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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

(x) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (D) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED MAY 31, 1994
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934

COMMISSION FILE NUMBER 1-9944

CHAPARRAL STEEL COMPANY
(Exact name of registrant as specified in its charter)

DELAWARE 75-1424624
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

300 WARD ROAD, MIDLOTHIAN, TEXAS 76065
(Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code: A/C 214 775-8241
Securities registered pursuant to Section 12(b) of the Act:

NAME OF EACH EXCHANGE ON
TITLE OF EACH CLASS WHICH REGISTERED
------------------- ----------------

COMMON STOCK, PAR VALUE $.10 NEW YORK STOCK EXCHANGE

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

NONE

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

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

Aggregate market value of the voting stock (which consists solely of
shares of Common Stock) held by non-affiliates of the registrant as of August
5, 1994, computed by reference to the closing sale price of the registrant's
Common Stock on the New York Stock Exchange on such date: $53,249,063.

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

COMMON STOCK - $.10 PAR VALUE
29,679,900 SHARES AS OF AUGUST 5, 1994

DOCUMENTS INCORPORATED BY REFERENCE

PORTIONS OF THE REGISTRANT'S ANNUAL REPORT TO STOCKHOLDERS FOR THE YEAR
ENDED MAY 31, 1994 INCLUDED AS EXHIBIT 13 TO THIS ANNUAL REPORT ARE
INCORPORATED BY REFERENCE INTO PART II.

PORTIONS OF THE REGISTRANT'S DEFINITIVE PROXY STATEMENT FOR THE ANNUAL
MEETING OF STOCKHOLDERS TO BE HELD OCTOBER 19, 1994 (S.E.C. FILE NUMBER:
1.001-09944), ARE INCORPORATED BY REFERENCE INTO PART III.

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TABLE OF CONTENTS

PAGE

PART I

Item 1. Business............................................ 1

Item 2. Properties.......................................... 5

Item 3. Legal Proceedings................................... 5

Item 4. Submission of Matters to a Vote of
Security Holders............................... 5

PART II

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

Item 6. Selected Financial Data.............................. 5

Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations............. 6

Item 8. Financial Statements and Supplementary Data.......... 6

Item 9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure.............. 6

PART III

Item 10. Directors and Executive Officers of the Registrant..... 7

Item 11. Executive Compensation................................. 9

Item 12. Security Ownership of Certain Beneficial Owners
and Management.................................... 9

Item 13. Certain Relationships and Related Transactions......... 9

PART IV

Item 14. Exhibits, Financial Statement Schedules and
Reports on Form 8-K................................ 10

PART I

ITEM 1. BUSINESS

(a) General development of business

Chaparral Steel Company (the "Company") was organized as a Delaware
corporation in July 1973 by Texas Industries, Inc. ("TXI") and Co-Steel
Inc.("Co-Steel"), a Canadian corporation, which owns steel mills in New Jersey,
Canada and the United Kingdom. TXI is a New York Stock Exchange listed company
which produces cement and concrete. At the time of the Company's organization,
TXI and Co-Steel each owned a 50% interest in the Company. TXI owned 100% of
the Company from November 1985 when it acquired the remaining 50% of the
outstanding securities of the Company from Co-Steel, until July 1988 when
approximately 19.8% of the outstanding securities were sold in an initial
public offering of common stock by the Company. The consolidated financial
statements include the operations of Chaparral Steel Company, America Steel
Transport and Chaparral's inactive wholly-owned subsidiaries.

(b) Financial information about industry segments

The Company operates in the steel industry only; therefore, no industry
segment information is presented.

The Company's original steel mill facility was completed in 1975 and
consisted of an electric arc furnace and a rolling mill, which produced rebar
used in concrete construction, and small size angles, channels, rounds and
flats. The mill achieved a production rate of approximately 500,000 tons per
year, which was substantially above its original design capacity.

In 1982, a major expansion of the steel mill, at a cost of
approximately $180 million, added an additional electric arc furnace and
rolling mill to produce medium-sized structural products. The expansion enabled
the Company to produce beams up to 8" wide. Additional modifications to the
medium section mill now enable the Company to produce beams up to 14" wide, in
addition to large channels and angles.

During fiscal 1992, commissioning was completed on a large beam mill
which has expanded the existing product range up to include 24" wide flange
beams. The expansion was financed with long-term senior unsecured notes of $80
million.

PRODUCTS

The Company's products are sold generally to steel service centers and
steel fabricators for use in the construction industry, as well as to cold
finishers, forgers and original equipment manufacturers for use in the
railroad, defense, automotive, mobile home and energy industries.

The Company designed its bar and structural mills to efficiently
produce bar mill products (31% of 1994 sales on a tonnage basis), structural
mill products (52% of 1994 sales on a tonnage basis) and large beam mill
products (17% of 1994 sales on a tonnage basis). The bar and structural mills
can be modified, without substantial cost or delay, to change current product
mix in order to comply with customer needs or changes in market conditions.

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4

After inspection, bundling and strapping, finished products are
delivered by common carrier, customer-owned truck, rail or barge. The Company
maintains an inventory of finished products based on anticipated short-term
usage to provide prompt shipments to customers when possible.

The following is a general description of the Company's products:

REINFORCING BAR

The Company produces all commercial sizes of rebar from 3/8" diameter
to 1-3/8" diameter for use in construction applications ranging from highway
and public works projects to residential and high-rise construction.

MERCHANT QUALITY ROUNDS

Merchant quality rounds are cylindrical steel bars used in
construction and fabrication operations. Common uses include roof joists,
anchor bolts and truss supports.

SPECIAL BAR QUALITY ROUNDS

Special Bar Quality ("SBQ") rounds are produced in a large variety of
carbon and alloy grades primarily for use in the forging, machining and cold
drawing industries for production of automotive gears and hand tools. SBQ
rounds are also used as sucker rod material in the oil industry.

BEAMS

Beams are used for building construction and the non-building
fabrication industries. Sales of beams currently constitute approximately 64%
of the Company's sales on a tonnage basis. Beams produced by the Company's
medium section mill include wide-flange beams (ranging in size from 4" x 4" to
14" x 6-3/4"), certain sizes of standard "I" beams and Bantam(TM) beams. Those
beams are used in low-rise construction (up to five stories) and in various
fabrication operations for industrial machinery and mobile home frames. The
large beam mill has enabled the Company to produce wide-flange beams from 8" to
24" in diameter that are used in multi-story buildings, short-span bridges and
other heavy industrial applications.

STRUCTURAL MERCHANT SHAPES AND OTHER PRODUCTS

These products consist of structural channels, flat bars and squares
used in the equipment manufacturing and construction industries, particularly
in low-rise structures.

The Company's products are predominately marketed in North America
exclusively by Company salespersons. Approximately 47% of the Company's
products are sold in Texas, Oklahoma, Louisiana and Arkansas. Other regional
sales of the Company's products are approximately 17% in the midwest United
States and approximately 11% in the southeastern United States. Rebar, merchant
shapes and other products are sold principally to customers located in the
southwestern United States. The Free Trade Agreements between the United
States, Canada and Mexico may continue to favorably affect the Company's
position as a supplier of certain steel products in the Canadian and Mexican
markets. Export sales accounted for 7% of 1994 shipments.

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5

EXPANDING CAPACITY

Historically, the Company's philosophy was to operate its mill at full
production capacity. Recently, the Company refocused on serving customer
requirements and specific markets while striving to achieve the lowest possible
unit cost of production. The Company's strategy is to continually increase its
melting capacity through productivity improvements, the utilization of new
technology and capital expenditures. Continuing increases in melting capacity
have dictated further capital spending for increases in rolling capacity to
allow maximum use of the Company's facilities to take advantage of marketplace
opportunities.

RAW MATERIALS AND ENERGY

The Company's primary raw material is scrap steel, which includes
shredded steel. The Company produces a major portion of its shredded steel
requirements from its own shredder operation at the site of the steel mill.
Shredded material, which constitutes approximately 28% of the Company's raw
material mix, is produced by the Company at its facility and is primarily
composed of crushed auto bodies purchased on the open market. Another grade of
scrap steel is #1 Heavy, which constitutes approximately 29% of the Company's
scrap steel requirements and is also purchased on the open market.
Historically, the Company has had an adequate supply of scrap steel for its
operations, and the Company believes that the supply of scrap steel will be
adequate to meet future requirements. The purchase price of scrap steel is
subject to market forces largely beyond the control of the Company. The Company
has historically maintained a scrap inventory commensurate with market
conditions.

The Company's steel mill consumes large amounts of electricity and
natural gas. Electricity is obtained from a local electric utility under an
interruptible supply contract with price adjustments which reflect increases or
decreases in the utility's fuel costs. The Company believes that the savings in
the cost of electricity resulting from the interruption provisions of the
contract offsets any loss which might result from interruptions. Natural gas is
purchased in the open market generally under a one year supply contract. The
Company believes that adequate supplies of both electricity and natural gas are
readily available.

SEASONALITY

While there is generally no seasonality in demand for the Company's
products, production at the mill is normally shut down for up to two weeks each
summer and up to one week in December, in order to conduct comprehensive
maintenance (in addition to normal maintenance performed throughout the year)
and to install capital improvements. During these periods, much of the
equipment in the plant is dismantled, inspected and overhauled. The resulting
lower production during the three month periods ending August and February
affect the Company's financial results for those periods.

MARKETING AND BACKLOG

At present, the Company has approximately 1,100 customers, no one of
which accounted for more than 10% of the Company's products sold in 1994. The
commodity nature of certain of the Company's products is generally not
characteristic of a long lead time order cycle. The Company does not believe
that backlog is a significant factor in its business. While the Company has a
small number of long-term customer contracts, most contracts are for quarterly
customer requirements or for immediate shipment. Orders are generally filled
within 45 days and are cancelable.

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COMPETITION AND OTHER MARKET FACTORS

The Company competes with steel producers, including foreign
producers, on the basis of price, quality and service. Intense sales
competition exists for substantially all of the Company's products. A
substantial portion of the Company's products is sold to the construction
industry.

Both the domestic and foreign steel industries are characterized by
excess mill capacity. Steel producers in the United States have faced strong
competition from producers around the world. The Company believes that its
success in increasing productivity, reducing production costs and shifting into
higher margin product lines should continue to enable it to compete effectively
with both foreign and domestic producers.

ENVIRONMENTAL MATTERS

The operations of the Company and its subsidiaries are subject to
various federal and state environmental laws and regulations. Under these laws
the U.S. Environmental Protection Agency ("EPA") and agencies of state
government have the authority to promulgate regulations which could result in
substantial expenditures for pollution control and solid waste treatment. Three
major areas regulated by these authorities are air quality, water quality and
hazardous waste management. Pursuant to these laws and regulations emission
sources at the Company's facilities are regulated by a combination of permit
limitations and emission standards of statewide application, and the Company
believes that it is in substantial compliance with its permit limitations and
applicable laws and regulations.

The Company's steel mill generates, in the same manner as other
similar steel mills in the industry, electric arc furnace ("EAF") dust that
contains lead, chromium and cadmium. The EPA has listed this EAF dust, which is
collected in baghouses, as a hazardous waste. The Company has contracts with
reclamation facilities in the United States and Mexico pursuant to which such
facilities receive the EAF dust generated by the Company and recover the metals
from the dust for reuse, thus rendering the dust non-hazardous. In addition,
the Company is continually investigating alternative reclamation technologies
and has implemented processes for diminishing the amount of EAF dust generated.

In March 1991, the EPA issued an Administrative Order for Removal
Action requiring the Company, along with several other companies, to undertake
final removal activities (the "Final Activities") at a site to which it had
shipped EAF dust. The Company had participated earlier in preliminary remedial
activities at the site under an Administrative Order on Consent entered into in
January 1986 among the EPA, Chaparral and the other companies. Chaparral's
share of the costs associated with the Final Activities did not have a material
adverse effect on its competitive position, operations or financial condition.

The Company intends to comply with all legal requirements regarding
the environment but since many of them are not fixed, presently determinable,
or are likely to be affected by future legislation or rule making by government
agencies, it is not possible to accurately predict the aggregate future costs
of compliance and their effect on the Company's operations, future net income
or financial condition.

4
7

EMPLOYEES

At May 31, 1994, the Company had 943 employees.

ITEM 2. PROPERTIES

The Company's original steel mill facility in Midlothian, Texas, was
completed in 1975. In 1982, a major expansion of the steel mill, added an
additional electric arc furnace and rolling mill. In 1992, a large beam mill
was commissioned that results in excess rolling capacity over the production
capacity of the melting operation. The Company's real property, plant and
equipment are subject to liens securing its long-term debt.

ITEM 3. LEGAL PROCEEDINGS

From time to time, the Company is involved in litigation relating to
claims arising in the ordinary course of business operations. No material
litigation is pending against or currently affects the Company.

The Company maintains insurance with financially sound insurance
companies against certain risks, which insurance the Company believes to be
adequate in relation to the Company's business. The Company also maintains a
hazardous waste liability policy against certain third party claims.

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

Common stock market prices, dividends and certain other items as shown
in the "Quarterly Stock Prices and Dividends" information located on page 15 of
the Registrant's Annual Report to Stockholders for the year ended May 31, 1994,
are incorporated herein by reference. The restriction on the payment of
dividends described in Note E to the Consolidated Financial Statements entitled
"Long-Term Debt" on page 12 of the Registrant's Annual Report to Stockholders
for the year ended May 31, 1994, is incorporated herein by reference.

ITEM 6. SELECTED FINANCIAL DATA

The "Selected Financial Data" on page five of the Registrant's Annual
Report to Stockholders for the year ended May 31, 1994, is incorporated herein
by reference.

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8

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

The "Management's Discussion and Analysis of Financial Condition and
Results of Operations" on pages three and four of the Registrant's Annual
Report to Stockholders for the year ended May 31, 1994, are incorporated herein
by reference.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The following Consolidated Financial Statements and Supplementary Data
of the Registrant and its subsidiaries, included in the Registrant's Annual
Report to Stockholders for the year ended May 31, 1994, are incorporated herein
by reference:

Consolidated Balance Sheets - May 31, 1994 and 1993
Consolidated Statements of Income - Years ended May 31, 1994,
1993 and 1992
Consolidated Statements of Cash Flows - Years ended May 31, 1994,
1993 and 1992
Consolidated Statements of Stockholders' Equity - Years ended
May 31, 1994, 1993 and 1992
Notes to Consolidated Financial Statements - May 31, 1994
Quarterly Financial Information

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

None

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9

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

Reference is made to "Election of Directors" on page two of the
Registrant's Proxy Statement for the Annual Meeting of Stockholders to be held
October 19, 1994. Information on the directors and executive officers of the
Registrant is presented below:

POSITIONS WITH REGISTRANT, OTHER
--------------------------------
NAME AGE EMPLOYMENT DURING LAST FIVE YEARS
---- --- ---------------------------------

Robert D. Rogers........ 58 Chairman of the Board of the Company; President, Chief Executive Officer and
Director of TXI; Director of Consolidated Freightways, Inc. (2)(3)

Gordon E. Forward....... 58 President, Chief Executive Officer and Director; 1988 to 1991, Cement/ Concrete
Division President of TXI; Director of TXI (2)

Kenneth R. Allen........ 37 1990 to present, Director of Investor Relations of Chaparral Steel and TXI;
1991 to present, Treasurer of TXI; 1988 to 1990, Corporate Financial Manager of
TXI

Dennis E. Beach......... 55 Vice President - Administration

Larry L. Clark.......... 50 October 1993 to present, Vice President - Controller and Assistant Treasurer;
1976 to September 1993, Controller and Assistant Treasurer

David A. Fournie........ 46 1992 to present, Vice President of Operations; 1990 to 1991, General Manager -
Medium Section Mill; 1987 to 1989, Superintendent-Medium Section Mill

Richard M. Fowler....... 51 1990 to present, Senior Vice President - Finance; 1986 to 1990, Vice President
- Finance; Vice President - Finance of TXI

Richard T. Jaffre....... 51 Vice President - Raw Materials

Robert C. Moore......... 60 1990 to present, Vice President - General Counsel and Secretary; 1985 to 1990,
Secretary; Vice President - General Counsel and Secretary of TXI

Libor F. Rostik......... 60 1992 to present, Senior Vice President - Engineering; 1985 to 1991, Vice
President - Engineering

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10

Jeffry A. Werner........ 51 Senior Vice President - Commercial

Peter H. Wright......... 52 1991 to present, Vice President Quality Control and SBQ Sales; 1986 to 1991,
Vice President - Quality Control

Robert Alpert........... 62 1989 to present, Director; Director of TXI and Consolidated Freightways, Inc.;
Chairman of the Board of Alpert Investment Corporation (3)

John M. Belk............ 74 Director; Chairman of the Board of Belk Stores Services, Inc.; Director of
Lowe's Companies, Inc. and Coca-Cola Bottling Co. Consolidated (3)

Gerald R. Heffernan..... 75 Director; 1990 to present, President - G. R. Heffernan & Associates, Ltd.; 1987
to 1990, Chairman of the Board of Co-Steel Inc.; Director of TXI (1) (2)

Gerhard Liener.......... 62 Director; Chief Financial Officer of Daimler-Benz AG; Director of Consolidated
Freightways, Inc. (1)

Eugenio Clariond Reyes.. 51 October 1993 to present, Director; Director General and Chief Executive
Officer, Grupo IMSA. S. A.; President, Mexico - U.S. Chamber of Commerce;
Director, Instituto Tecnologico y de Estudias Superiores de Monterrey, A.C.(1)

(1) Member of the Audit Committee.

(2) Member of the Executive Committee.

(3) Member of the Compensation Committee.

Directors who are not employees of the Company currently receive
$15,000 per year plus $1,000 for each day that a Board and/or a Committee
Meeting is attended. All references to years in the above biographies are
references to calendar years.

8
11

ITEM 11. EXECUTIVE COMPENSATION

The "Executive Compensation" and "Report of the Compensation Committee
on Executive Compensation" on pages five through eight of the Registrant's
Proxy Statement for the Annual Meeting of Stockholders to be held October 19,
1994, is incorporated herein by reference.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The "Security Ownership of Certain Beneficial Owners" on page two and
the "Security Ownership of Management" on page four of the Registrant's Proxy
Statement for the Annual Meeting of Stockholders to be held October 19, 1994,
is incorporated herein by reference.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

No reportable transactions occurred between the Company and any
director, nominee for director, officer or any affiliate of, or person related
to, any of the foregoing since the beginning of the Company's last fiscal year
(June 1, 1993).

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12

PART IV

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

(a)(1) and (2) The response to this portion of Item 14 is submitted as
a separate section of this report.

(a)(3) Listing of Exhibits

3. Articles of Incorporation. (incorporated by reference from
Chaparral Steel Company's Form S-1 Registration No. 33-22103
as filed June 29, 1988)

4. Instruments defining rights of security holders. (incorporated
by reference from Chaparral Steel Company's Form S-1
Registration No. 33-22103 as filed June 29, 1988)

10. Material contracts. (incorporated by reference from Chaparral
Steel Company's Form S-1 Registration No. 33-22103 as filed
June 29, 1988)

11. Statement re: computation of per share earnings.

13. Annual report to security holders--Registrant's annual report
to security holders for its last fiscal year, except for those
portions thereof which are expressly incorporated by reference
in this filing, is furnished for the information of the
Commission and is not to be deemed "filed" as part of this
filing. Since the financial statements in the report have been
incorporated by reference in this filing, the accountant's
certificate is manually signed in the signed copy of this
filing.

21. Subsidiaries of the Registrant.

23. Consents of experts and counsel.

24. Power of Attorney for certain members of the Board of
Directors.

(b) Reports on Form 8-K

No reports on Form 8-K were filed during the quarter ended May
31, 1994.

(d) Financial Statement Schedules -- The response to this portion
of Item 14 is submitted as a separate section of this report.

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13

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the issuer has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized, in the City of
Dallas, State of Texas, on the 25th day of August, 1994.

CHAPARRAL STEEL COMPANY

By: /s/GORDON E. FORWARD
(Gordon E. Forward)
President, Chief
Executive Officer
and Director

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

Signatures Title Date
---------- ----- ----

/s/ROBERT D. ROGERS* Chairman of the Board August 25, 1994
--------------------
(Robert D. Rogers)

/s/GORDON E. FORWARD President, August 25, 1994
-------------------- Chief Executive Officer
(Gordon E. Forward) and Director

/s/RICHARD M. FOWLER Senior Vice President - August 25, 1994
-------------------- Finance
(Richard M. Fowler) Chief Financial and
Accounting Officer

Director August 25, 1994
---------------
(Robert Alpert)

/s/JOHN M. BELK* Director August 25, 1994
----------------
(John M. Belk)

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14

/s/GERALD R. HEFFERNAN* Director August 25, 1994
-----------------------
(Gerald R. Heffernan)

/s/GERHARD LIENER* Director August 25, 1994
------------------
(Gerhard Liener)

/s/EUGENIO CLARIOND REYES* Director August 25, 1994
--------------------------
(Eugenio Clariond Reyes)

*By /s/RICHARD M. FOWLER
(Richard M. Fowler)
Attorney-in-Fact

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15

ANNUAL REPORT ON FORM 10-K

ITEM 14 (A)(1) AND (2), (C) AND (D)

LIST OF FINANCIAL STATEMENTS AND SCHEDULES

FINANCIAL STATEMENT SCHEDULES

CERTAIN EXHIBITS

YEAR ENDED MAY 31, 1994

CHAPARRAL STEEL COMPANY AND SUBSIDIARIES

MIDLOTHIAN, TEXAS

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FORM 10-K

ITEM 14 (a)(1) and (2) and ITEM 14(d)

LIST OF FINANCIAL STATEMENTS AND SCHEDULES

The following consolidated financial statements of Chaparral Steel
Company included in the annual report of the Company to its stockholders for
the year ended May 31, 1994, are incorporated by reference in Item 8:

CHAPARRAL STEEL COMPANY AND SUBSIDIARIES

Consolidated Balance Sheets - May 31, 1994 and 1993
Consolidated Statements of Income - Years ended May 31, 1994, 1993 and
1992
Consolidated Statements of Cash Flows - Years ended May 31, 1994, 1993
and 1992
Consolidated Statements of Stockholders' Equity - Years ended May 31,
1994, 1993 and 1992
Notes to Consolidated Financial Statements - May 31, 1994

The following consolidated financial statement schedules for the years
ended May 31, 1994, 1993 and 1992 are submitted herewith:

Schedule V - Property, plant and equipment
Schedule VI - Accumulated depreciation, depletion and
amortization of property, plant and
equipment
Schedule VIII - Valuation and qualifying accounts
Schedule IX - Short-term borrowings
Schedule X - Supplementary income statement information

All other schedules for which provision is made in the applicable
accounting regulations of the Securities and Exchange Commission are not
required under the related instructions, or are inapplicable and therefore,
have been omitted.

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17

CHAPARRAL STEEL COMPANY AND SUBSIDIARIES

SCHEDULE V--PROPERTY, PLANT AND EQUIPMENT

For the Years Ended May 31, 1994, 1993 and 1992

(In thousands)

Col. A Col. B Col. C Col. D Col. E Col. F
------ ------ ------ ------ ------ ------

Other
Changes--
Balance at Add Balance at
Beginning of Additions (Deduct)-- End of
Classification Period at Cost Retirements Describe Period
-------------- ------------ ---------- ------- -------- -----------

Year ended May 31, 1994:
Buildings and improvements.. $ 46,634 $ 583 $ - $ 47,217
Machinery and equipment..... 430,614 7,222 (3,795) 434,041
Land........................ 1,288 - - 1,288
-------- ------- ------- --------
$478,536 $ 7,805 $(3,795) $482,546
======== ======= ======= ========

Year ended May 31, 1993:
Buildings and improvements.. $ 46,546 $ 88 $ - $ 46,634
Machinery and equipment..... 423,362 7,336 (84) 430,614
Land........................ 1,288 - - 1,288
-------- ------- ------- --------
$471,196 $ 7,424 $ (84) $478,536
======== ======= ======= ========

Year ended May 31, 1992:
Buildings and improvements.. $ 46,149 $ 397 $ - $ 46,546
Machinery and equipment..... 411,283 12,219 (140) 423,362
Land........................ 1,288 - - 1,288
-------- ------- ------- --------
$458,720 $12,616 $ (140) $471,196
======== ======= ======= ========

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CHAPARRAL STEEL COMPANY AND SUBSIDIARIES

SCHEDULE VI--ACCUMULATED DEPRECIATION, DEPLETION AND AMORTIZATION

OF PROPERTY, PLANT AND EQUIPMENT

For the Years Ended May 31, 1994, 1993 and 1992

(In thousands)

Col. A Col. B Col. C Col. D Col. E Col. F
------ ------ ------ ------ ------ ------
(2) (1)
Other
Changes--
Balance at Add Balance at
Beginning of Additions (Deduct)-- End of
Classification Period at Cost Retirements Describe Period
-------------- ------------ ----------- --------- ---------- -----------

Year ended May 31, 1994:
Buildings and improvements.. $ 17,304 $ 2,327 $ - $ - $ 19,631
Machinery and equipment..... 205,670 26,095 (3,736) - 228,029
------------ ----------- --------- ---------- -----------
$ 222,974 $ 28,422 $ (3,736) $ - $ 247,660
============ =========== ========= ========== ===========

Year ended May 31, 1993:
Buildings and improvements.. $ 15,345 $ 1,959 $ - $ - $ 17,304
Machinery and equipment..... 179,234 26,520 (84) - 205,670
------------ ----------- --------- ---------- -----------
$ 194,579 $ 28,479 $ (84) $ - $ 222,974
============ =========== ========= ========== ===========

Year ended May 31, 1992:
Buildings and improvements.. $ 13,073 $ 2,164 $ - $ 108 $ 15,345
Machinery and equipment..... 153,318 23,991 (121) 2,046 179,234
------------ ----------- --------- ---------- -----------
$ 166,391 $ 26,155 $ (121) $ 2,154 $ 194,579
============ =========== ========= ========== ===========

(1) Charges capitalized for the large beam mill.

(2) The annual provisions for depreciation have been computed principally
in accordance with the following ranges of rates:

Buildings and improvements 2% to 5%
Machinery and equipment 5% to 20%

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CHAPARRAL STEEL COMPANY AND SUBSIDIARIES

SCHEDULE VIII--VALUATION AND QUALIFYING ACCOUNTS

For the Years Ended May 31, 1994, 1993 and 1992

(In thousands)

Col. A Col. B Col. C Col. D Col. E
------ ------ ------ ------ ------

Additions
Balance at Charged to Balance at
Beginning Costs and End of
Description of Period Expenses Deductions Period
----------- ----------- ----------- ---------- --------

1994:
Allowance for doubtful accounts........ $3,425 $ 800 $ 377(1) $3,848

1993:
Allowance for doubtful accounts........ $3,425 $ 150 $ 150(1) $3,425

1992:
Allowance for doubtful accounts........ $3,735 $ 450 $ 760(1) $3,425

(1) Uncollectible receivables written off.

17
20

CHAPARRAL STEEL COMPANY AND SUBSIDIARIES

SCHEDULE IX--SHORT-TERM BORROWINGS

For the Years Ended May 31, 1994, 1993 and 1992

(Dollars in thousands)

Col. A Col. B Col. C Col. D Col. E Col. F
------ ------ ------ ------ ------ ------

Average Weighted
Maximum Amount Average
Weighted Amount Outstanding Interest Rate
Balance at Average Outstanding During During
End of Interest During the Period the Period
Classification Period Rate the Period (1) (2)
-------------- ----------- ---------- ----------- -------- -------------

Borrowings from banks:

Year ended May 31, 1994 $ 15,000 4.34% $20,000 $7,250 4.36%

Year ended May 31, 1993 $ - 6.21% $ 4,000 $ - (3) - (3)

Year ended May 31, 1992 $ - 6.51% $13,000 $4,500 7.12%

(1) Computed on total of each month's ending balance divided by twelve.

(2) Computed by dividing interest expense for the period by the Average
Amount Outstanding During the Period.

(3) The Company had no borrowings outstanding at the month-ends during
fiscal 1993.

18
21

CHAPARRAL STEEL COMPANY AND SUBSIDIARIES

SCHEDULE X--SUPPLEMENTARY INCOME STATEMENT INFORMATION

For the Years Ended May 31, 1994, 1993 and 1992

(In thousands)

Col. A Col. B
------ ------

Charge to
Item Costs and Expenses
---- ------------------
1994 1993 1992
---- ---- ----

Maintenance and repairs........................... $52,215 $55,130 $53,930
======= ======= =======
(1) (1)

Depreciation and amortization of intangible
assets, preoperating costs and
similar deferrals................. $ 5,334 $ 5,334 $ 3,322
======= ======= =======

Taxes, other than payroll and income taxes:
Real estate................................... $ 5,164 $ 5,067 $ 3,889
Other......................................... 279 357 511

Royalties and advertising costs did not exceed 1% of total revenues and
therefore are not presented.

(1) Certain items in prior year amounts were reclassified to conform to
current year presentation

19
22
INDEX TO EXHIBITS

EXHIBIT DESCRIPTION
- - ------- -----------
3. Articles of Incorporation. (incorporated by reference from
Chaparral Steel Company's Form S-1 Registration No. 33-22103
as filed June 29, 1988)
4. Instruments defining rights of security holders. (incorporated
by reference from Chaparral Steel Company's Form S-1
Registration No. 33-22103 as filed June 29, 1988)
10. Material contracts. (incorporated by reference from Chaparral
Steel Company's Form S-1 Registration No. 33-22103 as filed
June 29, 1988)
11. Statement re: computation of per share earnings.
13. Annual report to security holders--Registrant's annual report
to security holders for its last fiscal year, except for those
portions thereof which are expressly incorporated by reference
in this filing, is furnished for the information of the
Commission and is not to be deemed "filed" as part of this
filing. Since the financial statements in the report have been
incorporated by reference in this filing, the accountant's
certificate is manually signed in the signed copy of this
filing.
21. Subsidiaries of the Registrant.
23. Consents of experts and counsel.
24. Power of Attorney for certain members of the Board of
Directors.