UNITED STATES
                       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, 1999
                                            -----------------

                                       or

             TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
-----------  ACT OF 1934


For the transition period from                          to
                               ------------------------    --------------------


                         Commission file number 0-14870
                                                -------

                                   Quipp, Inc.
                        --------------------------------
             (Exact name of registrant as specified in its charter)

                   Florida                                   59-2306191
                   -------                                   ----------
     (State or other jurisdiction of                       (IRS Employer
     incorporation or organization)                      Identification No.)


         4800 NW 157th Street, Miami, Florida                    33014
         -------------------------------------                   -----
        (Address of principal executive offices)               (Zip code)

Registrant's telephone number, including area code  (305) 623-8700
                                                    --------------

           Securities registered pursuant to Section 12(g) of the Act;
                          Common Stock, $.01 per value
                          ----------------------------
                                (Title of Class)

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 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
                                      -----      -----

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of 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 the Form 10-K or any amendment to this
Form 10-K). Yes        No    X
               -----       -----

The aggregate market value of voting stock held by non-affiliates of the
Registrant on February 4, 2000 was approximately $30,194,944. The number of
shares of the Registrant's common stock, $.01 par value, outstanding at February
4, 2000 was 1,887,184.

                       DOCUMENTS INCORPORATED BY REFERENCE

                              Document Incorporated
                              ---------------------

Portions of the Quipp, Inc. Proxy Statement relating to the 2000 Annual Meeting
of Shareholders (to be filed not later than 120 days after the close of the
fiscal year covered by this report on Form 10-K).

                               Where Incorporated
                               ------------------

                                    Part III

*Calculated by excluding all shares held by executive officers and directors of
Registrant without conceding that all such person are "affiliates" of Registrant
for purposes of the federal securities laws.


<PAGE>

                                     PART I

ITEM I - BUSINESS
-----------------

Through our wholly owned subsidiary, Quipp Systems, Inc., we design,
manufacture, service and market post-press material handling equipment to
newspaper publishers. In the post-press stage of newspaper operations,
newspapers move from the pressroom in a continuous stream and are stacked,
bundled and transferred to the shipping docks. Conveyor systems transport
newspapers from the press to stacking machines. The stacks of newspapers are
wrapped and tied, conveyed to the shipping docks, loaded into carts or stored on
pallets for further processing.

The Company's product line includes the following:

Newspaper Stacker - The Series 400 Stacker counts and batches stacks of
newspapers at maximum speeds of 85,000 copies per hour. The Quipp Sport Stacker
(Quipp Sport), marketed to smaller volume newspapers, counts and batches stacks
of newspapers at maximum speeds of 60,000 copies per hour.

Bottomwrapper - The Quipp Viper, our bottomwrapper, applies wrapping paper to
the bottom or three sides of a newspaper stack to protect against product
damage. The Viper can be equipped with an inkjet printing device that enables
the newspaper publisher to provide delivery location and copy count information
on the wrapping paper.

Automatic Cart Loading System - This system accumulates and loads strapped
bundles of newspapers into carts for transportation to remote distribution
centers. Quipp's Automatic Cart Loading System handles bundles of various shapes
and sizes. Upon completion of loading, the cart is discharged from the cart
loader and ready for delivery to the distribution site.

Newspaper Gripper and Conveyor Systems - Our gripper and conveyor systems, which
include the newly developed Quipp-Gripp II (TM), as well as the Quipp Twin-Track
and the Quipp Rollerslat, transport newspapers from pressrooms to various
locations throughout the post-press operation. The conveyor systems include both
horizontal and vertical conveyor modules, which can be integrated with
directional switches and special purpose components to accommodate the layout of
the newspaper plant. The Quipp-Gripp II uses a series of grippers mounted on an
articulating chain to pick up and transport newspapers and other printed
products. Each Quipp-Gripp II gripper carries a single copy of the product. The
Quipp Twin-Track is a twin-belt newspaper conveyor that transports newspapers in
an overlapping stream with maximum surface speeds of approximately 80,000
newspapers per hour. The Quipp Rollerslat conveyor employs an array of
independently rotating rollers and is used in the processing of newspaper stacks
prior to bundling.

Automatic Palletizing System -The palletizing system receives newspaper bundles
from conveyors, stacks the bundles onto a pallet and places stretch wrap film
around the pallet and newspapers to prevent movement during transportation to a
distribution site.

Other Products -We manufacture a variety of other products for post-press
operations, including stream aligners, centering pacers, fold compressors,
newspaper sensors, press production monitors and other equipment.

Original Equipment Manufacturers (OEM) Equipment - We sell various OEM products
to compliment our product line and provide our customers a single source
solution for integrated post-press material handling systems.

Our manufacturing activities consist primarily of the assembly of purchased
components, the fabrication of mechanical parts and the testing of completed
products. We use approximately 360 vendors to supply parts, materials and
components for our various products. We believe that alternative sources of
supply are available for all required components. If necessary, certain machine
parts could be manufactured in our in-house machine shop, which is used
primarily for custom engineering and development of prototype parts.

We market, install and service our products both domestically and
internationally. All of the products have a minimum one-year warranty, and we
have a staff of technicians that provide installation and repair services. In
addition to the manufacture and sale of products, we sell spare parts for our
equipment. In 1999 and 1998, spare parts sales accounted for approximately 7% of
our net sales revenue.

                                       2
<PAGE>

We sell most of our products to newspaper publishers in the United States. Our
foreign sales accounted for 6%, 12% and 18% of total sales in 1999, 1998 and
1997, respectively. The following table indicates the amount of sales by
geographic area during the past three years:

         SALES BY GEOGRAPHIC AREA
                                       1999             1998            1997
         -----------------------------------------------------------------------

         United States             $29,835,263      $23,969,296      $22,281,825
         Far East                      441,194          413,883        2,214,009
         Canada                        354,246          408,728        1,187,003
         Latin America                 849,239        1,827,103          611,787
         Other                         151,889          502,386          723,658
                                   ---------------------------------------------

                                   $31,631,831      $27,121,396      $27,018,282
         -----------------------------------------------------------------------

As of December 31, 1999, our backlog of orders was approximately $10,150,000, as
compared to $10,566,840 on December 31, 1998. The backlog consists of some OEM
products, which generally have lower margins than products we manufacture. We
believe that we will satisfy all orders included in the backlog by the end of
2000. See "Management's Discussion and Analysis of Financial Condition and
Results of Operations - General" in Item 7.

For the years ended December 31, 1999, 1998 and 1997, no single customer
accounted for 10% or more of our net sales. Since our equipment is designed to
have an extended life, our largest customers in a given year are usually
different from the largest customers in any other year.

OEM sales accounted for approximately 9.6%, 3.0% and 2.0% of our total sales in
1999, 1998, and 1997, respectively.

COMPETITION

The newspaper industry has experienced a decrease in size in recent years, as
the number of newspapers in the country has declined. Moreover, in recent years,
there has been consolidation among manufacturers of newspaper material handling
equipment. These developments have increased competition in the industry, and
some of our competitors have much greater financial resources than ours.
Nevertheless, we believe we have been able to compete successfully in this
environment by emphasizing our engineering expertise and the quality and
reliability of our products.

We believe we have two principal competitors for the newspaper post-press
equipment business in the United States, Heidelberg Finishing Systems, a
domestic subsidiary of Heidelberger Druckmaschinen AG, a German company and,
GMA, a domestic subsidiary of Muller-Martini Versand-Systeme AG, a Swiss
company. In addition, there are several companies that compete with respect to
certain of our products. We have experienced competition on the basis of price
with respect to most of our products and anticipate that price competition will
continue.

MARKETING

We have 17 employees on our sales support and direct sales staff. In North
America, we sell our products through five direct sales representatives. In
Latin America, we have one sales representative that works closely with
international dealers to sell our products. We use international dealers to
market and sell products in the rest of the world. Domestically, we market
products by direct solicitation, trade shows and national and regional trade
journal advertising. International marketing efforts are coordinated through the
foreign dealers. Some of the international dealers are commissioned, while
others purchase our products for resale.

PATENTS and TRADEMARKS

We hold 23 U.S. patents, which expire during the period from 2000 to 2015. We
have three patents pending and continue to apply for patent protection when
deemed advisable; however, we believe that the success of our products
ultimately is dependent upon performance, reliability and engineering, and that
our patents are not material to our business. "Quipp" and "Quipp Gripp" are
registered trademarks of Quipp, Inc.

                                       3
<PAGE>

RESEARCH AND DEVELOPMENT

Research and development costs totaled $742,865, $760,256 and $582,839 in 1999,
1998 and 1997 respectively. The majority of Quipp's 1999 research and
development costs represented expenditures for development of the Quipp-Gripp II
and our automatic palletizing system. We introduced these products to the market
at the annual newspaper exposition (NEXPO) held in June 1999, and we expect to
begin shipment of these products in 2000.

EMPLOYEES

As of December 31, 1999, we had 142 full-time employees. None of our employees
are represented by a union and we consider our employee relations to be good.

RISK FACTORS

We are exposed to various types of market risk, including changes in interest
rates. Market risk is the potential loss arising from adverse changes in market
rates and prices such as interest rates. We do not enter into derivatives or
other financial instruments for trading or speculative purposes. Because our
cash and investments exceed short and long-term debt, the exposure to interest
rates relates primarily to our investment portfolio. Due to the short term
maturities of our investments, we believe there is no significant risk arising
from interest rate fluctuations. We are actively managing our investment
portfolios to increase return on investments, but, in order to ensure safety and
liquidity, will only invest in instruments with credit quality where a secondary
market exists. The counterparties are major financial institutions and
government agencies.



                                       4
<PAGE>

EXECUTIVE OFFICERS OF THE REGISTRANT

The names, business experience and ages of the executive officers of Quipp are
listed below:

<TABLE>
<CAPTION>
      Name                      Business Experience During the Past Five Years              Age
      ----                      ----------------------------------------------              ---
<S>                             <C>                                                         <C>
Anthony P. Peri                 Mr. Peri has been President and Chief                        57
                                Executive Officer of Quipp, Inc. and Quipp
                                Systems, Inc., and a director of both
                                companies since April 1998. From May 1997 to
                                March 1998, he was President and Chief
                                Operating Officer of Ctext, Inc. From August
                                1986 to May 1997, Mr. Peri served in various
                                capacities at Harris Publishing Systems
                                Corporation, the most recent of which was
                                Vice President and General Manager.

Christer A. Sjogren             Mr. Sjogren, Executive Vice President of                     57
                                Quipp Systems, Inc. since 1994, has served
                                Quipp Systems in various capacities since
                                1983. He is responsible for engineering
                                functions. Mr. Sjogren has been a director
                                of Quipp Systems, Inc. since 1996.

Jeffrey S. Barocas              Mr. Barocas has been Chief Financial Officer                 52
                                of Quipp, Inc. since July 1996 and a
                                director of Quipp Systems, Inc. since 1998.
                                From 1990 until July 1996, Mr. Barocas was
                                Chief Financial Officer of a US subsidiary
                                of London International Group.

</TABLE>

ITEM 2 - PROPERTIES
-------------------

We operate our business from one facility, located in Miami, Florida. We own the
property and our facility contains approximately 63,170 square feet, of which
approximately 48,300 square feet are utilized for manufacturing operations, and
14,870 square feet are used for administrative functions. We own all of the
equipment used in our manufacturing operations. In the opinion of management,
our properties are adequate and suitable for current operations. We are
considering an expansion of our facility in 2000 to increase future
manufacturing capacity to accommodate sales growth and broader product line
offerings.

ITEM 3 - LEGAL PROCEEDINGS
--------------------------

Not applicable

ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
------------------------------------------------------------

Not applicable


                                       5
<PAGE>

                                     PART II

ITEM 5 - MARKET FOR THE REGISTRANT COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
--------------------------------------------------------------------------------

Our Common Stock, $.01 par value, is traded on the NASDAQ National Market under
the symbol, "QUIP". The following table sets forth the high and low sales prices
of our Common Stock as reported on the NASDAQ National Market for each calendar
quarter in 1999 and 1998:

<TABLE>
<CAPTION>
         -----------------------------------------------------------------------------
                                    1999                              1998
                             High            Low               High             Low
         -----------------------------------------------------------------------------
<S>                         <C>             <C>               <C>              <C>
         First Quarter      $24.00          $16.25            $17.00           $14.75
         Second Quarter      21.75           12.50             19.13            15.50
         Third Quarter       16.13           12.93             20.38            15.50
         Fourth Quarter      16.50           14.50             19.00            14.50
         -----------------------------------------------------------------------------
</TABLE>

We paid a special dividend of $7.00 per share totaling $13,196,008 to
shareholders on May 10, 1999.

As of February 4, 2000 we had approximately 270 record holders of the Common
Stock, including brokers and other nominees.


                                       6

<PAGE>

ITEM 6 - SELECTED FINANCIAL DATA

The selected financial data should be read in conjunction with the financial
statements and related notes and also with Management's Discussion and Analysis
of Financial Condition and Results of Operations, which are included elsewhere
in this Annual Report on Form 10-K. The following selected financial data for
each of the years in the five-year period ended December 31, 1999 has been
derived from our audited balance sheets and related statements of income.
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------------------------
(In thousands, except per share data)                         1999           1998          1997           1996           1995
--------------------------------------------------------------------------------------------------------------------------------
<S>                                                          <C>            <C>           <C>            <C>            <C>
Income Statement Information:
Net sales                                                    $31,632        $27,121       $27,018        $21,568        $23,197
  Gross profit                                                11,483         10,166         9,769          7,864          7,631
  Research and development                                       743            760           583            580            219
  Selling, general and administrative expenses                 5,693          4,925         4,690          4,205          4,295
  Operating profit                                             5,047          4,481         4,517          3,224          3,117
  Net income                                                   3,673          3,348         3,081          2,220          2,096
--------------------------------------------------------------------------------------------------------------------------------
Per Share Amounts:
  Net income per share (basic)                                  2.02           2.05          1.95           1.42           1.34
  Net income per share (diluted)                                1.97           1.96          1.89           1.42           1.34
  Book value per share                                          8.55          13.67         11.58           9.63           8.21
  Market price per share - high                                24.00          20.38         17.50          13.50          16.25
                         - low                                 12.50          14.50          8.25           8.38           6.75
--------------------------------------------------------------------------------------------------------------------------------
Balance Sheet Information
  Current assets                                             $21,972        $28,954       $22,882        $19,496        $18,383
  Total assets                                                24,435         31,278        25,303         22,074         21,267
  Current liabilities                                          7,454          7,834         5,693          5,842          6,855
  Long-term liabilities                                          850            950         1,050          1,150          1,550
  Shareholders' equity                                        16,131         22,494        18,560         15,082         12,863
Weighted average number of equivalent
shares outstanding                                         1,862,116      1,707,366     1,630,213      1,565,765      1,565,765
--------------------------------------------------------------------------------------------------------------------------------
</TABLE>

We paid a special dividend of $7.00 per share totaling $13,196,008 to
shareholders on May 10, 1999; the reduction in shareholders equity in 1999
reflects this dividend.


                                       7

<PAGE>
ITEM 7 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND
-------------------------------------------------------------------------
RESULTS OPERATIONS
------------------

Results of Operations
(Note: All dollar amounts are in thousands)
1999 vs. 1998
<TABLE>
<CAPTION>
                                                              1999                   1998
----------------------------------------------------------------------------------------------
<S>                                                         <C>                      <C>
Net Sales                                                     $ 31,632                $ 27,121
----------------------------------------------------------------------------------------------
Increase (decrease)                                           $  4,511
                                                              %     17
</TABLE>
Our sales growth was primarily in the domestic market. Sales for our core
product lines, stackers and bottomwrappers, continue to be strong. The 1999
sales growth included increased sales of original equipment manufacturers (OEM)
equipment. We sell OEM products to compliment our product line and provide our
customers a single source solution for integrated post-press material handling
systems.
<TABLE>
<CAPTION>
                                                                1999                    1998
----------------------------------------------------------------------------------------------
<S>                                                           <C>                     <C>
Gross Profit                                                  $ 11,483                $ 10,166
----------------------------------------------------------------------------------------------
Increase (decrease)                                           $  1,317
                                                              %     13
Percentage of Net Sales                                             36%                     37%
</TABLE>
The decrease in gross profit as a percentage of net sales is primarily due to
the sale of a higher percentage of OEM equipment, which generally has lower
margins than products we manufacture.
<TABLE>
<CAPTION>
                                                                1999                    1998
-----------------------------------------------------------------------------------------------
<S>                                                            <C>                      <C>
Selling, General and Administrative Expense                   $  5,693                $  4,925
-----------------------------------------------------------------------------------------------
Increase (decrease)                                           $    768
                                                              %     16
Percentage of Net Sales                                             18%                     18%
</TABLE>
The increase in selling, general and administrative expenses was principally due
to higher sales and marketing costs, offset in part by a decrease in
professional fees. The higher sales and marketing costs were due in part to
increased sales. Additionally, we increased spending on trade shows and
advertising in trade journals in order to introduce our two new products, the
automatic palletizer system and the Quipp-Gripp II gripper conveyer. We also
hired a salesperson and sales support staff to improve our sales efforts in
international markets.

The decrease in professional fees reflects reduced spending for legal and
accounting fees. In 1998, the Company incurred professional fees in connection
with an aborted business combination transaction and patent infringement
litigation that we brought against another company. The litigation was settled
in 1998.
<TABLE>
<CAPTION>
                                                                 1999                     1998
--------------------------------------------------------------------------------------------------
<S>                                                          <C>                        <C>
Research and Development                                      $    743                $    760
--------------------------------------------------------------------------------------------------
Increase (decrease)                                           $    (17)
                                                              %     (2)
Percentage of Net Sales                                              2%                      3%
</TABLE>
Research and development costs in 1999 and 1998 were incurred primarily to
develop two new products, the palletizer and the Quipp Gripp II. We expect to
begin shipment of these products in 2000.
<TABLE>
<CAPTION>
                                                                 1999                     1998
--------------------------------------------------------------------------------------------------
<S>                                                           <C>                       <C>
Operating Income                                              $  5,047                $  4,481
--------------------------------------------------------------------------------------------------
Increase (decrease)                                           $    566
                                                              %     13
Percentage of Net Sales                                             16%                     17%
</TABLE>

                                       8
<PAGE>
The increase in the 1999 operating income, as compared to 1998, was principally
a result of the increases in sales volume. The decrease in operating income as a
percentage of net sales is primarily due to the decrease in gross profit as a
percentage of net sales.
<TABLE>
<CAPTION>
                                                                1999                        1998
----------------------------------------------------------------------------------------------------
<S>                                                  <C>                        <C>
Other Income and Expense (Net)                               $       531                $        601
----------------------------------------------------------------------------------------------------
Increase (decrease)                                          $       (70)
                                                             %       (12)
Percentage of Net Sales                                                2%                          2%
</TABLE>
The decrease in other income and expense (net) was due to the decrease in
interest income. This decrease reflected lower cash and cash equivalents and
securities available for sale due the payment of a $13,196,008 special dividend
in May 1999.

Results of Operations

(Note: All dollar amounts are in thousands)
1998 vs. 1997
<TABLE>
<CAPTION>
                                                                 1998                     1997
----------------------------------------------------------------------------------------------------
<S>                                                          <C>                            <C>
Net Sales                                                    $    27,121                $     27,018
----------------------------------------------------------------------------------------------------
Increase (decrease)                                          $       103
                                                             %         0
</TABLE>
In 1998 we experienced record sales of our core products, stackers and
bottomwrappers.
<TABLE>
<CAPTION>
                                                                1998                      1997
----------------------------------------------------------------------------------------------------
<S>                                                          <C>                        <C>
Gross Profit                                                 $    10,166                $      9,769
----------------------------------------------------------------------------------------------------
Increase (decrease)                                          $       397
                                                             %         4
Percentage of Net Sales                                               37%                         36%
</TABLE>
The increase in gross profit was principally the result of an improved sales mix
and continued manufacturing cost control programs. Our core products have a
higher gross profit margin than ancillary products such as conveyors, floor
equipment or OEM equipment. The improved gross profit margin was partially
offset by a reclassification of bad debt allowances of $474,186 to product cost
contingencies (contract reserves). Cost contingencies are anticipated future
additional costs that may be incurred after equipment is shipped and installed,
the customer has been invoiced and revenue is recorded. We record cost
contingencies to match possible future expenses with related revenue.
<TABLE>
<CAPTION>
                                                                1998                        1997
----------------------------------------------------------------------------------------------------
<S>                                                            <C>                      <C>
Selling, General and Administrative Expenses                 $     4,925                $      4,670
----------------------------------------------------------------------------------------------------
Increase (decrease)                                          $       255
                                                             %         5
Percentage of Net Sales                                               18%                         17%
</TABLE>
The increase in selling, general and administrative expense was principally due
to legal and accounting fees incurred in connection with an aborted business
combination and patent infringement litigation that we brought against another
company, which was settled during 1998. The increase was offset in part by a
reclassification of bad debt expense to product cost contingencies, which is
included in cost of goods sold.
<TABLE>
<CAPTION>
                                                                 1998                       1997
----------------------------------------------------------------------------------------------------
<S>                                                          <C>                        <C>
Research and Development                                     $       760                $        583
----------------------------------------------------------------------------------------------------
Increase (decrease)                                          $       177
                                                             %        30
Percentage of Net Sales                                                3%                          2%
</TABLE>
The increase in research and development expenditures from 1997 to 1998
principally related to development of an improved gripper conveyor and the
development of a palletizer.

                                       9
<PAGE>
<TABLE>
<CAPTION>

                                                                 1998                       1997
---------------------------------------------------------------------------------------------------
<S>                                                          <C>                        <C>
Operating Income                                             $     4,481                $     4,517
---------------------------------------------------------------------------------------------------

Increase (decrease)                                          $       (36)
                                                             %       ( 1)
Percentage of Net Sales                                               17%                        17%
</TABLE>

The decrease in the 1998 operating income, as compared to 1997, was principally
a result of increases in research and development and selling, general and
administrative costs, offset by the increase in gross profit. As a percentage of
net sales, operating income remained relatively stable.
<TABLE>
<CAPTION>

                                                                1998                       1997
---------------------------------------------------------------------------------------------------
<S>                                                  <C>                         <C>
Other Income and Expense (Net)                               $       601                $       415
---------------------------------------------------------------------------------------------------

Increase (decrease)                                          $       186
                                                             %        45
Percentage of Net Sales                                                2%                         2%
</TABLE>

The increase in other income and expense (net) was a result of increases in
interest income resulting from higher interest rates and higher balances of
cash, cash equivalents and securities available for sale.

General

The majority of our sales are made on a contract basis. Typically, we receive a
deposit upon the execution of the sales contract. Prior to shipment, we receive
additional installment payments. We normally receive larger orders several
months in advance of delivery. Therefore, backlog can be an important, though by
no means conclusive, indication of our short-term revenue stream. The timing of
revenues can be affected by pending orders, the amount of custom engineering
required, the timetable for delivery, and the receipt and nature of new orders.
Our backlog, as of December 31, 1999 and December 31, 1998, was $10,150,000 and
$10,566,840, respectively. The backlog includes some OEM products, which
generally have lower margins than products we manufacture. Management believes
all orders in the December 31, 1999 backlog will be satisfied by the end of
2000.

Liquidity and Capital Resources

On December 31, 1999, cash, cash equivalents and securities available for sale
totaled $13,339,318, as compared to $20,281,287 at December 31, 1998, a decrease
of $6,941,969. This decrease was primarily due to the payment of a $13,196,008
special cash dividend to shareholders on May 10, 1999. The decrease was
partially offset by cash provided by operations and $2,805,500 received upon the
exercise of stock options. Working capital at December 31, 1999 was $14,518,483,
a decrease of $6,601,998 from $21,120,481 at December 31, 1998. We believe that
our cash, cash equivalents and securities available for sale together with cash
generated from operations will be sufficient to fund operations at the current
level.

Inflation

The rate of inflation has not had a material impact on operations.

Forward Looking Statements

The statements contained in this Annual Report on Form 10-K, including
statements concerning shipment of backlog orders, shipment of automatic
palletizing systems and Quipp Gripp II, the possible expansion of our facilities
and adequacy of available resources, are forward looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. A number of
important factors could cause actual results to differ materially from those in
the forward looking statements including, but not limited to, economic
conditions generally and specifically in the newspaper industry, demand and
market acceptance for new and existing products, the impact of competitive
products and pricing, manufacturing capacity, delays in shipment, cancellation
of customer orders, and engineering and production difficulties.


                                       10
<PAGE>

ITEM 7A - QUALITATIVE AND QUANTATIVE DISCLOSURES ABOUT MARKET RISK
------------------------------------------------------------------

See "Management's Discussion and Analysis of Financial Conditions and Results of
Operations - Risk Factors."

ITEM 8 - FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
----------------------------------------------------

Independent Auditors' Report

Financial Statements:

         Consolidated Balance Sheets as of December 31, 1999 and 1998

         Consolidated Statements of Income for each of the Years in the three-
         year period Ended December 31, 1999

         Consolidated Statements of Shareholders' Equity for Each of the Years
         in the three-year Period Ended December 31,1999

         Consolidated Statements of Cash Flows for each of the Years in the
         three-year period Ended December 31, 1999

         Notes to Consolidated Financial Statements


                                       11
<PAGE>



Independent Auditors' Report

The Board of Directors
Quipp, Inc.:

         We have audited the accompanying consolidated balance sheets of Quipp,
Inc. and subsidiary (the "Company") as of December 31, 1999 and 1998, and the
related consolidated statements of income, shareholders' equity and cash flows
for each of the years in the three-year period ended December 31, 1999. These
consolidated financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these consolidated
financial statements 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 financial position of the Company
as of December 31, 1999 and 1998 and the results of their operations and their
cash flows for each of the years in the three-year period ended December 31,
1999, in conformity with generally accepted accounting principles.

/ s / KPMG LLP
Miami, Florida
February 4, 2000


                                       12

<PAGE>
<TABLE>
<CAPTION>
                                          QUIPP, INC. AND SUBSIDIARY
                                          CONSOLIDATED BALANCE SHEETS
                                          DECEMBER 31, 1999 AND 1998

                                                                                                1999              1998
         -------------------------------------------------------------------------------------------------------------------
<S>                                                                                            <C>              <C>
         ASSETS
         Current assets :
             Cash and cash equivalents                                                         $ 2,868,262      $ 1,820,956
             Securities available for sale                                                      10,471,056       18,460,331
             Accounts receivable, net                                                            4,586,990        4,388,385
             Inventories                                                                         2,617,641        2,989,950
             Deferred tax assets-current                                                           888,719          814,899
             Prepaid expenses and other receivables                                                539,488          479,761
                                                                                           ---------------------------------

         Total current assets                                                                   21,972,156       28,954,282

         Property, plant and equipment, net                                                      2,014,148        1,837,161
         Goodwill                                                                                  374,641          405,861
         Other assets                                                                               74,061           80,782
                                                                                           ---------------------------------

         Total Assets                                                                          $24,435,006      $31,278,086
                                                                                           =================================

         LIABILITIES AND SHAREHOLDERS' EQUITY
         Current liabilities:
            Current portion of long-term debt                                                  $   100,000      $   100,000
            Accounts payable                                                                     1,112,944        1,425,757
            Accrued salaries and wages                                                             850,110          697,136
            Deferred revenues                                                                    3,105,344        3,439,314
            Income taxes payable                                                                     7,482          167,704
            Contract contingencies                                                                 898,192          596,397
            Other accrued liabilities                                                            1,379,601        1,407,493
                                                                                           ---------------------------------

         Total current liabilities                                                               7,453,673        7,833,801

         Long-term debt                                                                            850,000          950,000
         Contingencies (Note 12)                                                                     --               --
                                                                                           ---------------------------------

         Total liabilities                                                                       8,303,673        8,783,801

         Shareholders' Equity:
            Common stock - par value $.01 per share, authorized 8,000,000
               shares, issued and outstanding 1,885,144 shares in 1999 and
               1,644,994 shares in 1998                                                             18,851           16,450
            Additional paid-in capital                                                           8,958,547        5,800,581
            Retained earnings                                                                    7,153,935       16,677,254
                                                                                           ---------------------------------
         Total shareholders' equity                                                             16,131,333       22,494,285

         Total Liabilities and Shareholders' Equity                                            $24,435,006      $31,278,086
                                                                                           =================================
</TABLE>

See accompanying notes to the consolidated financial statements.



                                       13
<PAGE>
<TABLE>
<CAPTION>




                                          QUIPP, INC. AND SUBSIDIARY
                                       CONSOLIDATED STATEMENTS OF INCOME
                                 YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997

                                                                             1999              1998              1997
         -------------------------------------------------------------------------------------------------------------------
<S>                                                                          <C>               <C>              <C>
         Net sales                                                           $31,631,832       $27,121,396      $27,018,282
         Cost of sales                                                       (20,148,851)      (16,955,430)     (17,248,863)
                                                                       -----------------------------------------------------

         Gross profit                                                         11,482,981        10,165,966        9,769,419
                                                                       -----------------------------------------------------

         Other operating income and (expense) items:
            Selling, general and administrative expenses                      (5,693,523)       (4,924,902)      (4,669,692)
            Research and development                                            (742,865)         (760,256)        (582,839)
                                                                       -----------------------------------------------------

         Operating profit                                                      5,046,593         4,480,808        4,516,888

         -------------------------------------------------------------------------------------------------------------------
         Other income (expense):
            Interest income                                                      566,489           646,947          476,430
            Interest expense                                                     (35,745)          (45,473)         (61,704)
                                                                       -----------------------------------------------------
                                                                                 530,744           601,474          414,726

         -------------------------------------------------------------------------------------------------------------------

         Income before income taxes                                            5,577,337         5,082,282        4,931,614

         Income taxes                                                         (1,904,648)       (1,734,637)      (1,850,310)
                                                                       -----------------------------------------------------

         Net income                                                           $3,672,689        $3,347,645       $3,081,304
         -------------------------------------------------------------------------------------------------------------------
         Per share amounts:
            Basic income per common share                                          $2.02             $2.05            $1.95
            Diluted income per common share                                        $1.97             $1.96            $1.89
                                                                       -----------------------------------------------------


         Weighted average number of common and
            common equivalent shares outstanding                               1,862,116         1,707,366        1,630,213
         -------------------------------------------------------------------------------------------------------------------
</TABLE>


See accompanying notes to the consolidated financial statements.


                                       14

<PAGE>
<TABLE>
<CAPTION>

                           QUIPP, INC. AND SUBSIDIARY
                 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
                  YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997

                                                                  Additional                                              Total
                                             Common Stock         Paid-In       Retained         Treasury Stock        Shareholders'
                                        Shares         Amount     Capital       Earnings     Shares         Amount        Equity
------------------------------------------------------------------------------------------------------------------------------------
<S>                                  <C>              <C>        <C>           <C>             <C>         <C>         <C>
 Balances on
   January 1,1997                    1,634,465        $16,345    $5,113,190    $10,248,305     68,700      ($295,400)  $15,082,440
 Net Income                                                                      3,081,304                               3,081,304
 Issuance of shares for
   directors fees                        1,979             20        21,518                                                 21,538
 Exercise of stock options
  (includes tax benefit of $61,963)                                 225,137                   (34,750)       149,425       374,562
------------------------------------------------------------------------------------------------------------------------------------

 Balances
   December 31, 1997                 1,636,444         16,365     5,359,845     13,329,609     33,950       (145,975)   18,559,844
 Net Income                                                                      3,347,645                               3,347,645
 Exercise of stock options
(includes tax benefit of $81,583)        8,550             85       440,736                   (33,950)       145,975       586,796
------------------------------------------------------------------------------------------------------------------------------------

 Balances
   December 31, 1998                 1,644,994         16,450     5,800,581     16,677,254       -              -       22,494,285
 Net Income                                                                      3,672,689                               3,672,689
 Issuance of shares to employees         1,400             14        28,662                                                 28,676
 Special dividend                                                              (13,196,008)                            (13,196,008)
 Exercise of stock options
  (includes tax benefit of $326,191)   238,750          2,387     3,129,304                                              3,131,691
------------------------------------------------------------------------------------------------------------------------------------

 Balances
   December 31, 1999                 1,885,144        $18,851    $8,958,547     $7,153,935       -              -      $16,131,333
====================================================================================================================================
</TABLE>
See accompanying notes to the consolidated financial statements.


                                       15


<PAGE>
<TABLE>
<CAPTION>

                                          QUIPP, INC. AND SUBSIDIARY
                                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 YEARS ENDING DECEMBER 31, 1999, 1998 AND 1997

                                                                               1999             1998              1997
         ---------------------------------------------------------------------------------------------------------------------
<S>                                                                            <C>               <C>               <C>
         Cash provided by operations:
             Net Income                                                        $3,672,689        $3,347,645        $3,081,304
                                                                          ----------------------------------------------------

         Reconciliation of net income to net cash
         Provided by (used in) operations:
             Deferred income taxes                                                (73,820)          401,654           (81,500)
             Depreciation and amortization                                        235,318           337,237           342,845
             Issuance of shares to employees                                       28,676                 -                 -
             Other noncash items - bad debt expense                                88,635                 -            21,538

         Changes in operational assets and liabilities:
             Accounts receivable, net                                            (287,240)           (6,850)        1,693,757
             Inventories                                                          372,309           540,659            64,590
             Other assets and prepaid expenses and other receivables              (53,006)         (417,920)            1,616
             Accounts payables and other accrued liabilities                     (187,731)         (212,339)          690,046
             Contract contingencies                                               301,795           272,906           104,006
             Deferred revenues                                                   (333,970)        2,096,352          (481,935)
             Income tax payable                                                   165,969            65,243           201,221
                                                                          ----------------------------------------------------
         Net cash provided by operations                                        3,929,624         6,424,587         5,637,488
                                                                          ----------------------------------------------------

         Cash flows from investing activities:
             Securities purchased                                             (25,184,169)      (46,948,510)      (54,766,876)
             Securities sold                                                   33,173,444        41,334,062        50,384,823
             Capital expenditures                                                (381,085)         (216,969)         (193,890)
                                                                          ----------------------------------------------------
         Net cash provided by (used in) investing activities                    7,608,190        (5,831,417)       (4,575,943)
                                                                          ----------------------------------------------------

         Cash flows from financing activities:
             Repayment of debt                                                   (100,000)         (100,000)         (700,000)
             Exercise of stock options                                          2,805,500           505,213           312,599
             Special dividend                                                 (13,196,008)                -                 -
                                                                          ----------------------------------------------------
         Net cash provided by (used in) financing activities                  (10,490,508)          405,213          (387,401)
                                                                          ----------------------------------------------------

         Increase in cash and cash equivalents                                  1,047,306           998,383           674,144

         Cash and cash equivalents at beginning of year                         1,820,956           822,573           148,429
         ---------------------------------------------------------------------------------------------------------------------

         Cash and cash equivalents at end of year                             $ 2,868,262       $ 1,820,956         $ 822,573
         ---------------------------------------------------------------------------------------------------------------------

         Supplemental disclosure of noncash Information:
             Tax benefit for exercised stock options                            $ 326,191          $ 81,583          $ 61,963
         Supplemental disclosure of cash payments:
             Interest                                                            $ 35,745          $ 45,473          $ 61,704
             Income taxes                                                      $1,812,500        $1,587,566        $1,375,000
         ---------------------------------------------------------------------------------------------------------------------
</TABLE>


See accompanying notes to the consolidated financial statements.

                                       16

<PAGE>

                           QUIPP, INC. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of consolidation - The accompanying consolidated financial statements
include the accounts of Quipp, Inc. and Quipp Systems, Inc., a wholly owned
subsidiary (collectively, the Company). All material intercompany balances and
transactions have been eliminated in consolidation.

Nature of business - The Company designs, manufactures, services and markets
post-press material handling equipment to newspaper publishers. In the
post-press stage of newspaper operations, newspapers move from the pressroom in
a continuous stream and are stacked, bundled and transferred to the shipping
docks. Conveyor systems transport newspapers from the press to stacking
machines. The stacks of newspapers are wrapped and tied, conveyed to the
shipping docks, loaded into carts or stored on pallets for further processing.

Inventories - Inventories include material, labor and factory overhead, and are
stated at the lower of cost or market. Costs are determined using the first-in,
first-out (FIFO) method.

Accounts Receivable/Deferred Revenue - Most of the Company's sales are made on a
contract basis and require customers to make progress payments. Progress
payments are recorded as deferred revenue when received. Revenue is recognized
upon shipment of the equipment. Installation revenue is recognized upon
completion of installation at the customer's site. Accounts receivable is
presented net of an allowance for doubtful accounts of $306,424 for 1999 and
$217,789 for 1998.

Goodwill - The excess of cost over the fair value of net assets of a purchased
business is recorded as goodwill and amortized using the straight-line method
over 17 years. The Company reviews the carrying value of goodwill for possible
impairment whenever events or changes in circumstances indicate that the
carrying amount of the asset may not be recoverable. Goodwill impairment, if
any, is measured based on projected discounted future operating cash flows using
a discount rate reflecting the Company's average cost of funds. The assessment
of the recoverability of goodwill will be affected if estimated future operating
cash flows are not achieved.

Research and development costs - Research and development costs include
expenditures for the development of new products, significant enhancements of
existing products or production processes, and the design, testing and
construction of prototypes. The Company expenses research and development costs
as they are incurred.

Property, plant and equipment, net - Property, plant and equipment is recorded
at cost. Depreciation is computed using the straight-line method over the
estimated useful lives of the assets. Repairs and maintenance are expensed as
incurred; alterations and major overhauls that improve an asset or extend the
useful lives are capitalized.

Income taxes - Income taxes are accounted for using the liability method under
the provisions of Statement of Financial Accounting Standards (SFAS) No. 109,
"Accounting For Income Taxes." Deferred tax assets and liabilities are
identified based on temporary differences between the financial statements and
the tax bases of assets and liabilities. Deferred tax assets and liabilities are
measured using tax rates that are expected to apply to taxable income in the
year the temporary difference is expected to recover or settle. Tax rate changes
are recognized in the period in which the change occurs.

Cash and cash equivalents - Cash and cash equivalents include all the Company's
operating cash balances, demand deposits and short-term investments with
original maturities of three months or less. The Company classifies investments
with an original maturity of more than three months as securities available for
sale.

Income per share - Basic income per share is based on the weighted average
number of common shares outstanding during the periods presented. Diluted income
per share is computed using the weighted average number of common and dilutive
common equivalent shares outstanding in the periods presented. Dilutive common
equivalent shares assume the exercise of options and warrants, calculated under
the treasury stock method, using the average stock market prices during the
periods.


                                       17
<PAGE>

Securities available for sale - Securities available for sale include
investments that are not held for trading or not intended to be held to
maturity. These instruments are recorded at their fair value. Unrealized holding
gains or losses, net of the related tax effect, are included as a separate
component of shareholders' equity. Realized gains and losses, arising from the
sale of securities, are computed using the specific identification method and
included in net income. Fair value of the securities is determined based upon
market prices or discounted cash flow. A decrease in the market value below
cost, determined to be other than temporary, would result in a reduction in
carrying amount to fair value. This reduction would be charged to income.
Premiums and discounts are amortized or accreted using a method that
approximates the effective yield over the life of the security. Dividend and
interest income is recognized when earned. The Company invests in short term and
variable rate long term securities and believes there is no significant risk
arising from interest rate fluctuations. The Company actively manages its
investment portfolios to increase return on investments, but, in order to ensure
liquidity, will only invest in instruments with credit quality where a secondary
market exists.

Deferred bond financing cost - Deferred bond financing costs were incurred upon
the issuance of industrial revenue bonds (see note 6) and are included in other
assets. These costs are amortized using a method that approximates the effective
yield over the term of the bonds.

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 reported amounts of assets and liabilities, and
disclosure of contingent assets and liabilities at the date of the financial
statements. These estimates could affect the reported amounts of revenues and
expenses. Significant items subject to estimates include the allowance for
doubtful accounts, warranty reserves, provision for cost contingencies on
completed contracts and inventory reserves. Actual results could differ from
those estimates.

Contract contingencies - Contract contingencies are estimates of additional
expenses that may be incurred by the Company after a system is installed and
revenue has been recognized. These costs occur when additional efforts are
required to assure compliance with the customers' specifications. The estimate
is based on the Company's past experience.

Warranty reserve - Warranty reserves are calculated based on the Company's
previous experience with customers' claims arising from the sale of merchandise.
The reserve is computed at 1 1/2% of contract revenue. Additions to this reserve
are charged to selling expense. Warranty reserve is included in other accrued
liabilities.

Impairment of long-lived assets - The Company assesses impairment of long-lived
assets and intangible assets whenever events or changes in circumstances
indicate that the carrying amount of the assets may not be fully recoverable.
Recoverability of assets is evaluated by comparing the net book value of the
asset to the forecasted undiscounted future cash flows of the asset. If such
assets are considered to be impaired, the impairment to be recognized is the
amount by which the net book value of the assets exceeds the fair value of the
assets. Fair value is calculated using discounted future operating cash flows
with a discount rate that reflects the Company's average cost of funds. There
was no impairment of long-lived assets in 1999 and 1998.

Stock-Based compensation -The Company uses the intrinsic value-based method of
accounting prescribed by Accounting Principles Board ("APB") Opinion No. 25,
"Accounting for Stock Issued to Employees," and related interpretations, in
accounting for it stock option plan. Under APB 25, compensation expense is
recorded on the date of grant only if the current market price of the underlying
stock exceeds the exercise price. SFAS No. 123, "Accounting for Stock-Based
Compensation, " established accounting and disclosure requirements using a fair
value-based method of accounting for stock-based employee compensation plans. As
allowed by SFAS No. 123, the Company has elected to continue to apply the
intrinsic value-based method of accounting described above, and has provided the
disclosures required by SFAS No. 123. (see note 7)

Comprehensive income - In June 1997, the Financial Accounting Standards issued
SFAS No. 130, "Reporting Comprehensive Income". SFAS 130 is effective for fiscal
years beginning after December 15, 1997 and establishes standards for reporting
and display of comprehensive income and its components in a full set of
general-purpose financial statements. The adoption of SFAS 130 has had no
significant impact on the Company's financial statements. There were no items of
other comprehensive income at December 31, 1999, 1998, and 1997.

                                       18

<PAGE>
Note 2 - SECURITIES AVAILABLE FOR SALE

Securities available for sale are recorded at fair value and consist primarily
of federal, state and local government obligations and other short-term
investments. As of December 31, 1999 and 1998, the carrying value of securities
available for sale approximates fair value. Securities available for sale at
December 31, 1999 and 1998 consisted of the following:
<TABLE>
<CAPTION>

                                                                Securities Available For Sale
-----------------------------------------------------------------------------------------------------
                                                             1999                           1998
-----------------------------------------------------------------------------------------------------
<S>                                                         <C>                           <C>
Securities:
Bankers Acceptance                                       $    500,000                   $  1,190,309
Commercial Paper                                                    -                      1,000,000
Municipal Securities                                        6,670,000                      7,700,000
Federal Government Agency                                   3,218,000                      6,750,000
Money Market Investments                                            -                      1,719,527
Premiums on Investments                                        83,056                        100,495
                                                -----------------------------------------------------

Total                                                    $ 10,471,056                   $ 18,460,331
                                                =====================================================
</TABLE>

Note 3 - INVENTORIES

Components of inventory as of December 31, 1999 and 1998 were as follows:

<TABLE>
<CAPTION>


                                                              1999                         1998
-----------------------------------------------------------------------------------------------------
<S>                                                       <C>                            <C>
Raw Materials                                             $ 2,152,647                    $ 2,616,640
Work in Process                                               403,689                        179,388
Finished Goods                                                 61,305                        193,922
-----------------------------------------------------------------------------------------------------
Total                                                     $ 2,617,641                    $ 2,989,950
=====================================================================================================
</TABLE>


Note 4 - INCOME TAXES

Income tax expense (benefit) for the years ended December 31, 1999, 1998 and
1997 is as follows:

<TABLE>
<CAPTION>

                                              Current                       Deferred                       Total
<S>                                             <C>                             <C>                       <C>
1999
     U.S. Federal                               $1,801,560                       ($67,609)                 $1,733,951
       State and local                             176,908                         (6,211)                   $170,697
                                          -----------------             ------------------          -----------------
                                                $1,978,468                       ($73,820)                 $1,904,648
                                          -----------------             ------------------          -----------------
1998
     U.S. Federal                               $1,321,958                       $361,461                  $1,683,419
       State and local                              11,025                         40,193                     $51,218
                                          -----------------             ------------------          -----------------
                                                $1,332,983                       $401,654                  $1,734,637
                                          -----------------             ------------------          -----------------
1997
     U.S. Federal                               $1,771,939                       ($74,220)                 $1,697,719
       State and local                             159,871                         (7,280)                   $152,591
                                          -----------------             ------------------          -----------------
                                                $1,931,810                       ($81,500)                 $1,850,310
                                          -----------------             ------------------          -----------------
</TABLE>

                                       19

<PAGE>

The tax effects of the temporary differences that give rise to significant
portions of the deferred tax assets and liabilities as of December 31, 1999 and
1998 are as follows:
<TABLE>
<CAPTION>

---------------------------------------------------------------------------------------------------------------
                                                                               1999                       1998
---------------------------------------------------------------------------------------------------------------
<S>                                                                      <C>                        <C>
Deferred Tax Assets:
     Warranty reserve                                                    $   95,846                 $   91,914
     Inventory obsolescence                                                 107,997                    132,041
     Allowance for bad debts                                                104,397                     78,401
     Contract reserves                                                      287,515                    144,121
     Vacation Accrual                                                        48,618                     72,034
     Unicap                                                                  55,055                     42,970
     Other taxes                                                            125,491                    162,380
     Other                                                                   81,284                    120,051
                                             ------------------------------------------------------------------
Total gross deferred tax assets                                          $  906,203                 $  843,912
Less valuation allowance                                                          -                          -
                                             ------------------------------------------------------------------
Net deferred tax assets                                                  $  906,203                 $  843,912

Deferred Tax Liability:
Depreciation                                                                (17,484)                   (29,013)
                                             ------------------------------------------------------------------
Net current deferred assets                                              $  888,719                 $  814,899
                                             ==================================================================

</TABLE>

In assessing the realizability of deferred tax assets, management considers
whether it is more likely than not that some portion or all of the deferred tax
asset will not be realized. The ultimate realization of deferred tax assets is
dependent upon the generation of future taxable income during the periods in
which those temporary differences become deductible. Management considers the
scheduled reversal of deferred tax liabilities, projected future taxable income,
and tax planning strategies in making this assessment. Based upon the level of
historical taxable income and projections for future taxable income over the
periods which the deferred tax assets are deductible, management believes it is
more likely than not the Company will realize the benefits of these deductible
differences. The amount of the deferred tax asset considered realizable,
however, could be reduced in the near term if estimates of future taxable income
during the carryforward period are reduced.

The following table summarizes the differences between the Company's effective
income tax rate and the statutory federal tax rate for the years ended December
31, 1999, 1998, and 1997:
<TABLE>
<CAPTION>

                                                                            Year Ended December 31,
                                                              -------------------------------------------------
                                                                          1999         1998           1997
                                                              -------------------------------------------------
<S>                                                                      <C>            <C>            <C>
Statutory federal income tax rate                                        34.0%          34.0%          34.0%

Increase resulting from:

State and Local taxes, net of
   Federal income tax benefit                                             2.0            2.0            2.1

Other                                                                    (1.9)          (1.9)           1.4
                                                              -------------------------------------------------

                                                                         34.1%          34.1%          37.5%
                                                              =================================================

</TABLE>




                                       20
<PAGE>

Note 5 - PROPERTY, PLANT AND EQUIPMENT, NET

The property, plant and equipment at December 31, 1999 and 1998 consist of the
following:
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------
                                                                                             Estimated
                                                                                               Useful
                                                                                                life
                                                1999             1998                         (Years)
----------------------------------------------------------------------------------------------------------
<S>                                               <C>              <C>
Land                                              $500,500         $500,500
Building                                         1,431,771        1,431,771                      31
Building Improvements                              415,827          385,720                      10
Machinery                                          798,641          720,050                      5
Furniture and Fixtures                             209,326          201,102                      5
Computer Equipment                                 927,553          660,096                      5
Automobiles                                         88,845          109,433                      5
                                           ---------------- ----------------
                                                 4,372,463        4,008,672
Less: Accumulated depreciation                  (2,358,315)      (2,171,511)
                                           ---------------- ----------------

                                                $2,014,148       $1,837,161
----------------------------------------------------------------------------------------------------------
</TABLE>

Depreciation expense charged to income was $204,098, $213,847 and $196,651 in
1999, 1998, and 1997, respectively.

Note 6 - LONG-TERM DEBT

Industrial Revenue Bonds - On October 4, 1988, the Company borrowed $2,340,000
by issuing, through Dade County Industrial Development Authority, Variable Rate
Industrial Revenue Bonds. The remaining balances of the bonds were $950,000 and
$1,050,000 at December 31, 1999 and 1998, of which $100,000 is classified as
current. The bonds are secured by a letter of credit from a bank, and bore
interest at an average rate of 3.5% and 3.6% during 1999 and 1998, respectively.
The bonds are payable in annual installments of $100,000 in years 2000 through
2007 and $150,000 in 2008. The letter of credit securing the Company's
obligation expires on September 16, 2003.


                                       21

<PAGE>


Note 7 - STOCK OPTION PLANS

1996 Equity Compensation Plan - The Quipp, Inc. 1996 Equity Compensation Plan
(Equity Compensation Plan) provides for grants of stock options and stock-based
awards to employees, certain consultants and advisors of the Company. It also
provides for the grant of stock options to non-employee members of the Company's
Board of Directors. Stock options issued in connection with the Equity
Compensation Plan are granted with an exercise price per share equal to the fair
market value of a share of Company common stock at the date of grant. All stock
options have five to ten-year maximum terms and vest, either immediately, or
within four years of grant date. The total number of shares of common stock
issuable under the Equity Compensation Plan is 600,000.

At December 31, 1999 and 1998, there were 36,000 and 165,500 shares,
respectively, available for grant under the Equity Compensation Plan. Stock
option activity during the periods indicated is as follows:
<TABLE>
<CAPTION>


                                Incentive Stock
                                    Options             Nonqualified Options
                              ------------------      -----------------------
                                        Weighted                    Weighted
                                         Average                     Average
                                        Exercise                    Exercise
                               Shares    Price        Shares          Price
                              ------------------      -----------------------
<S>                            <C>         <C>         <C>              <C>
Balance at December 31, 1997  212,250   $  10.84       53,000       $   10.60
  Granted                      98,500      17.50       35,000           17.13
  Exercised                   (34,500)     10.08       (8,000)          11.80
  Cancellations                (1,500)      9.00           --
                              ------------------      -----------------------
Balance at December 31, 1998  274,750      13.20       80,000           13.44
  Granted                      98,000      14.00       35,000           14.00
  Exercised                  (176,750)     11.20      (62,000)          13.32
  Cancellations                (1,000)     14.00           --              --
                              ------------------      -----------------------
Balance at December 31, 1999  195,000   $  15.26       53,000       $   14.80
                              ------------------      -----------------------
</TABLE>

Using the Black Scholes option-pricing model, the per share average fair value
of stock options granted during 1999, 1998 and 1997 ranged from approximately
$7.40 to $10.25, $5.50 to $8.60 and $11.00 to $11.10, respectively. The
following weighted-average assumptions were used in calculating fair value: an
expected dividend yield of zero and expected lives ranging from five to ten
years for 1999, 1998 and 1997, and a risk-free interest rate of 5.80%, 4.65% and
6.30% for 1999, 1998 and 1997, respectively.

The Company applies APB 25 in accounting for its stock options and, accordingly,
no compensation expense has been recognized for its stock options in the
financial statements. Had the Company determined compensation cost based on the
fair value at the grant date for its stock options under SFAS 123, the Company's
net income and net income per common and common equivalent shares would have
been reduced to the pro forma amounts indicated as follows:
<TABLE>
<CAPTION>

--------------------------------------------------------------------------------------------------------------
                                                     1999                   1998                   1997
--------------------------------------------------------------------------------------------------------------
<S>                                               <C>                    <C>                    <C>
Net Income                       As reported      $3,672,689             $3,347,645             $3,081,304
                                 Pro forma        $2,419,832             $2,747,582             $2,681,076


Net Income per Common and        As reported           $1.97                  $1.96                  $1.89
 Common Equivalent Shares        Pro forma             $1.30                  $1.61                  $1.64
--------------------------------------------------------------------------------------------------------------
</TABLE>


                                       22

<PAGE>

The full impact of calculating compensation expense for stock options under SFAS
123 is not reflected in the pro forma net income amounts presented above because
compensation expense is reflected over the options' vesting period, which could
be up to four years. At December 31, 1999 the range of exercise prices and
remaining contractual life of outstanding options was $9.00 to $17.50, and 1.5
to 9.5 years, respectively. At December 31, 1999, the number of options
exercisable was 79,625, and the weighted-average exercise price of those options
was $15.01 as follows:

<TABLE>
<CAPTION>

                                                                                                         Remaining
                     Range of                            Options                  Options               Contractual
                  Exercise Prices                      Outstanding              Exercisable                 Life
                  ---------------                      -----------              -----------                 ----
<S>                <C>   <C>                                    <C>                      <C>         <C>    <C>
                   $9.00-11.875                                 12,500                   12,500      1.5 to 2.25 years
                   $14.00-17.50                                235,500                   67,125       4.5 to 9.5 years
                                                   --------------------     --------------------
                                                               248,000                   79,625
                                                   ====================     ====================
</TABLE>
Note 8 - EARNINGS PER SHARE
---------------------------

A reconciliation of the number of shares used in computing basic and diluted EPS
follows:
<TABLE>
<CAPTION>

                                                       1999                  1998                   1997
                                       ----------------------------------------------------------------------
<S>                                                  <C>                   <C>                    <C>
Net Income                                           $3,672,689            $3,347,645             $3,081,304

Shares
Basic Shares                                          1,822,783             1,630,706              1,576,556

Common stock
    Equivalents from option plan                         39,333                76,660                 53,657
                                       ----------------------------------------------------------------------

Diluted                                               1,862,116             1,707,366              1,630,213
                                       ----------------------------------------------------------------------

EPS
Basic                                                   $  2.02               $  2.05                $  1.95
Diluted                                                 $  1.97               $  1.96                $  1.89
-------------------------------------------------------------------------------------------------------------
</TABLE>

Note 9 - MAJOR CUSTOMERS

For the years ended December 31, 1999, 1998, and 1997, no single customer
accounted for 10% or more of the Company's net sales. The Company sells a
substantial portion of its products to the domestic newspaper industry; foreign
sales accounted for 6%, 12%, and 18% of total net sales in 1999, 1998 and 1997,
respectively.

Note 10 - EMPLOYEE BENEFIT PLAN

The Quipp Systems, Inc. Employee Savings and Investment Plan (the Savings Plan),
is a defined contribution plan which covers substantially all full-time
employees. The Savings Plan permits eligible employees to contribute up to 20%
of annual compensation, subject to the maximum allowable contribution limits of
Sections 415, 401(k) and 404 of the Internal Revenue Code. In 1999, the Board of
Directors approved an increase in the matching contribution to the Savings Plan
of 50%, up to the first 8% of compensation deferred by each participant. In
1998, the Board of Directors approved an increase in the matching contribution
to the Savings Plan of 50%, up to the first 6% of compensation deferred by each
participant, up from 4% in prior years. The amount contributed by the Company in
1999, 1998, and 1997, was $118,755, $66,588 and $62,889, respectively. The
Company, as sponsor, pays the administrative expenses of the Savings Plan.


                                       23
<PAGE>

Note 11 - FAIR VALUE OF FINANCIAL INSTRUMENTS

The carrying amounts of the Company's financial instruments including cash and
cash equivalents, securities available for sale, accounts receivable, other
assets, prepaid expenses and other receivables, long-term debt, accounts
payable, accrued salaries and wages and other accrued liabilities approximate
fair value.

Note 12 - CONTINGENCIES

In the normal course of business, the Company is exposed to litigation,
including asserted and unasserted claims. In the opinion of management, the
resolution of these matters would not have a material adverse effect on the
Company's financial position, results of operations or liquidity.

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

Not applicable.


                                       24
<PAGE>

                                    PART III

ITEM 10 - DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
------------------------------------------------------------

This information (other than the information relating to executive officers
included in Part I) will be included in our Proxy Statement relating to our
Annual Meeting of Shareholders, which will be filed within 120 days after the
close of our fiscal year covered by this report, and is hereby incorporated by
reference to such Proxy Statement.

ITEM 11 - EXECUTIVE COMPENSATION
--------------------------------

This information will be included in our Proxy Statement relating to our Annual
Meeting of Shareholders, which will be filed within 120 days after the close of
our fiscal year covered by this report, and is hereby incorporated by reference
to such Proxy Statement.

ITEM 12 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
------------------------------------------------------------------------

This information will be included in our Proxy Statement relating to our Annual
Meeting of Shareholders, which will be filed within 120 days after the close of
the Company's fiscal year covered by this report, and is hereby incorporated by
reference to such Proxy Statement.

ITEM 13 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
--------------------------------------------------------

Not applicable




                                       25
<PAGE>

                                     PART IV

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

(a)      1        Financial Statements - See "Index to Financial Statements" in
                  Item 8

         2        All schedules are omitted because they are inapplicable except
                  for:

                  Schedule II - Valuation and Qualifying Accounts

         3        Exhibits  (Note:  The file number of all referenced Annual and
                  Quarterly Reports on Forms 10-K and forms 10-Q, respectively,
                  is 0-14870.)

                  Exhibit No.

                     3.1   Articles of Incorporation, as amended
                           (Incorporated by reference to Exhibit 3 to the
                           Registrant's Quarterly Report on Form 10-Q for the
                           quarter ended June 30, 1998).

                     3.2   By-Laws, as amended (Incorporated by reference to
                           Exhibit 3.2 to the Registrant's Annual Report on Form
                           10K for the fiscal year ended December 31, 1998).

                  10.1.1   Loan Agreement between Dade County Industrial
                           Development Authority and Quipp, Inc. dated as of
                           October 1, 1988 (Incorporated by reference to Exhibit
                           10.4.2 to the Registrant's Annual Report on Form 10-K
                           for the fiscal year ended December 31, 1988).

                  10.1.2   Indenture of Trust between Dade County
                           Industrial Development Authority and Mellon Bank,
                           N.A. dated as of October 31, 1988 (Incorporated by
                           reference to Exhibit 10.4.3 to the Registrant's
                           Annual Report on Form 10-K for the fiscal year ended
                           December 31, 1988).

                  10.1.3   Specimen Bond - Dade County Industrial
                           Development Authority (Incorporated by reference to
                           Exhibit 10.4.4 to the Registrant's Annual Report on
                           Form 10-K for the fiscal year ended December 31,
                           1988).

                  10.1.4   Copy of Promissory Note, dated as of October
                           4, 1988, from Quipp, Inc. to Dade County Industrial
                           Development Authority (Incorporated by reference to
                           Exhibit 10.4.5 to the Registrant's Annual Report on
                           Form 10-K for the fiscal year ended December 31,
                           1988).

                  10.1.5   Reimbursement Agreement among NCNB National
                           Bank of North Carolina, Quipp Systems, Inc. and
                           Quipp, Inc. dated as of October 4, 1988 (Incorporated
                           by reference to Exhibit 10.4.6 to the Registrant's
                           Annual Report on Form 10-K for the fiscal year ended
                           December 31, 1988).

                  10.1.6   Mortgage and Security Agreement from Quipp,
                           Inc. to NCNB National Bank of North Carolina and Dade
                           County Industrial Development Authority dated as of
                           October 1, 1988 (Incorporated by reference to Exhibit
                           10.4.7 to the Registrant's Annual Report on Form 10-K
                           for the fiscal year ended December 31, 1988).

                  10.1.7   Guaranty Agreement among Quipp Systems, Inc.,
                           Quipp Inc., and Dade County Industrial Development
                           Authority dated as of October 1, 1988 (Incorporated
                           by reference to Exhibit 10.4.8 to the Registrant's
                           Annual Report on Form 10-K for the fiscal year ended
                           December 31, 1988).

                  10.1.8   Guaranty Agreement among Quipp Systems, Inc.,
                           Quipp Inc., and NCNB NationsBank of North Carolina
                           dated as of October 1, 1988 (Incorporated by
                           reference to Exhibit 10.4.9 to the Registrant's
                           Annual Report on Form 10-K for the fiscal year ended
                           December 31, 1988).

                  10.1.9   Letter Agreement dated March 26, 1992 between
                           NCNB National Bank of North Carolina and the
                           Registrant dated March 27, 1991 (Incorporated by
                           reference to Exhibit 10.3.9 to the Registrant's
                           Annual Report on Form 10-K for the fiscal year ended
                           December 31, 1990).


                                       26
<PAGE>

                 10.1.10   Amendment to Reimbursement Agreement among
                           NationsBank of North Carolina N.A., Quipp Systems,
                           Inc. and Quipp, Inc. dated as of March 31, 1994
                           (Incorporated by reference to Exhibit 10.2.10 to the
                           Registrant's Annual Report on Form 10-K for the
                           fiscal year ended December 31, 1996).

                   *10.2   Quipp, Inc. 1996 Equity Compensation Plan
                           (Incorporated by Reference to Exhibit 10 to the
                           Registrant's Quarterly Report on Form 10-Q for the
                           fiscal quarter ended June 30, 1998).

                   *10.3   Quipp Systems, Inc. Employee Savings and
                           Investment Plan (Incorporated by reference to Exhibit
                           10.7 to the Registrant's Annual Report on Form 10-K
                           for the fiscal year ended December 31, 1993).

                   *10.4   Quipp Inc. Management Incentive Plan
                           (Incorporated by reference to Exhibit 10.8 to the
                           Registrant's Annual Report on Form 10K for the fiscal
                           year ended December 31, 1998).

                   *10.5   Restated Employment Agreement, dated as of
                           January 25, 1999, among Quipp, Inc, Quipp Systems,
                           Inc. and Christer Sjogren.

                      11   Computation of Net Income Per Share.

                      22   Subsidiary of the Registrant (Incorporated by
                           reference to Exhibit 22 to the Registrant's Annual
                           Report on Form 10-K for the fiscal year ended
                           December 31, 1987).

                      23   Consent of KPMG LLP

                      27   Financial Data Schedule

                           * Constitutes management contract or compensatory
                           plan or arrangement required to be filed as an
                           exhibit to this form.



(b) The Registrant filed no reports on Form 8-K during the last quarter of the
period covered by this report.

                                       27
<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, thereunto duly authorized:

                                            Quipp, Inc.

Date:    March 24, 2000                     By: /s/ Anthony P. Peri
                                            -------------------------
                                            Anthony P. Peri,
                                            President and Chief Executive
                                            Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons in behalf of the registrant and
in the capacities and on the dates indicated:
<TABLE>
<CAPTION>

Signature                           Title                                                 Date
---------                           -----                                                 ----

<S>                                 <C>                                                   <C>
/ s / Anthony P. Peri
---------------------
ANTHONY P. PERI                     Chief Executive                                       March 24, 2000
                                    Officer and Director

/ s / Richard H. Campbell
-------------------------
RICHARD H. CAMPBELL                 Director                                              March 24, 2000


/ s / Cristina H. Kepner
------------------------
CRISTINA H. KEPNER                  Director                                              March 24, 2000


/ s / William L. Rose
---------------------
WILLIAM L. ROSE                     Director                                              March 24, 2000


/ s / Ralph M. Branca
---------------------
RALPH M. BRANCA                     Director                                              March 24, 2000


/ s / Louis D. Kipp
-------------------
LOUIS D. KIPP                       Director                                              March 24, 2000


/ s / Jeffrey S. Barocas
------------------------
JEFFREY S. BAROCAS                  Principal Financial and                               March 24, 2000
                                    Accounting Officer

</TABLE>

                                       28

<PAGE>
                                   QUIPP, INC.
                           ANNUAL REPORT ON FORM 10-K

                                  EXHIBIT INDEX

                 Exhibit
                   No.

                     3.1   Articles of Incorporation, as amended
                           (Incorporated by reference to Exhibit 3 to the
                           Registrant's Quarterly Report on Form 10-Q for the
                           quarter ended June 30, 1998).

                     3.2   By-Laws, as amended (Incorporated by reference to
                           Exhibit 3.2 to the Registrant's Annual Report on Form
                           10K for the fiscal year ended December 31, 1998).

                  10.1.1   Loan Agreement between Dade County Industrial
                           Development Authority and Quipp, Inc. dated as of
                           October 1, 1988 (Incorporated by reference to Exhibit
                           10.4.2 to the Registrant's Annual Report on Form 10-K
                           for the fiscal year ended December 31, 1988).

                  10.1.2   Indenture of Trust between Dade County
                           Industrial Development Authority and Mellon Bank,
                           N.A. dated as of October 31, 1988 (Incorporated by
                           reference to Exhibit 10.4.3 to the Registrant's
                           Annual Report on Form 10-K for the fiscal year ended
                           December 31, 1988).

                  10.1.3   Specimen Bond - Dade County Industrial
                           Development Authority (Incorporated by reference to
                           Exhibit 10.4.4 to the Registrant's Annual Report on
                           Form 10-K for the fiscal year ended December 31,
                           1988).

                  10.1.4   Copy of Promissory Note, dated as of October
                           4, 1988, from Quipp, Inc. to Dade County Industrial
                           Development Authority (Incorporated by reference to
                           Exhibit 10.4.5 to the Registrant's Annual Report on
                           Form 10-K for the fiscal year ended December 31,
                           1988).

                  10.1.5   Reimbursement Agreement among NCNB National
                           Bank of North Carolina, Quipp Systems, Inc. and
                           Quipp, Inc. dated as of October 4, 1988 (Incorporated
                           by reference to Exhibit 10.4.6 to the Registrant's
                           Annual Report on Form 10-K for the fiscal year ended
                           December 31, 1988).

                  10.1.6   Mortgage and Security Agreement from Quipp,
                           Inc. to NCNB National Bank of North Carolina and Dade
                           County Industrial Development Authority dated as of
                           October 1, 1988 (Incorporated by reference to Exhibit
                           10.4.7 to the Registrant's Annual Report on Form 10-K
                           for the fiscal year ended December 31, 1988).

                  10.1.7   Guaranty Agreement among Quipp Systems, Inc.,
                           Quipp Inc., and Dade County Industrial Development
                           Authority dated as of October 1, 1988 (Incorporated
                           by reference to Exhibit 10.4.8 to the Registrant's
                           Annual Report on Form 10-K for the fiscal year ended
                           December 31, 1988).

                  10.1.8   Guaranty Agreement among Quipp Systems, Inc.,
                           Quipp Inc., and NCNB NationsBank of North Carolina
                           dated as of October 1, 1988 (Incorporated by
                           reference to Exhibit 10.4.9 to the Registrant's
                           Annual Report on Form 10-K for the fiscal year ended
                           December 31, 1988).

                  10.1.9   Letter Agreement dated March 26, 1992 between
                           NCNB National Bank of North Carolina and the
                           Registrant dated March 27, 1991 (Incorporated by
                           reference to Exhibit 10.3.9 to the Registrant's
                           Annual Report on Form 10-K for the fiscal year ended
                           December 31, 1990).


<PAGE>


                 10.1.10   Amendment to Reimbursement Agreement among
                           NationsBank of North Carolina N.A., Quipp Systems,
                           Inc. and Quipp, Inc. dated as of March 31, 1994
                           (Incorporated by reference to Exhibit 10.2.10 to the
                           Registrant's Annual Report on Form 10-K for the
                           fiscal year ended December 31, 1996).

                   *10.2   Quipp, Inc. 1996 Equity Compensation Plan
                           (Incorporated by Reference to Exhibit 10 to the
                           Registrant's Quarterly Report on Form 10-Q for the
                           fiscal quarter ended June 30, 1998).

                   *10.3   Quipp Systems, Inc. Employee Savings and
                           Investment Plan (Incorporated by reference to Exhibit
                           10.7 to the Registrant's Annual Report on Form 10-K
                           for the fiscal year ended December 31, 1993).

                   *10.4   Quipp Inc. Management Incentive Plan
                           (Incorporated by reference to Exhibit 10.8 to the
                           Registrant's Annual Report on Form 10K for the fiscal
                           year ended December 31, 1998).

                   *10.5   Restated Employment Agreement, dated as of
                           January 25, 1999, among Quipp, Inc, Quipp Systems,
                           Inc. and Christer Sjogren.

                      11   Computation of Net Income Per Share.

                      22   Subsidiary of the Registrant (Incorporated by
                           reference to Exhibit 22 to the Registrant's Annual
                           Report on Form 10-K for the fiscal year ended
                           December 31, 1987).

                      23   Consent of KPMG LLP

                      27   Financial Data Schedule

                           * Constitutes management contract or compensatory
                           plan or arrangement required to be filed as an
                           exhibit to this form.