycles and lawnmowers) and capital goods.  The Company is a
relatively small producer in this market, but continues to pursue opportunities
for growth.

     In conjunction with the increased capabilities of Mill 3, the Company has
targeted the mechanical tubing market as a growth area over the next several
years.  This market continues to undergo a major change in which final assembly
manufacturers (automotive, appliance, etc.) outsource component parts and
emphasize just-in-time inventory management to reduce production costs.  Webco
believes that this market, which is largely comprised of original equipment
manufacturers ("OEMs"), provides an opportunity for the Company to gain market
share by utilizing its technological capabilities to offer superior quality,
on-time delivery, customer service, and customized products at competitive
prices.

Other Tubing Products
     The Company sells a variety of other tubing products, primarily through
its subsidiary, P&J. Other Tubing Products consist of tubular goods made of
stainless and carbon steel, copper, brass, aluminum, and surgical steel
purchased from other manufacturers.  These products come in a wide range of
sizes and are used in a variety of applications.  In many cases, the Company
provides just-in-time inventory management for its customers.

QuikWater
     The Company's QuikWater division manufactures and sells a patented direct
contact water heater.  The water heater generates hot water on demand and has
significant energy saving benefits coupled with unique environmental
advantages.  It can be used in a variety of commercial applications such as
food processing, manufacturing, health care, construction, and other markets
where a high volume of hot water is required.

Quarterly Effects and Seasonality
     Order rates generally tend to be lower during late summer as many of the
Company's customers schedule plant shutdowns for vacations. In addition, the
Company experiences some seasonality in stainless during its third fiscal
quarter, which may result in reduced net sales and income for that period.
<PAGE>
Backlog
     The Company's firm backlog of orders at July 31, 1999 and 1998 were $25.9
million and $27.2 million, respectively.  Orders, including a portion of the
orders considered firm, are generally cancelable by the customer until work has
commenced and the Company has committed resources; thereafter, orders are
generally cancelable by the customer only upon payment of a cancellation
penalty.

Competition
     Specialty steel tube manufacturing is a highly competitive market in which
companies compete on the basis of price, quality, service and ability to
deliver orders on a timely basis.  Public data concerning the size of the
markets in which the Company participates is not available since many of the
large competitors are privately held. The Company believes that it is the
domestic market share leader in welded carbon heat exchanger tubing, welded
carbon boiler tubing, and certain stainless steel applications.  Although the
Company has a small share of the mechanical tubing market, management believes
that it is well positioned to increase its market share over the next several
years.

     The Company's major competitors include Vision Metals, Inc. for carbon
heat exchanger tubing, Plymouth Tube Company for carbon boiler tubing,
Damascus/Bishop Tube, Inc. and Gibson Tube, Inc. for stainless products, and
Copperweld Corporation, John Roberts Industries, Pittsburgh Tube Company and
Lone Star Steel Company for mechanical tubing.  Certain of these competitors
are larger and have access to greater financial resources than the Company.
Most of these competitors are unionized.

     The Company believes that its non-union status, geographic balance,
focused niche strategy, product quality, customer service and continued
emphasis on technical innovations position it to compete effectively within
each of its niche markets.

Quality Control
     The supply of quality products and service is critical to the Company's
success.  To help foster continuous improvements in quality and service, the
Company, through its corporate quality management department, instituted a
total quality management system based upon ISO 9000 quality system standards.
In early 1994, the Company achieved ISO 9002 certification at its Sand Springs,
Oklahoma, manufacturing facility.  ISO 9002 certification at its Oil City,
Pennsylvania, manufacturing facility followed in early 1995.  The Company has
obtained QS-9000 certification at its Sand Springs, Oklahoma, and Oil City,
Pennsylvania, facilities.  In support of the total quality management system,
the Company has created an environment that emphasizes and utilizes teamwork to
support continuous improvement of quality and service.

     Fundamental to the Company's quality system is the control of the product
and process, from raw material procurement to the ultimate delivery of finished
goods to the Company's customers.  On a test basis, physical and chemical
analyses are performed on raw materials to verify that their mechanical and
dimensional properties, cleanliness, and surface characteristics meet the
Company's and industry requirements.  The Company has also developed stringent
process controls, including Statistical Process Control, non-destructive
testing methods, and standardized operating and inspection procedures, to
provide assurance of quality, and to ensure that the customer's requirements
are met throughout the manufacturing process.
<PAGE>
Suppliers
     The Company purchases steel sheet coil produced by a number of primary
steel producers including, but not limited to, Wheeling-Pittsburgh Steel Corp.
and Nucor for carbon steel, and J & L Specialty Products Corporation and
Allegheny Teledyne Inc. for stainless steel.  In addition, Webco purchases from
intermediate steel processors and brokers in order to benefit from their
purchasing power or for their specialized processing capabilities.  Webco
monitors and purchases raw material periodically from foreign sources, as
conditions dictate, to obtain a competitive landed cost.  The Company orders
steel to specified physical characteristics and chemistry.  By purchasing in
large quantities at consistent predetermined intervals, Webco is able to obtain
quality raw materials at competitive prices.  All increments of the cost of
purchasing and landing steel are continuously monitored, reviewed and acted
upon.  Webco believes that it is not dependent on any one of its suppliers for
raw materials, although as demonstrated by the Wheeling-Pittsburgh labor strike
during much of fiscal year 1997, interruptions in supply from its main
suppliers may impact the landed cost of new purchases.

     Webco understands that the Company's supplier base for materials is
critical to its economic health.  Constant effort is directed towards
developing long-term partners who can provide acceptable quality, competitive
prices, dependable delivery, and are, themselves, economically stable.  Many of
Webco's suppliers have been supplying materials to the Company for 15 to 20
years.

Marketing and Customer Service
     The Company's products and services are sold predominately by the
Company's inside and outside sales personnel.

     The Company's sales and marketing efforts for its manufactured products
are directed by a vice president of sales and marketing, the President of P&J,
and Webco's product sales managers.  These efforts are supported by its
distribution organization, internal sales staff and technical services group.
The Company also emphasizes the use of its technical and engineering support
staff in its product development and marketing efforts.  The Company's
technical services, operating, engineering, quality, sales, product planning
and purchasing staffs work closely with its customers and suppliers to develop
products that meet specific customer applications.  Variables in the product
development process include the steel's microstructure, chemistry, mechanical
properties, surface finish, machinability, and product consistency.  The
Company believes this process is essential to its sales effort and provides the
Company with a competitive advantage.

     Sales of the Company's Other Tubing Products are directed by the President
of P&J, and its sales staff, headquartered in Glen Ellyn, Illinois. The
Company's Other Tubing Products line and P&J's other sales representative
accounts constitute over 50% of P&J's sales effort.

Customers and Distribution
     The Company manufactures and distributes specialty steel tubular product
for sale to a diverse group of more than 1,300 customers.  No single customer
represents in excess of 5% of the Company's net sales.  The Company's
ten largest customers represent approximately 27% of net sales.  More than 80%
of the Company's sales are directly to industrial customers, including
manufacturers of heat exchangers, high efficiency home heating furnaces,
appliances, automotive components, power generation equipment, waste heat
recovery systems, industrial and commercial boilers, and other consumer durable
goods.
<PAGE>
     While the Company ships product throughout North America, many of its
markets and customers are located within a 500-mile radius of its manufacturing
and distribution locations.  As it concerns these markets and customers, this
geographic advantage places the Company in a more cost competitive position
relative to many of its competitors.  The Company transports product for local
delivery via Company-owned or leased vehicles.  Longer distance deliveries are
generally made via independent trucking firms.

     The Company offers its finished product for shipment directly from its
three manufacturing locations.  In addition, the Company also inventories
finished goods and functions as its own distributor in some of its markets.
Such markets and customers are served on a just-in-time basis from the
Company's distribution locations in Oklahoma, Texas, Illinois and Michigan.
Finished goods inventories for distribution generally are suitable for sale to
many customers and generally are not unique to a specific customer's needs.

     The Company believes that its long-term relationships with many of its
customers are a significant factor in its business and that pricing, quality,
service and the ability to deliver orders on a timely basis are the most
critical factors in maintaining these relationships.  Company executive
officers actively participate in the Company's marketing efforts and have
developed strong business relationships with senior management of many of the
Company's principal customers.

Government Regulation
     The Company's distribution and manufacturing facilities are subject to
many federal, state, and local requirements relating to the protection of the
environment.  The Company continually examines ways to reduce emissions and
waste and reduce costs related to environmental compliance.  The Company has an
in-house environmental engineer leading the Company's environmental program.
Management's philosophy is to implement environmental controls that meet or
exceed current and foreseeable legal requirements.  Management believes the
Company is in material compliance with all environmental laws, does not
anticipate any material expenditure to meet environmental requirements, and
generally believes that its processes and products do not present any unusual
environmental concerns.  See "Item 3.  Legal Proceedings."

     The Company's operations are also governed by laws and regulations
relating to workplace safety and worker health, principally the Occupational
Safety and Health Act and regulations thereunder which, among other
requirements, establish noise and dust standards.  Management believes it is in
material compliance with these laws and regulations and does not believe that
future compliance with such laws and regulations will have a material adverse
effect on its results of operations or financial condition.

Employees
     As of August 31, 1999, the Company employed 783 people.  None of the
Company's employees are covered by collective bargaining agreements.  The
Company has never experienced a significant work stoppage and considers its
employee relations to be good.
<PAGE>
FORWARD-LOOKING STATEMENTS

     Certain statements in this Annual Report on Form 10-K, including
statements preceded by, or predicated upon the words "expects" and "believes",
constitute "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995.  Such forward-looking statements
involve known and unknown risks, uncertainties and other important factors that
could cause the actual results, performance or achievements of the Company, or
industry results, to differ materially from any future results, performance or
achievements expressed or implied herein.  Such risks, uncertainties and
factors include, among others:

General Economic and Business Conditions
     Many of the Company's products are sold to industries that experience
significant fluctuations in demand based on economic conditions or other
matters beyond the control of the Company.  No assurance can be given that the
Company will be able to increase or maintain its level of sales in periods of
economic stagnation or downturn.

Competition from Imports
     The level of imports of tubular products affects the domestic tubular
products market, which has varied significantly over time. High levels of
imports may reduce the volume sold by domestic producers and depress selling
prices. In addition, the strength of the U.S. Dollar and volume motives of some
foreign importers may create circumstances where product pricing is at levels
that are marginally profitable or even unprofitable.   The Company believes
that import levels and import pricing are affected by, among other things,
overall worldwide demand for tubular products, global economic conditions, the
trade practices of and government subsidies to foreign producers, and the
weakness or absence of governmentally imposed trade restrictions in the United
States.  Given the uncertainty in certain economies of Asia, South America and
Eastern Europe, competition from foreign imports should be anticipated.

Changes in Manufacturing Technology
     Over the past 10 years, there have been significant advances in the
technology relating to the manufacture of carbon and stainless steel tubing.
Such advances have impacted the speed at which tubing can be manufactured, the
quality of the tubing, and the types and densities of materials that can be
welded into tubes for advanced manufacturing processes.  In many circumstances,
maintaining current manufacturing technologies is necessary to be competitive
with other domestic producers and foreign imports or to be able to provide
goods for customers' advancing manufacturing needs and processes.   Maintaining
current manufacturing technologies and capabilities requires investment of
capital.  Manufacturers that do not maintain current technologies may be
rationalized by the industry as a result of their inability to compete against
more efficiently priced products.

Industry Capacity
     The Company and many of its competitors in both the stainless and carbon
steel tubing markets have expanded production capacity over the past decade and
continue to do so in connection with the growth in product demand and benefits
related to current manufacturing technology.  Continued significant expansion
could result in industry over-capacity.  Over capacity could also result from a
sudden decrease in demand or a significant increase in foreign imported supply.
<PAGE>
Domestic Competition
     Specialty steel tube manufacturing is a highly competitive market in which
companies compete on the basis of price, quality, service and ability to fill
orders on a timely basis.  The Company has different competitors within each of
its markets served.  Certain of these competitors are larger and have greater
financial resources than the Company.  Sales of some of the Company's products
represent a high percentage of the market demand for these products, and could
be targeted by competitors.

Raw Material Costs and Availability
     The Company's largest component of cost of sales is raw material costs.
These costs can vary over time due to changes in steel pricing which are
influenced by numerous factors beyond the control of the Company, including
general economic conditions, foreign imports, domestic competition, labor
costs, import duties and other trade restrictions.  Typically, the Company
passes on these changes in cost to customers. However, reductions in the
Company's raw material costs may lag behind pressure on the Company's sales
prices or increases in raw material costs may precede increases in the
Company's sales prices, thus affecting the Company's profit margins.

Loss of Significant Customers and Customer and Vendor Work Stoppages
     The Company sells its tubular products to a diverse group of more than
1,300 customers.  Although no single customer represents in excess of 5% of the
Company's 1999 net sales, and no one end-use sector represents more than 25% of
1999 net sales, the loss of any significant customer, or a work stoppage at a
significant customer or in an important end-use sector, such as automotive,
could have an adverse effect on the Company's operating results.

Successful Implementation of Enterprise Software
     The Company is currently installing an enterprise resource planning
("ERP") software system designed to modernize its information technology needs,
improve management data, and solve any issues the Company may have that are
associated with the Year 2000 ("Y2K").  The Company's inability to successfully
complete the implementation of the ERP system would require the Company to
pursue other information technology solutions, delay compliance with Y2K, and
force the Company to potentially manually verify its business transactions for
some period of time.  See Item 7., Management's Discussion and Analysis of
Financial Condition and Results of Operations for further discussion of the ERP
system and Y2K project.

Y2K Compliance by Customers and Vendors
     Failure by the Company's customers and vendors to find adequate solutions
to any Y2K issues they may have could result in customers having a significant
interruption in their buying patterns and volumes, and vendors being unable to
deliver product required for the Company's manufacturing processes in a timely
manner.
<PAGE>
ITEM 2.     PROPERTIES

     The Company's principal properties presently consist of three
manufacturing plants and five distribution facilities.  The following sets
forth the location, area, and whether the property is owned or leased for each
existing facility:

  Location                          Area                    Owned or Leased
  --------                          ----                    ---------------
Sand Springs, Oklahoma      281,000 square feet                 Owned
Manufacturing Facility           26 acres

Sand Springs, Oklahoma       50,000 square feet                 Owned
Distribution Facility            18 acres

Sand Springs, Oklahoma       19,850 square feet                 Owned
QuickWater Facility               4 acres

Mannford, Oklahoma          138,000 square feet                 Owned
Manufacturing Facility           13 acres

Nederland, Texas             25,200 square feet        Long-term lease with a
Distribution Facility                                  purchase Option of the
                                                          greater of 93% of
                                                           FMV or $475,000

Oil City, Pennsylvania      205,000 square feet                 Owned
Manufacturing Facility            8 acres

Tulsa, Oklahoma              24,400 square feet        Long-term lease with a
Corporate Offices                                        purchase option of
                                                               $750,000

Tulsa, Oklahoma              28,000 square feet            Long-term lease
Finning Facility

Glen Ellyn, Illinois         25,700 square feet            Long-term lease
P&J Corporate Offices
and Distribution Facility

Lyndon, Illinois             33,700 square feet            Long-term lease
Distribution Facility

Wyoming, Michigan            55,000 square feet            Long-term lease
Distribution Facility


     The Company considers all of its properties, both owned and leased,
together with the related machinery and equipment contained therein, to be well
maintained, in good operating condition, and suitable and adequate to carry on
the Company's business.
<PAGE>
ITEM 3.     LEGAL PROCEEDINGS

     In August 1997, the Company filed an action, Webco Industries, Inc. vs.
Thermatool Corporation and Alpha Industries, Inc., relating to certain cut-off
equipment sold to the Company and installed on Mill 3, which did not perform to
specifications.  The case, filed in the United States District Court for the
Northern District of Oklahoma (Case No. 97-CV-708H (W)), sought recoveries
including, but not limited to, the cost of the equipment and other incidental
and consequential damages, including lost profits, suffered by the Company.  On
May 27, 1999 a jury awarded the Company $1.1 million in its claims against
Thermatool.  On December 1, 1998, the court ruled that the Company could not
collect lost profits and certain other incidental and consequential damages,
and limited the Company's possible recovery to the purchase price of the
equipment plus the cost of improvements and interest.  The damages awarded by
the jury, accordingly, do not include lost profits by the Company.  Now that
the first trial has been decided in the Company's favor, the Company has
petitioned the court for attorneys' fees and has appealed the pre-trial order
that prevented the Company from recovering for lost profits.  There can be no
assurances that the Company will be successful on appeal or that if successful,
lost profits awarded in the succeeding trial, if any, will be commensurate with
actual lost profits suffered by the Company.  Thermatool has appealed the
jury's verdict and there can be no assurances as to what the outcome of that
appeal will be.

     The Company is also a party to various other lawsuits and claims arising
in the ordinary course of business.  Management, after review and consultation
with legal counsel, considers that any liability resulting from these matters
would not materially affect the results of operations or the financial position
of the Company.  The Company maintains liability insurance against risks
arising out of the normal course of business.

ITEM 4.     SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     There were no matters submitted to Webco security holders during the
fourth quarter of fiscal year 1999.
<PAGE>
                                    PART II

ITEM 5.     MARKET FOR REGISTRANTS COMMON STOCK
            AND RELATED STOCKHOLDER MATTERS

     Webco's common stock is traded on the American Stock Exchange ("AMEX")
under the symbol "WEB." At the close of business on September 15, 1999, there
were 289 holders of record of Webco's common stock.  The quarterly prices of
Webco's common stock were as follows:

Fiscal Year 1999:                       High             Low
                                        ----             ----
Fourth Quarter                          5 1/2            4 9/16
Third Quarter                           6 3/16           3 13/16
Second Quarter                          7 7/16           5 7/8
First Quarter                           8                5 1/2

Fiscal Year 1998:
Fourth Quarter                          10 3/16          7 1/2
Third Quarter                           9 1/2            7
Second Quarter                          7 7/8            6 1/2
First Quarter                           8 1/2            6 3/8


Dividends
     The Company currently intends to retain earnings to support its growth
strategy and does not anticipate paying dividends in the foreseeable future.
The Board of Directors may reconsider or revise this policy from time to time
based upon conditions then existing, including the Company's results of
operations, financial condition, and capital requirements, as well as other
factors the Board of Directors may deem relevant.  Under the Company's loan
agreement, the Company may not pay dividends without the lenders consent.

ITEM 6.     SELECTED FINANCIAL DATA

     The following table presents selected financial information for the
Company as of the end of and for each of the five years in the period ended
July 31, 1999, which has been derived from the audited Financial Statements
of the Company.  In fiscal year 1998, Webco merged with P&J.  Because the
merger was accounted for as a pooling of interests, financial results for the
1995 through 1998 periods are presented as though the companies have always
been combined.

     The selected financial data should be read in conjunction with the
Financial Statements of the Company and notes thereto and "Management's
Discussion and Analysis of Financial Condition and Results of Operations"
appearing elsewhere in this Form 10-K.
<PAGE>
<TABLE>
                     WEBCO INDUSTRIES, INC. AND SUBSIDIARY
                            Selected Financial Data
                          For the Years Ended July 31,
                 (Dollars in thousands, except per share data)
<CAPTION>
Income Statement Data:          1999      1998      1997      1996      1995
                               -----     -----     -----     -----     -----
<S>                         <C>       <C>       <C>       <C>       <C>
Net sales                   $134,744  $151,431  $128,593  $112,525  $108,284
Gross profit                  21,353    28,486    20,228    17,159    15,195
Income from operations         5,564    11,305     7,234(1)  7,145     6,673
Income before income
    taxes                      3,012     9,009     5,187     4,893     1,921(2)

Net income (loss) (3)          1,876     6,207     3,931     3,767     1,242

Net income (loss) per share (3):
     Basic                       .26       .87       .55       .53       .17
     Diluted                     .26       .86       .55       .53       .17

Pro forma net income (4)                 5,511     3,179     2,990       513

Pro forma net income per
    share (4):
     Basic                                 .77       .44       .42       .07
     Diluted                               .76       .44       .42       .07

Balance Sheet Data:
Working capital              $32,346   $30,861   $33,837   $22,011   $19,626
Total assets                 120,481   111,758   102,142    86,888    83,325
Long-term debt (net of
    current portion)          39,746    32,894    34,470    19,797    18,313
Stockholders' equity          49,673    48,245    45,220    42,913    40,322

<FN>
(1) Includes an $884,000 ($548,000, or $0.08 per diluted share after tax)
    charge related to the replacement and write-off of faulty equipment on the
    Company's Mill 3.
(2) Includes a $3.5 million ($2.7 million, or $0.37 per diluted share after
    tax) charge related to the settlement of securities litigation.
(3) P&J was an S-Corporation for Federal and state income tax purposes through
    June 29, 1998, and accordingly did not incur any Federal or state income
    taxes prior to that date.
(4) The 1995 through 1998 periods presented have been adjusted on a pro forma
    basis for assumed Federal and state income taxes for P&J, which had not
    previously recognized income taxes due to their S-Corporation status.  Pro
    forma income taxes were based upon the statuary (Federal & state) tax rate
    of 38 percent.
</TABLE>
<PAGE>
ITEM 7.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
            FINANCIAL CONDITION AND RESULTS OF OPERATIONS

     The following discussion should be read in conjunction with the "Selected
Financial Data" and the Financial Statements of the Company and notes thereto
appearing elsewhere in this Form 10-K.

Overview
     The Company's philosophy is to pursue growth and profitability through the
identification of niche markets that preferably involve specialty tubular
products that require a high level of value engineering and can be dominated
from an industry or customer standpoint.  The Company uses its quality
standards, customer service and manufacturing technology to achieve such market
penetration.

     During the three year period ended July 31, 1999, the Company spent $32.3
million on capital projects.  This included several major projects, such as
expansion and installation of additional mills at the stainless facility,
expansion and installation of new equipment at Oil City, expansion and
improvements at the Sand Springs facility, and expenditures towards the
purchase and installation of an enterprise software system.

Results of Operations
     The following table sets forth certain income statement data for each of
the three years in the period ended July 31, 1999 (certain amounts may not
calculate due to rounding):
<TABLE>
<CAPTION>
                             1999                  1998               1997
                        Dollar    % of        Dollar    % of     Dollar    % of
                        Amount  Net Sales     Amount  Net Sales  Amount  Net Sales
                        ------  ---------     ------  ---------  ------  ------
                                           (Dollars in Millions)
<S>                     <C>        <C>        <C>        <C>     <C>     <C>
Net sales               $134.7     100.0%     $151.4     100.0%  $128.6  100.0%
Gross profit              21.4      15.9        28.5      18.8     20.2   15.7
Selling, general and
 administrative expenses  16.5      12.2        17.9      11.8     13.0   10.1
Income from operations     5.6       4.2        11.3       7.5      7.2    5.6
</TABLE>
     The following discussions of sales levels, prices and gross profit
revolve around the Company's Manufactured Tubing Products (carbon and stainless
steel tubing from its three plants in Oklahoma and Pennsylvania), Other Tubing
Products (purchased tubular goods made of stainless steel, carbon steel,
copper, brass and surgical steel) and QuikWater.

Fiscal 1999 Compared with Fiscal 1998
     Manufactured Tubing Product sales decreased $18.8 million, or 13.6%, to
$119.2 million in 1999 from $138.0 million in 1998.  The decrease in net sales
reflects a 14.7% decrease in the tonnage of tubing sold during 1999, which was
partially offset by a 1.2% increase in the average net sales price per ton. The
overall decrease in the tonnage of tubing sold reflects a decrease in sales of
carbon tubing products, which was the result of among other things, inventory
reductions by distributors, low priced foreign imports, and low demand for
foreign exports.  The increase in the average net selling price is a
combination of a change in sales mix and improved pricing structures in certain
stainless products, which more than offset the decrease in the net sales price
per ton obtained for carbon products.
<PAGE>
     Gross profit for Manufactured Tubing Products decreased to $18.4 million,
or 15.4% of net sales, in 1999 from $25.4 million, or 18.4% of net sales, in
1998.  This decrease is a function of the decrease in the tonnage sold combined
with poor pricing in the market.  The slight overall increase in average price
per ton is a result of sales mix rather than an indication of improved pricing.

     Other Tubing Products sales are made primarily by Webco's subsidiary, P&J.
Sales of these products increased 2.5% to $12.1 million in 1999 from $11.8
million in 1998.  The increase in sales is primarily the result of volume
increases.

     Gross profit from Other Tubing Products decreased to $2.6 million, or
21.4% of net sales, in 1999 from $3.3 million, or 28.1% of net sales, in 1998.
The decrease in gross profit was the direct result of pricing pressure in the
market place, which necessitated pricing reductions in order to maintain
customers, and a change in sales mix from the prior year period.

     Sales for QuikWater increased 113.6% to $3.4 million in 1999 from $1.6
million in 1998.  The increase is the result of a concentrated sales effort and
increased recognition in the market place.

     Gross profit for QuikWater was $388,000 in 1999 as compared with a loss of
$247,000 in 1998.  The increase is a reflection of increased sales and
manufacturing fixed and semi-fixed costs being spread over higher volumes.

     Selling, general and administrative expenses decreased 7.9% to $16.5
million in fiscal 1999 from $17.9 million in fiscal 1998.  The decrease in the
current year is primarily the result of a $1.6 million decrease in profit
sharing and bonuses to employees and the $565,000 of expenses incurred in 1998
related to the merger with P&J.  The decreases are principally offset by an
increase of approximately $600,000 in depreciation of capitalized costs
related to the installation of the Enterprise Resource Planning software.

     Interest expense for fiscal 1999 increased to $2.6 million (net of
$437,000 capitalized) from $2.3 million (net of $517,000 capitalized) in fiscal
1998.  The increase in interest, prior to interest capitalization, is the
result of the average level of debt under the bank Loan and Security Agreement
being $35.4 million for 1999 as compared with $31.6 million for 1998.  This
increase was partially offset by a decrease in the average borrowing rate to
7.20% in 1999 from 7.72% in 1998.

Fiscal 1998 Compared with Fiscal 1997
     Manufactured Tubing Product sales increased $20.8 million, or 17.7%, to
$138.0 million in 1998 from $117.2 million in 1997.  The increase in net sales
reflects a 12.8% increase in the tonnage of steel tubing sold in 1998, and a
4.4% increase in the average net selling price. The volume increase in 1998
versus 1997 reflects higher utilization at all facilities due to improved
market conditions and increased market penetration of the mechanical and heat
exchanger tubing markets.  The increase in the average net selling price
resulted primarily from improved pricing structures in carbon products.

     The increase in Manufactured Tubing Products gross profit to $25.4
Million, or 18.4% of net sales, in 1998 from $17.3 million, or 14.8% of net
Sales, in 1997 is a function of the higher selling prices above, improvements
in the manufacturing cost and higher volumes which spread fixed and semi-fixed
costs.
<PAGE>
     Other Tubing Products sales are made primarily by Webco's subsidiary, P&J.
Sales of these products increased 14.7% to $11.8 million in 1998 from $10.3
million in 1997.  While there were some increases in sales prices, the increase


in sales is primarily the result of volume increases in a variety of markets
from both existing customers and the addition of new customers.

     Gross profit from Other Tubing Products increased to $3.3 million, or
28.1% of net sales, in 1998 from $2.9 million, or 28.2% of net sales, in 1997.
The increase in gross profit was the direct result of increased sales.

     Sales for QuikWater increased 47.4% to $1.6 million in 1998 from $1.1
million in 1997.  This increase is the result of greater sales efforts
resulting from an expanded sales force and a continued increase of recognition
in the market place.

     Gross profit for QuikWater was ($247,000) in 1998 as compared with $3,000
in 1997.  This decrease is primarily the result of low volumes relative to
manufacturing capacity, and pricing pressure from competing products.

     Selling, general and administrative expenses increased 38.5% to $17.9
million in fiscal 1998 from $13.0 million in fiscal 1997.  Factors contributing
to the increase include $2.4 million of employee profit sharing and bonuses in
1998 compared to $285,000 last year, $565,000 of expenses related to the merger
with P&J, $323,000 of expenses related to the installation of an enterprise
software system, and increased commissions based on higher levels of sales.

     Interest expense for fiscal 1998 increased to $2.3 million (net of
$517,000 capitalized) from $2.0 million (net of $433,000 capitalized) in fiscal
This increase is due to higher average borrowing level during 1998 which was
partially offset by a slightly lower average borrowing rate.

Liquidity and Capital Resources
     Net cash provided by (used in) operations was $8.6 million, $15.1 million
and ($2.1) million in fiscal 1999, 1998 and 1997, respectively.  Accounts
receivable decreased in 1999 primarily as a result of the decrease in sales
from 1998.  Inventories increased in 1997 and 1999, however they decreased
slightly in 1998.  The increase in inventory in 1999 was the result of the
Company's ability to take advantage of lower priced steel coils.  Accordingly,
accounts payable increased in 1999 primarily as a result of the increase in
inventory.  Over the past three years, the Company has turned its steel tube
inventories approximately 4.1 times per year on average.

     Net cash used in investing activities was $12.9 million, $11.9 million and
$10.2 million in fiscal 1999, 1998 and 1997, respectively. During 1999 the
Company added new mills at its stainless plant, continued the development and
installation of the ERP system, and expanded facilities and operations at its
Oil City plant.  During 1998, the Company completed the expansion of its Sand
Springs shipping facility, added new stainless mills at its stainless plant,
completed the renovation of the building it is leasing to house its corporate
headquarters, and initiated the acquisition, development and installation of
new financial and operational software.  In fiscal 1997, the Company expanded
its stainless plant, including the addition of new stainless mills, purchased
new cut-off equipment for Mill 3 to replace the faulty cut-off equipment, began
the expansion of its shipping facility at the Sand Springs location and began
the renovation of its corporate headquarters.
<PAGE>
     The Company's capital requirements have historically been to fund
equipment purchases and for general working capital needs resulting from the
growth that the Company experienced. The Company followed an aggressive capital
expenditure plan as part of its growth strategy and to enable it to continue to
be a leader in tubular manufacturing technologies.  The Company foresees a
continuance of this strategy in the future. The Company is currently proceeding
with the expansion of its carbon and stainless tubing manufacturing capacity.

     The Company's financing arrangements provide for a term loan of $25
million and a line of credit of $25 million.  As of July 31, 1999, the Company
had $25 million outstanding on the term loan, and $12.6 million under the
revolving line of credit. These loans mature on August 31, 2002, and are
collateralized by substantially all of the Company's assets other than the Sand
Springs and Oil City real estate.  The Company may have borrowings and
outstanding letters of credit ($1,575,000 at July 31, 1999) under the revolving
credit facility up to the lesser of $25 million or an amount determined by a
formula based on the amount of eligible inventories and accounts receivable. At
July 31, 1999, $9.7 million was available for borrowing under this line of
credit.

     The Company has arranged for a capital expenditure  ("CAPEX") facility in
the amount of $5 million to finance equipment at the Oil City, Pennsylvania,
plant.  The line matures on August 31, 2002.  At July 31, 1999, $5 million was
available for borrowing under this facility.

     The Company has approximately $1.4 million of public agency financing
related to the Oil City project outstanding as of July 31, 1999.  The agency
loans have interest rates ranging from 3 to 5.75 percent and maturities of
5 to 9 years.

     P&J has a line of credit agreement for $2,000,000 and term loans of
$250,000 and $500,000 with its primary lender. As of July 31, 1999, the Company
had $300,000 outstanding under the line of credit and $39,000 and $479,000,
respectively, outstanding on the term loans.  The line of credit matures on
November 30, 1999, and the term loans mature in January 2000 and April 2004,
respectively, and are collateralized by P&J's assets. At July 31, 1999, $1.7
million was available for borrowing under this line of credit.

     In the past, the Company has funded its capital growth expenditures with a
combination of cash flow from operations and debt.  With the exception of the
expansion of its facilities in Oil City, the Company currently believes that
working capital provided by operations will fund capital spending through
fiscal 2000.

Outstanding Litigation
     On May 27, 1999, a jury awarded the Company $1.1 million in its claims
against a vendor of certain cut-off equipment.  In a pre-trial order, the court
ruled that the Company could not collect lost profits and certain other
incidental and consequential damages, and limited the Company's possible
recovery to the purchase price of the equipment plus the cost of improvements
and interest.  The vendor has appealed the jury's verdict and the Company has
appealed the pre-trial order.  There can be no assurances as to what the
outcome of the appeals will be or that ultimate damages collected, if any, will
be commensurate with losses incurred by the Company.  Please see Part I, Item
3: "Legal Proceedings" of this annual report on Form 10-K for additional
information regarding this matter.
<PAGE>
Stock Repurchase Plan
     In March 1999, the Company's Board of Directors approved a plan to acquire
up to $500,000 of its common stock.  Of the approved $500,000 repurchase, the
Company has acquired 95,000 shares of stock for approximately $448,000.

Information Technology and the Year 2000
     Over two years ago, the Company began an evaluation of its information
systems to determine the potential impact of advanced technology on the
Company's operations and profitability.  During the course of this evaluation,
issues surrounding the effect of the year 2000 on date sensitive applications
became more widely publicized and understood.  The Company, recognizing an
opportunity to both update its technology and to address year 2000 concerns,
decided to replace its current information systems with an Enterprise Resource
Planning ("ERP") system.

     In the third quarter of fiscal 1998, the Company purchased and began
installation of a Year 2000 compliant ERP system.  The installation process
consisted of four phases.  The first phase of installation, addressing the
financial, purchasing and plant maintenance functions, was successfully
completed before the end of fiscal 1998.  The remaining three phases include
materials management, shop floor control and production planning.  These
phases were completed (installed and tested) at the Mannford, Oklahoma,
facility in April 1999 and at the Sand Springs, Oklahoma, facility in September
1999.  Final implementation of the same system at the Oil City, Pennsylvania,
facility is scheduled to begin in November 1999.  All Company facilities are
scheduled for completion in December 1999.

     The Company has completed an evaluation of other information technology
systems such as phone systems, e-mail, faxes, local area networks, servers and
personal computers.  All items of consequence are now year 2000 compliant and
the few remaining ones are scheduled to be replaced with Year 2000 compliant
software and equipment before October 31, 1999.  Other important systems,
including equipment used in manufacturing and processing, are basically signal
driven systems where dates play no role in the operating logic.

     The Company is currently trying to determine the impact of year 2000 non-
compliance by third party suppliers.  The impact of such non-compliance could
effect timely delivery of raw materials and cause reductions in orders by
customers who are unable to control their own production and sales process.
The Company completed a survey of critical external business partners in June
1999 and is currently establishing contingency plans designed to protect both
the Company and its customers.  Included in the contingency plans are, for
example; procedures for contacting customers in the event of a supplier
failure, procedures to maintain certain inventory levels; and maintaining Y2K
readiness and contact information for critical vendors and customers.  The
Company expects to complete contingency planning in November 1999.
<PAGE>
     The Company presently believes that with the implementation of the ERP
system and the replacement of other non-compliant systems, the year 2000 issue
will not pose significant operational problems for its computer systems.
However, if installation of the ERP is not completed in a timely manner and
non-compliant systems replaced, the year 2000 issue could have a material
impact on the operations of the Company.   Ramifications could include
mismatched material purchase orders and customer sales orders and a need to
manually operate materials planning, purchasing, order backlog and capacity
planning functions.  A transition to manual operations could result in, among
other things, damage to customer relationships, lost sales, and significant
customer claims.


     As of July 31, 1999, the Company had spent $5.6 million on the ERP system,
and the Company currently estimates another $1.0 million will be expended to
complete the project. Of the $6.6 million total expenditure, over 25 percent is
hardware related, including upgrading the Company's mid-range computers and the
placement of personal computers on the shop floor.  Due to the necessity of
technology upgrades generally, it would be arbitrary to allocate any portion of
this project exclusively to the correction of year 2000 issues,  Therefore, no
such allocation has been attempted.

     The foregoing forward-looking statements, including the costs of
addressing the year 2000 issue and the dates upon which compliance will be
attained, reflect management's current assessment and estimates with respect to
the Company's year 2000 compliance effort.  Various factors could cause actual
plans and results to differ materially from those contemplated by such
assessments, estimates and forward-looking statements, many of which are beyond
the control of the Company.  Some of these factors include, but are not limited
to, third party modification and installation plans, representations by vendors
and customers, technological advances, economic considerations and customer
perceptions.
<PAGE>

ITEM 8.     FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
<AUDIT-REPORT>


REPORT OF INDEPENDENT ACCOUNTANTS



To the Board of Directors and Shareholders of
Webco Industries, Inc.

     In our opinion, the accompanying consolidated balance sheets and the
related consolidated statements of operations, stockholders' equity and cash
flows present fairly, in all material respects, the financial position of Webco
Industries, Inc. and subsidiary at July 31, 1999 and 1998, and the results of
their operations and their cash flows for each of the three years in the period
ended July 31, 1999, in conformity with generally accepted accounting
principles.  In addition, in our opinion, the financial statement schedule
listed in the index appearing under item 14(a)(2), presents fairly, in all
material respects, the information set forth therein when read in conjunction
with the related consolidated financial statements. These financial statements
and financial statement schedule are the responsibility of the Company's
management; our responsibility is to express an opinion on these financial
statements and financial statement schedule based on our audits.  We did not
audit the financial statements of Phillips & Johnston, Inc., a wholly-owned
subsidiary, for the year ended December 31, 1997, which statements reflect
total revenues and net income constituting 8.4 percent and 50.3 percent,
respectively, of the related consolidated totals for the year ended July 31,
1997.  Those statements were audited by other auditors whose report has been
furnished to us, and our opinion, insofar as it relates to the amounts included
for Phillips & Johnston,Inc., is based solely on the report of the other
auditors.  We conducted our audits of these statements in accordance with
generally accepted auditing standards which require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement.  An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement
presentation.  We believe that our audits and the report of the other auditors
provide a reasonable basis for the opinion expressed above.


PricewaterhouseCoopers LLP


Tulsa, Oklahoma
September 16, 1999
</AUDIT-REPORT>
<PAGE>
<AUDIT-REPORT>
REPORT OF INDEPENDENT ACCOUNTANTS


To the Board of Directors and Shareholders of
Phillips & Johnston, Inc.


     We have audited the balance sheet of Phillips & Johnston, Inc. (an
Illinois corporation) as of December 31, 1997, and the related statements of
income, shareholders' equity, and cash flows for the year then ended.  These
financial statements are the responsibility of the Company's management.  Our
responsibility is to express an opinion on these financial statements based on
our audit.

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

     In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Phillips & Johnston, Inc.
as of December 31, 1997, and the results of its operations and its cash flows
for the year then ended in conformity with generally accepted accounting
principles.





                                   DUGAN & LOPATKA
Wheaton, Illinois
June 29, 1998
</AUDIT-REPORT>
<PAGE>
<TABLE>
                          WEBCO INDUSTRIES, INC. AND SUBSIDIARY
                               CONSOLIDATED BALANCE SHEETS
                                 July 31, 1999 and 1998
               (Dollars in thousands, except share amounts and par value)

<CAPTION>
                                                                     1999          1998
                                                                   -------       -------
<S>                                                               <C>           <C>
                                ASSETS
Current assets:
   Cash                                                           $    180      $    266
   Accounts receivable, net                                         17,179        19,874
   Inventories                                                      30,785        27,775
   Prepaid expenses                                                    289           205
   Deferred income tax asset                                         3,013         2,740
                                                                   -------       -------
     Total current assets                                           51,446        50,860

   Property, plant and equipment, net                               64,277        56,630

Notes receivable from related parties                                1,824         1,774

Other assets, net                                                    2,934         2,494
                                                                   -------       -------
     Total assets                                                 $120,481      $111,758
                                                                   =======       =======

                   LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
   Accounts payable                                               $ 12,784      $ 11,760
   Accrued liabilities                                               5,421         6,957
   Current portion of long-term debt                                   895         1,282
                                                                   -------       -------
     Total current liabilities                                      19,100        19,999

Long-term debt                                                      39,746        32,894

Deferred income tax liability                                       11,962        10,620

Commitments and contingencies (Note 7)

Stockholders' equity
   Common stock, $.01 par value, 12,000,000 shares
     authorized, 7,073,723 and 7,169,000 shares issued
     and outstanding in 1999 and 1998, respectively                     71            72
   Additional paid-in capital                                       35,732        36,179
   Retained earnings                                                13,870        11,994
                                                                   -------       -------
     Total stockholders' equity                                     49,673        48,245
                                                                   -------       -------
     Total liabilities and stockholders' equity                   $120,481      $111,758
                                                                   =======       =======
</TABLE>

[FN]
The accompanying notes are an integral part of the consolidated financial
statements.
<PAGE>
<TABLE>
                          WEBCO INDUSTRIES, INC. AND SUBSIDIARY
                          CONSOLIDATED STATEMENTS OF OPERATIONS
                     For the Years Ended July 31, 1999, 1998 and 1997
               (Dollars and shares in thousands, except per share amounts)


<CAPTION>
                                                       1999          1998          1997
                                                     -------       -------       -------
<S>                                                 <C>           <C>           <C>
Net sales                                           $134,744      $151,431      $128,593
Cost of sales                                        113,391       122,945       108,365
                                                     -------       -------       -------
Gross profit                                          21,353        28,486        20,228

Commission income                                       (728)         (758)         (842)
Selling, general and administrative expenses          16,517        17,939        12,952
Special item: Write-off of Mill 3 cut-off equipment        -             -           884
                                                     -------       -------       -------
Income from operations                                 5,564        11,305         7,234

Interest expense                                       2,552         2,296         2,047
                                                     -------       -------       -------
Income before income taxes                             3,012         9,009         5,187

Provision for income taxes                             1,136         2,802         1,256
                                                     -------       -------       -------
Net income                                          $  1,876      $  6,207      $  3,931
                                                     =======       =======       =======
Pro forma net income (1)                                          $  5,511      $  3,179
                                                                   =======       =======

Net income per share:
     Basic                                          $    .26      $    .87      $    .55
                                                     =======       =======       =======
     Diluted                                        $    .26      $    .86      $    .55
                                                     =======       =======       =======
Pro forma net income per share(1):
     Basic                                                        $    .77      $    .44
                                                                   =======       =======
     Diluted                                                      $    .76      $    .44
                                                                   =======       =======
Weighted average shares outstanding:
     Basic                                             7,135         7,169         7,169
                                                     =======       =======       =======
     Diluted                                           7,139         7,245         7,169
                                                     =======       =======       =======

<FN>

(1) Pro forma income taxes have been presented for 1998 and 1997 to
compensate for the S-Corporation tax status of P&J and were calculated using
an effective rate of 38 percent (34% Federal and 4% state).

The accompanying notes are an integral part of the consolidated financial
statements.
</TABLE>
<PAGE>
<TABLE>
                          WEBCO INDUSTRIES, INC. AND SUBSIDIARY
                     CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                     For the Years Ended July 31, 1999, 1998 and 1997
                                 (Dollars in thousands)


<CAPTION>
                                                     Additional                 Total
                                            Common    Paid-In    Retained   Stockholders'
                                             Stock    Capital    Earnings      Equity
                                            ------    -------    --------      ------
<S>                                         <C>      <C>         <C>         <C>
Balances, July 31, 1996                     $   72   $ 36,179    $  6,662    $ 42,913

Distribution to shareholders - P&J               -          -      (1,624)     (1,624)

Net income                                       -          -       3,931       3,931
                                             -----    -------     -------     -------
Balances, July 31, 1997                         72     36,179       8,969      45,220

Distribution to shareholders - P&J               -          -      (2,434)     (2,434)

Elimination of duplicate equity resulting
 from non-conforming fiscal years (Note 2)       -          -        (748)       (748)


Net income                                       -          -       6,207       6,207
                                             -----    -------     -------     -------
Balances, July 31, 1998                         72     36,179      11,994      48,245

Purchases of common stock (Note 9)              (1)      (447)          -        (448)

Net income                                       -          -       1,876       1,876
                                             -----    -------     -------     -------
Balances, July 31, 1999                     $   71   $ 35,732    $ 13,870    $ 49,673
                                             =====    =======     =======     =======

<FN>
The accompanying notes are an integral part of the consolidated financial
statements.
</TABLE>
<PAGE>
<TABLE>
                          WEBCO INDUSTRIES, INC. AND SUBSIDIARY
                          CONSOLIDATED STATEMENTS OF CASH FLOWS
                     For the Years Ended July 31, 1999, 1998 and 1997
                                 (Dollars in thousands)
<CAPTION>
                                                             1999       1998       1997
                                                           -------    -------    -------
<S>                                                       <C>        <C>        <C>
Cash flows from operating activities:
   Net income                                             $  1,876   $  6,207   $  3,931
   Adjustments to reconcile net income to net cash
     provided by (used in) operating activities:
        Depreciation and amortization                        5,158      4,133      3,431
        (Gain) loss on write-off and disposition
          of property, plant and equipment                     (10)        20        928
        Deferred tax expense                                 1,069      2,576      1,196
        (Increase) decrease in:
          Accounts receivable                                2,211     (1,486)    (3,862)
          Inventories                                       (3,010)       657     (6,077)
          Prepaid expenses                                     (84)       158         60
        Increase (decrease) in:
          Accounts payable                                   2,907        (59)    (1,996)
          Accrued liabilities                               (1,536)     2,892        262
                                                           -------    -------    -------
   Net cash provided by (used in) operating activities       8,581     15,098     (2,127)
                                                           -------    -------    -------
Cash flows from investing activities:
   Capital expenditures                                    (12,555)   (10,652)    (9,112)
   Proceeds from sale of property, plant and equipment          21         26        129
   Advances to stockholders                                      -        (38)    (1,286)
   Repayments of stockholder advances                            -          -        124
   Increase in other assets                                   (340)    (1,282)       (36)
                                                           -------    -------    -------
   Net cash used in investing activities                   (12,874)   (11,946)   (10,181)
                                                           -------    -------    -------
Cash flows from financing activities:
   Proceeds from long-term debt                            132,960    143,498    157,725
   Principal payments on long-term debt                   (126,495)  (144,205)  (144,616)
   Dividends paid                                                -     (2,434)    (1,885)
   Purchases of common stock (Note 9)                         (448)         -          -
   Increase (decrease) in book overdrafts                   (1,810)        53        722
                                                           -------    -------    -------
   Net cash provided by (used in ) financing activities      4,207     (3,088)    11,946
                                                           -------    -------    -------
Net increase (decrease) in cash                                (86)        64       (362)

Cash, beginning of period                                      266        202        564
                                                           -------    -------    -------
Cash, end of period                                       $    180   $    266   $    202
                                                           =======    =======    =======
Supplemental disclosure of cash flow information:
   Interest paid, net of amount capitalized of $437,
   $517 and $433 in 1999, 1998 and 1997, respectively     $  2,664   $  2,098   $  2,027

                                                           =======    =======    =======
   Income taxes paid                                      $    467   $      -   $    262
                                                           =======    =======    =======
<FN>
The accompanying notes are an integral part of the consolidated financial
statements.

</TABLE>

<PAGE>
                     WEBCO INDUSTRIES, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


1.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

PRINCIPLES OF CONSOLIDATION - The consolidated financial statements include
the accounts of Webco Industries, Inc. ("Webco" or together with its
subsidiary, the "Company") and its wholly owned subsidiary Phillips & Johnston,
Inc. ("P&J"), a Chicago based sales organization and value-added processor of
tubular products.  All significant intercompany accounts and transactions have
been eliminated in the accompanying financial statements.

NATURE OF OPERATIONS - Webco is a specialty manufacturer of high-quality carbon
and stainless steel tubing products designed to industry and customer
specifications.  Webco's tubing products consist primarily of: welded carbon
heat exchanger and boiler tubing, stainless tube and pipe, and specialty carbon
mechanical tubing for use in consumer durable and capital goods.  The Company's
subsidiary, P&J, represents several manufacturers who produce various non-
competing mechanical and specialty tubular products made from copper, brass,
aluminum and stainless and carbon steel, among others. This access to other
tubing products allows the Company to better serve its customers by offering a
full range of tubing products.  Through its QuikWater division, the Company
manufactures and markets a patented direct contact water heater for commercial
and industrial applications. The Company has three production facilities in
Oklahoma and Pennsylvania and five distribution facilities in Oklahoma, Texas,
Illinois and Michigan, serving more than 1,300 customers throughout North
America.

CONCENTRATIONS - The Company maintains its cash in bank deposit accounts, which
at times may exceed the federal insurance limits.  As of July 31, 1999 and
1998, the Company had cash in banks totaling $1,111,000 and $1,386,000 in
excess of federal depository insurance limits, respectively.  The Company has
not experienced any losses on such accounts in the past.


ACCOUNTS RECEIVABLE - Accounts receivable represent short-term credit granted
to the Company's customers for which collateral is generally not required.
Accounts receivable at July 31, 1999 and 1998, are net of an allowance for
uncollectible amounts of $217,000 and $179,000, respectively.  Credit risk on
receivables is considered by management to be limited due to the variety of
industries served and geographic dispersion of customers.


INVENTORIES - The Company values its inventories at the lower of cost or
market.  Cost for raw materials, work-in-process and finished goods
inventories are determined on the weighted average cost method; maintenance
parts and supplies and structural steel inventories are valued at the lower of
cost (first-in, first-out ("FIFO")) or market.

PROPERTY, PLANT AND EQUIPMENT - Property, plant and equipment, including
tooling, is stated at historical cost and includes interest capitalized on
major construction projects.  Gains or losses on sales and retirements of
property are reflected in operations. Depreciation and amortization are
provided using straight-line and accelerated methods over the following
estimated useful lives: buildings and improvements - 10 to 40 years,
machinery and equipment - 3 to 25 years, computer equipment and software- 3 to
7 years, and furniture and fixtures - 3 to 10 years.
<PAGE>
                     WEBCO INDUSTRIES, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


1.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued

PROPERTY, PLANT AND EQUIPMENT, Continued
Depreciation expense for the years ended July 31, 1999, 1998 and 1997, amounted
to $4,817,000, $3,917,000 and $3,258,000, respectively.  Fully depreciated
assets still in use at July 31, 1999 and 1998, amounted to $10,007,000 and
$8,799,000, respectively.

BOOK OVERDRAFTS - Included in accounts payable at July 31, 1999 and 1998, are
outstanding checks in excess of bank deposits totaling $159,000 and $2,193,000,
respectively.

SPECIAL ITEM  - The special item reflected in the statement of operations for
fiscal year 1997 relates to the write-off of certain Mill 3 cut-off equipment,
which did not work to manufacturer specifications.  The replacement equipment
was capitalized as new equipment upon its purchase and installation during
1997.

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

EARNINGS PER SHARE - Earnings per share are calculated based on the number of
weighted average common shares outstanding, including the effect of dilutive
options when applicable, in accordance with the computation, presentation and
disclosure requirements of Financial Accounting Standards Board Statement No.
128, "Earnings Per Share."

INCOME TAXES - The Company accounts for income taxes in accordance with
Statement of Financial Accounting Standards No. 109, "Accounting for Income
Taxes" ("FAS No. 109").  The provisions of FAS No. 109 require the recording of
deferred tax assets and liabilities to reflect the expected tax consequences in
future years of differences between the tax basis of assets and liabilities and
their financial reporting amounts at each year end.
<PAGE>
                     WEBCO INDUSTRIES, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


2.   BUSINESS COMBINATION

     In June 1998, Webco merged with P&J through the issuance of 830,000 shares
of its common stock for all of the common stock of P&J.  The merger was
accounted for under the pooling of interests method of accounting; accordingly,
all historical financial information is presented as if the two entities have
always been combined.

     Because Webco and P&J had differing fiscal periods prior to the
combination, Webco's financial statements for the year ended July 31, 1997 were
combined with P&J's for the calendar year ended December 31, 1997.  P&J's 1998
financial statements were conformed to the twelve months ended July 31 for
purposes of consolidating with Webco's financial statements for its year ended
July 31, 1998.  As a result of the overlapping period created when P&J's
calendar year was conformed to a July 31 fiscal year, $748,000 of earnings of
P&J (for the period August 1997 through December 1997) were included in
consolidated net income for both fiscal years ended July 31, 1998 and 1997.
Stockholders' equity was adjusted so that the duplicate amount is reflected
only once in retained earnings.

     Prior to the merger, P&J did not incur Federal or state income taxes as it
reported its income for income tax purposes as an S Corporation.  Pro forma net
income amounts reflect consolidated earnings as if P&J accrued taxes at the
statutory (Federal and state) rate of 38 percent.

     Merger-related transaction costs expensed in consolidated results for the
fiscal year ended July 31, 1998, amounted to $565,000 ($350,000 or $.05 per
diluted share after tax).

3.   INVENTORIES

     At July 31, 1999 and 1998, inventories priced using the weighted average
cost method were valued at $28,918,000 and $25,963,000, respectively.
Structural inventories and maintenance parts and supplies inventories, which
are valued using the FIFO method, amounted to $1,867,000 and $1,812,000 at July
31, 1999 and 1998, respectively.

     Inventories at July 31, 1999 and 1998, consisted of the following:

                                               1999            1998
                                               ----            ----
                                              (Dollars in Thousands)

      Raw materials                         $ 16,437        $ 13,614
      Work-in-process                          1,908           1,860
      Finished goods                          10,728          10,664
      Maintenance parts and supplies           1,712           1,637
                                             -------         -------
        Total inventories                   $ 30,785        $ 27,775
                                             =======         =======
<PAGE>
                     WEBCO INDUSTRIES, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


4.   PROPERTY, PLANT AND EQUPMENT
<TABLE>
     Net property, plant and equipment at July 31, 1999 and 1998, consisted of
the following:
<CAPTION>
                                                         1999          1998
                                                         ----          ----
                                                       (Dollars in Thousands)
<S>                                                   <C>           <C>
      Land                                            $  1,436      $  1,436
      Buildings and improvements                        15,519        14,571
      Machinery and equipment                           67,666        60,138
      Computer equipment and software                    7,515         4,285
      Furniture and fixtures                               712           690
      Construction in progress                           5,681         5,261
                                                       -------       -------
                                                        98,529        86,381
      Less accumulated depreciation and amortization    34,252        29,751
                                                       -------       -------
      Net property, plant and equipment               $ 64,277      $ 56,630
                                                       =======       =======

5.   LONG-TERM DEBT

     Long-term debt at July 31, 1999 and 1998, consisted of the following:

                                                         1999          1998
                                                         ----          ----
                                                       (Dollars In Thousands)

      Term loan (A)                                   $ 25,000      $ 25,000
      Revolving loan (A)                                12,615         6,620
      Term loan (B)                                         39           126
      Term loan (C)                                        479             -
      Revolving loan (B)                                   300           800
      Real estate and equipment term loans (D)           1,447           533
      Other note payable (E)                               530           806
      Other                                                231           291
                                                       -------       -------
                                                        40,641        34,176
      Less current maturities                              895         1,282
                                                       -------       -------
      Long-term debt                                  $ 39,746      $ 32,894
                                                       =======       =======

     Based upon the borrowing rates currently available to the Company for
borrowings with similar terms and average maturities, the Company believes that
the carrying amount of its long-term debt approximates fair value.
</TABLE>
<PAGE>
                     WEBCO INDUSTRIES, INC. AND SUBSIDIARY

                   NOTES TO FINANCIAL CONSOLIDATED STATEMENTS


5.   LONG-TERM DEBT, Continued

(A)  The Company has a $25 million term loan and a $25 million revolving line
     of credit with its primary lender. The term loan and revolving credit loan
     bear interest at the prime rate (8.0% at July 31, 1999) plus .25% and
     prime rate, respectively. At the Company's option, borrowings under either
     facility can bear interest at LIBOR (5.18% at July 31, 1999) plus 2.25% in
     the case of the term loan borrowing or plus 2.0% in the case of revolving
     loan advances. These loans mature on August 31, 2002, and are
     collateralized by substantially all of the Company's assets other than the
     Sand Springs and Oil City real estate.  Principal payments on the term
     loan commence on August 1, 2000, at which time monthly payments of
     $208,000 plus interest are required.  The Company may have borrowings and
     outstanding letters of credit ($1,575,000 at July 31, 1999) under the
     revolving credit facility up to the lesser of $25.0 million or an amount
     determined by a formula based on the amount of eligible inventories and
     accounts receivable.  The Company pays a commitment fee of 0.25% per annum
     on any unused and available line of credit.  At July 31, 1999, $9.7
     million was available for borrowing under the line of credit.

     The Company has also arranged for a capital expenditure  ("CAPEX")
     facility in the amount of $5 million to finance equipment at the Oil City,
     Pennsylvania, plant.  The loan matures on August 31, 2002.  At July 31,
     1999, $5 million was available for borrowing under this facility.

     Pursuant to the terms of the loan agreement, the Company is subject to
     various restrictive covenants, including requirements to maintain a
     minimum debt coverage ratio and to not exceed a ratio of indebtedness to
     net worth. The covenants also limit capital expenditures and dividends. In
     addition, the loan agreement provides for acceleration of the loans, at
     the option of the lender, if F. William Weber and Dana S. Weber fail to
     possess the power to direct or cause the direction of management and
     policies of the Company, or the Weber Family ceases to own at least 35% of
     the outstanding voting stock, or upon the occurrence of a material adverse
     change in the business.  The loan agreement also contains a pre-payment
     penalty ranging from 1 to 2 percent of amounts outstanding under the term
     loan plus the revolving commitment if the debts are prepaid prior to
     July 15, 2000.

(B)  The Company's subsidiary, P&J, has a line-of-credit agreement for
     $2,000,000 and a term note of $250,000 with a bank.  The line of credit
     matures on November 30, 1999, bears interest at the lessor of prime rate
     (8.0% at July 31, 1999) or LIBOR (5.18% at July 31, 1999) plus 2%, and is
     collateralized by P&J's assets and guaranteed by Webco.  The term loan
     matures in January 2000 with monthly installments of $8,000 and bears
     interest at 8.10 percent.

(C)  The Company's subsidiary, P&J, has a $500,000 term note with a bank,
     which matures in April 2004.  The note bears interest at 7.5% with monthly
     installments of $10,000, and is collateralized by P&J's assets and
     guaranteed by Webco.
<PAGE>
                     WEBCO INDUSTRIES, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


5.   LONG-TERM DEBT, Continued

(D)  These loans were entered into with various public agencies payable in
     monthly installments aggregating approximately $11,000 including interest
     at rates ranging from 3 to 5.75 percent.  The notes are collateralized by
     the underlying real estate and/or equipment, and the guarantee of the
     principal stockholder/officer.  The notes mature over a 5 to 9 year
     period.

(E)  This note is payable in 36 monthly installments of $30,000 through
     March 31, 2000, and bears interest at 9 percent.

     At July 31, 1998, the aggregate future maturities of long-term debt are as
follows: 2000 - $895,000; 2001 - $2,947,000; 2002 - $2,762,000; 2003 -
$32,947,000; 2004 - $281,000; and thereafter $809,000.

6.   INCOME TAXES

     The provision for income taxes for fiscal 1999, 1998 and 1997 consists of
the following:

                                                   1999       1998       1997
                                                   ----       ----       ----
                                                     (Dollars in Thousands)
Current:
     Federal                                     $     -    $   115    $     -
     State                                            67        111         60
Deferred:
     Federal                                         956      2,305      1,071
     State                                           113        271        125
                                                  ------     ------     ------
     Total income tax expense                    $ 1,136    $ 2,802    $ 1,256
                                                  ======     ======     ======


     Prior to merging with Webco on June 29, 1998, P&J was treated as a
Subchapter S Corporation for income tax purposes, with earnings included in the
personal income tax returns of its stockholders.

     The actual income tax expense for fiscal 1999, 1998 and 1997 differs from
income tax based on the federal statutory rate (34%) due to the following:

                                                     1999      1998      1997
                                                     ----      ----      ----
                                                      (Dollars in Thousands)
     Expected tax expense                          $ 1,024   $ 3,063   $ 1,764

     State income taxes, net of federal benefit        120       386       185

     Exclusion of S Corporation income - P&J             -      (623)     (673)
     Other                                              (8)      (24)      (20)
                                                    ------    ------    ------
     Total income tax expense                      $ 1,136   $ 2,802   $ 1,256
                                                    ======    ======    ======
<PAGE>
                     WEBCO INDUSTRIES, INC. AND SUBSIDIARY

                         NOTES TO FINANCIAL STATEMENTS


6.   INCOME TAXES, Continued

     At July 31, 1999 and 1998, deferred tax assets and deferred tax
liabilities consisted of the following:

                                                           1999          1998
                                                           ----          ----
                                                         (Dollars in Thousands)
     Net current deferred tax assets (liabilities):
         Accounts receivable                             $    100      $     81
         Inventories                                          476           664
         Accrued liabilities                                1,555         1,476
         Operating loss carry forwards                        882           519
                                                          -------       -------
         Net current deferred tax asset                  $  3,013      $  2,740
                                                          =======       =======

     Net non-current deferred tax assets (liabilities):
         Property plant and equipment                    $(12,331)    $(11,255)
         General business credit carry forward                 48          189
         Alternative minimum tax credit carry forward         321          446
                                                          -------      -------
         Net non-current deferred tax liability          $(11,962)    $(10,620)
                                                          =======      =======

     The Company has operating loss carry forwards for regular tax purposes of
approximately $2,320,000 and for alternative minimum tax purposes of
approximately $3,698,000, which expire in 2012 to 2014.

7.   COMMITMENTS AND CONTINGENCIES

LITIGATION - On May 27, 1999, a jury awarded the Company $1.1 million on
Certain claims against an equipment vendor.  Because of a pre-trial ruling by
the courts, the jury was unable to award the Company lost profits and certain
other incidental and consequential damages.  The Company is currently pursuing
attorneys' fees and has appealed the pre-trial order to obtain lost profits.
There can be no assurances that the Company will be successful on appeal or
that if successful, lost profits awarded in the succeeding trial, if any, will
be commensurate with actual lost profits suffered by the Company.  The vendor
has appealed the jury's original verdict and there can be no assurances as to
what the outcome of that appeal will be.  Due to the uncertainty surrounding
the case, the financial statements do not include any portion of the jury award
or other recoveries.

The Company is party to various other lawsuits and claims arising out of the
ordinary course of its business.  Management, believes that any liability
resulting from these matters would not materially affect the results of
operations or the financial position of the Company.
<PAGE>
                     WEBCO INDUSTRIES, INC. AND SUBSIDIARY



                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


7.   COMMITMENTS AND CONTINGENCIES, Continued

LEASES - The Company leases certain buildings and machinery and equipment under
non-cancelable operating leases.  Under certain of these leases the Company is
required to pay property taxes, insurance, repairs and other costs related to
the leased property.  At July 31, 1999, future minimum payments under non-
cancelable leases accounted for as operating leases are $2,151,000 in 2000;
$1,270,000 in 2001; $807,000 in 2002; $636,000 in 2003; and $304,000 in 2004.
Total rent expense for all operating leases was $2,191,000, $2,250,000 and
$1,879,000 in 1999, 1998 and 1997, respectively.

SELF-INSURANCE - The Company maintains a hospitalization and medical
coverage program for its employees.  Claims under this program are limited to
annual losses of $60,000 per participant, and aggregate annual claims of up to
$2,000,000 through the use of a stop-loss insurance policy. Additionally, the
Company self-insures Oklahoma workers' compensation claims up to $225,000 per
occurrence and retains a maximum aggregate liability of $2,000,000 per two-year
policy term with respect to all occurrences.  The Company has a letter of
credit in the amount of $550,000 on file with the State of Oklahoma Workers'
Compensation Court, as required by self-insurance regulations.  Provisions for
claims under both programs are accrued based upon the Company's estimate of the
aggregate liability for claims (including claims incurred, but not yet
reported).  The total provision for self-insurance for medical and workers'
compensation was $1,621,000 and $1,397,000 at July 31, 1999 and 1998,
respectively.

PURCHASE COMMITMENTS - At July 31, 1999 and 1998, the Company was committed on
outstanding purchase orders for inventory approximating $24.7 million and $19.0
million, respectively.  Additionally, the Company had on its premises at July
31, 1999 and 1998, raw material on consignment from certain vendors valued at
approximately $4.1 million and $3.0 million, respectively.

8.   EMPLOYEE BENEFIT PLANS

     The Company maintains 401-K benefit plans covering all employees meeting
certain service requirements.  The plans include a cash or deferred
compensation arrangement permitting elective contributions to be made by the
participants.  Company contributions are made at the discretion of the Board of
Directors.  Company contributions were $419,000, $439,000 and $277,000 in
fiscal 1999, 1998 and 1997, respectively.

9.   STOCKHOLDERS' EQUITY AND STOCK OPTIONS

     In January 1994, the Company's stockholders approved the 1994 Stock
Incentive Plan (the "Plan"), in which directors, employees and consultants are
eligible to participate.  Four types of benefits may be granted in any
combination under the Plan: incentive stock options, non-qualified stock
options, restricted stock and stock appreciation rights.  The Plan also
provides for certain automatic grants to outside directors.  All options expire
ten years from the date of grant (except the vice-chairman's options, which
expire five years from the date of grant) and are exercisable at a price which
is at least equal to fair market value on the date of grant (110% of fair
<PAGE>
                     WEBCO INDUSTRIES, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


9.   STOCKHOLDERS' EQUITY AND STOCK OPTIONS, Continued


market value in the case of the vice-chairman).  The employee options vest
evenly over a period of two to five years from date of grant.  The maximum
number of shares of common stock with respect to which incentive stock options,
non-qualified stock options, restricted stock, and stock appreciation rights
may be issued under the Plan is 850,000.

Activity under the Plan for the last three fiscal years was as follows:

                                          Number of   Weightd Average
                                           Shares      Exercise Price
                                          ---------    --------------
          Balance, July 31, 1996           272,800          $7.89
          Granted                          194,900          $6.05
          Forfeited                       (111,800)         $9.36
                                          --------
          Balance, July 31, 1997           355,900          $6.42
          Granted                          188,600          $7.24
          Forfeited                       ( 30,000)         $6.35
                                          --------
          Balance, July 31, 1998           514,500          $6.69
          Granted                           66,200          $6.17
          Forfeited                       ( 42,700)         $7.23
                                          --------
          Balance, July 31, 1999           538,000          $6.58
                                          ========


Outstanding options and exercisable options at July 31, 1999 were as follows:


                           Number     Weighted Average     Weighted
                             Of           Remaining         Average
       Exercise Prices     Shares     Contractual Life   Exercise Price
       ---------------     ------     ----------------   --------------
     Outstanding:
     $4.75 - $7.00        352,700        6.8 years          $6.22
     $7.19 - $9.25        185,300        8.8 years          $7.27
     Exercisable:
     $4.75 - $7.00        165,780        6.5 years          $6.36
     $7.19 - $9.25         32,820        8.6 years          $7.36


     The weighted average exercise price of options granted to the vice-
chairman during 1997, which were at a price above the market value per share at
that date, was $6.74.
<PAGE>
                     WEBCO INDUSTRIES, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


9.   STOCKHOLDERS' EQUITY AND STOCK OPTIONS, Continued

     The Company has elected to follow APB Opinion No. 25, "Accounting for
Stock Issued to Employees," in accounting for its employee stock options rather
than the alternative fair value accounting provided for under SFAS No. 123,
"Accounting for Stock-Based Compensation."  Under APB No. 25, because the
exercise price of the Company's stock options is at least equal to the market
price of the underlying stock on the date of grant, no compensation expense is
recognized in the Company's financial statements. Pro forma information
regarding net income and earnings per share is required by SFAS No. 123.  This
information is required to be determined as if the Company had accounted for
its employee stock options granted subsequent to July 31, 1995, under the fair
value method of that statement.

     The fair value of options granted in fiscal years 1999, 1998 and 1997
reported below has been estimated at the date of grant using a Black-Scholes
option pricing model with the following assumptions:

                                              1999        1998        1997
                                              ----        ----        ----
       Weighted average life               4.0 years   4.3 years   4.1 years
       Risk-free interest rate               5.14%       5.88%       6.19%
       Expected volatility                    56%         56%         61%
       Expected dividend yield                None        None        None

     The Black-Scholes option valuation model was developed for use in
estimating the fair value of traded options that have no vesting restrictions
and are fully transferable.  In addition, option valuation models require the
input of highly subjective assumptions, including the expected stock price
volatility.  Because the Company's options have characteristics significantly
different from those of traded options, and because changes in the subjective
input assumptions can materially affect the fair value estimate, in the opinion
of management, the existing models do not necessarily provide a reliable single
measure of fair value of its options.  The weighted average estimated fair
value of employee stock options granted during 1999, 1998 and 1997 was $2.88,
$3.61 and $3.18 per share, respectively.   The weighted average estimated fair
value of employee stock options granted during 1997 to the Company's vice-
chairman, which were at a price above the market value per share at that date,
was $2.93.

     For purposes of pro forma disclosures, the estimated fair value of the
options is amortized to expense over the options' vesting period.  The
Company's pro forma information for fiscal years 1999, 1998 and 1997 is as
follows:

                                               1999        1998        1997
                                               ----        ----        ----
     Pro forma net income                    $1,625,000  $5,926,000  $3,747,000
                                              =========   =========   =========
     Pro forma net income per share, diluted     $ 0.23      $ 0.82      $ 0.52
                                                  =====       =====       =====

     The above SFAS No. 123 pro forma disclosures are not necessarily
representative of the effect SFAS No. 123 will have on the pro forma disclosure
of future years.
<PAGE>

                     WEBCO INDUSTRIES, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS




9.   STOCKHOLDERS' EQUITY AND STOCK OPTIONS, Continued

     In March 1999, the Company's Board of Directors approved a plan to acquire
up to $500,000 of its common stock.  Of the approved $500,000 repurchase, the
Company has acquired 95,000 shares of stock for approximately $448,000.

10.  EARNINGS PER SHARE

     Presented below is a reconciliation of the differences between actual
weighted average shares outstanding, which are used in computing basic earnings
per share, and diluted weighted average shares, which are used in computing
diluted earnings per share.


                                                      1999      1998      1997
                                                      ----      ----      ----
                                                        (shares in thousands)
     Basic EPS:
     Weighted average shares outstanding             7,135     7,169     7,169

     Effect of dilutive securities: Options              4        76        -
                                                     -----     -----     -----
     Diluted EPS:
     Diluted weighted average shares outstanding     7,139     7,245     7,169
                                                     =====     =====     =====
     Anti-dilutive options outstanding (1):
        Number of options                              480         8       356
                                                     =====     =====     =====
     Weighted average exercise price                $ 6.76    $ 9.05    $ 6.42
                                                     =====     =====     =====

    (1) Anti-dilutive options and their average exercise prices were not
        included in the computation of diluted earnings per share due to the
        option exercise prices being greater than the average market price of
        the common shares.

11.  SEGMENT INFORMATION

     The Company applies the provisions of FAS 131 "Disclosures about Segments
of an Enterprise and Related Information."  The Company has two reportable
segments: tubing products and QuikWater, representing the Company's two
strategic business units offering different products.  The Company internally
evaluates its business by facility, however, because of the similar economic
characteristics of the tubing operations, including the nature of products,
processes and customers, those operations have been aggregated for segment
reporting purposes.  The tubing products segment manufactures as well as
distributes tubular products principally made of carbon and stainless steel.
QuikWater manufactures a patented direct contact, high efficiency water heater.

<PAGE>
                     WEBCO INDUSTRIES, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


11.  SEGMENT INFORMATION, Continued

     The accounting policies of the segments are the same as those described in
the summary of significant accounting policies.  The Company measures segment
profit or loss as segment income before income taxes.  Information about the
Company's segments is as follows:
<TABLE>
<CAPTION>
                                                Tubing
                                                Products    QuikWater     Total
                                                --------    ---------     -----
                                                    (Dollars in Thousands)
<S>                                             <C>        <C>         <C>
Fiscal year-ended July 31, 1999:
     Revenues                                   $131,282     $3,462    $134,744
     Depreciation and amortization                 5,008        150       5,158
     Interest expense                              2,454         98       2,552
     Segment profit (loss)                         4,630     (1,618)      3,012
     Segment assets                              110,000      3,396     113,396
     Capital expenditures                         12,495         60      12,555

Fiscal year-ended July 31, 1998:
     Revenues                                    149,810      1,621     151,431
     Depreciation and amortization                 4,059         74       4,133
     Interest expense                              2,214         82       2,296
     Segment profit (loss)                        11,053     (2,044)      9,009
     Segment assets                              102,180      3,515     105,695
     Capital expenditures                         10,238        414      10,652

Fiscal year-ended July 31, 1997:
     Revenues                                    127,483      1,100     128,593
     Depreciation and amortization                 3,405         26       3,431
     Interest expense                              2,029         18       2,047
     Segment profit (loss)                         6,782     (1,595)      5,187
     Segment assets                               95,248      2,347      97,595
     Capital expenditures                          8,472        640       9,112
</TABLE>
     A reconciliation of the Company's segment information to the consolidated
financial statements is as follows:
<TABLE>
<CAPTION>
                                                     1999       1998      1997
                                                     ----       ----      ----
                                                        (Dollars in Thousands)
<S>                                              <C>        <C>        <C>
     Total assets reported for segments          $113,396   $105,695   $97,595
     Assets not allocated to segments:
        Current assets                              3,482      3,211     1,947
        Notes receivable and other assets           3,603      2,852     2,600
                                                 --------   --------  --------
     Total assets:                               $120,481   $111,758  $102,142
                                                 ========   ========  ========
</TABLE>
<PAGE>
                     WEBCO INDUSTRIES, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


12.  RELATED PARTY TRANSACTIONS

     In October 1995, the Company entered into an agreement with an entity
owned by the majority stockholders to subcontract certain manufacturing
services.  Payments made by the Company under the contract totaled $612,000
and $412,000 in fiscal 1999 and 1998, respectively.  In addition, the Company
had a receivable balance of $798,000 and $500,000 at July 31, 1999 and 1998,
respectively, for amounts paid on behalf of this entity.

     The Company purchases certain specialty packaging and shipping materials
from an entity owned by the principal stockholder.  Payments made by the
Company totaled $177,000 in fiscal 1999 and $238,000 in fiscal 1998.

     Advances were made from time to time during fiscal 1998 and prior years
(none during 1999) to the principal stockholder with the highest amounts
outstanding being $1,200,000 in 1999 and 1998.  The balance outstanding at
July 31, 1999 and 1998, was $1,200,000.  The advances are subject to a one-year
note from the principal stockholder collateralized by certain assets having a
current market value of at least double the highest outstanding balance
advanced pursuant to the note.  The note bears interest at the prevailing rate
under the Company's loan agreement with its primary lender and is payable at
maturity of the note on August 15, 2000.

     Other advances on various terms were made to certain executives during
fiscal 1999 and 1998, with the highest amount outstanding being $175,000 and
$147,000, respectively.  The balance outstanding at July 31, 1999 and 1998, was
$175,000 and $147,000, respectively.

     During 1994, in the course of purchasing stock from the principal
stockholder, certain executives executed promissory notes payable to the
principal stockholder in the amount of $420,000, which, as amended, bear
interest at 4.1 percent. The notes are collateralized by the underlying shares
of common stock.  The principal stockholder subsequently assigned the
executives' notes receivable to the Company in order to liquidate certain
advances and other amounts owed by him to the Company.

     Accrued interest on the notes receivable from related parties totaled
$484,000 and $379,000 at July 31, 1999 and 1998, respectively, and is included
in other assets in the accompanying balance sheets.
<PAGE>
<TABLE>
                            WEBCO INDUSTRIES, INC.
              SUPPLEMENTAL CONSOLIDATED QUARTERLY FINANCIAL DATA
                                 (UNAUDITED)
                 (Dollars in thousands, except per share data)


<CAPTION>
                                            Year Ended July 31, 1999
                                                 Quarters Ended
                        October 31,    January 31,    April 30,    July 31,     Total
                           1998           1999           1999        1999        Year
                        ----------     ----------     --------     -------   --------
<S>                      <C>            <C>           <C>         <C>       <C>
Net sales                  $36,583        $32,124      $31,970     $34,067   $134,744
Gross profit                 6,967          4,612        4,903       4,871     21,353
Income from operations       2,555            883        1,153         973      5,564
Net income                   1,212            172          347         145      1,876
Net income per diluted
 common share                $ .17         $  .02       $  .05      $  .02     $  .26
Weighted average shares
 outstanding, diluted        7,193          7,186        7,130       7,075      7,139

</TABLE>
<TABLE>
<CAPTION>
                                            Year Ended July 31, 1998
                                                 Quarters Ended
                        October 31,    January 31,    April 30,    July 31,     Total
                           1997           1998           1998        1998        Year
                        ----------     ----------     --------     -------   --------
<S>                       <C>            <C>          <C>         <C>        <C>
Net sales                  $34,538        $37,936      $41,325     $37,632   $151,431
Gross profit                 5,290          6,777        8,741       7,678     28,486
Income from operations       2,010          2,743        3,920       2,632     11,305
Net income                   1,039          1,478        2,310       1,380      6,207
Pro forma net income (1)       845          1,304        2,083       1,279      5,511
Net income per diluted
 common share                $ .14         $  .21       $  .32      $  .19     $  .86
Pro forma net income per
 diluted common share (1)    $ .12          $ .18       $  .29      $  .18     $  .76
Weighted average shares
 outstanding, diluted        7,231          7,209        7,262       7,298      7,245


<FN>
Note: The above quarterly financial data may not total to the annual amounts
because of rounding.

(1) Pro forma income taxes have been presented to compensate for the S-
Corporation tax status of P&J and were calculated using an effective rate of
38 percent (34% Federal and 4% state).
</TABLE>
<PAGE>

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

     There have been no changes in or disagreements between the Company and its
independent auditors.

                                   PART III

ITEM 10.    DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

     The information required by this item is hereby incorporated by reference
from the Company's definitive proxy statement for the Annual Meeting of
Stockholders to be filed with the Securities and Exchange Commission (the
"Commission") within 120 days of the end of the Company's fiscal year.

ITEM 11.    EXECUTIVE COMPENSATION

     The information required by this item is hereby incorporated by reference
from the Company's definitive proxy statement for the annual Meeting of
Stockholders to be filed with the Commission within 120 days of the end of the
Company's fiscal year.

ITEM 12.    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The information required by this item is hereby incorporated by reference
from the Company's definitive proxy statement for the Annual Meeting of
Stockholders to be filed with the Commission within 120 days of the end of the
Company's fiscal year.

ITEM 13.    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     The information required by this item is hereby incorporated by reference
from the Company's definitive proxy statement for the Annual Meeting of
Stockholders to be filed with the Commission within 120 days of the end of the
Company's fiscal year.
<PAGE>
                                         PART IV

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

(a)   The following documents are filed as part of this report:

     (1)     Financial Statements of Webco Industries, Inc. which are included
             in Part II,
             Item 8:

             Reports of Independent Accountants
             Consolidated Balance Sheets as of July 31, 1999 and 1998
             Consolidated Statements of Operations for each of the three years
                 in the period ended July 31, 1999
             Consolidated Statements of Changes in Stockholders' Equity for
                 each of the three years in the period ended July 31, 1999
             Consolidated Statements of Cash Flows for each of the three years
                 in the period ended July 31, 1999
             Notes to Consolidated Financial Statements
             Supplemental Consolidated Quarterly Financial Data (Unaudited)

     (2)     Financial Statement Schedule:
                    Schedule II - Valuation and Qualifying Accounts

     (3)     Exhibits:

Exhibit
Number     Description

3 (i)      Form of Amended and Restated Certificate of Incorporation
           (incorporated by reference to Exhibit 3(i) to the Company's
           Registration Statement on Form S-1, No. 33-72994).

3 (ii)     By-Laws (incorporated by reference to Exhibit 3(ii) to the
           Company's Registration Statement on Form S-1, No. 33-72994).

10.1       Form of 1994 Stock Incentive Plan, as amended (incorporated by
           reference to Exhibit 4.1 to the Company's Registration Statement on
           Form S-8,No. 333-49219).

10.2       Loan and Security Agreement, dated as of July 15, 1997, between
           American National Bank and Trust Company of Chicago, as agent,
           certain financial institutions as lender, and the Company
           (incorporated by reference to Exhibit 10.2 to the Company's Form
           10-K dated July 31, 1997, File No. 0-23242).

10.3       Amendment No. 1 and Waiver Agreement to Loan and Security Agreement
           dated July 15, 1997, between American National Bank and Trust
           Company of Chicago, as agent, certain financial institutions as
           lender, and the Company (incorporated by reference to Exhibit 10.3
           to the Company's Form 10-K dated July 31, 1998, File No. 0-23242).
<PAGE>
ITEM 14.    EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS
            ON FORM 8-K - Continued

Exhibit
Number      Description
-------     -----------
10.4        Lease, dated October 22, 1996, between the Company and Baker
            Performance Chemicals Incorporated (incorporated by reference to
            Exhibit 10.3 to the Company's Form 10-K dated July 31, 1997, File
            No. 0-23242).

10.5        Employment Agreement dated December 31, 1996, between the Company
            and F. William Weber (incorporated by reference to Exhibit 10.4 to
            the Company's Form 10-K dated July 31, 1997, File No. 0-23242).

10.6        Employment Agreement dated December 31, 1996, between the Company
            and Dana S. Weber (incorporated by reference to Exhibit 10.5 to the
            Company's Form 10-K dated July 31, 1997, File No. 0-23242).

10.7        Employment Agreement dated June 30, 1998, between the Phillips &
            Johnston,Inc. Company and Christopher L. Kowalski (incorporated by
            reference to Exhibit 10.7 to the Company's Form 10-K dated July 31,
            1998, File No. 0-23242).

10.8        Lease, dated March 16, 1998, between the Company and Tubular
            Properties,Ltd. (incorporated by reference to Exhibit 10.8 to the
            Company's Form 10-K dated July 31, 1998, File No. 0-23242).

10.9        Agreement and Plan of Reorganization dated as of June 29, 1998 by
            and among Webco Industries, Inc., P&J Acquisition Corp., Phillips &
            Johnston, Inc.,Christopher L Kowalski and Robert N. Pressly
            (incorporated by reference to Exhibit 99.1 to the Company's Form
            8-K, File No. 0-23242).

10.10       Loan and Security Agreement, dated as of April 9, 1997, between
            American National Bank and Trust Company of Chicago, as agent,
            certain financial institutions as lender, and Phillips & Johnston,
            Inc. (incorporated by reference to Exhibit 10.10 to the Company's
            Form 10-K dated July 31, 1998, File No. 0-23242).

10.11       Loan Agreement, dated December 1, 1998, between Pennsylvania
            Economic Development Financing Authority and Webco Industries, Inc.
            (incorporated by reference to Exhibit 10.11 to the Company's Form
            10-Q dated January 31, 1999,File No. 0-23242).

10.12       Reimbursement Agreement, dated as of December 1, 1998, between
            American National Bank and Trust Company of Chicago and Webco
            Industries, Inc. (incorporated by reference to Exhibit 10.12 to the
            Company's Form 10-Q dated January 31, 1999, File No. 0-23242).
<PAGE>
ITEM 14.    EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS
            ON FORM 8-K - Continued

Exhibit
Number      Description
-------     -----------
10.13       Amendment No. 2 to Loan and Security Agreement dated July 15, 1997,
            between American National Bank and Trust Company of Chicago, as
            agent, certain financial institutions as lender, and the Company
            (incorporated by reference to Exhibit 10.13 to the Company's Form
            10-Q dated January 31, 1999, File No. 0-23242).

23.1        Consent of PricewaterhouseCoopers LLP

23.2        Consent of DUGAN & LOPATKA

27.1        Financial Data Schedule


(b) Reports on Form 8-K:
               None
<PAGE>
SIGNATURES

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

               WEBCO INDUSTRIES, INC.

October 20, 1999     By:         /s/ F. William Weber
                                     F. William Weber
                                     Chairman, Chief Executive
                                     Officer and Director

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

October 20, 1999     By:         /s/ F. William Weber
                                     F. William Weber
                                     Chairman, Chief Executive
                                     Officer and Director

October 20, 1999     By:         /s/ Dana S. Weber
                                     Dana S. Weber
                                     President, Chief Operating Officer
                                     and Director

October 20, 1999     By:         /s/ Michael P. Howard
                                     Michael P. Howard
                                     Chief Financial Officer

October 20, 1999     By:         /s/ Christopher L. Kowalski
                                     Christopher L. Kowalski
                                     President-Phillips & Johnston, Inc.

October 20 1999      By:         /s/ Frederick C. Ermel
                                     Frederick C. Ermel
                                     Director

October 20, 1999     By:         /s/ Neven C. Hulsey
                                     Neven C. Hulsey
                                     Director

October 20, 1999     By:         /s/ Kenneth E. Case
                                     Kenneth E. Case
                                     Director
<PAGE>
                            WEBCO INDUSTRIES, INC.


               SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
                    For the Three Years Ended July 31, 1999

                            (Dollars in Thousands)

                                  Additions


                   Balance at   Charged to  Charged to              Balance at
                  Beginning of   Costs and    Other        (1)        End of
Description          Period      Expenses    Accounts   Deductions    Period

Allowance for
 bad debts:
   1997                 110         (2)         -         (59)          49
   1998                  49        139          -          (9)         179
   1999                 179         45          -          (7)         217


    (1)  Amounts represent write-offs, net of recoveries.
<PAGE>
                                                                Exhibit 23.1
Webco Industries, Inc.
9101 West 21st Street
Sand Springs, OK 70463


We consent to the incorporation by reference in the registration statements
of Webco Industries, Inc. on Form S-3 (File No. 333-22779 and 333-67923) and
Form S-8 (File No. 333-49219) of our report dated September 16, 1999,
relating to the consolidated financial statements and financial statement
schedule which appears in this Form 10-K.


PricewaterhouseCoopers LLP

Tulsa, Oklahoma
October 22, 1999

<PAGE>
                                                                Exhibit 23.2




Webco Industries, Inc.
9101 West 21st Street
Sand Springs, OK 70463

We consent to the incorporation by reference in the registration statements
of Webco Industries, Inc. on Form S-3 (File No. 333-22779 and 333-67923) and
Form S-8 (File No. 333-49219) of our report dated June 29, 1998, on our audit
of the financial statements of Phillips & Johnston, Inc. as of December 31,
1997, and for the year ended December 31, 1997, which report is included in
the Annual Report on Form 10-K of Webco Industries, Inc. for the fiscal year
ended July 31, 1999.


Dugan & Lopatka

Wheaton, Illinios
September 21, 1999

<PAGE>