SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                    FORM 10-Q

(Mark One)

 X      Quarterly  report  pursuant  to  Section  13  or 15(d) of the Securities
----    Exchange Act of 1934


For the quarterly period ended December 31, 1996

----    Transition  report  pursuant  to Section 13 or 15(d) of  the  Securities
        Exchange Act of 1934

For the transition period from ____________________ to ____________________



                         Commission File Number 0-19266

                        ALLIED HEALTHCARE PRODUCTS, INC.

                              1720 Sublette Avenue

                            St. Louis, Missouri 63110
                                  314/771-2400

                        I.R.S. Employment I.D. 25-1370721

        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  twelve  months (or for such shorter  periods that the
registrant  was required to file such reports,  and (2) has been subject to such
filing requirements for the past ninety days.

                             Yes       X               No
                                 _____________            _____________
        The number of shares of common stock outstanding at February 14, 1997 is
7,796,682 shares.


<PAGE>


                                      INDEX


                                                                           Page
                                                                          Number
Part I - Financial Information

           Item 1.  Financial Statements

                    Consolidated Statement
                    of Operations - three months and six months                3
                    ended December 31,
                    1996 and 1995 (Unaudited)

                    Consolidated  Balance Sheets -
                    December 31, 1996 (Unaudited) and                     4 - 5
                    June 30, 1996

                    Consolidated Statements of Cash
                    Flow - six months ended                               6 - 7
                    December 31, 1996 and 1995 (Unaudited)

                    Consolidated Statement of Changes
                    in Stockholders' Equity for six months                  8
                    ended December 31, 1996 (Unaudited)

                    Notes to Consolidated
                    Financial Statements                                  9 - 10

           Item 2.  Management's Discussion and
                    Analysis of Financial Condition                      11 - 18
                    and Results of Operations

Part II - Other Information                                                19



Signature                                                                  20


<PAGE>
                        ALLIED HEALTHCARE PRODUCTS, INC.
                      CONSOLIDATED STATEMENT OF OPERATIONS
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                   Three months ended            Six months ended
                                      December 31,                 December 31,
                              --------------------------   ----------------------------
                                   1996          1995           1996           1995
                              ------------  ------------   -------------  -------------
<S>                            <C>           <C>             <C>            <C>
Net sales                      $28,388,652   $28,438,914     $57,522,375    $59,627,946
Cost of sales                   19,663,935    18,549,738      39,557,557     37,400,762
                              ------------  ------------   -------------  -------------
Gross profit                     8,724,717     9,889,176      17,964,818     22,227,184

Selling, general and
  administrative expenses        8,233,434     7,184,626      16,611,268     14,823,471
                              ------------  ------------   -------------  -------------

Income from operations             491,283     2,704,550       1,353,550      7,403,713

Other expenses:
  Interest expense               1,408,745       984,919       2,524,175      2,358,801
  Other, net                        28,980        32,661          54,936         32,639
                              ------------  ------------   -------------  -------------
                                 1,437,725     1,017,580       2,579,111      2,391,440
                              ------------  ------------   -------------  -------------
Income/(loss) before
  provision/(benefit) for
  income taxes                    (946,442)    1,686,970      (1,225,561)     5,012,273

Provision/(benefit) for
  income taxes                    (390,000)      675,261        (491,850)     2,004,752
                              ------------  ------------   -------------  -------------

Net income/(loss)                ($556,442)   $1,011,709       ($733,711)    $3,007,521
                              ============  ============   =============  =============

Earnings/(loss) per share           ($0.07)        $0.11          ($0.09)         $0.43
                              ============  ============   =============  =============

Weighted average shares          7,796,682     7,744,095       7,796,682      6,964,825
                              ============  ============   =============  =============
</TABLE>

          See Accompanying Notes to Consolidated Financial Statements.

<PAGE>

                        ALLIED HEALTHCARE PRODUCTS, INC.
                           CONSOLIDATED BALANCE SHEET

                                     ASSETS

<TABLE>
<CAPTION>
                                                          December 31,     June 30,
                                                              1996           1996
                                                          ------------   ------------
                                                           (Unaudited)
<S>                                                         <C>           <C>
Current Assets:
   Cash                                                     $1,406,212    $1,489,133
   Accounts receivable, net of allowance for doubtful
      accounts of $411,987 and $422,517, respectively       26,507,962    25,964,658
   Inventories                                              28,040,052    28,046,490
   Income taxes receivable                                   1,017,433     2,285,224
   Other current assets                                      3,365,865     2,713,497
                                                          ------------   ------------
      Total current assets                                  60,337,524    60,499,002
                                                          ------------   ------------
   Property, plant and equipment, net                       21,656,763    21,968,504
   Goodwill, net                                            52,070,949     52,821,411
   Other assets, net                                         1,723,027      1,471,541
                                                          ------------   ------------
      Total assets                                        $135,788,263   $136,760,458
                                                          ============   ============

</TABLE>

          See Accompanying Notes To Consolidated Financial Statements.


<PAGE>


                        ALLIED HEALTHCARE PRODUCTS, INC.
                           CONSOLIDATED BALANCE SHEET
                                  (CONTINUED)

                      LIABILITIES AND STOCKHOLDERS' EQUITY

<TABLE>
<CAPTION>
                                                        December 31,    June 30,
                                                            1996           1996
                                                        ------------   ------------
                                                         (Unaudited)
<S>                                                     <C>            <C>
Current liabilities:
   Accounts payable                                      $12,219,539    $13,104,299
   Current portion of long-term debt                       3,863,644      3,848,780
   Other current liabilities                               5,113,191      5,516,045
                                                        ------------   ------------
      Total current liabilities                           21,196,374     22,469,124
                                                        ------------   ------------
Long-term debt                                            50,067,811     49,033,545

Deferred income tax liability-noncurrent                   1,371,649      1,371,649

Commitments and contingencies

Stockholders' equity:
   Preferred stock; $.01 par value; 1,500,000 shares
    authorized; no shares issued and outstanding
   Series A preferred stock; $.01 par value; 200,000
    shares authorized; no shares issued and outstanding
   Common stock; $.01 par value; 30,000,000 shares
    authorized; 7,796,682 and 7,796,682 shares
    issued and outstanding at December 31, 1996
    and June 30, 1996, respectively                          101,002        101,002
   Additional paid-in capital                             46,945,971     46,945,971
   Common stock in treasury, at cost                     (20,731,428)   (20,731,428)
   Retained earnings                                      36,836,884     37,570,595
                                                        ------------   ------------
                                                          63,152,429     63,886,140
      Total stockholders' equity                        ------------   ------------
                                                        $135,788,263   $136,760,458
      Total liabilities and stockholders' equity        ============   ============


          See Accompanying Notes To Consolidated Financial Statements.
</TABLE>

<PAGE>

                        ALLIED HEALTHCARE PRODUCTS, INC.
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                                  (UNAUDITED)
<TABLE>
<CAPTION>
                                                                 Six Months ended
                                                                   December 31,
                                                           -----------------------------
                                                                1996            1995
                                                           -------------   -------------
<S>                                                        <C>             <C>
Cash flows from operating activities:
   Net income (loss)                                          ($733,711)     $3,007,521
   Adjustments to reconcile net income to
       net cash provided by (used in)
       operating activities:
      Depreciation and amortization                           2,662,639       1,926,034
      Decrease (increase) in accounts receivable, net          (543,304)      1,484,356
      Decrease (increase) in inventories                          6,438      (7,629,945)
      Decrease in income taxes receivable                     1,267,791               0
      Increase in other current assets                         (652,368)       (299,350)
      Increase (decrease) in accounts pay                      (884,760)      2,074,694
      Decrease in accrued income taxes                                0        (350,318)
      Decrease in other current liabilities                     142,914      (2,778,477)
                                                           -------------   -------------
       Net cash provided by (used in) operating activities    1,265,639      (2,565,485)
                                                           -------------   -------------

Cash flows from investing activities:
   Capital expenditures                                      (1,300,761)     (1,571,527)
   Acquisition of Omni-Tech                                           0      (1,556,336)
                                                           -------------   -------------
       Net cash used in investing activities                 (1,300,761)     (3,127,863)
                                                           -------------   -------------
</TABLE>



                                  (CONTINUED)


<PAGE>


                        ALLIED HEALTHCARE PRODUCTS, INC.
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                                  (CONTINUED)
<TABLE>
<CAPTION>
                                                                 Six Months ended
                                                                   December 31,                 
                                                           -----------------------------
                                                               1996            1995
                                                           -------------   -------------
<S>                                                        <C>             <C>
Cash flows from financing activities:
   Proceeds from issuance of long-term debt                   5,000,000      42,000,000
   Payments of long-term debt                                  (839,791)    (60,835,912)
   Borrowings under revolving credit agreement               12,609,715      17,304,800
   Payments under revolving credit agreement                (15,720,794)    (15,204,800)
   Issuance of common stock                                           0      25,696,230
   Debt issuance costs                                         (551,161)     (1,063,048)
   Dividends paid on common stock                              (545,768)       (866,047)
                                                           -------------   -------------
       Net cash provided by (used in) financing activities      (47,799)      7,031,223
                                                           -------------   -------------

   Net increase (decrease) in cash and equivalents              (82,921)      1,337,875
   Cash and equivalents at beginning of period                1,489,133         174,952
                                                           -------------   -------------
   Cash and equivalents at end of period                     $1,406,212      $1,512,827
                                                           =============   =============
</TABLE>

          See Accompanying Notes To Consolidated Financial Statements.

<PAGE>

                        ALLIED HEALTHCARE PRODUCTS, INC.
                      CONSOLIDATED STATEMENT OF CHANGES IN
                              STOCKHOLDERS' EQUITY
                                  (UNAUDITED)


<TABLE>
<CAPTION>
                                                  Additional
                           Preferred    Common     paid-in      Treasury      Retained
                             stock      stock      capital        stock       earnings
                           ---------- ---------- ------------ ------------- ------------
<S>                        <C>        <C>        <C>          <C>           <C>
Balance, June 30, 1996            $0   $101,002  $46,945,971  ($20,731,428) $37,570,595

Net income for the
   Six Months ended
   December 31, 1996                                                           (733,711)
                           ---------- ---------- ------------ ------------- ------------
Balance,
December 31, 1996                 $0   $101,002  $46,945,971  ($20,731,428) $36,836,884
                           ========== ========== ============ ============= ============
</TABLE>

<PAGE>



                        ALLIED HEALTHCARE PRODUCTS, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)




1.      Unaudited Financial Statements

               The  accompanying   unaudited  financial   statements  have  been
prepared in accordance  with the  instructions  for Form 10-Q and do not include
all of the information and footnotes required by generally  accepted  accounting
principles for complete financial statements. In the opinion of management,  all
adjustments,   consisting  only  of  normal  recurring  adjustments   considered
necessary for a fair presentation, have been included. Operating results for any
quarter are not  necessarily  indicative of the results for any other quarter or
for the full  year.  These  statements  should be read in  conjunction  with the
financial statements and notes to the consolidated  financial statements thereto
included in the Company's Form 10-K for the year ended June 30, 1996.

2.      Inventories

               Inventories are comprised as follows:

                                            December 31,            June 30,
                                               1996                   1996
                                            (Unaudited)

               Raw Material                 $   214,865           $   179,042
               Work-in-progress               2,510,401             2,563,773
               Component Parts               16,848,184            18,428,851
               Finished Goods                 8,466,602             6,874,824
                                            -----------           -----------
                                            $28,040,052           $28,046,490
                                            ===========           ===========


The above  amounts are net of a reserve for  obsolete  and excess  inventory  of
approximately  $1.7  million and $1.8  million at December 31, 1996 and June 30,
1996, respectively.


<PAGE>


3.      Debt Amendment

               On September  20, 1996 the Company  amended its  existing  $125.0
million  credit  facilities  with its  commercial  bank  syndicate.  The  credit
facilities  were amended such that the $68.4 million unused portion of the $70.0
million  acquisition term loan facility is no longer available and the remaining
credit facilities' maturity dates were reset to July 31, 1998. In addition,  the
amendments  were made to reset  certain  covenants  and to increase  the advance
rates on the revolving credit facility  borrowing base.  Further,  in connection
with the amended credit  facilities,  the Company  entered into an addition $5.0
million term loan,  also maturing July 31, 1998. The amended  credit  facilities
provides the Company with credit facilities  totaling $60.0 million which can be
utilized to finance  operations  and future  growth.  At December 31, 1996,  the
Company had total borrowings of $49.6 million on these credit facilities and was
in  compliance  with all  covenants or had received  waivers of all covenants in
which it was not in  compliance.  In  connection  with the  receipt of  covenant
waivers,  the  Company  agreed to pay its  commercial  bank  syndicate  a fee of
$450,000, plus $85,000 per month. In addition, the Company agreed that if it did
not reduce its aggregate  borrowings  with the commercial  bank syndicate by $20
million by May 15, 1997 or otherwise  obtain a commitment  which would result in
proceeds to the Company of at least $20  million by May 15,  1997,  it would pay
the  commercial  bank  syndicate an additional  fee of $450,000 on May 15, 1997.
Finally, the Company and the agent for the commercial bank syndicate have agreed
to negotiate mutually  satisfactory  revisions to the covenants contained in the
credit facilities by May 1, 1997.

        The  notes  payable  and  the   revolving   credit   agreement   contain
restrictions on the pledging of assets and various covenants regarding financial
ratios and are secured by property, plant and equipment, accounts receivable and
inventory.


<PAGE>


Item 2.        Management's  Discussion and Analysis  of Financial Condition and
               Results of Operations.
GENERAL

The  following  discussion  summarizes  the  significant  factors  affecting the
consolidated  operating  results and  financial  condition of Allied  Healthcare
Products,  Inc.  ("Allied" or the  "Company")  for the three month and six month
periods  ended  December  31,  1996  compared  to the three  month and six month
periods ended December 31, 1995. This  discussion  should be read in conjunction
with the December 31, 1996  consolidated  financial  statements and accompanying
notes  thereto  included in this  Quarterly  Report on Form 10-Q for the quarter
ended December 31, 1996.

Certain  statements  contained  herein are  forward-looking  statements.  Actual
results could differ  materially  from those  anticipated as a result of various
factors, including cyclical and other industry downturns, the effects of federal
and state  legislation  on health care reform,  including  Medicare and Medicaid
financing,  the inability to achieve cost reductions through  rationalization of
acquired  companies or to increase prices of certain  products,  difficulties or
delays in the  introduction  of new products or  disruptions  in  manufacturing,
selling and/or shipping efforts.

Since  December 1993, the Company has completed  seven  acquisitions  which have
significantly expanded its product lines. These acquisitions were each accounted
for under the purchase method of accounting and were financed  primarily through
bank  borrowings,  resulting  in a large  increase  in the  Company's  debt  and
interest expense. One acquisition was partially financed through the issuance of
common stock.  Results of operations of each acquired Company have been included
in Allied's  consolidated  statement of operations from the date of acquisition.
The purchase price of each  acquisition was allocated to the assets acquired and
liabilities  assumed,  based  on  their  estimated  fair  value  at the  date of
acquisition.  The excess of purchase  price over the estimated fair value of net
assets  acquired  was, in each  instance,  recorded as goodwill and is amortized
over 20- or 40-year periods from the date of acquisition.  Primarily as a result
of these  acquisitions,  the Company  will incur  approximately  $1.5 million in
annual goodwill  amortization  expense. The following table summarizes the seven
acquisitions:

<TABLE>
<CAPTION>

DATE                  BUSINESS                                   PRODUCTS                             PURCHASE PRICE
                                                                                                   (DOLLARS IN MILLIONS)
<S>                   <C>                                        <C>                                <C>

________________________________________________________________________________________________________________________

December 1993         Life Support Products, Inc. ("LSP")        Emergency medical equipment . . . . . . . . . . . . . $15.7
March 1994            Hospital Systems, Inc. ("HSI")             Headwall products . . . . . . . . . . . . . . . . . .   2.2
September 1994        B&F Medical Products, Inc. ("B&F")         Home health care and respiratory therapy products . .  21.5
February 1995         Bear Medical Systems, Inc. ("Bear")        Critical care ventilators . . . . . . . . . . . . . .  15.4
May 1995              BiCore Monitoring Systems, Inc. ("BiCore") Monitoring systems and equipment for ventilators  . .   4.7
June 1995             Design Principles, Inc. ("DPI")            Emergency medical equipment . . . . . . . . . . . . .   0.6
November 1995         Omni-Tech Medical, Inc. ("Omni-Tech")      Transport ventilators . . . . . . . . . . . . . . . .   1.6

</TABLE>

These seven  acquisitions have  strategically  placed the Company in the growing
areas of home health care and  extended  care  markets,  expanded the breadth of
products  offered and are expected to provide a source of future growth in sales
and earnings.  The Company believes that the expansion of product line offerings
is particularly  important in international  markets as the Company continues to
increase its  worldwide  sales force in an effort to be  positioned to reach the
growth  potential of these  emerging  international  markets.  While the Company
continues to believe that these acquisitions will have positive implications for
the future, the integration and  rationalization of the acquired  businesses are
still in progress.  Accordingly,  the Company  continued  to undertake  numerous
activities towards the  implementation of these integration and  rationalization
objectives during the second quarter of fiscal


<PAGE>


1997.  Included in these  activities  are field sales  force  consolidation  and
training,  information system  enhancements,  and capital expenditure  projects.
Progress  made by the  Company  during the second  quarter of fiscal  1997 is as
follows:

FIELD SALES FORCE CONSOLIDATION AND TRAINING

In the first  quarter of fiscal 1997,  the Company  consolidated  its 21 patient
care  specialists  with its 21  ventilator  specialists  to  create a 34  person
respiratory  products  specialists  field sales force. The training required for
this  consolidation  was completed in September 1996 for half of the field sales
force and was  completed in November  1996 for the  remaining  half of the field
sales force.  Benefits expected from this consolidation  include optimization of
selling expenses through increased sales coverage,  broadening product offerings
for each sales call,  significantly reducing the geographic territory each sales
specialist  must cover,  and  leveraging  the  strength  of these  complementary
product   lines  while   enabling  the  sales   specialists   to  enhance  their
relationships with customers.

INFORMATION SYSTEMS ENHANCEMENTS

In October 1996 the Company  converted its  Corporate  Offices and its St. Louis
manufacturing  operations  to a  new  fully  integrated  software  system.  This
computer  conversion,  which should provide a strategic long-term benefit to the
Company,   caused  short-term  disruptions  in  manufacturing  and  shipping  of
products.  The  Company  was unable to meet the  challenges  of this  disruption
during the fiscal 1997 second quarter,  and  accordingly  ended the quarter with
past due  shipments.  These past due shipments are expected to be shipped in the
third quarter of fiscal 1997.  The Company has continued to make advances in the
computer  conversion process but has not yet fully completed these activities in
St.  Louis.  The Company also plans to convert its Toledo,  Ohio and  Riverside,
California operations.  Preliminary work has begun in these other operations but
the  conversion  at these  locations  will take place  only after the St.  Louis
systems are process proven. When fully implemented,  the information  technology
systems  enhancement should enable the Company to realize potential synergies of
acquisitions  through an efficient  integrated  data base,  enhanced  management
reporting systems and through consolidation of certain operational functions.

CAPITAL EXPENDITURE PROJECTS

The  Company  made  significant  progress  in  modernizing  two of  its  primary
manufacturing  facilities during the fiscal 1997 second quarter. In May and June
of 1996, the Company purchased five computer  controlled  machining centers and,
in the second quarter of fiscal 1997 substantially completed the programming and
installation  process for this  machinery in its St. Louis,  Missouri  facility.
This $1.5 million  investment  will  modernize  the  Company's  metal  machining
capabilities  and has  begun to  provide  significant  opportunities  to  reduce
product costs from shorter set-up times,  elimination of secondary operations in
component  manufacturing,  and in the future should provide the  opportunity for
reduced inventory levels, reductions in scrap and improvements in quality.

In  addition,  the Company is in the process of  investing up to $2.0 million in
molds and injection molding machinery to expand the production capacity and gain
efficiencies  at its Toledo,  Ohio facility.  Manufacturing  inefficiencies  and
capacity  constraints  caused by old,  outdated  injection  mold  machinery  has
prevented the Company from shipping to the level of demand for certain products.
This investment in enhanced  injection  molding  capabilities is expected,  when
complete,  to increase annual  disposable  product  production up to 20%, and to
provide  significant  cost reduction  opportunities,  including  reduced


<PAGE>


product  material  content,  labor and utility costs,  while  improving  overall
quality.  Six injection  molding machines and three molds have been installed as
of December 31, 1996. An additional 14 molds are scheduled for delivery  through
April  1997 while  plans to order  four  additional  molding  machines  and four
additional molds are under evaluation.  The installation of equipment  delivered
to date has been in accordance with management's expectations.

While the  Company has  expended  both  monetary  and human  resources  on these
projects  in  the  second  quarter  of  fiscal  1997  and  intends  to  continue
emphasizing  these and other  internally  controlled  projects,  there can be no
assurance that the Company will be successful in implementing these projects and
realizing these potential synergies.

FINANCIAL INFORMATION:

The following table sets forth, for the fiscal period indicated,  the percentage
of  net  sales   represented  by  certain  items   reflected  in  the  Company's
consolidated statement of operations.

                                      Three Months Ended        Six Months Ended
                                         December 31,             December 31,
                                      1996         1995         1996        1995
                                      ----         ----         ----        ----

Net Sales                             100.0%      100.0%        100.0%    100.0%
Cost of sales                          69.3        65.2          68.8      62.7
                                      -----       -----         -----     -----
Gross profit                           30.7        34.8          31.2      37.3
Total SG&A expenses                    29.0        25.3          28.8      24.9
                                      -----       -----         -----     -----
Income from operations                  1.7         9.5           2.4      12.4
Interest expense                        5.1         3.6           4.5       4.1
                                      -----       -----         -----     -----
Income (loss) before provision
     (benefit) for income taxes        (3.4)        5.9          (2.1)      8.3
Provision (benefit) for income taxes   (1.4)        2.3          (0.8)      3.3
                                      -----       -----         -----     -----
Net income (loss)                      (2.0)%       3.6%         (1.3)%     5.0%
                                      =====       =====         =====     =====


<PAGE>


RESULTS OF OPERATIONS

Allied  manufactures  and markets  respiratory  therapy  equipment,  medical gas
equipment and emergency medical products. Set forth below is certain information
with respect to amounts  (dollars in  thousands)  and  percentages  of net sales
attributable  to  respiratory  therapy  equipment,  medical  gas  equipment  and
emergency  medical  products for the three months and six months ended  December
31, 1996 compared to the three months and six months ended December 31, 1995.



                                                 Three Months Ended
                                    December 31, 1996         December 31, 1995
                                                 % of                      % of
                                                total                     total
                                    Net         net           Net         net
                                    sales       sales         sales       sales
                                    _____       _____         _____       _____

Respiratory Therapy Equipment      $15,627      55.1%        $15,438      54.3%
Medical Gas Equipment               10,144      35.7%         10,219      35.9%
Emergency Medical Products           2,617       9.2%          2,782       9.8%
                                   -------     ------        -------     ------
Total                              $28,388     100.0%        $28,439     100.0%
                                    ======     =====          ======     =====


                                                    Six Months Ended
                                    December 31, 1996         December 31, 1995
                                                  %of                      % of
                                                total                     total
                                    Net         net           Net         net
                                    sales       sales         sales       sales
                                    _____       _____         _____       _____

Respiratory Therapy Equipment      $31,559      54.9%        $31,776      53.3%
Medical Gas Equipment              $20,240      35.2%         21,480      36.0%
Emergency Medical Products           5,723       9.9%          6,372      10.7%
                                   -------     ------        -------     ------
Total                              $57,522     100.0%        $59,628     100.0%
                                    =======    ======         ======     =====


THREE MONTHS ENDED DECEMBER 31, 1996 COMPARED TO THREE MONTHS ENDED DECEMBER 31,
1995

Net sales for the three  months ended  December  31, 1996 of $28.4  million were
unchanged from net sales of $28.4 million for the same period in the prior year.
Internal and, to a lesser extent, external factors continued to adversely impact
the  Company's  operations  in the second  quarter of fiscal  1997.  The primary
operational  issue that impacted the Company  during the second  quarter was the
inability  to meet the  challenges  caused by the  conversion  to a new computer
system  in the St.  Louis  facility.  This  conversion  caused a  disruption  in
shipping  activity  and  accordingly,  the  Company  had past due  shipments  at
December 31, 1996. These past due shipments are expected to be made in the third
quarter of fiscal 1997. Other internal issues included  capacity  constraints at
the


<PAGE>


Company's Toledo, Ohio facility, field sales force training activities,  and the
integration of recent  acquisitions.  In response to these internal  operational
issues the Company  has put in place  additional  injection  mold  equipment  in
Toledo, Ohio, completed its field sales force training activities,  and has made
progress on its computer conversion  process.  All of these activities have been
previously discussed.  Certain external issues continued to impact the Company's
second  quarter  operations.  In the home health care market,  consolidation  of
dealers has continued to put pressure on prices and  corresponding  margins.  In
addition, Congress has not yet set policy on reimbursement guidelines for oxygen
therapy  reimbursements.  The  effects of  consolidation  of acute  health  care
providers  appears to be improving as the orders from and sales to these markets
are up in the second  quarter of fiscal 1997  compared to the same period in the
prior year. Orders, or the pace of incoming business, for the three months ended
December 31, 1996,  were $31.9  million,  an increase of $2.5 million,  or 8.6%,
over orders of $29.4 million in the prior year  comparable  period.  Fiscal 1997
second quarter orders in all three of the Company's product lines were in excess
of prior year comparable orders. While the Company can not predict when the full
ramifications of its internal and external issues will be resolved,  the Company
believes that over a long term horizon it is positioned  through a broad product
offering and continued internal operational  improvements to meet the demands of
respiratory  health  care  caused by an aging  population,  an  increase  in the
occurrence  and  treatment  of lung  disease,  and other  respiratory  illnesses
treated in the home, hospital, and sub-acute care facilities.

Respiratory  Therapy  Equipment  sales in the second  quarter of fiscal  1997 of
$15.6 million were $0.2 million,  or 1.2%,  over prior year second quarter sales
of $15.4 million. Sales of ventilation products have increased due to the strong
world wide  acceptance of the Smart Trigger  technology for the Company's  adult
critical  care  ventilator  and  due  to the  introduction  of  the  new  infant
ventilator,  the Bear Cub 750R . In  addition,  the Company has  recently  hired
field  sales force  personnel  to address the high  turnover  rates  experienced
during  fiscal 1996.  Training of these new field sales force  personnel and the
combination  of the  ventilation  field sales force with the patient  care field
sales  force has been an  ongoing  project  of the  Company  to  increase  sales
coverage for this  demonstration-based,  sales-intensive  product line. Sales of
home health care  products  were down from the prior year as a result of pricing
pressures  caused by the  ongoing  consolidation  of home  health  care  dealers
combined with renewed concerns over potential  reductions in home oxygen therapy
reimbursement  rates.  While the Company is unable to predict when these factors
will be resolved and the impact of potential  reimbursement policy decisions, it
believes that until there is a resolution,  current customer  purchase  patterns
are likely to continue. The home health care sales were additionally impacted by
capacity  constraints at the Company's  Toledo,  Ohio  facility.  The Company is
currently  installing  new injection  mold  equipment and new molds.  Additional
molds are scheduled for delivery  through April 1997.  While the installation of
equipment  and  molds   previously   delivered  have  been  in  accordance  with
management's   expectations,   there  can  be  no   assurance   that   remaining
installations  will fully alleviate the Company's capacity issues or that market
demand will remain at current levels.

Medical  Gas  Equipment  sales in the  second  quarter  of fiscal  1997 of $10.1
million were $0.1  million,  or 0.7%,  below prior year sales of $10.2  million.
Medical gas suction and  regulation  devices and headwall  sales  experienced an
increase over the second quarter sales in the prior year, which were offset by a
decline in inwall construction  product sales. The order pattern for medical gas
suction and regulation devices has strengthened as it appears that the impact of
consolidation  of health care  providers  is slowing  and their  rationalization
process of consolidation inventory levels is nearing completion.  Management can
not predict when the full  ramifications of such consolidation will be complete,
however, fiscal 1997


<PAGE>


second quarter  orders for these  products are 25.4% over the  comparable  prior
year period.  Inwall construction product orders are unchanged from year to year
while  head wall  orders  are down in the fiscal  1997  second  quarter by 38.9%
compared to the same period in the prior year.  This decrease is attributable to
a one time  order in excess of $1.1  million  received  in the  prior  year.  In
addition,  in April 1996,  Congress  deferred  resolution  of policy for capital
reimbursement  guidelines.  Management  expects  sales of medical gas  equipment
products to continue to be adversely impacted until policy issues are resolved.

Emergency  medical  product  sales in the second  quarter of fiscal 1997 of $2.6
million were $0.2 million, or 5.9% below prior year sales of $2.8 million.  This
sales trend is a continuation of fiscal 1997 first quarter sales patterns as the
sales decline is  attributable  to problems the Company had in the relocation of
production of emergency  products to the St. Louis facility and the absence of a
large  stocking  order that  occurred  in the prior  year.  Orders in the second
quarter of fiscal 1997 for emergency products, however, are 31.4% over orders in
the comparable prior year. This is attributable to several large orders received
late in the  second  quarter  which  will be shipped  primarily  throughout  the
remainder of fiscal 1997.

The Company  continued to increase its presence in world wide markets during the
second quarter of fiscal 1997.  International  sales,  which are included in the
product line sales discussion  above,  increased $0.4 million,  or 5.1%, to $7.9
million in the second  quarter of fiscal 1997  compared to sales of $7.5 million
in the second  quarter of fiscal 1996.  The world wide market  acceptance of the
Smart  TriggerR  technology  for the Company's  adult  critical care  ventilator
combined with the recent introduction of the new Bear Cub 750R infant ventilator
has fueled the growth of international sales.  Partially offsetting the increase
in international ventilator product sales was a decline in international medical
gas equipment and head wall sales which was attributable to a large order in the
prior year.

Gross profit for the second quarter of fiscal 1997 was $8.7 million, or 30.7% of
net sales, compared to $9.9 million, or 34.8% of net sales in the second quarter
of fiscal  1996.  An  unfavorable  product line sales mix, the increase in lower
margin   international   sales,  and  pricing   pressures   brought  on  by  the
consolidation of health care providers all adversely  impacted margins from year
to year.  In addition,  the gross  profit  margin  percentage  was impacted by a
planned  decline in  manufacturing  volume.  The Company  continued  to focus on
working capital  management and did not significantly  build inventory levels as
in the prior year. As a result,  the decline in  manufacturing  volume in fiscal
1997 increased per unit costs of manufacturing  and lowered margins as a percent
of sales. The Company  anticipates  continued pressures on margins caused by the
previously  discussed  external and internal  factors.  In response to declining
margins,  the Company has its focused its resources on two previously  described
significant   capital   expenditure   programs  which  are  designed  to  reduce
manufacturing  costs,  improve  manufacturing cycle times,  improve quality, and
reduce inventory levels.  The Company continues to evaluate its business with an
intent to improve  productivity,  reduce costs,  and initiate vendor programs to
obtain price concessions.  The Company may also implement  additional  strategic
manufacturing programs in the future to improve profitability.

Selling,  General and Administrative  expenses for the six months ended December
31,  1996 were $8.2  million,  an  increase  of $1.0  million  over  prior  year
comparable  period SG&A expenses of $7.2 million.  The Company continued to make
strategic  investments  in SG&A  expenses in the second  quarter of fiscal 1997.
Included  in the second  quarter  SG&A  spending  are  non-recurring  consulting
expenses of approximately $0.4 million. Other SG&A spending includes investments
in advertising and marketing literature,  investments in information technology,
and continued


<PAGE>


investments in research and development, all expenditures that potentially could
benefit future periods.  As a percent of net sales,  SG&A expenses  increased to
29.0% in the second  quarter of fiscal 1997 compared to 25.3% in second  quarter
of fiscal 1996. This increase is attributable to the combined factors of certain
non-recurring   expenditures,   and  the  strategic   investments  in  training,
technology and new product  development  and  essentially  flat Company sales as
discussed above.

Income from  operations in the second quarter of fiscal 1997 of $0.5 million was
$2.2  million,  or 81.8%,  below the second  quarter of fiscal  1996 income from
operations of $2.7 million. As a percentage of net sales, income from operations
decreased to 1.7% from 9.5% for these periods.  This decrease is attributable to
reduced gross margins and the increase in SG&A expenses discussed above.

Interest  expense for the second quarter of fiscal 1997 of $1.4 million was $0.4
million  above  interest  expense of $1.0  million in the prior year  comparable
period. This increase is attributable to an additional $0.2 million amortization
of loan  origination  fees,  (caused  by the  accelerated  maturity  date of our
commercial bank syndicate  credit  facilities),  $0.1 million  attributable to a
higher average debt level,  and $0.1 million  attributable to a higher effective
interest  rate.  Interest  expense is expected to  increase  substantially  as a
result of the modifications to the Company's credit facilities described below.

Allied had a loss  before  provision  for taxes in the second  quarter of fiscal
1997.  The loss of $0.9  million was  partially  offset by a tax benefit of $0.4
million,  resulting in an effective tax rate of 41.2%.  The net loss after taxes
was $0.5  million or $0.07 per share.  Results for the second  quarter of fiscal
1996 were income before taxes of $1.7 million,  a tax provision of $0.7 million,
an effective  tax rate of 40.0%,  net income of $1.0  million,  and earnings per
share of $0.11. The weighted average number of common shares outstanding used in
the calculation of earnings per share was 7,796,682 and 7,744,095 for the second
quarter of fiscal  1997 and  fiscal  1996,  respectively.  The  increase  in the
weighted average number of common shares outstanding was primarily the result of
the effects of the October 1995 sale of 1,610,000 shares of common stock.


SIX MONTHS  ENDED  DECEMBER 31, 1996  COMPARED TO SIX MONTHS ENDED  DECEMBER 31,
1995

Net sales for the six months  ended  December  31,  1996 were $57.5  million,  a
decrease  of $2.1  million,  or 3.5%,  from  sales of $59.6  million in the same
period in the prior  year.  The  decline in net sales for the six  months  ended
December 31, 1996 compared to the same period in the prior year occurred  during
the first  quarter.  Numerous  external and  internal  factors  which  adversely
impacted  the  Company's  sales in fiscal 1996  continued  to impact the Company
during  the first  quarter  of fiscal  1997.  The  macroeconomic  factors  which
impacted the  Company's  sales  included  the renewed  concerns  over  potential
reductions in home oxygen therapy reimbursement levels by Medicare and Medicaid.
Policy decision on this home oxygen therapy  reimbursement issue was deferred by
Congress in April 1996 but debates  renewed  during the first  quarter of fiscal
1997.  The Company is unable to predict the impact of health care  reimbursement
policy  decisions  but believes  that until  reimbursement  issues are resolved,
current customer purchase patterns are likely to continue.  The ramifications of
consolidation  of healthcare  providers  continued to impact certain segments of
the  Company's  product  offerings  in the first  quarter  of fiscal  1997,  but
appeared to  stabilize in the second  quarter of fiscal 1997.  In the acute care
market,  the  continued  rationalization  of  inventory  levels of  medical  gas
regulation devices caused first quarter softness in this market,  however, there
have been  improvements  in second  quarter sales of certain  medical gas system
products. In the home health care market, consolidation of dealers has continued
to put pressure on prices and corresponding margins. Internal operational issues
have also continued to


<PAGE>


impact the Company's operations.  As previously discussed,  the Company has made
progress to address the integration  and management of its recent  acquisitions.
The Company devoted  considerable time and resources during the first six months
of Fiscal 1997 to address these issues.  Included in these  internal  issues are
previous high turnover rates in the ventilation  field sales force for which the
Company had to recruit and train  replacements.  Manufacturing  constraints  and
capacity issues also impacted the Company's operations. In response thereto, the
Company is engaged in two significant  capital  expenditure  projects  discussed
above. Finally, as previously  discussed,  the Company is continuing the process
of  integrating  the  businesses  which have recently been  acquired,  including
actively  upgrading its  information  technology  systems.  While the Company is
unable to predict when the  ramifications  of  macroeconomic  conditions will be
resolved  or  unable  to  provide   assurance  that  internal   issues  will  be
successfully resolved, improvements in orders have been made. Orders for the six
months ended December 31, 1996 were $61.8 million,  an increase of $3.7 million,
or 6.4%,  from orders of $58.1 million in the  comparable  prior year period and
have increased from year to year in all three of the Company's product lines.

Respiratory  therapy equipment sales were $31.6 million for the six months ended
December  31, 1996  compared to sales of $31.7  million for the six months ended
December 31, 1995, a decline of $0.1 million,  or 0.7%. This decline in sales is
attributable to a 9.6% decline in homecare sales caused by pricing pressures and
operational difficulties previously discussed. Partially offsetting this decline
is an 8.1%  increase in sales to  hospital  markets.  This  increase in sales to
hospital  markets  is  primarily  attributable  to the strong  worldwide  market
acceptance of recent  technology  improvements  in the Company's  adult critical
care ventilator and the new infant ventilator.

Medical Gas Equipment  sales for the six months ended December 31, 1996 of $20.2
million were $1.3 million,  or 5.8% below  comparable  prior year sales of $21.5
million. Medical gas system and inwall systems construction products experienced
a decline in sales,  while an increase in headwall sales partially  offset these
declines.  Orders of medical gas products have increased by over $1.9 million in
the first six months of fiscal 1997 compared to the prior year comparable period
as  acute  care  facilities  refurbishing  projects  appear  to  be  increasing.
Although, the consolidation of acute care facilities and the resultant combining
of their  regulation  and  suction  device  inventories  appears to be  slowing,
medical gas  regulation and suction device sales continue to be below prior year
levels.  Orders for these products have increased by 18.8% during the six months
ended December 31, 1996 compared to the comparable  prior year period.  However,
management cannot predict when the full ramifications of such consolidation will
be complete.

Emergency  Medical  Products sales for the six months ended December 31, 1996 of
$5.7 million were $0.7 million,  or 10.2%,  below  comparable  period prior year
sales of $6.4 million.  This decline was due to difficulties  experienced in the
relocation of production of emergency  products to the St. Louis  facility and a
large non-recurring stocking order that occurred in the prior year.

International  sales,  which are  included in the above  discussion  of sales by
product  lines,  increased  $0.9 million,  or 6.3%, to $16.0 million for the six
months ended  December 31, 1996  compared to sales of $15.1  million for the six
months ended December 31, 1995.  This increase in sales is  attributable  to the
strong worldwide acceptance of the Company's  ventilation products combined with
strong sales of the Company's  medical gas equipment.  International  sales were
27.8% of total sales during the six months ended  December 31, 1996  compared to
25.3% of total sales for the six months ended December 31, 1995.


<PAGE>


Gross  profit of $18.0  million  for the six  months  ended  December  31,  1996
declined by $4.2 million,  or 19.2%, from $22.2 million for the six months ended
December 31, 1995. The gross profit margin as a percentage of sales decreased to
31.2% from 37.3% as a result of a change in product  line sales mix,  the change
in the mix of domestic versus international sales, pricing pressures on sales to
national accounts,  and manufacturing  inefficiencies  experienced at one of the
Company's plants.

SG&A expenses for the six months ended December 31, 1996, increased $1.8 million
to $16.6 million, or 12.1%, from $14.8 million for the six months ended December
31,  1995.  The Company has made  significant  investments  in field sales force
training,   promotional  literature  and  advertisements,   and  in  information
technology  throughout  the first six  months  of  Fiscal  1997.  As a result of
decreased net sales  combined  with an increase in spending,  SG&A expenses as a
percentage of net sales increased to 28.8% for the six months ended December 31,
1996 compared to 24.9% for the six months ended December 31, 1995.

Income from  operations  was $1.4 million for the six months ended  December 31,
1996  compared to $7.4 million for the prior year. As a percentage of net sales,
income from  operations  decreased to 2.4% from 12.4% for the same period in the
prior year. This  percentage  decrease in income from operations is attributable
to reduced sales,  reduced gross margins,  and increased SG&A expenses discussed
above.

Interest  expense was $2.5  million for the six months  ended  December 31, 1996
compared  to $2.4  million  for the six months  ended  December  31,  1995.  The
increase  in  interest  expense of $0.1  million is  attributable  to  increased
amortization  of prepaid  loan costs and an increase in the  effective  interest
rate which were partially  offset by a lower average debt balance during the six
months ended  December  31, 1996  compared to the same period in the prior year.
Interest  expense  is  expected  to  increase  substantially  as a result of the
modifications to the Company's credit facilities described below.

Allied had a loss before  provision for taxes for the six months ended  December
31, 1996. The loss of $1.2 million was partially offset by a tax benefit of $0.5
million,  resulting in an effective tax rate of 40.1%.  The net loss after taxes
was $0.7 million, or $0.09 per share.  Results for the six months ended December
31, 1995 were income  before  taxes of $5.0  million,  a tax  provision  of $2.0
million,  an  effective  tax rate of  40.0%,  net  income of $3.0  million,  and
earnings  per share of  $0.43.  The  weighted  average  number of common  shares
outstanding  used in the  calculation  of earnings per share was  7,796,682  and
6,964,825 for the first six months of fiscal 1997 and fiscal 1996, respectively.
The increase in the weighted  average  number of common shares  outstanding  was
primarily  the result of the  October  1995 sale of  1,610,000  shares of common
stock.


FINANCIAL CONDITION

The  following  table  sets  forth  selected  information   concerning  Allied's
financial condition:

        Dollars in thousands         December 31, 1996           June 30, 1996
        ____________________         _________________           _____________
        Cash                              $1,406                    $1,489
        Working Capital                   39,141                    38,030
        Total Debt                        53,931                    52,882
        Current Ratio                       2.85  :1                  2.69  :1


<PAGE>
The Company's  working capital was $39.1 million at December 31, 1996,  compared
to $38.0  million  at June 30,  1996.  Accounts  receivable  increased  to $26.5
million from $26.0 million while  inventories were unchanged at a level of $28.0
million at December  31,  1996 and at June 30,  1996.  The  increase in accounts
receivable  is  primarily  the result of an increase in the average  time that a
receivable is outstanding,  as Days Sales Outstanding ("DSO") increased by seven
days,  and the late in the quarter  sales caused by the  disruption in shipments
early in the quarter.

Net cash used for the six months ended  December 31, 1996 was $0.1 million.  The
net cash used  resulted  from capital  expenditures  and  dividends,  which were
partially  offset by income from  operations (a net after tax loss plus non-cash
operating  charges),  and a net increase in borrowings  under a revolving credit
facility.  The Company  believes  that cash flow from  operations  and available
borrowings  under its amended  revolving  credit  facility will be sufficient to
finance fixed debt service and planned capital expenditures in fiscal 1997.

At December 31, 1996, the Company had aggregate  indebtedness  of $53.9 million,
which  included  short-term  debt of $3.8  million and  long-term  debt of $50.1
million.  During the first half of fiscal 1997,  the Company's debt increased by
$1.0 million from the June 30, 1996 aggregate  indebtedness of $52.9 million. On
September  20,  1996 the Company  amended its  existing  $125.0  million  credit
facilities  with its  commercial  bank  syndicate.  The credit  facilities  were
amended  such  that the  $68.4  million  unused  portion  of the  $70.0  million
acquisition  term loan facility is no longer  available and the remaining credit
facilities' maturity dates were reset to July 31, 1998. In addition,  amendments
were made to reset  certain  covenants  and to increase the advance rates on the
revolving  credit  facility  borrowing  base.  Further,  in connection  with the
amended credit  facilities,  the Company entered into an additional $5.0 million
term loan, also maturing July 31, 1998. The amended credit  facilities  provides
the Company with credit facilities  totaling $60.0 million which can be utilized
to finance  operations and future  growth.  At December 31, 1996 the Company had
total  borrowings  of  $49.6  million  on  these  credit  facilities  and was in
compliance with all covenants or had received  waivers of all covenants in which
it was not in compliance.  In connection  with the receipt of covenant  waivers,
the Company agreed to pay its commercial bank syndicate a fee of $450,000,  plus
$85,000 per month. In addition, the Company agreed that if it did not reduce its
aggregate  borrowings  with the commercial  bank syndicate by $20 million by May
15, 1997 or otherwise  obtain a commitment which would result in proceeds to the
Company of at least $20  million by May 15,  1997,  it would pay the  commercial
bank  syndicate  an  additional  fee of $450,000 on May 15, 1997.  Finally,  the
Company and the agent for the commercial bank syndicate have agreed to negotiate
mutually  satisfactory  revisions  to the  covenants  contained  in  the  credit
facilities  by May 1, 1997.  In December  1996 the Company  entered  into a $1.1
million  capital lease  agreement to partially  finance the St. Louis and Toledo
capital expenditure projects.

As of December 31, 1996, the Company had a backlog of $25.4 million  compared to
a backlog of $21.9 million at September 30, 1996.  The backlog  increase  during
the second  quarter of fiscal  1997 of $3.5  million  consists of an increase in
Respiratory  Therapy  Equipment  of $1.6  million,  an  increase  in Medical Gas
Equipment of $0.5 million, and an increase in Emergency Medical Products of $1.4
million.  The Company's  backlog consists of firm customer purchase orders which
are subject to cancellation by the customer upon notification.  A portion of the
backlog at December 31, 1996 is past due as a result of the shipping  disruption
previously discussed. There have been no significant  cancellations,  if any, of
these  orders.  The  backlog is  expected  to be shipped  within the next twelve
months.

Inflation has not had a material effect on the Company's  business or results of
operations.
<PAGE>


PART II.       OTHER INFORMATION


Item 6.        Exhibits and Reports on Form 8-K

(a)     Exhibits:

        10(1)  Employment Agreement dated as of November 19, 1996 between Allied
Healthcare Products, Inc. and Uma Nandan Aggarwal
        10(2)  Option   Agreement  dated   November  19,  1996  between   Allied
Healthcare Products, Inc. and Uma N. Aggarwal
        10(3)  Option   Agreement  dated  November  19,  1996   between   Allied
Healthcare Products, Inc. and Uma N. Aggarwal
        10(4)  Letter   Agreement  dated   December  16,  1996  between   Allied
Healthcare Products, Inc. and Barry F. Baker
        10(5)  Letter   Agreement  dated  December  16,  1996   between   Allied
Healthcare Products, Inc. and Gabriel S. Kohn
        10(6)  Letter   Agreement   dated   December  16, 1996  between   Allied
Healthcare Products, Inc. and David Grabowski
        10(7)  Letter   Agreement  dated  December  16,  1996   between   Allied
Healthcare Products, Inc. and Theodore H. Atwood
        27     Financial Data Schedule


<PAGE>


                                    SIGNATURE


        Pursuant to the requirements 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.



                                            ALLIED HEALTHCARE PRODUCTS, INC.



Date:   February 14, 1997                   /s/ Barry F. Baker
                                            ____________________________________
                                            Barry F. Baker
                                            Vice President - Finance and
                                              Chief Financial Officer
                                            (Principal Accounting and
                                               Financial Officer)