<PAGE>   1


                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                   FORM 10-QSB


[X]    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED APRIL 30, 1998 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 NUMBER 0-13667





                             PDG ENVIRONMENTAL, INC.
             (Exact name of registrant as specified in its charter)





                DELAWARE                                         22-2677298
(State or other jurisdiction of incorporation                 (I.R.S. Employer
            or organization)                                 Identification No.)


300 OXFORD DRIVE, MONROEVILLE, PENNSYLVANIA                         15146
  (Address of principal executive offices)                        (Zip Code)


                                  412-856-2200
              (Registrant's telephone number, including area code)


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

As of June 8, 1998, there were 7,260,072 shares of the registrant's common stock
outstanding.


<PAGE>   2






                    PDG ENVIRONMENTAL, INC. AND SUBSIDIARIES




                                      INDEX




<TABLE>
<CAPTION>
PART I.  FINANCIAL INFORMATION                                                                                  PAGE


    <S>                                                                                                          <C>
    Item 1.   Consolidated Financial Statements and Notes to Consolidated
              Financial Statements


         (a)  Condensed Consolidated Balance Sheets as of April 30, 1998 
              (unaudited) and January 31, 1998                                                                    3

         (b)  Consolidated Statements of Operations for the Three Months Ended
              April 30, 1998 and 1997 (unaudited)                                                                 4

         (c)  Consolidated Statements of Cash Flows for the Three Months Ended
              April 30, 1998 and 1997 (unaudited)                                                                 5

         (d)  Notes to Consolidated Financial Statements (unaudited)                                              6

    Item 2.   Management's Discussion and Analysis of Financial Condition and
              Results of Operations                                                                               9


PART II.  OTHER INFORMATION

    Item 1.   Legal Proceedings                                                                                  11

    Item 3.   Defaults Upon Senior Securities                                                                    11

    Item 6.   Exhibits and Reports on Form 8-K                                                                   11

    Signatures                                                                                                   12
</TABLE>


                                       2
<PAGE>   3



                          PART I. FINANCIAL INFORMATION
                    PDG ENVIRONMENTAL, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                                        APRIL 30,          JANUARY 31,
                                                                                          1998                 1998*
                                                                                       -----------         -----------
                                                                                       (UNAUDITED)
<S>                                                                                    <C>                 <C>        
ASSETS

CURRENT ASSETS
Cash and short-term investments                                                        $   569,000         $   892,000
Accounts receivable - net                                                                9,822,000           6,751,000
Costs and estimated earnings in excess of billings on
  uncompleted contracts                                                                    650,000             725,000
Inventory                                                                                  201,000             202,000
Other current assets                                                                       541,000             426,000
                                                                                       -----------         -----------

TOTAL CURRENT ASSETS                                                                    11,783,000           8,996,000

PROPERTY, PLANT AND EQUIPMENT                                                            4,620,000           4,527,000
Less:  accumulated depreciation                                                         (3,632,000)         (3,558,000)
                                                                                       -----------         -----------
                                                                                           988,000             969,000

OTHER ASSETS                                                                               476,000             372,000
                                                                                       -----------         -----------

TOTAL ASSETS                                                                           $13,247,000         $10,337,000
                                                                                       ===========         ===========

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
Accounts payable                                                                       $ 5,043,000         $ 3,746,000
Billings in excess of costs and estimated earnings
  on uncompleted contracts                                                               1,390,000             842,000
Current portion of long-term debt                                                          194,000             198,000
Accrued liabilities                                                                      1,855,000           1,416,000
                                                                                       -----------         -----------



TOTAL CURRENT LIABILITIES                                                                8,482,000           6,202,000

OTHER LONG-TERM LIABILITIES                                                                140,000             140,000

LONG-TERM DEBT                                                                           1,137,000           1,628,000

MINORITY INTEREST                                                                          441,000             102,000

Stockholders' Equity
Cumulative convertible 2% preferred stock                                                  400,000             400,000
Common stock                                                                               132,000             130,000
Additional paid-in capital                                                               4,790,000           4,571,000
(Deficit) retained earnings                                                             (2,275,000)         (2,836,000)
                                                                                       -----------         -----------

TOTAL STOCKHOLDERS' EQUITY                                                               3,047,000           2,265,000
                                                                                       -----------         -----------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                             $13,247,000         $10,337,000
                                                                                       ===========         ===========
</TABLE>



*Derived from audited financial statements.

See accompanying notes to consolidated financial statements.


                                       3
<PAGE>   4



                    PDG ENVIRONMENTAL, INC. AND SUBSIDIARIES
                      STATEMENTS OF CONSOLIDATED OPERATIONS
                                   (UNAUDITED)


<TABLE>
<CAPTION>
                                                                                            FOR THE THREE MONTHS
                                                                                                ENDED APRIL 30,
                                                                                       ---------------------------------
                                                                                          1998                   1997
                                                                                       -----------           -----------
<S>                                                                                    <C>                   <C>        
CONTRACT REVENUES                                                                      $13,351,000           $ 4,489,000
CONTRACT COSTS                                                                          11,602,000             3,660,000
                                                                                       -----------           -----------

Gross margin                                                                             1,749,000               829,000

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES                                               774,000               627,000
                                                                                       -----------           -----------

Income from operations                                                                     975,000               202,000

OTHER INCOME (EXPENSE):
  Interest expense                                                                         (57,000)              (53,000)
  Interest income                                                                            2,000                 3,000
  Other income                                                                                   -                11,000
                                                                                       -----------           -----------
                                                                                           (55,000)              (39,000)
                                                                                       -----------           -----------

Income before income taxes and minority interest                                           920,000               163,000

INCOME TAX PROVISION                                                                       (20,000)               (5,000)

MINORITY INTEREST                                                                         (339,000)                    -
                                                                                       -----------           -----------

NET INCOME                                                                             $   561,000           $   158,000
                                                                                       ===========           ===========

PER SHARE OF COMMON STOCK:

  BASIC                                                                                $      0.09           $      0.03
                                                                                       ===========           ===========

  DILUTIVE                                                                             $      0.07           $      0.02
                                                                                       ===========           ===========

AVERAGE COMMON SHARES EQUIVALENTS OUTSTANDING                                            6,497,000             5,924,000

AVERAGE DILUTIVE COMMON STOCK EQUIVALENTS
OUTSTANDING                                                                              1,948,000             1,025,000
                                                                                       -----------           -----------

AVERAGE COMMON SHARES AND DILUTIVE COMMON
EQUIVALENTS OUTSTANDING FOR EARNINGS PER
SHARE CALCULATION                                                                        8,445,000             6,949,000
                                                                                       ===========           ===========
</TABLE>





See accompanying notes to consolidated financial statements.


                                       4
<PAGE>   5



                    PDG ENVIRONMENTAL, INC. AND SUBSIDIARIES
                      STATEMENTS OF CONSOLIDATED CASH FLOWS
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                               FOR THE THREE MONTHS
                                                                                                 ENDED APRIL 30,
                                                                                       ---------------------------------
                                                                                           1998                  1997
                                                                                       -----------             ---------
<S>                                                                                    <C>                     <C>      
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income                                                                             $   561,000             $ 158,000
ADJUSTMENTS TO RECONCILE NET INCOME
  (LOSS) TO CASH:
    Depreciation and amortization                                                          162,000                93,000
    Minority Interest                                                                      339,000                     -
    Other                                                                                   (1,000)                    -
CHANGES IN ASSETS AND LIABILITIES
  OTHER THAN CASH:
    Accounts receivable                                                                 (3,071,000)              344,000
    Costs and estimated earnings in excess of billings
      on uncompleted contracts                                                              75,000               (67,000)
    Inventory                                                                                1,000                 7,000
    Prepaid income taxes                                                                     7,000                 1,000
    Other current assets                                                                    84,000                73,000
    Accounts payable                                                                     1,085,000              (249,000)
    Billings in excess of costs and estimated earnings
      on uncompleted contracts                                                             548,000                22,000
    Accrued liabilities                                                                    439,000                87,000
                                                                                       -----------             ---------


                                                                                          (832,000)              218,000
                                                                                       -----------             ---------

NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES                                           229,000               469,000

CASH FLOWS FROM INVESTING ACTIVITIES:
    Purchase of property, plant and equipment                                             (109,000)             (112,000)
                                                                                       -----------             ---------
NET CASH USED BY INVESTING ACTIVITIES                                                     (109,000)             (112,000)

CASH FLOWS FROM FINANCING ACTIVITIES:
    Proceeds from debt                                                                           -                25,000
    Principal payments on debt                                                            (495,000)              (45,000)
    Proceeds from Exercise of Stock Options & Warrants                                      52,000                     -
                                                                                       -----------             ---------

NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES                                          (443,000)              (20,000)
                                                                                       -----------             ---------

Net Increase (Decrease) in Cash and Short-Term Investments                                (323,000)              337,000
Cash and Short-Term Investments, Beginning of Period                                       892,000               429,000
                                                                                       -----------             ---------

CASH AND SHORT-TERM INVESTMENTS, END OF PERIOD                                         $   569,000             $ 766,000
                                                                                       ===========             =========
</TABLE>




See accompanying notes to consolidated financial statements.


                                       5
<PAGE>   6



                    PDG ENVIRONMENTAL, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    FOR THE THREE MONTHS ENDED APRIL 30, 1998
                                   (UNAUDITED)

NOTE 1 -- BASIS OF PRESENTATION

The consolidated financial statements include PDG Environmental, Inc.'s (the
"Corporation") and its wholly-owned subsidiaries. Additionally, the results of
PDG/Philip, LP (the "Venture"), in which the Corporation holds a 60% interest,
are consolidated since the Corporation is the majority owner of the Venture and
exercises day-to-day operating control.

The accompanying consolidated financial statements of the Corporation are
unaudited. However, in the opinion of management, they include all adjustments
necessary for a fair presentation of financial position, results of operations
and cash flows. All adjustments made during the three months ended April 30,
1998 were of a normal, recurring nature. The amounts presented for the three
months ended April 30, 1998 are not necessarily indicative of results of
operations for a full year. Additional information is contained in the Annual
Report on Form 10-KSB of the Corporation for the year ended January 31, 1998,
which should be read in conjunction with this quarterly report.

NOTE 2 - FEDERAL INCOME TAXES

No federal income tax has been provided for the three months ended April 30,
1998 due to the existence of unused net operating loss carryforwards. The
Corporation has recorded a $20,000 provision for state income taxes.

Income taxes paid by the Corporation for the three months ended April 30, 1998
and 1997 totaled approximately $13,000 and $6,000, respectively.

NOTE 3 - LINE OF CREDIT

On May 27, 1997, the Corporation closed on a $375,000 loan from a financial
institution to refinance a $289,000 term loan payable to Drummond Financial
Corporation ("Drummond") maturing on August 1, 1997. The loan is for a
seven-year term at a 9.5% interest rate fixed for the first four years of the
loan. The interest will then be readjusted to the current five year treasury
bill rate plus 3.25% for the remaining three years of the loan. The loan
requires monthly debt service payments of approximately $6,100 which is a
reduction of approximately $10,000 from the debt service on the Drummond term
loan. The remaining proceeds from the loan were utilized to reduce the
outstanding balance on the line of credit with Drummond.

On August 25, 1997, the Corporation closed on a new $2 million credit facility
consisting of a 5-year $0.5 million equipment note and a 3-year revolving line
of credit with a maximum advance of $1.5 million. Both the equipment note and
the line of credit have an interest rate of prime plus 3.5%.

The proceeds of the new financing fully satisfied the remaining outstanding
balance on the Drummond line of credit and provided working capital for the
Corporation. As of April 30, 1998, the outstanding balance on the new revolving
line of credit was $473,000.

During fiscal 1996, the registrant entered into two agreements guaranteeing
ICHOR Corporation's ("ICHOR") accounts receivable financed by Sirrom
Environmental Funding, LLC ("Sirrom"). At April 30, 1998, the balance guaranteed
by the Corporation under the two agreements was approximately $300,000. It is
expected that the remaining outstanding receivables covered by the guarantee
will be paid by ICHOR's customer during the first half of Fiscal 1999,
eliminating the registrant's remaining guarantee.

The Corporation paid interest costs totaling approximately $36,000 and $54,000
during the three months ended April 30, 1998 and 1997, respectively.



                                       6
<PAGE>   7



NOTE 4 - PREFERRED STOCK

Cumulative dividends in arrears on the Corporation's 2% Series A Preferred Stock
were approximately $157,000 at April 30, 1998. At April 30, 1998, there were
167,338 shares of Series A Preferred Stock outstanding. Each share of Series A
Preferred Stock is convertible into four shares of the Corporation's common
stock at the option of the preferred stockholder.

The conversion rate on the Series A Preferred Stock is also subject to
adjustment as a result of certain changes in the Corporation's capital structure
or distributions to common stockholders (except for cash dividends permissible
under law).

NOTE 5 - NET EARNINGS PER SHARE

The following table sets forth the computation of basic and diluted earnings per
share:


<TABLE>
<CAPTION>
                                                                                             FOR THE THREE MONTHS
                                                                                                 ENDED APRIL 30,
                                                                                         1998                    1997
                                                                                      ----------------------------------
<S>                                                                                   <C>                     <C>       
NUMERATOR:

  Net Income                                                                          $  561,000              $  158,000
  Preferred stock dividends                                                               (8,000)                 (9,000)
                                                                                      ----------              ----------

  Numerator for basic earnings per share--income available
      to common stockholders                                                             553,000                 149,000

  Effect of dilutive securities:
      Preferred stock dividends                                                            8,000                   9,000
                                                                                      ----------              ----------

  Numerator for diluted earnings per share--income available to
      common stock after assumed conversions                                             561,000                 158,000
                                                                                      ----------              ----------

DENOMINATOR:

  Denominator for basic earnings per share--weighted average shares                    6,497,000               5,924,000

  Effect of dilutive securities:
    Employee stock options                                                               860,000                 173,000
    Warrants                                                                             356,000                  58,000
    Convertible preferred stock                                                          732,000                 794,000
                                                                                      ----------              ----------

  Dilutive potential common shares                                                     1,948,000               1,025,000
                                                                                      ----------              ----------
    Denominator for diluted earnings per share--adjusted
    weighted-average shares and assumed conversions                                    8,445,000               6,949,000
                                                                                      ==========              ==========

BASIC EARNINGS PER SHARE                                                              $     0.09              $      0.03
                                                                                      ==========              ==========

DILUTED EARNINGS PER SHARE                                                            $     0.07              $     0.02
                                                                                      ==========              ==========
</TABLE>




                                       7
<PAGE>   8




NOTE 6 - COMMITMENTS AND CONTINGENCIES

As discussed in further detail in Item 3. Legal Proceedings contained in the
Corporation's Annual Report on Form 10-KSB for the year ended January 31, 1998,
the Corporation, PDGR, certain of PDGR's officers and directors and the
underwriters of PDGR's initial public offering have been named as defendants in
a purported class action lawsuit involving the purchase by all persons and
entities of PDGR's common stock from February 9, 1995, through May 23, 1995. The
action alleges that the defendants violated certain federal securities laws.

On June 8, 1998 an agreement in principle to settle out of court was reached
with the plaintiffs' attorneys in the class action lawsuit. Approval by both the
Court and members of the class is still required. If approved, the Defendants,
PDG Environmental and ICHOR (formerly PDG Remediation), will pay a total of
$432,500 to settle the lawsuit. PDG Environmental's share of the settlement will
be $173,000.




                                       8
<PAGE>   9



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

RESULTS OF OPERATIONS

THREE MONTHS ENDED APRIL 30, 1998 AND 1997

During the three months ended April 30, 1998 ("Fiscal 1999"), the Corporation's
contract revenues increased to $13.4 million compared to $4.5 million in the
three months ended April 30, 1997 ("Fiscal 1998"). The increase was due to the
Corporation entering the current fiscal year with a greater backlog of contracts
and the significant contribution to revenue that the $12 million Keystone
contract made in the current quarter.

The Corporation's gross margin increased to $1.7 million in the first quarter of
fiscal 1999 compared to $0.8 million in the first quarter of fiscal 1998. The
increase in gross margin in total is due to increased levels of revenues. The
contract margin as a percentage of revenue decreased as, traditionally, larger
contracts are bid at lower margins.

Selling, general and administrative expenses increased to $0.78 million in the
three months ended April 30, 1998 compared to $0.63 million in the same quarter
of the previous fiscal year. During the current fiscal quarter, the Corporation
had two additional branch offices, and more costs were incurred to support a
higher level of operations.

The Corporation reported income from operations of $1.0 million for the three
months ended April 30, 1998 compared to income from operations of $0.2 million
for the three months ended April 30, 1997 as a direct result of the factors
discussed above.

Interest expense remained constant in the current quarter as compared to the
same quarter of a year ago.

During the quarter ended April 30, 1998, the Corporation made no provision for
federal income taxes due to the utilization of net operating loss carryforwards
for financial reporting purposes. A state income tax provision of $20,000 was
made in the current fiscal quarter while a provision of $5,000 was made in the
prior fiscal quarter.

LIQUIDITY AND CAPITAL RESOURCES

During the three months ended April 30, 1998, the Corporation's cash decreased
by $0.32 million to $0.57 million compared to an increase in cash and short-term
investments of $0.34 million in the three months ended April 30, 1997.

Cash generated from operating activities totaled $0.2 million in the three
months ended April 30, 1998. Cash inflows included $0.6 million related to net
income generated during the current three months, $0.1 million due to a decrease
in other current assets, a $1.1 million increase in accounts payable, primarily
associated with the Keystone project, a $0.5 million increase in billings in
excess of costs and estimated earnings on uncompleted contracts, a $0.4 million
increase in accrued liabilities related to the timing of payments, $0.2 million
of depreciation and amortization and a $0.3 million increase in minority
interest relating to the Keystone contract. These cash inflows were partially
offset by cash outflows of $3.1 million due to an increase in accounts
receivable related primarily to the Keystone project.

The decrease in cash and short term investments during the first quarter of
fiscal 1999 is attributable to cash inflows from operations of $0.2 million,
offset by cash outflows of $0.1 million for the purchase of property, plant and
equipment, and $0.4 million for the repayment of debt partially offset by the
proceeds from the exercise of stock options and warrants.

During the three months ended April 30, 1997, the Corporation's cash increased
by $0.34 million to $0.77 million.




                                       9
<PAGE>   10



Cash flows from operating activities totaled $0.5 million in the three months
ended April 30, 1997. Cash inflows included $0.2 million related to net income
generated during the current three months, a $0.3 million decrease in accounts
receivables, $0.1 million due to a decrease in other current assets, a $0.1
million increase in accrued liabilities related to the timing of payments and
$0.1 million of depreciation and amortization. These cash inflows were offset by
cash outflows which principally included a $0.1 million increase in costs and
estimated earnings in excess of billings on uncompleted contracts related to the
timing of certain contract activity and a $0.2 million decrease in accounts
payable related to the timing of vendor payments.

The increase in cash and short term investments during the first quarter of
fiscal 1998 is attributable to cash inflows from operations of $0.5 million.
These inflows were offset by outflows used to fund financing activities of $0.02
million and cash outflows to fund investing activities of $0.11 million. The
cash outflows relative to investing activities were for the purchase of
property, plant and equipment, and the cash outflows relating to financing
activities were for the repayment of debt net of proceeds from the financing of
a vehicle.

At April 30, 1998, the Corporation's backlog associated with its asbestos
abatement business totaled $20.6 million ($11.0 million on fixed fee contracts
and $9.6 million on time and materials or unit price contracts).




                                       10
<PAGE>   11



                           PART II-- OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

With respect to the action captioned Klein v. PDG Remediation, Inc., described
in the Corporation's Form 10-K for the year ended January 31, 1998.

On June 8, 1998 an agreement in principle to settle out of court was reached
with the plaintiffs' attorneys in the class action lawsuit. Approval by both the
Court and members of the class is still required. If approved, the Defendants,
PDG Environmental and ICHOR (formerly PDG Remediation), will pay a total of
$432,500 to settle the lawsuit. PDG Environmental's share of the settlement will
be $173,000.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

The registrant is currently in arrears with respect to the payment of dividends
on its Series A Preferred Stock. At April 30, 1998, the cumulative dividends in
arrears on the Series A Preferred Stock were approximately $157,000.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(a)     Exhibits:
                                  EXHIBIT INDEX
                           EXHIBIT NO. AND DESCRIPTION

<TABLE>
<CAPTION>
                                                                                                       PAGES OF SEQUENTIAL
                                                                                                         NUMBERING SYSTEM
<S>     <C>
10(a)   Professional Consulting Agreement dated April 24, 1998 between Len Turano
        and PDG Environmental, Inc.

27.     Financial data schedule

(b)     Reports on Form 8-K
</TABLE>


The registrant did not file any current reports on Form 8-K during the three
months ended April 30, 1998.


                                       11
<PAGE>   12





                                   SIGNATURES

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




                                       PDG ENVIRONMENTAL, INC.




                                       By   /s/John C. Regan
                                         ---------------------------------------
                                            John C. Regan
                                            Chairman and Chief Executive Officer











Date:  June 12, 1998


                                       12