SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                   FORM 10-Q/A

(Mark One)

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

For the quarterly period ended September 30, 1996

----    Transition  report  pursuant  to  Section  13 or 15(d) of the Securities
        Exchange Action 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 5, 1997 is
7,796,682 shares.


<PAGE>


                                      INDEX


                                                                           Page
                                                                          Number
Part I - Financial Information

               Item 1.       Financial Statements

                             Consolidated Statement
                             of Operations - three months                      3
                             ended September 30,
                             1996 and 1995 (Unaudited)

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

                             Consolidated Statements of Cash
                             Flow - three months ended                     6 - 7
                             September 30, 1996 and 1995 (Unaudited)

                             Consolidated Statement of Changes
                             in Stockholders' Equity for three months          8
                             ended September 30, 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

               Item 6.       Exhibits and Reports on Form 8-K                 19
                             (a) Exhibit
                             (b) Reports of Form 8-K

Signature                                                                     20


<PAGE>

PART I.   FINANCIAL INFORMATION
   Item 1.   Financial Statements


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

                                   Three months ended
                                      September 30,
                              ------------ -----------------
                                  1996            1995
                              ------------ -----------------

Net sales                      $29,133,723      $31,189,032
Cost of sales                   19,893,622       18,851,024
                              -------------  ---------------
Gross profit                     9,240,101       12,338,008

Selling, general and                          
  administrative expenses        8,377,834        7,638,845
                              -------------  ---------------

Income from operations             862,267        4,699,163

Other expenses:                               
  Interest expense               1,115,430        1,373,882
  Other, net                        25,956              (22)
                              -------------  ---------------
                                 1,141,386        1,373,860
                              -------------  ---------------
Income/(loss) before                          
  provision for income taxes      (279,119)       3,325,303

Provision for income taxes        (101,850)       1,329,491
                              -------------  ---------------

Net income/(loss)                ($177,269)      $1,995,812
                              =============  ===============
                                              
Earnings/(loss) per share           ($0.02)           $0.32
                              =============  ===============

Weighted average shares          7,796,682        6,185,555
                              =============  ===============

          See Accompanying Notes to Consolidated Financial Statements.

                                       3
<PAGE>
                                ALLIED HEALTHCARE PRODUCTS, INC.
                                   CONSOLIDATED BALANCE SHEET
                                              ASSETS
<TABLE>

                                                         September 30,     June 30,
                                                             1996            1996
                                                         -------------   -------------
<S>                                                        <C>             <C>  
                                                                          
Current Assets:
   Cash                                                    $1,600,757      $1,489,133
   Accounts receivable, net of allowance for doubtful
      accounts of $387,416 and $422,517, respectively      24,489,434      25,964,658
   Inventories                                             27,217,036      28,046,490
   Income taxes receivable                                    560,872       2,285,224
   Other current assets                                     3,017,467       2,713,497
                                                         -------------   -------------
      Total current assets                                 56,885,566      60,499,002
                                                         -------------   -------------
   Property, plant and equipment, net                      22,166,407      21,968,504
   Goodwill, net                                           52,448,683      52,821,411
   Other assets, net                                        1,837,541       1,471,541
                                                         -------------   -------------
      Total assets                                       $133,338,197    $136,760,458
                                                         =============   =============
 
</TABLE>

          See Accompanying Notes To Consolidated Financial Statements.

                                       4
<PAGE>

                                ALLIED HEALTHCARE PRODUCTS, INC.
                                  CONSOLIDATED BALANCE SHEET
                                          (CONTINUED)
                              LIABILITIES AND STOCKHOLDERS' EQUITY
<TABLE>

                                                         September 30,     June 30,
                                                             1996            1996
                                                         -------------   -------------
<S>                                                       <C>             <C> 
                                                         
Current liabilities:
   Accounts payable                                       $13,616,195     $13,104,299
   Current portion of long-term debt                        3,856,212       3,848,780
   Other current liabilities                                4,383,595       5,516,045
                                                         -------------   -------------
      Total current liabilities                            21,856,002      22,469,124
                                                         -------------   -------------
Long-term debt                                             46,401,675      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 September 30, 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                                       37,393,326      37,570,595
                                                         -------------   -------------
                                                           63,708,871      63,886,140
      Total stockholders' equity                         -------------   -------------
                                                         $133,338,197    $136,760,458
      Total liabilities and stockholders' equity         =============   =============


          See Accompanying Notes To Consolidated Financial Statements.

                                       5
<PAGE>


                        ALLIED HEALTHCARE PRODUCTS, INC.
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                                   (UNAUDITED)

                                                         Three Months ended
                                                            September 30,
                                                   -----------------------------
<S>                                                <C>             <C> 
                                                       1996            1995
Cash flows from operating activities:              -------------   -------------
   Net income (loss)                                  ($177,269)     $1,995,812
   Adjustments to reconcile net income to 
       net cash provided by (used in)
       operating activities:
      Depreciation and amortization                   1,241,126         966,416
      Decrease in accounts receivable, net            1,475,224         601,229
      Decrease (increase) in inventories                829,454      (4,556,761)
      Decrease in income taxes receivable             1,724,352               0
      Decrease (increase) in other current assets      (303,970)        230,725
      Increase in accounts payable                      511,896       4,335,341
      Increase in accrued income taxes                        0       1,207,074
      Decrease in other current liabilities            (586,682)     (1,943,446)
                                                   -------------   -------------
       Net cash provided by operating activities      4,714,131       2,836,390
                                                   -------------   -------------
                                                    
Cash flows from investing activities:
   Capital expenditures                                (983,176)       (363,498)
                                                   -------------   -------------
       Net cash used in investing activities           (983,176)       (363,498)
                                                   -------------   -------------

                                   (CONTINUED)
</TABLE>
                                       6
<PAGE>

<TABLE>




                           ALLIED HEALTHCARE PRODUCTS, INC.
                         CONSOLIDATED STATEMENT OF CASH FLOWS
                                      (CONTINUED)

                                                        Three Months ended
                                                           September 30,
                                                   -----------------------------
                                                       1996            1995
                                                   -------------   -------------
<S>                                                 <C>             <C>  

Cash flows from financing activities:
   Proceeds from issuance of long-term debt           5,000,000               0
   Payments of long-term debt                        (1,124,438)     (1,117,408)
   Borrowings under revolving credit agreement        4,000,000       5,000,000
   Payments under revolving credit agreement        (10,500,000)     (5,000,000)
   Issuance of common stock                                   0           8,805
   Debt issuance costs                                 (449,125)              0
   Dividends paid on common stock                      (545,768)       (432,986)
                                                   -------------   -------------
       Net cash used by financing activities         (3,619,331)     (1,541,589)
                                                   -------------   -------------

   Net increase in cash and equivalents                 111,624         931,303
   Cash and equivalents at beginning of period        1,489,133         174,952
                                                   -------------   -------------
   Cash and equivalents at end of period             $1,600,757      $1,106,255
                                                   =============   =============

</TABLE>


          See Accompanying Notes To Consolidated Financial Statements.


                                       7
<PAGE>

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



<TABLE>
<S>                      <C>         <C>       <C>           <C>           <C>   

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

Net income for the
   Three Months ended
   September 30, 1996                                                       (177,269)
                        ---------- ---------- ------------ ------------- ------------
Balance,
September 30, 1996             $0   $101,002  $46,945,971  ($20,731,428) $37,393,326
                        ========== ========== ============ ============= ============
</TABLE>

          See Accompanying Notes To Consolidated Financial Statements.

                                       8
<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
<TABLE>

               Inventories are comprised as follows:

                                                                 September 30,              June 30,
                                                                     1996                     1996
                                                                  (Unaudited)
               <S>                                               <C>                   <C> 

               Raw Material                                      $     208,878         $     179,042
               Work-in-progress                                      2,418,377             2,563,773
               Component Parts                                      17,937,307            18,428,851
               Finished Goods                                        6,652,474             6,874,824
                                                                 -------------         -------------
                                                                   $27,217,036           $28,046,490
                                                                 =============         =============
</TABLE>


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

                                       9
<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 September 30, 1996, the
Company had total borrowings of $47.9 million on these credit facilities and was
in compliance with all covenants.

        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.

                                       10
<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 months ended September
30, 1996 compared to the three months ended  September 30, 1995. This discussion
should be read in conjunction with the September 30, 1996 consolidated financial
statements and  accompanying  notes thereto included in this Quarterly Report on
Form 10-Q for the quarter ended September 30, 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,  difficulties or delays in the introduction of new products
or disruptions in selling 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  $1.4 million in
annual goodwill  amortization  expense. The following table summarizes the seven
acquisitions:

<TABLE>
<S>                   <C>                                             <C>                                    <C>

Date                  Business                                        Products                              Purchase Price
                                                                                                        (Dollars in millions)
-----------------------------------------------------------------------------------------------------------------------------
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")      Mon itoring 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>

                                       11
<PAGE>

These  seven  acquisitions  have  strategically  placed the  Company in the high
growth 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 first quarter of fiscal 1997.


Included in these activities are field sales force  consolidation  and training,
the development and release of new products,  information  system  enhancements,
and capital expenditure projects.  Progress made by the Company during the first
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.  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  his or her  relationships  with  customers.  The
training  required for this  consolidation  was completed in September  1996 for
half of the field sales  force and  training  is  expected  to be  completed  in
November  1996 for the  remaining  half of the  field  sales  force.  The  first
ventilation  product  sales  (a  multiple  ventilator  order),  made by a former
patient care specialist, occurred in October 1996.

Research and Development and New Product Releases
-------------------------------------------------

Consistent with its focus on more technologically-advanced products, the Company
has increased the level of its research and development  activities in the first
quarter of fiscal 1996, compared to the prior year by 13.5%, to $1.0 million and
anticipates committing more resources to research and development in the future.
Expenditures  for  research  and  development   activities   primarily   include
developing  new  respiratory  therapy  products and updating  current  products.
During the first quarter of fiscal 1997,  the Company  introduced the Connect II
universal  medical gas outlet and has received  510K  approval from the Food and
Drug  Administration  ("FDA") for its new Bear Cub 750R infant  ventilator.  The
Company is  currently  investing  in other  research  and  development  projects
designed to enhance patient treatment, provide a greater ease of patient use and
to lower production costs.

                                       12
<PAGE>

Information Systems Enchancements
---------------------------------

The Company  made  substantial  progress  in  implementing  updated  information
systems  technology  during the first  quarter of fiscal 1997.  In October 1996,
immediately subsequent to the first quarter, the Company converted its Corporate
Offices and its St. Louis  manufacturing  operations  to a new fully  integrated
software  system and plans to convert all of its operations by the end of fiscal
1997. 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 is in the process of  modernizing  two of its primary  manufacturing
facilities.  In May and  June of  1996,  the  Company  purchased  five  computer
controlled machining centers and, in the first quarter of fiscal 1997, began the
programming  and  installation  process  for this  machinery  in its St.  Louis,
Missouri facility. This $1.5 million investment will substantially modernize the
Company's metal machining  capabilities and is expected to result in significant
opportunities to reduce product costs from shorter set-up times,  elimination of
secondary  operations  in component  manufacturing,  reduced  inventory  levels,
reductions in scrap and  improvements in quality.  The project is expected to be
completed by December 31, 1996.

During  fiscal  1996,   Allied's  production  of  its  disposable  products  was
constrained by outdated  molds and injection  molding  machinery.  Manufacturing
inefficiencies and capacity  constraints  prevented the Company from shipping to
the level of demand for  certain  products.  Accordingly,  the Company is in the
process of investing  $2.0 million in molds and injection  molding  machinery to
expand  the  production  capacity  and gain  efficiencies  at its  Toledo,  Ohio
facility.   This  investment  in  enhanced  injection  molding  capabilities  is
expected, when complete, to increase annual production throughout by 20%, and to
provide  significant  cost reduction  opportunities,  including  reduced product
material content,  labor and utility costs, while improving overall quality. The
injection molding  equipment and molds have periodic delivery  schedules through
December 31, 1996. 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 first 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.

                                       13
<PAGE>

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
                                          September 30,
                                       1996           1995
                                       ----           ----

Net Sales                              100.0%         100.0%
Cost of sales                           68.3           60.4
                                       -------        -------
Gross profit                            31.7           39.6
Total SG&A expenses                     28.7           24.4
                                       -------        -------
Income from operations                   3.0           15.2
Interest expense                         3.9            4.5
                                       -------        -------
Income (loss) before provision
     [benefit] for income taxes         (0.9)          10.7
Provision [benefit] for income taxes    (0.3)           4.3
                                       --------       -------
Net income [loss]                       (0.6)%          6.4%
                                       ========       =======

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  ended  September  30,  1996
compared to the three months ended September 30, 1995.

<TABLE>


                                    Three Months Ended           Three Months Ended
                                    September 30, 1996           September 30, 1995
<S>                                 <C>           <C>            <C>            <C>      
                                                   % of                         % of
                                                   total                        total
                                    Net            net           Net            net
                                    sales          sales         sales          sales
                                    -----          -----         -----          -----
Respiratory Therapy  Equipment      $15,932        54.7%         $16,338        52.4%
Medical Gas Equipment                10,096        34.6%          11,261        36.1%
Emergency Medical Products            3,106        10.7%           3,590        11.5%
                                    -------       ------         --------      ------
Total                               $29,134       100.0%         $31,189       100.0%
                                    =======       =====          =======       =====
</TABLE>

Three   months  ended   September  30,  1996  compared  to  three  months  ended
September 30, 1995
--------------------------------------------------------------------------------

Net  sales  for the three  months  ended  September  30,  1996 of $29.1  million
decreased $2.1 million,  or 6.6%, compared to net sales of $31.2 million for the
three months ended September 30, 1995.  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.  Certain  macroeconomic
factors  impacting  the  Company's  sales  include  the  renewed  concerns  over
potential 

                                       14
<PAGE>

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. 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 acute care market,  the continued  rationalization of
inventory levels for medical gas regulation  devices has caused softness in this
market,  however,  there  have been signs of an upturn in  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 impact the Company's  operations.  As
previously  discussed,  the Company has made significant progress to address the
integration  and  management  of its recent  acquisitions.  The Company  devoted
considerable  time and  resources  during the first  quarter  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 macroeconomic  conditions will be resolved or provide assurance
that internal issues will be successfully  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 first quarter of fiscal 1997 of $15.9
million were $0.4  million,  or 2.4%,  under prior year first  quarter  sales of
$16.3 million.  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  equipment and molds are  scheduled for delivery  through
December 31, 1996.  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.  Offsetting
the decline in home  health  care sales was an increase in sales of  ventilation
products.  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. In addition,  the increase in  ventilation  product sales is being
driven by the strong world wide  acceptance of the

                                       15
<PAGE>

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.

Medical Gas Equipment sales in the first quarter of fiscal 1997 of $10.1 million
were $1.2 million,  or 10.4%,  below prior year sales of $11.3 million.  Medical
gas  system  sales were  slightly  below  prior  year  sales and inwall  systems
construction  products also experienced a decline in sales, while an increase in
headwall sales partially offset these declines.  Orders of construction products
have increased by over $0.8 million in the first quarter of fiscal 1997 compared
to the prior  year  comparable  period  as acute  care  facilities  refurbishing
projects  appear to be  increasing.  Medical gas  regulation  and suction device
sales continue to be below prior year levels.  The  consolidation  of acute care
facilities  and the resultant  combining of their  regulation and suction device
inventories have caused a decline in demand for these products as the acute care
providers continue to rationalize their consolidated inventory levels. While the
consolidation of health care providers appears to be slowing,  management cannot
predict when the full ramifications of such  consolidation will be complete.  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  Products sales of $3.1 million were $0.5 million,  or 13.5%,
below prior year first quarter  sales of $3.6  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.

The Company  continued to increase its presence in world wide markets during the
first  quarter of fiscal 1997.  International  sales,  which are included in the
product line sales discussion  above,  increased $0.6 million,  or 7.7%, to $8.1
million in the first quarter of fiscal 1997 compared to sales of $7.5 million in
the first 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.   Offsetting  the  increase  in
international  ventilator  product  sales was a decline in medical gas equipment
sales which was attributable to a large, non-recurring construction order in the
prior  year  and a  decline  in sales  to  Mexico  caused  by  adverse  economic
conditions. Gross profit of $9.2 million in the first quarter of fiscal 1997 was
$3.1 million, or 25.1%, below gross profit of $12.3 million in the first quarter
of fiscal 1996. The decline in sales  combined with an unfavorable  product line
sales mix,  the  increase in lower  margin  international  sales,  and  customer
pricing  pressures  brought on by the consolidation of health care providers all
adversely  impacted  margins from year to year.  Gross profit as a percentage of
sales was 31.7% and 39.6% during the first  quarter of fiscal 1997 and the first
quarter of fiscal 1996,  respectively.  The gross profit margin  percentage  was
impacted by production volume and changes in inventory levels.  During the first
quarter of fiscal  1996,  the Company  increased  its  inventory  levels by $4.5
million, in anticipation of future market demand, which in turn lowered per unit
production costs and improved margins.  Conversely,  in fiscal 1997, the Company
reduced its inventory levels by approximately  $1.0 million through its focus on
working  capital  management  and reduced  manufacturing  volume,  which in turn
increased  per unit costs of production  and lowered  margins as a percentage of
sales.  The Company

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<PAGE>

anticipates  continued  pressures on margins caused by the previously  discussed
external and internal factors. In response to declining margins, the Company has
embarked upon two 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 ("SG&A") expenses were $8.4 million in the
first quarter of fiscal 1997, an increase of $0.7 million,  or 9.7%,  over prior
year comparable  period SG&A expenses of $7.6 million.  The Company continued to
make strategic  investments in SG&A spending  during the first quarter of fiscal
1997. The Company believes it is essential to improve the skill set of its field
sales force, many of whom have been put in place during the past six months, and
to provide  necessary  resources to support their efforts.  Accordingly,  Allied
continued its investments in extensive  field sales force training,  investments
in  advertising  and  promotions,  investments in  information  technology,  and
investments in research and development,  all of which are examples of increased
SG&A  expenditures  that  could  potentially  benefit  future  operations.  As a
percentage of net sales,  SG&A expenses  increased to 28.8% in the first quarter
of fiscal  1997  compared  to 24.4% in the first  quarter of fiscal  1996.  This
increase  is  attributable  to the  combined  factors  of a decline  in sales of
existing products and the strategic investments in training,  technology and new
products.

Income from  operations  in the first quarter of fiscal 1997 of $0.9 million was
$3.8  million,  or 81.7%,  below the first  quarter of fiscal  1996  income from
operations of $4.7 million. As a percentage of net sales, income from operations
decreased to 3.0% from 15.1% for these periods. This decrease is attributable to
reduced  sales,  reduced  gross  margins,  and the  increase  in  SG&A  expenses
discussed above.

Interest  expense for the first  quarter of fiscal 1997 of $1.1 million was $0.3
million below interest  expense of $1.4 million in the prior year. This decrease
is  primarily  attributable  to the  reduction  in  the  Company's  debt  level,
utilizing the proceeds from a secondary  stock offering  completed on October 4,
1995,  by an average of  approximately  $19.0 million this year versus the prior
year.  In addition,  Allied's  effective  interest rate for the first quarter of
fiscal 1997 was  approximately  50 basis  points  lower than for the prior year.
Offsetting these interest expense reductions was an increase in the amortization
of loan origination fees for the credit facilities put into place on October 13,
1995 and amended on September 20, 1996.


Allied  had a loss  before  provision  for taxes in the first  quarter of fiscal
1997.  The loss of $279,000 was  partially  offset by a tax benefit of $102,000,
resulting  in an  effective  tax rate of  36.5%.  The net loss  after  taxes was
$177,000 or $0.02 per share.  Results for the first  quarter of fiscal 1996 were
income  before  taxes of $3.3  million,  a tax  provision  of $1.3  million,  an
effective tax rate of 40.0%, net income of $2.0 million,  and earnings per share
of $0.32. The weighted  average number of common shares  outstanding used in the
calculation  of earnings per share was  7,796,682  and  6,185,555  for the first
quarter of fiscal  1997 and  fiscal  1996,  respectively.  The  increase  in the

                                       17
<PAGE>

weighted average number of common shares outstanding was primarily the result of
the  October  1995  sale of  1,610,000  shares of  common  stock in a  secondary
offering.

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

        Dollars in thousands        September 30, 1996           June 30, 1996
        --------------------        ------------------           -------------
        Cash                           $1,601                        $1,489
        Working Capital                35,030                        38,030
        Total Debt                     50,258                        52,882
        Current Ratio                    2.60  :1                      2.69  :1

The Company's working capital was $35.0 million at September 30, 1996,  compared
to $38.0  million  at June 30,  1996.  Accounts  receivable  decreased  to $24.5
million from $26.0  million  while  inventories  decreased  to $27.2  million at
September 30, 1996 from $28.0 million at June 30, 1996. The decrease in accounts
receivable  is  primarily  the result of a decrease in the  average  time that a
receivable is outstanding,  as Days Sales Outstanding  ("DSO") declined by three
days,  as well as a  decrease  in revenue  in the first  quarter of fiscal  1997
compared to the fourth  quarter of fiscal  1996.  The decline in  inventory  was
attributable to the Company's  efforts to reduce working  capital.  Accordingly,
production volume decreased during the quarter.

Net cash  generated  for the three  months  ended  September  30,  1996 was $0.1
million. The net cash provided resulted from income from operations (a net after
tax  loss  plus  non-cash  operating  charges),   and  a  decrease  in  accounts
receivables  and  inventories  which were partially  offset by debt  repayments,
capital expenditures and dividends.  The reduction in net income during the last
three  quarters of fiscal  1996 and during the first  quarter of fiscal 1997 has
significantly  impacted  cash flows and the  ability of the  Company to continue
historical  levels of fixed  payments.  Accordingly,  on August  21,  1996,  the
Company's  Board of Directors  voted to suspend  quarterly  dividends  effective
immediately   with  the  fourth   quarter  of  fiscal  1996.  The  Company  also
renegotiated its credit facilities and on September 20, 1996 amended its current
credit  facilities  with its commercial bank syndicate as described  below.  The
Company believes that subsequent to the suspension of cash dividends,  cash flow
from  operations and available  borrowings  under its amended  revolving  credit
facility,  discussed below, will be sufficient to finance fixed debt service and
planned capital expenditures in fiscal 1997.

At September 30, 1996, the Company had aggregate  indebtedness of $50.3 million,
which  included  short-term  debt of $3.9  million and  long-term  debt of $46.4
million.  During the first quarter of fiscal 1997,  the Company's debt decreased
by $2.6 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,

                                       18
<PAGE>

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 September  30, 1996 the Company had total  borrowings of
$47.9  million  on  these  credit  facilities  and was in  compliance  with  all
covenants.

As of September 30, 1996, the Company had a backlog of $21.9 million compared to
a backlog of $21.0  million at June 30, 1996.  The backlog  increase  during the
first  quarter  of  fiscal  1997 of $0.9  million  consists  of an  increase  in
Respiratory  Therapy  Equipment of $0.4 million,  and an increase in Medical Gas
Equipment of $1.1 million which were partially  offset by a decline in Emergency
Medical  Products  of $0.6  million.  The  Company's  backlog  consists  of firm
customer  purchase orders which are subject to cancellation by the customer upon
notification.  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.

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<PAGE>



PART II.       Other Information


Item 6.        Exhibits and Reports on Form 8-K

(a)     Exhibit 

27      Financial Data Schedule

(b)     Reports on Form 8-K dated August 7, 1996.


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<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 5, 1997            /s/ Barry F. Baker
                                    -----------------------------------
                                    Barry F. Baker
                                    Vice President - Finance and Chief Financial
                                                     Officer
                                    (Principal Accounting and Financial Officer)


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