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               June 30, 2000
                               ----------------------------------------------

                                       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 Company 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
--------------------------------------------------------------------------------
                (Company'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 Company (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  Company  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 4,730,915 shares outstanding
                              as of August 8, 2000.



                                  Page 1 of 17
<PAGE>

                      UNITED CAPITAL CORP. AND SUBSIDIARIES

                                      INDEX

                          PART I FINANCIAL INFORMATION
                                                                            PAGE
                                                                            ----


ITEM 1.        FINANCIAL STATEMENTS

               Consolidated Balance Sheets as
               of June 30, 2000 and December 31, 1999                         3

               Consolidated Statements of Income for the
               Three Months Ended June 30, 2000 and 1999                      4

               Consolidated Statements of Income for the
               Six Months Ended June 30, 2000 and 1999                        5

               Consolidated Statements of Cash Flows for the
               Six Months Ended June 30, 2000 and 1999                    6 - 7

               Notes to Consolidated Financial Statements                8 - 11

ITEM 2.        MANAGEMENT'S DISCUSSION AND ANALYSIS OF
               FINANCIAL CONDITION AND RESULTS OF OPERATIONS            12 - 17


                            PART II OTHER INFORMATION

ITEM 4.        SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS           17

ITEM 6.        EXHIBITS AND REPORTS ON FORM 8-K                              17

SIGNATURES                                                                   17


                                  Page 2 of 17
<PAGE>

                      UNITED CAPITAL CORP. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
              AS OF JUNE 30, 2000 (UNAUDITED) AND DECEMBER 31, 1999
                                 (In Thousands)

                                                            2000       1999
                                                            ----       ----

Assets

Current assets:
     Cash and cash equivalents                            $ 13,146   $ 13,575
     Marketable securities                                  36,759     27,296
     Notes and accounts receivable, net                     12,425      5,626
     Inventories                                             4,069      4,207
     Prepaid expenses and other current assets                 354        254
                                                          --------   --------

         Total current assets                               66,753     50,958
                                                          --------   --------

Property, plant and equipment, net                           4,764      5,077
Real property held for rental, net                          60,568     66,939
Noncurrent notes receivable                                    254        270
Other assets                                                11,115     10,488
                                                          --------   --------

         Total assets                                     $143,454   $133,732
                                                          ========   ========

Liabilities and Stockholders' Equity

Current liabilities:
     Current maturities of long-term debt                 $  5,756   $  5,990
     Borrowings under credit facilities                        700        700
     Accounts payable and accrued liabilities                9,563      9,835
     Income taxes payable                                    8,540      5,000
     Deferred income taxes                                   1,220      1,019
                                                          --------   --------

         Total current liabilities                          25,779     22,544
                                                          --------   --------

Borrowings under credit facilities                             875      1,225
Long-term debt                                              24,474     27,316
Other long-term liabilities                                 24,594     22,917
Deferred income taxes                                          862        674
                                                          --------   --------

         Total liabilities                                  76,584     74,676
                                                          --------   --------

Commitments and contingencies

Stockholders' equity:
     Common stock                                              473        474
     Retained earnings                                      62,113     54,671
     Accumulated other comprehensive income, net of tax      4,284      3,911
                                                          --------   --------

         Total stockholders' equity                         66,870     59,056
                                                          --------   --------

         Total liabilities and stockholders' equity       $143,454   $133,732
                                                          ========   ========


       The accompanying Notes to Consolidated Financial Statements are an
                     integral part of these balance sheets.

                                  Page 3 of 17
<PAGE>

                      UNITED CAPITAL CORP. AND SUBSIDIARIES
                        CONSOLIDATED STATEMENTS OF INCOME
                FOR THE THREE MONTHS ENDED JUNE 30, 2000 AND 1999
                                   (UNAUDITED)
                      (In Thousands, Except Per Share Data)


                                                              2000       1999
                                                              ----       ----

Revenues:
     Net sales                                             $  9,091    $  7,912
     Rental revenues from real estate operations              6,979       6,801
                                                           --------    --------

                 Total revenues                              16,070      14,713
                                                           --------    --------

Costs and expenses:
     Cost of sales                                            6,479       5,478
     Real estate operations:
         Mortgage interest expense                              567         753
         Depreciation expense                                 1,257       1,380
         Other operating expenses                             1,629       1,653
     General and administrative expenses                      1,362       1,438
     Selling expenses                                         1,052         993
                                                           --------    --------

                 Total costs and expenses                    12,346      11,695
                                                           --------    --------

     Operating income                                         3,724       3,018
                                                           --------    --------

Other income (expense):
     Interest income                                            584         455
     Interest expense                                          (134)       (165)
     Other income and expense, net                            2,482       1,183
                                                           --------    --------

                 Total other income                           2,932       1,473
                                                           --------    --------

     Income before income taxes                               6,656       4,491

     Provision for income taxes                               2,835       1,915
                                                           --------    --------

     Net income                                            $  3,821    $  2,576
                                                           ========    ========

     Earnings per share:
         Basic                                             $    .81    $    .51
                                                           ========    ========
         Diluted                                           $    .81    $    .51
                                                           ========    ========


       The accompanying Notes to Consolidated Financial Statements are an
                       integral part of these statements.


                                  Page 4 of 17
<PAGE>

                      UNITED CAPITAL CORP. AND SUBSIDIARIES
                        CONSOLIDATED STATEMENTS OF INCOME
                 FOR THE SIX MONTHS ENDED JUNE 30, 2000 AND 1999
                                   (UNAUDITED)
                      (In Thousands, Except Per Share Data)


                                                              2000       1999
                                                              ----       ----

Revenues:
     Net sales                                             $ 17,288    $ 15,565
     Rental revenues from real estate operations             13,880      13,323
                                                           --------    --------

                 Total revenues                              31,168      28,888
                                                           --------    --------

Costs and expenses:
     Cost of sales                                           12,486      11,138
     Real estate operations:
         Mortgage interest expense                            1,162       1,356
         Depreciation expense                                 2,555       2,747
         Other operating expenses                             3,349       3,661
     General and administrative expenses                      2,718       2,976
     Selling expenses                                         2,025       1,984
                                                           --------    --------

                 Total costs and expenses                    24,295      23,862
                                                           --------    --------

     Operating income                                         6,873       5,026
                                                           --------    --------

Other income (expense):
     Interest income                                          1,168         765
     Interest expense                                          (313)       (328)
     Other income and expense, net                            5,164       5,184
                                                           --------    --------

                 Total other income                           6,019       5,621
                                                           --------    --------

     Income before income taxes                              12,892      10,647

     Provision for income taxes                               5,390       4,485
                                                           --------    --------

     Net income                                            $  7,502    $  6,162
                                                           ========    ========

     Earnings per share:
         Basic                                             $   1.58    $   1.22
                                                           ========    ========
         Diluted                                           $   1.58    $   1.21
                                                           ========    ========


       The accompanying Notes to Consolidated Financial Statements are an
                       integral part of these statements.


                                  Page 5 of 17
<PAGE>

                      UNITED CAPITAL CORP. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                 FOR THE SIX MONTHS ENDED JUNE 30, 2000 AND 1999
                                   (UNAUDITED)
                                 (In Thousands)

<TABLE>
<CAPTION>

                                                                                2000       1999
                                                                                ----       ----


Cash flows from operating activities:
<S>                                                                         <C>         <C>
     Net income                                                             $  7,502    $  6,162
                                                                            --------    --------
     Adjustments to  reconcile net income
       to net cash  provided  by  operating activities:
              Depreciation and amortization                                    3,207       3,334
              Gain on sale of real estate assets                              (3,544)     (3,957)
              Gain on sale of available-for-sale securities                   (1,643)          0
              Gain from equity investments                                      (496)     (1,264)
              Changes in assets and liabilities  (A)                          (2,150)      2,489
                                                                            --------    --------

                        Total adjustments                                     (4,626)        602
                                                                            --------    --------

                        Net cash provided by operating activities              2,876       6,764
                                                                            --------    --------

Cash flows from investing activities:
     Acquisition of real estate assets                                          (450)       (314)
     Proceeds from sale of real estate assets                                  7,865       5,800
     Purchase of available-for-sale securities                               (14,947)     (5,205)
     Proceeds from sale of available-for-sale securities                       7,699           0
     Acquisition of property, plant and equipment                               (355)       (689)
     Investments in and advances to affiliates                                   369         369
     Proceeds from sale of equity investments                                      0       1,300
                                                                            --------    --------

                        Net cash provided by investing activities                181       1,261
                                                                            --------    --------

Cash flows from financing activities:
     Principal payments on mortgage commitments, notes
         and loans                                                            (3,076)     (3,123)
     Proceeds from mortgage commitments, notes and loans                           0       6,560
     Net repayments under credit facilities                                     (350)       (700)
     Purchase and retirement of common shares                                    (60)     (2,943)
     Proceeds from the exercise of stock options                                   0         142
                                                                            --------    --------

                        Net cash used in financing activities                 (3,486)        (64)
                                                                            --------    --------

Net (decrease) increase in cash and cash equivalents                            (429)      7,961

Cash and cash equivalents, beginning of period                                13,575       8,154
                                                                            --------    --------

Cash and cash equivalents, end of period                                    $ 13,146    $ 16,115
                                                                            ========    ========
</TABLE>


                                  Page 6 of 17

<PAGE>

                      UNITED CAPITAL CORP. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
           FOR THE SIX MONTHS ENDED JUNE 30, 2000 AND 1999 (CONTINUED)
                                   (UNAUDITED)



(A)  Changes in assets and liabilities for the six months ended June 30,
     2000 and 1999 are as follows:


                                                      2000         1999
                                                      ----         ----

   Notes and accounts receivable, net                ($6,799)     ($144)
   Inventories                                           138        107
   Prepaid expenses and other current assets            (100)      (184)
   Deferred income taxes                                 189        891
   Noncurrent notes receivable                            16          9
   Other assets                                         (539)     2,214
   Accounts payable and accrued liabilities             (272)    (1,179)
   Income taxes payable                                3,540        780
   Other long-term liabilities                         1,677         (5)
                                                     -------     -------

                 Total                               ($2,150)    $2,489
                                                    ========     ======


       The accompanying Notes to Consolidated Financial Statements are an
                       integral part of these statements.



                                  Page 7 of 17
<PAGE>

                      UNITED CAPITAL CORP. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 (In Thousands, Except Share And Per Share Data)
                                   (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, as
amended,  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, 1999.

         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.

MARKETABLE SECURITIES

         The  aggregate  market value of  marketable  securities,  which are all
classified as  available-for-sale,  was $36,759 and $27,296 at June 30, 2000 and
December 31, 1999, respectively, while accumulated unrealized holding gains were
$4,284  and $3,911 on a net of tax basis,  respectively.  Marketable  securities
consist of the following:

                                   June 30, 2000     December 31, 1999
                                   -------------     -----------------

Available-For-Sale Securities:
Corporate equities                    $35,736            $21,685
Corporate debts                         1,023              5,611
                                      -------            -------
                                      $36,759            $27,296
                                      =======            =======

         Corporate debt securities have contractual  maturities of approximately
four years.

INVENTORIES

         The components of inventory are as follows:

                                     June 30, 2000      December 31, 1999
                                     -------------      -----------------

             Raw materials              $2,221            $2,369
             Work in process               504               334
             Finished goods              1,344             1,504
                                        ------            ------
                                        $4,069            $4,207
                                        ======            ======


                                  Page 8 of 17
<PAGE>

CONTINGENCIES

         The Company has  undertaken  the  completion of  environmental  studies
and/or  remedial  action at Metex' two New Jersey  facilities.  The  Company has
recorded a liability in the Consolidated  Financial Statements for the estimated
potential remediation costs at these facilities.

         The process of remediation has begun at one facility pursuant to a plan
filed with the New Jersey  Department  of  Environmental  Protection  ("NJDEP").
Environmental  experts  engaged  by the  Company  estimate  that  under the most
probable  remediation  scenario the  remediation  of this site is anticipated to
require initial  expenditures  of $860 including the cost of capital  equipment,
and $86 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  Company  that under the most  probable  remediation
scenario,  the estimated  cost to remediate  this site is anticipated to require
$2,300 in initial costs, including capital equipment  expenditures,  and $258 in
annual  operating and maintenance  costs over a 10 year period.  These estimated
costs of future  expenses  for  environmental  remediation  obligations  are not
discounted to their present value.  The Company 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 Company as new or
additional information in these matters becomes available or should the NJDEP 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 Company  believed that it was entitled to full defense and
indemnification  with respect to  environmental  investigation  and  remediation
costs under its insurance policies, the Company's insurers denied such coverage.
Accordingly,  the Company 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.  Settlements have
been reached with all carriers in this matter.

         In the opinion of  management,  amounts  recovered  from its  insurance
carriers  should be sufficient  to address  these matters and amounts  needed in
excess, if any, will be paid gradually over a period of years. Accordingly, they
should  not have a material  adverse  effect  upon the  business,  liquidity  or
financial  position  of the  Company.  However,  adverse  decisions  or  events,
particularly  as to the merits of the  Company's  factual  and legal basis could
cause the  Company to change its  estimate  of  liability  with  respect to such
matters in the future.

         The Company is involved in various other  litigation  and legal matters
which are being defended and handled in the ordinary course of business. None of
these  matters are  expected to result in a judgment  having a material  adverse
effect  on  the  Company's   consolidated   financial  position  or  results  of
operations.


                                  Page 9 of 17
<PAGE>

EARNINGS PER SHARE

         The  following  table sets forth the  computation  of basic and diluted
earnings per share:
<TABLE>
<CAPTION>

                                                            Three Months        Six Months
                                                           Ended June 30,      Ended June 30,
                                                           --------------      --------------

                                                           2000     1999     2000     1999
                                                           ----     ----     ----     ----

Numerator:
<S>                                                       <C>      <C>      <C>      <C>
     Net income                                           $3,821   $2,576   $7,502   $6,162
                                                          ======   ======   ======   ======

Denominator:
     Denominator for basic earnings per
                share--weighted-average shares             4,731    5,011    4,734    5,053
Effect of dilutive securities:
     Employee stock options                                   13       20       18       23
                                                          ------   ------   ------   ------
     Denominator for diluted earnings per
                share--adjusted weighted-average shares
                and assumed conversions                    4,744    5,031    4,752    5,076
                                                          ======   ======   ======   ======

Basic earnings per share                                  $  .81   $  .51   $ 1.58   $ 1.22
                                                          ======   ======   ======   ======

Diluted earnings per share                                $  .81   $  .51   $ 1.58   $ 1.21
                                                          ======   ======   ======   ======
</TABLE>

COMPREHENSIVE INCOME

         The Company's  comprehensive  income consists of net income and changes
in net unrealized gains from investments in available-for-sale  securities.  The
components of comprehensive income are as follows:
<TABLE>
<CAPTION>

                                                  Three Months      Six Months
                                                 Ended June 30,    Ended June 30,
                                                 --------------    --------------

                                                 2000      1999     2000    1999
                                                 ----      ----     ----    ----

<S>                                              <C>      <C>      <C>      <C>
Net income                                       $3,821   $2,576   $7,502   $6,162

Other comprehensive income, net of tax:
     Change in net unrealized gain on
     available-for-sale securities, net of tax
     provisions of $1,292, $896, $201
     and $486, respectively
                                                  2,313    1,572      373      775
                                                 ------   ------   ------   ------

Comprehensive income                             $6,134   $4,148   $7,875   $6,937
                                                 ======   ======   ======   ======
</TABLE>


                                 Page 10 of 17
<PAGE>

BUSINESS SEGMENTS

         The  Company  operates  through  two  business  segments:  real  estate
investment and management and engineered  products.  The real estate  investment
and  management  segment is engaged in the business of investing in and managing
real estate properties and the making of high-yield, short-term loans secured by
desirable properties.  Engineered products are manufactured through wholly-owned
subsidiaries  of the Company and primarily  consist of knitted wire products and
components and transformer products.

         Operating results of the Company's business segments are as follows:
<TABLE>
<CAPTION>

                                                                 Three Months            Six Months
                                                                 Ended June 30,        Ended June 30,
                                                                 --------------        --------------

                                                                2000       1999        2000       1999
                                                                ----       ----        ----       ----

Net revenues and sales:
<S>                                                          <C>         <C>         <C>         <C>
     Real estate investment and management                   $  6,979    $  6,801    $ 13,880    $ 13,323
     Engineered products                                        9,091       7,912      17,288      15,565
                                                             --------    --------    --------    --------

                                                             $ 16,070    $ 14,713    $ 31,168    $ 28,888
                                                             ========    ========    ========    ========

Operating income:
     Real estate investment and management                   $  3,526    $  3,015    $  6,814    $  5,559
     Engineered products                                          831         685       1,274         972
                                                             --------    --------    --------    --------
                                                                4,357       3,700       8,088       6,531

     General corporate expenses                                  (633)       (682)     (1,215)     (1,505)
     Other income, net                                          2,932       1,473       6,019       5,621
                                                             --------    --------    --------    --------

                Income before income taxes                   $  6,656    $  4,491    $ 12,892    $ 10,647
                                                             ========    ========    ========    ========
</TABLE>

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.


                                 Page 11 of 17
<PAGE>

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

RESULTS OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 2000 AND 1999

         Revenues  for the three  month  period  ended June 30,  2000 were $16.1
million,  an increase of $1.4  million or 9.2% from  comparable  1999  revenues.
Operating income during this period was $3.7 million versus $3.0 million for the
comparable 1999 period, a 23.4% increase.  Net income for the second quarter was
$3.8  million or $.81 per basic share  compared to net income of $2.6 million or
$.51 per  basic  share  for the same  period in 1999.  This  represents  a 58.8%
increase in earnings per basic share over the prior year.

         Total  revenues  for the first six  months of 2000 were  $31.2  million
resulting in operating  income of $6.9 million versus  revenues of $28.9 million
and operating  income of $5.0 million  during the  comparable  1999 period.  Net
income  for the six month  period was $7.5  million or $1.58 per basic  share in
2000 versus $6.2 million or $1.22 per basic share in 1999,  an increase of 29.5%
in basic earnings per share.

REAL ESTATE OPERATIONS

         Rental  revenues from real estate  operations  increased by $178,000 or
2.6% for the three months and $557,000 or 4.2% for the six months ended June 30,
2000 when compared to the corresponding  periods in 1999. These increases result
primarily from an increase in the Company's hotel revenues.

         Mortgage interest expense  decreased  $186,000 for the three months and
$194,000  for the six months ended June 30, 2000  compared to the  corresponding
1999 periods,  due to continuing  mortgage  amortization which approximated $5.3
million during the last 12 months.

         Depreciation   expense  associated  with  rental  properties  decreased
$123,000 or 8.9% for the three  months  ended June 30, 2000 and $192,000 or 7.0%
for the six months  ended June 30, 2000  compared  to the same  periods in 1999.
These  decreases are primarily due to reduced  depreciation  expense  associated
with properties sold in 2000 and 1999.

         Operating  expenses  associated  with the management of real properties
decreased  $24,000 for the current quarter and $312,000 for the first six months
of 2000  compared to the  corresponding  periods in 1999.  These  decreases  are
principally due to increased expenses in 1999 associated with the maintenance of
properties acquired in 1998.



                                 Page 12 of 17
<PAGE>

ENGINEERED PRODUCTS

         The  Company's   engineered   products   segment  includes  Metex  Mfg.
Corporation  ("Metex")  and AFP  Transformers,  LLC  ("AFP  Transformers").  The
operating results of the engineered products segment are as follows:

                                 Three Months       Six Months
(In Thousands)                   Ended June 30,     Ended June 30,
                                 --------------     --------------

                                 2000      1999     2000      1999
                                 ----      ----     ----      ----

Net Sales                       $9,091   $ 7,912   $17,288   $15,565
                                ======   =======   =======   =======

Cost of Sales                   $6,479   $ 5,478   $12,486   $11,138
                                ======   =======   =======   =======

Selling, General and
      Administrative Expenses   $1,781   $ 1,749   $ 3,528   $ 3,455
                                ======   =======   =======   =======

Income from Operations          $  831   $   685   $ 1,274   $   972
                                ======   =======   =======   =======


         Net sales of the engineered  products segment increased $1.2 million or
14.9% for the three month  period  ended June 30, 2000 and $1.7 million or 11.0%
for the six month  period  ended June 30, 2000  compared to the same  periods in
1999. These increases are primarily the result of higher sales in the engineered
products and European  automotive  markets at Metex' Technical Products Division
and higher sales generated by AFP Transformers.

         Cost of sales as a percentage of sales increased approximately 2.0% and
less than 1.0% for the three and six months  ended June 30,  2000  respectively,
compared  to the  corresponding  periods in 1999  principally  due to the mix of
products sold.

         Selling, general and administrative expenses of the engineered products
segment increased $32,000 or 1.8% during the current quarter and $73,000 or 2.1%
for the first six  months of 2000  versus the  comparable  1999  periods.  These
increases  are primarily due to  additional  selling costs  associated  with the
higher sales volume noted above.

GENERAL AND ADMINISTRATIVE EXPENSES

         General  and   administrative   expenses   not   associated   with  the
manufacturing  operations  decreased  by $49,000 or 7.2% and  $290,000  or 19.3%
respectively,  for the three and six months ended June 30, 2000  compared to the
same periods in 1999.  These  decreases  are  principally  due to a reduction in
professional fees.


                                 Page 13 of 17
<PAGE>

OTHER INCOME AND EXPENSE, NET

         The  components  of other income and expense,  net in the  accompanying
Consolidated Statements of Income are as follows:
<TABLE>
<CAPTION>

                                                  Three Months        Six Months
     (In Thousands)                               Ended June 30,     Ended June 30,
                                                  --------------     --------------
                                                  2000     1999      2000       1999
                                                  ----     ----      ----       ----

<S>                                             <C>        <C>       <C>        <C>
Gain on sale of real estate assets              $   878    $   835   $ 3,544    $ 3,957

Gain from equity investments                          0          0         0        838

Gain on sale of available-for-sale securities     1,619          0     1,643          0

Other                                               (15)       348       (23)       389
                                                -------    -------   -------    -------

                                                $ 2,482    $ 1,183   $ 5,164    $ 5,184
                                                =======    =======   =======    =======
</TABLE>


LIQUIDITY AND CAPITAL RESOURCES

         At June 30, 2000,  the Company's cash and  marketable  securities  were
$49.9 million and working capital was  approximately  $41.0 million.  Management
continues to believe the real estate market is overvalued and accordingly recent
acquisitions  have  been  limited  to  those  select  properties  that  meet the
Company's  stringent financial  requirements.  Management believes the available
working  capital along with the $60.0 million of  availability  on the revolving
credit  facility  discussed  below,  puts it in an  opportune  position  to fund
acquisitions and grow the portfolio as attractive long-term opportunities become
available. The current liabilities of the Company have historically exceeded its
current  assets  principally  due to the  financing of the purchase of long-term
assets utilizing  short-term  borrowings and from the  classification of current
mortgage   obligations   without  the  corresponding   current  asset  for  such
properties.  Future  financial  statements  may reflect  current  liabilities in
excess of  current  assets.  Management  is  confident  that  through  cash flow
generated  from  operations,   together  with  borrowings  available  under  the
revolving credit facility and the sale of select assets, all obligations will be
satisfied as they come due.

         The Company's  portfolio of  available-for-sale  securities  had a fair
market value of approximately $36.8 million at June 30, 2000,  reflecting pretax
unrealized holding gains of approximately  $6.6 million.  Included in marketable
securities  at June 30,  2000 was $23.6  million  of common  stock in a publicly
traded company which represents approximately 5.6% of such company's outstanding
shares. In April 2000, the Company purchased  1,245,000 shares of this company's
common stock. The Company's  Chairman of the Board,  Chief Executive Officer and
President  is  Chairman,  President  and a director of this  company and another
Director of the Company is also a director of this company.



                                 Page 14 of 17

<PAGE>

         Effective  December  31,  1999,  the  Company  entered  into  a  credit
agreement  with three banks which  provides for both a $60.0  million  revolving
credit facility ("Revolver") and a $1.9 million term loan ("Term Loan"). Each of
the  three  banks  participates  in the  Revolver  while  only one of the  banks
participates in the Term Loan.

         Under the Revolver, the Company will be provided with eligibility based
upon  the  sum  of  (i)  60.0%  of  the  aggregate   annualized  and  normalized
year-to-date  net  operating  income of  unencumbered  eligible  properties,  as
defined,  capitalized at 10.5%,  (ii) the lesser of $6.0 million or 60.0% of the
aggregate  annualized  and  normalized  year-to-date  net  operating  income  of
unencumbered eligible hotel properties, as defined,  capitalized at 10.5%, (iii)
the lesser of $10.0 million or 50.0% of the aggregate  annualized and normalized
year-to-date net operating income of encumbered eligible properties, as defined,
capitalized  at 12.0%,  and (iv) the lesser of $10.0 million or the sum of 75.0%
of eligible accounts receivable and 50.0% of eligible inventory,  as defined. At
June 30, 2000,  eligibility under the Revolver was $60.0 million, based upon the
above terms.  The credit agreement  contains  certain  financial and restrictive
covenants,  including  minimum  consolidated  equity,  interest  coverage,  debt
service  coverage and capital  expenditures  (other than for real  estate).  The
Company  was in  compliance  with all  covenants  at June 30,  2000.  The credit
agreement also contains provisions,  which allow the banks to perfect a security
interest in certain operating and real estate assets in the event of default, as
defined in the credit agreement. Borrowings under the Revolver, at the Company's
option,  bear  interest  at the  bank's  prime  lending  rate  or at the  London
Interbank Offered Rate ("LIBOR") plus 2.0%. The Revolver expires on December 31,
2002. At June 30, 2000, there were no amounts outstanding under the Revolver.

         The Term Loan bears  interest  at 90 day LIBOR plus 1.4% and is payable
in quarterly principal  installments of $175,000,  with the final payment due on
September  30, 2002.  At June 30,  2000,  there was  approximately  $1.6 million
outstanding on the Term Loan.

         The  Company  has an  interest-rate  swap  agreement  (the  "Swap")  to
effectively  convert its  floating  rate Term Loan to a fixed rate  basis,  thus
reducing the impact of interest rate changes on future expense.  Under the Swap,
the Company  agreed to exchange with the  counterparty  (a commercial  bank) the
difference   between  the  fixed  and  floating  rate  interest   amounts.   The
differential  to be paid or received on the Swap is recognized  over the term of
the agreement as an adjustment to interest  expense.  The fair value of the Swap
is not recognized in the financial statements.

         The Company has  undertaken  the  completion of  environmental  studies
and/or  remedial  action at Metex'  two New Jersey  facilities  and had filed an
action against certain insurance carriers seeking recovery of costs incurred and
to be incurred in these matters. Settlements have been reached with all carriers
in this  matter.  See Notes to  Consolidated  Financial  Statements  for further
discussion on this matter.

         In October  1999,  the  Company  purchased  and  retired  approximately
278,000 shares in connection  with its "Dutch Auction"  self-tender  offer. As a
result of this repurchase the Company's  additional  paid-in capital was reduced
to zero and the Company's  retained  earnings was reduced by approximately  $4.1
million.  Future  repurchases  of the  Company's  common  stock will also reduce
retained  earnings  by amounts in excess of the par value.  During the first six
months of 2000 the Company  purchased and retired 5,000 shares for approximately
$60,000.

         The cash needs of the Company have been satisfied from funds  generated
by current  operations  and  additional  borrowings.  It is expected that future
operational  cash needs and the cash required to



                                 Page 15 of 17

<PAGE>

repurchase the Company's  common stock will also be satisfied from existing cash
balances,  ongoing  operations  and borrowings  under the Revolver.  The primary
source of  capital  to fund  additional  real  estate  acquisitions  and to make
additional  high-yield mortgage loans will come from existing funds,  borrowings
under the  Revolver,  the  sale,  financing  and  refinancing  of the  Company's
properties  and from 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 Company may acquire real
properties in exchange for the issuance of the Company's equity securities.  The
Company 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.

         Repurchases  of the  Company's  common  stock will be made from time to
time in the open market at prevailing market prices and may be made in privately
negotiated transactions, subject to available resources. Funds of the Company in
excess of that needed for working capital,  purchasing real estate and arranging
financing for real estate  acquisitions are invested by the Company in corporate
equity  securities,   corporate  notes,  certificates  of  deposit,   government
securities and other financial instruments.

BUSINESS TRENDS

         Total  revenues of the Company were $31.2 million for the first half of
2000,  an  increase  of $2.3  million or 7.9% from the  comparable  1999  period
principally  due to a $1.7  million  increase  in net sales from the  engineered
products segment and an increase in rental revenues of $557,000 from real estate
operations.  Net income  during this period was $7.5  million or $1.58 per basic
share  compared  to net income of $6.2  million or $1.22 per basic share for the
same period in 1999.

         The  results of the  Company's  real estate  operations  reflect a 4.2%
increase in  revenues  for the first six months of 2000.  Operating  income from
this  segment  increased  $1.3  million  or 22.6%  over the  prior  year  period
principally due to increased rental revenues, reduced interest expense resulting
from continued  mortgage  amortization  and a reduction in real estate operating
expenses. Lower depreciation expense associated with properties sold in 2000 and
1999 also contributed favorably to this segment's operating results.

         Operating  profit  from  the  engineered   products  segment  increased
$302,000 or 31.1% compared to the corresponding  1999 period primarily due to an
11.1% increase in net sales.  This increase is the result of increased  sales in
the  engineered  products and European  automotive  markets at Metex'  Technical
Products  Division  as well  as  higher  sales  generated  by AFP  Transformers.
Management  remains  committed to growing these  businesses and has continued to
aggressively pursue new sales opportunities,  including new geographical markets
for its existing products and new applications for its core technologies.

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, which are intended to be
covered by the safe harbors  created  thereby.  All  forward-looking  statements
involve risks and uncertainties,  including without limitation, general economic


                                 Page 16 of 17

<PAGE>

conditions,  interest  rates,  competition,  potential  technology  changes  and
potential changes in customer  spending and purchasing  policies and procedures.
Although   the   Company   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 Company or any other  person
that the objectives and plans of the Company will be achieved.

PART II OTHER INFORMATION

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

On June 7, 2000,  the Company held its Annual Meeting of  Stockholders,  whereby
the  stockholders  elected  Directors  and  approved  a  proposal  to amend  the
Company's  1988  Incentive  Stock Option  Plan.  The vote on such matters was as
follows:

1.       ELECTION OF DIRECTORS:

                                          For              Withheld
                                          ---              --------
              A.F. Petrocelli           4,390,777            9,515
              Howard M. Lorber          4,390,777            9,515
              Anthony J. Miceli         4,390,777            9,515
              Arnold S. Penner          4,390,777            9,515

2.       APPROVAL OF AMENDMENTS TO THE 1988 INCENTIVE STOCK OPTION PLAN:

         To adopt  amendments  to the plan  which (i)  provide  for the grant of
         non-qualified  stock options under the plan, (ii) enable the holders of
         10% or more of the  total  combined  voting  power  of the  Company  to
         receive  non-qualified options under the plan at fair market value with
         a term of ten years and (iii)  provide  for the grant of options  under
         the plan to non-employees.

              For               Against          Abstain       Note Voted
              ---               -------          -------       ----------
            3,881,456            51,819           8,519         458,498

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 Company
has duly  caused  this  report to be signed  on its  behalf by the  undersigned,
thereunto duly authorized.

                                UNITED CAPITAL CORP.

Dated:  August 10, 2000         By: /s/Anthony J. Miceli
                                    ------------------------
                                    Anthony J. Miceli
                                    Vice President, Chief Financial Officer
                                    and Secretary of the Company


                                 Page 17 of 17