UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                   FORM 10-Q

(Mark One)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
      OF THE SECURITIES EXCHANGE ACT OF 1934

                 For the quarterly period ended March 31, 1997

                               OR

[   ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
      OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________________ to __________________

                         Commission file number 0-2977

                        General Magnaplate Corporation
            -----------------------------------------------------
           (Exact name of registrant as specified in its charter)

               New Jersey                                22-1641813
     -------------------------------                 ------------------
     (State or other jurisdiction of                    IRS Employer
     incorporation or organization)                  Identification No.

     1331 U.S. Route 1, Linden, New Jersey                     07036
     -------------------------------------                   ---------
     (Address of principal executive offices)                (Zip Code)

Registrant's telephone number, including area code: (908) 862-6200
                                                    --------------
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or 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 May 1, 1997:

Common Stock, No Par Value                                   2,465,897
--------------------------                               ------------------
         (Class)                                         (Number of Shares)

<PAGE>
                               INDEX OF DOCUMENTS 


PART I - FINANCIAL INFORMATION

ITEM 1 - FINANCIAL STATEMENTS
                  Accountants' Report
                  Balance Sheet - End of Current Quarter
                  Balance Sheet - End of Prior Fiscal Year
                  Statement of Income
                  Statement of Changes in Financial Position
                  Notes to Consolidated Financial Statements

ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
               POSITION AND RESULTS OF OPERATIONS

PART II - OTHER INFORMATION

ITEM 1 - LEGAL PROCEEDINGS - None

ITEM 4 -  Submission  of Matters to a Vote of  Security  Holders - None 
ITEM 5 - Other  Information  - Press  Release - Enclosed
ITEM 6 - Exhibits and Reports on Form 8-K - None
<PAGE>
MAURIELLO, FRANKLIN & LoBRACE
        A Professional Corporation
         Certified Public Accountants
                            45 Springfield Avenue, Springfield, New Jersey 07081
                                     Telephone (201) 379-5400 Fax (201) 379-3696



                           ACCOUNTANTS' REVIEW REPORT 

To The Board of Directors of
  General Magnaplate Corporation:

         We have reviewed the accompanying  balance sheet of General  Magnaplate
Corporation and  Wholly-Owned  Subsidiaries as of March 31, 1997 and the related
consolidated  statement of stockholders'  equity for the nine months ended March
31, 1997 and the related  consolidated  statements  of income and cash flows for
the nine months ended March 31, 1997 and 1996, in accordance  with Statements on
Standards for Accounting and Review Services issued by the American Institute of
Certified  Public  Accountants.  All  information  included  in these  financial
statements  is  the   representation   of   management  of  General   Magnaplate
Corporation.

         A review  consists  principally  of inquiries of Company  personnel and
analytical  procedures  applied to financial data. It is  substantially  less in
scope than an audit in accordance with generally  accepted  auditing  standards,
the  objective of which is the  expression  of opinion  regarding  the financial
statements taken as a whole.  Accordingly,  we do not express such an opinion on
the March 31, 1997 and 1996 statements.

         Based on our  review,  we are not aware of any  material  modifications
that should be made to the accompanying  financial  statements in order for them
to be in conformity with generally accepted accounting principles.

         Our review was made for the  purpose of  expressing  limited  assurance
that there are no material  modifications  that should be made to the  financial
statements  in  order  for  them to be in  conformity  with  generally  accepted
accounting principles.  The supplementary  information for the nine months ended
and three  months  ended  March 31, 1997 and 1996  included in the  accompanying
supplementary information is presented for supplementary analysis purposes. Such
information has been subjected to the inquiry and analytical  procedures applied
in the  review of the basic  financial  statements,  and we are not aware of any
material modifications that should be made thereto.

         The  balance  sheet for the year ended June 30, 1996 was audited by us,
and we  expressed  an  unqualified  opinion on it in our report  dated August 9,
1996. We have not  performed any auditing  procedures on the balance sheet since
August 9, 1996.

                                        /s/ Mauriello, Franklin & Lo Brace, P.C.
                                        ----------------------------------------
                                            Mauriello, Franklin & Lo Brace, P.C.

April 23, 1997
<PAGE>
<TABLE>
<CAPTION>
                         GENERAL MAGNAPLATE CORPORATION
                                       AND
                            WHOLLY-OWNED SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS





                                                     March 31,         June 30,
         ASSETS                                        1997              1996
         ------                                    -----------       -----------
<S>                                                <C>               <C>
Current assets:
  Cash and cash equivalents ................       $   884,790       $   680,570
  Marketable securities (Note 1) ...........         2,714,308         4,192,421
  Accounts receivable--trade, net of
    allowance for doubtful accounts of
    $132,000 (June 30, 1996-$137,000) ......         1,459,735         1,254,845
  Inventories (Note 1) .....................           272,536           273,073
  Prepaid expenses .........................           134,389           177,321
  Other current assets .....................           160,252           158,287
                                                   -----------       -----------

      Total current assets .................       $ 5,626,010       $ 6,736,517

Property, plant, and equipment, at
  cost, net of accumulated
  depreciation (Notes 1 and 2) .............         5,263,666         5,432,330

Cash surrender value of officers' life
  insurance, net ...........................           664,162           664,162

Other assets (Note 3) ......................         1,153,490           500,707
                                                   -----------       -----------

    Total assets ...........................       $12,707,328       $13,333,716
                                                   ===========       ===========


                 SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
                         GENERAL MAGNAPLATE CORPORATION
                                       AND
                            WHOLLY-OWNED SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS



                                                    March 31,         June 30,
LIABILITIES AND STOCKHOLDERS' EQUITY                  1997              1996
------------------------------------             ------------      ------------
<S>                                              <C>               <C>
Current liabilities:
  Accounts payable .........................     $    245,595      $    437,113
  Accrued liabilities (Note 5) .............          338,880           559,903
  Corporate income taxes payable ...........          153,513            70,560
                                                 ------------      ------------

    Total current liabilities ..............     $    737,988      $  1,067,576
                                                 ------------      ------------

Long-term liabilities:
  Rent security deposit ....................     $      9,193      $      7,877
  Accrued deferred compensation (Note 6) ...        1,093,010           977,831
                                                 ------------      ------------

    Total long-term liabilities ............     $  1,102,203      $    985,708
                                                 ------------      ------------

    Total liabilities ......................     $  1,840,191      $  2,053,284
                                                 ------------      ------------

Contingencies (Note 7)

Stockholders' equity:
  Common stock--no par value
    Authorized--5,000,000 shares
    Issued and outstanding--2,471,797 shares
    (June 30, 1996 - 2,634,797 shares) .....     $    223,180      $    223,180
  Retained earnings ........................       10,782,291        11,178,589
  Foreign currency translation adjustment
    (Note 1) ...............................         (138,334)         (121,337)
                                                 ------------      ------------

    Total stockholders' equity .............     $ 10,867,137      $ 11,280,432
                                                 ------------      ------------

    Total liabilities and
      stockholders' equity .................     $ 12,707,328      $ 13,333,716
                                                 ============      ============



                 SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
                         GENERAL MAGNAPLATE CORPORATION
                                       AND
                            WHOLLY-OWNED SUBSIDIARIES

                 CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
                        NINE MONTHS ENDED MARCH 31, 1997




                                                                      Foreign
                                                                     Currency
                                     Common         Retained        Translation
                                      Stock         Earnings         Adjustment
                                      -----         --------         ----------
<S>                                <C>           <C>               <C>
Balance,
  July 1, 1996 ...............     $ 223,180     $ 11,178,589      $   (121,337)

Add--net income ..............           -0-        1,035,449               -0-

Add--foreign currency
 translation adjustment ......           -0-              -0-           (16,997)

Less--dividends paid .........           -0-         (335,684)              -0-

Less--purchase and retirement
  of 163,000 treasury shares .           -0-       (1,096,063)              -0-
                                   ---------     ------------      ------------

Balance, March 31, 1997 ......     $ 223,180     $ 10,782,291      $   (138,334)
                                   =========     ============      ============


                 SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

</TABLE>
<PAGE>
<TABLE>
<CAPTION>
                               GENERAL MAGNAPLATE CORPORATION
                                             AND
                                  WHOLLY-OWNED SUBSIDIARIES

                              CONSOLIDATED STATEMENTS OF INCOME




                                         Nine Months Ended           Three Months Ended
                                            March   31,                  March   31,
                                    -------------------------     -------------------------
                                        1997           1996           1997           1996
                                    ----------     ----------     ----------     ----------
<S>                                 <C>            <C>            <C>            <C>
Gross revenue:
  Sales .......................     $7,712,118     $7,470,665     $2,737,640     $2,623,513
  Royalty income ..............        232,276        203,999         67,283         67,587
  Investment and other
    income, net ...............        324,528        364,886         73,762         28,174
                                    ----------     ----------     ----------     ----------
                                    $8,268,922     $8,039,550     $2,878,685     $2,719,274
                                    ----------     ----------     ----------     ----------

Costs and expenses:
  Cost of sales ...............     $3,274,116     $3,025,623     $1,189,661     $1,061,534
  Selling and administration ..      2,932,954      2,837,470        981,174        881,592
  Depreciation and amortization        437,069        448,236        149,568        147,560
  Interest ....................            234          5,414           --             --
                                    ----------     ----------     ----------     ----------
                                    $6,644,373     $6,316,743     $2,320,403     $2,090,686
                                    ----------     ----------     ----------     ----------

Income before corporate
  income taxes ................     $1,624,549     $1,722,807     $  558,282     $  628,588

Corporate income taxes
  (Notes 1 and 4) .............        589,100        628,800        211,600        229,500
                                    ----------     ----------     ----------     ----------

Net income ....................     $1,035,449     $1,094,007     $  346,682     $  399,088
                                    ==========     ==========     ==========     ==========

Earnings per share
  (Note 1) ....................     $      .40     $      .40     $      .14     $      .15
                                    ==========     ==========     ==========     ==========

Weighted average shares
  outstanding .................      2,570,650      2,742,767      2,504,244      2,704,344
                                    ==========     ==========     ==========     ==========




                       SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
                                 GENERAL MAGNAPLATE CORPORATION
                                              AND
                                   WHOLLY-OWNED SUBSIDIARIES

                             CONSOLIDATED STATEMENTS OF CASH FLOWS
                           NINE MONTHS ENDED MARCH 31, 1997 AND 1996

                                                                      1997             1996
                                                                  -----------      -----------
<S>                                                               <C>              <C>
 CASH FLOWS FROM OPERATING ACTIVITIES:
  Net income                                                      $ 1,035,449      $ 1,094,007
                                                                  -----------      -----------
  Adjustments to reconcile net income to net
    cash provided by operating activities:
      Depreciation and amortization .........................     $   437,069      $   448,236
      Deferred taxes ........................................         (37,600)         (58,500)
      Accrued deferred compensation .........................         115,179          129,782
      Foreign currency translation adjustment ...............         (16,997)             650
      Provision for doubtful accounts .......................          28,336           53,000
      Increase  (decrease) in cash  resulting from changes in
       current assets and  liabilities:
         Marketable securities ..............................       1,478,113          489,243
         Accounts receivable ................................        (233,226)        (117,772)
         Other current assets ...............................          65,180          187,008
         Accounts payable and accrued liabilities ...........        (412,541)        (136,229)
         Corporate income taxes payable .....................          82,953         (125,187)
         Rent security deposit ..............................           1,316             --
                                                                  -----------      -----------
         Total adjustments ..................................     $ 1,507,782      $   870,231
                                                                  -----------      -----------

    Net cash provided by operating activities ...............     $ 2,543,231      $ 1,964,238
                                                                  -----------      -----------

CASH FLOWS FROM INVESTING ACTIVITIES:
  Additions to property, plant,  and equipment ..............     $  (264,975)     $  (256,106)
  Additions to patent costs and other assets ................         (93,963)          (3,155)
  Note receivable - officer .................................        (550,000)             -0-
  Installment collections - note receivable .................           1,674              -0-
                                                                  -----------      -----------
    Net cash used in investing activities ...................     $  (907,264)     $  (259,261)
                                                                  -----------      -----------
<PAGE>
<CAPTION>
                                 GENERAL MAGNAPLATE CORPORATION
                                              AND
                                   WHOLLY-OWNED SUBSIDIARIES

                             CONSOLIDATED STATEMENTS OF CASH FLOWS
                           NINE MONTHS ENDED MARCH 31, 1997 AND 1996
                                          (continued)

                                                                      1997             1996
                                                                  -----------      -----------
<S>                                                               <C>              <C>
CASH FLOWS FROM FINANCING ACTIVITIES:
  Purchase and retirement of treasury stock .................     $(1,096,063)     $  (678,256)
  Dividends paid ............................................        (335,684)        (273,404)
  Reduction in long-term debt ...............................             -0-         (177,544)
                                                                  -----------      -----------

    Net cash used in financing activities ...................     $(1,431,747)     $(1,129,204)
                                                                  -----------      -----------

Increase (decrease) in cash and cash equivalents ............     $   204,220      $   575,773
Cash and cash equivalents, beginning of period ..............         680,570          369,276
                                                                  -----------      -----------
Cash and cash equivalents, end of period ....................     $   884,790      $   945,049
                                                                  ===========      ===========

Supplementary cash flow data:
  Income taxes paid .........................................     $   543,747      $   814,597
  Interest paid .............................................     $       234      $     5,414


                        SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

</TABLE>
<PAGE>
                         GENERAL MAGNAPLATE CORPORATION
                                       AND
                            WHOLLY-OWNED SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 1--Summary of Significant Accounting Policies

         Principles of Consolidation

                  The consolidated  financial statements include the accounts of
         General  Magnaplate  Corporation  and  its  wholly-owned  subsidiaries;
         accordingly  all  intercompany  transactions  and  balances  have  been
         eliminated in consolidation.

         Nature of Business

                  The  Company  is  in  one  line  of   business.   It  provides
         synergistic  coatings  and other  related  services  to its  customers'
         products from five plants located in the United States and Canada.

         Marketable Securities

                  All marketable  securities are considered  trading  securities
         and are valued at fair market  value in  accordance  with SFAS No. 115.
         Realized and unrealized gains and losses are reported in current period
         income. Market value exceeded cost by $12,542 at March 31, 1997.

         Inventories

                  Inventories  consist  principally  of industrial  supplies and
         plating  solutions which are valued at the lower of FIFO cost or market
         and are included in Cost of Sales.

         Depreciation and Amortization

                  Property,   plant  and   equipment  are  stated  at  cost  and
         depreciation  is provided  principally  on a straight  line basis using
         estimated service lives of 3-5 years for transportation equipment, 5-10
         years for factory machinery and office  equipment,  and 10-39 years for
         buildings  and  building  improvements.  Expenditures  for renewals and
         betterments are capitalized.  Items of identifiable  property which are
         sold,  retired,  or  otherwise  disposed of are removed  from the asset
         accounts, and any gains or losses thereon are reflected in income.

                  Patents and  trademarks are amortized on a straight line basis
         over periods not exceeding 17 years.
<PAGE>
                         GENERAL MAGNAPLATE CORPORATION
                                       AND
                            WHOLLY-OWNED SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



         Note 1--Summary of Significant Accounting Policies (Continued)


         Corporate Income Taxes

                  Taxes are  provided  based on income  reported  for  financial
         statement  purposes,  including  deferred  taxes which are  principally
         provided  due  to  temporary  differences  between  financial  and  tax
         reporting of certain revenue and expense items.

         Company Earnings Per Share

                  Earnings per share of common stock have been computed based on
         the weighted average number of shares outstanding during the period.

         Statement of Cash Flows

                  For  purposes  of the  statement  of cash  flows,  the Company
         considers all highly liquid debt instruments  purchased with a maturity
         of three months or less to be cash equivalents.

         Foreign Currency Translation Adjustment

                  Assets and  liabilities of the subsidiary  operating in Canada
         are translated  into U.S.  dollars using the exchange rate in effect at
         the balance sheet date.  Results of operations are translated using the
         average exchange rate prevailing  throughout the period. The effects of
         exchange rate  fluctuations on translating  foreign currency assets and
         liabilities  into U.S.  dollars  are  included  as part of the  Foreign
         Currency  Translation  Adjustment  component of  shareholders'  equity,
         while gains and losses resulting from foreign currency transactions are
         generally included in income.

         Use of Estimates

                  The  preparation  of financial  statements in conformity  with
         generally accepted  accounting  principles  requires management to make
         estimates and  assumptions  that affect the reported  amounts of assets
         and liabilities and disclosure of contingent  assets and liabilities at
         the date of financial  statements and the reported  amounts of revenues
         and expenses during the reporting  period.  Actual results could differ
         from those estimates.
<PAGE>
                         GENERAL MAGNAPLATE CORPORATION
                                       AND
                            WHOLLY-OWNED SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


         Note 2--Property, Plant and Equipment

         Property, plant and equipment are as follows:
<TABLE>
<CAPTION>
                                                  March  31,           June 30,
                                                     1997                1996
                                                 -----------         -----------
<S>                                              <C>                 <C>
Land ...................................         $   805,350         $   805,350
Buildings ..............................           3,366,208           3,366,208
Building improvements ..................           3,428,765           3,393,127
Factory machinery ......................           4,641,207           4,465,319
Office equipment .......................             904,719             865,614
Transportation equipment ...............             252,150             264,026
                                                 -----------         -----------

Total ..................................         $13,398,399         $13,159,644
Less--accumulated depreciation .........           8,134,733           7,727,314
                                                 -----------         -----------

Net ....................................         $ 5,263,666         $ 5,432,330
                                                 ===========         ===========
</TABLE>
Note 3--Other Assets

                  Other assets are as follows:
<TABLE>
<CAPTION>
                                                                  March 31,       June 30,
                                                                    1997           1996
                                                                ----------     ----------
<S>                                                             <C>            <C>

Deferred income taxes .....................................     $  199,034     $  174,676
Note receivable-related party .............................        235,000        235,000
Deferred compensation contracts ...........................         94,011         54,011
Patents and trademarks, at cost, net of
    accumulated  amortization .............................         87,553         37,020
Note receivable-officer (less current maturity)............        537,892           --
                                                                ----------     ----------

                                                                $1,153,490     $  500,707
                                                                ==========     ==========
</TABLE>
<PAGE>
                         GENERAL MAGNAPLATE CORPORATION
                                       AND
                            WHOLLY-OWNED SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

         Note 4--Corporate Income Taxes

              Components of corporate income taxes are as follows:
<TABLE>
<CAPTION>
                          Nine Months Ended                Three Months Ended
                      -------------------------       -------------------------
                               March 31,                       March 31,
                      -------------------------       -------------------------
                         1997            1996            1997            1996
                      ---------       ---------       ---------       ---------
<S>                   <C>             <C>             <C>             <C>
Current:
   Federal .....      $ 533,000       $ 582,800       $ 184,300       $ 197,200
   State .......         93,700         104,500          39,600          57,600
   Foreign .....           --              --              --
                      ---------       ---------       ---------       ---------
                      $ 626,700       $687,300        $ 223,900       $ 254,800
                      ---------       ---------       ---------       ---------
Deferred:
  Federal ......       $(29,100)      $ (45,300)      $  (9,500)      $ (19,900)
  State ........         (8,500)        (13,200)         (2,800)         (5,400)
  Foreign ......           --              --              --
                      ---------       ---------       ---------       ---------
                      $ (37,600)      $ (58,500)      $ (12,300)      $ (25,300)
                      ---------       ---------       ---------       ---------

Total ..........      $ 589,100       $ 628,800       $ 211,600       $ 229,500
                      =========       =========       =========       =========
</TABLE>
<PAGE>
                         GENERAL MAGNAPLATE CORPORATION
                                       AND
                            WHOLLY-OWNED SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

         Note 4--Corporate Income Taxes (Continued)

              Components of corporate income taxes are as follows:

         A  reconciliation  of the provision for corporate income taxes compared
with amounts computed at the US statutory tax rate is as follows:
<TABLE>
<CAPTION>
                                                       Nine Months Ended             Three Months Ended
                                                    --------------------------     ----------------------
                                                            March 31,                      March 31,
                                                    --------------------------     ----------------------
                                                      1997              1996         1997          1996
                                                    --------          --------     ---------     --------
<S>                                                 <C>               <C>          <C>           <C>
         Based on U.S. statutory
          federal tax rate                          $552,347          $585,754     $189,816      $213,754
         Increase (decrease) in
          taxes resulting from:
           State taxes, net of
            federal tax benefit                       56,232            60,258       24,288        34,458
           Non-deductible (reportable)
            expenses (income)                        (19,479)          (17,212)      (2,504)      (18,712)
                                                    --------          --------     ---------     --------

            Total                                   $589,100          $628,800     $211,600      $229,500
                                                    ========          ========     ========      ========

         Effective tax rate                             36.3%             36.5%        37.9%         36.5%
</TABLE>
         The Canadian  subsidiary has available  unused tax benefits in the form
of operating loss  carryforwards  of $168,000 to reduce future Canadian  taxable
income. These carryforwards principally expire in 1999. Due to their uncertainty
of  realization,  these tax benefits have been reflected net of a 100% valuation
allowance.
<PAGE>
                         GENERAL MAGNAPLATE CORPORATION
                                       AND
                            WHOLLY-OWNED SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



Note 5--Accrued Liabilities

         Accrued liabilities are as follows:
<TABLE>
<CAPTION>
                                                       March 31,       June 30,
                                                         1997             1996
                                                       --------         --------
<S>                                                    <C>              <C>

Compensation .................................         $245,199         $309,695
Payroll, sales, and property taxes ...........           72,376           75,775
401-k plan contribution ......................           10,287           27,176
Environmental and other costs ................           11,018          147,257
                                                       --------         --------

                                                       $338,880         $559,903
                                                       ========         ========
</TABLE>

Note 6--Employee Benefits

         The Company  maintains a 401(k) savings plan which covers all full time
U.S.   employees.   The  Company  matches  50%  of  voluntary  pre-tax  employee
participant  contributions  up  to 4%  of  compensation  as  well  as  providing
discretionary  contributions  based on compensation for all employees.  Employer
discretionary  contributions,  which are forfeited  due to employee  termination
prior to the full seven year vesting period,  revert back to the Company.  Total
expense under the plan was $30,124 in 1997 and $16,349 in 1996.

         Pursuant to employment  contracts and letter  agreements  with officers
and key employees,  the Company maintains  non-qualified  incentive compensation
plans which are based on the  realization of pre-tax income and royalty  income.
Total expense under these plans was $370,770 in 1997 and $375,300 in 1996.

         The Company is obligated to provide a non-qualified  retirement pension
to its chief executive  officer.  Such obligation  provides a monthly benefit of
$7,100 and is payable for a period of fifteen  years to the  officer,  or to his
wife in the event of his death.  The Company is accruing the obligation over the
active term of  employment  of the  officer.  The Company is also  accruing  and
funding deferred compensation  contracts with two other officers based on 10% of
annual compensation. Total expense under these three obligations was $112,505 in
1997 and $129,783 in 1996.
<PAGE>
                         GENERAL MAGNAPLATE CORPORATION
                                       AND
                            WHOLLY-OWNED SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 7--Contingencies and Risks

         Litigation

                  In April, 1991, a claim was served on the Canadian subsidiary,
         General Magnaplate Canada,  Ltd., by Dynasurf  International,  Inc. for
         $170,000  representing the unpaid contract liability for the net assets
         acquired  by  the  Canadian  subsidiary  from  the  sellers,   Carrigan
         Industries, Ltd. and Dynasurf International, Inc. on January 2, 1990.

                  The Subsidiary  filed a  counterclaim  for  environmental  and
         other  costs  incurred  which  resulted  from the seller not  resolving
         certain  environmental  issues  warranted  in the contract of purchase.
         Further,  a shareholder  of Dynasurf  International,  Inc. also filed a
         claim for breach of oral contract of employment  for $119,000 which the
         Company denied in their related statement of defense.

                  The  Company  reached  an  out of  court  agreement  with  the
         plaintiffs in September,  1996 wherein the plaintiffs were collectively
         paid  the sum of  $65,000  in full  settlement  of  their  claim.  Such
         settlement  did not have an adverse  effect on the Company's  financial
         statements.

         Concentrations of Credit Risk

                  The  Company's  financial  instruments  that  are  exposed  to
         concentrations of credit risk consist primarily of its cash, marketable
         securities and trade receivables.

                  The  Company's   cash  and   marketable   securities   are  in
         high-quality  securities  placed with a wide array of institutions with
         high credit and investment  ratings.  This investment policy limits the
         Company's exposure to concentrations of credit risk.

                  The  trade  receivable  balances,   reflecting  the  Company's
         diversified  sources of revenue,  are dispersed  across many  different
         geographic  areas. As a consequence,  concentrations of credit risk are
         limited.  The Company routinely  assesses the financial strength of its
         customers  and  generally  does not require  collateral  to support its
         credit sales.
<PAGE>
                         GENERAL MAGNAPLATE CORPORATION
                                       AND
                            WHOLLY-OWNED SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 8--Related Party Transactions

                  The   Company   engaged  in  the   following   related   party
         transactions:
<TABLE>
<CAPTION>
                                                                                            Nine Months Ended
                                                                                                 March  31,
                                                                                        -------------------------
                                                                                          1997              1996
                                                                                          ----              ----
<S>                                                                                     <C>               <C>
         Was charged computer consulting services
         by an outside director of the Company;                                         $29,193           $25,353

         Accrued  interest income on an installment  note receivable of $235,000
         secured  by a deed of trust on the Texas  real  estate.  The note bears
         interest  of 6.83%  per annum  collectible  annually  for three  years.
         Thereafter  the note shall be collected  in (5) equal annual  principal
         installments  of $47,000  plus  interest of 6.83% per annum  commencing
         July 1, 1999 with the final collection due July 1, 2003;                       $12,038           $12,038

         Charged  interest  income on a bridge note  receivable of $550,000 from
         its chief  executive  officer on December 16,  1996.  The note is to be
         repaid in (35) equal  installments of $3,814 which includes interest of
         5.6% per annum  commencing  February  1,  1997  with the final  balloon
         payment of $516,915 due
         December 16, 1999.                                                             $ 8,924           $   -0-
</TABLE>

Note 9--Fair Value of Financial Instruments

         Cash and Cash Equivalents,  Accounts Receivable,  Accounts Payable, and
         Accrued  Liabilities--The   carrying  amount  approximates  fair  value
         because of the short maturity of these instruments.

         Marketable  Securities--The  carrying  amount  approximates  fair value
         because such securities are valued based on market quotes.

         Notes Receivable -  Long-term--The  carrying amount  approximates  fair
         value  because of similar  rates on issues  offered to the  Corporation
         under some or similar provisions.

         Accrued Deferred  Compensation--The  carrying amount  approximates fair
         value  because such  liability is being valued based on current  market
         values.
<PAGE>
      Item 2A - Management's Discussion and Analysis of Financial Position: 

Financial Condition
Liquidity and Capital Resources
Nine-Months ended March 1997

         Cash and cash equivalents  increased to $884,790 at March 31, 1997 from
$680,570 at June 30, 1996.  For the period,  $2,543,231 net cash was provided by
the  operating  activities,  $907,264  was used  for  investing  activities  and
$1,431,747 was used for financing  activities.  During the past nine months, the
registrant's investment activities were primarily comprised of $264,975 used for
additions to property,  plant and equipment $93,963 used for additions to patent
costs and $550,000 was used for a note receivable.  The $1,431,747 for financing
activities  was used for the payment of dividends of $335,684 and $1,096,063 for
the purchase and retirement of treasury stock.

         Working capital of $4,888,022 decreased $780,919 or 16% during the nine
months and the working  capital  ratio  increased to 7.62 to 1 from 6.31 to 1 at
June 30, 1996.

         Stockholders' equity per share March 31, 1997 increased 3% to $4.40 per
share  compared with $4.28 per share June 30, 1996. As previously  authorized by
the Board, 163,000 shares of GMCC stock were purchased at the cost of $1,096,062
(an average price per share of $6.72) which was retired and canceled  during the
current nine month period.

         Management  believes  that  internal  cash  flow  and/or  incomes  from
marketable  securities  are  expected  to be  sufficient  to provide the capital
resources  necessary to support future  operating needs, and does not anticipate
any material  expenditures  that will have a  significant  impact on future cash
flows.


     Item 2B - Management's Discussion and Analysis of Results of Operations
            Quarter --- March 31, 1997 compared with March 31, 1996:

         Sales increased this quarter,  as reflected in the current period sales
of $2,737,640,  by $114,127 or 4% from the same quarter last year.  Sales at all
locations increased this quarter with the exception of our California  facility,
whose  sales are down  slightly.  Management  feels that sales will  continue to
increase  thru the  remainder  of the year as a result of  increases in customer
contracts,   and   volume   and   a   larger   sales   force.   Our   Web   site
(http://www.magnaplate.com) continues to be met with tremendous response and has
also generated more sales.  The  additional  space at our Wisconsin  facility is
almost 100% operational at this time.

         Although no increase is  reflected  in royalty  income for the quarter,
($67,283 vs. $ 67,587) this is primarily due to a timing difference. Only minium
royalties  were  accrued  this  quarter,  since  reports  from our  licensees of
additional  royalties  due had not been  received at the time the third  quarter
financials  were  prepared.  Additional  royalties  due will be  reported in the
fourth quarter. The international  advertising  continues to be very successful.
Senior  management  attended  a  European  sales  meeting  hosted  by our  Dutch
licensee, Mifa. In the opinion of management the meeting was very successful and
expect  positive  results in the future.  Management is  investigating  licensee
candidates in Italy. The first installment of $50,000 was paid by Black & Decker
<PAGE>
in accordance with the terms of the contract  regarding the exclusive  trademark
agreement  allowing  them to use our  MAGNAGLIDE  mark on their OSD steam irons.
This payment will be reflected as royalty income during the fourth quarter.  The
$45,588 increase in investment and other income is directly  associated with the
high yield,  fixed income  investments  in our portfolio  which was not severely
affected  by the  poor  performance  of the  market  at the end of the  quarter.
Management believes the investment  portfolio to be sound,  diversified and less
susceptible to market fluctuations while providing dividend and interest income.

         Reflecting the above, gross revenue for the latest quarter of this year
of $2,878,685 increased $159,411 or 6% from the same quarter last year.

         Total costs and  expenses  were  $2,320,403  in the third  quarter,  an
increase  of  $229,717  or 11% from the same  quarter of last year.  The primary
increase to expenses has been in raw materials and production  supplies.  Recent
extensive  chemical  purchases were made during the third quarter in preparation
for large  jobs which  were  started  in the early  part of the fourth  quarter.
Management will continue to monitor spending.

         Income  before  corporate  income  taxes was  $558,282  for the current
quarter,  a decrease  of $70,306 or 11% from the  $628,588  achieved in the same
quarter last year.  Corporate  income taxes and the  effective  tax rate in this
year's  third  quarter  were  $211,600  and 37.9%  respectively,  compared  with
$229,500 and 36.5% in the third quarter of last year.

         As a result of the above,  net income in the third quarter of this year
of $346,682 dropped $52,406 or 13% from the same quarter last year.

         Earnings  per share were $.14  compared  to $.15 in last  year's  third
quarter.  During the current three month period 49,000 shares of treasury  stock
were retired and canceled,  resulting in weighted average shares  outstanding of
2,504,244 compared to 2,704,344 for the same period last year.


        Nine Months ------- March 31, 1997 compared with March 31, 1996:

         Gross revenue for this year's first nine months of $8,268,922 increased
$229,372 or 3% from last year.

         Total  costs and  expenses  for the  current  nine  month  period  were
$6,644,373,  an increase of $327,630 or 5% from last year.  As a  percentage  of
gross  revenue,  total costs and  expenses  in 1997 were 80%  compared to 79% in
1996.  Cost of Sales as a percentage of gross revenue for the latest nine months
increased to 39% from 38% in the same period of last year.

Selling and administration remained at 35% of gross revenue and depreciation and
amortization decreased to 5% of gross revenue compared to 6% last year.

         As a result of the above,  income before corporate income taxes for the
first nine months of this year was  $1,624,549,  a decline of $98,258 or 6% from
last year.

         Corporate  income taxes in this year's first nine months were $589,100,
compared  with  $628,800 for the same period last year, a decrease of $39,700 or
7%. As  detailed in Note 5, this year's  effective  tax rate was 36.3%  compared
with 36.5% in 1996.
<PAGE>
         As a result  of the  above,  net  income  of  $1,035,449  this year was
$58,558 or 6% less than the  $1,094,007  achieved last year.  Earnings per share
remain at $.40 for this period.  During the nine month period  163,000 shares of
treasury  stock  were  retired  and  canceled   resulting  in  weighted   shares
outstanding of 2,570,650 compared with 2,742,767 in 1996.

         As detailed in Note 7 to the  consolidated  financial  statements,  the
previous legal matters have been resolved. No new legal matters are expected.

         As discussed above preliminary  investigations into potential licensees
in Italy are being conducted.

         General  Magnaplate  was  honored by OSHA as a merit  worksite in their
Voluntary Protection Program. This is a pilot program for smaller companies with
outstanding  safety records combined with employee and management  commitment to
strict safety standards.

         No other  significant  financial  matters are expected in future months
which will have an adverse impact on earnings.
<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.


                                              GENERAL MAGNAPLATE CORPORATION
                                              ------------------------------
                                                      (Registrant)

DATE        May 14, 1997
     ---------------------------  


         /s/Candida C. Aversenti
         ----------------------- 
            Candida C. Aversenti
                President



DATE       May 14, 1997
     --------------------------- 

           /s/Susan E. Neri
           --------------------- 
             Susan E. Neri
         Chief Accounting Officer
<PAGE>
                           [GRAPHIC -- COMPANY LOGO]

                                 MAGNAPLATE NEWS

1331 U.S. Route #1
Linden, New Jersey 07036
Telephone: 908-862-6200
Fax: 908-862-6110

FOR IMMEDIATE RELEASE

Linden, New Jersey     May 7, 1997

NASDAQ SYMBOL GMCC

                     GENERAL MAGNAPLATE CORPORATION (GMCC)
               Nine Month Report To Shareholders -- March 31, 1997


       Condensed Statement of Income - Nine Months Ending March 31, 1997
       ------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                      1997               1996
                                                   ----------         ----------
<S>                                                <C>                <C>       
Gross Revenue ............................         $8,268,922         $8,039,550
Income Before Taxes ......................          1,624,549          1,722,807  
Net Income ...............................          1,035,449          1,094,007
Earnings Per Share .......................              $0.40              $0.40

Avg. Shares Outstanding ..................          2,570,650          2,742,767

</TABLE>


                            ***********************


      Condensed Statement of Income - Three Months Ending March 31, 1997
                      
<TABLE>
<CAPTION>
                                                      1997               1996
                                                   ----------         ----------
<S>                                                <C>                <C>       
Gross Revenue ............................         $2,878,685         $2,719,274
Income Before Taxes ......................            558,282            628,588
Net Income ...............................            346,682            399,088
Earnings Per Share .......................              $0.14              $0.15

Avg. Shares Outstanding ..................          2,504,244          2,704,344
</TABLE>