SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                   FORM 10-QSB
(Mark One)
[ X ] Quarterly Report Under Section 13 or 15(d) of the Securities  Exchange Act
of 1934 For the quarterly period ended June 30, 1999

[ ] Transition  Report Under Section 13 or 15(d) of the Securities  Exchange Act
of 1934 For the transition period from ____________ to ____________


Commission File Number:  001-13387

                                AeroCentury Corp.
                 (Name of small business issuer in its charter)
    Delaware                                              94-3263974
(State or other jurisdiction of            (I.R.S. Employer Identification No.)
 incorporation or organization)

   1440 Chapin Avenue, Suite 310
   Burlingame, California                                                94010
  (Address of principal executive offices)                           (Zip Code)

Issuer's telephone number, including area code:  (650) 340-1888

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

Title of Each Class                        Name of Exchange on Which Registered
Common Stock, $0.001 par value                        American Stock Exchange

Securities registered pursuant to Section 12(g) of the Act:  None

Check whether the Issuer:  (1) filed all reports required to be filed by Section
13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months (or
for such shorter  period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days.
Yes  X  No
    ---   ---

As of August 16,  1999 the  Issuer  has  1,606,557  Shares  of  Common  Stock
outstanding, of which 55,400 are held as Treasury Stock.

Transitional Small Business Disclosure Format (check one): Yes        No  X
                                                              ------     ------

<PAGE>



Part I.       Financial Information

Item 1.       Financial Statements

                                AeroCentury Corp.
                                  Balance Sheet

<TABLE>
<S>                                                                             <C>

                                     ASSETS
                                                                                      June 30,
                                                                                        1999


Cash and cash equivalents                                                         $     1,312,740
Deposits                                                                                3,151,550
Accounts and notes receivable                                                             598,120
Aircraft and aircraft engines on operating leases,
     net of accumulated depreciation of $16,359,470                                    29,764,750
Prepaid expenses and other                                                                407,740
                                                                                  ---------------

Total assets                                                                      $    35,234,900
                                                                                  ===============


                      LIABILITIES AND SHAREHOLDERS' EQUITY

Liabilities:
     Accounts payable and accrued expenses                                        $       354,390
     Notes payable and accrued interest                                                12,879,540
     Maintenance reserves and accrued costs                                             2,833,500
     Security deposits                                                                    699,600
     Prepaid rent                                                                         131,800
     Deferred taxes                                                                     3,218,790
     Taxes payable                                                                        208,270
                                                                                  ---------------

Total liabilities                                                                      20,325,890

Shareholders' Equity:
     Preferred stock, $.001 par value, 2,000,000 shares
        authorized, no shares issued and outstanding                                            -
     Common stock, $.001 par value, 3,000,000 shares
        authorized, 1,606,557 shares issued and outstanding                                 1,610
     Paid in capital                                                                   13,821,200
     Retained earnings                                                                  1,504,420
                                                                                  ---------------
                                                                                       15,327,230
     Treasury stock at cost, 51,400 shares                                              (418,220)
                                                                                  ---------------
Total shareholders' equity                                                             14,909,010
                                                                                  ---------------

Total liabilities and shareholders' equity                                        $    35,234,900
                                                                                  ===============

</TABLE>

The accompanying notes are an integral part of this statement.


<PAGE>



                                AeroCentury Corp.
                            Statements of Operations
<TABLE>
<S>                                <C>                                          <C>


                                         For the Six Months Ended               For the Three Months Ended
                                                 June 30,                                June 30,
</TABLE>
<TABLE>
<S>                                 <C>                <C>                <C>                <C>
                                          1999               1998               1999               1998
                                          ----               ----               ----               ----

Revenues:

     Rent income                    $     2,835,270    $      1,674,890    $     1,439,940     $       864,970
     Gain on disposal of aircraft            98,410                   -             98,410                   -
     Other income                            49,910              21,360             24,710               9,360
                                    ---------------    ----------------    ---------------     ---------------

                                          2,983,590           1,696,250          1,563,060             874,330
                                    ---------------    ----------------    ---------------     ---------------

Expenses:

     Management fees                        479,700             287,850            238,400             146,740
     Depreciation                           648,220             338,080            341,250             175,290
     Interest                               457,050              34,090            247,630              26,000
     Professional fees and
        general and administrative          252,860             160,080            136,820              78,630
                                    ---------------    ----------------    ---------------     ---------------

                                          1,837,830             820,100            964,100             426,660
                                    ---------------    ----------------    ---------------     ---------------

Income before taxes                       1,145,760             876,150            598,960             447,670

Tax provision                               408,530             349,100            202,050             178,660
                                    ---------------    ----------------    ---------------     ---------------

Net income                          $       737,230    $        527,050    $       396,910     $       269,010
                                    ===============    ================    ===============     ===============

Weighted average common
   shares outstanding                     1,580,956           1,606,557          1,569,232           1,606,557
                                    ===============    ================    ===============     ===============

Basic earnings per share            $          0.47    $           0.33    $          0.25     $          0.17
                                    ===============    ================    ===============     ===============

</TABLE>

The accompanying notes are an integral part of this statement.





<PAGE>



                                AeroCentury Corp.
                            Statements of Cash Flows

<TABLE>
<CAPTION>


                                                                          For the Six Months Ended June 30,

<S>                                                                 <C>                       <C>
                                                                           1999                       1998

Net cash provided by operating activities                            $     1,000,760           $     1,686,680

Investing activity -
   Purchase of aircraft                                                  (7,600,000)               (1,124,470)
                                                                     ---------------           ---------------
Net cash used by investing activities                                    (7,600,000)               (1,124,470)

Financing activities:
   Issuance of notes payable                                               6,400,000                         -
   Purchase of treasury stock                                              (340,030)                         -
   Issuance of secured note                                                        -                   866,670
                                                                     ---------------           ---------------
Net cash provided by financing activities                                  6,059,970                   866,670

Net change from consolidation of partnerships                                      -                    22,860
                                                                     ---------------           ---------------

Net (decrease)/increase in cash and cash equivalents                       (539,270)                 1,451,740

Cash and cash equivalents, beginning of period                             1,852,010                     7,980
                                                                     ---------------           ---------------

Cash and cash equivalents, end of period                             $     1,312,740           $     1,459,720
                                                                     ===============           ===============

</TABLE>

The accompanying notes are an integral part of this statement.


<PAGE>



                                AeroCentury Corp.
                          Notes to Financial Statements
                                  June 30, 1999

1.       Organization and Summary of Significant Accounting Policies

(a)      Basis of Presentation

         AeroCentury  Corp.  (the  "Company") was  incorporated  in the state of
Delaware on February 28, 1997.  The Company was formed solely for the purpose of
acquiring JetFleet Aircraft,  L.P. and JetFleet Aircraft II, L.P.,  partnerships
formed under  California  law for the purpose of  investing  in leased  aircraft
equipment,  (collectively,  the  "Partnerships")  in  a  statutory  merger  (the
"Consolidation"), which was effective January 1, 1998. The Company is continuing
in the aircraft leasing business in which the Partnerships  engaged and plans to
use leveraged financing to acquire additional aircraft assets on lease.

         Because  greater than 90% of the limited  partnership  units of each of
the  Partnerships  agreed  to  the  Consolidation,  it  has  been  treated  as a
pooling-of-interests  under generally  accepted  accounting  principles with the
assets and liabilities of the combining  entities recorded at historical cost on
the  Consolidation  date.  On January  16,  1998,  the Company was listed on the
American Stock Exchange under the symbol ACY.

         The  accompanying  balance  sheet at June 30,  1999 and  statements  of
operations  and cash flows for the six months  and three  months  ended June 30,
1999 and 1998  reflect all  adjustments  (consisting  of only  normal  recurring
accruals)  which  are,  in the  opinion  of the  Company,  necessary  for a fair
presentation of the financial results.  The results of operations of such period
are not necessarily indicative of results of operations for a full year.

(b)      Organization and Capitalization

         At December 31, 1997, all 150,000 of the Company's  outstanding  shares
were owned by JetFleet  Holding  Corp.  ("JHC"),  a California  corporation.  On
January 1, 1998,  1,456,557  additional common shares were issued as a result of
the Consolidation.

         JetFleet Management Corp. ("JMC"), a wholly owned subsidiary of JHC, is
an integrated aircraft  management,  marketing and financing business.  Prior to
the Consolidation, JMC managed the aircraft assets of the Partnerships on behalf
of their general  partners and limited  partners.  JMC also manages the aircraft
assets of JetFleet III and AeroCentury IV, Inc.,  California  corporations which
are affiliates of JMC.

         On April 17, 1998,  in  connection  with the adoption of a  shareholder
rights plan,  the Company filed a Certificate  of  Designation  designating  the
rights,  preferences and privileges of a new Series A Preferred Stock.  Pursuant
to the plan, the Company issued rights to its shareholders of record as of April
23, 1998,  entitling each shareholder to the right to purchase one one-hundredth
of a share of Series A  Preferred  Stock for each share of Common  Stock held by
the shareholder.  Such rights are exercisable  only under certain  circumstances
concerning a proposed acquisition or merger of the Company.

         On October 23, 1998, the Company's  Board of Directors  adopted a stock
repurchase  plan,  granting  management  the authority to purchase up to 100,000
shares of the Company's common stock, in privately negotiated transactions or on
the market, at such price and on such terms and conditions  deemed  satisfactory
to  management.  During the quarter ended June 30, 1999,  the Company  purchased
33,600  shares of its common  stock and,  since the  adoption  of the plan,  has
purchased 51,400 shares.

(c)      Revenue Recognition

         Revenue  from  leasing of aircraft  assets is  recognized  as operating
lease revenue on a  straight-line  basis over the terms of the applicable  lease
agreements.  Interest income includes interest earned from a finance lease which
expired in June 1998.


<PAGE>



                                AeroCentury Corp.
                          Notes to Financial Statements
                                  June 30, 1999

1.       Organization and Summary of Significant Accounting Policies (continued)

(d)      Aircraft and Aircraft Engines On Operating Leases

         The Company's  interests in aircraft and aircraft  engines are recorded
at cost, which includes  acquisition  costs.  Depreciation is computed using the
straight-line  method over the  aircraft's  estimated  economic life  (generally
assumed to be twelve years),  to an estimated  residual  value.  The depreciable
base of the assets acquired by the Company in the Consolidation was equal to the
net book value of the assets at December 31, 1997.

(e)      Loan Commitment and Related Fees

         To the extent that the Company is required to pay loan  commitment fees
and legal fees in order to secure debt, such fees are amortized over the life of
the related loan.

(f)      Maintenance Reserves and Accrued Costs

         Maintenance  costs under the Company's  triple net leases are generally
the responsibility of the lessees. Maintenance reserves and accrued costs in the
accompanying  balance sheet include  refundable and  non-refundable  maintenance
payments received from lessees.  The Company  periodically  reviews  maintenance
reserves  for  adequacy  in light of the  number of hours  flown,  airworthiness
directives  issued by the manufacturer or government  authority,  and the return
conditions  specified in the lease. As a result of such review,  the Company may
accrue costs for maintenance in excess of amounts received from lessees. At June
30, 1999, the Company had accrued costs of approximately $304,000 related to one
of its aircraft.

(g)      Income Taxes

         The Company follows the liability method of accounting for income taxes
as required by the provisions of SFAS No. 109 Accounting for Income Taxes. Under
the  liability  method,  deferred  income  taxes  are  recognized  for  the  tax
consequences of "temporary  differences" by applying enacted statutory tax rates
applicable  to future  years to  differences  between  the  financial  statement
carrying  amounts  and the tax bases of  existing  assets and  liabilities.  The
effect on deferred taxes of a change in the tax rates is recognized in income in
the period that includes the enactment date.

(h)      Cash and Cash Equivalents/Deposits

         The Company  considers highly liquid  investments  readily  convertible
into known amounts of cash, with original maturities of 90 days or less, as cash
equivalents.  Deposits  represent  cash  balances  held  related to  maintenance
reserves and security deposits and are subject to withdrawal restrictions.

         At June 30, 1999,  the Company  held  refundable  security  deposits of
$699,600,  refundable  maintenance  reserves received from lessees of $1,820,940
and non-refundable maintenance reserves of $631,010.

         The Company's  leases are typically  structured so that if any event of
default  occurs  under the lease,  the Company may apply all or a portion of the
lessee's   refundable  security  deposit  to  cure  such  default.  If  such  an
application of the security deposit is made, the lessee typically is required to
replenish  and  maintain  the full  amount of the  security  deposit  during the
remaining term of the lease.


<PAGE>



                                AeroCentury Corp.
                          Notes to Financial Statements
                                  June 30, 1999

1.       Organization and Summary of Significant Accounting Policies (continued)

(h)      Cash and Cash Equivalents/Deposits (continued)

         Refundable  maintenance reserves may be retained by the Company if such
amounts are necessary to meet the return conditions  specified in the lease and,
in some cases, to satisfy any other payments due under the lease.

         All of  the  security  deposits  currently  held  by  the  Company  are
refundable.   Non-refundable  maintenance  reserves  held  by  the  Company  are
accounted  for as a  liability  until the  aircraft  is sold,  at which time any
excess funds retained by the Company are recorded as income.

(i)      Use of Estimates

The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect certain  reported amounts and  disclosures.  Accordingly,  actual results
could differ from those estimates. 2. Aircraft and Aircraft Engines On Operating
Leases

         At June 30,  1999,  the Company  owned four  deHavilland  DHC-7,  three
deHavilland DHC-6, two Fairchild Metro III, one Shorts SD 3-60 and two Fokker 50
aircraft,  and 25  turboprop  engines.  During the second  quarter of 1999,  the
Company  acquired a 50% interest in a deHavilland  DHC-7  aircraft which was not
subject to a lease. The Company  subsequently  sold its interest in the aircraft
to the  owner of the  other  50%  interest.  The  Company  recognized  a gain in
connection with the sale and received cash and a note due September 30, 1999.

         During the second  quarter,  the  Company  purchased  an Allied  Signal
turboprop  engine used on Fairchild  Metro III  aircraft.  The engine is held in
inventory as a spare and is not subject to a lease or to depreciation.

         The lease for one of the  Company's  DHC-7  aircraft,  serial number 72
("S/N 72")  expired on April 25,  1999.  The Company has been  seeking  re-lease
opportunities for S/N 72 and is discussing lease terms with interested parties.

3.       Notes Payable and Accrued Interest

         On June 30, 1998 the Company  obtained a $15 million  revolving  credit
facility to acquire  turboprop  aircraft and engines under lease.  The facility,
which  expires on June 30,  2000 and which may be renewed  annually  thereafter,
bears interest, payable monthly, at either prime or LIBOR plus 200 basis points,
at the Company's option.  The Company signed agreements  increasing its facility
to  $22.5  million,  then $30  million,  on  April  1,  1999 and July 16,  1999,
respectively.  The Company's  aircraft and aircraft  engines serve as collateral
under the facility and, in  accordance  with the credit  agreement,  the Company
must maintain compliance with certain financial covenants.  As of June 30, 1999,
the Company was in  compliance  with all such  covenants.  As of June 30,  1999,
$12.8 million was outstanding  under the credit facility and interest of $79,540
was accrued, using a combination of prime and LIBOR rates.


<PAGE>



                                AeroCentury Corp.
                          Notes to Financial Statements
                                  June 30, 1999

4.       Income Taxes

         The items comprising income tax expense are as follows:
<TABLE>

<CAPTION>
                                                  For the Six Months Ended June 30,
                                                       1999                1998

<S>                                               <C>                <C>
         Federal                                     $     346,980     $           -
         State                                              16,780                 -
                                                     -------------     -------------

         Current tax provision                             363,760                 -
                                                     -------------     -------------

     Deferred tax provision:
         Federal                                            38,200           297,970
         State                                               6,570            51,130
                                                     -------------     -------------
         Deferred tax provision                             44,770           349,100
                                                     -------------     -------------

     Total provision for income taxes                $     408,530     $     349,100
                                                     =============     =============
</TABLE>

         Total  income  tax  expense  differs  from the  amount  which  would be
provided by applying the statutory federal income tax rate to pretax earnings as
illustrated below:

                                               For the Six Months Ended June 30,
<TABLE>
<S>                                                 <C>                <C>
                                                       1999                1998

         Income tax expense at
               statutory federal income tax rate     $     389,560     $     297,970
         State taxes net of federal benefit                 18,970            51,130
                                                     -------------     -------------
         Total income tax expense                    $     408,530     $     349,100
                                                     =============     =============
</TABLE>

         Temporary   differences  and   carryforwards   which  gave  rise  to  a
significant portion of deferred tax assets and liabilities are as follows:

                                                         June 30,
                                                           1999

         Deferred tax assets:
         Amortization of organizational costs        $      55,200
         Maintenance reserves                              189,110
         Prepaid rent                                       47,000
                                                     -------------
              Net deferred tax assets                      291,310
     Deferred tax liabilities:
         Depreciation on aircraft and engines          (3,151,000)
         Other                                           (359,100)

              Net deferred tax liability             $ (3,218,790)
                                                     =============



<PAGE>



                                AeroCentury Corp.
                          Notes to Financial Statements
                                  June 30, 1999

5.       Supplementary Disclosures of Cash Flow Information

     During  the six months  ended  June 30,  1999 and 1998,  the  Company  paid
interest totaling $417,290 and $34,090, respectively and taxes totaling $135,100
and $2,400, respectively.

6.       Related Party Transactions

         Since the Company has no employees,  the Company's  portfolio of leased
aircraft  assets is managed  and  administered  under the terms of a  management
agreement with JMC. Under this agreement,  JMC receives a monthly management fee
based on the net asset value of the assets  under  management.  During the first
six months of 1999,  the  Company  paid JMC  $446,010  of  management  fees.  In
addition,  JMC may receive a brokerage fee for locating  assets for the Company,
provided that the aggregate  purchase  price  including  chargeable  acquisition
costs and any  brokerage  fee does not exceed the fair market value of the asset
based  on  appraisal,  and a  remarketing  fee in  connection  with  the sale or
re-lease of the  Company's  assets.  The  management  fees,  brokerage  fees and
remarketing  fees may not exceed the customary and usual fees that would be paid
to an unaffiliated party for such services.

         In March 1998, the Company acquired an aircraft on lease using cash and
a loan in the amount of $866,700 from an affiliate.  The Company paid $34,090 of
interest  during the first six months of 1998. The loan was repaid during August
1998.

         Certain  employees of JMC  participate in an employee  stock  incentive
plan which granted  options to purchase shares of the Company held by JHC. As of
June 30, 1999, 2,833 such options had been exercised.

7.       Subsequent Events

         Stock Repurchases

         In August 1999, the Company repurchased 4,000 shares of its common
stock.

         Expansion of Credit Facility

         On July 16, 1999, the Company signed an agreement, increasing its $22.5
million revolving credit facility to $30 million.

         Purchase of Aircraft

         Subsequent  to June 30,  1999,  the  Company  purchased  two Fokker F50
aircraft, on lease to a regional airline operating in Sweden.

         Metro III Lease Extension

         The lease for one of the Company's  Metro III  aircraft,  serial number
576,  ("S/N 576") has been  extended by the lessee from its original  expiration
date on July 19, 1999 to August 19,  1999.  Management  is looking for  re-lease
opportunities for this aircraft.





<PAGE>



Item 2.           Management's Discussion and Analysis or Plan of Operation.

Forward-Looking Statements

Certain statements  contained in this report and, in particular,  the discussion
regarding the Company's beliefs, plans, objectives,  expectations and intentions
regarding:  the positive  effect on net income of the purchase of two additional
aircraft  since June  1999;  the  adequacy  of the  Company's  cash flow to meet
increases in its credit line interest  rate;  the company's  ability to meet its
ongoing  operational  cash flow  needs;  the  Company's  ability  to reduce  the
"off-lease" time for an asset by monitoring and immediate  marketing  responses;
the  Company's  intention  and  ability to  increase  its credit  facility;  the
Company's  intention  to use  proceeds of its credit line to acquire  additional
assets;  the  stability of the air  transport  industry and asset sale and lease
prices; the supply of suitable  transaction  opportunities for the Company;  the
Company's  ability to reduce the impact of an industry  downturn  through proper
asset and lessee selection;  the Company's  exposure to loss as a result of Year
2000 issues;  and the  Company's  ability to obtain credit  enhancement  for its
lessees, such as letters of credit or third party guaranties are forward looking
statements.  While the Company  believes that such statements are accurate,  the
Company's business is dependent upon general economic  conditions,  particularly
those that  affect the demand for  turboprop  aircraft  and  engines,  including
competition  for  turboprop  and other  aircraft,  and future trends and results
cannot be predicted with  certainty.  The Company's  actual results could differ
materially  from  those  discussed  in  such  forward  looking  statements.  The
cautionary  statements made in this Report should be read as being applicable to
all related  forward-looking  statements  wherever  they appear in this  Report.
Factors  that  could  cause or  contribute  to such  differences  include  those
discussed  below  in the  section  entitled  "Factors  that  May  Affect  Future
Results."

Results of Operations

The Company had revenues of $2,983,590 and $1,696,250 and net income of $737,230
and $527,050 for the six months ended June 30, 1999 and 1998, respectively,  and
revenues of $1,563,060  and $874,330 and net income of $396,910 and $269,010 for
the quarters ended June 30, 1999 and 1998, respectively.

Rent income is  approximately  $1,160,000 and $575,000  higher for the six month
and three month  periods in 1999 versus 1998 due to the  purchases of additional
aircraft  on lease  during  the second  half of 1998 and first  quarter of 1999,
which  increases are only  partially  offset by the  off-lease  status of S/N 72
beginning on April 25, 1999.

Management fees are approximately $192,000 and $92,000 higher, respectively,  in
the six and three  months  periods of 1999 versus 1998  because of the  aircraft
acquisitions   noted  above.   Such   acquisitions   had  a  similar  effect  on
depreciation,  which was approximately  $310,000 and $166,000 higher for the six
and three month periods of 1999 versus 1998.

Interest expense is approximately  $423,000 and $222,000 higher in the six month
and three  month  periods  of 1999 than in 1998  because  the  Company's  credit
facility was not used until the fourth  quarter of 1998.  Professional  fees and
general  administrative  expense are approximately $93,000 and $58,000 higher in
six month and three months ended June 30, 1999  primarily  due to an increase in
legal expenses associated with increasing the Company's credit facility.

As  discussed  in Note 7 to the  financial  statements,  the  Company  signed an
agreement during July 1999 to increase its credit facility to $30 million, which
the Company anticipates using to purchase additional  aircraft.  Using a portion
of the increased  credit  facility,  the Company has  purchased  two  additional
aircraft since June 30, 1999. The Company  anticipates these purchases will have
a positive  effect on net  income,  as long as lease  rates and  interest  rates
remain relatively stable.

Liquidity and Capital Resources

The Company is currently  financing its asset growth through  borrowings secured
by its lease  portfolio  and excess  cash flow.  The  Company  has a $30 million
credit  facility which expires on June 30, 2000 and which is renewable  annually
thereafter.  The facility bears interest at either prime or LIBOR plus 200 basis
points,  at the  Company's  option.  As of June  30,  1999,  $12.8  million  was
outstanding under the credit facility and interest of $79,540 was accrued, using
a combination of prime and LIBOR rates.

The prime rate was stable from November 1998 through June 1999 and,  because the
Company did not finance any of its borrowings  using the 30-day LIBOR rate until
June 1999, it had experienced no fluctuations in the LIBOR rate through June 30,
1999.  The Company  believes it has adequate cash flow to meet  increases in the
interest rate  applicable to its credit line  obligations.  Any increase in such
interest  rates is likely  to be the  result of  increased  prevailing  interest
rates.  Increased  prevailing  interest rates  generally  result in higher lease
rates as well, and so an increase in credit line payments may be offset at least
partially by higher  revenues on new leases and renewals of leases  entered into
by the Company. The Company is studying whether it is advisable to enter into an
interest  rate hedge  transaction,  which for a fee would act to lock in current
interest  rates on its credit  line  obligations.  In making its  decision,  the
Company is analyzing  interest rate trends, the ongoing costs of maintaining the
hedge and the magnitude of the impact of any interest rate swing.

It is the Company's  policy to monitor  lessees'  needs in periods before leases
are due to expire.  If it appears  that a lessee will not be renewing its lease,
the Company  immediately  initiates  marketing efforts to locate a potential new
lessee or purchaser for the aircraft.  This  procedure  helps the Company reduce
any potential  that an asset will be  "off-lease"  for a significant  time.  The
lease for S/N 72 expired on April 25,  1999 and the lease for S/N 576 expires on
August 19, 1999. The Company has been seeking re-lease  opportunities for S/N 72
and S/N 576 since the  lessees  provided  notice  that they  would not renew the
leases, and the Company is discussing lease terms with interested  parties.  The
Company's  other  aircraft are subject to leases with varying  expiration  dates
between April 30, 2000 and November 23, 2003.  Given the varying lease terms and
expiration  dates  for  the  aircraft  in the  Company's  portfolio,  management
believes  that the Company  will have  adequate  cash flow to meet any  on-going
operational  needs,  even if S/N 72 and S/N 576 remain off-lease for an extended
period of time.

The Company's  cash flow from  operations for the six months ended June 30, 1999
versus the same  period in 1998  decreased  by  $685,920.  Although  the company
acquired  several aircraft during the second half of 1998 and first half of 1999
which resulted in increased net income and higher depreciation  expense in 1999,
the positive  effect of these changes on cash flow in 1999 were more than offset
by a larger increase in accounts  receivable and prepaid expenses and a decrease
in the amount of maintenance reserves and accrued costs during 1999 versus 1998.
Accounts  receivable at June 30, 1999 includes  $205,000 of rent receivable from
one lessee which was received during July 1999 and a note receivable of $100,000
in connection with the sale of an aircraft, discussed in Note 2 to the financial
statements. Prepaid expenses at June 30, 1999 include amounts paid in connection
with the Company's credit facility which did not exist until June 30, 1998.

Specifically,  the Company's cash flow from  operations for the six months ended
June 30, 1999  consisted  of net income of $737,230 and  adjustments  consisting
primarily of depreciation of $648,220, increases in accounts receivable, prepaid
expenses  and  deposits of  $432,570,  $260,270  and  $1,567,290,  respectively,
increases in accounts and taxes payable of $105,090 and $208,270,  respectively,
an increase  in prepaid  rent of $71,350,  a net  increase in deferred  taxes of
$58,760 and an increase of  $1,392,670  in  security  deposits  and  maintenance
reserves collected from lessees.

The Company's  cash flow from  operations for the six months ended June 30, 1998
consisted  of net income of $527,050  and  adjustments  consisting  primarily of
depreciation of $338,130, increases in accounts receivable, prepaid expenses and
deposits of $54,150, $56,020 and $911,310,  respectively, a decrease in accounts
payable of $186,360,  an increase in prepaid rent of $83,540,  a net increase in
deferred  taxes of $349,100 an increase of $1,596,700  in security  deposits and
maintenance reserves collected from lessees.

The increase in cash flow provided by financing  activities  and the decrease in
cash  flow used by  investing  activities  were  both a result of the  Company's
borrowings on its credit facility to purchase additional aircraft.  As mentioned
above,  the Company did not use its credit  facility until the fourth quarter of
1998.



<PAGE>



Factors that May Affect Future Results

Risks of Debt  Financing.  The Company's use of acquisition  financing under its
revolving  credit  agreement  will  subject  the Company to  increased  risks of
leveraging.  The revolving loans are secured by the Company's existing assets as
well as the assets to be acquired  with the  financing.  Any  default  under the
revolving  credit  agreement could result in foreclosure upon not only the asset
acquired  using such  financing,  but also the  existing  assets of the  Company
securing the revolving loan.

In order to achieve  optimal  benefit from the revolving  credit  facility,  the
Company  intends to repay the revolving  loans from proceeds of subsequent  term
debt or equity financings.  Such replacement financing would provide the Company
with more favorable  long-term repayment terms and also would permit the Company
to make  further  draws under the  revolving  credit line equal to the amount of
revolving  debt  refinanced.  There can be no assurance that the Company will be
able to obtain the necessary amount of replacement term debt or equity financing
on  favorable  terms so as to permit  multiple  draws on the  revolving  line of
credit.

The revolving  line of credit has an initial term of two years  expiring in June
2000, and is renewable at the sole discretion of Lender and its participants, if
any.  There is no  assurance  that the line of credit  will be  renewed.  If the
revolving  loan is not  renewed  by the Lender  and its  participants,  then all
indebtedness  under the revolving  loan agreement will become due and payable on
June 30,  2000.  There is no  assurance  that the  Company  will  have  adequate
replacement  financing  in place in order  to meet  such  accelerated  repayment
obligations.

All of the  Company's  current  credit  line  indebtedness  carries  a  floating
interest  rate based upon  either the  lender's  prime rate or a floating  LIBOR
rate. If the applicable  index rate  increases,  and the Company has not entered
into a mitigating  hedge  transaction,  then the Company's  payment  obligations
under the line of credit  would  increase and could result in lower net revenues
for the Company.

Acquisition of Additional Assets. The Company intends to use the proceeds of its
revolving  credit  facility  to acquire  additional  assets  for the  purpose of
generating income for the Company.  The Company anticipates that it will be able
to expend the entire net  financing  proceeds on the  acquisition  of additional
assets on terms  favorable to the Company,  but the Company has not entered into
any contracts for acquisition of any assets,  and there is no assurance that the
Company will be able to purchase assets or lease such assets on favorable terms.

General Economic Conditions. The market for used aircraft has been cyclical, and
usually  reflects  economic  conditions  and  the  strength  of the  travel  and
transportation industry. The Company believes that the air transport industry is
currently stable, with demand for aircraft,  asset prices and lease rates level,
and in some  cases,  increasing.  Nonetheless  at any time,  the market for used
aircraft  may be  adversely  affected  by  such  factors  as  airline  financial
difficulties,  higher fuel costs, and improved availability and economics of new
replacement aircraft.

The Company  believes that the current aircraft market provides a good supply of
suitable  transaction  opportunities  for the  Company,  primarily  in  overseas
markets,  as well as domestically.  There are currently some disparities between
geographic regions with respect to the condition of the air transport  industry,
with  certain  areas  of South  America  and the  Pacific  Rim,  in  particular,
experiencing  economic  difficulties.  There have also been  disruptions  in the
currency  markets  in  certain   geographic  areas.  To  the  extent  that  such
disruptions  adversely affect a region's economic growth,  suitable transactions
may be more  difficult  for the Company to find in that region and the Company's
lessees in that area may be adversely affected.

An adverse change in the global air travel  industry,  however,  could result in
reduced  carrier revenue and excess capacity and increase the risk of failure of
some weaker regional air carriers.  While the Company  believes that with proper
asset and  lessee  selection  in the  current  climate,  as well as during  such
downturns, the impact of such changes on the Company can be reduced, there is no
assurance  that the Company's  business will escape the effects of such a global
downturn,  or a  regional  downturn  in an area where the  Company  has placed a
significant amount of its assets.

Reliance on JMC. All management of the Company is performed by JMC pursuant to a
Management  Agreement  between JMC and the Company  which has a 20-year term and
provides  for an  asset-based  management  fee.  JMC is not a  fiduciary  to the
Company or its stockholders. The Board of Directors does, however, have ultimate
control and supervisory  responsibility over all aspects of the Company and does
owe fiduciary duties to the Company and its stockholders. In addition, while JMC
may not owe any  fiduciary  duties to the  Company  by virtue of the  Management
Agreement, certain officers of JMC are also officers of the Company, and in that
capacity owe fiduciary  duties to the Company and the  stockholders by virtue of
holding such offices with the Company.

The Management  Agreement may be terminated upon a default in the obligations of
JMC to the  Company,  and  provides  for  liquidated  damages  in the event of a
wrongful  termination  of the agreement by the Company.  Many of the officers of
JMC are also officers of the Company,  and certain  directors of the Company are
also directors of JMC. Consequently,  the directors and officers of JMC may have
a conflict of interest in the event of a dispute  over  obligations  between the
Company and JMC.  Although  the Company has taken steps to prevent  conflicts of
interest arising from such dual roles, such conflicts may still occur.

Ownership  Risks.  Most of the  Company's  portfolio is leased  under  operating
leases,  where the terms of the leases do not take up the entire  useful life of
an asset. The Company's  ability to recover its purchase  investment in an asset
subject  to an  operating  lease is  dependent  upon the  Company's  ability  to
profitably  re-lease  or resell the asset  after the  expiration  of the initial
lease term. Some of the factors that have an impact on the Company's  ability to
release or re-sell  include  worldwide  economic  conditions,  general  aircraft
market  conditions,  regulatory  changes  that  may  make an  asset's  use  more
expensive or preclude use unless the asset is modified, changes in the supply or
cost of aircraft equipment and technological  developments which cause the asset
to become obsolete.  In addition, a successful investment in an asset subject to
an operating  lease depends in part upon having the asset returned by the lessee
in serviceable  condition as required under the lease.  If the Company is unable
to remarket or sell its aircraft equipment on favorable terms when the operating
lease for such equipment expires,  the Company's business,  financial condition,
cash flow,  ability to service debt and results of operation  could be adversely
affected.

Lessee Credit Risk. If a lessee defaults upon his obligations under a lease, the
Company may be limited in its ability to enforce remedies. Most of the Company's
lessees are small domestic and foreign regional passenger airlines, which may be
even  more  sensitive  to  airline  industry  market  conditions  than the major
airlines.  As a  result,  the  Company's  inability  to  collect  rent  under  a
significant  lease or to  repossess  equipment  in the event of a  default  by a
lessee  could have a material  adverse  effect on the  Company's  revenue.  If a
lessee that is a certified U.S.  airline is in default under the lease and seeks
protection under Chapter 11 of the United States  Bankruptcy Code, under Section
1110 of the Bankruptcy Code, the Company would be  automatically  prevented from
exercising  any  remedies  for a  period  of 60  days.  By the end of the 60 day
period,  the lessee must agree to perform the obligations and cure any defaults,
or the Company would have the right to repossess the  equipment.  This procedure
under the  Bankruptcy  Code has been subject to significant  recent  litigation,
however,  and it is possible that the Company's  enforcement rights may still be
further  adversely  affected by a  declaration  of  bankruptcy  by a  defaulting
lessee.

International  Risks.  The  Company  may  focus in the near  term on  leases  in
overseas  markets,  which  markets are  currently  dynamic and which the Company
believes present attractive opportunities. Leases with foreign lessees, however,
may present somewhat different credit risks than those with domestic lessees.

Foreign laws, regulations and judicial procedures may be more or less protective
of lessor  rights as those which apply in the United  States.  The Company could
experience   collection  problems  related  to  the  enforcement  of  its  lease
agreements  under foreign local laws and the remedies in foreign  jurisdictions.
The protections potentially offered by Section 1110 of the Bankruptcy Code would
not apply to non-U.S.  carriers,  and applicable local law may not offer similar
protections.  Certain countries do not have a central  registration or recording
system with which to locally establish the Company's interest in equipment,  and
related  leases.  This could add difficulty in recovering an engine in the event
that a foreign lessee defaults.

Leases with foreign  lessees are subject to risks  related to the economy of the
country  or region in which such  lessee is  located,  even if the U.S.  economy
remains  strong.  On the other hand,  a foreign  economy may remain  strong even
though the domestic U.S. economy is not. A foreign  economic  downturn may occur
and impact a foreign  lessee's  ability to make lease payments,  even though the
U.S. and other economies remain stable. Furthermore, foreign lessees are subject
to risks  related  currency  conversion  fluctuations.  Although  the  Company's
current leases are all payable in U.S. dollars,  in the future,  the Company may
agree to leases that permit  payment in foreign  currency,  which would  subject
such lease  revenue to  monetary  risk due to currency  fluctuations.  Even with
dollar-denominated lease payment provisions, the Company could still be affected
by a devaluation  of the lessee's  local  currency which makes it more difficult
for a lessee to meet its dollar-denominated lease payments,  increasing the risk
of default of that lessee,  particularly if that carrier's  revenue is primarily
derived in the local currency.

Government  Regulation.  There  are  a  number  of  areas  in  which  government
regulation  may  result  in  costs  to  the  Company.   These  include  aircraft
registration,   safety  requirements,   required  equipment  modifications,  and
aircraft  noise  requirements.  Although it is  contemplated  that the burden of
complying with such  requirements will fall primarily upon lessees of equipment,
there  can be no  assurance  that the cost of  complying  with  such  government
regulations  will  not  fall  on the  Company.  Furthermore,  future  government
regulations  could cause the value of any  non-complying  equipment owned by the
Company to substantially decline.

Competition.  The aircraft leasing industry is highly  competitive.  The Company
will  compete  with  aircraft  manufacturers,  distributors,  airlines and other
operators,  equipment managers,  leasing companies,  equipment leasing programs,
financial  institutions  and other  parties  engaged  in  leasing,  managing  or
remarketing  aircraft,  many  of  which  have  significantly  greater  financial
resources and more experience than the Company. The Company,  however,  believes
that it is competitive  because of its experience and operational  efficiency in
financing  the  transaction  types  desired by the regional air  carriers.  This
market segment,  which is  characterized  by transaction  sizes of less than $10
million and lessee  credits  that are  strong,  but  generally  unrated and more
speculative  than  that of the  major air  carriers,  is not well  served by the
Company's  larger  competitors  in the aircraft  industry.  JMC, the  management
company for the Company,  has developed a reputation as a global  participant in
this  segment of the market,  and the  Company  believes  this will  benefit the
Company. There is no assurance that the lack of significant competition from the
larger  aircraft  leasing  companies will continue or that the reputation of JMC
will continue to be strong in this market segment and benefit the Company.

Casualties,   Insurance  Coverage.  The  Company,  as  owner  of  transportation
equipment, could be held liable for injuries or damage to property caused by its
assets. Though some protection may be provided by the United States Aviation Act
with  respect  to its  aircraft  assets,  it is not  clear to what  extent  such
statutory  protection  would be  available  to the  Company and such act may not
apply to aircraft  operated in foreign  countries.  Though the Company may carry
insurance or require a lessee to insure  against a risk,  some risks of loss may
not be insurable.  An uninsured loss with respect to the Equipment or an insured
loss for which  insurance  proceeds are  inadequate,  would result in a possible
loss of invested capital in and any profits anticipated from such equipment.

Leasing  Risks.  The  Company's  successful  negotiation  of  lease  extensions,
re-leases  and sales may be critical  to its  ability to achieve  its  financial
objectives,  and will involve a number of substantial risks. Demand for lease or
purchase of the assets depends on the economic condition of the airline industry
which is in turn highly  sensitive to general  economic  conditions.  Ability to
re-lease or resell  equipment at  acceptable  rates may depend on the demand and
market values at the time of re-lease or resale.  The Company  anticipates  that
the bulk of the  equipment  it acquires  will be used  aircraft  equipment.  The
market for used aircraft is cyclical,  and generally,  but not always,  reflects
economic conditions and the strength of the travel and transportation  industry.
The demand for and resale  value of many types of older  aircraft  in the recent
past has been  depressed  by such  factors  as airline  financial  difficulties,
increased  fuel  costs,  the number of new  aircraft  on order and the number of
older  aircraft  coming off lease.  The Company's  expected  concentration  in a
limited  number of airframe and  aircraft  engine  types  (generally,  turboprop
equipment)  subjects the Company to economic  risks if those  airframe or engine
types should decline in value.  The recent  introduction  of "regional  jets" to
serve on short routes  previously  thought to be  economical  only for turboprop
aircraft  operation could decrease the demand for turboprop  aircraft,  while at
the same increasing the supply of used turboprop aircraft.  This could result in
lower lease rates and values for the Company's existing turboprop aircraft.

Risks Related to Regional Air Carriers. Because the Company has concentrated its
existing  leases and intends to  concentrate on leases to regional air carriers,
it will be subject to certain risks. First,  lessees in the regional air carrier
market include a number of companies that are start-up,  low capital, low margin
operations.  Often, the success of such carriers is dependent upon  arrangements
with major trunk  carriers,  which may be subject to termination or cancellation
by such major carrier.  This market segment is also  characterized  by low entry
costs,  and thus,  there is strong  competition  in this  industry  segment from
start-ups as well as major airlines. Thus, leasing transactions with these types
of lessees results in a generally higher lease rate on aircraft,  but may entail
higher risk of default or lessee  bankruptcy.  The  Company  will  evaluate  the
credit risk of each lessee  carefully,  and will  attempt to obtain  third party
guaranties,  letters of credit or other credit enhancements, if it deems such is
necessary.  There is no  assurance,  however,  that  such  enhancements  will be
available  or that even if obtained  will fully  protect the Company from losses
resulting  from a lessee default or bankruptcy.  Second,  a significant  area of
growth of this market is in areas outside of the United States, where collection
and enforcement are often more difficult and complicated than the United States.

Possible  Volatility of Stock Price.  The market price of the  Company's  Common
Stock could be subject to fluctuations  in response to operating  results of the
Company,  changes in general  conditions in the economy,  the financial markets,
the airline industry, changes in accounting principles or tax laws applicable to
the Company or its lessees,  or other  developments  affecting the Company,  its
customers or its  competitors,  some of which may be unrelated to the  Company's
performance.  Also, because the Company has a relatively small capitalization of
approximately 1.6 million shares,  there is a correspondingly  limited amount of
trading of the shares.  Consequently,  a single or small  number of trades could
result  in a  market  fluctuation  not  related  to any  business  or  financial
development relating to the Company.

Year 2000 Considerations. Because all administrative and management functions of
the Company are carried out by its management company,  JMC, JMC's readiness for
Year 2000 will determine the Company's  status.  JMC has reported to the Company
that it has directed its  information  technology  ("IT") manager to require any
software or hardware  purchased  for use by the  Company's  management to have a
warranty of Year 2000  compliance.  It has also directed its IT manager to study
any systems that may require Year 2000 remediation.

The IT  manager  has  determined  that,  because  JMC's IT  system is based on a
"MacOS" system,  JMC's internal  technology systems are ready for Year 2000, and
there  should  not be any  material  costs  associated  with  such  remediation.
Furthermore, the phone and internet systems have been warranted by their vendors
for Year 2000 compliance.  The Company's internal and administrative  operations
are  not  highly  dependent  on  any  other  advanced  technology  system,  and,
consequently,  management  believes  that the  Company's  exposure  to loss as a
result of Year 2000 issues in its internal and administrative  operations is not
significant.

Management  believes that the electronic systems used in the equipment leased by
the Company to lessees will not be materially affected by the Year 2000 and that
any  remediation  of the  technology  systems  embedded in the aircraft  that it
leases will not be a material  expense to the Company.  The Company has notified
all lessees of the Year 2000 problem and has requested information on the status
of each lessee's study and  remediation  plans. To date, all lessees (except for
two who have yet to respond) have reported Year 2000  compliance with respect to
the  aircraft  leased by the Company to the lessee.  The Company is following up
with those that have not responded, as well as each new additional lessee.

The Company has also been  consulting with all the  manufacturers  of its leased
equipment to confirm Year 2000 compliance, who have all indicated that they have
already notified or will shortly notify all lessee operators of their respective
Year 2000 issues.  Generally,  the type of used turboprop  aircraft owned by the
Company are not highly  dependent upon  date-sensitive  electronics,  unless the
lessee has added upgraded electronics to the aircraft.

In any event,  since the Company's  leases  generally  place all maintenance and
repair obligations on the lessees,  to the extent that the aircraft are on lease
when the Year 2000 problem is identified, it would generally be the lessee's and
not the  Company's  responsibility  to remediate  any Year 2000 problem with the
leased aircraft or additional upgraded electronics.

To the extent that a lessee has Year 2000 problems that significantly  adversely
affect its overall  financial  status,  such  material  problems  may affect the
lessee's operations and increase the risk of default by a lessee under its lease
with the Company.  The Company has also inquired with its lessees regarding Year
2000 compliance of its  administrative  and operational  activities.  It appears
responding  lessees are  generally  aware of the Year 2000 issue and have either
completed a plan or are in progress  toward  Year 2000  compliance.  There is no
assurance  that their  compliance  plans will be  successful,  however,  and the
Company is not independently  verifying any information provided by its lessees.
The Company continues to monitor its current lessees and each additional lessee.

Year 2000 issues may have a material impact on FAA operations and the operations
of certain air  carriers,  which in turn would  negatively  affect the  aircraft
industry in general.  This, of course,  may affect the business of the Company's
existing and potential lessees, and in turn, the Company.

The essential  functions of JMC and the Company are not  dependent  upon any key
third  party  vendors or  service  providers  related to the  leasing or finance
business, and consequently, the interruption of goods and services from any such
industry-specific  third party vendor or service  provider to JMC or the Company
is not likely to cause a material loss to the Company.  Of course, the Company's
ordinary  business  operation  is dependent  upon  vendors  that  provide  basic
services to  businesses  generally,  such as utility  companies,  phone and long
distance  companies,  courier  services and banking  institutions.  The Company,
through its  management  and JMC, is monitoring  the Year 2000 readiness of such
providers.  Management believes that a temporary interruption in services to the
Company by these types of service  providers  caused by Year 2000 problems would
not cause material  losses to the Company.  An extended loss of these  services,
however,   could   adversely   affect  the  Company's   business  and  financial
performance. The Company has not yet made any contingency plans for the extended
loss of these basic services.


<PAGE>



                                   SIGNATURES

In accordance  with Section 13 or 15(d) of the Exchange Act, the  Registrant has
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized on August 16, 1999.


                                                 AEROCENTURY CORP.


                                                 By:    /s/ Neal D. Crispin
                                                      ----------------------
                                                            Neal D. Crispin
                                                 Title: President


In  accordance  with the Exchange  Act, this report has been signed below by the
following persons on behalf of the Registrant and in the capacities indicated on
August 16, 1999.

         Signature                                 Title


/s/ Neal D. Crispin              Director, President and Chairman of the
-------------------------------  Board of Directors of the Registrant
Neal D. Crispin                  (Principal Executive Officer)



/s/ Toni M. Perazzo              Director, Vice President - Finance & Secretary
-------------------------------  of the Registrant (Principal Financial and
Toni M. Perazzo                  Accounting Officer)



/s/ Marc J. Anderson            Director, Chief Operating Officer, Senior Vice
------------------------------- President
Marc J. Anderson