<PAGE>   1

                                                                  EXHIBIT 19.1





To Our Shareholders:

         The comparative results of operations of Chicago Rivet &  Machine Co.
for the first  quarter of 1997 and 1996 are summarized below.  Results for 1997
include the operations of the Company's H & L Tool division,  which was
acquired in December 1996.

         This discussion contains "forward-looking statements" which are
inherently subject to risks and uncertainties that may cause actual events to
differ materially from those discussed herein.  Factors which may cause such
differences in events include, among other things, fluctuations in general
economic conditions, consumer demand or the price and availability of the
Company's primary raw materials and the ability of the Company to successfully
integrate H & L Tool into its operations.  Therefore, readers are cautioned not
to place undue reliance upon such forward-looking statements.

         Net sales and lease revenues totaled $11,898,645 for the first quarter
of 1997, compared with $5,323,632 recorded during the corresponding period of
1996.  While the Company recorded  higher sales revenues for the majority of
its products in 1997,  the most significant factor affecting comparisons with
the prior period was the additional revenues from the Company's H & L Tool
operation.

         Net income for the first quarter of 1997 amounted to $731,983 or $1.25
per share on 585,748 shares outstanding.  This compares favorably to the first
quarter of 1996, when net income amounted to $350,629 or $.60 per share on
585,748 shares outstanding.  Increased sales volumes were the major factor
contributing to the increase in earnings,  although results were also
influenced by a favorable change in product mix, related to the Company's
traditional products, during the first quarter.    The earnings gains related
to these factors were partially offset by higher interest expense associated
with borrowing in connection with the H & L Tool acquisition.  As  previously
reported,  a portion of H & L Tool's first quarter 1997 operating profits were
offset by the recognition of a portion of the "step-up" value that was assigned
to the purchased inventory of H & L Tool.  This accounting treatment is
required under the purchase accounting provisions of APB Opinion No. 16 and is
intended to reflect that portion of the profit on the sale of purchased
inventory that was earned by the seller, prior to the sale of assets to the
Company.  The effect was to reduce net income by approximately $.20 per share
during the first quarter of 1997, and the full amount of the "step-up" has now
been realized.

         We are pleased with the operating results for the recent quarter.
Operations of  the recently acquired H & L Tool facility are going smoothly,
and current indications suggest that orders from H & L Tool customers continue
to be strong, especially when compared to the orders received from the balance
of our customer base.  The level of incoming orders has generally been somewhat
softer than normal for a number of months.  Although current demand is
approximately even with the year earlier period and should be adequate to
sustain profitable operations, it is unlikely that second quarter results will
match those of the first quarter, unless customer demand improves in the near
future.  We will continue our efforts to solicit additional business from both
new and existing customers and are confident those efforts will ultimately be
successful.

                                      -13-
<PAGE>   2


         The 1997 annual meeting of shareholders will be held at the Company's
headquarters in Naperville, Illinois at 10:00 AM on Tuesday, May 13, 1997.  All
shareholders are cordially invited to attend.  Formal notice of the meeting,
proxy materials and the Company's 1996 Annual Report to Shareholders were
distributed early in April.  If you have not already completed and returned
your proxy, we ask that you do so at your earliest convenience, even if you
plan to attend the meeting.  Thank you.

                              Respectfully yours,


               John A. Morrissey                     John C. Osterman
                   Chairman                               President



April 28, 1997





                                      -14-
<PAGE>   3

                                                                     EXHIBIT 11



                          CHICAGO RIVET & MACHINE CO.
                 Summary of Consolidated Results of Operations

<TABLE>
<CAPTION>
                                                                              For the Three Months Ended:
                                                                              March 31,           March 31,
                                                                                1997                1996      
                                                                              -----------         ----------
<S>                                                                           <C>                 <C>
Net sales and lease revenue ................................................. $11,898,645         $5,323,632
Income before taxes .........................................................   1,165,983            571,611
Income after taxes ..........................................................     731,983            350,629
Net income per share.........................................................        1.25                .60        
 Average shares outstanding..................................................     585,748            585,748    
------------------------------------------------------------------------------------------------------------------      
                                             (All figures subject to year end audit)

</TABLE>




                                      -15-