<PAGE>





                          SECURITIES AND EXCHANGE COMMISSION
                               Washington, D.C.  20549
            --------------------------------------------------------------

                                      FORM 10-K                            

          [MARK ONE]
          [X]  Annual  Report  Pursuant  to  Section 13  or  15(d)  of  the
               Securities Exchange Act of 1934

                     For the fiscal year ended December 31, 1996

                                          OR

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

               For the transition period from __________ to __________.

                             Commission File No. 1-10489
            --------------------------------------------------------------

                                    KIMMINS CORP.
            --------------------------------------------------------------
                (Exact name of registrant as specified in its charter)

                    Delaware                      59-2763096
            -------------------------------------------------------------
            (State of Incorporation) (I.R.S. Employer Identification No.)

                    1501 Second Avenue, East, Tampa, Florida 33605
            -------------------------------------------------------------
                 (Address of registrant s principal executive offices,
                                 including zip code)

                                               Name of Exchange
               Title of Each Class            on Which Registered         
            -------------------------------------------------------------
                 Common Stock,                     New York 
                 $.001 par value                Stock Exchange

             Securities registered pursuant to Section 12(g) of the Act:

                                         NONE

               Indicate by  a 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 [  ]<PAGE>





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

               As  of  April 14,  1997,  there  were outstanding  4,447,397
          shares of Common  Stock and  2,291,569 shares of  Class B  common
          stock. The aggregate  market value  of the voting  stock held  by
          non-affiliates  of  the  registrant as  of  April  14,  1997, was
          $7,774,000.
            --------------------------------------------------------------

                         DOCUMENTS INCORPORATED BY REFERENCE:

                                         NONE<PAGE>





               Documents  incorporated  by   reference:  Certain   exhibits
          provided  in  Part  IV are  incorporated  by  reference  from the
          Company s Registration Statement on Form S-3 (File No. 33-54640).

               Note:  The discussions  in  this Form  10-K contain  forward
          looking  statements that  involve risks  and uncertainties.   The
          actual  results  of  Kimmins  Corp., and  its  subsidiaries  (the
          "Company")  could  differ  significantly  from  those  set  forth
          herein.    Factors  that  could  cause  or   contribute  to  such
          differences include,  but are not limited to,  those discussed in
          "Business" and "Management s Discussion and Analysis of Financial
          Condition and Results of Operations,"  as well as those discussed
          elsewhere in this Form  10-K.  Statements contained in  this Form
          10-K that are not historical facts are forward looking statements
          that  are subject  to  the safe  harbor  created by  the  Private
          Securities  Litigation Reform Act of 1995.  A number of important
          factors could  cause the  Company s actual  results for  1997 and
          beyond  to differ materially  from those expressed  or implied in
          any  forward looking  statements made  by, or  on behalf  of, the
          Company.  These factors include, without limitation, those listed
          in "Risk Factors" in the Company s Registration Statement on Form
          S-1 (File No. 33-12677).

                                        PART I
          Item 1.  Business

                                     THE COMPANY

               Kimmins  Corp.  and   its  subsidiaries  (collectively,  the
          "Company")  operates   two  business  segments:     solid   waste
          management  services and  specialty  contracting  services.   The
          Company  provides  solid waste  management  services through  its
          TransCor   Waste  Services,   Inc.,  subsidiary   to  commercial,
          industrial, residential, and municipal  customers in the state of
          Florida.  The Company  provides specialty contracting services in
          the  south and  northeast, including  infrastructure development;
          underground  construction; road  work; site  remediation services
          such as  excavation, removal  and disposal of  contaminated soil;
          facilities demolition and dismantling; and asbestos abatement.

               The Company's services are as follows:

               *  Solid  waste  management  services  -  Transfer,  resource
                  recovery,   transportation,  disposal   of   non-hazardous
                  waste,  and   demolition  of  residential  and  commercial
                  facilities.

               *  Specialty contracting services

                  * Environmental and utility  contracting -  Environmental
                    and   utility  contracting,   including  infrastructure
                    services such as sewer lines, water lines, and roads.<PAGE>





                  * Industrial  demolition,  dismantling,  and abatement  -
                    Dismantling  of  facilities  or   structures  including
                    offshore oil  platforms;  draining liquid  wastes  from
                    pipes and tanks;  asbestos removal, cleanup,  disposal,
                    and  reinsulation; removal  of above-  and below-ground
                    tanks; removal and disposal or sale of other equipment;
                    and sale of scrap materials.

                  * Hazardous   waste   services   -   On-site   treatment,
                    containment, and excavation and removal.

               The  Company's  services  may  be used  individually  or  in
          combination as required to meet the  specific needs of customers.
          The Company's business strategy  is to draw upon its  solid waste
          management and contracting experience to perform complex projects
          requiring  a  broad range  of  services.  Although  each  of  the
          Company's business lines can operate independently from the other
          related services, the Company  believes that integration of these
          services  gives  it  a  competitive advantage  by  relieving  the
          customer  of the  burden of  coordinating activities  of multiple
          contractors.

               During  its   initial  years  of   operation,  the   Company
          emphasized,  among  other  services  offered, a  broad  range  of
          contracting services. As the need for waste-related and specialty
          contracting services  has grown in response  to heightened public
          concern  and  government regulation,  the  Company  has used  its
          capabilities in facilities demolition  and dismantling and in the
          management   of   complex   construction   projects   to   become
          increasingly    involved   in   solid    waste   management   and
          project-oriented activities.

               The  Company's strategy  is to  continue  to focus  on solid
          waste management services, through  its TransCor Waste  Services,
          Inc.  subsidiary, and specialty  contracting projects for private
          and governmental customers. To  date, the Company's activities in
          solid waste  management have  consisted of opening  and operating
          resource recovery  and transfer  facilities in various  cities in
          Florida and bidding on  and obtaining industrial, commercial, and
          municipal solid waste management  contracts. The Company does not
          consider its business to be highly seasonable.

          SERVICES

          Solid Waste Management Services:

               The Company, through its majority-owned subsidiary, TransCor
          Waste  Services,   Inc.   ("TransCor"),  provides   solid   waste
          management services to  commercial, industrial, residential,  and
          municipal  customers.  In  connection  with  such  services,  the
          Company currently owns and operates  fully-permitted construction
          and demolition ("C&D") transfer  and recycling ("T&R") facilities
          in  four  of the  largest metropolitan  regions  in the  state of
          Florida.  The Company has also, pursuant to several municipal<PAGE>





          contracts,  commenced the  residential curbside  collection of  a
          variety of  already segregated  recyclable forms of  solid waste,
          including  such  materials  as  newspapers,  cardboard,  plastic,
          metals, and glass. In addition to its T&R operations, the Company
          collects  and disposes of all types  of non-hazardous solid waste
          for industrial and  commercial customers in its T&R  regions. The
          Company also provides residential garbage collection services for
          several  municipalities located  in  Pinellas  County, St.  Lucie
          County, Lee County and Hillsborough County, Florida. In addition,
          the Company provides demolition  and other related services with,
          and as  an economic  complement to,  its  solid waste  management
          services.

               The Company's permits allow it to segregate and recycle part
          of the C&D  debris and yard waste accepted at  its T&R facilities
          (thereby decreasing  the Company's landfill  disposal costs). The
          Company  has  the capability  to  haul  the non-recyclable  waste
          economically to  outlying rural  landfills  (where disposal  fees
          generally are much lower than those charged by urban  landfills).
          Consequently,  the Company  can  charge lower  rates  at its  T&R
          facilities than those  charged by landfill operators  in the same
          vicinities. In addition, disposal of debris  at the Company's T&R
          facilities  generally  requires less  time  and  results in  less
          damage  to waste collection vehicles than landfill disposal. As a
          result,  third-party waste hauling organizations, including those
          in competition  with the  Company's own collection  services, are
          provided strong  economic and  other incentives for  disposing of
          their C&D debris and yard waste at the Company's T&R facilities.

               The Company provides demolition services for commercial  and
          residential  customers. These  services  include  the razing  and
          dismantling   of  facilities  and  structures,  the  recovery  of
          demolished  material for reuse and recycling, and the disposal of
          non-recycled demolition debris.  The typical demolition  projects
          of  the Company  are single  and multistory  urban buildings  and
          small warehouses,  manufacturing  plants, and  other  facilities.
          Typically, the Company enters into separate demolition  contracts
          for each project,  which are usually for a term  of less than six
          months.

          Specialty Contracting:

          Infrastructure and Utility Contracting Services

               Prior  to  1988,  the  Company's  contracting  business  was
          directed   primarily  at  lower-margin  general  contracting  for
          industrial, commercial, institutional and governmental customers,
          including schools,  apartments and shopping centers. During 1988,
          the Company redirected its focus toward environmental and utility
          contracting, including infrastructure and  reconstructive service
          work.<PAGE>





               The  Company,  through its  subsidiary,  Kimmins Contracting
          Corp.,   continues   to   provide   comprehensive   non-hazardous
          contracting  services, including infrastructure  services such as
          water  and sewer  line  installation, replacement  and repair  to
          private  and governmental  customers  primarily in  the State  of
          Florida.   Related   infrastructure  development   includes  road
          installation,  repair and widening,  and installation, repair and
          enhancement of drainage and wastewater services.

          Industrial Demolition, Dismantling, and Abatement Services

               The  Company, through  its subsidiaries,  Kimmins Industrial
          Service   Corp.,   Kimmins    Abatement   Corp.,   and    Kimmins
          International, offers demolition and dismantling of facilities or
          structures;    asbestos    removal;   cleanup,    disposal,   and
          reinsulation; removal  of above- and  below-ground storage tanks;
          removal and  disposal or  sale of  industrial equipment;  and the
          sale of equipment and scrap materials.

               Demolition and  dismantling projects result from the closing
          or retooling of  facilities due to such  factors as technological
          obsolescence  of facilities, corporate mergers and consolidations
          of operations, and the  relocation of manufacturing operations to
          low-cost  labor   areas  or  areas  subject   to  less  stringent
          regulation, primarily  in foreign  countries.  In addition,  site
          remediation,   particularly   in   the  case   of   environmental
          contamination of  a site,  frequently requires the  demolition or
          dismantling of a contaminated facility. 

               Dismantling is the precise disassembly of a manufacturing or
          production  facility   on  a  piece-by-piece  basis   to  recover
          equipment as complete operating units that can be  reinstalled at
          another location. Dismantling enhances  the value of the facility
          above  scrap market  values.  The  Company  is  paid  a  fee  for
          dismantling services  and, usually, a  commission on the  sale of
          non-relocated equipment.

               Demolition usually requires wrecking  services for which the
          Company is  paid a fee by the  customer. In certain projects, the
          Company  may also  receive  additional revenue  from selling  the
          scrap  material. The  Company's services  in these  areas include
          dismantling  large structures (including  refineries, and utility
          plants); draining  liquid wastes  from pipes and  tanks; removing
          above-  and   below-ground  tanks;  cleaning   and  disposing  of
          contaminated equipment; and controlled demolition.

               Certain demolition  projects also involve  asbestos removal,
          cleanup and  disposal. The Company is  continuing to de-emphasize
          its asbestos  abatement services and generally  will only perform
          these services in conjunction with other environmental demolition
          activities.<PAGE>





          Hazardous Waste Services

               The  Company offers  a range  of services  for the  removal,
          treatment,  and  disposal of  hazardous  materials. The  services
          offered  include  on-site   treatment  methods,  construction  of
          containment   systems,  and   the  excavation   and   removal  of
          contaminated material. The Company has deemphasized its hazardous
          waste  services   and  will   only  perform  these   services  in
          conjunction with other environmental demolition activities.

               On-site  treatment.  On-site  remediation involves  treating
          hazardous materials at  a customer's site to  reduce or eliminate
          the need for off-  site transportation and disposal  of hazardous
          materials, thus decreasing the cost to and potential liability of
          the  customer. On-site  treatment,  which includes  a variety  of
          techniques,  eliminates  the substance  permanently,  reduces its
          toxicity or  volume, or stabilizes its  constituents for disposal
          on-site or off-site at a permitted disposal  facility.  Treatment
          and disposal  methods used  by the Company  include incineration,
          stabilization    and   fixation,    dechlorination,   filtration,
          dewatering,  air stripping and  carbon adsorption, precipitation,
          and bioremediation.

               Containment. Containment systems are constructed  to prevent
          the  migration  of   hazardous  materials  from  a  site  to  the
          surrounding  groundwater,  surface  water,  soil  or  air.  While
          containment can be a permanent remedial solution, it is also used
          as  an interim step followed by excavation and removal or on-site
          treatment. The Company installs  containment systems that include
          containment cells, surface caps, and slurry walls.

               Excavation and removal.  Excavation and removal  involve the
          excavation of  contaminated  materials for  containment,  on-site
          treatment  or   off-site  disposal.  When  off-site  disposal  is
          required,  the Company subcontracts  with licensed  third parties
          for the transportation of the material for  off-site disposal. As
          part  of  its  quality  control program,  the  Company  regularly
          samples  and  analyzes excavated  materials  to  verify that  the
          contaminants  are  consistent   with  those  identified   in  the
          remediation plan.

          SEGMENT INFORMATION

               See Note 18 of Notes to Consolidated Financial Statements of
          the Company for the years ended December 31, 1994, 1995, and 1996
          for the Company's financial segment information. <PAGE>





          PERFORMANCE BONDS

               The  Company  is  required  to  post  performance  bonds  in
          connection  with certain  asbestos abatement,  waste remediation,
          demolition,  and  construction  contracts.  For  the  year  ended
          December 31, 1996, most of the Company's revenue was derived from
          contracts  or   projects  that  required  the   Company  to  post
          performance  bonds. The  Company's current  bonding coverage  for
          non-environmental  projects  is  $30  million  for  an individual
          project  ($100  million  aggregate).  The  Company  has  obtained
          bonding coverage  in amounts up to $8.5 million for environmental
          projects. However, the  Company has  experienced difficulties  in
          prior  years in  obtaining  bonding  coverage  for  environmental
          projects  more  than  this  amount.  However, some  environmental
          projects either  do not require a bond or require a bond for less
          than the  complete  contract  price of  the  project  value.  The
          Company has obtained bonding  coverage for environmental projects
          more  than $8.5 million as  a result of  personal surety bonds or
          collateral  furnished by  Francis M.  Williams, President  of the
          Company. Mr.  Williams has no obligation to provide surety bonds,
          collateral or otherwise to assist  the Company in connection with
          bonding coverage.

               In  addition   to   performance  bond   requirements,   some
          jurisdictions  in   the  future   may  require  the   posting  of
          substantial  bonds or  require companies  engaged in  solid waste
          management  and  related  activities to  provide  other financial
          assurances  covering the  closure,  post-closure  monitoring  and
          corrective   activities  for   certain  solid   waste  management
          facilities.

          MARKETING

               The Company, through its majority-owned subsidiary, TransCor
          Waste  Services, Inc., generally  obtains solid  waste collection
          contracts  for its services or for the operation of certain solid
          waste management  facilities through the  process of  competitive
          bidding,   purchase  orders,   or  negotiations.   The  Company's
          marketing  efforts include  door-to-door sales,  monitoring trade
          journals  and other  industry  sources for  bid solicitations  by
          various  entities, including  government authorities  and related
          instrumentalities,  and  responding  to  such  bid solicitations,
          which may  include requests  for proposals ("RFPs")  and requests
          for  qualifications ("RFQs").  The  Company also  attempts to  be
          included on  lists of  qualified bidders frequently  contained in
          RFPs  and RFQs.  In response  to an  RFP  or RFQ,  the soliciting
          entity  requires a  written response  within a  specified period.
          Generally, in  the case of  an RFP,  a bidder submits  a proposal
          detailing its  qualifications, the  services to be  provided, and
          the cost of  the services  to the soliciting  entity; then,  such
          entity,  based  on its  evaluation  of  the proposals  submitted,
          awards the contract to the successful  bidder. In the case of  an
          RFQ, a  bidder submits a  response describing its  experience and
          qualifications, the soliciting entity then selects the bidder<PAGE>





          believed to be the most qualified, and then negotiates all of the
          terms  of the contract, including  the cost of  the services. The
          Company's  single largest  solid  waste  collection contract  was
          derived through competitive bidding, and the Company expects that
          future significant contracts will be obtained through competitive
          bidding.  The  Company  has   also  obtained  customers   through
          recommendations and referrals from existing customers.

               The   Company's   specialty  contracting   business  results
          primarily  from customers  for  whom the  Company has  previously
          provided services,  prior customer  references,  and from  direct
          marketing  efforts.  In  particular,  the  Company  believes  its
          national  reputation as  a  leading  demolition  and  dismantling
          contractor  has  contributed  significantly  to  its  ability  to
          attract specialty service business.

               The  Company's  specialty  contracting  subsidiaries  direct
          their marketing  activities through  regional  offices in  Tampa,
          Florida and Houston, Texas.   These offices are located  in areas
          with a  high concentration of industrial  facilities. The Company
          believes  that  accurate  bidding  is  crucial  in  securing  new
          contracting projects and completing  them profitably. The Company
          uses computerized bidding systems in conjunction with site visits
          to develop bids for  contracting projects. While bid price  is an
          important factor in  obtaining contracts, potential  clients also
          consider the reputation, experience, safety  record and financial
          strength of the bidders in awarding contracts.

          CUSTOMERS

               Customers for the Company's  solid waste management services
          include   local   and   regional   contractors,   municipalities,
          institutions, other third-party waste hauling  organizations, and
          local businesses. The primary private customers for the Company's
          specialty  contracting  services  are  Fortune  500  corporations
          engaged  in heavy  manufacturing,  such  as chemical,  petroleum,
          petrochemical,  paper,  and steel  companies  as  well as  public
          utilities and  federal, state and local government agencies.  For
          the years ended December  31, 1994, 1995 and 1996,  the Company s
          specialty contracting services  segment earned  gross revenue  of
          approximately $10,000, $3,953,000 and  $14,884,000, respectively,
          on contracts with the Florida Department of Transportation.

               For  the year  ended December  31, 1996,  47 percent  and 53
          percent,  respectively,  of  the  Company's  gross  revenue  were
          derived  from private  and governmental  customers, respectively.
          Government contracts, which  represent a  significant portion  of
          the Company s gross revenue, are subject to legislation mandating
          a balanced  budget; delays  in funding; lengthy  review processes
          for awarding contracts; delay or termination of contracts  at the
          convenience   of  the   government;  termination,   reduction  or
          modification  of  contracts  in  the  event  of  changes  in  the
          government's  policies  or   because  of  budgetary  constraints.
          Furthermore, increased or unexpected costs could result in losses<PAGE>





          or  reduced  profits  under  fixed-price government  as  well  as
          commercial contracts.

          BACKLOG

               As  of December  31,  1996, the  Company  had a  backlog  of
          uncompleted  projects  under  contract aggregating  approximately
          $137,372,000,  (compared  to   approximately  $95,661,000  as  of
          December  31,   1995)  of  which   approximately  $68,562,000  is
          attributable to environmental  and utility contracting  services,
          approximately  $4,347,000  is   attributable  to  demolition  and
          dismantling  services, approximately  $91,000 is  attributable to
          asbestos   abatement   services,   approximately  $1,433,000   is
          attributable  to  site  remediation services,  and  approximately
          $62,940,000 is  attributable to solid waste  management services.
          The  Company anticipates  that  it will  recognize  approximately
          $72,000,000  of revenues from these  projects by the  end of 1997
          with the  remaining  revenue to  be recognized  through the  year
          2004.

          COMPETITION

               Although developments in the solid waste management industry
          have  resulted in the emergence of large private and public solid
          waste  management companies  and in  consolidating trends  in the
          industry, the solid waste management business is characterized by
          intense competition. The Company  believes that no single company
          has  a  dominant  market  share  of  the  solid  waste management
          business in the United  States or Florida.  Although  competition
          varies by locality and type  of services, the Company's principal
          sources  of  competition  are  local  and  regional  solid  waste
          management companies  of  varying  size  that  primarily  provide
          collection  or  disposal  services  to  customers  in  a  limited
          geographic  area,  large  regional   and  national  solid   waste
          management companies that operate over more  extensive geographic
          areas and  provide completely  integrated solid  waste management
          services,  own or  operate disposal sites  and engage  in various
          transfer  and  resource  recovery activities,  and  counties  and
          municipalities that maintain their own solid waste collection and
          disposal services  for residents and businesses  in the locality.
          National  companies  that  compete against  the  Company include,
          among   others,  Waste  Management,   Inc.,  and  Browning-Ferris
          Industries, Inc.

               The Company believes that  the principal competitive factors
          in  the solid  waste management  industry are  price, reputation,
          services, managerial experience,  financial assurance  capability
          (particularly as it relates to municipal contracts), and range of
          services offered.<PAGE>





               The Company believes that its ability to offer a broad range
          of specialty  contracting services provides  it with  significant
          competitive   advantage.   Nevertheless,   the    Company   faces
          substantial  competition  from   national,  regional  and   local
          competitors, many  of which are  well established  and have  much
          greater  marketing, financial, technological  and other resources
          than the Company. 

               The Company  believes the principal  competitive factors  in
          the   specialty   contracting  services   industry   are  safety,
          reputation,  technical  proficiency,  surety bonding  capability,
          managerial experience, price, and breadth of services offered.

          INSURANCE COVERAGE

               The  Company  currently   maintains  comprehensive   general
          liability insurance, with  total coverage of $16  million for any
          single occurrence  and $18 million for  aggregate claims relating
          to  damage to  persons  or  property.  These policies  cover  all
          activities  of the  Company and  its subsidiaries except  for its
          asbestos-related  activities  and  certain  non-asbestos  related
          liabilities  such  as  pollution   liability  damage  (sudden  or
          gradual)  caused by the discharge  or release of  any irritant or
          contaminant. In  addition, the Company has  comprehensive general
          liability  coverage  that covers,  among  other things,  specific
          asbestos-  related risks  up  to $10  million.  In addition,  the
          Company  has  obtained a  $1  million  per occurrence/$2  million
          aggregate  blanket policy  for contractors  pollution liabilities
          and can obtain additional coverage of up to a total of $6 million
          as required on a project-by-project basis.

          GOVERNMENT REGULATION

               The  Company  is  subject  to an  extensive  and  frequently
          evolving  statutory and regulatory  framework of  federal, state,
          and  local  environmental,  health,  safety,  and  transportation
          authorities,  which  framework  imposes   significant  compliance
          burdens and risks upon the Company. The Company believes it is in
          substantial  compliance  with all  material  federal, state,  and
          local   laws  governing   its   material   business   operations.
          Nevertheless,  amendments to  existing statutes  and regulations,
          adoption  of  new  statutes  and regulations  and  the  Company's
          expansion into other jurisdictions  and types of operations could
          result not only in the additional risk of noncompliance, but also
          in  the increase in  regulatory burden  that could  cause related
          increases in costs and expenses.

               Two  of the statutes very  important to the  Company are the
          Resource Conservation and Recovery  Act of 1976, as  amended, and
          the EPA's implementing regulations of that statute (collectively,
          "RCRA"),   and   the   Comprehensive    Environmental   Response,
          Compensation and  Liability Act  of 1980, as  amended ("CERCLA").
          RCRA establishes a comprehensive  framework for state and federal
          regulation of hazardous waste management. It seeks to prevent the<PAGE>





          release  into the  environment  of hazardous  wastes through  the
          development of solid waste management plans and the regulation of
          the  generation, transportation, treatment,  storage and disposal
          of hazardous wastes.   On  October 9, 1991,  the EPA  promulgated
          substantial   revisions   to  its   existing   RCRA   Subtitle  D
          implementing   regulations.  The  revisions   set  forth  minimum
          national "open  dump" criteria  for publicly and  privately owned
          municipal   solid   waste   landfills.  They   include   location
          restrictions,   design   and   operating  criteria,   groundwater
          monitoring  and corrective  action  standards,  closure and  post
          closure  care requirements,  and  financial assistance  criteria.
          Most revisions became effective October  9, 1993, and states have
          revised  their own laws and regulations to be consistent with the
          RCRA  criteria.  Some  revisions  (i.e.,  groundwater  monitoring
          requirements)  have been phased  in over a  five-year period that
          began on  October  9,  1991, and  others  relating  to  financial
          responsibility became effective April 9, 1994.

               While  RCRA  was  implemented  to  prevent  the  release  of
          hazardous  wastes into  the environment,  CERCLA was  designed to
          establish  a  national  strategy  to  remedy  existing  hazardous
          environmental  conditions. CERCLA establishes liability for clean
          up costs  and environmental damages  for owners and  operators of
          disposal sites, as well as for persons who generate, transport or
          arrange for transportation  of wastes to a particular site. While
          CERCLA generally  exempts responsible contractors  from liability
          arising from  the  release or  threatened  release to  which  the
          contractor  is   responding,  it   can  impose  liability   on  a
          responsible  contractor  for   that  contractor's  negligent  and
          grossly negligent acts.

               Many states have enacted statutes similar to RCRA and CERCLA
          regulating the  handling of hazardous substances  and wastes. The
          Company  could be  subject to  substantial liability  under these
          statutes to private parties and  government entities for fines or
          penalties, in some instances without any fault on the part of the
          Company, because  of the mishandling or release  of any hazardous
          substances.

          PERMITS AND LICENSES

               Many states  license such areas of  the Company's operations
          as asbestos abatement and general contracting. Licensing requires
          that workers  and supervisors receive training  from EPA approved
          and state  certified organizations  and pass required  tests. The
          Company  is  currently licensed  to  perform its  services  in 36
          states. The Company also  operates in certain states that  do not
          have a special asbestos  abatement or general contracting license
          requirement;  however,  these  states  have  adopted  regulations
          regarding worker safety with which the Company must comply.<PAGE>





               The  Company  may need  additional  licenses  to expand  its
          operations. Although  there can be  no assurance, based  upon the
          level  of  training of  its  employees  and its  experience,  the
          Company currently believes that  it can obtain all  such required
          licenses.

          EMPLOYEES

               The Company has approximately 975 employees, of which 8 were
          employed in executive capacities,  45 in professional capacities,
          63 in administrative capacities, 109 as field supervisors and 750
          in field operations. A total of 8 of the Company's employees  are
          union   members,   covered  by   various   collective  bargaining
          agreements.  The Company has not experienced  any strikes or work
          stoppages and considers its relationship with its employees to be
          satisfactory.

               The  Company,  through  its  subsidiaries,  has  implemented
          employee safety programs that require each employee to complete a
          general  training  and  safety program.  Training  topics include
          approved work  procedures and instruction on  personal safety and
          the  use  of protective  equipment.  In  addition, all  employees
          engaged in asbestos abatement activities are required to attend a
          minimum  three-day to  four-day course  approved  by the  EPA and
          Occupational   Safety  and   Health   Administration,   and   all
          supervisors  of  abatement  projects  are required  to  attend  a
          40-hour safety  course annually.  Moreover, employees are  issued
          detailed training  materials and  are required to  attend ongoing
          safety  seminars. The  Company's  subsidiaries  also conduct  job
          safety analysis in the job bidding stage. Besides the precautions
          taken  with respect  to  projects, the  Company takes  additional
          measures to  protect its  asbestos and site  remediation workers,
          including providing them with additional protective equipment and
          sponsoring periodic medical examinations.

          Item 2.  Properties

               The Company  owns its  principal executive offices  that are
          located in  approximately 20,600 square  feet of office  space at
          1501  and  1502 Second  Avenue, East,  Tampa, Florida  33605. The
          offices  are  subject  to   a  mortgage,  securing   indebtedness
          evidenced  by a  promissory  note with  an outstanding  principal
          amount at December  31, 1996, of  $1,775,000. This variable  rate
          note matures on August  1, 1999, and currently bears  interest at
          1.25 percent above the lender's prime rate.

               The Company leases the following office:
                                                               Annual
                       Location         Lease Expiration Date  Rental
                ----------------------  ---------------------  ------
                2609 Allen-Genoa Road   
                Pasadena, Texas             Month-to-month     $3,240<PAGE>





          Item 3.  Legal Proceedings

               The Company is involved in  various legal actions and claims
          arising in the ordinary course of  its business, none of which is
          expected to  have a material  effect on  the Company's  financial
          position or results of operations.

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

               None.

                                       PART II


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

               The Company's common stock  has been traded on the  New York
          Stock  Exchange  (symbol  "KVN")  since  March  30,  1990.    The
          following table sets forth for the periods indicated high and low
          sales prices of the Company's common stock as reported by the New
          York Stock Exchange.  The 1995  stock prices give  effect to  the
          one-for-three reverse  stock split that  became effective January
          11, 1996.

                              1996               High       Low   
                   --------------------------- --------- ---------
                   First Quarter . . . . . . . $   7.875 $   5.250
                   Second Quarter  . . . . . . $   5.750 $   4.875
                   Third Quarter . . . . . . . $   5.000 $   3.500
                   Fourth Quarter  . . . . . . $   4.125 $   3.250
                                               
                              1995               High       Low   
                   --------------------------- --------- ---------
                   First Quarter . . . . . . . $   6.000 $   4.500
                   Second Quarter  . . . . . . $   7.875 $   5.250
                   Third Quarter . . . . . . . $  18.750 $   7.125
                   Fourth Quarter  . . . . . . $  10.125 $   6.375

               On April 7,  1997, there were  approximately 960 holders  of
          record of the  common stock. Many of such holders are brokers and
          other  institutions holding shares in "street name" for more than
          one beneficial owner.<PAGE>





          Dividends

               The  payment by  the Company  of dividends,  if any,  in the
          future is within  the discretion  of its Board  of Directors  and
          will  depend  upon the  Company's earnings,  capital requirements
          (including working  capital needs),  and financial condition,  as
          well as  other relevant  factors. Certain agreements  between the
          Company and  its lending  institutions prohibit the  Company from
          paying cash dividends without the lenders' consent.  Other than a
          three  and  one-third  cent per  share  of  a  common stock  cash
          dividend paid  in July 1989,  the Company has  not paid  any cash
          dividends since  its inception, and  the Board of  Directors does
          not plan to declare or pay any cash dividends in the future.

          Item 6.  Selected Financial Data

               The following  selected financial data are  derived from the
          consolidated  financial statements  of  Kimmins Corp.   The  data
          should  be read  in conjunction  with the  consolidated financial
          statements,  related  notes,   and  other  financial  information
          included herein.
          <TABLE>
          <CAPTION>
                                               Years ended December 31,
                                         (In thousands, except per share data)      
                                   -------------------------------------------------
                                     1992      1993      1994      1995       1996  
                                   --------- --------- --------- --------- ---------
          <S>                      <C>       <C>       <C>       <C>       <C>
          Gross revenue . . . . .  $ 87,442  $ 83,609  $ 96,755  $111,346  $113,241 
          Net revenue . . . . . .    78,614    77,405    85,353    95,426    97,977 
          Operating income                                       
           (loss) (1) . . . . . .     1,782     3,666     2,670     4,596   (7,806) 
          Litigation                                             
           settlements (2)  . . .      (379)      -         -         -         -   
          Income (loss) from                                     
           continuing operations                                 
           before provision                                      
           (benefit) for income
           taxes  . . . . . . . .        99     3,196     1,533     2,833   (10,775)
          Income (loss) from                                     
           continuing                                            
           operations . . . . . .        61     1,753       797     1,343    (8,683)
          Income from discontinued                               
           operations (3) . . . .       124       -         -         -         -   
          Net income (loss) (4) .       185     1,753       797     1,343    (8,683)
          </TABLE>                                               <PAGE>





          <TABLE>
          <CAPTION>
                                               Years ended December 31,
                                         (In thousands, except per share data)      
                                   -------------------------------------------------
                                     1992      1993      1994      1995       1996  
                                   --------- --------- --------- --------- ---------
          <S>                      <C>       <C>       <C>       <C>       <C>
          PER SHARE DATA:                                        
                                                                 
          Income (loss) from                                     
           continuing operations                                 
           per share -                                           
           primary  . . . . . . .  $  -      $    .39  $    .18  $    .30  $  (1.96)
          Income from discontinued                               
           operations per share -                                
           primary  . . . . . . .       .03     -         -         -         -     
          Net income (loss) per    --------- --------- --------- --------- ---------
           share - primary  . . .  $    .03  $    .39  $    .18  $    .30  $  (1.96)
          Income (loss) from       ========= ========= ========= ========= =========
           continuing operations                                 
           per share - fully                                     
           diluted  . . . . . . .  $  -      $    .39  $    .18  $    .30  $  (1.96)
          Income from discontinued                               
           operations per share -                                
           fully diluted  . . . .       .03     -         -          -        -     
          Net income (loss) per    --------- --------- --------- --------- ---------
           share - fully                                         
           diluted  . . . . . . .  $    .03  $    .39  $    .18  $    .30  $  (1.96)
          Weighted average number  ========= ========= ========= ========= =========
           of common shares                                       
           outstanding -                                         
           primary  . . . . . . .     4,442     4,443     4,443     4,544     4,420 
          Weighted average number                                
           of common shares                                      
           outstanding - fully                                   
           diluted  . . . . . . .     4,442     4,474     4,449     4,544     4,420 
          Cash dividends per                                     
           share  . . . . . . . .      None      None      None      None      None 
                                                       
          </TABLE>                                               

          (1)  The  1996 results  reflect charges  to operations  of $6,452
               during  the  fourth  quarter  related  to  contract estimate
               changes and contract claim and change order settlements.

          (2)  Balances  relate  to  the  settlement of  separate  contract
               claims for work performed in excess of the original contract
               amounts  due  to  changes  in  conditions.  Amounts  applied
               against the settlements included legal fees and other direct
               costs.

          (3)  Balances relate to the  Company s distribution of its surety
               services.<PAGE>





          (4)  The 1996  results included  a  benefit for  income taxes  of
               $2,092, which  is net  of a  valuation  allowance of  $1,707
               related to  the future recoverability of  deferred tax asset
               balances.

          HISTORICAL BALANCE SHEET DATA:
          <TABLE>
          <CAPTION>
                                                  As of December 31,
                                                    (In thousands)                  
                                   -------------------------------------------------
                                     1992      1993      1994      1995       1996  
                                   --------- --------- --------- --------- ---------
          <S>                      <C>       <C>       <C>       <C>       <C>
          Current assets  . . . .  $ 33,068  $ 33,716  $ 36,200  $ 44,117  $ 41,856 
          Working capital . . . .     8,253    12,041    11,205    11,548     5,587 
          Total assets  . . . . .    68,381    70,192    72,689    93,629    93,083 
          Long-term debt  . . . .    21,206    19,454    17,032    26,540    31,360 
          Stockholders equity . .    20,783    23,102    24,514    26,381    17,853 
          </TABLE>                                               

          Item 7.  Management's Discussion and Analysis of 
                   Financial Condition and Results of Operations

          Introduction

               The  Company conducts  its business  in two  segments: solid
          waste management services and specialty contracting services. The
          solid  waste  management   services  segment  offers  collection,
          transfer,  transportation,  resource  recovery  and  disposal  of
          non-hazardous waste.  The  specialty contracting services segment
          provides comprehensive services  including facilities  demolition
          and  dismantling, installation  of sewer  lines, water  lines and
          roads,  excavation, removal  and disposal  of  contaminated soil,
          groundwater treatment and asbestos abatement.<PAGE>





          Results of Operations

               The following table sets forth for the periods indicated (i)
          the percentage of net revenue represented by certain items in the
          financial  statements of  the  Company, and  (ii) the  percentage
          change in the dollar amount of such items from period to period.
          <TABLE>
          <CAPTION>
                                                                     Percentage
                                                                 Increase (Decrease)
                                     Percentage of Net Revenue       Year ended 
                                      Year Ended December 31,       December 31,
                                   ----------------------------- -------------------
                                                                 1995 vs.   1996 vs.
                                     1994      1995      1996      1994       1995  
                                   --------- --------- --------- --------- ---------
          <S>                      <C>       <C>       <C>       <C>       <C>
          Gross revenue . . . . .    113.4%    116.7%    115.5%     15.1%      1.7% 
          Outside services  . . .     13.4%     16.7%     15.5%     39.6%     (4.1%)
                                   --------- --------- ---------
          Net revenue . . . . . .    100.0%    100.0%    100.0%     11.8%      2.7% 
          Cost of revenue                                        
           earned   . . . . . . .     85.8%     81.2%     92.1%      5.8%     16.5% 
                                   --------- --------- ---------
          Gross profit  . . . . .     14.2%     18.8%      7.9%     48.2%    (57.1%)
          Selling, general and                                   
           administrative                                        
           expense  . . . . . . .     11.1%     14.0%     15.8%     41.5%     16.1% 
                                   --------- --------- ---------
          Operating income                                       
           (loss)   . . . . . . .      3.1%      4.8%     (7.9%)    72.1%   (269.8%)
          Minority interest in                                                      
           net (income) loss                                     
           of subsidiary  . . . .      0.0%     (0.3%)     0.1%    469.6%   (140.0%)
          Interest expense,                                      
           net  . . . . . . . . .     (1.3%)    (1.5%)    (3.2%)    31.7%    119.1% 
                                   --------- --------- ---------
          Income (loss) before                                   
           provision for income                                  
           taxes (benefit)  . . .      1.8%      3.0%    (11.0%)     84.8%  (480.3%)
          Provision for income                         
           taxes (benefit)  . . .      0.9%      1.6%     (2.1%)
                                   --------- --------- ---------
          Net income (loss) . . .      0.9%      1.4%     (8.9%)     68.5%  (746.8%)
                                   ========= ========= =========
          </TABLE>                                               <PAGE>





          Year Ended December 31, 1996, Compared to Year Ended December 31,
          1995

               The Company  incurred a net loss of  $8,683,000 for the year
          ended December 31, 1996, compared to net income of $1,343,000 for
          the year ended  December 31, 1995.   Approximately $8,295,000  of
          the 1996 loss was attributable to several matters related  to the
          Company s  specialty   contracting  segment,   and  approximately
          $388,000 of  the net  loss  (net of  the minority  interest)  was
          attributable to the solid waste management services segment.  The
          1996 net loss associated with the solid  waste management segment
          was primarily  attributable to a demolition contract  claim and a
          change order settlement which totaled $395,000.  As it relates to
          the  specialty   contracting   segment,  the   Company   incurred
          $2,903,000  of pre-tax  losses related  to the  settlement and/or
          resolution  of contract claims  and unapproved  change orders. In
          addition,  the   Company  incurred  losses  on   two  remediation
          contracts  located in the northeast  region that resulted in pre-
          tax losses of $1,369,000.  These losses were attributable  to the
          Company s de-emphasis of work located in  the northeastern states
          and focus towards operations located in  the southeastern states,
          primarily  Florida.  This  de-emphasis  resulted  in  operational
          inefficiencies, such as  work slow downs, that  were the ultimate
          causes of the losses.  As management focused on the resolution of
          the operating issues related to the northeast region, operational
          inefficiencies in the southeast region arose, resulting in a pre-
          tax  charge  of  $3,580,000  related  to  five  utility  and  two
          demolition and abatement projects.

               Certain of the above charges  occurred in the fourth quarter
          of  1996, resulting in  an aggregate pre-tax  loss of $6,452,000.
          Information  related to these  matters substantially arose during
          the fourth quarter  of the year.  As it  relates to the specialty
          contracting segment,  the Company incurred  $2,455,000 of pre-tax
          losses related to  the settlement and/or  resolution of  contract
          claims and unapproved change orders during the fourth  quarter of
          1996.   The losses  associated with the  remediation and  utility
          contracting contracts  that related  to  the fourth  quarter  was
          $1,543,000 and $2,454,000, respectively.

               Management  intends to continue  to emphasize obtaining work
          in the southeast.  The  Company anticipates that, with  increased
          and focused management  oversight, it will be able  to reduce the
          possibility  of  reoccurrence of  the conditions  leading  to the
          losses in  the southeast region  during 1996.  In  addition, only
          two contracts remain  in the northeast  region and are  scheduled
          for completion during 1997.<PAGE>





               A  line-by-line  analysis  of the  Company s  statements  of
          operations follows below:

               During  the  year  ended  December  31,  1996,  net  revenue
          increased  by  $2,551,000,  or  3  percent,  to $97,977,000  from
          $95,426,000 for the year ended December 31, 1995. The increase in
          revenue  associated  with the  Company's  solid  waste management
          services ($4,492,000 increase in net revenue) is primarily due to
          the commencement of two  municipal contracts during October  1995
          to  provide  residential  collection services.  The  increase  in
          revenue   associated  with  the   Company's  utility  contracting
          services  ($1,676,000  increase in  net  revenue) is  due  to the
          Company's  change in  focus  towards non-environmental  projects.
          The decrease in revenue associated with the Company's remediation
          services ($1,602,000 decrease in net revenue), asbestos abatement
          services ($1,243,000  decrease  in net  revenue), and  industrial
          demolition  services ($772,000 decrease in net revenue) is due to
          the  Company de-emphasizing  these  services and  only performing
          this work in conjunction  with the Company's other  environmental
          demolition activities.  The  impact  of price  increases  on  net
          revenue is less than one percent.

               Outside services, which  primarily consist of  subcontractor
          costs, decreased as a percentage  of net revenue from 17  percent
          during  the year ended  December 31,  1995, to 16  percent during
          1996. The Company will use  the services of a subcontractor  when
          it  determines  that  an  economic  opportunity  exists regarding
          internally  providing  the  services. The  Company  utilized  the
          services of  subcontractors to  a lower  extent during 1996  than
          1995  due  to  the  ongoing   contracts  and  the  specific  work
          requirements.

               Cost of revenue earned increased to $90,269,000 for the year
          ended  December  31, 1996,  from $77,466,000  for  the comparable
          period of 1995. As a  result, gross profit during the  year ended
          December  31, 1996,  decreased to  $7,708,000 (8  percent of  net
          revenue) from $17,960,000  (19 percent of  net revenue) in  1995.
          The decrease in the dollar  amount and percentage of gross profit
          primarily is associated  with the  Company's utility  contracting
          ($3,923,000 decrease  in gross profit) and remediation operations
          ($3,703,000  decrease  in gross  profit). The  decrease  in gross
          profit from utility contracting  services is directly related  to
          management s  decision  to  stop  legal  action  related  to  two
          unapproved change orders and to  a project that failed to perform
          to the  Company s original  projections.   The decrease  in gross
          profit from  remediation services is  directly related to  losses
          incurred on two projects that  failed to perform to the Company s
          original  projections and the settlement of a contract claim that
          resulted  in  a pre-tax  loss  of  approximately  $448,000.    In
          addition,  the   Company  incurred  certain   decreases  in   its
          industrial  demolition  services  ($1,380,000  decrease  in gross
          profit),  solid waste  management services ($848,000  decrease in
          gross profit), and asbestos abatement services ($398,000 decrease<PAGE>





          in gross profit).   The decrease in gross profit  associated with
          the Company s  industrial demolition services is due to a judge s
          reversal  of a previous jury award, resulting in a pre-tax charge
          to operations of $1,572,000.

               Included in  the Company s operating  results for the  years
          ended December 31,  1995 and 1996 is the  activity related to the
          settlement  and/or resolution  of contract claims  and unapproved
          change orders.  This activity can be summarized as follows:

                                                 Years ended December 31,  
                                                ---------------------------
                                                    1995          1996     
                                                ------------- -------------
                                                
          Claim recoveries  . . . . . . . . . . $  1,618,000  $  2,013,000 
                                                
          Cost of recoveries  . . . . . . . . .    1,145,000     4,916,000 
                                                ------------- -------------
          Gain (loss) on resolved claims  . . . $    473,000  $ (2,903,000)
                                                ============= =============

               In  addition,  the Company  incurred  costs  associated with
          unresolved claims of  $6,440,000 and  $2,079,000 during 1995  and
          1996, respectively.<PAGE>





               The Company had the  following balances recorded relating to
          contract claims and unsigned  change orders at December 31,  1995
          and 1996:

                                                       December 31,        
                                                ---------------------------
                                                    1995           1996    
                                                ------------- -------------
                                                
          Claims  . . . . . . . . . . . . . . . $  9,128,000  $  5,558,000 
          Unapproved change orders  . . . . . .    2,659,000     3,392,000 
                                                ------------- -------------
                                                $ 11,787,000  $  8,950,000 
                                                ============= =============
          Cumulative external claim             
           preparation costs included above . . $  1,226,000  $    295,000 
                                                ============= =============
                                                
               During  1996, selling,  general and  administrative expenses
          increased  to $15,515,000  from  $13,364,000 for  the year  ended
          December 31, 1995. The  dollar increase in selling,  general, and
          administrative  expenses primarily  is attributable  to increased
          overhead  costs, such  as  office salaries  and marketing  costs,
          associated  with  higher  levels  of  operations.  The percentage
          increase   in  selling,   general  and   administrative  expenses
          primarily  is associated with  the growth of  the Company's solid
          waste  management  operations, which  has  an  overhead structure
          equal  to 17  percent  of its  net revenue.  These  services have
          historically operated  with a higher overhead  structure than the
          Company's specialty contracting operations, which has an overhead
          structure equal to 15 percent of its net revenue.

               As a  result  of  the  foregoing, the  Company  incurred  an
          operating  loss of $7,806,000 (negative 8 percent of net revenue)
          during the year  ended December 31,  1996, compared to  operating
          income of $4,596,000 (5  percent of net revenue) during  the same
          period in 1995.

               Minority interest in net loss of the TransCor subsidiary was
          $138,000  for the  year  ended  December  31, 1996,  compared  to
          minority interest in  net income of  $345,000 for the  year ended
          December 31, 1995. The minority interest in net income or loss of
          such subsidiary  reflects approximately 26 percent  of TransCor's
          earnings  as  a result  of  the March  25,  1993,  initial public
          offering of  TransCor's common stock. The  decrease in TransCor's
          earnings between  years is  attributable  to the  profit  margins
          earned on certain solid waste management services.

               Interest  expense, net  of  interest  income,  increased  to
          $3,107,000 during the  year ended December 31, 1996,  compared to
          $1,418,000, for the  year ended December 31, 1995.   During 1996,
          the  Company  discontinued  recognition  of  interest  income  of
          approximately   $551,000  on   certain   notes  receivable   from
          affiliates. <PAGE>





          The  remainder of  the increase is  attributable to  increases in
          average borrowings during the year.

               During  1996,  the  Company  converted  a   $5,700,000  note
          receivable  from  Cumberland  into  a  common  stock  investment,
          representing a 30  percent interest in Cumberland.   The note was
          converted based upon current stock  market prices, which was less
          than the underlying equity in the book value of  Cumberland.  The
          amount  in  excess of  the  underlying equity  was  attributed to
          goodwill  and is  being amortized  over  20 years.   The  Company
          recorded equity in losses of Cumberland of approximately $37,000,
          which   represents   the   Company s   proportionate   share   of
          Cumberland s net  loss for the  period November 5,  1996, through
          December 31, 1996.

               The Company s effective tax rate was (19.5)  percent for the
          year ended  December 31,  1996, compared to  a tax  rate of  52.6
          percent for  the year ended December  31, 1995.   The decrease in
          the  effective tax  rate was primarily  due to  the net operating
          loss generated by  the Company and  the resulting recognition  of
          future tax benefits from credit and loss carryforwards.   The net
          operating loss ("NOL")  generated in the year ended  December 31,
          1996,  was approximately  $11,200,000.   Approximately $4,500,000
          will  be   carried  back  to   prior  tax  years,   resulting  in
          approximately $900,000 of federal tax refunds.  The remaining NOL
          of approximately $6,700,000 will be carried forward to offset any
          taxable income  in future  years.   For  alternative minimum  tax
          purposes,  the  loss  carryforward  is  approximately $6,200,000.
          Management  expects  to  fully  utilize  these  loss  and  credit
          carryforwards before  they expire in  the year 2011;  however, in
          accordance with  Statement of Financial  Accounting Standards No.
          109,  "Accounting for  Income  Taxes," a  valuation allowance  of
          approximately $1,700,000 has been recognized.  In addition to the
          loss  carryforwards,  the Company  has approximately  $836,000 of
          alternative minimum  tax credit carryforwards available to offset
          future  federal  regular  income taxes.    This  credit  does not
          expire.
               As a  result of the  foregoing, the  Company incurred a  net
          loss  for  the  year  ended  December  31,  1996,  of  $8,683,000
          (negative 9  percent of net revenue) compared  to a net income of
          $1,343,000  (1 percent of net revenue)  during the same period in
          1995.

          Year Ended December 31, 1995, Compared to Year Ended December 31,
          1994

               During  the  year  ended  December  31,  1995,  net  revenue
          increased by 12 percent to  $95,426,000 from $85,353,000 for  the
          year ended December 31, 1994. The increase in revenue  associated
          with  the  Company's  utility contracting  services  ($14,329,000
          increase in net revenue) is primarily due to the Company's change
          in  focus  towards non-environmental  projects.  The  increase in
          revenue associated with the Company's solid waste management<PAGE>





          services ($10,887,000  increase in net revenue)  is primarily due
          to  the commencement  of two  municipal contracts  during October
          1995 to provide residential  collection services. The decrease in
          revenue  associated  with  the  Company's  industrial  demolition
          services  ($11,911,000 decrease  in  net revenue)  is due  to the
          completion of  a  major contract  during  1994. The  decrease  in
          revenue associated with the Company's asbestos abatement services
          ($1,751,000  decrease in net revenue)  is due to  the Company de-
          emphasizing  these  services and  only  performing  this work  in
          conjunction  with  the Company's  other  environmental demolition
          activities.  The impact of price increases on net revenue is less
          than one percent.

               Outside  services, which  primarily consist  of payments  to
          subcontractors, increased as  a percentage of net revenue from 13
          percent during  the year ended  December 31, 1994, to  17 percent
          during 1995. The Company will use the services of a subcontractor
          when it determines that  an economic opportunity exists regarding
          internally  providing  the  services. The  Company  utilized  the
          services of subcontractors  to a greater extent  during 1995 than
          1994  in  order  to  meet established  minority  requirements  on
          certain municipal contracts.

               Cost of revenue earned increased to $77,466,000 for the year
          ended  December 31,  1995,  from $73,235,000  for the  comparable
          period of 1994. As  a result, gross profit during the  year ended
          December 31,  1995, increased to  $17,960,000 (19 percent  of net
          revenue) from  $12,117,000 (14 percent  of net revenue)  in 1994.
          The increase in the dollar amount and percentage of  gross profit
          primarily is associated with the growth of the  Company's utility
          contracting ($2,963,000 increase in gross profit) and solid waste
          management services  ($3,751,000 increase  in gross  profit). The
          dollar and percentage  increase in gross profit  from solid waste
          management  services  is  directly  related to  the  increase  in
          industrial  and  commercial  solid  waste  services,  which  have
          historically had  higher profit margins than  the Company's other
          solid waste management operations.  This increase offsets certain
          decreases  in  the   Company's  industrial  demolition   services
          ($959,000  decrease  in  gross  profit)  and  asbestos  abatement
          services ($228,000 decrease in gross profit).<PAGE>





               Included in  the Company s  operating results for  the years
          ended December 31, 1994 and  1995 is the activity related  to the
          settlement and/or  resolution of  contract claims  and unapproved
          change orders.  This activity can be summarized as follows:

                                                 Years ended December 31, 
                                                ---------------------------
                                                    1994          1995     
                                                ------------- -------------
                                                
          Claim recoveries  . . . . . . . . . . $  1,198,000  $  1,618,000 
                                                
          Cost of recoveries  . . . . . . . . .      976,000     1,145,000
                                                ------------- -------------
          Gain (loss) on resolved claims  . . . $    222,000  $    473,000 
                                                ============= =============

               In  addition,  the Company  incurred  costs associated  with
          unresolved claims  of $4,952,000  and $6,440,000 during  1995 and
          1996, respectively.

               The Company had the  following balances recorded relating to
          contract  claims and unsigned change orders  at December 31, 1994
          and 1995:
                                                       December 31,       
                                                ---------------------------
                                                    1994          1995     
                                                ------------- -------------
                                                
          Claims  . . . . . . . . . . . . . . . $  6,492,000  $  9,128,000 
          Unapproved change orders  . . . . . .        -         2,659,000 
                                                ------------- -------------
                                                $  6,492,000  $ 11,787,000 
                                                ============= =============
          Cumulative external claim             
           preparation costs included above . . $    683,000  $  1,226,000 
                                                ============= =============

               During  1995, selling,  general and  administrative expenses
          increased  to  $13,364,000 from  $9,447,000  for  the year  ended
          December 31, 1994. The dollar  increase in selling, general,  and
          administrative  expenses primarily  is attributable  to increased
          overhead  costs, such  as  office salaries  and marketing  costs,
          associated  with  higher  levels of  operations.  The  percentage
          increase   in  selling,   general  and   administrative  expenses
          primarily is  associated with the  growth of the  Company's solid
          waste  management  operations,  which has  an  overhead structure
          equal  to 16  percent of  its  net revenue.  These services  have
          historically operated  with a higher overhead  structure than the
          Company's specialty contracting operations, which has an overhead
          structure equal to 13 percent of its net revenue.

               As a result of the foregoing,  operating income increased to
          $4,596,000 (5 percent of net revenue) during the year ended<PAGE>





          December  31,  1995, compared  to  $2,670,000 (3  percent  of net
          revenue) during the same period in 1994. 

               Minority interest  in net income of  the TransCor subsidiary
          was $345,000  for the year  ended December 31, 1995,  compared to
          $61,000 for  the  year  ended December  31,  1994.  The  minority
          interest in net income  of such subsidiary reflects approximately
          26 percent  of TransCor's earnings  as a result of  the March 25,
          1993,  initial public  offering of  TransCor's common  stock. The
          increase in TransCor's earnings  between years is attributable to
          the  higher   profit  margins  earned  on   certain  solid  waste
          management services.

               Net   interest  expense   increased   to   $1,418,000   from
          $1,077,000,  which   corresponds   with  the   increase  in   the
          interest-bearing debt outstanding between periods.

               The Company's  effective tax rate  was 52.6 percent  for the
          year  ended December  31, 1995, compared  to a  tax rate  of 48.0
          percent for the year ended December 31, 1994. The increase in the
          effective tax rate was primarily due to higher state income taxes
          and additional taxes on the income of TransCor.

               As a result of  the foregoing, net income for the year ended
          December 31,  1995, was  $1,343,000 (1  percent  of net  revenue)
          compared to  a net income of $797,000 (less than 1 percent of net
          revenue) during the same period in 1994.

          Liquidity and Capital Resources

               Cash   provided  by  operating  activities  was  $3,884,000,
          $4,941,000,  and $1,061,000  for the  years ended  December 1994,
          1995  and 1996,  respectively.   Cash provided  by the  Company s
          solid waste  management services segment amounted  to $1,770,000,
          $4,306,000 and  $4,464,000 in 1994, 1995  and 1996, respectively.
          Cash provided  or (used)  by the Company s  specialty contracting
          segment  amounted  to  $2,114,000, $635,000  and  ($3,403,000) in
          1994,  1995 and  1996, respectively.   Cash  was provided  by the
          solid  waste management  services segment  operations in  1996 at
          expected levels.   Cash  was  used in  the specialty  contracting
          operations due  to significant  contract losses,  discussed under
          results of  operations, offset  by the  increase or  extension of
          payments on accounts payable and accrued  expenses.  Increases in
          the Company s  accounts payable and accrued  expenses amounted to
          $1,743,000,  $7,630,000 and  $2,834,000 in  1994, 1995  and 1996,
          respectively.   While  these  increases in  1994  and  1995  were
          generally  in   response  to  increased   operating  levels,  the
          extensions in 1996 were a result of cash management actions taken
          by  management to  maintain  liquid  assets  in the  presence  of
          current operating losses.<PAGE>





               The   Company  had   capital  expenditures   of  $5,804,000,
          $15,425,000,   and   $6,968,000   in   1994,   1995,   and  1996,
          respectively. These  expenditures were  primarily related  to the
          acquisition  of  equipment associated  with  the Company's  solid
          waste  management  and  utility  contracting  operations.  Future
          capital  expenditures   will  be   financed  by  available   cash
          resources,  cash  flow  from  operations  and   available  credit
          resources, as needed.

               During  1996, the  Company  generated  cash  from  financing
          activities of $5,229,000, which was  net of purchases on the open
          market  of  73,828  shares  of  the Company s  common  stock  for
          $312,000.    Borrowings  in  1996 related  primarily  to  working
          capital drawings on lines of credit to support current operations
          in  the  specialty contract  services  segment.   Net  borrowings
          (payments) on  credit lines  and debt balances  were ($1,149,000)
          and  $10,315,000 in  1994  and 1995,  respectively.   Significant
          borrowings in  1995 were  primarily attributable to  purchases of
          new equipment  to support increased operations in the solid waste
          management services segment.

               The Company is subject to a variety of restrictive covenants
          under  various  debt agreements  with  one  of its  institutional
          lenders.  In 1996  the Company  failed to  meet the  consolidated
          tangible  net  worth, debt  to  consolidated  tangible net  worth
          ratio, consolidated  debt service  coverage  ratio, fixed  charge
          coverage  ratio,  and  net  income requirement  with  regards  to
          approximately $11,000,000  of its bank  debt. As of  December 31,
          1996, the Company obtained waivers for these covenants and may be
          required to obtain similar waivers for certain covenants in 1997.
          The Company  has obtained  a representation from  Mr. Francis  M.
          Williams  should  waivers not  be  obtained during  1997  and the
          lender accelerates the maturities of the Revolving Term Bank Line
          of  Credit  and  Mortgage  Note  on  the corporate  office.  This
          representation provides that Mr. Williams will lend the necessary
          funds to  the Company,  or arrange  for the  Company to  borrow a
          similar amount  under similar  terms and  maturities so  that the
          Company is not required to pay any principal payments during 1997
          more than  the regularly scheduled  maturities. There  can be  no
          assurance  that Mr.  Williams will  have sufficient  resources to
          fund the  Company s capital requirements.   Any further inability
          to achieve future compliance with the loan covenants could affect
          the Company's  access  to further  borrowings  or require  it  to
          secure additional equity by other means. 

               On  February  26, 1997,  the  Company,  through its  Kimmins
          Contracting Corp.  subsidiary,  entered into  a credit  agreement
          with  a  financial  institution that  provides  for  unrestricted
          borrowings up to $11,000,000.   As of April 21, 1997, the Company
          has  drawn approximately  $7,000,000 on  the facility,  which was
          used to partially paydown bank debt.  Borrowings on this facility
          are due in February 1999.  In addition, on February 26, 1997, the
          Company issued approximately $13,000,000  of term debt to acquire
          certain operating assets currently used in the specialty<PAGE>





          contracting business that had been leased under operating leases.
          The term debt requires periodic payments through February 2004.

               The Company's  ratio of debt  to total equity  was 1.29:1.00
          and  2.15:1.00 at December  31, 1995 and  1996, respectively. The
          increase  in debt is primarily  due to increased borrowings under
          the  Company s  revolving  term  bank  line  of  credit  to  fund
          operations.  In addition, the  increase can  be attributed  to an
          increase in equipment loans associated  with capital expenditures
          required  for  the  commencement  of two  municipal  solid  waste
          management contracts during the fourth quarter of 1995.

               During the  years  ended December  31,  1995 and  1996,  the
          Company's average contract and trade receivables were outstanding
          for  77  and 76  days,  respectively.   The  Company  anticipates
          sustaining  this rate of  collection for the  year ended December
          31, 1997. Management believes that the number of days outstanding
          for  its receivables  approximates  industry norms.  Part of  the
          Company's  contracting operations is subcontracted, and any delay
          in collections of receivables  relating to primary contracts will
          generally result in a delay of payment to subcontractors.

                The Company has  a note receivable in an original amount of
          $3,638,696  from  Sunshadow  Apartments,  Ltd.,  and Summerbreeze
          Apartments, Ltd.,  two Florida  real estate limited  partnerships
          (collectively,  the  "Apartments"),  of  which  Mr.   Francis  M.
          Williams is the sole shareholder of the corporate general partner
          and  the sole  limited  partner. The  note receivable  originally
          accrued interest at prime plus 1.375 percent, increasing to prime
          plus  2 percent  on  July 1,  1995, with  principal  and interest
          payable in monthly installments through December 31, 1998, and is
          guaranteed  by Mr.  Williams.  The Company  did  not receive  any
          interest or principal payments during 1996 relating  to this note
          receivable,   and  management   of   the   Company   discontinued
          recognition of interest income  of approximately $551,000 for the
          year.  Amounts  due from the Apartments at  December 31, 1995 and
          1996, are approximately $3,851,000.

               At December 31,  1995 and 1996,  $5,301,000 of the  combined
          accounts receivable - affiliates  and note receivable - affiliate
          balances  are  due from  corporate  affiliates  of the  Company's
          President. The affiliated receivables relate to contract services
          performed and are guaranteed by Mr. Williams.

               Historically, the Company  has obtained bonding  coverage in
          amounts up  to $8.5 million for  environmental projects. However,
          the  Company has  experienced difficulties  in  obtaining bonding
          coverage  for  environmental  projects  more  than  this  amount.
          Although each  project  has its  own distinct  and separate  bond
          requirements,  the Company  may  be  unable  to bid  on  projects
          competitively that require a bond more than $8.5 million.

               At  December   31,  1996,   the  Company  had   no  material
          commitments for capital expenditures.<PAGE>





               See Note  18 of  Notes to Consolidated  Financial Statements
          for the Company's business segment information.

          Effects of Change in Method of Accounting

               In October 1995,  the Financial  Accounting Standards  Board
          ("FASB") issued Statement of  Financial Accounting Standards  No.
          123,  "Accounting for Stock-Based  Compensation" ("FAS  No. 123")
          effective for transactions entered  into after December 15, 1995.
          FAS  No.  123  provides  alternatives for  the  methods  used  by
          entities  to  record  compensation expense  associated  with  its
          stock-based  compensation  plans.    Additionally,  FAS  No.  123
          provides further guidance on the disclosure requirements relating
          to stock-based  compensation plans that are  effective for fiscal
          years beginning after December 15, 1995.  The adoption of FAS No.
          123  has not had a material  impact on the financial condition or
          the results of operations of the Company.

               In  February  1997,  FASB  issued  "Statement  of  Financial
          Accounting  Standards No.  128,  "Earnings per  Share" ("FAS  No.
          128"), which is  effective for periods ending after  December 15,
          1997.   This  statement establishes  standards for  computing and
          presenting  earnings per  share  data.   Management is  currently
          assessing the impact of FAS No. 128 on the Company s presentation
          of earnings per share data in future periods.

          Forward-Looking Information

               The  foregoing  discussion in  "Management s  Discussion and
          Analysis  of  Financial  Condition  and  Results  of  Operations"
          contains  forward-looking  statements  that reflect  management s
          current  views  with  respect  to  future  events  and  financial
          performance.   Such statements  involve risks and  uncertainties,
          and there are  certain important factors that  could cause actual
          results to differ materially from those anticipated.  Some of the
          important  factors  that could  cause  actual  results to  differ
          materially from  those anticipated  include, but are  not limited
          to,   economic   conditions,  competitive   factors,   and  other
          uncertainties,  all of which are difficult to predict and many of
          which  are beyond  the  control of  the  Company.   Due  to  such
          uncertainties and risk, readers are cautioned not to place  undue
          reliance on such forward-looking  statements, which speak only as
          of the date hereof.

          Effect of Inflation

               Inflation  has  not had,  and  is not  expected  to  have, a
          material  impact upon  the  Company's operations.   If  inflation
          increases,  the Company  will attempt  to increase its  prices to
          offset  its  increased expenses.    No  assurance can  be  given,
          however, that the Company will be able to adequately increase its
          prices in response to inflation.<PAGE>





          Item 8.  Financial Statements and Supplementary Data


                                    KIMMINS CORP.
                          INDEX TO FINANCIAL STATEMENTS AND                    
                             FINANCIAL STATEMENT SCHEDULE

                                                                       Page
                                                                       ----

          Report of Independent Certified Public Accountants  . . . . .  20

          Consolidated balance sheets at December 31, 1995 and 1996 . .  21

          Consolidated statements of operations for each of the 
           three years in the period ended December 31, 1996  . . . . .  23

          Consolidated statements of stockholders' equity for each of 
           the three years in the period ended December 31, 1996  . . .  24

          Consolidated statements of cash flows for each of the 
           three years in the period ended December 31, 1996  . . . . .  25

          Notes to consolidated financial statements  . . . . . . . . .  26


          Financial statement schedule:

          Schedule II - Valuation and qualifying accounts . . . . . . . S-1

               All  other  schedules   are  omitted   since  the   required
          information  is  not present  in  amounts  sufficient to  require
          submission of the schedule or because the information required is
          included in the financial statements and notes thereto.<PAGE>





                  REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS



          The Board of Directors and Stockholders
          Kimmins Corp.


               We have audited the accompanying consolidated balance sheets
          of  Kimmins Corp.  as of  December  31, 1995  and  1996, and  the
          related  consolidated  statements  of  operations,  stockholders'
          equity, and cash flows for each of the three years  in the period
          ended  December 31, 1996. Our audits  also included the financial
          statement schedule  listed  in the  index  at Item  14(a).  These
          financial statements  and schedule are the  responsibility of the
          Company's management. Our responsibility is to express an opinion
          on these  financial  statements and  the  schedule based  on  our
          audits. 

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

               In  our  opinion,   the  consolidated  financial  statements
          referred to above present fairly,  in all material respects,  the
          consolidated financial position of  Kimmins Corp. at December 31,
          1995 and 1996, and the consolidated results of its operations and
          its cash  flows for each of  the three years in  the period ended
          December  31,  1996,   in  conformity  with  generally   accepted
          accounting  principles.  Also,  in   our  opinion,  the   related
          financial statement schedule, when  considered in relation to the
          basic  financial statements taken as  a whole, presents fairly in
          all material respects the information set forth therein.




                                                      /s/ Ernst & Young LLP




          Tampa, Florida
          April 14, 1997<PAGE>





                                    KIMMINS CORP.

                             CONSOLIDATED BALANCE SHEETS

                                        ASSETS

                                                       December 31,       
                                                ---------------------------
                                                    1995          1996     
                                                ------------- -------------
          Current assets:                       
           Cash . . . . . . . . . . . . . . . . $  1,160,463  $    968,638 
           Accounts receivable:                 
             Contract and trade . . . . . . . .   21,755,341    20,060,169 
             Affiliates . . . . . . . . . . . .    1,903,832     1,648,529 
           Note receivable - affiliate  . . . .       56,667         -     
           Costs and estimated earnings in                                 
             excess of billings on              
             uncompleted contracts  . . . . . .   17,001,286    15,967,872 
           Income tax refund receivable . . . .    1,050,625     1,199,775 
           Deferred income tax, net . . . . . .      742,130     1,499,329 
           Other current assets . . . . . . . .      446,848       512,110 
                                                ------------- -------------
             Total current assets . . . . . . .   44,117,192    41,856,422 
                                                ------------- -------------
                                                
          Property and equipment, net . . . . .   37,592,661    38,877,521 
          Intangible assets, net  . . . . . . .      785,175       898,853 
          Accounts receivable - affiliates  . .    1,450,716     1,450,716 
          Note receivable - affiliate . . . . .    3,794,060     3,850,727 
          Term note from affiliate (including                              
           accrued interest of $506,755 at      
           December 31, 1995) . . . . . . . . .    4,797,804         - 
          Investment in Cumberland              
           Technologies, Inc. . . . . . . . . .        -         5,105,632 
          Other assets, net . . . . . . . . . .    1,090,942     1,043,036 
                                                ------------- -------------
                                                $ 93,628,550  $ 93,082,907 
                                                ============= =============

                               See accompanying notes.<PAGE>





                                    KIMMINS CORP.
                             CONSOLIDATED BALANCE SHEETS
                         LIABILITIES AND STOCKHOLDERS' EQUITY

                                                       December 31,   
                                                ---------------------------
          Current liabilities:                      1995          1996     
                                                ------------- -------------
           Accounts payable - trade . . . . . . $ 17,358,270  $ 19,169,607 
           Accrued expenses . . . . . . . . . .    7,049,132     8,072,187 
           Billings in excess of costs and      
             estimated earnings on uncompleted  
             contracts  . . . . . . . . . . . .      606,614       752,287 
           Current portion of long-term debt. .    7,074,857     7,794,848 
           Current portion of Employee Stock    
             Ownership Plan trust debt  . . . .      480,000       480,000 
                                                ------------- -------------
             Total current liabilities  . . . .   32,568,873    36,268,929 
                                                ------------- -------------
          Long-term debt  . . . . . . . . . . .   24,619,969    29,920,396 
          Employee Stock Ownership Plan         
           Trust debt . . . . . . . . . . . . .    1,920,000     1,440,000 
          Deferred income taxes   . . . . . . .    4,559,531     4,159,605 
          Minority interest in subsidiary . . .    3,578,741     3,440,681 
          Commitments and contingencies         
           (Note 15)  . . . . . . . . . . . . .        -             -     
                                                
          Stockholders' equity:                 
           Preferred stock, $.001 par value;    
             1,000,000 shares authorized, none  
             issued and outstanding . . . . . .        -             - 
           Common stock, $.001 par value;       
             32,500,000 shares authorized;      
             4,447,397 shares issued and
             outstanding  . . . . . . . . . . .        4,447         4,447
           Class B common stock, $.001 par      
             value; 10,000,000 shares           
             authorized, 2,291,569 shares
             issued and outstanding . . . . . .        2,292         2,292
           Capital in excess of par value . . .   18,730,173    18,730,173 
           Retained earnings  . . . . . . . . .    9,911,606     1,228,167 
           Unearned employee compensation       
             from Employee Stock Ownership      
             Plan Trust   . . . . . . . . . . .   (2,267,082)   (1,800,000)
                                                ------------- -------------
                                                  26,381,436    18,165,079 
           Less treasury stock, at cost  
            (73,828 shares)  . . . . . . . . .        -          (311,783)
                                                ------------- -------------
              Total stockholders' equity  . . .   26,381,436    17,853,296 
                                                ------------- -------------
                                                $ 93,628,550  $  93,082,907
                                                ============= =============
                               See accompanying notes.<PAGE>





                                    KIMMINS CORP.

                        CONSOLIDATED STATEMENTS OF OPERATIONS

                                          Years ended December 31,        
                                  -----------------------------------------
                                      1994          1995          1996     
                                  ------------- ------------- -------------
          Revenue:                              
           Gross revenue    . . . $ 96,755,001  $111,346,075  $113,240,908 
           Outside services, at                 
             cost . . . . . . . .  (11,402,286)  (15,919,816)  (15,264,042)
                                  ------------- ------------- -------------
           Net revenue  . . . . .   85,352,715    95,426,259    97,976,866 
          Costs and expenses:                   
           Cost of revenue                      
             earned . . . . . . .   73,235,439    77,465,818    90,268,700 
           Selling, general and                 
             administrative                     
             expenses . . . . . .    9,447,064    13,364,168    15,514,654
                                  ------------- ------------- -------------
          Operating income                      
           (loss) . . . . . . . .    2,670,212     4,596,273    (7,806,488)
          Minority interest in                  
           net (income) loss of                 
           subsidiary . . . . . .      (60,624)     (345,320)      138,060 
          Interest expense (net                 
           of interest income of                
           approximately
           1,060,000, $1,005,000,
           and $569,000 for the
           years ended December
           31, 1994, 1995, and
           1996, respectively). .   (1,076,911)   (1,417,802)   (3,107,000)
                                  ------------- ------------- -------------
          Income (loss) before                  
           provision for income
           taxes (benefit)  . . .    1,532,677     2,833,151   (10,775,428)
          Provision for income                  
           taxes (benefit):                     
             Current  . . . . . .      650,788       661,472      (934,864)
             Deferred . . . . . .       84,897       829,096    (1,157,125)
                                  ------------- ------------- -------------
                                       735,685     1,490,568    (2,091,989)
                                  ------------- ------------- -------------
          Net income (loss)   . . $    796,992  $  1,342,583  $ (8,683,439)
                                  ============= ============= =============




                               See accompanying notes.<PAGE>





                                    KIMMINS CORP.

                        CONSOLIDATED STATEMENTS OF OPERATIONS
                                     (continued)
          Per Share Data:                       
           Income (loss) per                    
             share  . . . . . . . $        .18  $        .30  $      (1.96)
                                  ============= ============= =============
           Weighted average                     
             number of shares                   
             outstanding used in
             computation  . . . .    4,442,997     4,544,180     4,420,175
                                  ============= ============= =============








                               See accompanying notes.<PAGE>





     <TABLE>
                                    KIMMINS CORP.

                   CONSOLIDATED STATEMENTS OF STOCKHOLDERS  EQUITY
     <CAPTION>                                               
                                                     Class B
                              Common Stock        Common Stock      Capital in
                          -------------------  -------------------   Excess of
                            Shares     Amount    Shares    Amount    Par Value  
                          ---------- --------  ---------- -------- ------------
     <S>                  <C>        <C>       <C>        <C>      <C>
     Balance at                                           
      January 1, 1994  .   4,442,997 $  4,443  2,291,569  $ 2,292  $ 18,710,378 
     Employee                                             
      compensation from                                   
      Employee Stock
      Ownership Trust  .        -        -         -          -          - 
     Net income  . . . .        -        -         -          -          -
                          ---------- --------  ---------- -------- ------------
     Balance at                                           
      December 31, 1994    4,442,997    4,443  2,291,569    2,292    18,710,378
                                                          
     Stock options                                        
      exercised  . . . .       4,400        4      -          -          19,795
     Employee                                             
      compensation from                                   
      Employee Stock
      Ownership Trust  .        -        -         -          -          -
     Net income  . . . .        -        -         -          -          -      
                          ---------- --------  ---------- -------- ------------
     Balance at                                           
      December 31, 1995    4,447,397    4,447  2,291,569    2,292    18,730,173 
                                                          
     Employee                                             
      compensation from                                   
      Employee Stock
      Ownership Trust  .        -         -        -          -          - 
     Purchase of treasury                                 
      stock, at cost . .        -         -        -          -          -     
     Net loss  . . . . .        -         -        -          -          -     
                          ---------- --------  ---------- -------- ------------
     Balance at                                           
      December 31, 1996    4,447,397 $  4,447  2,291,569  $ 2,292  $ 18,730,173 
                          ========== ========  ========== ======== ============
     </TABLE>                                             

                               See accompanying notes.<PAGE>





     <TABLE>
                                    KIMMINS CORP.

                   CONSOLIDATED STATEMENTS OF STOCKHOLDERS  EQUITY
                                     (continued)     <CAPTION>

                                         Unearned   
                                         Employee   
                                       Compenation  
                                           from     
                                         Employee   
                                          Stock                     Total
                            Retained    Ownership    Treasury   Stockholders 
                            Earnings    Plan Trust    Stock        Equity    
                          -----------  ------------ ---------- --------------
     <S>                  <C>          <C>          <C>        <C>
     Balance at                                     
      January 1, 1994  .  $ 7,772,031  $(3,387,591) $   -      $  23,101,553 
     Employee                                       
      compensation from                             
      Employee Stock
      Ownership Trust  .        -          615,657      -            615,657
     Net income  . . . .      796,992       -           -            796,992 
                          -----------  ------------ ---------- --------------
     Balance at                                     
      December 31, 1994     8,569,023   (2,771,934)     -         24,514,202 
                                                    
     Stock options                                  
      exercised  . . . .        -           -           -             19,799 
     Employee                                       
      compensation from                             
      Employee Stock
      Ownership Trust  .        -          504,852      -            504,852
     Net income  . . . .    1,342,583       -           -          1,342,583 
                          -----------  ------------ ---------- --------------
     Balance at                                     
      December 31, 1995     9,911,606   (2,267,082)     -         26,381,436 
                                                    
     Employee                                       
      compensation from                             
      Employee Stock
      Ownership Trust  .        -          467,082      -            467,082
     Purchase of treasury                           
      stock, at cost   .        -            -       (311,783)      (311,783)
     Net loss  . . . . .   (8,683,439)       -          -         (8,683,439)
                          -----------  ------------ ---------- -------------- 
     Balance at                                     
      December 31, 1996   $ 1,228,167  $(1,800,000) $(311,783) $  17,853,296 
                          ===========  ============ ========== ==============
     </TABLE>                                       

                               See accompanying notes.<PAGE>





                                    KIMMINS CORP.

                        CONSOLIDATED STATEMENTS OF CASH FLOWS

                                          Years ended December 31,         
                                  -----------------------------------------
                                      1994          1995          1996     
                                  ------------- ------------- -------------
          Cash flows from                       
           operating activities:                
             Net income (loss)  . $    796,992  $  1,342,583  $ (8,683,439)
             Adjustments to                     
              reconcile net                     
              income (loss) to
              net cash provided
              by operating
              activities:
               Depreciation and
                amortization  . .    4,050,339     4,301,711     5,650,341
               Provision for
                uncollectible
                accounts
                receivable  . . .      495,375       404,455       430,381
               Minority interest
                in income (loss)
                of subsidiary . .       60,624       345,320      (138,060)
               (Gain) loss on
                disposal of
                property and
                equipment   . . .      407,3235     (241,034)      (22,359)
               Accrued interest                 
                on term note  . .       65,378      (454,772)     (372,066)
               Equity in losses                 
                of investment . .        -             -            36,766 
               Deferred income                  
                taxes   . . . . .       84,897       829,096    (1,157,125)
               Unearned employee                
                compensation from               
                Employee Stock                  
                Ownership Plan                  
                Trust . . . . . .      615,657       504,852       467,082 
               Changes in                       
                operating assets                
                and liabilities:                                  
                 Accounts and
                  notes
                  receivable  . .   (4,518,539)     (881,808)    1,520,094




                               See accompanying notes.<PAGE>





                                    KIMMINS CORP.

                        CONSOLIDATED STATEMENTS OF CASH FLOWS
                                     (continued)

                                          Years ended December 31,         
                                  -----------------------------------------
                                      1994          1995          1996     
                                  ------------- ------------- -------------
                  Costs and                     
                   estimated                    
                   earnings in
                   excess of
                   billings on
                   uncompleted
                   contracts  . .     (388,478)   (6,835,059)    1,033,414
                  Income tax                    
                   refund                       
                   receivable . .      253,963      (371,087)     (149,150)
                  Other assets  .     (127,226)     (864,933)     (535,230)
                  Accounts                      
                   payable -                    
                   trade  . . . .      823,160     4,054,862     1,811,337
                  Accrued                       
                   expenses . . .      920,094     3,575,357     1,023,055 
                  Billings in                   
                   excess of                    
                   costs and
                   estimated
                   earnings on
                   uncompleted
                   contracts  . .      344,836      (768,934)      145,673
                                  ------------- ------------- -------------
                  Total                         
                   adjustments  .    3,087,405     3,598,026     9,744,153 
                                  ------------- ------------- -------------
          Net cash provided by                  
           operating                            
           activities . . . . . .    3,884,397     4,940,609     1,060,714 
                                  ------------- ------------- -------------
          Cash flows from                       
           investing activities:                
             Capital expenditures               
              including                         
              $2,267,000 and                    
              $500,000 of                       
              business                          
              acquisitions during               
              1995 and 1996,
              respectively  . . .     (5,803,781)  (15,425,379)   (6,968,009)


                               See accompanying notes.<PAGE>





                                    KIMMINS CORP.

                        CONSOLIDATED STATEMENTS OF CASH FLOWS
                                     (continued)

                                          Years ended December 31,         
                                  -----------------------------------------
                                      1994          1995          1996     
                                  ------------- ------------- -------------
             Proceeds from sale                 
              of property and                   
              equipment . . . . .    1,017,482       851,623       486,835 
                                  ------------- ------------- -------------
          Net cash used by
           investing 
           activities . . . . . .   (4,786,299)  (14,573,756)   (6,481,174)
                                  ------------- ------------- -------------
          Cash flows from                       
           financing activities:                
             Proceeds from long-                
              term debt . . . . .   16,604,165    19,611,436    14,556,332 
             Repayments of                      
              long-term debt  . .  (17,153,585)   (8,716,731)   (8,535,914)
             Repayments of                      
              Employee Stock                    
              Ownership Plan
              Trust debt  . . . .     (600,000)     (600,000)     (480,000)
             Purchase of treasury
              stock . . . . . . .        -             -          (311,783)
             Proceeds from stock
              options . . . . . .        -            19,799         -
                                  ------------- ------------- -------------
          Net cash provided                     
           (used) by financing   
           activities . . . . . .   (1,149,420)   10,314,504     5,228,635 
                                  ------------- ------------- -------------
          Net increase (decrease)               
           in cash    . . . . . .   (2,051,322)      681,357      (191,825)
          Cash, beginning                       
           of year  . . . . . . .    2,530,428       479,106     1,160,463 
                                  ------------- ------------- -------------
          Cash, end of year . . . $    479,106  $  1,160,463  $    968,638 
                                  ============= ============= =============



                               See accompanying notes.<PAGE>





                                    KIMMINS CORP.

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          1.   Organization and summary of 
               significant accounting policies

               Organization   -  Kimmins   Corp.   and   its   subsidiaries
          (collectively,  the "Company")  operates  two business  segments:
          solid   waste  management  services   and  specialty  contracting
          services.   The Company provides solid  waste management services
          to commercial,  industrial, residential and,  municipal customers
          in  the  state  of  Florida.    The  Company  provides  specialty
          contracting  services  in  the  south  and  northeast,  including
          infrastructure development; underground construction; road  work;
          site  remediation  services  such   as  excavation,  removal  and
          disposal   of  contaminated   soil;  facilities   demolition  and
          dismantling; and asbestos abatement.

               Principles  of consolidation  -  The consolidated  financial
          statements include the accounts  of Kimmins and its subsidiaries,
          including  TransCor  Waste  Services,  Inc.  ("TransCor"),  a  74
          percent owned subsidiary.  All material intercompany transactions
          have been eliminated.

               Use of  estimates - The preparation  of financial statements
          in  conformity  with  generally  accepted  accounting  principles
          requires management to make estimates and assumptions that affect
          the amounts reported in the financial statements and accompanying
          notes. Actual results could differ from those estimates.

               Concentrations of credit risk -  Financial instruments which
          subject  the Company  to  concentrations of  credit risk  consist
          primarily of trade  receivables in the  State of Florida.   Trade
          receivables  are comprised  primarily of  amounts due  from solid
          waste   management  customers   and   on  specialty   contracting
          contracts.   Credit  is extended  based on  an evaluation  of the
          customer's  financial  condition.   Collateral  is generally  not
          required;  however, the  Company has  the ability  to file  for a
          mechanic's  lien to  protect  its interest  in contract  accounts
          receivable.  Credit  losses are  provided  for  in the  financial
          statements and have been within management's expectations.

               Accounts receivable - trade, net includes $1,322,000 related
          to  a municipal solid  waste management  contract with  St. Lucie
          County.  Unlike other municipal solid waste management contracts,
          St.  Lucie County  requires  the  Company  to  bill  and  collect
          directly from individual property owners.   Pursuant to St. Lucie
          County ordinances, property owners that are delinquent in payment
          are  subject to  lien rules.   The  Company has  placed liens  on
          approximately    2,250    individual   properties    representing
          approximately $511,000 of  the balance as  of December 31,  1996.
          Management intends to file additional liens when considered<PAGE>





                                    KIMMINS CORP.

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          1.   Organization and summary of 
               significant accounting policies (continued)

          appropriate, and all such liens will  be maintained in accordance
          with applicable laws until the outstanding balances are recovered
          by payment, judgement, foreclosure, or other action.

               Intangible assets - Intangible assets consist principally of
          the  excess of costs over fair market  value of the net assets of
          the acquired solid waste management business, which are amortized
          on a straight-line  basis over twenty years,  and customer lists,
          which are amortized  on a  straight-line basis  over five  years.
          Amortization expense was $67,000 and $124,000 for the years ended
          December  31,  1995  and  1996  (none  for  1994),  respectively.
          Accumulated amortization was  approximately $67,000 and  $191,000
          at December 31, 1995 and 1996, respectively. 

               Investments  -   The  Company s  30  percent  investment  in
          Cumberland Technologies,  Inc.  ("Cumberland") is  accounted  for
          using the equity method of accounting.

               Other  assets  -  Other  assets consist  primarily  of  pre-
          contract costs associated with residential solid waste management
          contracts obtained during 1995 and 1996, which are amortized on a
          straight-line basis  over five years, the term  of the contracts,
          and loan costs, which are amortized  over the term of the  loans.
          Amortization expense was $160,000, $197,000, and $280,000 for the
          years  ended  December 31,  1994,  1995  and 1996,  respectively.
          Accumulated amortization  was $357,000  and $637,000 at  December
          31, 1995 and 1996, respectively.

               Income  taxes - Income  taxes have  been provided  using the
          liability   method  in   accordance  with   Financial  Accounting
          Standards  Board  ("FASB")  Statement  No.  109, "Accounting  for
          Income Taxes."

               Contracts  and  revenue  recognition  -  Contracts generally
          range  from  6  to  18  months  in  duration, and  earnings  from
          contracting     operations     are     reported     under     the
          percentage-of-completion method for financial statement purposes.
          The  estimated  earnings  for  each  contract  reflected  in  the
          accompanying  financial statements  represent  the percentage  of
          estimated  total earnings  that costs  incurred to  date bear  to
          estimated total costs, based  on the Company's current estimates.
          With respect to contracts that extend over one or more accounting
          periods, revisions in costs  and earnings estimates are reflected
          in the period  the revisions become known. When current estimates
          of  total contract costs  indicate a loss,  provision is made for
          the entire estimated loss.<PAGE>





                                    KIMMINS CORP.

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          1.   Organization and summary of 
               significant accounting policies (continued)

               Change orders are modifications to an original contract that
          effectively change the scope and/or price of  the contract.  They
          may include changes in specifications or design, method or manner
          of performance, facilities, equipment, materials, site, or period
          for completion of the  work.  Certain change orders may be priced
          under  the  terms  of  the contract.    Other  change  orders are
          unpriced; that is, the work to be  performed is defined; however,
          the adjustment  to the contract price is negotiated subsequent to
          performance.  Finally, in  some cases, both scope and  price of a
          change  order may be  unapproved or  in dispute.   Accounting for
          change orders depends on  the underlying circumstances, which may
          differ for  each  change order  depending  on the  customer,  the
          contract,  and the nature  of the change.   The Company evaluates
          each  change  order  according  to its  characteristics  and  the
          circumstances in which they occur.

               Contract revenue and  associated profit  are recognized  for
          change  orders  approved  by  the  customer  and  the  contractor
          regarding both scope and price to the extent  performance related
          to the change order matter has occurred.

               Accounting for  change orders,  where either scope  or price
          have not been determined, depends on careful consideration of the
          underlying characteristics  and the  circumstances in  which they
          occur.    For all  unpriced  change  orders, recovery  is  deemed
          probable if the terms of  the contracts or other applicable legal
          principles provide  a legal  basis for recoverability,  the costs
          incurred are  objective and verifiable, and,  finally, all future
          events necessary for recovery are  more likely than not to occur.
          The Company considers the following factors in evaluating whether
          recovery  is probable:   the customer s  written approval  of the
          scope  and/or  price  of   the  change  order,  the  objectivity,
          verifiability,  and   reasonableness  of   underlying  accounting
          documentation   for  change   order  costs,  and   the  Company s
          experience in negotiating change orders in similar instances.  

               The  following guidelines  are  followed by  the Company  in
          accounting for change orders whose scope and price, but not both,
          have not been approved by the customer.

               A.  Costs directly attributable to change orders whose scope
                   and/or price is not determinable are charged directly to
                   operations in the period in which the costs are incurred
                   if  it is not probable  that the costs will be recovered
                   through a change in the contract price.<PAGE>





                                    KIMMINS CORP.

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          1.   Organization and summary of 
               significant accounting policies (continued)


               B.  If  it  is  probable that  the costs  will  be recovered
                   through a  change in  the contract price, the  costs are
                   treated as  costs of contract performance  in the period
                   in  which  they are  incurred  and  contract revenue  is
                   recognized to the extent of  the costs incurred.   Costs
                   incurred  in  excess of  amounts  that  are probable  of
                   recovery  are   charged  directly  to  operations   when
                   incurred.


               C.  In the  case of  change orders  that are approved  as to
                   scope  but  not  price, profit  recognition  is deferred
                   until receipt of the priced change order.

               Contract claims are amounts  incurred by the Company related
          to  contract changes  that are  unapproved as  to both  scope and
          price, or are directly disputed or contested as to either, by the
          customer.  Claims  are amounts in  excess of the  agreed contract
          price (or  amounts not included  in the original  contract price)
          that are  due to customer-caused delays,  errors in specification
          and   designs,  contract   terminations,   or  other   causes  of
          unanticipated additional costs.   The Company recognizes contract
          revenue relating to  claims to the  extent of its  costs incurred
          only if it is  probable that the claim will result  in additional
          contract revenue  and  if  the  amount of  contract  revenue  and
          related  costs can be reliably estimated.  Those two requirements
          are   satisfied  by  the  existence   of  all  of  the  following
          conditions:

               A.  The  contract  or   other  applicable  legal  principles
                   provides a legal basis for the claim; or a legal opinion
                   has been obtained, stating  that the Company is entitled
                   to  recover   amounts  under   the  contract   or  other
                   applicable legal principles.

               B.  Additional  costs are caused by  circumstances that were
                   unforeseen  at the contract date and  are not the result
                   of deficiencies in the contractor s performance.

               C.  Costs incurred  by the Company that  are associated with
                   the claim are identifiable and reasonable in view of the
                   work performed.

               D.  The evidence  supporting  the  claim  is  objective  and
                   verifiable.<PAGE>





                                    KIMMINS CORP.

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          1.   Organization and summary of 
               significant accounting policies (continued)

               Except  in rare circumstances,  claim preparation  and legal
          costs are expensed as incurred.  Exceptions include  instances in
          which  the contract document provides for their recovery or legal
          costs  are  incurred  to  pursue approved  settlements  by  court
          ruling,  binding arbitration,  and otherwise.   In  all instances
          where such amounts are recorded, it is  probable that the amounts
          associated  with  claim  preparation  and  legal  costs  will  be
          recovered.   As  of December  31, 1995  and 1996,  $1,226,000 and
          $295,000, respectively, of the  claim preparation and legal costs
          were deferred.

               Fees arising from services other than contracting activities
          are recognized when the negotiated services are provided.

               Stock based compensation -  The Company grants stock options
          for a fixed number of shares  to employees with an exercise price
          equal to the fair value  of the shares at the date of  grant. The
          Company  accounts  for stock  option  grants  in accordance  with
          Accounting Principles Board Opinion No. 25, "Accounting for Stock
          Issued to Employees" ("APB No. 25"), and, accordingly, recognizes
          no compensation expense for the stock option grants.

               In October  1995, the  Financial Accounting  Standards Board
          ("FASB") issued  Statement No. 123 ("SFAS  No. 123"), "Accounting
          and  Disclosure of  Stock-Based Compensation,"  which encourages,
          but  does not require, companies to  recognize stock awards based
          on their  fair value at the  date of grant.   Unaudited pro forma
          financial information, assuming that  the Company had adopted the
          measurement  standards  of  SFAS   No.  123,  was  considered  by
          management to be immaterial for separate presentation.

               Earnings per share - Earnings  per common share are computed
          based on the weighted  average number of shares  outstanding. Any
          shares  of Class B common stock  that are eligible for conversion
          (none  for  1994,  1995, and  1996)  would  be  included  in  the
          computation  of earnings per share to  the extent that they would
          be  dilutive.   The  effect of  common stock  equivalents  is not
          material.

               Accounting  standard  -   In  February  1997,  FASB   issued
          "Statement of Financial Accounting  Standards No. 128,  "Earnings
          per Share" ("FAS No. 128"), which is effective for periods ending
          after December  15, 1997.   This statement  establishes standards
          for computing and presenting earnings per share data.  Management
          is currently assessing the impact of FAS No. 128 on the Company's
          presentation of earnings per share data in future periods.<PAGE>





                                    KIMMINS CORP.

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          1.   Organization and summary of 
               significant accounting policies (continued)

               Statements of cash flows - 

                                          Years ended December 31,         
                                  ----------------------------------------
                                      1994          1995          1996     
                                  ------------  ------------  -------------
               Cash paid:                       
                Interest  . . . . $  2,007,000  $  2,423,000  $  3,524,000 
                Income taxes  . . $    499,000  $  1,453,000  $     28,000 

          2.   Business acquisitions

               On  February 21,  1996, Kimmins  Recycling Corp.  ("KRC"), a
          wholly-owned subsidiary  of the Company,  acquired certain assets
          from Automated Resource Recovery,  Inc., for $300,000 relating to
          its solid waste management operations.  This acquisition has been
          accounted  for  under  the  purchase method  of  accounting  and,
          accordingly, the purchase price has  been allocated to the assets
          acquired (approximately  $150,000)  based on  the estimated  fair
          values at the date of acquisition.  The purchase price associated
          with  the  acquisition  exceeded   the  net  assets  acquired  by
          approximately $150,000, which was  assigned to intangible assets,
          including customer lists.   The operating results associated with
          this  business  acquisition   are  included   in  the   Company's
          consolidated  results of  operations from  February 22,  1996, to
          December 31, 1996.

               On  May 31,  1996,  KRC acquired  certain assets  from Paper
          Stock Dealers,  Inc., for  $200,000 relating to  its solid  waste
          management operations.   This acquisition has  been accounted for
          under  the purchase  method of  accounting and,  accordingly, the
          purchase  price  has  been   allocated  to  the  assets  acquired
          (approximately $112,000)  based on  the estimated fair  values at
          the date of acquisition.  The purchase price associated  with the
          acquisition  exceeded  the net  assets acquired  by approximately
          $88,000,  which was  assigned to  intangible  assets, principally
          customer  lists.   The  operating  results  associated with  this
          business acquisition  are included in the  Company s consolidated
          results of operations from June 1, 1996, to December 31, 1996.

               On March  31, 1995, KRC acquired certain  assets from County
          Sanitation,  Inc., for  $2,267,000  relating to  its solid  waste
          management operations.   This acquisition has  been accounted for
          under  the purchase  method of  accounting and,  accordingly, the
          purchase  price  has  been   allocated  to  the  assets  acquired
          (approximately $1,415,000) based on the estimated fair values at<PAGE>





                                    KIMMINS CORP.

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          2.   Business acquisitions (continued)

          the date of acquisition.   The purchase price associated with the
          acquisition  exceeded the  net  assets acquired  by approximately
          $852,000,  which was  assigned  to  intangible assets,  including
          goodwill.   The operating  results associated with  this business
          acquisition are included in the Company's consolidated results of
          operations from April 1, 1995, to December 31, 1995.

               The unaudited pro  forma results of operations for  the year
          ended  December  31,  1995,  assumes the  acquisition  of  County
          Sanitation, Inc.,  had been  consummated as  of January  1, 1995.
          The pro  forma  effects of  Automated Recovery,  Inc., and  Paper
          Stock  Dealers,  Inc.,  were   considered  by  management  to  be
          immaterial  for purposes  of pro  forma presentation.   Pro forma
          results  of  operations are  not  necessarily  indicative of  the
          results that would have occurred if  County Sanitation, Inc., had
          been acquired at the beginning of the period.

                                                               Year ended
                                                              December 31,
                                                                  1995
                                                              -------------
               Revenue  . . . . . . . . . . . . . . . . . . . $112,276,000 
               Net income (loss)  . . . . . . . . . . . . . . $  1,348,000 
               Net income (loss) per common share . . . . . . $        .30 

          3.   Related party transactions

               During 1994, 1995, and 1996, the  Company paid landfill fees
          of approximately $28,000, $88,000, and $139,000, respectively, to
          a company that is primarily owned by the brother of the Company's
          President. The amounts paid approximated the fair market rate for
          the type of services involved.

               The  Company's  President   and  majority  stockholder  also
          controls  Cumberland, a property  and casualty  insurance company
          that provides  insurance for  specialty sureties  and performance
          and  payment  bonds  for  contractors.  Through  Cumberland,  the
          Company has obtained performance  and payment bonds in connection
          with certain  of its contracts  and projects.  The fees that  the
          Company paid for  these services for the years ended December 31,
          1994,  1995 and  1996,  were approximately  $14,000, $5,000,  and
          $2,900,  respectively  (see  Footnote  7  of  the  Notes  to  the
          Consolidated Financial Statements).<PAGE>





                                    KIMMINS CORP.

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          4.   Accounts receivable
                                                       December 31,        
                                                ---------------------------
                                                    1995          1996     
                                                ------------- -------------
               Contract and trade:              
                Billed contract receivables:    
                  Completed and uncompleted     
                   contracts  . . . . . . . . . $ 12,522,949  $ 12,104,803 
                  Retainage . . . . . . . . . .    3,916,769     3,576,869 
                Unbilled contract receivables .      805,500       353,708 
                Trade receivables   . . . . . .    4,907,334     4,641,497 
                                                ------------- -------------
               Less allowance for doubtful        22,152,552    20,676,877 
                accounts  . . . . . . . . . . .     (397,211)     (616,708)
                                                ------------- -------------
                                                $ 21,755,341  $ 20,060,169 
                                                ============= =============

               All   unbilled  receivables  relate  to  work  performed  or
          material shipped by the balance sheet date and are billed as soon
          as is administratively feasible.

               The Company has a note  receivable in an original amount  of
          $3,638,696  from Sunshadow  Apartments,  Ltd.,  and  Summerbreeze
          Apartments, Ltd.,  two Florida  real estate limited  partnerships
          (collectively, the "Apartments").  The note receivable originally
          accrued interest at prime plus 1.375 percent, increasing to prime
          plus 2  percent  on July  1, 1995,  with  principal and  interest
          payable in monthly installments through December 31, 1998, and is
          guaranteed  by  Mr. Williams.  The  Company did  not  receive any
          interest or principal payments during  1996 relating to this note
          receivable,  and  management  of  the  Company  has  discontinued
          recognition of interest income  of approximately $551,000 for the
          year.   Amounts due from the Apartments  at December 31, 1995 and
          1996, are approximately $3,851,000.

               At  December 31, 1995  and 1996, $5,301,000  of the combined
          accounts receivable - affiliates  and note receivable - affiliate
          balances  are  due from  corporate  affiliates  of the  Company's
          President. The affiliated receivables relate to contract services
          performed and are guaranteed by Mr. Williams.<PAGE>





                                    KIMMINS CORP.

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          5.   Costs and estimated earnings in excess of 
               billings on uncompleted contracts

                                                       December 31,        
                                                ---------------------------
                                                    1995          1996     
                                                ------------- -------------
                                                
               Expenditures on uncompleted      
                contracts   . . . . . . . . . . $ 67,391,021  $ 76,218,248 
               Estimated earnings on            
                uncompleted contracts . . . . .    7,456,516     4,490,748 
                                                ------------- -------------
                                                  74,847,537    80,708,996 
               Less actual and allowable        
                billings on uncompleted         
                contracts . . . . . . . . . . .   58,452,865    65,493,411 
                                                ------------- -------------
                                                $ 16,394,672  $ 15,215,585 
                                                ============= =============
               Costs and estimated earnings in  
                excess of billings on           
                uncompleted contracts . . . . . $ 17,001,286  $ 15,967,872 
                                                
               Billings in excess of costs and   
                estimated earnings on           
                uncompleted contracts . . . . .     (606,614)     (752,287)
                                                ------------- -------------
                                                $ 16,394,672  $ 15,215,585 
                                                ============= =============

               During  the years ended  December 31, 1994,  1995, and 1996,
          the   Company  recognized   revenue  from   contract  claims   of
          approximately $1,198,000, $1,624,000, and $38,000,  respectively.
          During  1996,  the  Company  agreed  to  a  settlement  agreement
          relating to  a contract claim that resulted  in a pre-tax loss of
          approximately $448,000  and  revised its  estimate regarding  the
          collectibility of several claims that  resulted in a pre-tax loss
          of approximately  $883,000.  In addition,  subsequent to December
          31, 1996,  the Company received  a judge s  decision regarding  a
          previous  jury award, resulting in a pre-tax charge to operations
          of approximately  $1,572,000.   During 1995, the  Company settled
          two contract claims that resulted in a  net gain of approximately
          $473,000. <PAGE>





                                    KIMMINS CORP.

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          5.   Costs and estimated earnings in excess of 
               billings on uncompleted contracts (continued)

               As  of December 31,  1995 and 1996,  the costs and estimated
          earnings in excess of  billings on uncompleted contracts includes
          the  Company's  cost  associated  with  unapproved  or   disputed
          contract  change  orders  and  costs claimed  from  customers  on
          completed contracts of  $11,787,000 and $8,950,000, respectively.
          During   the   performance  of   these  contracts,   the  Company
          encountered    site   conditions    that   differed    from   bid
          specifications. As  a  result, the  Company  incurred  additional
          labor and  equipment costs in  performing the contract.  By their
          nature, recovery of these amounts is often subject to negotiation
          with  the  customer and,  in  certain  cases, resolution  through
          litigation. As a result, the recovery of these amounts may extend
          beyond one year.

          6.    Property and equipment
                                                       December 31,        
                                                ---------------------------
                                                    1995          1996     
                                                ------------- -------------
                                                
               Land . . . . . . . . . . . . . . $  5,067,437  $  5,622,769 
               Buildings and improvements . . .    7,317,544     7,909,361 
               Construction and recycling 
                equipment . . . . . . . . . . .   42,340,792    47,143,128
               Furniture and fixtures . . . . .    1,468,600     1,508,105
               Construction in progress . . . .      615,846        33,463
                                                ------------- -------------
                                                  56,810,219    62,216,826 
               Less accumulated depreciation. .  (19,217,558)  (23,339,305)
                                                ------------- -------------
                                                $ 37,592,661  $ 38,877,521 
                                                ============= =============

               Property and equipment is  recorded at cost. Depreciation is
          provided  using the  straight-line method  over estimated  useful
          lives  ranging from  3  to  30  years. Depreciation  expense  was
          $3,890,000,  $4,038,000,  and  $5,219,000  for  the  years  ended
          December 31, 1994, 1995 and  1996, respectively.  Construction in
          progress will be depreciated  over the estimated useful  lives of
          respective assets when placed into service.<PAGE>





                                    KIMMINS CORP.

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          7.   Term note from affiliate/
               Investment in Cumberland Technologies, Inc.

               In 1988, Cumberland Casualty & Surety Company ("CCS") issued
          a  surplus debenture  to the  Company that  bears interest  at 10
          percent per  annum  in exchange  for  $3,000,000. In  1992,  such
          debenture   was   assigned  to   Cumberland   Technologies,  Inc.
          ("Cumberland"),  a  holding company  that  provides, among  other
          services, reinsurance for specialty sureties  and performance and
          payment bonds for  contractors.  Cumberland  entered into a  term
          note agreement with the Company for the outstanding amount of the
          debenture, including  accrued interest.  Interest  accrued on the
          term  note was $506,755  at December  31, 1995 ($372,066  in 1996
          prior to the conversion discussed below).

               On November 5, 1996,  the Company received 1,723,290 shares,
          or 30  percent  of the  outstanding common  stock, of  Cumberland
          common stock in exchange for  the term note from affiliate.   The
          Cumberland  common stock  had a  fair market  value of  $3.00 per
          share on the date  of the exchange, based upon  the quoted market
          price.  This investment is accounted for under the equity method.
          At December 31, 1996,  the market value of the  Cumberland common
          stock held by the Company was approximately $5,170,000.

               The following  is  a summary  of the  financial position  at
          December 31, 1996,  and results of  operations of Cumberland  for
          the period November 5, 1996, through December 31, 1996:

                                                              December 31,
                                                                  1996     
                                                              -------------
          
               Cash and cash equivalents  . . . . . . . . . . $    669,000 
               Investments  . . . . . . . . . . . . . . . . .    6,110,000 
               Accounts receivable - trade, net . . . . . . .      906,000 
               Intangibles  . . . . . . . . . . . . . . . . .    1,957,000 
               Other  . . . . . . . . . . . . . . . . . . . .    2,127,000 
                                                              -------------
                Total assets  . . . . . . . . . . . . . . . . $ 11,769,000 
                                                              =============
               Policy liabilities and accruals  . . . . . . . $  3,854,000 
               Long-term debt . . . . . . . . . . . . . . . .    1,533,000 
               Other  . . . . . . . . . . . . . . . . . . . .      569,000 
                                                              -------------
                Total liabilities   . . . . . . . . . . . . . $  5,956,000 
               Stockholders  equity . . . . . . . . . . . . .    5,813,000 
                                                              -------------
                Total liabilities and stockholders  equity  . $ 11,769,000 
                                                              =============<PAGE>





                                    KIMMINS CORP.

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          7.   Term note from affiliate/
               Investment in Cumberland Technologies, Inc. (continued)

               Cumberland s   operating   results   included   revenue   of
          $1,727,000  and a net loss of  $117,000 during the period in 1996
          that  the Company carried  its equity investment.   The equity in
          this net loss  amounted to $37,000.   In addition,  approximately
          $27,000  of  amortization expense  was  recorded  by the  Company
          related to the investment.

          8.   Accrued expenses
                                                       December 31,        
                                                ---------------------------
                                                    1995          1996     
                                                ------------- -------------
                                                
               Deferred revenue . . . . . . . . $  1,858,148  $  1,641,857 
               Accrued insurance  . . . . . . .    3,130,582     3,608,350 
               Accrued disposal costs . . . . .      846,606       744,229 
               Accrued interest . . . . . . . .      118,332       270,133 
               Accrued real estate taxes  . . .      332,725       441,566 
               Other  . . . . . . . . . . . . .      762,739     1,366,052 
                                                ------------- -------------
                                                $  7,049,132  $  8,072,187 
                                                ============= =============<PAGE>





                                    KIMMINS CORP.

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          9.   Long-term debt
                                                       December 31,        
                                                ---------------------------
                                                    1995          1996     
                                                ------------- -------------
               Notes payable, principal and     
                interest payable in monthly     
                installments through March 1,
                2001, interest at varying rates
                up to 13 percent,
                collateralized by equipment . . $ 19,615,486  $ 19,548,486
               Revolving term bank line of      
                credit, $12,390,000 ($5,000,000 
                during 1995), maximum, due July
                31, 1999, interest payable
                monthly at lender s base rate
                plus .5 percent, permanent
                quarterly principal reductions
                of $250,000 begin on July 1,
                1997  . . . . . . . . . . . . .    3,292,607    11,190,002 
               Bank note payable, varying       
                principal and interest payments 
                through August 1, 1996,
                interest at prime plus 1.75
                percent, collateralized by
                equipment . . . . . . . . . . .    1,500,000         -
               Mortgage notes, principal and    
                interest payable in monthly     
                installments through October 1,
                2010, interest at varying rates
                up to prime plus 1 3/4 percent,
                collateralized by land and
                buildings . . . . . . . . . . .    5,886,733     6,976,756
               Mortgage notes - $500,000 with   
                related parties, interest       
                payable in quarterly
                installments at 10 percent,
                plus a performance based return
                not to exceed 6 percent,
                principal due January 9, 1997,
                collateralized by land and
                buildings   . . . . . . . . . .    1,400,000         -   
                                                ------------- -------------
                                                  31,694,826    37,715,244 
               Less current portion . . . . . .    7,074,857     7,794,848 
                                                ------------- -------------
                                                $ 24,619,969  $ 29,920,396 
                                                ============= =============<PAGE>





                                    KIMMINS CORP.

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          9.   Long-term debt (continued)


               Annual principal maturities subsequent to December 31, 1996,
               are as follows:
          
               1997 . . . . . . . . . . . . . . . . . . . . . $  7,794,848 
               1998 . . . . . . . . . . . . . . . . . . . . .   12,615,882 
               1999 . . . . . . . . . . . . . . . . . . . . .   12,269,747 
               2000 . . . . . . . . . . . . . . . . . . . . .    2,022,111 
               2001 . . . . . . . . . . . . . . . . . . . . .      818,412 
               Thereafter . . . . . . . . . . . . . . . . . .    2,194,244 
                                                              -------------
                                                              $ 37,715,244 
                                                              =============

               The lenders' prime rate under the bank line at both December
          31, 1995  and 1996, was 8.5 percent.  At December 31, 1996, there
          was approximately  $1,200,000 of borrowings  available under  the
          revolving  term  bank  line  of  credit.  The  Company  was  also
          contingently  liable  for letters  of  credit  in the  amount  of
          approximately $2,610,000 at December 31, 1996.

               The revolving term  bank line of $12,390,000  and the letter
          of credit facility of $2,610,000  are secured by a pledge of  all
          of  the stock of the Company's  subsidiaries, the Cumberland term
          note,  and substantially all of the assets of Kimmins. The use of
          funds under  these lines  is limited among  certain subsidiaries,
          and repayment is guaranteed by Cumberland.

               The  debt  agreements  contain certain  covenants,  the most
          restrictive  of  which  require  maintenance  of  a  consolidated
          tangible net worth,  as defined,  of not  less than  $15,900,000,
          maintenance of a debt to consolidated tangible net worth ratio of
          no more than 3.5 to 1.0, consolidated debt service coverage ratio
          of at  least 1.0 to 1.0, and a fixed charge coverage ratio of not
          less than  1.0 to  1.0. In addition,  the covenants  prohibit the
          ability,  without   lender  approval,  of  the   Company  to  pay
          dividends. As of December 31, 1996, the Company was in compliance
          with or obtained waivers for  all loan covenants, and the Company
          may be required  to obtain similar waivers  for certain covenants
          in 1997.  The Company  has a representation  from Mr.  Francis M.
          Williams  should   waivers  not   be  obtained  and   the  lender
          accelerates the  maturities of  the Revolving Term  Bank Line  of
          Credit and  the  Mortgage  Note on  the  corporate  office.  This
          representation provides that Mr. Williams will lend the necessary
          funds  to the  Company, or  arrange for  the Company to  borrow a
          similar amount under similar terms and maturities so that the<PAGE>





                                    KIMMINS CORP.

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          9.   Long-term debt (continued)


          Company is not required to pay any principal payments during 1997
          more than the regularly scheduled maturities.

               Subsequent to December 31,  1996, Kimmins Contracting  Corp.
          ("KCC"), a  wholly-owned subsidiary of the  Company, entered into
          two separate debt agreements.  KCC converted equipment previously
          rented  under   operating  leases  into  an   equipment  note  of
          approximately $13  million under  terms similar to  the Company s
          other equipment notes outstanding.  In  addition, KCC obtained an
          $11 million working capital loan, of which $7 million was used to
          reduce  the Company s  outstanding  revolving term  bank line  of
          credit during March 1997.

          10.  Employee Stock Ownership Plan Trust Debt

               In March  1990, the Company's Employee  Stock Ownership Plan
          Trust ("ESOP") (Note 13) originally was funded from  a $5,100,000
          loan. This  loan was  refinanced during December  1995 and  bears
          interest at prime  plus .5 percent, with quarterly principal  and
          monthly  interest  payments through  October  2000.  The loan  is
          guaranteed by the Company as to payment of principal and interest
          and, therefore, the unpaid balance of the borrowing is  reflected
          as  debt  of  the  Company.  An  equivalent  amount  representing
          unearned  employee  compensation,  less  the   Company's  accrued
          contribution  (Note   12),  is  recorded  as   a  deduction  from
          stockholders' equity.

               Annual principal maturities for each  of the next four years
          are as follows:
          
               1997 . . . . . . . . . . . . . . . . . . . . . $    480,000 
               1998 . . . . . . . . . . . . . . . . . . . . .      480,000 
               1999 . . . . . . . . . . . . . . . . . . . . .      480,000 
               2000 . . . . . . . . . . . . . . . . . . . . .      480,000 
                                                              -------------
                                                              $  1,920,000 
                                                              =============

          11.  Leasing arrangements

               The Company rents equipment and machinery as needed, as well
          as office space, under operating  leases for varying periods  not
          to  exceed one year. Rental expense  for the years ended December
          31,   1994,  1995,  and   1996,  was   approximately  $9,500,000,
          $9,079,000, and $11,808,000, respectively.<PAGE>





                                    KIMMINS CORP.

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          12.  Pension and other benefit plans 

               Employee  Stock  Ownership Plan.  On  January  1, 1989,  the
          Company, for  the benefit  of its employees,  formed the  ESOP to
          purchase shares of  the Company's common stock from  time to time
          in the open market or in negotiated transactions at prices deemed
          to  be attractive.  Contributions to  the  ESOP are  made at  the
          discretion  of the  Board  of Directors.  During  1989, the  ESOP
          acquired from  the Company's  President 257,371 shares  of common
          stock  at a  cost  of  $5,100,000. The  shares  were acquired  in
          exchange  for   a  note  payable  to   the  Company's  President.
          Simultaneous   with  this   purchase,  the   Company's  President
          purchased   certain   receivables   and  interests   in   certain
          investments from the Company for a purchase  price of $5,100,000,
          which  was paid  by the  assignment to  the Company  of  the note
          received  from the  ESOP. The  note originally was  funded during
          March  1990,   through  a  long-term  bank   financing  agreement
          guaranteed  by the  Company (Note  10).  As the  debt is  repaid,
          shares  are  released from  collateral  and  allocated to  active
          employees, based  on the proportion  of debt service paid  in the
          current  year. Debt  of the  ESOP is  recorded as  debt, and  the
          shares pledged  as collateral  are reported as  unearned employee
          compensation  in  the  balance  sheet.  For  financial  statement
          purposes, as of December 31, 1995 and 1996, the unearned employee
          compensation  (net  of  accrued  contributions  of  approximately
          $133,000 and  $0, respectively) was  reflected as a  reduction in
          stockholders' equity.

               Interest and compensation expenses  relating to the ESOP are
          as follows:

                                          Years ended December 31,         
                                  -----------------------------------------
                                      1994          1995          1996     
                                  ------------- ------------- -------------
                                                
               Interest . . . . . $    274,519  $    354,449  $    185,728 
               Compensation . . . $    615,657  $    504,852  $    467,082 <PAGE>





                                    KIMMINS CORP.

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          12.  Pension and other benefit plans (continued)

               The ESOP shares were as follows:
                                                       December 31,        
                                                ---------------------------
                                                    1995          1996     
                                                ------------- -------------
               Allocated shares . . . . . . . .      135,000       159,000 
               Shares released for allocation .        -             -     
               Unreleased shares  . . . . . . .      120,000        96,000 
                                                ------------- -------------
               Total ESOP shares  . . . . . . .      255,000       255,000 
                                                ============= =============
               Market value of unreleased      
                shares  . . . . . . . . . . . . $    900,500  $    324,000 
                                                ============= =============

               Stock Option Plan. The  Company originally reserved  288,400
          shares  of its  common stock  for issuance  upon the  exercise of
          options  to be granted under the Company's 1987 Stock Option Plan
          (the Company  Plan). The  exercise  price of  an incentive  stock
          option granted under  the Company Plan may  not be less than  the
          fair market value of the  common stock at the time the  option is
          granted.  The  exercise price  of  a  non-qualified stock  option
          granted  under the Company Plan  may be any  amount determined by
          the  Board of Directors  but not less  than the par  value of the
          common stock on the date of  the grant. Options granted under the
          Company Plan must,  in general,  expire no later  than ten  years
          from the date of the grant.

               The  Company s 1987  Stock  Option Plan  has  the option  to
          acquire an aggregate  of 288,400 shares of common  stock that may
          be granted  to employees, officers, directors  and consultants of
          the Company.   The  Plan authorizes the  Board of  Directors (the
          "Board") to issue incentive stock options ("ISOs"), as defined in
          Section 422A(b) of  the Internal Revenue Code,  and stock options
          that  do not  conform to  the requirements  of that  Code section
          ("Non-ISOs").  The Board has discretionary authority to determine
          the types of stock options to be granted, the persons among those
          eligible to whom options will be granted, the number of shares to
          be subject to  such options, and  the terms  of the stock  option
          agreements.   Options may be exercised  in the manner and at such
          times as fixed by the  Board, but may not be exercised  after the
          tenth anniversary of the grant of such options.<PAGE>





                                    KIMMINS CORP.

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          12.  Pension and other benefit plans (continued)

               The  following table  summarizes  the  transactions for  the
          three years ended December 31, 1996, relating to the Plan:

                                                 Number of     Per Share
                                                   Shares     Option Price 
                                                ------------ ---------------
                                                
               Outstanding January 1, 1994: . .     206,143  $3.33 - $13.74
                Granted   . . . . . . . . . . .     182,643  $         4.50
                Exercised   . . . . . . . . . .       -      $         -   
                Canceled  . . . . . . . . . . .    (183,643) $6.00 - $13.74
                                                ------------
               Outstanding December 31, 1994: .     205,143  $3.33 - $ 4.50
                Granted   . . . . . . . . . . .       7,500  $         4.50
                Exercised   . . . . . . . . . .      (4,400) $         4.50
                Canceled  . . . . . . . . . . .       -      $       -     
                                                ------------
               Outstanding December 31, 1995: .     208,243  $3.33 - $ 4.50
                Granted   . . . . . . . . . . .       -      $       -     
                Exercised   . . . . . . . . . .       -      $       -     
                Canceled  . . . . . . . . . . .     (51,167) $ 3.33 - $4.50
                                                ------------
               Outstanding December 31, 1996: .     157,076  $ 3.33 - $4.50
                                                ============
               Exercisable December 31, 1996: .      91,586 
                                                ============

               Pro  forma  information  regarding  net  income  (loss)  and
          earnings  per  share is  required  by Statement  123,  which also
          requires that the information be determined as if the Company had
          accounted for  its employee  stock options granted  subsequent to
          December 31, 1993, under the fair value method of that Statement.
          The  fair value for  these options was  estimated at  the date of
          grant  using  a  Black-Scholes  option  pricing  model  with  the
          following weighted-average  assumptions for 1994, 1995  and 1996;
          risk-free interest  rates of  5.5 percent;  a  dividend yield  of
          zero;  volatility factors  of the  expected market  price of  the
          Company s  common  stock  based   on  historical  trends;  and  a
          weighted-average expected life of the options of seven years.

               The Black-Scholes  option valuation model was  developed for
          use in  estimating the fair value of  traded options that have no
          vesting restrictions  and are fully transferrable.   In addition,
          option valuation  models require  the input of  highly subjective
          assumptions  including  the  expected  stock   price  volatility.
          Because the Company s employee stock options have characteristics<PAGE>





                                    KIMMINS CORP.

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          12.  Pension and other benefit plans (continued)

          significantly different from those  of traded options and because
          changes in the subjective input assumptions can materially affect
          the fair  value estimate,  in management s opinion,  the existing
          models do not  necessarily provide a  reliable single measure  of
          the fair value of its employee stock options.

               The  pro forma  effect  of compensation  expense related  to
          outstanding stock options  on net income (loss) and  earnings per
          share were considered by management to be immaterial for purposes
          of pro forma presentation.

               Multi-Employer Defined Contribution  Plan. The Company makes
          payments  to   collectively  bargained,  multi-employer   defined
          contribution plans  covering Company  union employees. Under  the
          Multi-Employer Pension Plan Amendment Act, a withdrawing employer
          is required to  continue funding its share of the plan's unfunded
          vested  benefits.   The  Company  does   not  possess  sufficient
          information  to  determine its  portion  of  the unfunded  vested
          benefits, if any. Contributions to such plans for the years ended
          December 31, 1994, 1995, and 1996, were not significant.

          13.   Income taxes

               In February  1992, the Financial Accounting  Standards Board
          issued   Statement  of   Financial   Accounting  Standards   109,
          "Accounting  for Income  Taxes."  Under the  asset and  liability
          method  required  by  Statement  109,  deferred  tax  assets  and
          liabilities  are  recognized  for  the  future  tax  consequences
          attributable  to  differences  between  the  financial  statement
          carrying  amounts of  existing assets  and liabilities  and their
          respective  tax bases.  Deferred tax  assets and  liabilities are
          measured using  enacted tax  rates expected to  apply to  taxable
          income  in the  years in  which those  temporary  differences are
          expected to  be recovered  or settled.  Under Statement  109, the
          effect on deferred tax assets and  liabilities of a change in tax
          rates is recognized  in income  in the period  that includes  the
          enactment date.

               For  the year ended December 31,  1996, the Company incurred
          net  operating  losses  ("NOL")   for  federal  tax  purposes  of
          approximately  $11,200,000.    The  NOL  consists  of  $9,350,000
          generated by  the Company and approximately  $1,850,000 generated
          by  TransCor,   which  files  separately   as  explained   below.
          Approximately $4,500,000 of the federal NOL will be carried  back
          to  prior  tax  years,  resulting in  approximately  $900,000  of
          refunds, of which $600,000 is attributable to the Company and the
          remaining $300,000 to TransCor.  After the carryback,<PAGE>





                                    KIMMINS CORP.

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          13.  Income taxes (continued)

          approximately $6,700,000  is available  as a NOL  carryforward to
          future periods.   The loss carryforward expires in  the year 2011
          if  not  used.   The  deferred  tax  assets include  a  valuation
          allowance  of  approximately  $1,700,000  as  an  offset  to  the
          expected future  benefit of the NOL  carryforward attributable to
          the Company due to the uncertainty of realizing the benefit.  For
          alternative minimum tax ("AMT") purposes, the NOL carryforward is
          approximately  $6,200,000.    The Company  also  has  alternative
          minimum  tax  credit  carryforwards  of   approximately  $836,000
          available to reduce future federal regular income taxes.  The AMT
          credit carryforwards do not expire.

               As a result of TransCor's sale of its common stock  in March
          1993, it is  no longer consolidated  with the Company  for income
          tax  purposes. The  Company  has provided  deferred income  taxes
          respect  to  differences  between  its  book  and  tax  basis  in
          TransCor.  These differences  result from  income  recognized for
          book,  not  tax,  for  the  gain  on  the  sale of  TransCor  and
          TransCor's   post-offering  earnings,   which  are   collectively
          referred  to as  the outside basis  difference. The  rate used to
          provide taxes on  the outside basis  difference is the  statutory
          rate for the first  $785,000 that represents the Company's  share
          of TransCor's accumulated deficit at the date of  the sale of its
          common stock. The rate  for the remaining difference  assumes the
          dividend  received  deduction  because  the  Company  expects  to
          recover its investment through dividends.<PAGE>





                                    KIMMINS CORP.

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          13.  Income taxes (continued)

               Deferred  income  taxes  reflect  the  net  tax  effects  of
          temporary differences between the  carrying amounts of assets and
          liabilities for financial reporting purposes and the amounts used
          for income tax purposes.  Significant components of the Company's
          deferred tax liabilities and assets are as follows:

                                                       December 31,        
                                                ---------------------------
                                                    1995          1996     
               Deferred tax assets:             ------------- -------------
                                                
                Net operating loss              
                  carryforward  . . . . . . . . $      -       $ 2,598,970 
                Valuation allowance   . . . . .        -        (1,707,009)
                Allowance for doubtful          
                  accounts  . . . . . . . . . .      152,222       236,903 
                Costs deferred for tax          
                  expensed for books  . . . . .      154,553       210,556 
                Alternate minimum tax credit    
                  carryforwards . . . . . . . .      299,172       836,430 
                Accrued workers                 
                  compensation  . . . . . . . .      750,552       907,782 
                State tax credit                
                  carryforward  . . . . . . . .        -            32,730 
                Other   . . . . . . . . . . . .       56,721       194,293 
                                                ------------- -------------
                                                   1,413,220     3,310,655 
                                                ------------- -------------
               Deferred tax liabilities:
                                                
                Excess of tax over book         
                  depreciation  . . . . . . . . $  3,842,918   $ 4,704,561 
                Uncompleted long-term           
                  contracts . . . . . . . . . .      655,975       323,798 
                Costs deferred for book         
                  expensed for tax  . . . . . .      301,250       337,390 
                Outside basis difference in     
                  TransCor  . . . . . . . . . .      430,478       605,182 
                                                ------------- -------------
                                                   5,230,621     5,970,931 
                                                ------------- -------------
               Net deferred tax liability . . .    3,817,401     2,660,276 
               Less current net deferred        
                asset   . . . . . . . . . . . .      742,130     1,499,329 
                  Net non-current deferred      ------------- -------------
                   liability  . . . . . . . . . $  4,559,531  $  4,159,605 
                                                ============= =============<PAGE>





                                    KIMMINS CORP.

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          13.  Income taxes (continued)

               Factors causing the  effective tax rate  to differ from  the
               statutory rate are as follows:

                                               Years ended December 31,   
                                             -----------------------------
                                               1994      1995       1996  
                                             --------- --------- ---------
                                                       
               Federal statutory rate . . .     35.0%     34.0%    (34.0%)
               Valuation allowance  . . . .      0.0%      0.0%     15.9% 
               State income taxes . . . . .      7.5%     10.0%     (3.5%)
               Additional tax on the                   
                Company's shares of                    
                TransCor's earnings . . . .      4.0%      8.0%      2.3%
               Other  . . . . . . . . . . .      1.5%      0.6%     (0.2%)
                                             --------- --------- ---------
               Effective tax rate . . . . .      48.0%     52.6%   (19.5%)
                                             ========= ========= ========= 

          14.   Stockholders' equity

               The Company's  Class  B common  stock  has the  same  voting
          rights as common stock and is not entitled to participate in cash
          dividends. Upon  liquidation or  dissolution of the  Company, the
          holders of  common stock are entitled to  receive up to $9.00 per
          share, after  which  the holders  of  Class  B common  stock  are
          entitled to receive up to $9.00 per share. Thereafter, all assets
          remaining  for distribution will  be distributed pro  rata to the
          holders of common  stock and Class B  common stock. The right  to
          convert Class B common stock to common stock occurs in any fiscal
          year in  which  the Company  achieves  net  earnings equal  to  a
          specified amount (currently $.84  per share), which is calculated
          by adding the total  shares outstanding at fiscal year end to the
          number of shares that could be converted  during the fiscal year.
          The holders of the Class B common stock  will thereafter have the
          right to convert  up to 625,000  shares of Class  B common  stock
          into common  stock on a  share for share  basis as follows.  Each
          cumulative incremental increase in net earnings in any subsequent
          year  of $.21  per share  above the  specified level  of earnings
          previously obtained will afford holders  the right to convert  up
          to  an additional  625,000 shares  of Class  B common  stock into
          common  stock on  a share  for  share basis.  Holders of  Class B
          common stock will not be entitled to convert more than 625,000 of
          such  shares  in  any fiscal  year  unless  the Company  achieves
          earnings of $1.44  per share of common stock in  any fiscal year,
          which will  entitle  holders to  convert all  shares  of Class  B
          common stock into common stock. No shares of Class B common stock<PAGE>





                                    KIMMINS CORP.

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          14.   Stockholders' equity (continued)

          became eligible for conversion into common stock during the years
          ended December 31, 1994, 1995, and 1996.

               The Company  has  authorized 1,000,000  shares of  preferred
          stock  with a  par value  of $.001,  none of  which is  presently
          outstanding. Such preferred  stock may  be issued  in series  and
          will have such designations, rights, preferences, and limitations
          as may be fixed by the Board of Directors.

          15.   Contingencies

               The Company is involved in  various legal actions and claims
          arising in the ordinary course of its business. After taking into
          consideration  legal counsel's  evaluation  of such  actions  and
          claims, management is of the opinion that  their outcome will not
          have  a material  adverse  effect on  the consolidated  financial
          position of the Company.

          16.   Fourth quarter adjustments (unaudited)

               During  the fourth  quarter  of 1996,  the Company  recorded
          certain  charges  to  operations  related  to  contract  estimate
          changes and  contract claim  and change  order settlements.   The
          aggregate effect of these charges  related to the Company s  pre-
          tax loss for 1996 amounted to approximately $6,452,000.
          
               During the fourth  quarter of 1995, the  Company refined its
          estimate of income  tax expense,  with an  additional expense  of
          $241,000. Also,  in  the  fourth  quarter of  1995,  the  Company
          capitalized certain contract costs. This refinement resulted in a
          credit to operations of $505,000 in the fourth quarter of 1995.

          17.   Fair value of financial instruments

               The  following  estimated  fair   value  amounts  have  been
          determined  using available  market  information and  appropriate
          valuation   methodologies.  However,  considerable   judgment  is
          necessarily required  in interpreting market data  to develop the
          estimates of  fair  value. Accordingly,  the estimates  presented
          herein  are not necessarily  indicative of  the amounts  that the
          Company  could realize in  a current market  exchange. The use of
          different market assumptions  and/or estimation methodologies may
          have a material effect on the estimated fair value amounts.<PAGE>





                                    KIMMINS CORP.

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          17.   Fair value of financial instruments (continued)

               Cash, accounts receivable, note  receivable - affiliate, and
          accounts  payable. The  carrying amount  reported in  the balance
          sheet  for  cash,  accounts   receivable,  and  accounts  payable
          approximates their fair value. 

               Long-term debt.  The fair values of  the Company's long-term
          debt are estimated using discounted cash flow analyses,  based on
          the Company's  current incremental  borrowing  rates for  similar
          types of borrowing arrangements.

               The  carrying  amounts  and  fair values  of  the  Company's
          financial instruments at December 31, 1996, are as follows:
     <TABLE>            
     <CAPTION>          
                             December 31, 1995           December 31, 1996      
                        --------------------------  ---------------------------
                           Carrying       Fair        Carrying         Fair
                            Amount        Value        Amount          Value    
                        ------------  ------------  ------------- -------------
     <S>                <C>           <C>           <C>           <C>
     Liabilities:                                   
      Notes payable  .  $ 31,694,826  $ 31,230,000  $ 37,715,244  $ 37,715,000 
      Employee Stock                                
        Ownership Plan                              
        Trust deby . .  $  2,400,000  $  2,400,000  $  1,920,000  $  1,920,000
     </TABLE>                                       

          18.   Business segments and major customers

               The  Company conducts  business in  two segments:  specialty
          contracting  services and  solid  waste management  services. The
          specialty  contracting  services segment  provides  comprehensive
          services   including   infrastructure  development,   underground
          utility construction, road work, dismantling, asbestos abatement,
          excavation, removal and disposal  of contaminated soil. The solid
          waste  management services  segment offers  collection, transfer,
          transportation, resource  recovery and disposal  of non-hazardous
          waste and demolition services.

               For the years  ended December 31,  1994, 1995 and  1996, the
          Company s  specialty  contracting services  segment  earned gross
          revenue  of approximately  $10,000,  $3,953,000 and  $14,884,000,
          respectively,  on  contracts  with   the  Florida  Department  of
          Transportation.<PAGE>





                                    KIMMINS CORP.

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          18.   Business segments and major customers (continued)

               A summary  of information  about the Company's  segments for
          the  years ended December 31, 1994, 1995  and 1996, is as follows
          (in thousands):
                                    Specialty    Solid Waste
                                   Contracting   Management
                    1994            Services      Services        Total    
          ----------------------- ------------- ------------- -------------
          Gross revenue . . . . . $     67,748  $     29,007  $     96,755 
                                  ============= ============= =============
          Operating income  . . . $      1,853  $        817  $      2,670 
          Interest income . . . .        1,060         -             1,060 
          Interest expense  . . .        1,590           547         2,137 
          Minority interest . . .        -               (61)         (61) 
          Income (loss) before    ------------- ------------- -------------
           income taxes   . . . . $      1,323  $      1,533  $        210 
                                  ============= ============= ============= 
          Identifiable assets . . $     42,448  $     30,241  $     72,689 
                                  ============= ============= ============= 
          Depreciation and                      
           amortization   . . . . $      2,157  $      1,893  $      4,050 
                                  ============= ============= ============= 
          Capital expenditures  . $      3,365  $      2,439  $      5,804 
                                  ============= ============= ============= 
                                                
                                    Specialty    Solid Waste
                                   Contracting   Management
                    1995            Services      Services        Total    
          ----------------------- ------------- ------------- -------------
          Gross revenue . . . . . $     70,227  $     41,119  $    111,346 
                                  ============= ============= ============= 
          Operating income  . . . $      1,892  $      2,704  $      4,596 
          Interest income . . . .        1,005         -             1,005 
          Interest expense  . . .        1,875           548         2,423 
          Minority interest . . .        -              (345)         (345)
          Income (loss) before    ------------- ------------- -------------
           income taxes   . . . . $      1,022  $      1,811  $      2,833 
                                  ============= ============= ============= 
          Identifiable assets . . $     46,778  $     46,851  $     93,629 
                                  ============= ============= ============= 
          Depreciation and                      
           amortization   . . . . $      1,855  $      2,447  $      4,302 
                                  ============= ============= ============= 
          Capital expenditures  . $      1,577  $     13,848  $     15,425 
                                  ============= ============= ============= 
                                                <PAGE>





                                    KIMMINS CORP.

                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          18.   Business segments and major customers (continued)

                                    Specialty    Solid Waste
                                   Contracting   Management
                    1996            Services      Services        Total    
          ----------------------- ------------- ------------- -------------
          Gross revenue . . . . . $     69,048  $     44,193  $    113,241 
                                  ============= ============= ============= 
          Operating income (loss) $     (8,298) $        492  $     (7,806)
          Interest income . . . .          569         -               569 
          Interest expense  . . .        2,322         1,354         3,676 
          Minority interest . . .        -               138           138 
          Loss before income tax  ------------- ------------- -------------
           benefit  . . . . . .   $    (10,051) $       (724) $    (10,775)
                                  ============= ============= ============= 
          Identifiable assets . . $     47,073  $     46,010  $     93,083 
                                  ============= ============= ============= 
          Depreciation and                      
           amortization   . . . . $      2,039  $      3,611  $      5,650 
                                  ============= ============= ============= 
          Capital Expenditures  . $      4,429  $      2,539  $      6,968 
                                  ============= ============= ============= <PAGE>





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

               None.
                                       PART III
          Item 10.  Directors and Executive Officers of the Registrant

               The directors and  executive officers of the  Company are as
          follows:

                        Name               Age           Position         
          -------------------------------- ---  --------------------------
          Francis M. Williams . . . . . .   55  President, Chief Executive
          Norman S. Dominiak  . . . . . .   52  Officer, and Director
          Joseph M. Williams  . . . . . .   40  Vice President
          Michael Gold  . . . . . . . . .   48  Secretary and Treasurer
          George Chandler . . . . . . . .   67  Director
                                                Director

               All  directors of  the Company  hold  office until  the next
          annual meeting of stockholders and the election and qualification
          of their successors. Officers of the Company are elected annually
          by the Board  of Directors and hold  office at the  discretion of
          the Board of Directors.

               Francis M. Williams has  been President and Chairman  of the
          Board  of the  Company since  its inception.  For more  than five
          years prior  to November 1988,  Mr. Williams was the  Chairman of
          the Board  and Chief Executive  Officer of Kimmins Corp.  and its
          predecessors and sole owner of  K Management Corp. From June 1981
          until January  1988, Mr.  Williams was also  the President  and a
          Director  of  College  Venture  Equity Corp.,  a  small  business
          investment company. Mr. Williams has  also been a Director of the
          National Association  of Demolition  Contractors and a  member of
          the  Executive Committee  of  the Tampa  Bay International  Trade
          Council.

               Norman  S.  Dominiak has  been  the  Vice President  of  the
          Company since March 1995, and has been employed by the Company as
          its  Chief Financial  Officer  since January  1994. Mr.  Dominiak
          served as  Controller of ThermoCor Kimmins, Inc., a subsidiary of
          the Company, from October 1991 until January 1994. From  May 1988
          until  September  1991,  Mr.   Dominiak  served  as  Senior  Vice
          President   of  Creative   Edge,   a  company   engaged  in   the
          manufacturing  and  distribution  of  educational  products. From
          October 1982 until April 1988, Mr. Dominiak served as Senior Vice
          President  of  Cecos  Environmental  Services,  Inc.,  a  company
          engaged in treatment,  transportation, and disposal  of hazardous
          waste. From 1965 until 1982, Mr. Dominiak was employed in various
          financial capacities for the Carborundum Company.

               Joseph  M. Williams has been the  Secretary and Treasurer of
          the Company since October 1988. Since November 1991, Mr. Williams<PAGE>





          has served as  President and  has been a  Director of  Cumberland
          Technologies,   Inc.,  a   holding  company   whose  wholly-owned
          subsidiaries  provide  reinsurance  and  specialty  sureties  and
          performance and payment bonds. Since June  1986, Mr. Williams has
          served as President and Vice President and has been a Director of
          Cumberland  Real  Estate  Holdings, Inc.,  the  corporate general
          partner   of   Sunshadow  Apartments,   Ltd.   ("Sunshadow")  and
          Summerbreeze Apartments, Ltd. ("Summerbreeze"), both of which are
          limited   partnerships.  In   June   1992,  both   Sunshadow  and
          Summerbreeze filed  voluntary petitions  under Chapter 11  of the
          United  States  bankruptcy  law,  and  each  entity  submitted  a
          prepackaged plan  of reorganization. In June  1993, Sunshadow and
          Summerbreeze entered into a settlement and note renewal agreement
          and  the  bankruptcy  filings  were  voluntarily  dismissed.  Mr.
          Williams has been employed by the Company and its subsidiaries in
          various  capacities  since January  1984.  From  January 1982  to
          December 1983, he was the managing partner of Williams and Grana,
          a  firm  engaged  in  public  accounting.  From January  1978  to
          December  1981,  Mr.  Williams  was  employed  as  a  senior  tax
          accountant  with Price Waterhouse & Co. Joseph M. Williams is the
          nephew of Francis M. Williams.

               Michael  Gold  has been  a  Director  of  the Company  since
          November  1987. For more  than the past five  years, Mr. Gold has
          been a  partner in the Niagara  Falls, New York law  firm of Gold
          and Gold.

               George Chandler  has been  a Director  of the  Company since
          January  1990.  Since  November 1989,  Mr.  Chandler  has been  a
          business consultant. Mr. Chandler was Chairman of the  Board from
          July 1986  to November  1989, and President  and Chief  Executive
          Officer from October 1985 to November 1989 of Aqua-Chem,  Inc., a
          manufacturer of packaged  boilers and water  treatment equipment.
          From May 1983 to October 1985, he was President,  Chief Executive
          Officer and a  Director of American  Ship Building Co.,  which is
          engaged  in  the construction,  conversion  and  repair of  cargo
          vessels. Mr. Chandler is also a Director of The Allen Group Inc.,
          and DeVlieg Bullard, Inc.
               Set  forth  below  is  information  regarding   certain  key
          employees of the Company:

               Ira  D. Cohen,  50,  has been  President  of TransCor  Waste
          Services, Inc., since July 1, 1996.  Mr. Cohen is responsible for
          the operations,  safety, profitability,  and compliance  with all
          federal,  state and  local  regulations for  the Company s  solid
          waste facilities.   From 1992 to  June 1996, Mr. Cohen  served as
          President for John  Sexton Contractors Company.   Mr. Cohen  also
          served as  Chief Operating  Officer for Land  Reclamation Company
          from 1989 to  1992.  From 1986  to 1989, Mr. Cohen served  as the
          Regional Landfill Manager and  Director of Landfill Operations of
          Chambers Development Company, Inc.<PAGE>





               Michael D. O'Brien, 46, has been employed by TransCor  Waste
          Services,  Inc. (including  its  predecessor) as  Vice  President
          since October 1992. From  June 1987 to October 1992,  Mr. O'Brien
          served as Vice President  of Kimmins Industrial Service  Corp., a
          subsidiary  of  the Company.  From July  1983  to June  1987, Mr.
          O'Brien  served   as  Vice  President  of   Jordan  Foster  Scrap
          Corporation  in  Buffalo, New  York,  a  company specializing  in
          demolition and preparation of scrap  for sale. From November 1972
          to July 1983, Mr.  O'Brien was employed by a  national demolition
          contractor.

               John  V.  Simon  Jr., 41,  has  been  President and  General
          Manager of Kimmins Contracting Corp., responsible for supervising
          utility  construction,  since May  1981,  and  served  as a  Vice
          President  of  the Company  from  1981 until  October  1988. From
          January  1978 to  May 1981,  Mr. Simon  owned Simon  Construction
          Company,  a company that  performed site  work and  utilities and
          demolition projects.

               Section  16(a)  Beneficial Ownership  Reporting  Compliance.
          Pursuant to Section 16(a) of the Securities Exchange Act  of 1934
          and the rules issued thereunder, the Company s executive officers
          and directors and any persons holding more than 10 percent of the
          Company s common stock  are required to file  with the Securities
          and Exchange Commission and the  New York Stock Exchange  reports
          of their initial ownership of the Company s common stock  and any
          changes in ownership  of such common  stock.  Specific  due dates
          have been established, and the Company is required to disclose in
          its Annual Report on Form 10-K and Proxy Statement any failure to
          file such reports  by these  dates.  Copies  of such reports  are
          required to  be furnished to  the Company.   Based solely  on its
          review of the copies of such reports furnished to the Company, or
          written  representations  that  no  reports  were  required,  the
          Company believes that, during 1996, all of its executive officers
          (including the Named Executive  Officers), directors and  persons
          owning more than 10 percent of its common stock complied with the
          Section 16(a) requirements.<PAGE>





          Item 11.  Executive Compensation

               Summary Compensation  Table.  The following  table  provides
          certain  summary  information  concerning  compensation  paid  or
          acrued by the Company and its subsidiaries to the Chief Executive
          Officer and all other executive officers  whose salary  and bonus 
          exceeded $100,000   for  the  year  ended  December 31, 1996 (the
          "Named Executives"):

   <TABLE>                                SUMMARY COMPENSATION TABLE
   <CAPTION>
                                                            Long-Term Compensation                 
                                                       -------------------------------
                                Annual Compensation            Awards          Payouts  
                            -------------------------- ---------------------- --------
                                                Other              Securities               All
                                                Annual  Restricted Underlying              Other
                                               Compen-    Stock     Options/     LTIP     Compen-
         Name and             Salary    Bonus   sation   Award(s)     SARs      Payout    sation
    Principal Position Year    ($)       ($)     ($)       ($)        (#)        (s)        ($)    
   ------------------- ---- --------  -------- ------- ----------  ---------- --------  ----------
   <S>                 <C>  <C>       <C>      <C>     <C>         <C>        <C>       <C>    <C>
   Francis M. Williams 1996  $318,482    $0       $0        $0         0          $0     $995  (*)
     Chairman of the   1995  $271,137    $0       $0        $0         0          $0     $989  (*)
     Board, President  1994  $171,139    $0       $0        $0         0          $0     $977  (*)
     and Chief
     Executive Officer
                                                                                        
   John V. Simon, Jr.  1996  $95,000   $25,000    $0        $0         0          $0    $1,655 (*)
     President of      1995  $95,000   $81,489    $0        $0         0          $0    $1,647 (*)
     Kimmins           1994  $95,000   $15,759    $0        $0         0          $0    $1,635 (*)
     Contracting Corp.

   (*)  Represents the  Company's contribution to  the employee's  account of  the Company's  401(k)
        Plan and  premiums paid by  the Company for  term life insurance  and long-term  disability.
        These  plans, subject  to  the  terms and  conditions of  each  plan, are  available to  all
        employees.
   </TABLE>

               Stock Option/SAR Grants  in the Last Fiscal Year.   No stock
          options  or stock appreciation  rights were granted  to the Named
          Executives during the year ended December 31, 1996.

               Aggregated  Option/SAR  Exercises  in Last  Fiscal  Year and
          Fiscal   Year-  End  Option/SAR   Values.  The   following  table
          summarizes the  net value realized on the  exercise of options in
          1996  and the  value of  outstanding options  as of  December 31,
          1996, for the Named Executives.<PAGE>





     <TABLE>
                          AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
                                 AND FISCAL YEAR-END OPTION/SAR VALUES

      <CAPTION>                                                   Number of
                                                                  Securites         Value of
                                                                  Underlying      Unexercised
                                                                 Unexercised      In-the-Money
                                  Shares                       Options/SARs at  Options/SARs at
                                 Acquired          Value         Year-End (#)   Year-End ($)(1)
                                on Exercise       Realized       Exercisable/     Exercisable/
               Name                 (#)             ($)         Unexercisable    Unexercisable 
       --------------------- ---------------  ---------------  ---------------  ---------------
       <S>                   <C>              <C>              <C>              <C>
       John V. Simon, Jr.            0               $0          13,533/8,134       $135/$0

       (1) Value is calculated using the Company's closing stock price on December 31, 1996, of
           $3.375 per share less the exercise price for such shares.
       </TABLE>
            No stock options or stock  appreciate rights were exercised by
     Francis  M. Williams  during the year ended December 31, 1996, and Mr.
     Williams  does  not  have  any  outstanding  stock options or SARs at
     December 31, 1996.
     <TABLE>
                                    TEN-YEAR OPTION/SAR REPRICINGS
      <CAPTION>                                                                      Length of
                                      Number of      Market                           Original
                                      Securities      Price      Exercise           Option Term
                                     Underlining   of Stock at   Price at            Remaining
                                     Options/SARs    Time of     Time of      New    at Date of
                                     Repriced or  Repricing or Repricing or Exercise Repricing
                                       Amended      Amendment   Amendment    Price       or
               Name           Date       (#)           ($)         ($)        ($)    Amendment  
      --------------------  -------- ------------ ------------ ------------ -------------------
      <S>                   <C>      <C>          <C>          <C>          <C>     <C>
      Norman S. Dominiak    10/30/94        3,333     $4.50       $6.39      $4.50    4 years
      Vice President                          833     $4.50       $7.14      $4.50    4 years
      Joseph M. Williams    10/30/94       10,333     $4.50       $6.75      $4.50    4 years
      Secretary/Treasurer

      Michael D. O Brien    10/30/94       15,976     $4.50       $6.75      $4.50    4 years
      Vice President of
      TransCor

      John V. Simon, Jr.    10/30/94       12,833     $4.50       $6.75      $4.50    4 years
      President of Kimmins                  2,500     $4.50       $6.00      $4.50    4 years
      Contracting Corp.
      </TABLE>                                                                  


               Compensation Committee Interlocks and Insider Participation.
          During the year ended December 31, 1996, Francis M. Williams, the
          Company's  President and Chairman of the  Board of Directors, has
          served as President  and Chairman  of the Board  of Directors  of
          TransCor.<PAGE>





               Compensation of  Directors. During  the year  ended December
          31, 1996, the Company paid non-officer Directors an annual fee of
          $5,000  and  $1,000 per  board  meeting  attended. Directors  are
          reimbursed for all  out-of-pocket expenses incurred  in attending
          Board of Directors and committee meetings.

          Stock Option and Other Plans 

          1987 Stock Option Plan
               The  Company  adopted  a  stock  option  plan  (the  "Plan")
          pursuant  to which 288,400 shares of common stock were originally
          reserved  for  issuance  to  persons  upon  exercise  of  options
          designated as  "incentive stock  options," within the  meaning of
          Section  422A of the Internal Revenue  code of 1986 (the "Code"),
          and non-qualified stock  options. The purpose of  the Plan is  to
          attract,  retain,  and  motivate  officers  and  other  full-time
          employees of the Company,  and certain other persons instrumental
          to  the success of the Company, and  to provide them with a means
          to acquire  a proprietary interest  in the  Company. The Plan  is
          administered  by a committee  consisting of three  members of the
          Board  of Directors.  The exercise  price of  an  incentive stock
          option  granted  under the  Plan may  not be  less than  the fair
          market  value of  the  common stock  at  the time  the option  is
          granted  (110 percent  of fair  market  value in  the case  of an
          incentive stock option granted to an employee owning more than 10
          percent  of the voting stock of  the Company). The exercise price
          of a non-qualified stock option granted under the Plan may be any
          amount determined by the Board of Directors but not less than the
          par value of the common  stock on the date of the  grant. Options
          granted under the Plan must, in general, expire no later than ten
          years from  the date of  the grant (five  years from the  date of
          grant in  the case  of an  incentive stock  option granted  to an
          employee owning more than  10 percent of the voting stock  of the
          Company). All  options granted to date provide that the grantees'
          rights vest over  five years from the date  of grant. At December
          31, 1996, Joseph  M. Williams held 13,333 options to purchase the
          Company's stock  at between $3.33  and $4.50  per share of  which
          9,200 shares  are  exercisable. At  December  31, 1996,  John  V.
          Simon,  Jr., held 21,667 options  to purchase the Company's stock
          at between $3.33 and $4.50 per share, of which 13,533  shares are
          exercisable.

          Savings and Profit-Sharing Plan

               The Company  offers a  savings and profit-sharing  plan (the
          "401(k) Plan"), which  qualifies under Sections 401(a) and (k) of
          the Code.  Employees of  the Company  and certain  affiliates who
          have been employed for a specified period of time are eligible to
          participate  in the  401(k) Plan. All  contributions made  by the
          employees vest  immediately. Amounts  contributed by  the Company
          vest 20 percent after three years of service and 20 percent  each
          year thereafter.<PAGE>





          Profit and Equity Participation Plan

               The  Company's  Profit  and Equity  Participation  Plan (the
          "Profit Participation Plan"), a defined contribution plan, covers
          employees of  the Company  and certain affiliates  who have  been
          employed for  a specified  period of  time. Contributions to  the
          Profit Participation Plan are made at the discretion of the Board
          of Directors. Employees' rights  in the Profit Participation Plan
          vest 20 percent after three years of service and 20 percent  each
          year thereafter.  The Profit  Participation Plan was  merged into
          The Kimmins Environmental Service Corp. Employee  Stock Ownership
          Plan Trust ("ESOP") on January 1, 1989. 

          Employee Stock Ownership Plan
               Effective January  1, 1989, the Company formed  the ESOP for
          the benefit of  the employees of the Company and its subsidiaries
          to purchase  shares of the  Company's common  stock from time  to
          time  on the open market or  in negotiated transactions at prices
          deemed  to   be  attractive   and,  simultaneously,   the  Profit
          Participation Plan was merged into the ESOP. Contributions to the
          ESOP are  made at the discretion  of the Board of  Directors and,
          for the year  ended December 31, 1989, was $200,000. During 1989,
          the  ESOP  acquired from  the  Company's  President approximately
          772,000  shares of  common  stock at  a cost  of  $5,100,000. The
          shares  were  acquired  in exchange  for  a note  payable  to the
          President.  Simultaneously  with  such  purchase,  the  President
          purchased   certain  receivables   and   interests   in   certain
          investments from the Company for a purchase price  of $5,100,000,
          which was  paid by  the  assignment to  the Company  of the  note
          received  from the ESOP. The note  was funded, during March 1990,
          through a  long-term bank  financing agreement guaranteed  by the
          Company.  Expenses   with  respect   to  the  ESOP   include  the
          recognition of interest  expense relating to the ESOP debt and to
          earned  compensation.  For  the  year ended  December  31,  1996,
          interest expense  and compensation  expense relating to  the ESOP
          were  $186,000 and  $480,000,  respectively. As  of December  31,
          1996, the unpaid ESOP  debt is also reflected  as a reduction  in
          stockholders' equity.<PAGE>





          Item 12.  Security  Ownership  of Certain  Beneficial  Owners and
                    Management

          The following table sets forth the number of shares  of the Company's
     common stock beneficially owned as  of April 1, 1997, by (i) persons known
     by  the Company  to own more  than 5  percent of the Company's outstanding
     common stock, (ii) by each Named Executive and director  of  the  Company,
     and (iii) all Named Executives and directors of the Company as a group:
<TABLE>
<CAPTION>
         Name and Address of                                                Percent    Total
          Beneficial Owner                                                    of       Voting
                 (1)               Title of Class       Number of Shares     Class     Power   
       ----------------------  --------------------   -------------------  -------   ----------
       <S>                     <C>                    <C>          <C>     <C>       <C>
       Francis M. Williams     Common Stock             1,857,065    (2)     41.8%        61.6%
                               Class B Common Stock     2,291,569           100.0%
                                                                                   
       Joseph M. Williams      Common Stock               362,775    (3)       8.2%        5.4%
                                                                                   
       John V. Simon, Jr.      Common Stock                20,759    (4)        *           *  
                                                                                   
       Michael Gold            Common Stock                14,923    (5)        *           *  
                                                                                   
       George Chandler         Common Stock                 7,914    (6)        *           *  
                                                                                   
       All directors and       Common Stock             2,263,436  (2)(3)     50.9%
       and executive officers                                      (5)(7)  
       as a group                                                                         67.3%
       (five persons)          Class B Common Stock     2,291,569            100.0%
       </TABLE>

          (1)  The addresses of  all officers and directors of  the Company
               above  are in  care of  the Company  at 1501  Second Avenue,
               East, Tampa, Florida 33605.

          (2)  Includes 1,479,136  shares owned directly by  Mr. Francis M.
               Williams; 133,333 shares  owned by Summerbreeze  and 121,750
               shares owned by Sunshadow, both of which Mr. Williams is the
               sole shareholder  of the  corporate general partner  and the
               sole  limited partner (see  Item 13,  "Certain Relationships
               and  Related  Transactions");  48,908 shares  owned  by  Mr.
               Williams'  wife;  30,493  shares  held by  Mr.  Williams  as
               Trustee for his wife and children; 37,913 shares held by Mr.
               Williams as Custodian  under the New  York Uniform Gifts  to
               Minors  Act  for  his children;  4,464  shares  held  by the
               Company's 401(k)  and ESOP  Plans of  which Mr.  Williams is
               fully  vested;  and  1,067  shares held  by  Kimmins  Realty
               Investment,  Inc.,  which  is   owned  100  percent  by  Mr.
               Williams.<PAGE>





          (3)  Includes  10,000 shares  owned  by Mr.  Joseph M.  Williams;
               9,200 shares issuable upon exercise of currently exercisable
               stock options; 2,355 shares held by the Company's 401(k) and
               ESOP  Plans  of  which Mr.  Williams  is  fully vested;  and
               341,220 shares held by the Company's 401(k) Plan and ESOP of
               which Mr.  Williams  is a  trustee  with shared  voting  and
               investment power.

          (4)  Includes  1,500 shares  owned  by Mr.  Simon; 13,533  shares
               issuable  upon  exercise   of  currently  exercisable  stock
               options; and 5,726  shares held by the  Company s 401(k) and
               ESOP plans of which Mr. Simon is fully vested.

          (5)  Includes  1,150  shares  owned  by Mr.  Gold;  5,775  shares
               currently owned  by Mr. Gold's wife; 2,898  held by Mr. Gold
               as trustee for Mr. Gold's  minor children; and 5,100  shares
               issuable   upon  exercise  of  currently  exercisable  stock
               options.
          (6)  Includes  3,114  shares owned  by  Mr.  Chandler; and  4,800
               shares issuable upon exercise of currently exercisable stock
               options. 

          (7)  Includes 19,100  shares issuable upon exercise  of currently
               exercisable  stock   options;  6,250  shares   held  by  the
               Company's 401(k) and ESOP Plans of which certain officers of
               the Company are fully vested; and 341,471 shares held by the
               Company's 401(k)  and ESOP Plans  of which the  Secretary of
               the Company is a trustee.

             * Less than one percent.

          Item 13.  Certain Relationships and Related Transactions

               During 1994, 1995  and 1996, the Company paid  landfill fees
          of approximately $28,000, $88,000, and $139,000, respectively, to
          a  company that is owned primarily by  the brother of Mr. Francis
          M. Williams. The amount paid  approximated fair market rates  for
          the type of services involved.

                The Company has  a note receivable in an original amount of
          $3,638,696  from  Sunshadow  Apartments, Ltd.,  and  Summerbreeze
          Apartments,  Ltd., two  Florida real estate  limited partnerships
          (collectively,  the  "Apartments"),  of  which   Mr.  Francis  M.
          Williams is the sole shareholder of the corporate general partner
          and  the sole  limited  partner. The  note receivable  originally
          accrued interest at prime plus 1.375 percent, increasing to prime
          plus  2 percent  on  July 1,  1995, with  principal  and interest
          payable in monthly installments through December 31, 1998, and is
          guaranteed  by  Mr. Williams.  The  Company did  not  receive any
          interest or principal payments during 1996 relating to  this note
          receivable,   and   management   of   the   Company  discontinued
          recognition of interest income  of approximately $551,000 for the<PAGE>





          year.  Amounts  due from the Apartments at  December 31, 1995 and
          1996, are approximately $3,851,000.

               At December  31, 1995 and  1996, $5,301,000 of  the combined
          accounts receivable - affiliates  and note receivable - affiliate
          balances  are  due from  corporate  affiliates  of the  Company's
          President. The affiliated receivables relate to contract services
          performed and are guaranteed by Mr. Williams.

               On November  5, 1996, the Company  received 1,723,290 shares
          of  Cumberland common  stock in exchange  for the  term note from
          affiliate.   The Cumberland common stock had  a fair market value
          of $3.00  per share on the  date of the exchange,  based upon the
          quoted market price.  This investment is accounted for  under the
          equity   method,  and  the   Company s  interest   in  Cumberland
          represents  an ownership share  of approximately 30  percent.  At
          December 31,  1996, the  market  value of  the Cumberland  common
          stock held by the Company was approximately $5,170,000.<PAGE>





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

          (a)  List of documents filed as part of this Report

             1. Financial Statements
               -  Report of Independent Certified Public Accountants
               -  Consolidated balance sheets at December 31, 1995 and 1996
               -  Consolidated statements of operations for each
                   of the three years in the period ended December 31, 1996
               -  Consolidated statements of stockholders' equity for each
                   of the three years in the period ended December 31, 1996
               -  Consolidated statements of cash flows for each 
                   of the three years in the period ended December 31, 1996
               -  Notes to consolidated financial statements

             2. Financial Statement Schedule

               Schedule                                              Page  
                Number                                               Number
               --------                                              ------

               II  - Valuation and Qualifying Accounts  . . . . . .  S-1   

               All  other   Schedules  are   omitted  since  the   required
          information  is  not  present  or   is  not  present  in  amounts
          sufficient to require submission of the Schedules, or because the
          information required is included  in the financial statements and
          notes thereto.

             3.   The  following documents  are filed  as exhibits  to  this
          Annual Report on Form 10-K:

               3 (a)    --  Restated Certificate of Incorporation 
                             of Registrant, as amended.
               3 (b) *  --  By-laws of Registrant
               10.1 **  --  Stock Option Plan
               21       --  Subsidiaries of the Registrant
               23       --  Consent of Ernst & Young LLP
               27       --  Financial Data Schedule (for SEC use only)
          -----------------------------------

           *  Previously filed on  March 17, 1987, as  part of Registrant's
              Registration Statement  on Form  S-1, File No.  33-12677, and
              incorporated herein by reference thereto.

           **  Previously filed on June 29,  1989, as part of  Registrant's
               Form  S-8, File  No.  33-29612, and  incorporated herein  by
               reference thereto.

          (b)  Reports on Form 8-K.

             None<PAGE>





                                      SIGNATURES


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


          Date:  April 15, 1997    By:  /s/ Francis M. Williams
                                        ----------------------------------
                                        Francis M. Williams
                                        President


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

          Date:  April 15, 1997         /s/ Francis M. Williams
                                        ----------------------------------
                                        Francis M. Williams
                                        President and Director
                                        (Chief Executive Officer)


          Date:  April 15, 1997         /s/ Jospeh M. Williams
                                        ----------------------------------
                                        Joseph M. Williams
                                        Secretary/Treasurer


          Date:  April 15, 1997         /s/ Norman S. Dominiak
                                        ----------------------------------
                                        Norman S. Dominiak
                                        Vice President and
                                        Chief Financial Officer
                                        (Principal Accounting and 
                                        Financial Officer)


          Date:  April 15, 1997         /s/ Michael Gold
                                        ----------------------------------
                                        Michael Gold, Director




          Date:  April 15, 1997         /s/ George A. Chandler
                                        ----------------------------------
                                        George A. Chandler, Director<PAGE>





                                                                 EXHIBIT 21

                            SUBSIDIARIES OF THE REGISTRANT



                                                     State or Providence
                                                      of Incorporation
                           Company                     or Organization
            --------------------------------------  ---------------------

            Kimmins Contracting Corp. . . . . . .   Florida
            Kimmins Ltd.  . . . . . . . . . . . .   Ontario, Canada

            Kimmins Industrial Service Corp.  . .   Delaware

            Kimmins Abatement Corp. . . . . . . .   Delaware

            ThermoCor Kimmins, Inc. . . . . . . .   Florida             
             (f/k/a Kimmins Thermal Corp.)

            TransCor Waste Services, Inc. . . . .   Florida

            Kimmins Recycling Corp. . . . . . . .   Florida

            Kimmins Incorporated  . . . . . . . .   Texas
            Kimmins International . . . . . . . .   Florida

            Fourth Avenue Holdings, Inc.  . . . .   Florida

            40th Street, Inc. . . . . . . . . . .   Florida

            Lantana Eighth Avenue Corp. . . . . .   Florida
            Factory Street Corporation  . . . . .   Tennessee<PAGE>





                                                                 EXHIBIT 23







                 CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS


               We  consent  to  the   incorporation  by  reference  in  the
          Registration Statement (Form S-8  No. 33-29612) pertaining to the
          1987  Stock Option  Plan  of  Kimmins Corp.  and  in the  related
          Prospectus, of our  report dated April 14, 1997,  with respect to
          the consolidated  financial  statements and  schedule of  Kimmins
          Corp.  included in  the Annual  Report (Form  10-K) for  the year
          ended December 31, 1996.








                                                      /s/ Ernst & Young LLP




          Tampa, Florida
          April 18, 1997<PAGE>





     <TABLE>
                                    KIMMINS CORP.

                   Schedule II - Valuation and Qualifying Accounts
                           Allowance for Doubtful Accounts

     <caption)

                                                      
                                  Balance   Additions   Deductions
                                    at     Charged to      from      Balance at
                                 Beginning  Costs and   Allowances     End of
             Description         of Period  Expenses        (a)        Period   
     -------------------------  ---------  ---------- -------------  ----------
     <S>                        <C>        <C>        <C>            <C>
     Year ended                                              
      December 31, 1994  . . .   $438,016   $495,375    $(270,394)    $662,997

     Year ended                                              
      December 31, 1995  . . .   $662,997   $404,455    $(670,241)    $397,211 

     Year ended                                              
      December 31, 1996  . . .   $397,211   $430,381    $(210,884)    $616,708
     </TABLE>




     (a)  Balance represents the write-off of uncollectible accounts.





















                                         S-1<PAGE>