<PAGE>
                    SECURITIES & EXCHANGE COMMISSION
                                    
                          WASHINGTON, DC, 20459
                                    
                               FORM 10-QSB
                                    
               QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
                 OF THE SECURITIES EXCHANGE ACT OF 1934
                                    
            FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1996
                                           ------------------

                        COMMISSION FILE # 0-8027
                                          ------


                     EASTCO INDUSTRIAL SAFETY CORP.
                  -------------------------------------
         (Exact name of registrant as specified in its charter)
                                    
                                    
                NEW YORK                                   11-1874010 
            -----------------                            --------------
     (State or other jurisdiction of                     (IRS Employer)
     incorporation or organization)


           130 West 10th Street, Huntington Station, NY  11746
           ---------------------------------------------------
          (Address of principal executive offices and zip code)

                             (516) 427-1802
                            ---------------
                       (Issuer's telephone number)

                                    
                                    
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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_________

                                    
State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date.


             Class                      Outstanding at September 30, 1996 
      -----------------------           ---------------------------------
      Common Stock, par value                879,488
      $.12 per share                          

<PAGE>


                     PART I - FINANCIAL INFORMATION
                                    
             EASTCO INDUSTRIAL SAFETY CORP. AND SUBSIDIARIES
             -----------------------------------------------  
                  CONDENSED CONSOLIDATED BALANCE SHEETS
                 ----------------------------------------

<TABLE>
<CAPTION>

                                              September 30,    June 30,
                                                  1996           1996   
                                               -------------   -----------
          ASSETS                                (UNAUDITED)
<S>                                                <C>           <C>
CURRENT ASSETS:
     Cash and cash equivalents                     $  196,271    $  646,030
     Accounts receivable - (less allowance
       for doubtful accounts of $140,000 at
       September 30, 1996 and $155,000 at
       June 30, 1996)                               4,193,908     4,669,070
     Inventories - (notes 2)                        5,882,378     5,230,237
     Other                                            636,761       441,763
                                                   ----------    ----------
          TOTAL CURRENT ASSETS                     10,909,318    10,987,100
                                                   ----------    ----------
PROPERTY, PLANT AND EQUIPMENT, at cost -            2,672,150     2,625,703
     
     Less accumulated depreciation and
     amortization                                   1,375,823     1,347,608
                                                    ---------     ---------
                                                    1,296,327     1,278,095

OTHER ASSETS                                          227,387       206,910
                                                   ----------    ----------
          TOTAL ASSETS                            $12,433,032   $12,472,105
                                                  ===========   ===========
</TABLE>

See accompanying notes.


<PAGE>

             EASTCO INDUSTRIAL SAFETY CORP. AND SUBSIDIARIES
            -------------------------------------------------  
                  CONDENSED CONSOLIDATED BALANCE SHEETS
                  -------------------------------------
<TABLE>
<CAPTION>

                                                September 30,      June 30,
                                                   1996             1996 
                                                 ------------     ---------
LIABILITIES AND SHAREHOLDERS' EQUITY            (UNAUDITED)

<S>                                              <C>             <C>
CURRENT LIABILITIES:
     Loan Payable                                $  5,745,858    $5,853,075
     Current maturities of long-term debt              48,469        56,044
     Accounts payable                               3,344,542     3,234,127
     Accrued expenses                                 251,081       291,341
                                                    ---------     ---------
          TOTAL CURRENT LIABILITIES                 9,389,950     9,434,587
                                                    ---------     ---------

LONG-TERM DEBT, less current maturities               428,024       433,738
                                                     --------       -------
SHAREHOLDERS' EQUITY
     Common stock, $.12 par value;
         authorized - 20,000,000 shares, 
         issued 879,488 shares in September 1996               
         and 765,488 shares in June 1996              105,539        91,859                    
     Additional paid-in capital                     6,899,796     6,742,476
     Retained deficit                              (4,390,277)   (4,230,555)
                                                    ----------    ----------
          TOTAL SHAREHOLDERS' EQUITY                2,615,058     2,603,780
                                                    ----------    ----------

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY        $12,433,032   $12,472,105
                                                  ===========   ===========
</TABLE>


See accompanying notes.

<PAGE>
      
             EASTCO INDUSTRIAL SAFETY CORP. AND SUBSIDIARIES
             -----------------------------------------------
       CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND DEFICIT  
       -----------------------------------------------------------
                                    
<TABLE>
<CAPTION>
                                           Three Months Ended September 30,
                                           --------------------------------
                                                     1996           1995
                                                   --------        -------
<S>                                               <C>            <C> 
Net Sales                                         $6,055,707     $6,522,386

Cost of Sales                                      5,031,730      5,271,764
                                                   ---------      ---------
Gross Profit                                       1,023,977      1,250,622
                                                   ---------      ---------
Selling, general & administrative expenses         1,020,275      1,085,855

Interest expense (NET)                               181,643        194,416

Other income (NET)                                   (18,219)       (12,891)

Settlement with former underwriter                       -           78,000  
                                                     --------       -------
Net loss                                             (159,722)      (94,758)

Opening (deficit)                                  (4,230,555)   (4,240,592)
                                                   -----------    ----------
Closing (deficit)                                 $(4,390,277)  $(4,335,350)
                                                  ------------    ----------
Loss per common share                             $      (.18)  $      (.27)
                                                  ============   ===========
Weighted average number of 
  common shares outstanding                            868,336      356,676 
                                                  ============    ==========
</TABLE>


See accompanying notes.

<PAGE>

             EASTCO INDUSTRIAL SAFETY CORP. AND SUBSIDIARIES
             -----------------------------------------------
             CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
             ----------------------------------------------
<TABLE>
<CAPTION>

                                              Three Months Ended September 30,
                                              -------------------------------
                                                       1996         1995
                                                     ---------     -------
<S>                                                   <C>          <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
     Net (Loss)                                       $(159,722)   $(94,758)
                                                      ---------    --------
     Adjustment to reconcile results of operations
             to net cash effect of operating
             activities:
             Depreciation and amortization               28,215      36,380
             Settlement with former underwriter             -        78,000
     Net changes in assets and liabilities:
        Decrease/(Increase) in accounts receivable      475,162    (607,637)
        (Increase) in inventories                      (652,141)   (644,554)
        (Increase) in other current assets             (194,998)     (2,334)
        (Increase) in other assets                      (20,477)     (4,600)
        Increase in accounts payable                    110,415     220,723
        (Decrease) in accrued expenses                  (40,260)    (37,117)
        (Decrease)/Increase in current maturities 
           of long-term debt                             (7,575)      1,726
                                                       --------      -------

           Total Adjustments                           (301,659)   (959,413)
                                                        --------    -------
           Net cash (used for) operating activities    (461,381) (1,054,171)
                                                       ---------  ---------

CASH FLOWS FROM INVESTING ACTIVITIES:
     Capital expenditures                               (46,447)     (5,650)
                                                        ---------   ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
     Proceeds from exercise of warrants                      -       48,750
     Repayments of long-term debt                        (5,714)    (13,289)
     Borrowings under line of credit agreement        6,897,224   6,948,132
     Repayments under line of credit agreement       (7,004,441) (6,317,740)
     Net proceeds from private placement 
     of common stock                                    171,000        -  
                                                       ---------   ---------
     Net cash provided from financing activities         58,069     665,853
                                                       ---------   ---------

NET (DECREASE) IN CASH                                 (449,759)   (393,968)
                                                        --------   ---------
CASH, beginning of period                               646,030     521,210
                                                        --------   ---------
CASH, end of period                                  $  196,271   $ 127,242
                                                     ===========  =========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
   Cash paid during the period for:
         Interest                                    $  181,643   $ 194,416
                                                     ----------   ---------
         Income taxes                                $      296   $   7,508
                                                     ==========   =========
SUPPLEMENTAL DISCLOSURE OF NON-CASH FINANCING
   ACTIVITIES:
   Issuance of common stock in connection with
      settlement with former underwriter                          $  78,000
                                                                  ---------  

</TABLE>

See accompanying notes.

<PAGE>

             EASTCO INDUSTRIAL SAFETY CORP. AND SUBSIDIARIES
             ------------------------------------------------
          NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
          ----------------------------------------------------


1.   Company's Opinion on Unaudited Financial Statements
     ---------------------------------------------------
In the opinion of the Company, the accompanying unaudited condensed
consolidated financial statements contain all adjustments (consisting of only
normal accruals) necessary to present fairly the condensed consolidated balance
sheets as of September 30, 1996 and June 30, 1996 (audited) and the related
statements of operations and deficit for each of the three months in the
periods ended September 30, 1996 and 1995.

The results of operations for the three months ended September 30, 1996 and
1995 are not necessarily indicative of the results for the entire year.

2.   Inventories
     -----------
     Inventories consist of the following:
                                                September 30,      June 30,
                                                     1996            1996 
                                                  ---------       ---------
        Raw materials                           $ 1,651,664     $ 1,701,676
        Work-in-process                             516,441         514,555
        Finished goods                            3,714,273       3,014,006
                                                  ---------      ----------
        Total                                   $ 5,882,378     $ 5,230,237
                                                  ---------      ----------

3.   Litigation
     ----------
The Company is a party to various asbestos lawsuits alleging damages from
exposure to asbestos products sold by the Company.  Refer to Part II, Other
Information, Item I "Legal Proceedings" in this form 10-QSB and Note 11 to the
June 30, 1996 Audited Consolidated Financial Statements regarding the asbestos
litigation.

<PAGE>

             EASTCO INDUSTRIAL SAFETY CORP. AND SUBSIDIARIES
             -----------------------------------------------
          MANAGEMENT'S DISCUSSION AND ANALYSIS OF CONSOLIDATED
          ----------------------------------------------------
       FINANCIAL CONDITION AND CONSOLIDATED RESULTS OF OPERATIONS
       ----------------------------------------------------------

Liquidity and Capital Resources
-------------------------------
The Company had working capital as of September 30, 1996 of approximately
$1,519,000 as compared to approximately $1,553,000 as of June 30, 1996.  A
substantial portion of the Company's working capital consists of inventory,
which was approximately $5,882,000 and $5,230,000 as of September 30, 1996 and
June 30, 1996, respectively.  The Company is required to maintain substantial
inventories of its numerous products in order to meet the immediate shipping
requirements of its customers who require products on short notice.  The
Company believes that its current working capital position will be sufficient
to satisfy its needs for the current fiscal year.  The Company's working
capital position will be enhanced with the proceeds from its public offering in
November 1996. 

In July 1996, the line of credit with Congress Financial Corporation was
amended and extended until October 1, 1999, with an option by Congress to
extend the loan for an additional year.  The line was increased to $9,000,000
with an interest rate of 1.25% above the prime rate which will be reduced to 1%
above the prime rate subject to the consummation of the public offering by
December 31, 1996 and the net proceeds of the offering being at least
$2,500,000.  In addition, this amended line of credit allows for increased
limits on borrowings on eligible accounts receivable and eligible inventory. 
The amounts outstanding under this agreement at September 30 and June 30, 1996
were $5,746,000 and $5,558,000 respectively.  The Company has $83,000 available
for borrowing at September 30, 1996, after adjusting for its liability for
outstanding checks. 

Net cash used for operating activities was principally a result of an increase
in inventory and other current assets which was partially offset by a decrease
in accounts receivable and an increase in accounts payable.  Cash flows used in
investing activities was for the purchase of property, plant and equipment. 
Cash flows provided by financing activities was principally from a private
placement of the Company's common stock.

At the present time, the Company, together with a variety of defendants, is
party to various asbestos-related lawsuits involving a number of plaintiffs
alleging damages from exposure to asbestos products sold by the Company.  The
Company may become a party to additional asbestos-related actions in the
future.  The Company is also party to other non-asbestos-related litigation. 
The Company cannot, at this time, determine the outcome of this uncertainty.  
To date, the Company's insurance coverage has been adequate and the Company's
costs relative to asbestos litigation against it has not been material.


Results of Operations
---------------------
Net sales for the three months ended September 30, 1996 were $6,056,000 as
compared to $6,522,000 for the three months ended September 30, 1995, a
decrease of $466,000 or 7.1%. Sales in the manufacturing segment decreased 1.8%
to $4,008,000 from $4,080,000 for the same quarter last year, while sales in
the distributing segment decreased 16.3% to $2,048,000 compared to the
comparable quarter last year.  The decrease in sales overall (and for both
segments individually) was due to hurricanes in Puerto Rico that affected both
production and shipments and, therefore, sales for the quarter.  The production
facilities have not been damaged.  Based on sales to date for the second
quarter, these effects proved to be temporary.

The Company's gross profit margin decreased to 16.9% of sales for the first
quarter of fiscal 1997 as compared to 19.2% for the first quarter of fiscal
1996.  The decrease in the gross profit margin is a result of the loss of
production in Puerto Rico where goods are produced that result in higher gross
profits.  In addition, the production efficiencies in Puerto Rico were lower
for this quarter because of the weather related down-time.

Selling, general and administrative expenses for the quarter ended September
30, 1996 were approximately $1,020,000 or 16.8% of sales compared to
approximately $1,086,000 or 16.6% for the same period last year.  The increase
in selling, general and administrative expenses as a percentage of sales was
due to the decrease in sales volume experienced in the quarter and an
expenditure of approximately $30,000 to find alternative sources of long-term
production in Mexico.  The Company continues its efforts to reduce costs. 

<PAGE>

Interest expense was approximately $182,000 for the first quarter of fiscal
1996, a decrease of approximately $13,000 when compared to the same quarter of
fiscal 1996, and was principally due to the decrease in rates charged by
Congress Financial Corporation.

The loss per share was $.18 for the quarter ended September 30, 1996, against
a loss of $.27 per share in the September 30, 1995 quarter, as restated to
reflect a 1 for 10 reverse stock split.  The increase in shares outstanding was
mainly due to shares issued in connection with a private placement that
occurred in the fourth quarter of fiscal 1996 and the first quarter of fiscal
1997.

Risks
-----
From time to time, information provided by the Company or statements made by
its employees, or information provided in its filings with the Securities and
Exchange Commission may contain forward looking information. The Company's
actual future results may differ materially from those projections or
statements made in such forward looking information as a result of various
risks and uncertainties, including but not limited to competition, management,
losses, availability of capital, asbestos litigation for substantial
inventories and Tyvek(R), the absence of dividends, and tax incentives.  There
can be no assurances that asbestos litigation will not have an adverse effect
upon the Company in the future.  There can be no assurances that the Rights and
Standby Offering that the Company filed will be successfully consummated.  The
market price of the Company's Common Stock may be volatile at times in response
to fluctuations in the Company's quarterly operating results, changes in
analyst earnings estimates, market conditions, as well as general conditions
and other factors general to the Company.

<PAGE>

                                PART  II
                                    
                                    
                            OTHER INFORMATION
                                    

Item 1.    LEGAL PROCEEDINGS
           -----------------
           NOT APPLICABLE
     
Item 2.    CHANGES IN SECURITIES
           ---------------------
           On August 12, 1996 a one-for-ten reverse split of the Company's
           common stock became effective.
     
           As a result of the reverse split of the Company's common stock, 
           the Class A Warrants became exercisable at the rate of ten warrants
           for one share at the rate of $13.00 per share. These warrants expire
           April 11, 1999.
          
Item 3.    DEFAULTS UPON SENIOR SECURITIES
           -------------------------------
           NONE

Item 4.    SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
           ---------------------------------------------------
           On August 12, 1996 a special meeting of the shareholders of the
           Company took place at which time the shareholders approved the
           following items by the votes as indicated:
          
           No. 1:    Authorization of amendment to certificate of
                     incorporation to effect a one-for-ten reverse stock
                     split.  (See Exhibit 3.01.1)
               
           FOR 7,831,310   AGAINST 521,458   ABSTAIN  12,102   NOT VOTED    -
               
           No. 2:    Authorization of amendment to certificate of
                     incorporation to authorize preferred stock.  (This
                     authorized 1,000,000 shares of $.01 preferred stock. 
                     See Exhibit 3.01.1)
               
           FOR  5,466,731  AGAINST 386,584  ABSTAIN 173,570  NOT VOTED 2,337,985
               
           No. 3:    Proposal to approve the adoption of the 1996 Incentive
                     Stock Option Plan in the form attached to the Proxy
                     Statement.  (See Exhibit 99.01) 
               
           FOR 5,463,911   AGAINST 424,404  ABSTAIN 171,515  NOT VOTED 2,305,000
               
           No. 4:    Proposal to approve the adoption of the 1996 Non-Qualified
                     Stock Option Plan in the form attached to the Proxy 
                     Statement.  (See Exhibit 99.02)
               
           FOR 5,463,222   AGAINST  542,613  ABSTAIN  53,995 NOT VOTED 2,305,040

<PAGE>

Item 5.    OTHER INFORMATION
           -----------------

           On October 10, 1996 the Company's Registration Statement on
           Form SB-2 (333-09517) became effective.  Pursuant thereto the
           Company granted to all of its holders of outstanding stock of
           record on the close of business on September 24, 1996 in those
           states where qualified, the non-transferable right to subscribe
           for Units until 5:00 p.m. on November 8, 1996 (the "termination
           date") on the basis of 4 Units for every 5 shares of Common
           Stock owned on the record date.  Each Unit consists of 1 share
           of Common Stock and 1 Class B Redeemable Common Stock Purchase
           Warrant.  The offering was for 703,591 Units at $5.00 per Unit
           or a total of $3,517,955.  Upon the Termination Date of the
           Rights Offering a total of 11,517 Units representing $57,585
           had been subscribed for.  Pursuant to the Standby Offering
           described in the Registration Statement, Royce Investment
           Group, Inc. is to acquire 692,074 Units at $5.00 per Unit at
           the closing which is scheduled for November 15, 1996.
      
Item 6.    EXHIBITS AND REPORTS ON FORM 8-K
           --------------------------------
           (a)  The following exhibits are incorporated by reference to the
                Company's Registration Statement on Form SB-2 (333-09517)
                effective October 10, 1996:
          
                3.01.1  Certificate of Amendment to Certificate of Incorporation
                    
                99.01   1996 Incentive Stock Option Plan.

                99.02   1996 Non-Qualified Stock Option Plan.
            
            (b) On August 12, 1996, a Form 8-K was filed under item 5 Other
                Events with respect to the following:
          
                1) Approval of the 1-for-10 reverse split.
                            
                2) Authorization for the issuance of 1,000,000 shares of
                   preferred stock par value $.01 per share.  No shares have
                   been issued thereunder to date.
                            
                3) Approval of a 1996 Incentive Stock Option Plan for the
                   grant of up to 300,000 shares (post-reverse split) which
                   terminates May 13, 2006.
                            
                4) Approval of a 1996 Non-Qualified Stock Option Plan for the
                   grant of up to 300,000 shares (post-reverse split) which
                   terminates May 12, 2006.

<PAGE>

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


Dated: November 14, 1996 

                                        EASTCO INDUSTRIAL SAFETY CORP.


                                       By: /s/ ANTHONY P. TOWELL
                                          ________________________
                                             ANTHONY P. TOWELL
                                             Chief Financial Officer, 
                                             Vice President of Finance, and
                                             Treasurer