SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                    FORM 10-Q

/X/ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities  Exchange
    Act of 1934

For the quarterly period ending          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:                       1-10104

                              United Capital Corp.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

          Delaware                               04-2294493
(State or other jurisdiction of       (I.R.S. Employer Identification No.)
 incorporation or organization)

       9 Park Place, Great Neck, New York                       11021
--------------------------------------------------------------------------------
    (Address of principal executive offices)                  (Zip Code)

                                  516-466-6464
--------------------------------------------------------------------------------
              (Registrant's telephone number, including area code)

                                       N/A
--------------------------------------------------------------------------------
              (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 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.
                          [X] Yes [ ] No

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


            Common stock, $.10 par value 5,280,723 shares outstanding
                               as of May 9, 1997.

                                  Page 1 of 16
<PAGE>
                      UNITED CAPITAL CORP. AND SUBSIDIARIES


                                      INDEX

                          PART I FINANCIAL INFORMATION
                                                                         PAGE
                                                                         ----
ITEM 1.           FINANCIAL STATEMENTS

                  Consolidated Balance Sheets as
                  of  March 31, 1997  and December 31, 1996                3

                  Consolidated Statements of  Income for
                  the Three Months Ended March 31, 1997 and 1996           4

                  Consolidated Statements of Cash Flows for
                  the Three Months Ended March 31, 1997 and 1996         5 - 6

                  Notes to Consolidated Financial Statements             7 - 10

ITEM 2.           MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS         10 - 15

                            PART II OTHER INFORMATION


ITEM 1.           LEGAL PROCEEDINGS                                       15

ITEM 6.           EXHIBITS AND REPORTS ON FORM 8-K                        16

SIGNATURES                                                                16

                                  Page 2 of 16
<PAGE>
                      UNITED CAPITAL CORP. AND SUBSIDIARIES

     CONSOLIDATED BALANCE SHEETS AS OF MARCH 31, 1997 AND DECEMBER 31, 1996
                                   (UNAUDITED)
<TABLE>
<CAPTION>
                           ASSETS                                                       1997                 1996
                           ------                                                       ----                 ----
<S>                                                                                 <C>                  <C>
CURRENT ASSETS:
     Cash and cash equivalents                                                      $  3,836,176         $  3,177,878
     Marketable securities                                                               302,973              313,294
     Notes and accounts receivable, net                                               22,441,180           22,443,743
     Inventories                                                                       7,349,196            7,853,229
     Prepaid expenses and other current assets                                           709,070              801,639
     Deferred income taxes                                                             1,835,277            1,831,768
                                                                                    ------------         ------------

              Total current assets                                                    36,473,872           36,421,551
                                                                                    ------------         ------------


PROPERTY, PLANT AND EQUIPMENT, net                                                     7,963,927            7,694,438




REAL PROPERTY HELD FOR RENTAL, net                                                    59,156,020           63,842,891


NONCURRENT NOTES RECEIVABLE                                                            5,910,863            5,931,744


OTHER ASSETS                                                                          11,359,860            5,912,647



DEFERRED INCOME TAXES                                                                  2,160,911            2,017,247
                                                                                    ------------         ------------


                Total assets                                                        $123,025,453         $121,820,518
                                                                                    ============         ============


LIABILITIES AND STOCKHOLDERS' EQUITY                                                    1997                 1996
------------------------------------                                                    ----                 ----

CURRENT LIABILITIES:
      Current maturities of long-term debt                                          $  7,340,015         $  7,711,408
      Current portion of borrowings under revolving credit facilities                 12,240,000           10,031,000
      Accounts payable and accrued liabilities                                        15,910,572           17,286,927
      Income taxes payable                                                             8,481,704            7,212,520
                                                                                    ------------         ------------

                   Total current liabilities                                          43,972,291           42,241,855
                                                                                    ------------         ------------

LONG-TERM LIABILITIES:
      Borrowings under revolving credit facilities                                     8,880,000            9,789,000
      Long-term debt                                                                  30,110,941           31,670,258
      Other long-term liabilities                                                      8,516,357            8,544,581
                                                                                    ------------         ------------

                   Total liabilities                                                  91,479,589           92,245,694
                                                                                    ------------         ------------

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY:
      Common stock                                                                       527,972              534,612
      Additional paid-in capital                                                       6,765,334            7,415,664
      Retained earnings                                                               24,150,584           21,515,762
      Net unrealized gain on marketable securities, net of  tax                          101,974              108,786
                                                                                    ------------         ------------

                   Total stockholders' equity                                         31,545,864           29,574,824
                                                                                    ------------         ------------


                   Total liabilities and stockholders' equity                       $123,025,453         $121,820,518
                                                                                    ============         ============
</TABLE>
THE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS ARE AN INTEGRAL PART
                            OF THESE BALANCE SHEETS.

                                  Page 3 of 16
<PAGE>
                      UNITED CAPITAL CORP. AND SUBSIDIARIES
                        CONSOLIDATED STATEMENTS OF INCOME
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                           Three Months Ended
                                                                      March 31, 1997  March 31, 1996
                                                                       ------------   ------------
<S>                                                                    <C>            <C>
REVENUES:
      Net sales                                                        $ 14,779,980   $ 15,644,353
      Rental revenues from real estate operations                         5,625,668      5,917,448
                                                                       ------------   ------------

      Total revenues                                                     20,405,648     21,561,801
                                                                       ------------   ------------

COSTS AND EXPENSES:
      Costs of sales                                                     10,861,224     12,023,279
      Real estate operations -
          Mortgage interest expense                                         811,290      1,072,656
          Depreciation expense                                            1,476,775      1,638,725
          Other operating expenses                                        1,559,131      1,988,551
      General and administrative expenses                                 2,207,810      2,083,117
      Selling expenses                                                    1,478,217      1,575,466
                                                                       ------------   ------------

          Total costs and expenses                                       18,394,447     20,381,794
                                                                       ------------   ------------

          Operating income                                                2,011,201      1,180,007
                                                                       ------------   ------------

OTHER INCOME (EXPENSE):
      Interest income                                                       685,975        215,726
      Interest expense                                                     (430,745)      (273,594)
      Other income and expense, net                                       2,523,391        498,613
                                                                       ------------   ------------

          Total other income (expense)                                    2,778,621        440,745
                                                                       ------------   ------------

          Income before income taxes                                      4,789,822      1,620,752

Provision for income taxes                                                2,155,000        675,000
                                                                       ------------   ------------

          Net income                                                   $  2,634,822   $    945,752
                                                                       ============   ============

Earnings per share:
          Net income per common share                                  $        .50   $        .17
                                                                       ============   ============

Weighted average number of common shares outstanding                      5,322,345      5,633,935
                                                                       ============   ============

           THE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    ARE AN INTEGRAL PART OF THESE STATEMENTS

                                  Page 4 of 16
</TABLE>
<PAGE>



                      UNITED CAPITAL CORP. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
               FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND 1996
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                               1997               1996
                                                                           -----------         ------------
<S>                                                                        <C>                 <C>        
Cash Flows From Operating Activities:
      Net income                                                           $ 2,634,822         $   945,752
                                                                           -----------         -----------
      Adjustments to reconcile net income to net cash
            provided by operating activities:
      Depreciation and amortization                                          1,847,198           2,050,151
      Loss from equity investments                                              60,506                --
      Changes in assets and liabilities (A)                                  3,450,334          (1,722,160)
                                                                           -----------         -----------


            Total adjustments                                                5,358,038             327,991
                                                                           -----------         -----------

                 NET CASH PROVIDED BY OPERATING ACTIVITIES                   7,992,860           1,273,743
                                                                           -----------         -----------

Cash Flows from Investing Activities:
            Acquisition of property, plant and equipment                      (639,728)           (179,190)
            Investment in and advances to affiliates                        (5,407,154)               --
                                                                           -----------         -----------

                 NET CASH USED IN INVESTING ACTIVITIES                      (6,046,882)           (179,190)
                                                                           -----------         -----------

Cash Flows from Financing Activities:
             Principal payments on mortgage commitments, notes and loans    (1,930,710)         (5,395,837)
            Net borrowings under revolving credit facilities                 1,300,000           3,715,000
            Purchase and retirement of common shares                          (656,970)           (600,000)
                                                                           -----------         -----------

                 NET CASH USED IN FINANCING ACTIVITIES                      (1,287,680)         (2,280,837)
                                                                           -----------         -----------

Net increase (decrease) in cash and cash equivalents                           658,298          (1,186,284)

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD                             3,177,878           3,527,925
                                                                           -----------         -----------

CASH AND CASH EQUIVALENTS AT END OF PERIOD                                 $ 3,836,176         $ 2,341,641
                                                                           ===========         ===========
</TABLE>

                                  Page 5 of 16
<PAGE>
                      UNITED CAPITAL CORP. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
         FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND 1996 (Continued)
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                      1997                 1996
                                                                                ---------------        ------------
<S>                                                                                  <C>                 <C>       
Supplemental Disclosures of Cash Flow
     Information:
            Cash Paid During the Period For:
                  Interest                                                           $1,432,000          $1,468,000
                  Taxes                                                                  97,000             608,000
                                                                                ===============        ============
</TABLE>


Supplemental Schedule of Noncash Investing
     and Financing Activities:
            See Notes to Consolidated Financial Statements


                  (A)           Changes in assets and liabilities for the three
                                 months  ended March 31,  1997 and 1996,  are as
                                 follows:

<TABLE>
<CAPTION>

<S>                                                                              <C>                     <C>          
Decrease in notes and accounts receivable, net                                  $     2,563               $    87,784
Decrease (increase) in inventories                                                  504,033                  (710,756)
Decrease (increase) in prepaid expenses
     and other current assets                                                        92,569                  (104,484)
Increase in deferred income taxes                                                  (143,664)                 (211,126)
Decrease in real property held for rental, net                                    3,209,912                    97,704
Decrease in noncurrent notes receivable                                              20,881                     7,343
Decrease (increase) in other assets                                                (100,565)                  108,386
Decrease in accounts payable and
     accrued liabilities                                                         (1,376,355)               (1,573,037)
Increase in income taxes payable                                                  1,269,184                   350,972
Increase (decrease) in other long-term liabilities                                  (28,224)                  225,054
                                                                                -----------               -----------

            Total                                                                $3,450,334              ($ 1,722,160)
                                                                                ===========               ===========
</TABLE>

         THE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS ARE
                      AN INTEGRAL PART OF THESE STATEMENTS

                                  Page 6 of 16
<PAGE>
                      UNITED CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)


BASIS OF PRESENTATION
---------------------

                  The accompanying  unaudited  consolidated financial statements
have been prepared in  accordance  with the  instructions  to Form 10-Q used for
quarterly  reports under Section 13 or 15(d) of the  Securities  Exchange Act of
1934, and therefore,  do not include all information and footnotes necessary for
a fair presentation of financial position,  results of operations and cash flows
in conformity with generally accepted accounting principles.

                  The consolidated financial information included in this report
has been prepared in conformity  with the  accounting  principles and methods of
applying those accounting  principles,  reflected in the consolidated  financial
statements  included in the Annual Report on Form 10-K filed with the Securities
and Exchange Commission for the year ended December 31, 1996.

                  All adjustments  necessary for a fair statement of the results
for the interim periods presented have been recorded.

                  The results of  operations  for the periods  presented are not
necessarily indicative of the results to be expected for the full year.

INVENTORIES
-----------

The components of inventory are as follows:

                                      March 31, 1997       December 31, 1996
                                      --------------       -----------------
                              
Raw materials                           $3,639,791            $3,893,865
Work in process                          2,113,341             2,126,849
Finished goods                           1,596,064             1,832,515
                                         ---------             ---------
                                        $7,349,196            $7,853,229
                                        ==========            ==========



                                  Page 7 of 16
<PAGE>
CONTINGENCIES
-------------

                  The Registrant has undertaken the completion of  environmental
studies and/or remedial action at Metex' two New Jersey facilities.

                  The process of remediation has begun at one facility  pursuant
to a plan filed with the New Jersey  Department of Environmental  Protection and
Energy ("NJDEPE"). Environmental experts engaged by the Registrant estimate that
under the most probable  remediation  scenario the  remediation  of this site is
anticipated to require initial  expenditures of $860,000,  including the cost of
capital equipment,  and $86,000 in annual operating and maintenance costs over a
15-year period.

                  Environmental  studies at the second  facility  indicate  that
remediation  may  be  necessary.  Based  upon  the  facts  presently  available,
environmental  experts have advised the Registrant  that under the most probable
remediation  scenario,  the estimated cost to remediate this site is anticipated
to  require  $2.3  million  in  initial  costs,   including   capital  equipment
expenditures,  and $258,000 in annual  operating  and  maintenance  costs over a
10-year  period.  The  Registrant may revise such estimates in the future due to
the  uncertainty  regarding  the  nature,  timing and extent of any  remediation
efforts  that may be required  at this site,  should an  appropriate  regulatory
agency deem such efforts to be necessary.

                  The foregoing  estimates may also be revised by the Registrant
as new or additional  information in these matters  becomes  available or should
the  NJDEPE or other  regulatory  agencies  require  additional  or  alternative
remediation  efforts in the future. It is not currently possible to estimate the
range or amount of any such liability.

                  Although the  Registrant  believes that it is entitled to full
defense and  indemnification  with respect to  environmental  investigation  and
remediation costs under its insurance policies,  the Registrant's  insurers have
denied such  coverage.  Accordingly,  the Registrant has filed an action against
certain insurance carriers seeking defense and  indemnification  with respect to
all prior and future costs  incurred in the  investigation  and  remediation  of
these sites. Upon the advice of counsel, the Registrant believes that based upon
a present  understanding  of the facts and the  present  state of the law in New
Jersey,  it is  probable  that  the  Registrant  will  prevail  in  the  pending
litigation and thereby access all or a very substantial portion of the insurance
coverage  it claims;  however,  the  ultimate  outcome of  litigation  cannot be
predicted.

                  As a result of the foregoing,  the Registrant has not recorded
a charge to operations for the  environmental  remediation,  noted above, in the
consolidated  financial  statements,  as  anticipated  proceeds  from  insurance
recoveries are expected to offset such  liabilities.  The Registrant has reached
settlements with several insurance carriers in this matter.

                  At March  31,  1997 and  December  31,  1996,  a total of $2.9
million in  anticipated  insurance  recoveries  is recorded in the  accompanying
consolidated financial statements and is included in other assets. Additionally,
in 1995 the Company received approximately $4.1 million of insurance recoveries.
The  remaining  balance of $2.9  million  at March 31,  1997 (from a total of $7
million ) is 

                                  Page 8 of 16
<PAGE>
in dispute with the Registrant's  insurance  carriers.  Management believes that
recoveries in excess of the amounts  reflected in the accompanying  consolidated
financial  statements,  are available under the insurance  policies but have not
been recorded.  There can be no assurance,  however,  that the  Registrant  will
prevail  in its  efforts  to obtain  amounts  at or in  excess of the  estimated
recoveries.

                  In the opinion of  management,  these matters will be resolved
favorably  and such  amounts,  if any,  not  recovered  under  the  Registrant's
insurance  policies  will  be  paid  gradually  over  a  period  of  years  and,
accordingly,  should  not have a  material  adverse  effect  upon the  business,
liquidity or financial position of the Registrant. However, adverse decisions or
events,  particularly  as to the merits of the  Registrant's  factual  and legal
basis could  cause the  Registrant  to change its  estimate  of  liability  with
respect to such matters in the future.

                  The  Registrant  is involved in various other  litigation  and
legal  matters  which are being  defended and handled in the ordinary  course of
business.  See Item 1. Legal  Proceedings for discussion of Rosatelli vs. United
Capital Corp.  None of these matters are expected to result in a judgment having
a material adverse effect on the Registrant's consolidated financial position or
results of operations.

NET INCOME PER COMMON SHARE
---------------------------

                  Net income per share  computations  for each quarterly  period
presented are based on the weighted average number of common shares and dilutive
common  equivalent  shares  outstanding  during the  period.  Fully  diluted and
primary earnings per common share are approximately the same amounts for each of
the periods presented.  Earnings per share data is neither restated nor adjusted
currently to obtain  quarterly  amounts which equal the amount  computed for the
year-to-date.

                  In February 1997,  Statement of Financial  Accounting Standard
No. 128,  Earnings  Per Share  ("SFAS  #128) was issued.  SFAS #128  changes the
methodology utilized to compute earnings per share and replaces primary EPS with
basic  EPS,  which  does not  include  any  dilution  for  potentially  dilutive
securities.  Fully diluted EPS, which is now called diluted EPS under SFAS #128,
is still required.  This standard is effective for periods ending after December
15,  1997 and  early  application  is  prohibited.  If EPS had  been  determined
consistent  with SFAS #128,  earnings  per share  would  have been the  proforma
amounts indicated below:

                                                 Three Months Ended March 31
                                                 ---------------------------
                                                       1997            1996
                                                       ----            ----
Primary EPS, as reported                               .50             .17
Pro Forma Basic EPS                                    .50             .17

Fully Diluted EPS, as reported                         .49             .17
Pro Forma Diluted EPS                                  .50             .17



                                  Page 9 of 16
<PAGE>
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 the financial
statements  and the  reported  amounts  of  revenues  and  expenses  during  the
reporting period. Actual results could differ from those estimates.

RECLASSIFICATIONS
-----------------

                  Certain  amounts  have been  reclassified  in the  prior  year
consolidated financial statements to present them on a basis consistent with the
current year.

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

RESULTS OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 1997 AND 1996
------------------------------------------

                  Revenues  for the three month period ended March 31, 1997 were
$20,406,000, a $1,156,000 decrease from comparable 1996 revenues. Net income for
the  period  was  $2,635,000  or $.50 per  share as  compared  to net  income of
$946,000 or $.17 per share for the same period in 1996.

REAL ESTATE OPERATIONS
----------------------

                  Rental  revenues  from real  estate  operations  decreased  by
$292,000 for the three  months ended March 31, 1997  compared to the same period
in 1996.  The decrease is primarily  attributable  to revenues  associated  with
properties sold in 1996.

                  Mortgage interest expense decreased $261,000 or 24% during the
current quarter,  versus such expense of the corresponding period in 1996. These
decreases are due to continuing  mortgage  amortization  which  approximated  $6
million  during the last twelve months,  including  repayments  associated  with
properties sold.

                  Depreciation   expense   associated  with  rental   properties
decreased  $162,000,  versus such expense of the  corresponding  period in 1996.
This decrease is primarily due to the impact of properties sold in 1996.

                  Operating  expenses  associated  with the  management  of real
properties  decreased  $429,000 or 22% for the  quarter  ended March 31, 1997 as
compared  to the same  period in 1996.  The  implementation  of certain  capital
improvements in 1996 and the timing of certain maintenance  projects contributed
to these cost savings.


                                 Page 10 of 16
<PAGE>
ENGINEERED PRODUCTS
-------------------

                  The  Registrant's  engineered  products segment includes Metex
Corporation and AFP  Transformers,  Inc. The operating results of the engineered
products segment are as follows:

                                                       Three Months
                                                    Ended March 31,
                                                    ---------------

(In thousands)                                1997                   1996
                                             ------                 -----

Net Sales                                    $9,574               $ 11,050
                                             ======                =======

Cost of Sales                                $6,970               $  8,285
                                             ======                =======

Selling, General and
 Administrative Expenses                     $1,798               $  1,762
                                             ======                =======

Income from Operations                       $  806               $  1,003
                                             ======                =======


                  Net  sales  of  the  engineered   products  segment  decreased
$1,476,000  for the three month  period  ended March 31, 1997 as compared to the
same period in 1996. The decrease is primarily  attributable  to continued price
competition and declining worldwide  automotive sales for knitted wire products.
The  transformer  division  continues to show growth with a 3% increase in sales
compared to the first quarter of 1996.

                  Cost of  sales  as a  percentage  of net  sales  decreased  by
approximately  2% in the three month period ended March 31, 1997, as compared to
the corresponding  period in 1996. This decrease was due to continued management
focus on cost containment as well as product mix.

                  Selling, general and administrative expenses of the engineered
products  segment  increased  $36,000  during the  quarter  ended March 31, 1997
versus such costs of the comparable 1996 period.  This increase is primarily the
result of additional salary related costs.

                                 Page 11 of 16
<PAGE>
ANTENNA SYSTEMS
---------------

                  The operating  results of the antenna  systems  segment are as
follows:

                                                          Three Months
                                                        Ended March 31,
                                                        ---------------

(In thousands)                                        1997            1996
                                                      ----            ----

Net Sales                                           $5,206          $4,594
                                                    ======          ======

Cost of Sales                                       $3,891          $3,738
                                                    ======          ======

Selling, General and Administrative
       Expenses                                     $1,155          $1,283
                                                    ======          ======

Income (Loss) from Operations                       $  160          ($ 427)
                                                    ======           =====

                  Net sales of the antenna systems segment increased $612,000 or
13% during the quarter ended March 31, 1997 versus the same period in 1996.  The
1996 sales level  reflected  manufacturing  output below planned  levels and was
attributable to operational problems experienced in the first half of that year.
Actions initiated by senior management in 1996 increased the sales volume in the
second half of 1996 to a level consistent with the first quarter of 1997.

                   Cost of sales as a  percentage  of sales  decreased to 75% as
compared to 81% in the prior period,  principally due to increased  productivity
associated with higher shipment levels.

                  Selling,  general  and  administrative  costs  of the  antenna
systems  segment  decreased  approximately  $129,000  during the current quarter
ended March 31, 1997, versus that of the corresponding  prior year period.  This
reduction is principally due to reduced selling  expenses,  primarily salary and
salary related expenses.

GENERAL AND ADMINISTRATIVE EXPENSES
-----------------------------------

General  and   administrative   ("G&A")   expenses  not   associated   with  the
manufacturing  operations  increased by $120,000 or less than 1% of revenues for
the three month period ended March 31, 1997, versus the same period in 1996.

                                 Page 12 of 16
<PAGE>
OTHER INCOME AND EXPENSE
------------------------

                  The components of other income and expense in the accompanying
consolidated statements of income are as follows:

                                                               Three Months
                                                             Ended March 31,

                                                       1997               1996
                                                       -----              ----

Gain on sale of real estate assets                    $ 2,583,840       $478,487

(Loss) from equity investments                            (60,556)          --

Other                                                        --           20,126
                                                      -----------       --------

                                                      $ 2,523,391       $498,613
                                                      ===========       ========

LIQUIDITY AND CAPITAL RESOURCES
-------------------------------

                  At  March  31,  1997  the  Registrant's   current  liabilities
exceeded current assets by approximately $7.6 million. This shortfall in working
capital  results  from  financing  the purchase of  long-term  assets  utilizing
short-term   borrowings  and  from  the   classification   of  current  mortgage
obligations  without  the  benefit  of a  corresponding  current  asset for such
properties.  Management  is  confident  that through  cash flow  generated  from
operations,  together  with  borrowings  available  under  the  line  of  credit
discussed below and the sale of select assets, all obligations will be satisfied
as they become due.

                  Effective  January 15,  1997,  the  Registrant  entered into a
Revolving  Credit  Agreement  ("Revolver")  with two  banks  that  provides  for
borrowings  of up to  $40  million  and  which  expires  on  January  15,  2000.
Borrowings  under the Revolver,  at the  Registrant's  option,  bear interest at
Prime or LIBOR plus 1.75%. Under the terms of the Revolver,  the Registrant will
be  provided  with  eligibility  based upon the sum of (i) 50% of the  aggregate
annualized  and  normalized   year-to-date  net  operating  income  of  eligible
properties, as defined,  capitalized at 11.5% and (ii) the lesser of $12 million
or the sum of 75% of eligible accounts receivable and 50% of eligible inventory,
as defined.  The terms of the Revolver contain certain financial and restrictive
covenants,  including  minimum  consolidated  equity,  interest  coverage,  debt
service coverage and capital expenditures (other than for real estate). At March
31,  1997,  approximately  $19 million was  available  to be borrowed  under the
Revolver.  The Registrant classified $8,880,000 of borrowings  outstanding under
this facility at March 31, 1997 as long-term debt as the Registrant has both the
ability and the intent to refinance these amounts on a long-term basis under the
new credit facility.

                  The Registrant has undertaken the completion of  environmental
studies and/or remedial action at Metex' two New Jersey facilities and has filed
an action against certain insurance  carriers seeking recovery of costs incurred
and to be  incurred  in  these  matters.  Based  upon  the  advice  of  counsel,
management  believes such  recovery is probable and therefore  should not have a
material  

                                 Page 13 of 16
<PAGE>
effect on the liquidity or capital  resources of the  Registrant.  However,  the
ultimate  outcome of litigation  cannot be predicted.  To date  settlements have
been  reached with several  carriers in this matter.  See Notes to  consolidated
financial statements.

                  At  March  31,  1997  and  December  31,  1996 a total of $2.9
million  in   anticipated   insurance   recoveries  has  been  recorded  in  the
accompanying  consolidated financial statements and is included in other assets.
Additionally,  in 1995 the  Registrant  received  approximately  $4.1 million of
insurance  recoveries.  The remaining  balance of $2.9 million at March 31, 1997
(from a total of $7  million)  is in  dispute  with the  Registrant's  insurance
carriers. Management believes that recoveries in excess of the amounts reflected
in the accompanying  consolidated financial statements,  are available under the
insurance  policies  but have  not been  recorded.  There  can be no  assurance,
however, that the Registrant will prevail in its efforts to obtain amounts at or
in excess of the estimated recoveries.

                  The cash  needs of the  Registrant  have been  satisfied  from
funds generated by current operations and additional borrowings.  It is expected
that  future  operational  cash  needs  will  also  be  satisfied  from  ongoing
operations  and  additional  borrowings on the Revolver.  The primary  source of
capital to fund  additional  real  estate  acquisitions  and to make  additional
high-yield mortgage loans will come from the sale,  financing and refinancing of
the  Registrant's  properties  and from the third party  mortgages  and purchase
money notes obtained in connection with specific acquisitions.

                  In addition to the acquisition of properties for consideration
consisting of cash and mortgage financing  proceeds,  the Registrant may acquire
real  properties  in  exchange  for  the  issuance  of the  Registrant's  equity
securities.  The Registrant may also finance  acquisitions of other companies in
the future  with  borrowings  from  institutional  lenders  and/or the public or
private offerings of debt or equity securities.

                  Funds of the  Registrant  in excess of that needed for working
capital,  purchasing  real  estate  and  arranging  financing  for  real  estate
acquisitions  are invested by the  Registrant  in corporate  equity  securities,
corporate  notes,  other  financial  instruments,  certificates  of deposit  and
government securities.


BUSINESS TRENDS
---------------

                  Total  revenues of the Registrant  decreased  $1,156,000 or 5%
for the first three  months of 1997 versus such results of the  comparable  1996
period. Net income for the first three months of 1997 was $2,635,000 or $.50 per
share versus $946,000 or $.17 per share during the same period in 1996.

                                 Page 14 of 16
<PAGE>
                  The results of the Registrant's real estate operations reflect
a decrease in revenues for the first three months of 1997, primarily as a result
of revenues associated with properties sold in 1996. The real estate segment was
also  favorably  impacted  by a  24%  reduction  in  mortgage  interest  expense
resulting from the repayment of $6 million in mortgage  indebtedness  during the
last twelve  months.  Continuing  mortgage  amortization  will  continue to have
favorable impact on this segment and will reduce current  mortgage  indebtedness
to virtually zero in less than nine years.

                  The  Registrant's  engineered  products  segment  posted a 13%
decrease in revenues  during the first  three  months of 1997 versus  comparable
1996 results. With continued decreases in worldwide automobile sales, management
is focused on new sales opportunities including new geographical markets for its
existing products and new applications for its core  technologies.  In addition,
the results of this segments'  transformer  operations reflect improvements over
the prior year and management is hopeful to continue this trend.

                  The  results  of  the  Registrant's  antenna  systems  segment
reflect a significant turnaround in the current quarter. The Registrant believes
that actions  taken by senior  management  in 1996 have returned this segment to
profitability  and  senior  management  will  continue  to closely  monitor  the
operations of this segment.


FORWARD-LOOKING STATEMENTS
--------------------------

                  This Form 10-Q  contains  certain  forward-looking  statements
within the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the  Securities  Exchange Act of 1934, as amended (the  "Exchange
Act"), which are intended to be covered by the safe harbors created thereby. All
forward-looking  statements  involve risks and  uncertainty,  including  without
limitation,  general  economic  conditions,  competition,  potential  technology
changes and potential changes in customer  spending and purchasing  policies and
procedures. Although the Registrant believes that the assumptions underlying the
forward-looking   statements  contained  herein  are  reasonable,   any  of  the
assumptions could be inaccurate,  and therefore,  there can be no assurance that
the  forward-looking  statements  included  in this Form  10-Q will  prove to be
accurate.   In  light  of  the   significant   uncertainties   inherent  in  the
forward-looking  statements  included herein,  the inclusion of such information
should not be regarded as a representation by the Registrant or any other person
that the objectives and plans of the Registrant will be achieved.

PART II OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

Rosatelli vs. United Capital Corp.
----------------------------------

In August 1996,  Dennis  Rosatelli,  the  Registrant's  former  Chief  Financial
Officer  commenced  an action in  Superior  Court of New Jersey,  Law  Division,
Bergen  County,  seeking,  among  other  things,  payment  under his  employment
contract,  and  indemnification  for claims against him by the Internal  Revenue
Service and other matters in connection with his tenure. The Registrant believes

                                 Page 15 of 16
<PAGE>
that as a  result  of Mr.  Rosatelli's  gross  negligence,  recklessness  and/or
willful  disregard  of his duties and  responsibilities,  Mr.  Rosatelli  is not
entitled to the recoveries he seeks. Mr.  Rosatelli's  employment was terminated
by the Registrant in May, 1996 for cause.  The matter has been removed to United
States  District  Court,  District  of New  Jersey.  This action is in the early
stages of pretrial  discovery.  The Registrant intends to vigorously defend this
action and has asserted  counterclaims  against Mr.  Rosatelli  for, among other
things,  the set off of amounts by which he has damaged the  Registrant  against
his claims under his employment contract.

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

              (a)  Exhibit 27.  Financial Data Schedule
              (b)  Reports on Form 8-K
                   none


                                   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.

                                     UNITED CAPITAL CORP.

Dated:  May 14, 1997                 By: /s/ Anthony J. Miceli
                                        --------------------------------
                                        Anthony J. Miceli
                                        Vice President, Chief Financial Officer
                                        and Secretary of the Registrant







                                 Page 16 of 16