FORM  10-QSB

                          SECURITIES AND EXCHANGE COMMISSION

                               WASHINGTON,  D. C. 20549


                    Quarterly Report Under to Section 13 or 15(d)
                        of the Securities Exchange Act of 1934

For Quarter Ended:                                December 31, 1997

Commission File Number:  1-11020

                                     Micel Corp.
       --------------------------------------------------------------------
          (Exact name of Small Business Issuer as specified in its charter)

           NEW YORK                                          11-2882297
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  (State of other jurisdiction of                        (I.R.S. Employer
   incorporation of organization)                       Identification No.)


       445 Central Ave., Cedarhurst New York               11516  
       --------------------------------------------------------------------
      (Address of Principal executive offices)           (Zip Code)

                                    (516) 569-1234
       --------------------------------------------------------------------
                 (Registrant's telephone number, including area code)

                   (Former name, former address, and former fiscal
                         year, if changed since last report)


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 such shorter period that the registrant was required
to file such reports) and (2) has been subject to such filing requirements for
past 90 days.

         YES  X                      NO  
              -                            -
Indicate the number of shares outstanding of each of the issuer's classes of
Common Stock, as of the latest practicable date.

                Common Stock,  Par Value  $.01               5,900,380
                ------------------------------------------------------
              (Title of each Class)   (Outstanding at December 31, 1997)
                                           

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                                                                               2


MICEL CORP. AND SUBSIDIARIES
CONSOLIDATED REPORT
                                           
                                  TABLE OF CONTENTS
                                           

PART I - FINANCIAL INFORMATION                                 	PAGE


Item 1. Consolidated Financial Statements (Unaudited):
       	Condensed Consolidated Balance Sheets as of
       	December 31, 1997 and September 30, 1997.             	  	3

       	Condensed Consolidated Statements of Income (loss)
       	for the three and three months ended December 31, 1997 
       	and 1996.                                                 4

       	Condensed Consolidated Statements of Cash Flows
       	for the three months ended December 31, 1997 and 1996.    5

       	Condensed Consolidated Statements of Changes in
        Shareholders' Equity.                                   		6

       	Notes to Condensed Consolidated Financial Statements   	7-8

Item 2. Management's Discussion and Analysis of Financial
       	Conditions and Results of Operations                  		9-12


PART II - OTHER  INFORMATION                                    	13

Exhibit  27 	                                                  			14

Signatures          	                                          			15


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                                                                               3

MICEL CORP. AND SUBSIDIARIES
                                           
PART I  - FINANCIAL INFORMATION
                                           


                                    MICEL CORP. AND SUBSIDIARIES
                                    -------------------------------------------

                        CONDENSED CONSOLIDATED BALANCE SHEETS

                                    DECEMBER 31	        SEPTEMBER 30
                                   	1997           		   1996
                                  	(UNAUDITED)     	    (AUDITED)
                                  	------------------- 	-------------------
          ASSETS
         ----------

CURRENT ASSETS
Cash and cash equivalents           	$ 829,282       	   $ 491,000
Accounts receivable                  830,326  	          521,332 
Inventories           	              929,375	  	         894,992
                                     ---------	      		-----------
         Total current assets        2,588,983 	        	1,907,324
                                     ---------- 	      	---------
Investment in 
Affiliated Company                  	5,295     	     		19,745
Note Receivable From
affiliated Company	                 	135,000         		100,000
Deposits With Insurance 
Companies and 
Pension Funds                      		212,125          	196,988
PLANT AND 
EQUIPMENT (net)                    	 281,061         		210,398
                                  		----------     	  	---------

         Total assets              		3,222,464	      	2,434,455
                                     =========       	=========


LIABILITIES AND SHAREHOLDERS EQUITY
------------------------------------------------------------

CURRENT LIABILITIES:
Short term bank credit              	231,173        		7621

Current maturities of long 
term debt        		                 	17,598		        	18,416

Accounts payable and 
accrued liabilities                		948,004        		933,188

Advances from customers             	242,057        		323,838
                                				----------	    	-----------
Total current liabilities             1,438,832	    	1,283,063
                                  		 -------       	 	-------

LONG TERM DEBT:
net of current maturities	          19,385	         		23,312

ACCRUED SEVERANCE 
PAY                               		261,655	         	251,062

Minority Interest	                  38,683	          	0
                             	    		-------       			-------
           Total liabilities        1,758,555      		1,557,437
                                 	  --------       		----------

SHAREHOLDERS' EQUITY:
Common Stock                       	59,004	        		57,504
Additional Paid in Capital          6,831,860        6,533,386
Capital Reserve                     432,981           - 	      
Accumulated deficit                	(5,859,936)	    	(5,713,872)	
                     	              ----------- 	   	-----------
       Total shareholders' equity   1,463,909       	877,018
                                  	 ----------      	--------
       Total liabilities and 
       shareholders' equity	        3,222,464      		2,434,455
                                    	=========      	=========

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                                                                              4




                             MICEL CORP. AND SUBSIDIARIES
                  CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)

                   		3 Months Ended December 31
	            	-----------------------------------	

                    			1997	      	  1996
                      (Unaudited)    (Unaudited)
             	       	-----------    	-----------	


Sales         		746,889        	1,815,182
Cost Of  Sales		423,161        	1,488,438
              		---------   	   ---------


Gross Profit 			323,728        	326,744
			             ----------      ----------

Research and Development
Expenses (net) 		208,434	       126,701

Marketing and Selling		
Expenses (net) 		55,237	       	48,850

General and Administrative
Expenses       		223,153       	104,061
                		-------      	-------


    Total operating 
    expenses     486,824	        279,612     
              			----------	     ---------

    Income (loss) From 
    Operations  (163,096)	       47,132

Interest and 
Other Income	   12,978	         	1,685	    

Interest and 
Other Expense  	(9,832)	       	(35,141)

Minority Interest 
in Losses of 
Subsidiaries  	 	28,336

Equity in Loss 
of Affiliates	   (14,450)	      (4,686)
               		-------     	  ---------
 
Net Loss         (146,064)     	(8,990)    	   
       	         ======        	======


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                                                                              5







                             MICEL CORP. AND SUBSIDIARIES
                   CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

                                            	  	3 MONTHS  ENDED  DECEMBER 31
	                                              --------------------------------
              		                             1997           1996
                      			                    (Unaudited)   	(Unaudited)
Cash Flows From Operating Activities:
Net income (loss)                           		(146,064)      	8,990

Adjustments to reconcile net income (loss)	
to net cash used in operating activities:	
 Depreciation & amortization                  24,828        	21,774
 Minority interest in losses of subsidiaries	 (28,336)
 Income from affiliated company               14,450	
 Changes in operating assets and liabilities:
   Accounts receivable                       (308,994)	      (194,525)
   Inventories                               (34,383)	       (63,863)
  Accounts payable and accrued liabilities   14,816		        263,889  
  Advances from customers                   	(81,781)       	(57,693)   	     
  Accrued severance pay                 	   	(4,544)        	10,941
	                                         	---------        	-------- 

Net cash provided by
operating activities		                       (550,008)      	(10,487)
                                             -------        	---------

CASH FLOWS From Investing Activities:                 
  Purchase of equipment                     	(95,489)	       (31,347)   
 Investment in affiliated company            (35,000)
                                             --------        	---------
 Net cash used in investing activities		     (130,489)	      (31,347)          


CASH FLOWS From Financing Activities:

Repayment of long term debt                 	(4,745)       		(40,312)
Credit                                       223,552	        57,409  
Issuance of common stock      	             	799,972	        400,000
                                             ---------      	--------
  Net cash provided by financing activities  1,018,779	      417,097

  Increase (decrease) In Cash and Cash 
  Equivalents                               	338,282	        375,263

CASH AND CASH EQUIVALENTS, Beginning 
of Period                                   	491,000        	81,089
                                             --------      	---------

CASH AND CASH EQUIVALENTS, end 
of period                                  		829,282         456,352
                                           	=======          =======
Supplemental Cash Flow Information:
Interest Paid:                             		6,134	          22,791   	



<PAGE>
                                                                            6

MICEL CORPORATION AND SUBSIDIARIES CONSOLIDATED 
STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY 

FOR THE THREE MONTHS ENDED DECEMBER 31, 1997

                                           Additional paid 
                                           in Capital &
                  		Common Stock         	 Capital         Accumulated  Total 
                  		No. of Shares 	Value  	Reserves        Deficit 
                    ------------  	-----  	-------------   -----------  -----
Balance, 
September 30, 1997 	5,750,380      	57,504	   6,533,386	  (5,713,872)	 877,018

Issuance of Common Stock
(Net of issuance expenses)
in a private 
placement	          150,000	        1500	     298,474	    -		          299,974

Capital Reserves Resulting from 
issuance of subsidiary shares to a 
third party	                                  432,981     -            432,981

Net Loss                                                  (146,064)    (146,064)
                  	-------        	-----   	-----------  	----------   ------ 
Balance, December 
31, 1997         		5,900,380       59,004   7,264,841    (5,859,936)   1,463,909

 



                   MICEL CORP. AND SUBSIDIARIES 
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL
                      STATEMENTS (UNAUDITED)

1.   CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
     The condensed consolidated balance sheet at December 31, 1997, the
     consolidated statements of Income (loss) for the three months ended 
     December 31, 1997 and 1996, and the consolidated statements of cash flows
     for the three months ended December 31, 1997 and 1996, have been prepared 
     by the Company, and are unaudited.

     Reference should be made to the notes to the Company's September 30,
     1997 consolidated financial statements for additional details of the
     company's consolidated financial condition, results of operations and
     cash flows. The details in those notes have not changed except as a
     result of normal transactions in the interim. All adjustments (of
     normal recurring nature) which are, in the opinion of management,
     necessary to a fair presentation of the results of the interim period
     have been included.

     The results of operations for the period ended December 31, 1997, are
     not necessarily indicative of the operating results for the full year.

2.   Common Stock
     During the first quarter of 1998, the company raised
     $300,000 in a private placement of Common Stock at $2.00 per share or
     150,000 shares.  

3.   RadioTel
     RadioTel, Ltd., was established to develop and manufacture point to
     point and point to multipoint wireless radio links for various
     applications. RadioTel expects to supply the full spectrum of
     frequencies up to 38 GHz with data rates from E1 to 16 E1 including
     ATM. RadioTel will attempt to address the market  with unique low
     cost and innovative solutions to wire-line services. The radio module
     which it hopes to develop is expected to be suitable for digital
     wireless systems, mainly for telecommunication applications such as
     rural telephones and wireless local loop ("WLL") systems in remote
     locations (simplified wireless telephone systems for remote
     subscribers utilizing radio frequencies for connection into the
     public telephone network).

     The financial statements of RadioTel are consolidated into the Company's 
     financial statements.

<PAGE>
                                                                              8
     During the quaretr the company signed an investment agreement according 
     to which the investor is to invest $1,000,000 in consideration for 16%
     of RadioTel shares. 
     Through December 31, 1997, the investor invested $500,000 out of the 
     $1,000,000, causing Micel's share in RadioTel to be diluted to 91%.
     As a result, Micel had a capital reserve of $432,981.
   

4.   MICEL Wireless Corp.

     MICEL Wireless Corp. (formerly Milink), a Florida corporation and a joint
     venture  between the Company and Export Business & Services, Inc.
     ("EBS"), is an international telecommunications company engaged in the
     sourcing, marketing and sales of wireless telephone terminals and
     other related products. MICEL Wireless currently represents certain
     manufacturing companies and telecom agencies as a purchasing agent and
     sales representative.

     MICEL Wireless Corp. designs, manufactures, and sells fixed cellular
     terminals for WLL applications in developing countries. The Company
     capitalizes on the technical capabilities of  RadioTel, the existing
     knowledge of the cellular and wireless local loop markets and a
     network of distribution channels. Micel Wireless' initial focus has
     been in Latin America, where Micel Wireless expects to take immediate
     advantage of existing WLL opportunities. 

     The Company owns 50% of MICEL Wireless. Refer to the Company's Form
     10-KSB for the period ended September 30, 1997 for additional details.
     The Company is committed to provide to Micel Wireless a working capital 
     loan in the amount of $150,000. As of December 31, 1997 the outstanding 
     loan to Micel Wireless is $135,000. The working capital loan shall bear 
     interest at 12% per annum, payable annually.  The loan will become due 
     after 12 months from the date of the loan or when otherwise mutually agreed
     upon by the Company and EBS. At a time and terms to be mutually agreed 
     upon among the Company, EBS and MICEL Wireless, the working capital loan 
     may be converted into nonvoting preferred stock of MICEL Wireless.

     Micel Wireless commenced activities in the first quarter of Fiscal
     1997, in which the Company lent Micel Wireless $100,000. The Company 
     applies the equity method of accounting for its investments in Micel
     Wireless.

     
5.   Legal Proceedings
     
     In July 1994, the Company  commenced a civil action in Israel in the
     approximate amount of $3,000,000 against M/A Com and Hillel Weinstein
     for false representations made by M/A Com and Dr. Weinstein in
     connection with the purchase of MicroKim Ltd. from M/A Com and for
     subsequent damages resulting from such misrepresentations.  Dr.
     Weinstein is no longer a defendant or counter claimant in this action
     as a result of an agreement reached on May 27, 1996. 
     On March 30, 1997, the judge granted M/A Com's motion for the 
     cncellation of the company's request for "out of boundries" jurisdiction. 
     On July 23, 1997, the company resubmitted the request and it was granted.
     In November 1997, the complaint and accompanying papers were again served 
     on M/A Com.


<PAGE>

6.   Recently Issued Accounting Standards

     In February 1997, the Financial Accounting Standards Board issued 
     Statement of Financial Accounting Standards (SFAS) No. 128, Earning 
     Per Share. This Statement establishes standards for computing and 
     presenting earning per share (EPS), replacing the presentation of 
     currently required primary EPS with a presentation of Basic EPS. For
     entities with complex capital structures, the statement requires the
     dual presentation of both Basic EPS and Diluted EPS on the face of the 
     statement of operations. Under this new standard, Basic EPS is computed 
     based on weighted average shares outstanding and excludes any potential
     dilution; Diluted EPS reflects potential dilution from the exercise or 
     conversion of securities into common stock or from other contracts to issue
     common stock and is similar to the currently required fully diluted EPS,
     SFAS 128 is effective for financial statements issued for periods ending 
     after December 15, 1997,including interim periods, and earlier application
     is not permitted. When adopted, the Company will be required to restate its
     EPS data for all prior periods presented. The Company does not expect the 
     impact of the adoption of this statement to be material to previously 
     reported EPS amounts.                                                     

  
ITEM 2



                       MANAGEMENT'S DISCUSSION AND ANALYSIS OF 
                    FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS

General

Impact of inflation, devaluation and fluctuation of currencies on the results
operations.
     
The Company's operations are conducted through its Israeli subsidiaries,
MicroKim and RadioTel. A substantial portion of sales and purchases of materials
are in, or linked to the United States dollar. Most of other expenses are linked
to the Israeli Shekel. Transactions and balances originally denominated in
dollars are presented at their original amounts.

Transactions and balances in currencies other than the dollar are translated
into dollars in accordance with the principles set forth in statement No. 52 of
the Financial Accounting Standards Board.

Fluctuations in the rate of exchange between the dollar and such other
currencies result in the recognition of financial income or loss. The Company
manages its Israeli operations with the object of protecting against material
net financial loss in U.S. dollar terms from the impact of Israeli inflation and
currency devaluation on its non - U.S. dollar assets and liabilities. In the
three month period ended Dec 31, 1997, the Israeli Consumer Price Index
("ICPI") increased by 0.59% , as compared with a devaluation of the Shekel of
1.12% against the U.S dollar. To the extent the rate of devaluation of the
shekel with respect to the U.S. dollar does not substantially offset the change
in the rate of inflation in Israel, the expenses in, or linked to, the shekel
will be impacted when translated to the U.S. dollar. There can be no assurance 
that the Government of Israel will devalue the shekel from time to time to
offset the effects of inflation in Israel.

Due to the weakness of the defense market, the company intends to place 
emphasis on increasing its commercial line of products and commercial market 
base. It is the policy of the Company to accept only those orders which are
worthwhile economically and the Company has also tended to accept mainly larger 
orders for a limited number of projects, the most important of which tend to be 
with strategic partners as with the projects with ASDI and ArrayCom. A 
significant portion of the future revenues of the company will be dependent on
the success of these two projects.

<PAGE>

                                                                             10





FINANCIAL CONDITION:

In the first three months of Fiscal 1998 the company issued 150,000 shares of 
common stock in a private placement at $2.00 per share.

The company's operations in the first three months of  the fiscal year ending on
September 30, 1998 ('Fiscal 1998') have been financed principally from revenues
from sales, research and development grants and by a private placement of shares
of common stock.

The total amount of outstanding loans, credit facilities and guarantees from
banks are approximately $614,800 and is secured by liens on certain of 
MicroKim's property and equipment, share capital and insurance rights, and by a
secured interest in all of MicroKim's assets. This amount includes approximately
$36,983 of long term borrowings from Israel Industrial Development Bank Ltd.,
to be repaid between 1997 and 2000. This also includes approximately $396,000
of performance guarantees pursuant to contracts with customers. 

In the three months ended December 31, 1997 net cash equivalents increased by
$338,282 as a result of $799,974 proceeds from issuance of common stock and 
$223,552 from bank overdraft facilities, offset by the repayment of long
term liabilities of $4745, purchases of fixed assets of $95,489, a loan to an 
affiliated company of $35,000 and in operating activities $550,010.


<PAGE>

The company is committed to fund RadioTel in the amount of $ 935,000
through October 30, 1998. In the event that additional funding is not provided 
to RadioTel, Micel's ownership in RadioTel may be diluted.              

                                                                             11



RESULTS OF OPERATIONS

Three months ended December 31, 1997 compared to the three months ended 
December 31, 1996.

Sales in the three months ended December 31 , 1997 were $746,889 as compared
with $1,815,182 in the three months ended December 31, 1996. The sales of the 
first quarter of fiscal 1997 included the completion of a certain project, sales
of which were $1,189,000. Cost of sales in the three months ended December 31, 
1997 was 56.66% of sales or $423,161 as compared with 82% or $1,488,438 in the 
same period in 1996.
The sales in the first quarter of Fiscal 1998 are not indicative of sales
for the whole year.

Research and development expenses (net) increased to $208,434 or 28% of sales
in the three months ended Dec 31, 1997 from $126,701 or 16.96% of sales in the
same period in 1996. The increase was caused by new research and development
activities.

Selling expenses in the three months ended December 31, 1997 were $55,237 or
7.4% of sales compared to $48,850 or 2.69% of sales in the same period in 
1996.

General and administrative expenses increased to $223,153 or 29.9% of sales in
the three months ended December 31, 1997 from $104,061 or 5.7% of sales in the
same period in 1996. The increase was mainly due to the operations of RadioTel.

Financial expenses in the three months ended December 31, 1997 were $9,832 or
1.3% of sales compared with $35,141 or 1.9% of sales in the same period in
1996.

Minority share in RadioTel losses amounted to $28,336 (see also paragraph
3 above).

Company's share in losses of its 50% held affiliate, Micel Wireless, were 
$14,450 compared with $4,686 in the first quarter of 1996.

In the three months ended December 31, 1997, the company reported a loss of
$146,066 In the same period in 1996, the Company incurred a loss of $38,142.
The loss is attributable mainly to the operation of RadioTel.

The inventories at December 31, 1997, were comprised of $498,083 raw materials
and $431,292 work in process as compared to $500,741 raw materials and $272,047
work in process at December 31, 1996.

The company is committed to pay royalties to the office of the Chief Scientist
of the State of Israel ("OCS") in respect to products under development for
which the OCS participated by way of grant. The royalty is computed at the rate
of 2%-3% of proceeds from sales of such products up to the amount of such grant.

<PAGE>

                                                                             12


                             MICEL CORP. AND SUBSIDIARIES

                             PART II - OTHER INFORMATION



Item 1.   Legal Proceeding
          Reference is made to Form 10-KSB for the year ended
          September 30, 1997.

Item 2.   Changes in Securities
          None.

Item 3.   Default on Senior Securities
          None.

Item 4.   Submission of Matters to a Vote of Security Holders
          None.

Item 5.   Other Information
          None.

Item 6.   Exhibits and Reports on Form 8-K
          Exhibit 27


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                                                                             14


MICEL CORP. AND SUBSIDIARIES


Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has caused this report to be signed on behalf by the undersigned
hereunto duly authorized.



                                   MICEL CORP.

                                   Registrant



Date: February 19th, 1998          By:  /s/ Ron Levy
                                      -------------------------------
                                        President and
                                        Chief Executive and Financial Officer