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<TITLE>	UNITED STATES SECURITIES AND EXCHANGE COMMISSIONS</TITLE>
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<B><FONT FACE="Arial"><P ALIGN="CENTER">UNITED STATES SECURITIES AND EXCHANGE
COMMISSIONS</P>
<P ALIGN="CENTER">WASHINGTON D.C. 20549</P>
<P ALIGN="CENTER">FORM 10-QSB</P>
</B></FONT><FONT SIZE=2><P ALIGN="JUSTIFY"></P>
<P ALIGN="JUSTIFY"> </P>
</FONT><P ALIGN="CENTER">QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES </P>
<P ALIGN="CENTER">EXCHANGE ACT OF 1934</P>
<P ALIGN="JUSTIFY"> </P>
<P ALIGN="CENTER">For the quarterly period ended:  September 30, 1999</P>
<P ALIGN="CENTER"> </P>
<P ALIGN="CENTER">Commission File Number:  000-27793</P>
<P ALIGN="JUSTIFY"></P>
<FONT SIZE=2><P ALIGN="JUSTIFY"> </P>
<P ALIGN="JUSTIFY"> </P>
<P ALIGN="JUSTIFY"> </P>
</FONT><B><FONT FACE="Arial"><P ALIGN="CENTER">ELECTRONIC SYSTEMS TECHNOLOGY,
INC.</P>
</B></FONT><P ALIGN="CENTER">(Exact name of registrant as specified in its
charter)</P>
<P ALIGN="JUSTIFY"></P>
<P ALIGN="CENTER"> </P>
<P ALIGN="CENTER"><CENTER><TABLE BORDER CELLSPACING=1 CELLPADDING=7 WIDTH=516>
<TR><TD WIDTH="48%" VALIGN="TOP">
<P ALIGN="CENTER">Washington</TD>
<TD WIDTH="52%" VALIGN="TOP">
<P ALIGN="CENTER">91-1238077</TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="TOP">
<P ALIGN="CENTER">(State of Incorporation)</TD>
<TD WIDTH="52%" VALIGN="TOP">
<P ALIGN="CENTER">(I.R.S. Employer Identification No.)</TD>
</TR>
</TABLE>
</CENTER></P>

<P ALIGN="CENTER"></P>
<P> </P>
<P ALIGN="CENTER">    </P>
<P ALIGN="CENTER"><CENTER><TABLE BORDER CELLSPACING=1 CELLPADDING=7 WIDTH=468>
<TR><TD WIDTH="59%" VALIGN="TOP">
<P ALIGN="CENTER">415 N. Quay St., #4  Kennewick   WA</TD>
<TD WIDTH="41%" VALIGN="TOP">
<P ALIGN="CENTER"> 99336 </TD>
</TR>
<TR><TD WIDTH="59%" VALIGN="TOP">
<P ALIGN="CENTER">(Address of Principal executive offices)</TD>
<TD WIDTH="41%" VALIGN="TOP">
<P ALIGN="CENTER">(ZIP Code)</TD>
</TR>
</TABLE>
</CENTER></P>

<P ALIGN="CENTER"></P>
<P ALIGN="JUSTIFY"> </P>
<P> </P>
<P ALIGN="CENTER"><CENTER><TABLE BORDER CELLSPACING=1 CELLPADDING=7 WIDTH=462>
<TR><TD VALIGN="TOP">
<P ALIGN="CENTER">Registrant's telephone number, including area code: (509) 735-
9092<U> </U></TD>
</TR>
</TABLE>
</CENTER></P>

<P ALIGN="JUSTIFY"></P>
<P ALIGN="JUSTIFY"> </P>
<P ALIGN="JUSTIFY"> </P>
<P ALIGN="JUSTIFY">Check whether the issuer (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months
(or for such shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing requirements for the past 90
days.  Yes [ X ]    No [   ]   </P>
<P ALIGN="JUSTIFY"></P>
<P ALIGN="JUSTIFY"> </P>
<P ALIGN="JUSTIFY">The number of shares outstanding of common stock as of
September 30, 1999 was 4,953,667.</P>
<FONT SIZE=2><P ALIGN="JUSTIFY"></P>
<P ALIGN="CENTER"> </P>
</FONT><B><FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">PART I - FINANCIAL
INFORMATION</P>
<P ALIGN="JUSTIFY"></P>
<P>Item 1.  FINANCIAL STATEMENTS.</P>
</B></FONT><FONT SIZE=2><P ALIGN="JUSTIFY"></P>
</FONT><B><FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">ELECTRONIC SYSTEMS
TECHNOLOGY, INC.</P>
</B></FONT><FONT SIZE=2><P ALIGN="CENTER">(as prepared by Management)</P>
<P ALIGN="CENTER">(Unaudited)</P>
<P ALIGN="CENTER"></P>
<P ALIGN="CENTER">SELECTED FINANCIAL DATA</P>
<P ALIGN="CENTER"></P></FONT>
<TABLE BORDER CELLSPACING=1 CELLPADDING=7 WIDTH=734>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Nine months ended </FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">Sept 30</P>
<P ALIGN="CENTER">1999</P>
<P ALIGN="CENTER">==========</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">Sept 30</P>
<P ALIGN="CENTER">1998</P>
<P ALIGN="CENTER">==========</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Sales</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$   787,377</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$    967,678</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Other revenue</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">136,670</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">106,542</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Gross profit</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">378,596</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">516,931</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Net Income (Loss) Before Taxes</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">(      18,864)</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">124,384</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Net Income (Loss) After Taxes</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">(      12,451)</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">82,093</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Earnings (Loss) Per Share Before Taxes </FONT></TD>
<TD WIDTH="33%" VALIGN="TOP"> </TD>
<TD WIDTH="33%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Basic</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$(          0.004)</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$            .02</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Diluted</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">(          0.004)</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">.02</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Earnings (Loss) Per Share After Taxes</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP"> </TD>
<TD WIDTH="33%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Basic</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$ (          0.003)</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$           .01</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Diluted</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">(          0.003)</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">.01</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Weighted Average Shares Outstanding (Basic)</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP"> </TD>
<TD WIDTH="33%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Primary</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">5,553,941</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">5,567,612</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Diluted</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">5,553,941</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">5,567,612</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Total assets</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$2,244,301</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$2,234,403</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Long-term debt and capital lease obligations</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$           -0-</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$           -0-</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Shareholders' equity</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$2,180,000</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$2,161,155</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Shareholders' equity  per share</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$         0.44</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$         0.44</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Working Capital</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$2,014,620</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$2,009,116</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Current ratio</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">32:1</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">28:1</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Equity to total assets</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">97%</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">97%</FONT></TD>
</TR>
</TABLE>

<FONT SIZE=2><P ALIGN="CENTER"></P>
</FONT><B><FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">ELECTRONIC SYSTEMS
TECHNOLOGY, INC.</P>
<P ALIGN="CENTER">BALANCE SHEET</P>
</B></FONT><FONT SIZE=2><P ALIGN="CENTER">(as prepared by Management)</P>
<P ALIGN="CENTER">(Unaudited)</P>
<P>	</P></FONT>
<TABLE BORDER CELLSPACING=1 CELLPADDING=7 WIDTH=550>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>ASSETS</FONT></TD>
<TD WIDTH="28%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">September 30</P>
<P ALIGN="CENTER">1999</P>
<P ALIGN="CENTER">-----------------</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">December 31</P>
<P ALIGN="CENTER">1998</P>
<P ALIGN="CENTER">----------------</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>CURRENT ASSETS</FONT></TD>
<TD WIDTH="28%" VALIGN="TOP"> </TD>
<TD WIDTH="33%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>  Cash and cash equivalents</FONT></TD>
<TD WIDTH="28%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$1,450,176</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$1,426,381</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>  Accounts receivable, net of allowance for       uncollectibles
of $1,284</FONT></TD>
<TD WIDTH="28%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">194,094</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">381,386</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>  Inventory</FONT></TD>
<TD WIDTH="28%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">388,014</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">385,365</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>  Accrued interest</FONT></TD>
<TD WIDTH="28%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">   4,845</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">   7,888</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>  Prepaid expenses</FONT></TD>
<TD WIDTH="28%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER"> 18,891</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">   5,202</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>  Provision for Federal Income Taxes</FONT></TD>
<TD WIDTH="28%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER"> 22,414</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">           0</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>  Deferred Tax Asset</FONT></TD>
<TD WIDTH="28%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">            487</P>
<P ALIGN="CENTER">       --------------</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">             487</P>
<P ALIGN="CENTER">          --------------</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>  Total Current Assets</FONT></TD>
<TD WIDTH="28%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$2,078,921</P>
<P ALIGN="CENTER">---------------</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$   2,206,709</P>
<P ALIGN="CENTER">    --------------</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P> </FONT></TD>
<TD WIDTH="28%" VALIGN="TOP"> </TD>
<TD WIDTH="33%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>  PROPERTY & EQUIPMENT, net of depreciation of $269,927 at
Sept. 30, 1999 and $246,122 at Dec. 31, 1998 </FONT></TD>
<TD WIDTH="28%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">154,931</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">112,314</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>  </FONT></TD>
<TD WIDTH="28%" VALIGN="TOP"> </TD>
<TD WIDTH="33%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>OTHER ASSETS</FONT></TD>
<TD WIDTH="28%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">10,449</P>
<P ALIGN="CENTER">--------------</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">35,122</P>
<P ALIGN="CENTER">--------------</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP"> </TD>
<TD WIDTH="28%" VALIGN="TOP"> </TD>
<TD WIDTH="33%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>TOTAL ASSETS</FONT></TD>
<TD WIDTH="28%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$2,244,301</P>
<P ALIGN="CENTER">========</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$2,354,145</P>
<P ALIGN="CENTER">========</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP"> </TD>
<TD WIDTH="28%" VALIGN="TOP"> </TD>
<TD WIDTH="33%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>LIABILITIES AND STOCKHOLDERS' EQUITY</FONT></TD>
<TD WIDTH="28%" VALIGN="TOP"> </TD>
<TD WIDTH="33%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>CURRENT LIABILITIES</FONT></TD>
<TD WIDTH="28%" VALIGN="TOP"> </TD>
<TD WIDTH="33%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>  Accounts payable</FONT></TD>
<TD WIDTH="28%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$     43,740</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$     52,386</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>  Federal Income Taxes Payable</FONT></TD>
<TD WIDTH="28%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">0</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">14,510</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>  Accrued Liabilities</FONT></TD>
<TD WIDTH="28%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">20,561</P>
<P ALIGN="CENTER">--------------</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">20,244</P>
<P ALIGN="CENTER">--------------</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>Total Current Liabilities</FONT></TD>
<TD WIDTH="28%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$     64,301</P>
<P ALIGN="CENTER">--------------</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$     87,140</P>
<P ALIGN="CENTER">--------------</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>DEFERRED INCOME</FONT></TD>
<TD WIDTH="28%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">0</P>
<P ALIGN="CENTER">--------------</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">25,017</P>
<P ALIGN="CENTER">--------------</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P> STOCKHOLDERS' EQUITY</FONT></TD>
<TD WIDTH="28%" VALIGN="TOP"> </TD>
<TD WIDTH="33%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>Common stock, $.001 par value50,000,000 shares authorized,</P>
<P>shares issued and outstanding:</P>
<P>4,953,667-December 31, 1998</P>
<P>and September 30, 1999</FONT></TD>
<TD WIDTH="28%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$       4,954</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$       4,954</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>Additional paid-in capital</FONT></TD>
<TD WIDTH="28%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">894,129</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">894,129</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>Retained earnings</FONT></TD>
<TD WIDTH="28%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">1,280,917</P>
<P ALIGN="CENTER">--------------</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">1,342,905</P>
<P ALIGN="CENTER">--------------</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP"> </TD>
<TD WIDTH="28%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$2,180,000</P>
<P ALIGN="CENTER">--------------</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$2,241,988</P>
<P ALIGN="CENTER">--------------</FONT></TD>
</TR>
<TR><TD WIDTH="38%" VALIGN="TOP">
<FONT SIZE=2><P>TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY</FONT></TD>
<TD WIDTH="28%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$2,244,301</P>
<P ALIGN="CENTER">========</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$2,354,145</P>
<P ALIGN="CENTER">========</FONT></TD>
</TR>
</TABLE>

<FONT SIZE=2>
<P>(See "Notes to Financial Statements")</P>
<P ALIGN="CENTER"></P>
</FONT><B><FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">ELECTRONIC SYSTEMS
TECHNOLOGY, INC.</P>
<P ALIGN="CENTER">STATEMENT OF OPERATIONS</P>
</B></FONT><FONT SIZE=2><P ALIGN="CENTER">(as prepared by Management)</P>
<P ALIGN="CENTER">(Unaudited)</P>
<P>	</P></FONT>
<TABLE BORDER CELLSPACING=1 CELLPADDING=7 WIDTH=734>
<TR><TD WIDTH="42%" VALIGN="TOP"> </TD>
<TD WIDTH="29%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="CENTER">Three Months Ended</FONT></TD>
<TD WIDTH="29%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="CENTER">Nine Months Ended</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP"> </TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">Sept 30</P>
<P ALIGN="CENTER">1999</P>
<P ALIGN="CENTER">--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">Sept 30</P>
<P ALIGN="CENTER">1998</P>
<P ALIGN="CENTER">--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">Sept 30</P>
<P ALIGN="CENTER">1999</P>
<P ALIGN="CENTER">--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">Sept 30</P>
<P ALIGN="CENTER">1998</P>
<P ALIGN="CENTER">--------------</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>SALES</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$  275,891</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$  250,562</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$  787,377</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$  967,678</P>
<P>--------------</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>COST OF SALES</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>Beginning Inventory</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$ 417,514</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$ 339,688</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$  385,365</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$  319,127</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>Purchases & Allocated Costs</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>109,559</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>185,912</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>411,430</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>537,336</P>
<P>--------------</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP"> </TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$ 527,073</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$ 525,600</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$  796,795</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$  856,463</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>Ending Inventory</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>388,014</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>405,716</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>388,014</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>405,716</P>
<P>--------------</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>Total Cost of Sales</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$ 139,059</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$ 119,884</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$  408,781</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$  450,747</P>
<P>--------------</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>GROSS PROFIT</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$ 136,832</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$ 130,678</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$  378,596</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$  516,931</P>
<P>--------------</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>OPERATING EXPENSES</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>Finance/Administration</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$   35,047</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$  32,227</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$  142,228</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$  142,120</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>Research & Development</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>35,404</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>28,358</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>119,815</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>101,689</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>Marketing</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>48,277</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>59,154</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>155,234</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>159,970</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>Customer Service</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>12,276</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>16,621</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>44,780</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>48,754</P>
<P>--------------</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>Total Operating Expenses</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$  131,004</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$ 136,360</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$  462,057</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$  452,533</P>
<P>--------------</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>OPERATING INCOME (LOSS)</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$     5,828</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$ (  5,682)</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$(   83,461)</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$   64,398</P>
<P>--------------</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>OTHER INCOME (EXPENSES)</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>Interest Income</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$  14,331</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$  18,760</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$   44,398</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$   54,398</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>Recovery from Mktble Sec. Litigation</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>0</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>562</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>0</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>2,210</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>Engineering Services</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>31,153</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>19,471</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>92,272</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>49,934</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>Engineering Support</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>(   17,575)</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>(   18,237)</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P> (   72,074)</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>(    46,556)</P>
<P>--------------</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>Net Other Income</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$  27,909</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$  20,556</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$   64,596</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$   59,986</P>
<P>--------------</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>NET INCOME (LOSS) BEFORE TAX</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$  33,737</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$  14,874</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$(  18,865)</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$  124,384</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>Provision for income tax</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>(  11,471)</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>5,057</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>6,414</P>
<P>--------------</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>42,291</P>
<P>--------------</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>NET INCOME</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$  22,266</P>
<P>========</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$    9,817</P>
<P>========</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$(   12,451)</P>
<P>========</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$   82,093</P>
<P>========</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>Basic Earnings (Loss) per Share </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>Before Tax</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$   0.006</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$     0.003</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$(    0.004)</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$        0.02</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>Basic Earnings (Loss)per Share </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>After Tax</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$   0.004</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$     0.002</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$(    0.003)</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$        0.01</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>Diluted Earnings (Loss) Per Share </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>Before Tax</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$   0.006</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$     0.003</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$(    0.004)</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$        0.02</FONT></TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>Diluted Earnings (Loss) Per Share    </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
<TD WIDTH="14%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="42%" VALIGN="TOP">
<FONT SIZE=2><P>After Tax</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$   0.004</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$     0.002</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$(    0.003)</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP">
<FONT SIZE=2><P>$        0.01</FONT></TD>
</TR>
</TABLE>

<FONT SIZE=2>
<P> </P>
<P ALIGN="CENTER">(See "Notes to Financial Statements)</P>
<P ALIGN="CENTER"></P>
</FONT><B><FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">ELECTRONIC SYSTEMS
TECHNOLOGY, INC.</P>
<P ALIGN="CENTER">STATEMENT OF CASH FLOWS</P>
</B></FONT><FONT SIZE=2><P ALIGN="CENTER">(as prepared by Management)</P>
<P ALIGN="CENTER">(Unaudited)</P>
<P>                                            </P>
</FONT>
<TABLE BORDER CELLSPACING=1 CELLPADDING=7 WIDTH=595>
<TR><TD WIDTH="49%" VALIGN="TOP">
<FONT SIZE=2><P>NINE MONTHS ENDED</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">September 30</P>
<P ALIGN="CENTER">1999</P>
<P ALIGN="CENTER">----------------</FONT></TD>
<TD WIDTH="29%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">September 30</P>
<P ALIGN="CENTER">1998</P>
<P ALIGN="CENTER">----------------</FONT></TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<FONT SIZE=2><P>CASH FLOWS PROVIDED (USED) IN</P>
<P>OPERATING ACTIVITIES:</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP"> </TD>
<TD WIDTH="29%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<FONT SIZE=2><P>Net income</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$  (   12,451)</FONT></TD>
<TD WIDTH="29%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$   82,093</FONT></TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<FONT SIZE=2><P>Noncash expenses included in income:</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP"> </TD>
<TD WIDTH="29%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<FONT SIZE=2><P>Depreciation</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">23,805</FONT></TD>
<TD WIDTH="29%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">23,529</FONT></TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<FONT SIZE=2><P>Amortization</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">2,148</FONT></TD>
<TD WIDTH="29%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">1,935</FONT></TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<FONT SIZE=2><P>Provision for Federal Income Taxes</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">(   22,414)</FONT></TD>
<TD WIDTH="29%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">0</FONT></TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP"> </TD>
<TD WIDTH="22%" VALIGN="TOP"> </TD>
<TD WIDTH="29%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<FONT SIZE=2><P>Decrease (Increase) in Current Assets:</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP"> </TD>
<TD WIDTH="29%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<FONT SIZE=2><P>Accounts receivable, net</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">187,292</FONT></TD>
<TD WIDTH="29%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">109,322</FONT></TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<FONT SIZE=2><P>Inventory</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">(     2,649)</FONT></TD>
<TD WIDTH="29%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">(      86,589)</FONT></TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<FONT SIZE=2><P>Prepaid income taxes</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">0</FONT></TD>
<TD WIDTH="29%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">(       3,309)</FONT></TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<FONT SIZE=2><P>Prepaid expenses</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">(   13,689)</FONT></TD>
<TD WIDTH="29%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">(     16,302)</FONT></TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<FONT SIZE=2><P>Accrued interest</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">3,043</FONT></TD>
<TD WIDTH="29%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">(       1,289)</FONT></TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP"> </TD>
<TD WIDTH="22%" VALIGN="TOP"> </TD>
<TD WIDTH="29%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<FONT SIZE=2><P>Increase (Decrease) in Current Liabilities:</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP"> </TD>
<TD WIDTH="29%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<FONT SIZE=2><P>Accounts payable, accrued expenses </P>
<P>and other current liabilities</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">(     8,329)</FONT></TD>
<TD WIDTH="29%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">20,828</FONT></TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<FONT SIZE=2><P>Accrued federal income taxes</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">(   14,510)</FONT></TD>
<TD WIDTH="29%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">(     24,793)</FONT></TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<FONT SIZE=2><P>Deferred Income     </FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">                (    25,017)</P>
<P ALIGN="CENTER">                   -------------</FONT></TD>
<TD WIDTH="29%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">                          0</P>
<P ALIGN="CENTER">                  -------------</FONT></TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP"> </TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$ 117,229</P>
<P ALIGN="CENTER">-------------</FONT></TD>
<TD WIDTH="29%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$  105,425</P>
<P ALIGN="CENTER">-------------</FONT></TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<FONT SIZE=2><P>CASH FLOWS PROVIDED (USED) IN</P>
<P>INVESTING ACTIVITIES:</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP"> </TD>
<TD WIDTH="29%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<FONT SIZE=2><P>Additions to property and equipment</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$(  66,422)</FONT></TD>
<TD WIDTH="29%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$(  10,920)</FONT></TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<FONT SIZE=2><P>Additions to capitalized software</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">(3,725)</FONT></TD>
<TD WIDTH="29%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">0</FONT></TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<FONT SIZE=2><P>Additions to deposits for construction of case die</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">0</FONT></TD>
<TD WIDTH="29%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">(  26,250)</FONT></TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<FONT SIZE=2><P>Deposits; application of mold deposit to property</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">26,250</P>
<P ALIGN="CENTER">--------------</FONT></TD>
<TD WIDTH="29%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">0</P>
<P ALIGN="CENTER">--------------</FONT></TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP"> </TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$(  43,897)</P>
<P ALIGN="CENTER">--------------</FONT></TD>
<TD WIDTH="29%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$ (  37,170)</P>
<P ALIGN="CENTER">--------------</FONT></TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<FONT SIZE=2><P>CASH FLOWS PROVIDED (USED) IN</P>
<P>FINANCING ACTIVITIES:</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP"> </TD>
<TD WIDTH="29%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<FONT SIZE=2><P>Payment of Cash Distribution</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$(  49,537)</P>
<P ALIGN="CENTER">-------------</FONT></TD>
<TD WIDTH="29%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$(   49,537)</P>
<P ALIGN="CENTER">-------------</FONT></TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP"> </TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$(  49,537)</P>
<P ALIGN="CENTER">-------------</FONT></TD>
<TD WIDTH="29%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$(   49,537)</P>
<P ALIGN="CENTER">-------------</FONT></TD>
</TR>
</TABLE>

<FONT SIZE=2><P>(See "Notes to Financial Statements)</P>
<P ALIGN="CENTER"></P>
</FONT><B><FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">ELECTRONIC SYSTEMS
TECHNOLOGY, INC.</P>
<P ALIGN="CENTER">STATEMENT OF CASH FLOWS</P>
</B></FONT><FONT SIZE=2><P ALIGN="CENTER">(continued)</P>
<P ALIGN="CENTER">(as prepared by Management)</P>
<P ALIGN="CENTER">(Unaudited)</P>
<P>	</P></FONT>
<TABLE BORDER CELLSPACING=1 CELLPADDING=7 WIDTH=697>
<TR><TD WIDTH="44%" VALIGN="TOP"> </TD>
<TD WIDTH="56%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="CENTER">Nine Months Ended</FONT></TD>
</TR>
<TR><TD WIDTH="44%" VALIGN="TOP"> </TD>
<TD WIDTH="26%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">September 30</P>
<P ALIGN="CENTER">1999</P>
<P ALIGN="CENTER">-----------------</FONT></TD>
<TD WIDTH="30%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">September 30</P>
<P ALIGN="CENTER">1998</P>
<P ALIGN="CENTER">----------------</FONT></TD>
</TR>
<TR><TD WIDTH="44%" VALIGN="TOP">
<FONT SIZE=2><P>Net increase in cash and cash equivalents</FONT></TD>
<TD WIDTH="26%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$     23,795</FONT></TD>
<TD WIDTH="30%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$     18,718</FONT></TD>
</TR>
<TR><TD WIDTH="44%" VALIGN="TOP">
<FONT SIZE=2><P>Cash and cash equivalents at beginning of period</FONT></TD>
<TD WIDTH="26%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">1,426,381</P>
<P ALIGN="CENTER">--------------</FONT></TD>
<TD WIDTH="30%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">1,466,760</P>
<P ALIGN="CENTER">--------------</FONT></TD>
</TR>
<TR><TD WIDTH="44%" VALIGN="TOP">
<FONT SIZE=2><P>Cash and Cash equivalents at ending of period</FONT></TD>
<TD WIDTH="26%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$1,450,176</P>
<P ALIGN="CENTER">========</FONT></TD>
<TD WIDTH="30%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$ 1,485,478</P>
<P ALIGN="CENTER">========</FONT></TD>
</TR>
<TR><TD WIDTH="44%" VALIGN="TOP">
<FONT SIZE=2><P>SUPPLEMENTAL DISCLOSURES OF CASH FLOWS</P>
<P>INFORMATION:</FONT></TD>
<TD WIDTH="26%" VALIGN="TOP"> </TD>
<TD WIDTH="30%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="44%" VALIGN="TOP">
<FONT SIZE=2><P>Cash paid year to date:</FONT></TD>
<TD WIDTH="26%" VALIGN="TOP"> </TD>
<TD WIDTH="30%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="44%" VALIGN="TOP">
<FONT SIZE=2><P>Interest</FONT></TD>
<TD WIDTH="26%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$              0</FONT></TD>
<TD WIDTH="30%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$              0</FONT></TD>
</TR>
<TR><TD WIDTH="44%" VALIGN="TOP">
<FONT SIZE=2><P>Income taxes</FONT></TD>
<TD WIDTH="26%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">30,510</P>
<P ALIGN="CENTER">========</FONT></TD>
<TD WIDTH="30%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">45,600</P>
<P ALIGN="CENTER">========</FONT></TD>
</TR>
<TR><TD WIDTH="44%" VALIGN="TOP">
<FONT SIZE=2><P>Cash and Cash Equivalents:</FONT></TD>
<TD WIDTH="26%" VALIGN="TOP"> </TD>
<TD WIDTH="30%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="44%" VALIGN="TOP">
<FONT SIZE=2><P>Cash</FONT></TD>
<TD WIDTH="26%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$       6,650</FONT></TD>
<TD WIDTH="30%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$       6,639</FONT></TD>
</TR>
<TR><TD WIDTH="44%" VALIGN="TOP">
<FONT SIZE=2><P>Money market accounts</FONT></TD>
<TD WIDTH="26%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">628,962</FONT></TD>
<TD WIDTH="30%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">387,498</FONT></TD>
</TR>
<TR><TD WIDTH="44%" VALIGN="TOP">
<FONT SIZE=2><P>Certificates of Deposit</FONT></TD>
<TD WIDTH="26%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">814,564</FONT></TD>
<TD WIDTH="30%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">455,210</FONT></TD>
</TR>
<TR><TD WIDTH="44%" VALIGN="TOP">
<FONT SIZE=2><P>Commercial paper</FONT></TD>
<TD WIDTH="26%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">0</P>
<P ALIGN="CENTER">--------------</FONT></TD>
<TD WIDTH="30%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">636,131</P>
<P ALIGN="CENTER">--------------</FONT></TD>
</TR>
<TR><TD WIDTH="44%" VALIGN="TOP"> </TD>
<TD WIDTH="26%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$1,450,176</P>
<P ALIGN="CENTER">========</FONT></TD>
<TD WIDTH="30%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$1,485,478</P>
<P ALIGN="CENTER">========</FONT></TD>
</TR>
</TABLE>

<FONT SIZE=2><P> (See "Notes to Financial Statements)</P>

<P ALIGN="CENTER"> </P>
</FONT><B><FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">ELECTRONIC SYSTEMS
TECHNOLOGY, INC.</P>
<P ALIGN="CENTER"></P>
<P ALIGN="CENTER">NOTES TO FINANCIAL STATEMENTS</P>
</B></FONT><FONT SIZE=2><P ALIGN="CENTER"> (as prepared by Management)</P>
<P ALIGN="CENTER"> (Unaudited)</P>
<P>	</P>
</FONT><B><FONT FACE="Arial" SIZE=2><P>NOTE 1 - BASIS OF PRESENTATION </P>
</B></FONT><FONT SIZE=2>
<P>The financial statements of Electronic Systems Technology, Inc. (the <FONT
FACE="Symbol">2</FONT>
Company<FONT FACE="Symbol">2</FONT>
), presented in this Form 10Q are unaudited and reflect, in the opinion of
Management, a fair presentation of operations for the three and nine month
periods ended September 30, 1999 and September 30, 1998.  Certain information
and footnote disclosure normally included in financial statements prepared in
accordance with generally accepted accounting principles have been condensed or
omitted pursuant to the applicable rules and regulations of the Securities and
Exchange Commission.  In preparation of the financial statements, certain
amounts and balances have been restated from previously filed reports to conform
to the format of the 1999 presentation.  These financial statements should be
read in conjunction with the audited financial statements and notes thereto
included in the Company's Form 10K for the year ended December 31, 1998 as filed
with the Securities and Exchange Commission.</P>

<P>The results of operation for the three and nine month periods ended September
30, 1999 and September 30, 1998, are not necessarily indicative of the results
expected for the full fiscal year or for any other fiscal period.</P>

<P>The Company does not have other revenues, expenses, gains and losses that
require disclosure under SFAS No. 130 as other comprehensive income.</P>

</FONT><B><FONT FACE="Arial" SIZE=2><P>NOTE 2 - INVENTORIES</P>
</B></FONT><FONT SIZE=2>
<P>Inventories are stated at lower of cost or market with cost determined using
the FIFO (first in, first out) method.  Inventories consist of the
following:</P>
<P>	</P></FONT>
<TABLE BORDER CELLSPACING=1 CELLPADDING=7 WIDTH=361>
<TR><TD WIDTH="29%" VALIGN="TOP"> </TD>
<TD WIDTH="40%" VALIGN="TOP">
<FONT SIZE=2><P>September 30</P>
<P>1999</P>
<P>----------------</FONT></TD>
<TD WIDTH="32%" VALIGN="TOP">
<FONT SIZE=2><P>December 31</P>
<P>1998</P>
<P>----------------</FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP">
<FONT SIZE=2><P>Parts</FONT></TD>
<TD WIDTH="40%" VALIGN="TOP">
<FONT SIZE=2><P>$  287,321</FONT></TD>
<TD WIDTH="32%" VALIGN="TOP">
<FONT SIZE=2><P>$  229,903</FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP">
<FONT SIZE=2><P>Work in progress</FONT></TD>
<TD WIDTH="40%" VALIGN="TOP">
<FONT SIZE=2><P>--</FONT></TD>
<TD WIDTH="32%" VALIGN="TOP">
<FONT SIZE=2><P>--</FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP">
<FONT SIZE=2><P>Finished goods</FONT></TD>
<TD WIDTH="40%" VALIGN="TOP">
<FONT SIZE=2><P>100,693</P>
<P>----------------</FONT></TD>
<TD WIDTH="32%" VALIGN="TOP">
<FONT SIZE=2><P>155,462</P>
<P>----------------</FONT></TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP"> </TD>
<TD WIDTH="40%" VALIGN="TOP">
<FONT SIZE=2><P>$  388,014</P>
<P>=========</FONT></TD>
<TD WIDTH="32%" VALIGN="TOP">
<FONT SIZE=2><P>$   385,365</P>
<P>=========</FONT></TD>
</TR>
</TABLE>

<FONT SIZE=2>
</FONT><B><FONT FACE="Arial" SIZE=2><P ALIGN="JUSTIFY">NOTE 3 - EARNINGS (LOSS)
PER SHARE </P>
<P ALIGN="JUSTIFY"></P>
</B></FONT><FONT SIZE=3><P ALIGN="JUSTIFY">Basic and diluted loss per share for
the nine month period ended September  30, 1999, is computed by dividing loss by
the number of common shares outstanding for the period, excluding equivalent
shares from possible stock option exercises, the effect of which would be anti-
dilutive. The number of common shares outstanding used for calculation of basic
and diluted loss per share was 4,953,667 for the nine month period ended
September 30, 1999.</P>
<P ALIGN="JUSTIFY"></P>
<P ALIGN="JUSTIFY">Basic Earnings Per Share (EPS) excludes dilution and is
computed by dividing income available to common stockholders by the weighted-
average number of common shares outstanding for the period.  Diluted EPS
reflects potential dilution occurring if securities or other contracts to issue
common stock were exercised or converted into common stock or resulted in the
issuance of common stock that then shared in the earnings of the Company.  The
primary weighted average number of common shares outstanding was 5,553,941 and
</FONT>5,567,612<FONT SIZE=3> for the quarters ended September 30, 1999 and 1998
respectively.</P>
<P ALIGN="JUSTIFY">	</P></FONT>
<TABLE BORDER CELLSPACING=1 CELLPADDING=7 WIDTH=559>
<TR><TD VALIGN="TOP" COLSPAN=4>
<FONT SIZE=3><P ALIGN="CENTER">For the Quarter Ended  September 30,
1999</FONT></TD>
</TR>
<TR><TD WIDTH="22%" VALIGN="TOP"> </TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=3><P ALIGN="CENTER">Income</P>
<P ALIGN="CENTER">(Numerator)</P>
<P ALIGN="CENTER">-------------------</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=3><P ALIGN="CENTER">Shares</P>
<P ALIGN="CENTER">(Denominator)</P>
<P ALIGN="CENTER">-------------------</FONT></TD>
<TD WIDTH="34%" VALIGN="TOP">
<FONT SIZE=3><P ALIGN="CENTER">Per-Share</P>
<P ALIGN="CENTER">Amount</P>
<P ALIGN="CENTER">-------------------</FONT></TD>
</TR>
<TR><TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=3><P ALIGN="JUSTIFY">Basic EPS</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP"> </TD>
<TD WIDTH="22%" VALIGN="TOP"> </TD>
<TD WIDTH="34%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="22%" VALIGN="TOP" HEIGHT=51>
<FONT SIZE=3><P ALIGN="JUSTIFY">Income available to common</P>
<P ALIGN="JUSTIFY">Stockholders</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP" HEIGHT=51>
<FONT SIZE=3><P ALIGN="CENTER">$22,266</P>
<P ALIGN="CENTER">===========</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP" HEIGHT=51>
<FONT SIZE=3><P ALIGN="CENTER">5,553,941</P>
<P ALIGN="CENTER">===========</FONT></TD>
<TD WIDTH="34%" VALIGN="TOP" HEIGHT=51>
<FONT SIZE=3><P ALIGN="CENTER">$0.004</P>
<P ALIGN="CENTER">===========</FONT></TD>
</TR>
<TR><TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=3><P ALIGN="JUSTIFY">Diluted EPS</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP"> </TD>
<TD WIDTH="22%" VALIGN="TOP"> </TD>
<TD WIDTH="34%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="22%" VALIGN="TOP" HEIGHT=86>
<FONT SIZE=3><P ALIGN="JUSTIFY">Income available to common</P>
<P ALIGN="JUSTIFY">stockholders + assumed conversions</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP" HEIGHT=86>
<FONT SIZE=3><P ALIGN="CENTER">$22,266</P>
<P ALIGN="CENTER">===========</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP" HEIGHT=86>
<FONT SIZE=3><P ALIGN="CENTER">5,593,667</P>
<P ALIGN="CENTER">===========</FONT></TD>
<TD WIDTH="34%" VALIGN="TOP" HEIGHT=86>
<FONT SIZE=3><P ALIGN="CENTER">$0.004</P>
<P ALIGN="CENTER">===========</FONT></TD>
</TR>
</TABLE>

<B><FONT FACE="Arial" SIZE=2><P ALIGN="JUSTIFY"></P>
<P>NOTE 4 - STOCK OPTIONS</P>
</B></FONT><FONT SIZE=2><P ALIGN="JUSTIFY"></P>
</FONT><FONT SIZE=3><P ALIGN="JUSTIFY">As of September 30, 1999, the Company had
outstanding stock options which have been granted periodically to individual
employees and directors with no less than three years of continuous tenure with
Company. On February 12, 1999, additional stock options to purchase shares of
the Company's common stock were granted to individual employees and directors
with no less than three years continuous tenure.  The options granted on
February 12, 1999 totaled 225,000 shares under option and have an exercise price
of $0.44 per share. The options granted on February 12, 1999 may be exercised
any time during the period from February 12, 1999 through February 11, 2002.
The Company's Form 8-K dated February 12, 1999, as filed with the Securities and
Exchange Commission is included herein by reference.  All outstanding stock
options must be exercised within 90 days after termination of employment.
During the 12 month period from September 30, 1998 to September 30, 1999,
215,000 shares under option expired, no shares under option were exercised, and
215,000 shares under option were granted.  At September 30, 1999 there were
640,000 shares under option reserved for future exercises.</P>
<P ALIGN="JUSTIFY"></P>
<P ALIGN="JUSTIFY">The Company has adopted the disclosure-only provisions of
Statement of Financial Accounting Standards (SFAS) No. 123, "Accounting for
Stock-Based Compensation." The Company undertakes to make disclosures and
calculations pursuant to SFAS 123 on an annual basis coinciding with the
issuance of the Company's Annual Financial Statements. Accordingly, no
compensation cost has been recognized for the stock option plan. </P>
</FONT><FONT SIZE=2><P ALIGN="JUSTIFY"></P>
</FONT><B><FONT FACE="Arial" SIZE=2><P>NOTE 5 - RELATED PARTY TRANSACTIONS</P>
</B></FONT><FONT SIZE=2>
</FONT><FONT SIZE=3><P>For the nine-month period ended September 30, 1999
services in the amount of $30,654 were contracted with Manufacturing Services,
Inc., of which the owner/president is a member of the Board of Directors of the
Company.  </P>
</FONT><FONT SIZE=2>
</FONT><B><FONT FACE="Arial" SIZE=2><P ALIGN="JUSTIFY">NOTE 6 - CASH
DISTRIBUTION</P>
</B></FONT><FONT SIZE=2><P ALIGN="JUSTIFY"></P>
</FONT><FONT SIZE=3><P ALIGN="JUSTIFY">On June 11, 1999, the Company declared a
one-time, non-cumulative, cash distribution to shareholders of record as of June
25, 1999, of $0.01 per share of common stock, with a payable date of July 9,
1999.  The payment of the cash distribution was completed by July 9, 1999 for a
total dollar value of $49,537.  For the quarter ended September 30, 1999, the
Company had met all cash distribution obligations and no longer recognized
current liabilities previously recorded for the cash distribution.  The
Company's Form 8-K dated June 11, 1999, as filed with the Securities and
Exchange Commission is included herein by reference.</P>
</FONT><FONT SIZE=2><P ALIGN="CENTER"></P>
</FONT><B><FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">ITEM II</P>
<P ALIGN="CENTER">MANGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL</P>
<P ALIGN="CENTER">CONDITION AND RESULTS OF OPERATION</P>
</B></FONT><FONT SIZE=2>
</FONT><I><FONT SIZE=3><P>Management's discussion and analysis is intended to be
read in conjunction with the company's unaudited financial statements and the
integral notes thereto for the quarter ending September 30, 1999.  The following
statements may be forward looking in nature and actual results may differ
materially.</P>
</I></FONT><FONT SIZE=1>
</FONT><B><FONT FACE="Arial" SIZE=2><P>A.	RESULTS OF OPERATIONS</P>
</FONT><FONT FACE="Arial" SIZE=1>
</FONT><FONT FACE="Arial" SIZE=2><P>REVENUES:</P>
</B></FONT><FONT SIZE=1>
</FONT><FONT SIZE=3><P ALIGN="JUSTIFY">Total revenues from the sale of the
Company's ESTeem<FONT FACE="Symbol">Ô</FONT>
 wireless modem systems, accessories, and services increased to $307,044 for the
third quarter of 1999 as compared to $270,033 in the third quarter of 1998,
reflecting an increase of 14%.  Gross revenues increased to $321,375 for the
quarter ending September 30, 1999, from $289,355 for the same quarter of 1998,
reflecting an increase of 11%. The increase in sales revenues is attributable to
shipment of large orders of the Company's products for use in Supervisory
Control and Data Acquisition (SCADA), and industrial automation applications.
</P>
</FONT><FONT SIZE=1>
</FONT><FONT SIZE=3><P ALIGN="JUSTIFY">For the nine months ended September 30,
1999, the Company has experienced reduced product sales revenues in domestic
sales to the industrial automation market.  It is Management's opinion that the
reduction in sales experienced in the industrial automation market is a result
of both decreased demand in automated control projects in the short term, and
competitive pressures from alternative product providers.  The lengthy purchase
cycles for industrial automation projects where the Company's products are used
makes prediction of trends difficult, but Management believes the reduction in
Domestic sales is a trend that may continue in the near term.  In an effort to
increase the competitiveness of the Company's products in the marketplace, end
user and distributor pricing for the Company's products were reduced during
second quarter.  Management expects increased sales volumes as a result of
reduced sales prices, which will offset reduced revenue per unit, however the
long term effect of the price reduction remains to be seen and could therefore
lead to a negative effect on sales revenues and in turn, profitability of the
Company.</P>
</FONT><FONT SIZE=1>
</FONT><FONT SIZE=3><P>The Company's revenues fall into three major customer
categories, Domestic, Export and U.S. Government Sales.  Domestic commercial
sales increased to $227,339 in the third quarter of 1999 as compared to $180,124
for the third quarter of 1998.  Foreign export sales for the third quarter of
1999 increased to $58,669 as compared to the $40,704 in the same quarter of
1998, due to a large order processed for a Brazilian customer.</P>

<P>U.S. Government sales decreased in the third quarter of 1999 to $21,036, down
from third quarter 1998 levels of $49,773.  Management believes the decreased
U.S. Government sales is a result of a continued lack of new projects and
purchases for the Company's products, which has been experienced through 1999,
and which Management feels may continue for the near term. Due to the uncertain
nature of U.S. Government purchasing, Management does not base profitability or
liquidity projections on expected U.S. Government sales.</P>

<P>During the quarter ended September 30, 1999, sales to Consolidated Electrical
Distributors, a national distributor, consisted of 14% of the Company's sales
and service revenues.  No other sales to a single customer comprised 10% or more
of the Company's product and service sales for the quarter ending September 30,
1999. </P>

<P>A percentage breakdown of EST's major customer categories of Domestic, Export
and U.S. Government Sales, for the third quarter of 1999 and 1998 are as
follows:</P>
</FONT><FONT SIZE=2><P>	</P></FONT>
<TABLE BORDER CELLSPACING=1 CELLPADDING=7 WIDTH=349>
<TR><TD WIDTH="52%" VALIGN="TOP">
<FONT SIZE=2><P>For the third quarter of</FONT></TD>
<TD WIDTH="26%" VALIGN="TOP">
<FONT SIZE=2><P>1999</P>
<P>------</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P>1998</P>
<P>------</FONT></TD>
</TR>
<TR><TD WIDTH="52%" VALIGN="TOP">
<FONT SIZE=2><P>Domestic Sales</FONT></TD>
<TD WIDTH="26%" VALIGN="TOP">
<FONT SIZE=2><P>74%</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P>67%</FONT></TD>
</TR>
<TR><TD WIDTH="52%" VALIGN="TOP">
<FONT SIZE=2><P>Export Sales</FONT></TD>
<TD WIDTH="26%" VALIGN="TOP">
<FONT SIZE=2><P>19%</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P>15%</FONT></TD>
</TR>
<TR><TD WIDTH="52%" VALIGN="TOP">
<FONT SIZE=2><P>U.S. Government Sales</FONT></TD>
<TD WIDTH="26%" VALIGN="TOP">
<FONT SIZE=2><P>7%</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P>18%</FONT></TD>
</TR>
</TABLE>

<FONT SIZE=1>
</FONT><FONT SIZE=3><P>A percentage breakdown of EST's product sales categories
for the third quarter of 1999 and 1998 are as follows:</FONT><FONT SIZE=2>
</P>
<P>           	</P></FONT>
<TABLE BORDER CELLSPACING=1 CELLPADDING=7 WIDTH=433>
<TR><TD WIDTH="57%" VALIGN="TOP">
<FONT SIZE=2><P>For the third quarter of</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=2><P>1999</P>
<P>------</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<FONT SIZE=2><P>1998</P>
<P>------</FONT></TD>
</TR>
<TR><TD WIDTH="57%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="JUSTIFY">ESTeem Model 192</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="JUSTIFY">46%</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="JUSTIFY">27%</FONT></TD>
</TR>
<TR><TD WIDTH="57%" VALIGN="TOP">
<FONT SIZE=2><P>ESTeem Model 95</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=2><P>18%</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<FONT SIZE=2><P>25%      </FONT></TD>
</TR>
<TR><TD WIDTH="57%" VALIGN="TOP">
<FONT SIZE=2><P>ESTeem Model 96</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=2><P> 9%</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<FONT SIZE=2><P>15%      </FONT></TD>
</TR>
<TR><TD WIDTH="57%" VALIGN="TOP">
<FONT SIZE=2><P>ESTeem Model 84SP/85SP</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=2><P>--</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<FONT SIZE=2><P>1%</FONT></TD>
</TR>
<TR><TD WIDTH="57%" VALIGN="TOP">
<FONT SIZE=2><P>ESTeem Accessories</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=2><P>14%</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<FONT SIZE=2><P>16%</FONT></TD>
</TR>
<TR><TD WIDTH="57%" VALIGN="TOP">
<FONT SIZE=2><P>Factory Services</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=2><P>3%</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<FONT SIZE=2><P>3%</FONT></TD>
</TR>
<TR><TD WIDTH="57%" VALIGN="TOP">
<FONT SIZE=2><P>Site Support/Custom Engineering</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=2><P>10%</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<FONT SIZE=2><P>13%</FONT></TD>
</TR>
</TABLE>

<FONT SIZE=2>
</FONT><FONT SIZE=3><P>Sales for the third quarter of 1999 and 1998 include
foreign export sales as follows:</P>
<P>	</P></FONT>
<TABLE BORDER CELLSPACING=1 CELLPADDING=7 WIDTH=451>
<TR><TD WIDTH="32%" VALIGN="TOP">
<FONT SIZE=3><P>Nine Months Ended</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=3><P ALIGN="CENTER">September 30</P>
</FONT><FONT SIZE=2><P ALIGN="CENTER">1999</P>
<P ALIGN="CENTER">-----------------</FONT></TD>
<TD WIDTH="35%" VALIGN="TOP">
<FONT SIZE=3><P ALIGN="CENTER">September 30</P>
</FONT><FONT SIZE=2><P ALIGN="CENTER">1998</P>
<P ALIGN="CENTER">-----------------</FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP">
<FONT SIZE=2><P>  Export sales</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$   58,669</FONT></TD>
<TD WIDTH="35%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$   40,704</FONT></TD>
</TR>
<TR><TD WIDTH="32%" VALIGN="TOP">
<FONT SIZE=2><P>  Percent of sales</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">19%</FONT></TD>
<TD WIDTH="35%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">15%</FONT></TD>
</TR>
</TABLE>

<FONT SIZE=1>
</FONT><FONT SIZE=3><P>The geographic distribution of foreign sales for the
third quarter of  1999 and 1998 is as follows:</P>
<P>		</P></FONT>
<TABLE BORDER CELLSPACING=1 CELLPADDING=7 WIDTH=493>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=3><P>Percent of Foreign Sales</FONT></TD>
<TD WIDTH="34%" VALIGN="TOP">
<FONT SIZE=3><P ALIGN="CENTER">September 30</P>
</FONT><FONT SIZE=2><P ALIGN="CENTER">1999</P>
<P ALIGN="CENTER">-----------------</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=3><P ALIGN="CENTER">September 30</P>
</FONT><FONT SIZE=2><P ALIGN="CENTER">1998</P>
<P ALIGN="CENTER">-----------------</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>COUNTRY</P>
<P>---------------------</FONT></TD>
<TD WIDTH="34%" VALIGN="TOP"> </TD>
<TD WIDTH="33%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Brazil</FONT></TD>
<TD WIDTH="34%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">44 %</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">--</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Croatia/Slovenia</FONT></TD>
<TD WIDTH="34%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">24 %</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">21%</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>South Korea</FONT></TD>
<TD WIDTH="34%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">16 %</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">20 %</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Thailand</FONT></TD>
<TD WIDTH="34%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">7 %</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">--</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Israel</FONT></TD>
<TD WIDTH="34%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">6  %</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">9 %</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Indonesia</FONT></TD>
<TD WIDTH="34%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">3  %</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">--</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Mexico</FONT></TD>
<TD WIDTH="34%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">Nil</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">9 %</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Chile</FONT></TD>
<TD WIDTH="34%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">--</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">16 %</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Canada</FONT></TD>
<TD WIDTH="34%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">--</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">26%</FONT></TD>
</TR>
</TABLE>

<FONT SIZE=2><P ALIGN="JUSTIFY"></P>
</FONT><FONT SIZE=3><P ALIGN="JUSTIFY">The majority of the Company's domestic
and foreign sales for the third quarter of 1999 were used in Supervisory Control
and Data Acquisition (SCADA) applications. It is Management's opinion that these
applications will continue to provide the largest portion of the Company's
domestic sales revenues in the foreseeable future, but will be strongly
augmented by Mobile Data Computer Systems for public safety entities. </P>
<P ALIGN="JUSTIFY"></P>
<P ALIGN="JUSTIFY">The Company's Automated Identification Technology (AIT)
subcontract with INTERMEC was a five-year indefinite delivery, indefinite
quantity, fixed price contract in place through the end of September 1999.  The
Company did not provide material or derive any sales revenues from this contract
during the third quarter of 1999. It is Management's opinion that the AIT
subcontract contract has not been renewed by INTERMEC due to restructuring of
the AIT program and subsequent contracts awarded to INTERMEC. </P>
<P ALIGN="JUSTIFY"></P>
<P ALIGN="JUSTIFY">Based on previous sales activity, the majority of all U.S.
Government purchases are expected to be under the Company's General Services
Administration (GSA) contract.  Projections regarding liquidity, profitability,
and material purchases are based on past history of annual purchases.
Historically Federal sales average approximately 18% of annual sales, but this
level cannot be guaranteed. Due to the uncertain nature of Federal purchasing,
procurement of material and production planning is adjusted quarterly based on
demand. It is Management's opinion that the majority of U.S. Government
purchases in 1999 will be under this contract.</P>
<P ALIGN="JUSTIFY"></P>
<P>The Company's revenues have historically fluctuated from quarter to quarter
due to timing factors such as customer order placement and product shipments to
customers, as well as customer buying trends, and changes in the general
economic environment. The procurement process regarding plant and project
automation, or project development, which usually surrounds the decision to
purchase ESTeem products can be lengthy. This procurement process may involve
bid activities unrelated to the ESTeem products, such as additional systems and
subcontract work, as well as capital budget considerations on the part of the
customer.  Because of the complexity of this procurement process, forecasts in
regard to the Company's revenues become difficult to predict. </P>
<P ALIGN="JUSTIFY"></P>
<P ALIGN="JUSTIFY">The Company has undertaken the process to identify
anticipated costs, and implementation issues associated with transition of the
Company's products and internal systems to operations during and after the Year
2000. The Company expects to resolve any Year 2000 issues associated with the
Company's internal and operations systems through planned replacement or
upgrades of software applications, which are not currently deemed to have
significant cost potential. All of the products supplied by the Company to
customers are Year 2000 compliant. Management does not expect Year 2000
transition issues to have a material impact on its operations, but there can be
no assurance that there will not be interruptions or disturbance of operations
should negative transition issues arise.</FONT><FONT FACE="Courier New" SIZE=3>
</P>
</FONT><FONT SIZE=1>
</FONT><B><FONT FACE="Arial" SIZE=2><P>BACKLOG:</P>
</B></FONT><FONT SIZE=1>
</FONT><FONT SIZE=3><P>The Company had backlog of $43,000 at September 30, 1999,
for orders placed late in the quarter.  The Company expects to make delivery all
backlog items early in the fourth quarter of 1999.  Customers generally place
orders on an "as needed basis".  Shipment is generally made within 5 to 10
working days after receipt of an order from a customer.</P>
</FONT><FONT SIZE=1>
</FONT><B><FONT FACE="Arial" SIZE=2><P>COST OF SALES: </P>
</B></FONT><FONT SIZE=1>
</FONT><FONT SIZE=3><P ALIGN="JUSTIFY">Cost of sales percentages of gross sales
for the third quarters of 1999 and 1998 were 50% and 48% of gross sales
respectively.  Cost of Sales variations are attributable to the type of product
sold and the size of the order.  Larger orders grant lower sales prices because
of volume discounting, reducing the margin of profit. The increase in cost of
sales in the second quarter of 1999 is due to a combination of decreased sales
prices and product mix.</P>
</FONT><FONT SIZE=2><P ALIGN="JUSTIFY"> </P>
</FONT><B><FONT FACE="Arial" SIZE=2><P>OPERATING EXPENSES:</P>
</B></FONT><FONT SIZE=1>
</FONT><FONT SIZE=2><P>Operating expenses for the third quarter of 1999
decreased $5,356 when compared with the third quarter of 1998.  The following is
a delineation of operating expenses:</P>
</FONT><FONT SIZE=1></FONT>
<TABLE BORDER CELLSPACING=1 CELLPADDING=7 WIDTH=559>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>For the quarter ended:</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">Sept. 30</P>
<P ALIGN="CENTER">1999</P>
<P ALIGN="CENTER">------------</FONT></TD>
<TD WIDTH="23%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">Sept. 30</P>
<P ALIGN="CENTER">1998</P>
<P ALIGN="CENTER">------------</FONT></TD>
<TD WIDTH="23%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">Increase</P>
<P ALIGN="CENTER">(Decrease)</P>
<P ALIGN="CENTER">-------------</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Finance/Administration</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$  35,047</FONT></TD>
<TD WIDTH="23%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$  32,227</FONT></TD>
<TD WIDTH="23%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$    2,820</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Research/Development</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">35,404</FONT></TD>
<TD WIDTH="23%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">28,358</FONT></TD>
<TD WIDTH="23%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">7,046</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Marketing</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">48,277</FONT></TD>
<TD WIDTH="23%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">59,154</FONT></TD>
<TD WIDTH="23%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">(  10,877)</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Customer Service</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">12,276</P>
<P ALIGN="CENTER">-------------</FONT></TD>
<TD WIDTH="23%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">16,621</P>
<P ALIGN="CENTER">-------------</FONT></TD>
<TD WIDTH="23%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">(    4,345)</P>
<P ALIGN="CENTER">-------------</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<FONT SIZE=2><P>Total Operating Expenses</FONT></TD>
<TD WIDTH="22%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$131,004</P>
<P ALIGN="CENTER">=======</FONT></TD>
<TD WIDTH="23%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$136,360</P>
<P ALIGN="CENTER">=======</FONT></TD>
<TD WIDTH="23%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">$(   5,356)</P>
<P ALIGN="CENTER">=======</FONT></TD>
</TR>
</TABLE>

<FONT SIZE=1>
</FONT><B><FONT FACE="Arial" SIZE=2><P>FINANCE AND ADMINISTRATION:</P>
</B></FONT><FONT SIZE=1>
</FONT><FONT SIZE=2><P>During the third quarter of 1999 Finance and
Administration expenses increased $2,820 when compared with the third quarter of
1998.  The increase in expenses is the result of increased professional
services,  salaries, and bad debt expense recognized by the Company in the third
quarter of 1999. </P>
</FONT><FONT SIZE=1>
</FONT><B><FONT FACE="Arial" SIZE=2><P>RESEARCH AND DEVELOPMENT:</P>
</B></FONT><FONT SIZE=1>
</FONT><FONT SIZE=2><P>During the third quarter of 1999, Research and
Development expenses increased $7,046 comparatively with the third quarter of
1998.  The increase in Research and Development expenditures is due to increased
in-house labor dedicated to design and development projects when compared with
the third quarter of 1998.  The majority of Research and Development
expenditures in the third quarter were in-house development and refinement of
existing ESTeem products. </P>
</FONT><B><FONT FACE="Arial" SIZE=2>
<P>MARKETING:</P>
</B></FONT><FONT SIZE=2>
<P ALIGN="JUSTIFY">Marketing expenses decreased $10,877 from the same period in
1998, due primarily to timing differences in advertising commitments by the
Company when compared with the same period of 1998. </P>
</FONT><FONT FACE="Courier New" SIZE=1><P ALIGN="JUSTIFY"></P>
</FONT><B><FONT FACE="Arial" SIZE=2><P>CUSTOMER SERVICE:</P>
</B></FONT><FONT SIZE=1>
</FONT><FONT SIZE=2><P ALIGN="JUSTIFY">Customer service expenses for the third
quarter of 1999 decreased $4,345 when compared with the third quarter of 1998.
The decrease is due to reduced salaries and wages being allocated to customer
service when compared with the same period of 1998.</P>
</FONT><FONT SIZE=1>
</FONT><B><FONT FACE="Arial" SIZE=2><P>INTEREST INCOME:</P>
</B></FONT><FONT SIZE=1>
</FONT><FONT SIZE=2><P>The Corporation earned $14,331 in interest income for the
quarter ended September 30, 1999. Sources of interest income were short-term
investments, as well as savings and money market accounts.</P>

</FONT><B><FONT FACE="Arial" SIZE=2><P>ENGINEERING SUPPORT:</P>
</B></FONT><FONT SIZE=1>
</FONT><FONT SIZE=2><P ALIGN="JUSTIFY">Engineering support costs decreased to
$17,575 for the quarter ended September 30, 1999, as compared to $18,237 for the
same period of 1998.  The decrease in engineering support costs is a direct
result of reduced engineering services requested by customers in the third
quarter of 1999.  </P>
</FONT><FONT SIZE=1>
</FONT><B><FONT FACE="Arial" SIZE=2><P>NET INCOME (LOSS):</P>
</B></FONT><FONT SIZE=1>
</FONT><FONT SIZE=3><P>The Corporation had net income of $22,266 for the third
quarter of 1999, compared to a $9,817 for the third quarter of 1998.  The
increase is attributable to increased sales revenues and decreased operating
expenses in the third quarter of 1999, as compared with the third quarter of
1998.  The net income for the third quarter of 1999 reduced the Company's year
to date net loss to $12,451 as of September 30, 1999, as compared with a year to
date net income of $82,093 at September 30, 1998.  The year to date net loss for
the Company is the result of lower than expected sales revenues and increased
operating expenses in the first quarter of 1999.  </P>
</FONT><U><FONT SIZE=1>
</U></FONT><B><FONT FACE="Arial" SIZE=2><P>B.  Financial Condition, Liquidity
and Capital Resources</P>
</B></FONT><FONT SIZE=1>
</FONT><FONT SIZE=3><P>The Corporation's current asset to current liabilities
ratio at September 30, 1999 was 32:1 compared to 25.3:1 at December 31, 1998.
The increase in current ratio is attributable to decreases in federal income
taxes payable and accounts payable when compared with year-end 1998.</P>
</FONT><FONT SIZE=1><P ALIGN="JUSTIFY"></P>
</FONT><FONT SIZE=3><P>For the quarter ending September 30, 1999, the Company
had cash and cash equivalent short-term investment holdings of $1,450,176 as
compared to cash and cash equivalent holdings of $1,426,381 at December 31,
1998.  The increase is attributable primarily to conversion of the Company's
accounts receivables at December 31, 1998 into cash and was offset by the
Company's year to date net loss, additions to property, plant and equipment
assets and payment of the Company's declared cash distribution to shareholders.
</P>
<P ALIGN="JUSTIFY"></P>
<P ALIGN="JUSTIFY">Accounts receivable decreased to $194,094 as of September 30,
1999, from December 31, 1998 levels of $381,386, due to comparison with large
accounts receivable amounts from strong year-end 1998 U.S. Government sales.
The Company recognized bad debt expense in the amount of $1,155 for doubtful
accounts written off during the third quarter of 1999. Management believes all
of the Company's accounts receivable as of September 30, 1999 are collectible.
</P>
<P ALIGN="JUSTIFY"></P>
<P ALIGN="JUSTIFY">Inventory increased $388,014 at September 30, 1999, from
December 31, 1998 levels of $385,365 due to decreased product sales during the
first quarter of 1999, and procurement of material for ESTeem 192S product line
production. Prepaid expenses increased to 18,891 as of September 30, 1999, as
compared with December 31, 1998 levels of $5,202 due to prepaid insurance policy
renewals and prepaid fees for tradeshows to be attended by the Company in the
fourth quarter of 1999.  Provision for Federal Income Taxes increased to $22,414
at September 30, 1999 due to a combination of provision for potential tax credit
for the Company's year to date net loss and required minimum tax payments by the
Company in the first and second quarters of 1999. </P>

<P ALIGN="JUSTIFY">The Company's fixed assets increased to $424,858 as of
September 30, 1999, from December 31, 1998 levels of $358,436, resulting from
capital expenditures of $66,422.  The majority of the expenditures resulted from
the construction of an exterior case die for the ESTeem products to increase
ease of use and functionality of the Company's products.  Amounts paid to the
vendor manufacturing the die previously carried as a deposit (classified in
"Other Assets")  by the Company were applied to the Company's
property, plant and equipment assets upon completion of die construction.
Management foresees additional capital expenditures as may be necessary in 1999
to support the production and sale of the Company's products.</P>

<P ALIGN="JUSTIFY">As of September 30, 1999, the Company's trade accounts
payable balance was $43,740 as compared with $52,386 at December 31, 1998, and
reflects amounts owed for purchases of inventory items and contracted services.
The Company's deferred income liability at December 31, 1998 of $25,017 was
reduced to $0 as the Company fulfilled product contract obligations in the first
quarter of 1999 to offset the deferred income liability. </P>
</FONT><FONT SIZE=2><P>  </P>
</FONT><FONT SIZE=3><P>It is Management's opinion the Company's cash, cash
equivalent reserves, and working capital at September 30, 1999 are sufficient to
satisfy requirements for operations, capital expenditures, and other
expenditures as may arise in the short term. </P>
</FONT><FONT SIZE=1>
</FONT><B><I><FONT FACE="Arial" SIZE=3><P ALIGN="JUSTIFY">FORWARD LOOKING
STATEMENTS:</FONT><FONT SIZE=3>  The above discussion may contain forward
looking statements that involve a number of risks and uncertainties.  In
addition to the factors discussed above, among other factors that could cause
actual results to differ materially are the following: competitive factors such
as rival wireless architectures and price pressures; availability of third party
component products at reasonable prices; inventory risks due to shifts in market
demand and/or price erosion of purchased components; change in product mix, and
risk factors that are listed in the Company's reports and registration
statements filed with the Securities and Exchange Commission.</P>
</B></I></FONT><FONT FACE="Courier New">
</FONT><FONT FACE="Courier" SIZE=2><P ALIGN="JUSTIFY"> </P>
<P ALIGN="CENTER"> </P>
</FONT><B><FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">PART II</P>
<P ALIGN="CENTER">OTHER INFORMATION</P>
</B></FONT><FONT SIZE=2><P ALIGN="JUSTIFY"></P>
</FONT><B><FONT FACE="Arial" SIZE=2><P ALIGN="JUSTIFY">Item 5.  OTHER
INFORMATION</P>
<P ALIGN="JUSTIFY"></P><DIR>
<DIR>

</B></FONT><FONT SIZE=2><P ALIGN="JUSTIFY">On October 25, 1999, the Company
filed a Form 8A-12(g) registration statement with the Securities and Exchange
Commission, thereby registering the Company's securities pursuant to the
Securities and Exchange Act of 1934.  The Company's 8A-12(g) Registration
Statement, dated October 25, 1999 is included herein by reference.</P>
<P ALIGN="JUSTIFY"></P></DIR>
</DIR>

</FONT><B><FONT FACE="Arial" SIZE=2><P>Item 6.  EXHIBITS AND REPORTS ON FORM 8-
K</P>
</B></FONT><FONT SIZE=2>
<P> 	(a)	Exhibits</P>
<DIR>
<DIR>

<P>Exhibit 27. Financial Data Schedule, September 30, 1999</P>
</DIR>
</DIR>

<P>(b)	Reports on Form 8-K                                  </P>
<P>        </P><DIR>
<DIR>

<P>Form 8-K dated June 11, 1999 is incorporated herein by reference.  </P></DIR>
</DIR>

<P>  </P></FONT>
<TABLE BORDER CELLSPACING=1 CELLPADDING=7 WIDTH=625>
<TR><TD WIDTH="51%" VALIGN="TOP">
<FONT SIZE=2><P>Exhibit Index </FONT></TD>
<TD WIDTH="49%" VALIGN="TOP">
<FONT SIZE=2><P>Reference Form 10-QSB Notes to Financial Statements</FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP"> </TD>
<TD WIDTH="49%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP">
<FONT SIZE=2><P>Exhibit Number</FONT></TD>
<TD WIDTH="49%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP"> </TD>
<TD WIDTH="49%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP">
<B><FONT FACE="Arial" SIZE=2><P>4. Instruments defining the Rights of Security
Holders including indentures.</B></FONT></TD>
<TD WIDTH="49%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="JUSTIFY">Form 8-K dated February 12, 1999 is incorporated
herein by reference.  </FONT></TD>
<TD WIDTH="49%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP">
<B><FONT FACE="Arial" SIZE=2><P>11. Statement Re: computation of per share
earnings.</B></FONT></TD>
<TD WIDTH="49%" VALIGN="TOP">
<FONT SIZE=2><P>Note 3 to Financial Statements</FONT></TD>
</TR>
</TABLE>

<FONT SIZE=2>
</FONT><B><FONT FACE="Arial" SIZE=2><P ALIGN="CENTER"> </P>
<P ALIGN="CENTER"> </P>
<P ALIGN="CENTER">SIGNATURES</P>
</B></FONT><FONT SIZE=2><P ALIGN="JUSTIFY"></P>
<P ALIGN="JUSTIFY">In accordance with the requirements of the Exchange Act, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.</P>
<P ALIGN="JUSTIFY"></P>
<P ALIGN="JUSTIFY">  </P>
</FONT><B><FONT FACE="Arial" SIZE=2><P>ELECTRONIC SYSTEMS TECHNOLOGY, INC.</P>
</B></FONT><FONT SIZE=2><P ALIGN="JUSTIFY"></P>
</FONT><P> </P>
<TABLE BORDER CELLSPACING=1 CELLPADDING=7 WIDTH=475>
<TR><TD WIDTH="47%" VALIGN="TOP">
<FONT SIZE=2><P> Date: November 4, 1999</FONT></TD>
<TD WIDTH="53%" VALIGN="TOP">
<FONT SIZE=2><P>By: /s/ T.L. KIRCHNER</FONT></TD>
</TR>
<TR><TD WIDTH="47%" VALIGN="TOP"> </TD>
<TD WIDTH="53%" VALIGN="TOP">
<FONT SIZE=2><P>Name:  T.L. Kirchner </FONT></TD>
</TR>
<TR><TD WIDTH="47%" VALIGN="TOP"> </TD>
<TD WIDTH="53%" VALIGN="TOP">
<FONT SIZE=2><P>Title:  Director/President </P>
<P>(Principal Executive Officer)</FONT></TD>
</TR>
<TR><TD WIDTH="47%" VALIGN="TOP">
<FONT SIZE=2><P> </FONT></TD>
<TD WIDTH="53%" VALIGN="TOP"> </TD>
</TR>
<TR><TD WIDTH="47%" VALIGN="TOP">
<FONT SIZE=2><P>Date: November 4, 1999</FONT></TD>
<TD WIDTH="53%" VALIGN="TOP">
<FONT SIZE=2><P>By: /s/ ROBERT SOUTHWORTH</FONT></TD>
</TR>
<TR><TD WIDTH="47%" VALIGN="TOP"> </TD>
<TD WIDTH="53%" VALIGN="TOP">
<FONT SIZE=2><P>Name:  Robert Southworth </FONT></TD>
</TR>
<TR><TD WIDTH="47%" VALIGN="TOP"> </TD>
<TD WIDTH="53%" VALIGN="TOP">
<FONT SIZE=2><P>Title:  Director/Secretary/Treasurer </P>
<P>(Principal Financial Officer)</FONT></TD>
</TR>
</TABLE>

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