<Page>

                                   FORM 10-QSB



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

                  For the quarterly period ended July 31, 2001

                           Commission File No. 1-8125


                                  TOROTEL, INC.
        (Exact name of small business issuer as specified in its charter)


            MISSOURI                                   44-0610086
(State or other jurisdiction of            (I.R.S. Employer Identification No.)
 incorporation or organization)


                13402 SOUTH 71 HIGHWAY, GRANDVIEW, MISSOURI 64030
                    (Address of principal executive offices)


                                 (816) 761-6314
                           (Issuer's telephone number)


                                      NONE
(Former name, former address and former fiscal year, if change since last
report)


Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months and (2) has been
subject to such filing requirements for the past 90 days.

                                    Yes X  No
                                       ---   ---

As of September 12, 2001, there were 2,811,590 shares of Common Stock, $.01 Par
Value, outstanding.



<Page>



                         TOROTEL, INC. AND SUBSIDIARIES



                                      INDEX



PART I.  FINANCIAL INFORMATION

         Item 1.  Financial Statements

                  Consolidated Balance Sheet as of July 31, 2001               1

                  Consolidated Statements of Operations for the three months
                           ended July 31, 2001 and 2000                        2

                  Consolidated Statements of Cash Flows for the three months
                           ended July 31, 2001 and 2000                        3

                  Notes to Consolidated Financial Statements                   4

         Item 2.  Management's Discussion and Analysis or Plan of Operation    9


PART II. OTHER INFORMATION

         Item 1.  Legal Proceedings                                           11

         Item 6.  Exhibits and Reports on Form 8-K                            11


SIGNATURES                                                                    12

<Page>

PART I.   FINANCIAL INFORMATION


Item 1.   Financial Statements

CONSOLIDATED BALANCE SHEET (Unaudited)
As of July 31, 2001

<Table>
<S>                                                         <C>
ASSETS

Current assets:
    Cash                                                    $     368,000
    Accounts receivable, net                                      413,000
    Current maturity of note receivable (Note 10)                 151,000
    Inventories (Note 3)                                          294,000
    Prepaid expenses and other current assets                      31,000
                                                            -------------
                                                                1,257,000

Property, plant and equipment, net                                308,000

Note receivable, less current maturity (Note 10)                  122,000

Other assets                                                        3,000
                                                            -------------

                                                              $ 1,690,000
                                                            =============

LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities:
    Current maturities of long-term debt (Note 10)            $   144,000
    Note payable to former officer (Note 9)                       150,000
    Deferred gain on settlement with former officer (Note 9)      411,000
    Trade accounts payable (Note 10)                              764,000
    Accrued liabilities (Note 10)                                 265,000
                                                            -------------
                                                                1,734,000

Long-term debt, less current maturities (Note 10)                 446,000

Stockholders' deficit (Notes 5, 6 and 7):
    Common stock, at par value                                     29,000
    Capital in excess of par value                             10,085,000
    Accumulated deficit                                       (10,399,000)
                                                            -------------
                                                                 (285,000)
    Less treasury stock, at cost                                  205,000
                                                            -------------
                                                                 (490,000)
                                                            -------------

                                                              $ 1,690,000
                                                            =============
</Table>
      The accompanying notes are an integral part of this statement.

                                      1
<Page>

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
Three Months Ended July 31,

<Table>
<Caption>
                                                         2001       2000
                                                      ---------  ---------
<S>                                                   <C>        <C>
Net sales                                             $ 945,000  $ 855,000
Cost of goods sold                                      539,000    551,000
                                                      ---------  ---------

    Gross profit                                        406,000    304,000

Operating expenses:
    Engineering                                          43,000     42,000
    Selling, general and administrative                 202,000    192,000
                                                      ---------  ---------
                                                        245,000    234,000
                                                      ---------  ---------

    Earnings from operations                            161,000     70,000

Other expense (income):
    Interest expense                                     13,000     27,000
    Interest income                                      (6,000)    (8,000)
                                                      ---------  ---------
                                                          7,000     19,000
                                                      ---------  ---------

    Earnings before provision for income taxes
        and extraordinary item                          154,000     51,000

Provision for income taxes (Note 4)                           -          -
                                                      ---------  ---------

    Earnings before extraordinary item                  154,000     51,000

Extraordinary item (Note 8):
    Gain on settlements of debt                          27,000          -
                                                      ---------  ---------

Net earnings                                          $ 181,000  $  51,000
                                                      =========  =========

Basic earnings per share (Note 5):
    Earnings before extraordinary item                    $ .05      $ .02
    Extraordinary item                                      .01          -
                                                          -----      -----
                                                          $ .06      $ .02
                                                          =====      =====

Diluted earnings per share (Note 5):
    Earnings before extraordinary item                    $ .05      $ .02
    Extraordinary item                                      .01          -
                                                          -----      -----
                                                          $ .06      $ .02
                                                          =====      =====
</Table>

     The accompanying notes are an integral part of these statements.

                                      2

<Page>
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
Three Months Ended July 31,
<Table>
<Caption>
                                                          2001        2000
                                                        --------    --------
<S>                                                     <C>         <C>
Cash flows from continuing operating activities:
  Net earnings                                          $181,000    $ 51,000
  Adjustments to reconcile net earnings to net cash
    provided by operations:
     Gain on settlements of debt                         (27,000)          -
     Depreciation and amortization                        14,000      22,000
     Increase (decrease) in cash flows from
       operations resulting from changes in:
         Accounts receivable                              (8,000)    (41,000)
         Inventories                                     (30,000)      2,000
         Prepaid expenses and other assets               (19,000)    (55,000)
         Trade accounts payable                          (15,000)     52,000
         Accrued liabilities                              (5,000)    (16,000)
                                                        --------    --------

Net cash provided by operating activities                 91,000      15,000
                                                        --------    --------

Cash flows from investing activities:
  Proceeds from note receivable                           36,000      32,000
                                                        --------    --------

Net cash provided by investing activities                 36,000      32,000
                                                        --------    --------

Cash flows from financing activities:
  Principal payments on long-term debt                   (78,000)    (48,000)
  Payments on capital lease obligations                   (2,000)     (2,000)
  Note and interest payable to former officer                  -      10,000
                                                        --------    --------

Net cash used in financing activities                    (80,000)    (40,000)
                                                        --------    --------

Net increase in cash                                      47,000       7,000
Cash beginning of three-month period                     321,000      95,000
                                                        --------    --------

Cash end of three-month period                          $368,000    $102,000
                                                        ========    ========


Supplemental Disclosures of Cash Flow Information
  Cash paid during the period for:
    Interest                                            $ 13,000    $ 26,000
</Table>

        The accompanying notes are an integral part of these statements.

                                     3

<Page>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

Note 1 - Basis of Presentation

         Torotel specializes in the custom design and manufacture of a wide
variety of precision magnetic components, consisting of transformers, inductors,
reactors, chokes and toroidal coils. Approximately 94% of Torotel's sales are
derived from domestic customers. The accompanying unaudited consolidated
financial statements reflect the normal recurring adjustments which are, in the
opinion of management, necessary to present fairly Torotel's financial position
at July 31, 2001, and the results of operations for the three months ended July
31, 2001.
         The financial statements contained herein should be read in conjunction
with Torotel's financial statements and related notes filed on Form 10-KSB for
the year ended April 30, 2001.

Note 2 - Future Liquidity

         The accompanying consolidated financial statements have been prepared
in conformity with accounting principles generally accepted in the United States
of America, which contemplate continuation of Torotel as a going concern. At
July 31, 2001, Torotel had negative working capital of $66,000 (exclusive of the
deferred gain described in Note 9 of Notes to Consolidated Financial
Statements), compared to negative working capital of $120,000, $734,000 and
$921,000 at April 30, 2001, 2000 and 1999, respectively. Torotel has been
profitable in each of the past six quarters, and in seven of the last eight.
Furthermore, continuing operations have provided cash in the last four years,
and based on its current forecast for fiscal 2002, management believes operating
cash sufficient for at least one year will be generated. In addition, management
believes the outstanding liabilities associated with the terminated merger in
fiscal 1999 with Electronika, Inc. and the trade debt from a discontinued
subsidiary (see Note 10 of Notes to Consolidated Financial Statements) will be
settled at amounts significantly lower than that carried on the balance sheet.
Management continues to evaluate the Torotel's liquidity position and believes
it has taken all necessary steps to provide Torotel with adequate liquidity to
continue in existence.

Note 3 - Inventories

         The components of inventories are summarized as follows:
<Table>
                  <S>                         <C>
                  Raw materials               $    80,000
                  Work in process                 195,000
                  Finished goods                   19,000
                                              -----------
                                              $   294,000
                                              ===========
</Table>

Note 4 - Income Taxes

     The company has net operating loss carryforwards available as benefits
to reduce future income taxes,

                                        4

<Page>

subject to applicable limitations. These operating loss carryforwards expire in
various amounts in the years 2003 through 2014.

      The difference between the financial and tax bases of assets and
liabilities is determined annually. Deferred income taxes and liabilities are
computed for those differences that have future tax consequences using the
currently enacted tax laws and rates that apply to the periods in which they are
expected to effect taxable income. Valuation allowances are established, if
necessary, to reduce the deferred tax asset to the amount that will, more likely
than not, be realized. Income tax expense is the current tax payable or
refundable for the period plus or minus the net change in the deferred tax
assets or liabilities.

      The following table summarizes the components of the net deferred tax
asset:
<Table>
           <S>                                    <C>
           Net operating loss carryforwards       $2,383,000
           Inventory valuation reserve               190,000
           Tax credit carryforwards                   20,000
           Other                                      43,000
                                                  ----------
                                                   2,636,000
           Less valuation allowance                2,636,000
                                                  ----------
                                                  $        -
                                                  ==========
</Table>

Note 5 - Earnings Per Share

         Statement of Financial Accounting Standards (SFAS) No. 128, EARNINGS
PER SHARE, requires dual presentation of basic and diluted EPS on the face of
the statement of earnings regardless of whether basic and diluted EPS are the
same; and requires a reconciliation of the numerator and denominator used in
computing basic and diluted EPS. Basic EPS excludes dilution and is computed by
dividing earnings available to common stockholders by the weighted average
number of common shares outstanding for the period. Diluted EPS is computed
similarly to fully diluted EPS pursuant to APB Opinion 15. Diluted EPS reflects
the potential dilution that could occur if securities or other contracts to
issue common stock were exercised or converted into common stock or resulted in
the issuance of common stock that then shared in the earnings of the entity.
Pursuant to SFAS No. 128, the basic and diluted earnings per common share were
computed as follows:

<Table>
     YEAR-TO-DATE EPS CALCULATIONS                      2001         2000
                                                    -----------   ----------
     <S>                                            <C>           <C>
        Net earnings                                $   181,000   $    51,000
        Weighted average common shares outstanding    2,811,590     2,811,590
        Incremental shares                                    -             -

        Basic earnings per share                    $       .06   $       .02
        Diluted earnings per share                  $       .06   $       .02
</Table>
        No incremental shares are included in the EPS calculations for either
        period due to the market price of Torotel's common stock being lower
        than the exercise price of the stock equivalents under contract.

                                      5

<Page>

Note 6 - Employee Stock Options

         In accordance with the Incentive Compensation Plan approved by
shareholders on September 19, 1994, Torotel reserved 400,000 common shares for
issuance to key employees pursuant to the exercise of incentive and
non-qualified stock options granted prior to June 20, 2004. The options are
accounted for under APB Opinion 25, ACCOUNTING FOR STOCK ISSUED TO EMPLOYEES,
and related interpretations. The incentive stock options have a term of five
years when issued and vest 50% per year at the end of each of the first two
years. The non-qualified stock options have a term of ten years when issued and
vest 25% per year at the end of each of the first four years. The exercise price
of each option equals the market price of Torotel's common stock on the date of
grant. Accordingly, no compensation cost will be recognized upon the grant of
any options.

         As of July 31, 2001, there were no options outstanding under this Plan.
The fair values of the options granted previously were estimated on the date of
grant using the Black-Scholes options-pricing model. The fair value of the
incentive stock options was determined using the following weighted average
assumptions: no dividend payments over the life of the options; expected
volatility of 106.1%; risk-free interest rate of 6.94%; and expected life of
five years. The fair value of the non-qualified stock options was determined
using the following weighted average assumptions: no dividend payments over the
life of the options; expected volatility of 106.1%; risk-free interest rate of
6.6%; and expected life of ten years.

Note 7 - Stock Warrants

         Pursuant to a settlement that ended a class action alleging racial
discrimination in hiring by Torotel Products, Inc., Torotel agreed to issue a
warrant certificate to the Torotel Settlement Fund to purchase 100,000 shares of
Torotel, Inc. common stock at $.75 per share. The warrant is 100% vested upon
issuance and cannot be exercised until the market price of the company's common
stock reaches $2.00 per share. The warrant expires on May 4, 2003.

         The $33,000 fair value of the warrant was estimated on the date of
grant using the Black-Scholes options-pricing model using the following
weighted average assumptions: no dividend payments over the life of the
warrant; expected volatility of 75.9%; risk-free interest rate of 5.8%; and
expected life of two years.

         Stock warrant transactions for each period are summarized as follows:
<Table>
                                                       2001                               2000
                                             -------------------------          -------------------------
                                             Weighted                           Weighted
                                              Shares          Average            Shares          Average
                                               Under          Exercise            Under          Exercise
                                               Option          Price             Option           Price
                                             --------         --------          --------         --------
<S>                                          <C>              <C>               <C>              <C>
Outstanding at beginning of period            100,000         $  .75             100,000          $  .75
Granted                                          -               -                  -               -
Exercised                                        -               -                  -               -
Forfeited                                        -               -                  -               -
                                             --------                           --------
Outstanding at end of period                  100,000         $  .75             100,000          $  .75
                                             ========                           ========

Warrants exercisable at end of period            -               -                  -               -
     Weighted average fair value of
          warrants granted during the year                       -                                  -
</Table>

                                      6
<Page>

The following information applies to warrants outstanding at July 31, 2001:
<Table>
        <S>                                          <C>
        Number outstanding                           100,000
        Range of exercise prices                      $  .75
        Weighted average exercise price               $  .75
        Weighted average remaining contractual life     1.75 yrs.
</Table>

Note 8 - Extraordinary Item

         For the three months ended July 31, 2001, the extraordinary item as
presented in the accompanying consolidated statements of operations includes a
gain of $27,000 resulting from the settlement of old liabilities at amounts
lower than that originally recorded.


Note 9 - Note Payable to Former Officer and Deferred Gain on Settlement

         On May 6, 1997, Torotel Products, Inc. was accepted into the Voluntary
Disclosure Program of the United States Department of Defense, resulting from
its failure to perform some required "thermal shock" testing as frequently as
required, and inaccurately certifying that all required testing had been
performed. On June 27, 2000, Torotel Products entered into a Release and
Settlement Agreement with the United States of America. Pursuant to the
agreement, Torotel Products agreed to pay an aggregate total of $100,000 over a
nineteen-month period. The aggregate legal fees associated with the testing
deficiencies amounted to $292,000 during the course of the investigation.

      Torotel believed that certain of its former officers may have been
responsible for the misconduct related to the test failures. In February 1997,
Torotel suspended all principal and interest payments due under a note payable
to Alfred F. Marsh, former president and chief executive officer of Torotel. As
of April 30, 2001, the aggregate amount due under the note was $561,000, which
consisted of the outstanding principal of $384,000 plus accrued interest of
$177,000.

         In consideration of a payment of $150,000, Marsh has agreed to forgive
the remaining debt balance of $234,000 and all accrued unpaid interest relating
to the note. In return, Torotel has agreed not to pursue any claims against
Marsh for costs and penalties incurred by Torotel as a result of the thermal
shock testing investigation. Torotel intends to borrow $75,000 to cover half of
the payment. The remaining $75,000 will be paid out of existing cash.

         As a result of this settlement, Torotel will record a credit to net
earnings of $411,000 in the second quarter ending October 31, 2001.


Note 10 - Discontinued Subsidiary

         The operations of East Coast Holdings, Inc. (formerly named OPT
Industries, Inc.), a wholly-owned subsidiary of Torotel, were discontinued in
April 1999, and the assets sold to Shared Information Group

                                        7

<Page>

Management Associates, L.L.C ("SIGMA"). The remaining assets and liabilities
related to this subsidiary as of July 31, 2001, are included in the accompanying
consolidated balance sheet under the following captions and in the amounts
shown:
<Table>
                <S>                                           <C>
                Current maturity of note receivable           $    151,000
                Note receivable, less current maturity        $    122,000
                Current maturities of long-term debt          $     94,000
                Trade accounts payable                        $    435,000
                Accrued liabilities                           $    103,000
                Long-term debt, less current maturities       $     75,000
</Table>

                                        8

<Page>

Item 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

         The following management comments regarding Torotel's results of
operations and outlook should be read in conjunction with the Consolidated
Financial Statements included pursuant to Item 1 of this Quarterly Report.

      The discussion and analysis of the results of operations includes only the
continuing operations of Torotel, Inc. and its subsidiary, Torotel Products,
Inc.

THREE MONTHS ENDED JULY 31, 2001 VERSUS THREE MONTHS ENDED JULY 31, 2000

         Net sales increased nearly 11% from $855,000 to $945,000 because of
increased sales of magnetics products resulting from a higher shippable backlog
at the beginning of the quarter. While Torotel has experienced a 17% decrease in
order bookings for its magnetics products during the first quarter of fiscal
year 2002, its magnetics backlog remains 32% higher than at this time a year
ago. The slower magnetics bookings were offset by a $177,000 order for the
potted coil assembly for the Hellfire II missile system, which will be shipping
during the second and third quarter of this fiscal year. As a result, management
still anticipates a slight increase in sales in fiscal year 2002.

      Gross profit as a percentage of net sales increased 7% primarily because
of increased sales volume, lower material costs associated with the product mix,
and improved labor productivity resulting from ongoing efforts to increase
throughput.

         Engineering expenses increased 2% from $42,000 to $43,000 due to higher
payroll costs. Management does anticipate a slight increase in the present level
of engineering expenses during the next few quarters.

         Selling, general and administrative (SG&A) expenses increased 5% from
$192,000 to $202,000. The SG&A expenses of Torotel, Inc. decreased 19% from
$37,000 to $30,000 primarily because of a decrease in professional fees. The
SG&A expenses of Torotel Products increased 11% from $155,000 to $172,000
primarily because of an $8,000 increase in workers compensation insurance costs
due to a dividend received last year, a $7,000 accrual for incentive
compensation awards, a $4,000 increase in payroll costs, a $4,000 increase in
liability insurance costs, and a $3,000 increase in professional fees. These
increases were offset by a $6,000 decrease in depreciation expense and a $3,000
decrease in sales commissions.

         Interest expense decreased 52%. The interest expense of Torotel, Inc.
decreased 73% from $15,000 to $4,000 because of the settlement reached on the
note payable to a former officer (see Note 9 of Notes to Consolidated Financial
Statements) and a lower principal balance on the guaranteed note with Vista
Bank. The interest expense of Torotel Products decreased 25% from $12,000 to
$9,000 because of lower debt balances.

         Interest income decreased 25% from $8,000 to $6,000 due to a lower
principal balance on the note receivable from SIGMA.

         For the reasons discussed above, the consolidated pretax earnings
increased from $51,000 to $154,000. The pretax loss of Torotel, Inc. decreased
from $44,000 to $28,000. The pretax earnings of Torotel Products increased from
$95,000 to $182,000.

                                        9

<Page>

LIQUIDITY AND CAPITAL RESOURCES

         Torotel relies on funds generated internally to meet its normal
operating requirements and to service bank indebtedness. While there is no
immediate plan to secure any new financing, management continues to evaluate
ways of improving Torotel's liquidity position.

         During the three months ended July 31, 2001, Torotel's operations
provided $91,000 in cash flow because of operating earnings.

         Investing activities provided $36,000 in cash flow because of proceeds
from the note receivable from SIGMA. While Torotel did not have any capital
expenditures during the three months ended July 31, 2001, it does anticipate
approximately $15,000 in capital expenditures during the balance of fiscal 2002.

         Financing activities used $80,000 in cash flow because of decreases in
long-term debt.

         Management believes that inflation will have only a minimal effect on
future operations since such effects will be offset by sales price increases
which are not expected to have a significant effect upon demand.

OTHER

         Except for historical information contained herein, certain of the
matters discussed above are forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995 and are subject to the safe
harbor created by that Act. These statements are based on assumptions about a
number of important factors and involve risks and uncertainties that could cause
actual results to be different from what is stated here. These risk factors are:
decreased demand for products, delays in developing new products, expected
orders that do not materialize, loss of key customers, the impact of competition
and price erosion as well as supply and manufacturing constraints, and other
risks and uncertainties.

                                       10

<Page>

PART II. OTHER INFORMATION


Item 1.  Legal Proceedings

         The remaining liabilities related to a discontinued subsidiary include
trade accounts payable of $435,000 (see Note 10 of Notes to Consolidated
Financial Statements). Several claims have been filed by vendors for collection
of amounts due, and more could be filed. Since the discontinued subsidiary's
remaining assets have been assigned as collateral for the remaining bank debt
and the debt owed to the United States, and most of the remaining proceeds are
targeted for unpaid payroll taxes, this subsidiary has no other source of income
to satisfy its trade debt obligations. This trade debt remains the sole
responsibility of the discontinued subsidiary. Neither Torotel, Inc. or Torotel
Products, Inc. has assumed these obligations. While the claims by vendors may
result in judgments against the discontinued subsidiary, neither Torotel, Inc.
or Torotel Products, Inc. intends to provide any funds to satisfy the judgments.


Item 6.   Exhibits and Reports on Form 8-K

     a)   Exhibits -- None

     b)   Reports on Form 8-K -- There were no reports filed on Form 8-K
          during the three months ended July 31, 2001.

                                       11

<Page>

                                   SIGNATURES

         In accordance with the requirements of the Securities Exchange Act of
1934, the Registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.


Torotel, Inc.
(Registrant)



Date:   September 12, 2001                  /s/  H. James Serrone
      ----------------------                -------------------------------
                                            H. James Serrone
                                            Vice President of Finance and
                                            Chief Financial Officer




                                       12