<PAGE>

                                     FORM 10-QSB

                          SECURITIES AND EXCHANGE COMMISSION
                               Washington, D. C.  20549


                      QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
                        OF THE SECURITIES EXCHANGE ACT OF 1934


              For Quarter Ended 04-30-97  Commission File Number 0-2865
                                                                 ------

                                  UNIVERSAL MFG. CO.
                                  --------- ---- ---
                (Exact name of Registrant as specified in its Charter)


               NEBRASKA                             42 0733240
               --------                             -- -------
       (State or other jurisdiction of           (I.R.S. Employer
       incorporation or organization)           Identification No.)


       405 Diagonal St., P. O. Box 190, Algona, Iowa       50511
       --- -------- ---- -- -- --- ---- ------- ----       -----
       (Address of principal executive offices)          (Zip Code)


 Registrant's telephone number, including area code (515)-295-3557
                                                    ---------------

                                    NOT APPLICABLE

------------------------------------------------------------------
Former name, former address and former fiscal year if changed
since last report.


"Indicate by check mark whether the Registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act during the preceding 12 months (or for
such shorter period that the Registrant was required to file such
reports), and (2) has been subject to such filing requirements for
the past 90 days."
                       YES   X       NO
                           -- --        -----

"Indicate the number of shares outstanding of each of the
issuer's classes of common stock as of the latest practicable
date"


    Number of shares outstanding as of 04-30-1997      816,000
                                                       -------
                                                       Common

     Transitional Small Business Disclosed Format (Check One):

                       YES           NO    X
                            -----        -- --





                                          1

<PAGE>

                                  UNIVERSAL MFG. CO.

                                     FORM 10-QSB

                                        INDEX



Part I   FINANCIAL INFORMATION                                PAGES
         --------- -----------                                -----

         Item 1.  Financial Statements:


          Balance Sheets - April 30, 1997
            (unaudited) and July 31, 1996                          3

          Statements of Income and Retained Earnings -
            Nine Months Ended April 30, 1997
            and 1996 (unaudited)                                   4

          Statements of Income and Retained Earnings -
            Three Months Ended April 30, 1997
            and 1996 (unaudited)                                   5

          Statements of Cash Flows -
            Nine Months Ended April 30, 1997
            and 1996 (unaudited)                                   6

          Statements of Cash Flows -
            Three Months Ended April 30, 1997
            and 1996 (unaudited)                                   7

          Notes to Financial Statements                           8-9


         Item 2.  Management's Discussion and Analysis of
                  Financial Condition and Results of Operations   10


Part II  OTHER INFORMATION

         Item 1.  Legal Proceedings                               10

         Item 2.  Changes in Securities                           10

         Item 3.  Defaults Upon Senior Securities                 10

         Item 4.  Submission of Matters to a Vote of Security
                  Holders                                         10

         Item 5.  Other Information                               10

         Item 6.  Exhibits and Reports on Form 8-K                10


Signatures                                                        11






                                          2


<PAGE>

                            ITEM 1.  FINANCIAL STATEMENTS

UNIVERSAL MFG. CO. 
BALANCE SHEETS
                                                  April 30,
                                                    1997           July 31,
                                                 (Unaudited)        1996
                                              --------------     -------------
ASSETS

CURRENT ASSETS:
  Cash and cash equivalents                       $947,804          $934,072 
  Accounts receivable                            1,479,213         1,654,992 
  Inventories                                    3,073,163         2,479,713 
  Income taxes recoverable                          52,995                 - 
  Prepaid expenses                                 102,571            50,282 
                                             --------------     -------------
  Total current assets                           5,655,746         5,119,059 
                                             --------------     -------------
Deferred Income Taxes                               42,329            42,329 
                                             --------------     -------------
Lease Receivable                                    17,231            26,073 
                                             --------------     -------------
PROPERTY - At cost
  Land                                             120,499           120,499 
  Buildings                                      1,141,123         1,099,594 
  Machinery and equipment                          936,748           899,997 
  Furniture and fixtures                           206,468           209,947 
  Trucks and automobiles                           742,258           699,240 
                                             --------------     -------------
  Total property                                 3,147,096         3,029,277 
  Less accumulated depreciation                 (2,007,088)       (1,985,412)
                                             --------------     -------------
  Property - net                                 1,140,008         1,043,865 
                                             --------------     -------------
                                                $6,855,314        $6,231,326 
                                             --------------     -------------
                                             --------------     -------------

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
  Accounts payable                              $1,945,014        $1,507,944 
  Dividends payable                                204,000           204,000 
  Payroll taxes                                     11,100            10,539 
  Income taxes payable                                   -            56,790 
  Accrued compensation                              52,464            90,046 
  Accrued local taxes                               13,884            13,984 
                                             --------------     -------------
  Total current liabilities                      2,226,462         1,883,303 
                                             --------------     -------------
STOCKHOLDERS' EQUITY
  Common stock, $1 par value,   
    authorized,  2,000,000 shares,
    issued and outstanding,  816,000 shares        816,000           816,000 
  Additional paid-in capital                        17,862            17,862 
  Retained earnings                              3,794,990         3,514,161 
                                             --------------     -------------
  Total stockholders' equity                     4,628,852         4,348,023 
                                             --------------     -------------
                                                $6,855,314        $6,231,326 
                                             --------------     -------------
                                             --------------     -------------





                                          3


<PAGE>

UNIVERSAL MFG. CO. 
STATEMENTS OF INCOME AND RETAINED EARNINGS
(UNAUDITED)

                                                  Nine Months Ended
                                         ----------------------------------
                                            April 30,           April 30,
                                              1997                1996
                                         --------------       -------------
NET SALES                                  $14,112,798        $12,900,800 

COST OF GOODS SOLD                          11,168,363         10,086,717 
                                         --------------      -------------
GROSS PROFIT                                 2,944,435          2,814,083 

SELLING, GENERAL AND
  ADMINISTRATIVE EXPENSES                    1,535,191          1,483,394 
                                         --------------      -------------

INCOME FROM OPERATIONS                       1,409,244          1,330,689 
                                         --------------      -------------

OTHER INCOME:
  Interest                                      42,815             31,294 
  Other income                                  11,595             10,684 
                                         --------------      -------------
  Total other income                            54,410             41,978 
                                         --------------      -------------

INCOME BEFORE INCOME TAXES                   1,463,654          1,372,667 

INCOME TAXES                                   570,825            542,864 

                                         --------------      -------------
NET INCOME                                     892,829            829,803 

RETAINED EARNINGS, Beginning of period       3,514,161          3,073,307 

DIVIDENDS                                     (612,000)          (489,600)
                                         --------------      -------------
RETAINED EARNINGS, End of period            $3,794,990         $3,413,510 
                                         --------------      -------------
                                         --------------      -------------

EARNINGS PER COMMON SHARE:

 Earnings per common share                       $1.09              $1.02 
                                         --------------      -------------
                                         --------------      -------------







                                          4


<PAGE>

UNIVERSAL MFG. CO.
STATEMENTS OF INCOME AND RETAINED EARNINGS
(UNAUDITED)

                                                 Three Months Ended
                                         ----------------------------------
                                             April 30,           April 30,
                                              1997                1996
                                         --------------       -------------
NET SALES                                   $4,463,762         $4,546,240 

COST OF GOODS SOLD                           3,609,911          3,504,152 
                                         --------------      -------------
GROSS PROFIT                                   853,851          1,042,088 

SELLING, GENERAL AND
  ADMINISTRATIVE EXPENSES                      525,906            520,151 
                                         --------------      -------------

INCOME FROM OPERATIONS                         327,945            521,937 
                                         --------------      -------------

OTHER INCOME:
  Interest                                      15,631             10,124 
  Other income                                   2,504              3,046 
                                         --------------      -------------
  Total other income                            18,135             13,170 
                                         --------------      -------------

INCOME BEFORE INCOME TAXES                     346,080            535,107 

INCOME TAXES                                   134,971            216,216 

                                         --------------      -------------
NET INCOME                                     211,109            318,891 

RETAINED EARNINGS, BEGINNING OF QUARTER      3,787,881          3,257,819 

DIVIDENDS PAID                                (204,000)          (163,200)
                                         --------------      -------------
RETAINED EARNINGS, END OF QUARTER           $3,794,990         $3,413,510 
                                         --------------      -------------
                                         --------------      -------------

EARNINGS PER COMMON SHARE:

 Earnings per common share                       $0.26              $0.39 
                                         --------------      -------------
                                         --------------      -------------











                                          5


<PAGE>

UNIVERSAL MFG. CO.
STATEMENTS OF CASH FLOWS
(UNAUDITED)


<TABLE>
<CAPTION>
                                                                          Nine Months Ended
                                                                 --------------------------------
                                                                   April 30,           April 30,
                                                                    1997                1996
                                                                 ------------        ------------
<S>                                                              <C>                 <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income                                                       $892,829            $829,803 
Adjustments to reconcile net income to
 net cash from operating activities:
  Depreciation                                                    146,951             141,993 
  Gain on sale of property                                         (2,459)             (1,547)
Changes in operating assets and liabilities:
  Accounts receivable                                             175,779             112,560 
  Inventories                                                    (593,450)            (28,861)
  Prepaid expenses                                                (52,289)             25,115 
  Income taxes recoverable                                        (52,995)            109,646 
  Lease receivable                                                  8,842               7,464 
  Accounts payable                                                437,070             128,823 
  Payroll taxes                                                       561              17,647 
  Accrued compensation                                            (37,582)            (14,994)
  Accrued local taxes                                                 100             109,266 
  Income taxes payable                                            (56,790)              4,442 
                                                            --------------       -------------
Net cash flows from operating activities                          866,367           1,441,357 
                                                            --------------       -------------

CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale of property                                     10,200               2,874 
Purchases of property                                            (250,835)           (199,212)
Proceeds from maturities of investments                                 -              67,597 
                                                            --------------       -------------
Net cash flows from investing activities                         (240,635)           (128,741)
                                                            --------------       -------------

CASH FLOWS FROM FINANCING ACTIVITIES:
Payment of dividends                                             (612,000)           (489,600)
                                                            --------------       -------------

NET CHANGE IN CASH AND CASH EQUIVALENTS                            13,732             823,016 

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD                  934,072             210,467 
                                                            --------------       -------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD                       $947,804          $1,033,483 
                                                            --------------       -------------
                                                            --------------       -------------

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during period for:
  Income taxes                                                   $680,610            $428,776 
                                                            --------------       -------------
                                                            --------------       -------------
</TABLE>







                                          6


<PAGE>

UNIVERSAL MFG., CO. 
STATEMENTS OF CASH FLOWS
(UNAUDITED)


<TABLE>
<CAPTION>
                                                                  Three Months Ended
                                                         -----------------------------------
                                                             April 30,          April 30,
                                                              1997                 1996
                                                         --------------        -------------
<S>                                                         <C>                 <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income                                                  $211,109            $318,891 
Adjustments to reconcile net income to
 net cash from operating activities:
  Depreciation                                                48,814              31,244 
  Gain on sale of property                                    (1,864)                  - 
Changes in operating assets and liabilities:
  Accounts receivable                                        378,538              (4,496)
  Inventories                                               (889,934)           (167,517)
  Prepaid expenses                                            12,042              12,177 
  Income taxes recoverable                                     8,385              14,416 
  Lease receivable                                             3,068               2,599 
  Accounts payable                                           740,116             194,494 
  Payroll taxes                                              (22,638)             (8,466)
  Accrued compensation                                         4,961              10,604 
  Accrued local taxes                                         (5,239)             38,457 
  Income taxes payable                                             -               4,442 
                                                       --------------       -------------
Net cash flows from operating activities                     487,358             446,845 
                                                       --------------       -------------

CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale of property                                 2,900                   - 
Purchases of property                                       (101,978)            (46,163)
                                                       --------------       -------------
Net cash flows from investing activities                     (99,078)            (46,163)
                                                       --------------       -------------

CASH FLOWS FROM FINANCING ACTIVITIES:
Payment of dividends                                        (204,000)           (163,200)
                                                       --------------       -------------

INCREASE IN CASH AND CASH EQUIVALENTS                        184,280             237,482 

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD             763,524             796,001 
                                                       --------------       -------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD                  $947,804          $1,033,483 
                                                       --------------       -------------
                                                       --------------       -------------

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during period for:
  Income taxes                                              $126,586            $197,357 
                                                       --------------       -------------
                                                       --------------       -------------
</TABLE>









                                          7


<PAGE>

                                  UNIVERSAL MFG. CO.
                            NOTES TO FINANCIAL STATEMENTS
                            AS OF AND FOR THE NINE MONTHS
                                 ENDED APRIL 30, 1997
                                     (UNAUDITED)

1.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     NATURE OF OPERATIONS - The Company is engaged in the business of
     remanufacturing and selling on a wholesale basis remanufactured
     engines and other remanufactured automobile parts for Ford,
     Lincoln and Mercury automobiles and trucks.  The Company is a
     franchised remanufacturer for Ford Motor Company with a defined
     sales territory.  The Company purchases the majority of its new
     raw materials from Ford Motor Company.  Remanufactured engines
     for non-Ford vehicles are also marketed on a limited basis.
     The principal markets for the Company's products are automotive
     dealers and jobber supply houses.  The Company has no separate
     segments, major customers, foreign operations or export sales.

     USE OF ESTIMATES - In preparing financial statements in
     conformity with generally accepted accounting principles,
     management is required to make estimates and assumptions that
     affect the reported amounts of assets and liabilities and the
     disclosure of contingent assets and liabilities at the date of
     the financial statements and the reported amounts of revenues and
     expenses during the reporting period.  Actual results could differ
     from those estimates.

     INVENTORIES - Inventories are stated at the lower of cost (last-
     in first-out method) or market.

     INVESTMENTS - Short-term investments are considered as either
     trading securities or available for sale securities and,
     accordingly, are carried at fair value in the Company's financial
     statements.

     DEPRECIATION, MAINTENANCE, AND REPAIRS - Property is depreciated
     generally as follows:

     ASSETS               DEPRECIATION METHOD               LIVES
     ------               ------------ ------               -----

     Buildings            Straight-line and
                          declining balance             10 - 20 years

     Machinery and
     equipment            Declining-balance              7 - 10 years

     Furniture and
     fixtures             Declining-balance               5 - 7 years

     Trucks and
     automobiles          Declining-balance               3 - 5 years

     Maintenance and repairs are charged to operations as incurred.
     Renewals and betterments are capitalized and depreciated over
     their estimated useful service lives.  The applicable property
     accounts are relieved of the cost and related accumulated
     depreciation upon disposition.  Gains or losses are recognized
     at the time of disposal.

     REVENUE RECOGNITION - Sales and related cost of sales are
     recognized primarily upon shipment of products.

     CASH EQUIVALENTS - For the purposes of the Statements of Cash
     Flows, the Company considers all highly liquid instruments
     purchased with a maturity of three months or less to be cash
     equivalents.




                                          8


<PAGE>

                      NOTES TO FINANCIAL STATEMENTS - CONTINUED
                                     (UNAUDITED)




     FINANCIAL INSTRUMENTS - Cash and cash equivalents, accounts
     receivable and accounts payable are short term in nature and the
     values at which they are recorded are considered to be reasonable
     estimates of their fair values.

     EARNINGS PER SHARE - Earning per share have been computed on the
     weighted average number of shares outstanding (816,000 shares).

     COMPANY REPRESENTATION - In the opinion of the Company, the
     accompanying unaudited financial statements contain all
     adjustments (consisting of only normal recurring accruals)
     necessary to present fairly the financial position as of April 30,
     1997, and the results of operations and cash flows for the nine
     month and three month periods ended April 30, 1997 and 1996.  The
     results of operations for the periods ended April 30, 1997 and
     1996 are not necessarily indicative of the results to be expected
     for the full year.

     Certain information and footnote disclosures normally included in
     financial statements prepared in accordance with generally
     accepted accounting principles have been omitted.  The Company
     suggests that these condensed financial statements be read in
     conjunction with the financial statements and notes included in
     the Company's Form 10-KSB for the fiscal year ended July 31, 1996.

2.   CHANGES IN ACCOUNTING PRINCIPLES

     INVESTMENTS - During the year ended July 31, 1995 the Company
     adopted the provisions of Statement of Financial Accounting
     Standards (SFAS) No. 115, Accounting for Certain Investments in
     Debt and Equity Securities.  The adoption of SFAS No. 115 had no
     effect on the 1995 financial statements.

3.   LEASE RECEIVABLE

     On May 26, 1993, the Company entered into a lease agreement with
     another manufacturer to lease equipment at 8% interest for a
     sixty-month period.  The total minimum lease payments are $34,216
     and the unearned income is $16,985 at April 30, 1997.  These
     amounts are shown on a net basis for financial statement purposes.

4.   EPA PROJECT COSTS

     In February, 1991, the Company was served with a complaint from
     the United States Environmental Protection Agency (EPA) which
     contained eight counts of alleged violations of the Resource
     Conservation and Recovery Act of 1976 and the Hazardous Solid
     Waste Amendments of 1984.  The complaint alleges, among other
     things, that the Company has failed to adequately test and
     properly transport certain residue of hazardous wastes which it
     was treating at its facility.  The Company entered into a Consent
     Agreement and Consent Order with the EPA, dated May 6, 1994, which
     provides for settlement of this complaint.

     This settlement calls for payment of a civil penalty of $32,955,
     and for the completion of certain remedial projects, estimated to
     cost approximately $149,725.  Total costs paid as of April 30,
     1997 are $90,113.  The remaining amount of $59,612 has been
     recorded in the accompanying financial statements.






                                          9


<PAGE>

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                       AND RESULTS OF OPERATIONS

         Sales for the third quarter, fiscal year 1997 were 2% lower
         than for the third quarter of 1996.  Sales a year ago were
         assisted by some extremely cold temperatures, while weather
         was not as much of a factor this year.

         Sales for the nine months of 1997 were 9% higher than for
         the same period last year.  The sales increase was led by
         sales of remanufactured engine assemblies and electric fuel
         pumps.

         Earnings for the third quarter were lower than for the third
         quarter a year ago due to lower total sales and a sales mix
         of more lower margin product lines.

         Earnings for the nine months ended April 30, 1997 were
         7% higher than a year ago due to the increased sales volume.

         Inventories increased for the quarter ended April 30, 1997,
         compared to Fiscal year end 1996 by 24%.  This was due to
         increased participation by the Company in distribution of
         FQR (Ford Quality Renewal) engine and transmission assemblies
         for Ford Motor Company.

         Accounts payable increased by 29%, due to increased purchases
         of FQR assemblies.

PART II

ITEM 1.  LEGAL PROCEEDINGS:

         With respect to the Supplemental Environmental Project
         (the "SEP") being performed by the Company pursuant to the
         May 6, 1994 Consent Agreement with the United States
         Environmental Protection Agency ("EPA"), the Company has
         paid total costs of $90,113 for work performed.  No further
         direction has been received from the EPA regarding any testing
         or clean-up that may be required for contamination found in
         the large pit after the sludge was removed.  No estimate of
         these costs can be made at this time.  If the EPA determines
         that no further work is required under the SEP, the Company
         will owe a deferred penalty of approximately $32,955 under the
         terms of the Consent Agreement with the EPA.

         Please refer to the Part I, Item 3 of the Form 10-KSB report
         for the Company's fiscal year ended July 31, 1996 for further
         discussion of this matter.

ITEM 2.  CHANGES IN SECURITIES:                 NONE.
                                                -----

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES:       NONE.
                                                -----

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS:  NONE.
                                                               -----

ITEM 5.  OTHER INFORMATION:    NONE.
                               -----

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K:

         (a) Exhibits:      NONE.
                            -----

         (b) Reports on Form 8-K:
             The Company did not file any reports on Form 8-K during
             the quarter for which this report is filed.


                                          10


<PAGE>

SIGNATURES:

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.


                                  UNIVERSAL MFG. CO




Date 5-23-97    /s/ Gary L. Christiansen
     -------    ----------------------------------------------------------------
                Gary L. Christiansen, Vice President/Treasurer






Date 5-23-97    /s/ Donald D. Heupel
     -------    ----------------------------------------------------------------
                Donald D. Heupel, President and Chief Financial Officer
















                                          11