SECURITIES AND EXCHANGE COMMISSION

                              Washington, DC 20549
              ----------------------------------------------------

                                    FORM 10-Q

(mark one)
[ X ] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
      Exchange Act of 1934 for the Quarter Ended July 3, 1999

[   ] Transition Report Pursuant to Section 13 or 15(d) of the Securities
      Exchange Act of 1934

                         Commission File Number 1-13975

                                ONIX SYSTEMS INC.
             (Exact name of Registrant as specified in its charter)

Delaware                                                             76-0546330
(State or other jurisdiction of            (I.R.S. Employer Identification No.)
 incorporation or organization)

22001 North Park Drive
Kingwood, Texas                                                      77339-3804
(Address of principal executive offices)                             (Zip Code)

       Registrant's telephone number, including area code: (781) 622-1000

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 the number of shares outstanding of each of the issuer's classes of
Common Stock, as of the latest practicable date.

           Class                         Outstanding at July 30, 1999
  Common Stock, $.01 par value                     14,357,524

<PAGE>
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PART I - FINANCIAL INFORMATION

Item 1 - Financial Statements

                                ONIX SYSTEMS INC.

                           Consolidated Balance Sheet
                                   (Unaudited)

                                     Assets
<S>                                                                                 <C>        <C>

                                                                                       July 3, January 2,
(In thousands)                                                                            1999      1999
----------------------------------------------------------------------------------- ---------- ----------

Current Assets:
 Cash and cash equivalents (includes $768 and $30,743 under repurchase                $  6,997    $33,373
   agreements with affiliated company)
 Advance to affiliate (Note 7)                                                          28,921          -
 Accounts receivable, less allowances of $1,974 and $1,941                              36,876     34,476
 Inventories:
   Raw materials and supplies                                                           14,971     13,928
   Work in process                                                                       8,852     11,596
   Finished goods                                                                        4,461      6,476
 Deferred tax asset                                                                      4,753      4,772
 Prepaid expenses and other current assets                                               1,421      1,241
                                                                                      --------   --------

                                                                                       107,252    105,862
                                                                                      --------   --------

Property, Plant, and Equipment, at Cost                                                 19,118     17,566
 Less:  Accumulated depreciation and amortization                                        8,343      7,430
                                                                                      --------   --------

                                                                                        10,775     10,136
                                                                                      --------   --------

Other Assets                                                                               295        302
                                                                                      --------   --------

Cost in Excess of Net Assets of Acquired Companies                                      62,788     64,278
                                                                                      --------   --------

                                                                                      $181,110   $180,578
                                                                                      ========   ========


                                       2
<PAGE>

                                ONIX SYSTEMS INC.
                     Consolidated Balance Sheet (continued)
                                   (Unaudited)

                    Liabilities and Shareholders' Investment

                                                                                       July 3, January 2,
(In thousands except share amounts)                                                       1999       1999
----------------------------------------------------------------------------------- ---------- ----------

Current Liabilities:
 Borrowings under overdraft facility                                                  $  4,091    $ 1,017
 Accounts payable                                                                       10,419      9,408
 Accrued payroll and employee benefits                                                   3,788      3,981
 Accrued installation and warranty costs                                                 1,081      1,294
 Accrued income taxes                                                                    1,487      1,262
 Deferred revenue                                                                        1,275      5,429
 Other accrued expenses (Notes 5 and 6)                                                  6,805      7,347
 Due to parent company and affiliated companies                                          2,014      1,281
                                                                                      --------   --------

                                                                                        30,960     31,019
                                                                                      --------   --------

Deferred Income Taxes                                                                    2,837      2,837
                                                                                      --------   --------

Other Deferred Items                                                                       168        175
                                                                                      --------   --------

Shareholders' Investment:
 Common stock, $.01 par value, 50,000,000 shares authorized;                               156        156
   15,613,307 and 15,606,307 shares issued
 Capital in excess of par value                                                        144,801    144,752
 Retained earnings                                                                      13,122     11,150
 Treasury stock at cost, 1,255,783 shares                                               (9,995)    (9,995)
 Deferred compensation                                                                     (41)         -
 Accumulated other comprehensive items (Note 2)                                           (898)       484
                                                                                      --------   --------

                                                                                       147,145    146,547
                                                                                      --------   --------

                                                                                      $181,110   $180,578
                                                                                      ========   ========















The accompanying notes are an integral part of these consolidated financial
statements.

                                       3
<PAGE>

                                ONIX SYSTEMS INC.

                        Consolidated Statement of Income
                                   (Unaudited)

                                                                                      Three Months Ended
                                                                                       July 3,    July 4,
(In thousands except per share amounts)                                                   1999       1998
----------------------------------------------------------------------------------- ----------- ----------

Revenues                                                                               $34,716    $38,439
                                                                                       -------    -------

Costs and Operating Expenses:
 Cost of revenues                                                                       21,832     21,930
 Selling, general, and administrative expenses                                           9,306      9,529
 Research and development expenses                                                       2,378      2,388
 Restructuring costs, net (Note 6)                                                         308          -
                                                                                       -------     ------

                                                                                        33,824     33,847
                                                                                       -------    -------

Operating Income                                                                           892      4,592

Interest Income                                                                            380        717
Interest Expense (includes $16 to related party in 1998)                                   (36)       (16)
Other Expense                                                                              (20)         -
                                                                                       -------     ------

Income Before Provision for Income Taxes                                                 1,216      5,293
Provision for Income Taxes                                                                 474      2,090
                                                                                       -------     ------

Net Income                                                                             $   742     $3,203
                                                                                       =======     ======

Basic and Diluted Earnings per Share (Note 3)                                          $   .05     $  .21
                                                                                       =======     ======

Weighted Average Shares (Note 3):
 Basic                                                                                  14,358     15,606
                                                                                       =======     ======

 Diluted                                                                                14,358     15,610
                                                                                       =======     ======

















The accompanying notes are an integral part of these consolidated financial
statements.

                                       4
<PAGE>

                                ONIX SYSTEMS INC.

                        Consolidated Statement of Income
                                   (Unaudited)

                                                                                        Six Months Ended
                                                                                       July 3,    July 4,
(In thousands except per share amounts)                                                   1999       1998
----------------------------------------------------------------------------------- ----------- ----------

Revenues                                                                               $68,735    $75,583
                                                                                       -------    -------

Costs and Operating Expenses:
 Cost of revenues                                                                       43,671     43,554
 Selling, general, and administrative expenses                                          17,672     19,162
 Research and development expenses                                                       4,607      4,565
 Restructuring costs, net (Note 6)                                                         281          -
                                                                                       -------    -------

                                                                                        66,231     67,281
                                                                                       -------    -------

Operating Income                                                                         2,504      8,302

Interest Income                                                                            785        976
Interest Expense (includes $277 to related party in 1998)                                  (56)      (277)
                                                                                       -------    -------

Income Before Provision for Income Taxes                                                 3,233      9,001
Provision for Income Taxes                                                               1,261      3,581
                                                                                       -------    -------

Net Income                                                                             $ 1,972    $ 5,420
                                                                                       =======    =======

Basic and Diluted Earnings per Share (Note 3)                                          $   .14    $   .39
                                                                                       =======    =======

Weighted Average Shares (Note 3):
 Basic                                                                                  14,356     14,065
                                                                                       =======    =======

 Diluted                                                                                14,356     14,070
                                                                                       =======    =======


















The accompanying notes are an integral part of these consolidated financial
statements.



                                       5
<PAGE>

                                ONIX SYSTEMS INC.

                      Consolidated Statement of Cash Flows
                                   (Unaudited)

                                                                                        Six Months Ended
                                                                                       July 3,    July 4,
(In thousands)                                                                            1999       1998
----------------------------------------------------------------------------------- ----------- ----------

Operating Activities:
 Net income                                                                           $  1,972    $ 5,420
 Adjustments to reconcile net income to net cash provided by (used in)
   operating activities:
     Depreciation and amortization                                                       2,131      2,078
     Noncash restructuring costs (Note 6)                                                  149          -
     Provision for losses on accounts receivable                                           166        127
     Other noncash items                                                                    18          -
     Changes in current accounts:
       Accounts receivable                                                              (3,113)    (3,024)
       Inventories                                                                       3,151       (274)
       Other current assets                                                               (205)      (664)
       Accounts payable                                                                  1,979     (3,841)
       Other current liabilities                                                        (4,655)      (339)
     Other                                                                                   -         (5)
                                                                                      --------    -------

        Net cash provided by (used in) operating activities                              1,593       (522)
                                                                                      --------    -------

Investing Activities:
 Payment to affiliated company for acquired business                                         -    (19,117)
 Refund of acquisition purchase price                                                        -        424
 Advances to affiliate, net (Note 7)                                                   (28,921)         -
 Purchases of property, plant, and equipment                                            (2,229)      (769)
 Proceeds from sale of property, plant, and equipment                                       60        238
                                                                                      --------    -------

        Net cash used in investing activities                                          (31,090)   (19,224)
                                                                                      --------    -------

Financing Activities:
 Increase in borrowings under overdraft facility                                         3,186          -
 Net proceeds from issuance of Company common stock                                          -     43,188
 Issuance of note payable to parent company                                                  -     12,000
 Repayment of note payable to parent company                                                 -    (12,000)
                                                                                      --------    -------

        Net cash provided by financing activities                                        3,186     43,188
                                                                                      --------    -------

Exchange Rate Effect on Cash                                                               (65)        94
                                                                                      --------    -------

Increase (Decrease) in Cash and Cash Equivalents                                       (26,376)    23,536
Cash and Cash Equivalents at Beginning of Period                                        33,373     24,960
                                                                                      --------    -------

Cash and Cash Equivalents at End of Period                                            $  6,997    $48,496
                                                                                      ========    =======



The accompanying notes are an integral part of these consolidated financial
statements.

                                       6
<PAGE>


                   Notes to Consolidated Financial Statements

1.    General

      The interim consolidated financial statements presented have been prepared
by ONIX Systems Inc. (the Company) without audit and, in the opinion of
management, reflect all adjustments of a normal recurring nature necessary for a
fair statement of the financial position at July 3, 1999, the results of
operations for the three- and six-month periods ended July 3, 1999, and July 4,
1998, and the cash flows for the six-month periods ended July 3, 1999, and July
4, 1998. Interim results are not necessarily indicative of results for a full
year.

      The consolidated balance sheet presented as of January 2, 1999, has been
derived from the consolidated financial statements that have been audited by the
Company's independent public accountants. The consolidated financial statements
and notes are presented as permitted by Form 10-Q and do not contain certain
information included in the annual financial statements and notes of the
Company. The consolidated financial statements and notes included herein should
be read in conjunction with the financial statements and notes included in the
Company's Annual Report on Form 10-K for the fiscal year ended January 2, 1999,
filed with the Securities and Exchange Commission.

2.    Comprehensive Income

      Comprehensive income combines net income and "other comprehensive items,"
which represents foreign currency translation adjustments, reported as a
component of shareholders' investment in the accompanying balance sheet. During
the second quarter of 1999 and 1998, the Company's comprehensive income totaled
$185,000 and $3,124,000, respectively. During the first six months of 1999 and
1998, the Company's comprehensive income totaled $590,000 and $5,587,000,
respectively.
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3.    Earnings per Share

      Basic and diluted earnings per share were calculated as follows:
<S>                                                           <C>        <C>         <C>        <C>

                                                                 Three Months Ended      Six Months Ended
                                                                July 3,     July 4,    July 3,     July 4,
(In thousands except per share amounts)                            1999        1998       1999        1998
------------------------------------------------------------- ---------- ----------- ---------- ----------

Basic
Net Income                                                       $  742     $ 3,203     $1,972     $ 5,420
                                                                 ------     -------     ------     -------

Weighted Average Shares                                          14,358      15,606     14,356      14,065
                                                                 ------     -------     ------     -------

Basic Earnings per Share                                         $  .05     $   .21     $  .14     $   .39
                                                                 ======     =======     ======     =======

Diluted
Net Income                                                       $  742     $ 3,203     $1,972     $ 5,420
                                                                 ------     -------     ------     -------

Weighted Average Shares                                          14,358      15,606     14,356      14,065
Effect of Stock Options                                               -           4          -           5
                                                                 ------     -------     ------     -------

Weighted Average Shares, as Adjusted                             14,358      15,610     14,356      14,070
                                                                 ------     -------     ------     -------

Diluted Earnings per Share                                       $  .05     $   .21     $  .14     $   .39
                                                                 ======     =======     ======     =======

      The computation of diluted earnings per share for each period excludes the
effect of assuming the exercise of certain outstanding stock options because the
effect would be antidilutive. As of July 3, 1999, there were 679,000 of such
options outstanding, with exercise prices ranging from $6.93 to $14.25 per
share.

                                       7
<PAGE>

4.     Business Segment Information

                                                                Three Months Ended        Six Months Ended
                                                                July 3,     July 4,    July 3,     July 4,
(In thousands)                                                     1999        1998       1999        1998
------------------------------------------------------------- ---------- ----------- ---------- ----------

Revenues:
 Measurement Instruments                                        $23,618    $ 26,909    $45,176    $ 55,577
 Industry-specific Systems                                       11,098      11,530     23,559      20,006
                                                                -------    --------    -------    --------

                                                                $34,716    $ 38,439    $68,735    $ 75,583
                                                                =======    ========    =======    ========

Income Before Provision for Income Taxes:
 Measurement Instruments                                        $ 1,124    $  2,954    $ 1,954    $  6,370
 Industry-specific Systems                                          335       2,146      1,718       3,122
 Corporate (a)                                                     (567)       (508)    (1,168)     (1,190)
                                                                -------    --------    -------    --------

 Total operating income                                             892       4,592      2,504       8,302
 Interest income, net                                               324         701        729         699
                                                                -------    --------    -------    --------

                                                                $ 1,216    $  5,293    $ 3,233    $  9,001
                                                                =======    ========    =======    ========

(a)  Primarily general and administrative expenses.

5.     Accrued Acquisition Expenses

      The Company has undertaken restructuring activities at certain acquired
businesses. The Company's restructuring activities, which were accounted for in
accordance with Emerging Issues Task Force Pronouncement (EITF) 95-3, primarily
have included reductions in staffing levels and the abandonment of excess
facilities. In connection with these restructuring activities, as part of the
cost of acquisitions, the Company established reserves, primarily for severance
and excess facilities. In accordance with EITF 95-3, the Company finalizes its
restructuring plans no later than one year from the respective dates of the
acquisitions. Amounts accrued at July 3, 1999, represent ongoing payments for
severance and abandoned facilities. A summary of the changes in accrued
acquisition expenses, which are included in other accrued expenses in the
accompanying balance sheet, follows:
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<S>                                                             <C>            <C>           <C>

                                                                                Abandonment
                                                                                  of Excess
(In thousands)                                                      Severance    Facilities         Total
--------------------------------------------------------------- -------------- ------------- -------------

Balance at January 2, 1999                                              $ 171          $170          $ 341
 Usage                                                                    (69)         (124)          (193)
 Currency translation adjustment                                           (6)            -             (6)
                                                                        -----          ----          -----

Balance at July 3, 1999                                                 $  96          $ 46          $ 142
                                                                        =====          ====          =====

6.     Restructuring Costs

      During 1998, the Company recorded restructuring costs, which were
accounted for in accordance with EITF 94-3, primarily for severance for 90
employees and abandonment of facilities. As of January 2, 1999, the Company had
terminated 46 employees and had $435,000 accrued for severance and
facility-closing costs relating to these activities. During the first six months
of 1999, the Company terminated 32 additional employees and determined that the
remaining 12 will not be terminated. Accordingly, the Company has reversed the
remaining $148,000 of

                                       8
<PAGE>


6.     Restructuring Costs (continued)

previously established restructuring reserves. During the second quarter of
1999, the Company incurred restructuring costs of $445,000, which consisted of
$296,000 related to severance costs for 23 employees, primarily in manufacturing
positions, and $149,000 to write off fixed assets no longer of use. During the
second quarter of 1999, the Company terminated 10 employees under this
restructuring plan. The Company expects to complete the implementation of its
restructuring plan undertaken in 1999 during the third quarter of 1999. A
summary of the changes in accrued restructuring costs, which are included in
other accrued expenses in the accompanying balance sheet, follows:

                                                                                Abandonment
                                                                                  of Excess
(In thousands)                                                      Severance    Facilities         Total
--------------------------------------------------------------- -------------- ------------- -------------

Balance at January 2, 1999                                             $  366         $  69         $  435
 Charged to expense                                                       296             -            296
 Reversal of reserve                                                     (148)          (16)          (164)
 Usage                                                                   (302)          (52)          (354)
 Currency translation adjustment                                           (6)           (1)            (7)
                                                                       ------         -----         ------

Balance at July 3, 1999                                                $  206         $   -         $  206
                                                                       ======         =====         ======

7.     Cash Management Arrangement

      Effective June 1, 1999, the Company and Thermo Electron Corporation
commenced use of a new domestic cash management arrangement. Under the new
arrangement, amounts advanced to Thermo Electron by the Company for domestic
cash management purposes bear interest at the 30-day Dealer Commercial Paper
Rate plus 50 basis points, set at the beginning of each month. Thermo Electron
is contractually required to maintain cash, cash equivalents, and/or immediately
available bank lines of credit equal to at least 50% of all funds invested under
this cash management arrangement by all Thermo Electron subsidiaries other than
wholly owned subsidiaries. The Company has the contractual right to withdraw its
funds invested in the cash management arrangement upon 30 days' prior notice.
Amounts invested in this arrangement are included in "advance to affiliate" in
the accompanying balance sheet.

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

      Forward-looking statements, within the meaning of Section 21E of the
Securities Exchange Act of 1934, are made throughout this Management's
Discussion and Analysis of Financial Condition and Results of Operations. For
this purpose, any statements contained herein that are not statements of
historical fact may be deemed to be forward-looking statements. Without limiting
the foregoing, the words "believes," "anticipates," "plans," "expects," "seeks,"
"estimates," and similar expressions are intended to identify forward-looking
statements. There are a number of important factors that could cause the results
of the Company to differ materially from those indicated by such forward-looking
statements, including those detailed under the heading "Forward-looking
Statements" in Exhibit 13 to the Company's Annual Report on Form 10-K for the
fiscal year ended January 2, 1999, filed with the Securities and Exchange
Commission.

                                       9
<PAGE>

Overview

      The Company designs, develops, markets, and services sophisticated field
measurement instruments and on-line sensors for the process control industry.
Incorporating advanced measurement technologies, the Company's products provide
real-time data collection, analysis, and local control functions to enhance
production efficiency, improve process and quality control, ensure regulatory
compliance, and increase employee safety in industries where production
processes require continuous monitoring, analysis, and measurement. The
Company's products and services are offered through two segments: Measurement
Instruments, which serve the process analysis and measurement needs of a range
of process industries, and Industry-specific Systems, which are developed to
meet the specific process measurement and analysis needs of select industries,
principally oil and gas producers.

      An element of the Company's strategy is to supplement its internal growth
by acquiring businesses with complementary products and technologies. The
Company has completed several such acquisitions, including the Mid-South
Companies in July 1998.

      The Company's products are sold primarily to participants in process
industries, including oil and gas producers, processors, refiners, pipelines,
distributors, and chemical and petrochemical companies, as well as water and
wastewater, iron and steel, semiconductor, minerals and mining, and pulp and
paper companies. In 1998, customers in the oil and gas industries accounted for
approximately 67% of the Company's total revenues, with such revenues derived
from both the production and the refining and petrochemical sectors of the
industry. Demand for the Company's products and services within the oil and gas
industry is dependent upon the level of capital spending by oil and gas
companies for production and distribution. This in turn is affected by current
and anticipated oil and gas prices; the discovery rate of new oil and gas
reserves; political, regulatory, and economic conditions; and the ability of oil
and gas companies to obtain capital. Energy prices declined precipitously in
1998. The resulting decrease in oil and gas activities adversely affected the
Company's results in 1998 and the first six months of 1999, and is expected to
continue to have a material adverse effect on the Company's near-term results of
operations.

      Sales originating outside of the United States and export revenues from
the United States accounted for approximately 17% and 27%, respectively, of
total revenues in 1998. Export sales in 1998 were made primarily to the United
Kingdom, Mexico, and the Middle East. During 1998, exports from the Company's
U.S. and foreign operations to Asia were approximately 5% of total revenues.
Asia is experiencing a severe economic crisis, which has been characterized by
sharply reduced economic activity and liquidity, highly volatile
foreign-currency-exchange and interest rates, and unstable stock markets.
Although the Company's export sales to Asia were not materially affected in 1998
or the first six months of 1999, future sales could be adversely affected by the
unstable economic conditions there. Although the Company seeks to charge its
customers in the same currency as its operating costs, the Company's financial
performance and competitive position can be affected by currency exchange rate
fluctuations affecting the relationship between the U.S. dollar and foreign
currencies.

Results of Operations

Second Quarter 1999 Compared With Second Quarter 1998

      Revenues decreased to $34.7 million in the second quarter of 1999 from
$38.4 million in the second quarter of 1998. Revenues from the Measurement
Instruments segment decreased $3.3 million to $23.6 million in 1999 from $26.9
million in 1998, primarily due to the effect of companies in the process control
industry reducing discretionary capital spending due to difficult market
conditions. In particular, market conditions in the petrochemical, oil and gas,
and mining sectors resulted in lower revenues. Revenues in the Industry-specific
Systems segment decreased to $11.1 million in 1999 from $11.5 million in 1998,
primarily due to the difficult market conditions in the oil and gas sector. The
decrease was offset in part by the inclusion of $3.3 million in revenues from
the Mid-South Companies, acquired in July 1998.

                                       10
<PAGE>


Second Quarter 1999 Compared With Second Quarter 1998 (continued)

      The gross profit margin decreased to 37% in the second quarter of 1999
from 43% in the second quarter of 1998, primarily due to the inclusion of
lower-margin revenues at the Mid-South Companies in the Industry-specific
Systems segment.

      Selling, general, and administrative expenses as a percentage of revenues
increased to 27% in the second quarter of 1999 from 25% in the second quarter of
1998, primarily due to decreased revenues. Selling, general, and administrative
expenses were $9.3 million in 1999, compared with $9.5 million in 1998. A
decrease in selling, general, and administrative expenses in the Measurement
Instruments segment as a result of restructuring actions commenced in 1998 were
offset in part by the inclusion of selling, general, and administrative expenses
at the Mid-South Companies.

      Research and development expenses remained unchanged at $2.4 million in
the second quarter of 1999 and 1998.

      The Company recorded $0.3 million of net restructuring costs in the second
quarter of 1999 (Note 6).

      Interest income decreased to $0.4 million in the second quarter of 1999
from $0.7 million in the second quarter of 1998, primarily due to a reduction in
invested balances as a result of the acquisition of the Mid-South Companies in
July 1998. Interest expense increased in 1999, primarily due to increased
borrowings by one of the Company's foreign subsidiaries.

      The effective tax rate was 39% in the second quarter of 1999 and 1998. The
effective tax rates exceeded the statutory federal income tax rate primarily due
to the impact of state income taxes and nondeductible amortization of cost in
excess of net assets of acquired companies.

First Six Months 1999 Compared With First Six Months 1998

      Revenues decreased to $68.7 million in the first six months of 1999 from
$75.6 million in the first six months of 1998. Revenues from the Measurement
Instruments segment decreased $10.4 million to $45.2 million in 1999 from $55.6
million in 1998, primarily due to the effect of companies in the process control
industry reducing discretionary capital spending due to difficult market
conditions. In particular, market conditions in the petrochemical, oil and gas,
and mining sectors resulted in lower revenues, primarily in the Company's level
and density business. Revenues in the Industry-specific Systems segment
increased $3.6 million to $23.6 million in 1999 from $20.0 million in 1998,
primarily due to the inclusion of revenues of $6.4 million from the Mid-South
Companies, acquired in July 1998. The increase was offset in part by reduced
discretionary spending in the oil and gas sector.

      The gross profit margin decreased to 36% in the first six months of 1999
from 42% in the first six months of 1998, primarily due to the reason discussed
in the results of operations for the second quarter.

      Selling, general, and administrative expenses as a percentage of revenues
remained relatively unchanged at 25.7% in the first six months of 1999, compared
with 25.4% in the first six months of 1998. Selling, general, and administrative
expenses decreased to $17.7 million in 1999 from $19.2 million in 1998,
primarily in the Measurement Instruments segment as a result of restructuring
actions commenced in 1998. The decrease was offset in part by the inclusion of
selling, general, and administrative expenses at the Mid-South Companies.

      Research and development expenses remained unchanged at $4.6 million in
the first six months of 1999 and 1998.

      The Company recorded $0.3 million of net restructuring costs in the first
six months of 1999 (Note 6).

                                       11
<PAGE>

First Six Months 1999 Compared With First Six Months 1998  (continued)

      Interest income decreased to $0.8 million in the first six months of 1999
from $1.0 million in the first six months of 1998, due to a reduction in
invested balances as a result of the acquisition of the Mid-South Companies in
July 1998. Interest expense decreased in 1999, primarily due to the repayment of
indebtedness in April 1998 related to the acquisition of the Peek Measurement
Business.

      The effective tax rate was 39% in the first six months of 1999, compared
with 40% in the first six months of 1998. The effective tax rates exceeded the
statutory federal income tax rate primarily due to the impact of state income
taxes and nondeductible amortization of cost in excess of net assets of acquired
companies.

Liquidity and Capital Resources

      Consolidated working capital was $76.3 million as of July 3, 1999,
compared with $74.8 million as of January 2, 1999. Included in working capital
are cash and cash equivalents of $7.0 million as of July 3, 1999, compared with
$33.4 million as of January 2, 1999. In addition, as of July 3, 1999, the
Company had $28.9 million invested in an advance to affiliate. Prior to the use
of a new domestic cash management arrangement between the Company and Thermo
Electron Corporation (Note 7), which became effective June 1, 1999, amounts
invested with Thermo Electron were included in cash and cash equivalents.

      During the first six months of 1999, the Company's operating activities
provided $1.6 million of cash. Cash of $3.1 million was used to fund an increase
in accounts receivable, primarily due to delays in the pursuit of collections of
accounts receivable at certain of the Company's subsidiaries. The Company
expects to address this matter over the remainder of 1999. A decrease in
inventories provided $3.2 million of cash, primarily resulting from management
efforts to decrease inventories as a result of lower revenues. Cash of $4.7
million was used to fund a decrease in other current liabilities, consisting
primarily of a $4.2 million decrease in deferred revenue due to the
Industry-specific Systems segment's shipments of products for which advance
payments had been received in the fourth quarter of 1998.

      During the first six months of 1999, the Company's primary investing
activities, excluding advance to affiliate activity (Note 7), included the
purchase of property, plant, and equipment. The Company used $2.2 million of
cash for purchases of property, plant, and equipment. During the remainder of
1999, the Company plans to make capital expenditures of approximately $1.5
million.

      The Company's financing activities provided $3.2 million of cash during
the first six months of 1999, due to an increase in short-term borrowings.

      Although the Company generally expects to have positive cash flow from its
existing operations, the Company anticipates it will require significant amounts
of cash for the possible acquisition of complementary businesses and
technologies. The Company expects that it will finance these acquisitions
through a combination of internal funds and/or short-term borrowings from Thermo
Instrument Systems Inc. or Thermo Electron, although there is no agreement with
these companies to ensure that funds will be available on acceptable terms or at
all. The Company believes that its existing resources are sufficient to meet the
capital requirements of its existing businesses for the foreseeable future.

Year 2000

      The following information constitutes a "Year 2000 Readiness Disclosure"
under the Year 2000 Information and Readiness Disclosure Act. The Company
continues to assess the potential impact of the year 2000 date recognition issue
on the Company's internal business systems, products, and operations. The
Company's year 2000 initiatives include (i) testing and upgrading significant
information technology systems and facilities; (ii) testing and developing
upgrades, if necessary, for the Company's current products and certain
discontinued products; (iii) assessing the year 2000 readiness of its key
suppliers and vendors; and (iv) developing a contingency plan.


                                       12
<PAGE>

Year 2000 (continued)

The Company's State of Readiness

      The Company has implemented a compliance program to ensure that its
critical information technology systems and non-information technology systems
will be ready for the year 2000. The first phase of the program, testing and
evaluating the Company's critical information technology systems and
non-information technology systems for year 2000 compliance, has largely been
completed. During phase one, the Company tested and evaluated its significant
computer systems, software applications, and related equipment for year 2000
compliance. The Company also evaluated the potential year 2000 impact on its
critical non-information technology systems, which efforts included testing the
year 2000 readiness of its manufacturing, utility, and telecommunications
systems at its critical facilities. The Company is currently in phase two of its
program, during which any material non-compliant systems or non-information
technology systems that were identified during phase one are prioritized and
remediated. Based on its evaluations of its critical non-information technology
systems, the Company does not believe any material upgrades or modifications are
required. The Company is currently upgrading or replacing its material
non-compliant information technology systems, and this process was approximately
80% complete as of July 3, 1999. In many cases, such upgrades or replacements
are being made in the ordinary course of business, without accelerating
previously scheduled upgrades or replacements. The Company expects that all of
its material information technology systems and critical non-information
technology systems will be year 2000 compliant by September 1999.

      The Company has also implemented a compliance program to test and evaluate
the year 2000 readiness of the material products that it currently manufactures
and sells. The Company believes that all of such material products are year 2000
compliant. However, as many of the Company's products are complex, interact with
or incorporate third- party products, and operate on computer systems that are
not under the Company's control, there can be no assurance that the Company has
identified all of the year 2000 problems with its current products. The Company
believes that certain of its older products, which it no longer manufactures or
sells, may not be year 2000 compliant. The Company is continuing to test and
evaluate such products. The Company is focusing its efforts on products that are
still under warranty and/or are early in their expected life. The Company is
offering upgrades and/or identifying potential solutions where reasonably
practicable.

      The Company is in the process of identifying and assessing the year 2000
readiness of key suppliers and vendors that are believed to be significant to
the Company's business operations. As part of this effort, the Company has
developed and is distributing questionnaires relating to year 2000 compliance to
its significant suppliers and vendors. To date, no significant supplier or
vendor has indicated that it believes its business operations will be materially
disrupted by the year 2000 issue. The Company is now following-up with its
significant suppliers and vendors that have not responded to the Company's
questionnaires. The Company has not completed its assessment of third-party
risk, but expects to be substantially completed by September 1999.

Contingency Plan

      The Company is developing a contingency plan that will allow its primary
business operations to continue despite disruptions due to year 2000 problems.
This plan may include identifying and securing other suppliers, increasing
inventories, and modifying production facilities and schedules. As the Company
continues to evaluate the year 2000 readiness of its business systems and
facilities, products, and significant suppliers and vendors, it will modify and
adjust its contingency plan as may be required. The Company expects to complete
its contingency plan by September 1999.


                                       13
<PAGE>

Year 2000 (continued)

Estimated Costs to Address the Company's Year 2000 Issues

      To date, costs incurred in connection with the year 2000 issue have not
been material. The Company does not expect total year 2000 remediation costs to
be material, but there can be no assurance that the Company will not encounter
unexpected costs or delays in achieving year 2000 compliance. Year 2000 costs
are funded from working capital. All internal costs and related external costs,
other than capital additions, related to year 2000 remediation have been and
will continue to be expensed as incurred. The Company does not track internal
costs incurred for its year 2000 compliance project. Such costs are principally
the related payroll costs for its information systems group.

Reasonably Likely Worst Case Scenario

      At this point in time, the Company is not able to determine the most
reasonably likely worst case scenario to result from the year 2000 issue. One
possible worst case scenario would be that certain of the Company's material
suppliers or vendors experience business disruptions due to the year 2000 issue
and are unable to provide materials and services to the Company on time. The
Company's operations could be delayed or temporarily shut down, and it could be
unable to meet its obligations to customers in a timely fashion. The Company's
business, operations, and financial condition could be adversely affected in
amounts that cannot be reasonably estimated at this time. If the Company
believes that any of its key suppliers or vendors may not be year 2000
compliant, it will seek to identify and secure other suppliers or vendors as
part of its contingency plan.

Risks of the Company's Year 2000 Issues

      While the Company is attempting to minimize any negative consequences
arising from the year 2000 issue, there can be no assurance that year 2000
problems will not have a material adverse impact on the Company's business,
operations, or financial condition. While the Company expects that upgrades to
its internal business systems will be completed in a timely fashion, there can
be no assurance that the Company will not encounter unexpected costs or delays.
Despite its efforts to ensure that its material current products are year 2000
compliant, the Company may see an increase in warranty and other claims,
especially those related to Company products that incorporate, or operate using,
third-party software or hardware. In addition, certain of the Company's older
products, which it no longer manufactures or sells, may not be year 2000
compliant, which may expose the Company to claims. As discussed above, if any of
the Company's material suppliers or vendors experience business disruptions due
to year 2000 issues, the Company might also be materially adversely affected. If
any countries in which the Company operates experience significant year 2000
disruption, the Company could also be materially adversely impacted. There is
expected to be a significant amount of litigation relating to the year 2000
issue and there can be no assurance that the Company will not incur material
costs in defending or bringing lawsuits. In addition, if any year 2000 issues
are identified, there can be no assurance that the Company will be able to
retain qualified personnel to remedy such issues. Any unexpected costs or delays
arising from the year 2000 issue could have a material adverse impact on the
Company's business, operations, and financial condition in amounts that cannot
be reasonably estimated at this time.

Item 3 - Quantitative and Qualitative Disclosure About Market Risk

      The Company's exposure to market risk from changes in foreign currency
exchange rates has not changed materially from its exposure at year-end 1998.


                                       14
<PAGE>

PART II - OTHER INFORMATION

Item 2 - Changes in Securities and Use of Proceeds

(d)   Use of Proceeds

      The Company sold 3,300,000 shares of common stock, par value $.01 per
share, pursuant to a Registration Statement on Form S-1 (File No. 333-45333),
which was declared effective by the Securities and Exchange Commission on March
24, 1998. The managing underwriters of the offering were Donaldson, Lufkin &
Jenrette Securities Corporation, Lazard Freres & Co. LLC, and Gruntal & Co.,
L.L.C. The aggregate gross proceeds of the offering were $47,850,000. The
Company's total expenses in connection with the offering were $4,166,000, of
which $3,349,500 was for underwriting discounts and commissions; $699,500 was
for other expenses paid to persons other than directors or officers of the
Company, persons owning more than 10 percent of any class of equity securities
of the Company, or affiliates of the Company (collectively, Affiliates); and
$117,000 was paid to Thermo Electron Corporation, the Company's ultimate parent
company, for certain corporate services rendered in connection with the
offering. The Company's net proceeds from the offering were $43,684,000. On
April 10, 1998, $12,000,000 of such net proceeds was expended to repay the
outstanding indebtedness owed to Thermo Instrument Systems Inc. in connection
with the acquisition of the Peek Measurement Business. On July 7, 1998,
$12,509,000 of such net proceeds was expended to acquire the capital stock of
certain businesses of the Mid-South Companies. As of July 3, 1999, the Company
had also expended $3,293,000 of such net proceeds for the purchase of property,
plant, and equipment; $11,662,000 for research and development; and $4,220,000
for working capital needs. As of July 3, 1999, the Company had expended all of
the net proceeds.

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

     On May 27, 1999, at the Annual Meeting of  Shareholders,  the  shareholders
elected five incumbent directors to a one-year term expiring in 2000. The
directors elected at the meeting were: Mr. David J. Beaubien, Mr. Frank Jungers,
Mr. Earl R. Lewis, Mr. Arvin H. Smith, and Dr. William J. Zolner III. Each
director received 13,429,443 shares voted in favor of his election and 7,028
shares voted against. No abstentions or broker nonvotes were recorded on the
election of directors.

Item 6 - Exhibits and Reports on Form 8-K

(a)   Exhibits

      See Exhibit Index on the page immediately preceding exhibits.

(b)   Reports on Form 8-K

      None.

                                       15
<PAGE>

                                   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 as of the 11th day of August 1999.

                                                          ONIX SYSTEMS INC.



                                                          /s/ Paul F. Kelleher
                                                          Paul F. Kelleher
                                                          Chief Accounting Officer



                                                          /s/ Theo Melas-Kyriazi
                                                          Theo Melas-Kyriazi
                                                          Chief Financial Officer

                                       16
<PAGE>

                                  EXHIBIT INDEX


Exhibit
Number         Description of Exhibit

10.1           Master Cash Management, Guarantee Reimbursement and Loan Agreement dated
               as of June 1, 1999, between the Registrant and Thermo Electron
               Corporation.

10.2           Amended and Restated Equity Incentive Plan of the Registrant.

10.3           Amended and Restated Deferred Compensation Plan for Directors of
               the Registrant.

27             Financial Data Schedule.
</TABLE>