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RESULTS OF OPERATIONS

     Zapata reported net income of $2.4 million for the second quarter of fiscal
1995 as compared to net income of $2.3 million for the same period in fiscal
1994. The fiscal 1995 second quarter results included a $4.8 million pretax gain
from the sale of 673,077 shares of Tidewater common stock, while the
corresponding fiscal 1994 period results included a $3.6 million pretax gain
from the sale of 375,175 shares of Tidewater stock. The fiscal 1994 second
quarter net income also included $918,000 from the Company's discontinued marine
protein operations.

     The Company's operating loss of $396,000 for the second quarter of fiscal
1995 compared favorably to the operating loss of $775,000 for the corresponding
fiscal 1994 period. The improvement was primarily attributable to reduced
general and administrative expenses associated with the Company's corporate
headquarters and improved results from the Company's natural gas gathering,
processing and marketing operations. These improvements were partially offset by
the effects of significantly lower natural gas prices that negatively impacted
the operating results of the Company's natural gas compression and domestic oil
and gas divisions. Revenues for the second quarter of fiscal 1995 totalled $38.1
million as compared to $53.3 million for the second quarter of fiscal 1994.

     For the first six months of fiscal 1995, Zapata's net income of $2.8
million was significantly lower than the $19.6 million for the corresponding
1994 period as a result of pretax gains totalling $37.5 million realized from
the sales of Tidewater common stock in 1994. Revenues of $84.1 million and
operating income of $934,000 for the 1995 period compared to the 1994-period
revenues of $112.8 million and operating loss of $437,000.
 
NATURAL GAS COMPRESSION - In November 1993, Zapata purchased Energy Industries,
Inc. ("Energy Industries"), a participant in all segments of the natural gas
compression industry. During the second quarter of fiscal 1995, Energy
Industries acquired 59 additional compressor units in two separate transactions
for $3.4 million.  Energy Industries operates one of the ten largest rental
fleets of natural gas compressor packages in the United States.  Its compressor
fleet is located in Texas, Louisiana, Arkansas, Oklahoma and New Mexico, as well
as offshore in the Gulf of Mexico.

     Energy Industries primarily supplies natural gas compressor packages in
natural gas production and processing applications.  In natural gas production
applications, natural gas compression is used to increase the flow rate of gas
wells with low reservoir pressures.  In natural gas processing applications,
natural gas compression is used in the process of separating the various
hydrocarbon components of the wellhead natural gas stream.  In interstate
natural gas pipeline applications, natural gas compression is used to increase
the pressure of natural gas from reservoir levels to interstate pipeline
standards.  Energy Industries maintains an inventory of compressor and engine
components to support the fabrication, service and repair of natural gas
compressor packages.

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