<PAGE>

                                 UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549
                                  FORM 10-QSB

(Mark One)

[X]  Quarterly Report pursuant to Section 13 or 15 (d) of the Securities
     Exchange Act of 1934

For the quarterly period ended March 31,2001
                               -------------

[_]  Transition Report pursuant to Section 13 or 15 (d) of the Securities
     Exchange Act of 1934

For the transition period from ______________________ to ______________________

Commission File Number: 0-4036
                        ------

                       Kreisler Manufacturing Corporation
--------------------------------------------------------------------------------
        (Exact name of small business issuer as specified in its charter)

               Delaware                                 22-1044792
--------------------------------------------------------------------------------
    (State of other jurisdiction of                  (I.R.S. employer
    incorporation or organization)                  Identification No.)

         5960 Central Avenue, Suite H., St. Petersburg, Florida 33707
--------------------------------------------------------------------------------
                   (Address of principal executive offices)

                                (727) 347-1144
--------------------------------------------------------------------------------
                          (Issuer's telephone number)

                                Not Applicable
--------------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since last
report)

Check whether the issuer (1) 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.

                                 [X] Yes [_] No

The number of shares outstanding of issuer's Common Stock, par value $.125 per
share, as of March 31,2001 was 1,957,350 shares.

Transitional small business disclosure format (check one):   Yes [_]    No [X]
<PAGE>

              Kreisler Manufacturing Corporation and Subsidiaries
                                Table of Contents

<TABLE>
<CAPTION>
PART I   Financial Information                                      Page Number
<S>                                                                 <C>
Item 1   Financial Statements
           Consolidated Balance Sheets                                  3
           Consolidated Statements of Operations                        4
           Consolidated Statements of Cash Flows                        5
           Notes To Financial Statements                                6-7

Item 2   Management's Discussion and Analysis or Plan of Operation      8-9

PART II  Other Information

Item 1   Legal Proceedings                                              10

Item 2   Changes in Securities and Use of Proceeds                      10

Item 3   Defaults Upon Senior Securities                                10

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

Item 5   Other Information                                              10

Item 6   Exhibits and Reports on Form 8-K                               11-13
</TABLE>


                                       2
<PAGE>

PART I  FINANCIAL INFORMATION

Item 1  Financial Statements

              Kreisler Manufacturing Corporation and Subsidiaries
                          CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                                  (Unaudited)
------------------------------------------------------------------------------------------------------------------
                                                                             Third Quarter Ended        Year Ended
                                                                                    3/31/01               6/30/00
------------------------------------------------------------------------------------------------------------------
<S>                                                                          <C>                       <C>
Assets
Cash and cash equivalents                                                          $ 4,556,751         $ 4,045,523
Accounts receivable - trade                                                          2,692,216           2,574,499
Inventories
   Raw Materials                                                                     1,980,782           1,738,934
   Work in Process                                                                     562,114             500,265
   Finished Goods                                                                      133,836             102,000
------------------------------------------------------------------------------------------------------------------
                                                                                     2,676,732           2,341,199

Deferred tax asset                                                                     355,000              26,600
Insurance recovery anticipated                                                       2,500,000                  --
Other current assets                                                                    53,840              44,967
------------------------------------------------------------------------------------------------------------------
Total current assets                                                                12,834,539           9,032,788
Property, plant & equip., at cost, less accumulated
Depreciation of $3,122,661 for 2001 and $2,873,373 for 2000                            817,022             469,692
Other Assets:
   Deferred tax asset                                                                  471,200                  --
------------------------------------------------------------------------------------------------------------------
                                                                                   $14,122,761         $ 9,502,480
------------------------------------------------------------------------------------------------------------------

Liabilities and Stockholders' Equity
Accounts payable - trade                                                           $   987,522         $   575,128
Accrued expenses                                                                     1,533,717             746,516
Accrued environmental costs                                                            880,000                  --
------------------------------------------------------------------------------------------------------------------
Total current liabilities                                                            3,401,239           1,321,644
------------------------------------------------------------------------------------------------------------------
Long term liabilities:
Accrued environmental costs                                                          1,260,000                  --
------------------------------------------------------------------------------------------------------------------
Total liabilities                                                                    4,661,239           1,321,644
------------------------------------------------------------------------------------------------------------------
Stockholders' Equity
Common Stock, $.125 par value - 3,000,000 shares authorized 1,957,350 and
  1,955,379 shares issued and outstanding for March 31, 2001 and
  June 30, 2000 respectively                                                           245,174             244,423
Additional paid-in capital                                                           1,592,618           1,586,700
Retained earnings                                                                    7,623,730           6,349,713
------------------------------------------------------------------------------------------------------------------
Total Stockholders' Equity                                                           9,461,522           8,180,836
------------------------------------------------------------------------------------------------------------------
                                                                                   $14,122,761         $ 9,502,480
------------------------------------------------------------------------------------------------------------------
</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements

                                       3
<PAGE>

              Kreisler Manufacturing Corporation and Subsidiaries
                     CONSOLIDATED STATEMENTS OF OPERATIONS
                                  (Unaudited)

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------
Three Months Ended March 31                                                             2001           2000
---------------------------------------------------------------------------------------------------------------
<S>                                                                                <C>             <C>
Revenues                                                                           $  4,317,360    $  4,436,756
---------------------------------------------------------------------------------------------------------------

Cost of goods sold                                                                    3,762,155       3,816,107
Selling, general and administrative expenses                                            137,692         321,868
---------------------------------------------------------------------------------------------------------------
Change in provision for environmental remediation                                    (1,090,000)             --
---------------------------------------------------------------------------------------------------------------
                                                                                      2,809,847       4,137,975
---------------------------------------------------------------------------------------------------------------
Earnings from operations                                                              1,507,513         298,781

Other income:
Interest and other earnings                                                              75,351          47,879
---------------------------------------------------------------------------------------------------------------
Earnings before income taxes                                                          1,582,864         346,660

Provision for income tax                                                                633,977         (43,818)
---------------------------------------------------------------------------------------------------------------
Net earnings                                                                       $    948,887    $    390,478
---------------------------------------------------------------------------------------------------------------
Earnings per share:
Net earnings basic shares                                                          $        .48    $        .20
Net earnings diluted shares                                                        $        .46    $        .19
---------------------------------------------------------------------------------------------------------------

<CAPTION>
---------------------------------------------------------------------------------------------------------------
Nine Months Ended March 31                                                              2001           2000
---------------------------------------------------------------------------------------------------------------
<S>                                                                                <C>             <C>
Revenues                                                                           $ 12,355,487    $ 10,066,347
---------------------------------------------------------------------------------------------------------------

Cost of goods sold                                                                   10,358,567       9,299,425
Selling, general and administrative expenses                                            433,563         763,683
---------------------------------------------------------------------------------------------------------------
Change in provision for environmental remediation                                      (360,000)           --
---------------------------------------------------------------------------------------------------------------
                                                                                     10,432,130      10,063,108
---------------------------------------------------------------------------------------------------------------
Earnings from operations                                                              1,923,357           3,239

Other income:
Interest and other earnings                                                             199,994         153,538
---------------------------------------------------------------------------------------------------------------
Earnings before income taxes                                                          2,123,351         156,777

Provision for income tax                                                                849,340            (182)
---------------------------------------------------------------------------------------------------------------
Net earnings                                                                       $  1,274,011    $    156,959
---------------------------------------------------------------------------------------------------------------
Earnings per share:
Net earnings basic shares                                                          $        .65    $        .08
Net earnings diluted shares                                                        $        .63    $        .08
---------------------------------------------------------------------------------------------------------------
</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements

                                       4
<PAGE>

              Kreisler Manufacturing Corporation and Subsidiaries
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                  (Unaudited)

<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------
Nine Months Ended March 31                                                           2001           2000
------------------------------------------------------------------------------------------------------------
<S>                                                                              <C>             <C>
Cash flows from operating activities:
Net earnings                                                                      $ 1,274,011    $   156,959
Adjustments to reconcile net income to
  cash provided (used) by operating activities:
Depreciation and amortization                                                         102,659         68,805
(Increase) decrease in operating assets:
Accounts receivable - trade                                                          (117,717)        50,693
Inventories                                                                          (335,533)      (399,421)
Deferred tax benefit                                                                 (799,600)          --
Insurance recovery                                                                 (2,500,000)          --
Other current assets                                                                   (8,873)          (329)
Increase (decrease) in operating liabilities:
Accounts payable - trade                                                              412,397       (130,185)
Accrued expenses                                                                      787,206       (546,342)
Accrued environmental costs                                                         2,140,000
------------------------------------------------------------------------------------------------------------
Net adjustments                                                                      (319,461)      (956,780)
------------------------------------------------------------------------------------------------------------
Cash provided (used) by operating activities                                          954,550       (799,820)

Cash flows from investing activities:
Purchase of property and equipment                                                   (449,990)      (137,245)
------------------------------------------------------------------------------------------------------------
Cash used by investing activities                                                    (449,990)      (137,245)

Cash flows from financing activities:
Exercised Stock Options                                                                 6,668          6,667
------------------------------------------------------------------------------------------------------------
Cash provided by financing activities                                                   6,668          6,667

Increase in cash and cash equivalents                                                 511,228       (930,398)
Cash and cash equivalents at beginning of year                                      4,045,523      4,170,103
------------------------------------------------------------------------------------------------------------
Cash and cash equivalents at March 31                                             $ 4,556,751    $ 3,239,705
------------------------------------------------------------------------------------------------------------

Income taxes paid                                                                 $   619,300    $    29,000
------------------------------------------------------------------------------------------------------------
</TABLE>

The accompanying notes are an integral part of these consolidated financial
statements

                                       5
<PAGE>

              Kreisler Manufacturing Corporation and Subsidiaries
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.  Principles of Consolidation

The financial statements include the accounts of the Company and its
wholly-owned subsidiaries after elimination of significant intercompany
transactions. The preparation of financial statements in conformity with
generally accepted accounting principles requires the use of management's
estimates. In the opinion of management all adjustments necessary for a fair
presentation of such financial statements have been included. Such adjustments
consisted only of normal recurring items. Interim results are not necessarily
indicative of results for a full year.

The financial statements and notes are presented as permitted by Form 10-QSB,
and do not contain certain information included in the Company's annual
financial statements and notes. Accordingly, these statements should be read in
conjunction with the consolidated financial statements and notes thereto
appearing in the Annual Report of the Company for the fiscal year ended June 30,
2000.

2.  Inventories

For the September and March quarters inventory is based on management's estimate
of material usage. Physical inventories are taken for the December quarter and
June year end and appropriate adjustments are made. Any change on December 31
and year end physical inventory compared with that based on estimated material
usage could significantly effect results of operations.

3.  Income Tax Provision

At March 31,2001 the Company had no net operating loss carryforward for federal
income tax purposes, and a net operating loss carryforward for Florida state
income tax purposes of approximately $60,000, expiring over a period of years
through 2011.

4.  Contingencies

Certain federal and state laws authorize the United States Environmental
Protection Agency (EPA) to Issue orders and bring enforcement actions to compel
responsible parties to take investigative and remedial actions at any site that
is determined to present an imminent and substantial danger to the public or the
environment because on an actual or threatened release of one or more hazardous
substances. These statutory provisions impose joint and several responsibility
without regard to fault on all responsible parties, including the generators of
the hazardous substances, for certain investigative and remedial costs at sites
where these substances are or were produced or handled which contain
constituents classified hazardous. The Company generally provides for the
disposal or processing of such substances through licensed, independent
contractor

                                       6
<PAGE>

In July 1999 the Company became aware of historical releases of hazardous
substances at its leased facility located at 180 Van Riper Avenue, Elmwood Park,
New Jersey (Facility). The Company promptly notified the New Jersey Department
of Environmental Protection (Department) as required by the New Jersey Spill
Compensation and Control Act (Spill Act), N.J.S.A. 58:10-23.11, and retained the
services of environmental remediation consultants to perform a full site
characterization in accordance with the Department's Technical Requirements for
Site Remediation, N.J.A.C. 7:26E-1.1. The site characterization has been
completed. The preliminary cost estimate for remediation of the site is
approximately $ 2.140 million, (present value using a discount rate of 6.16%) to
be incurred over the next six years. It is reasonably possible that the
Company's recorded estimate of remediation cost may change in the near term.

The Company has notified its liability insurance carriers which issued liability
policies to the Company during the period from 1959 to 1985. The Company has
reached a settlement with one of its insurance carriers in the amount of
$2,500,000. The recorded amounts are as follows:

                  Accrued estimated Environmental cost        $  2,140,000
                  Insurance recovery anticipated                (2,500,000)
                                                              ------------
                  Current  year to date net gain              $   (360,000)

                                       7
<PAGE>

Item 2.   Management's Discussion and Analysis

              Kreisler Manufacturing Corporation and Subsidiaries
          MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLANS OF OPERATION
             FOR THREE MONTHS AND NINE MONTHS ENDED MARCH 31, 2001

 Description of Business

 Kreisler Manufacturing Corporation is a Delaware Corporation incorporated on
December 13, 1968, which succeeded a New Jersey Corporation incorporated in
1940, succeeding a New York Corporation which was incorporated in 1930. Kreisler
Manufacturing Corporation and its wholly-owned subsidiary, Kreisler Industrial
Corporation (collectively the "Company") incorporated in New Jersey July 3, 1956
manufactures precision metal components and assemblies at Elmwood Park, New
Jersey for use in aircraft, spacecraft and industrial gas turbine engines.

 Forward Looking Statements

 This Quarterly Report on Form 10QSB contains forward looking statements,
particularly with respect to the Liquidity and Capital Resources section of
Management's Discussion and Analysis of Financial Condition and Results of
Operations. Additional written or oral forward-looking statements may be made by
the Company from time to time, in filings with the SEC or otherwise. Such
forward-looking statements are within the meaning of that term in Section 27A of
the Securities Act of 1933 and Section 21 E of the Securities Exchange Act of
1934. Such statements may include, but not be limited to, projections of
revenue, income, losses, cash flows, capital expenditures, plans for future
operation, financing needs or plans, plans relating to products or services of
the Company, estimates concerning the effects of litigation or other disputes,
as well as assumptions to any of the foregoing.

 Forward looking statements are inherently subject to risks and uncertainties,
some of which can not be predicted. Future events and actual results could
differ materially from those set forth in or underlying the forward looking
statements.

 Products

 The Company fabricates precision metal components and assemblies primarily for
aircraft, spacecraft and industrial gas turbine engines. The primary function of
the Company's tubular products is to transport fluids including air, oil and gas
to various parts of the engine.

 Tube assemblies may be made of materials which include titanium, inconel and
stainless steel. These quality controlled and highly engineered manifold
assemblies transfer fuel for combustion, oil for lubrication, hydraulic fluid to
activate thrust reversers and impingement tubes or baffles to cool vanes in the
combustion section of the engine.

 Over the past three years, ninety percent of the Company's products were
tubular assemblies. For the nine months ended March 31, 2001, the sales activity
was approximately ninety percent for aircraft engines and ten percent for
industrial gas turbine engines.

                                       8
<PAGE>

  Substantially all sales of products are made through an in-house sales staff
supported by a government sales representative. All products are manufactured to
the blueprints and specifications of the particular customer. Orders are
received through competitive proposals which are made in response to requests
for bids from contractors who are frequently supplying engines for commercial
businesses or various branches of the United States Government.

Results of Operations

  Kreisler Manufacturing Corporation's revenue for the third quarter and nine
months ended March 31, 2001 decreased $119,400 or 3% and increased $2,289,000 or
23% respectively compared with the same period in the prior year. Revenue
increased both with current and new customers on new and mature programs.

  Operating income for the third quarter and nine months ended March 31, 2001
increased $1,209,000 and $1,920,000 respectively compared to the same period in
the prior year. Quarterly operating income includes a gain on environmental
insurance recovery of $1,090,000. Year to date operating income reflects the
insurance recovery gain of $1,090,000 less $730,000 in accrued environmental
expenses recorded in the first quarter of fiscal year 2001 for a net gain of
$360,000. Without these adjustments the third quarter operating income was
$417,000 or 10% of revenues compared to $299,000 or 7% for the same period in
the prior year. The improvement in the quarter reflects lower material costs and
reduced administrative expenses. Nine months operating income without
environmental insurance gain was $1,563,000 or 13% of revenue compared with
$3,000 in the same period in the prior year. Revenue increased $ 2,289,000 and
administrative expenses reduced by $330,000 for the same period in the prior
year without merger expenses.

  Cash and cash equivalents increased $511,000 or 13% after capital
expenditures of $450,000 and $619,000 in taxes.

  Other income compared to the three months and nine months in the prior year
increased $27,000 or 56% and $46,000 or 30% respectively with interest on higher
cash balances.

  Capital equipment revised budget for the year is $750,000 with $300,000 or
40% of the expenditure in the fourth quarter of fiscal year 2001.

  Kreisler's backlog has increased $4,500,000 or 36% since June 30,2000.
Shipments for the nine months exceeded $12,000,000. Aerospace backlog continues
to improve and the Industrial Gas Turbine market now represents 16% of the
backlog.

Board of Directors

  The Company is pleased to announce the addition of two new Board members. R.
James Cudd and William A. Kerr. Both have had extensive aerospace experience and
will bring additional independence to the Board of Directors. They will serve as
independent members of the Audit Committee and help develop direction and
policies for the Company.

                                       9
<PAGE>

PART II   OTHER INFORMATION

Item 1    Legal Proceedings
          None

Item 2    Changes in Securities and Use of Proceeds
          None

Item 3    Defaults Upon Senior Securities
          None

Item 4    Submission of Matter to a Vote of Security Holders
          None

Item 5    Other Information
          None

Item 6    Exhibits and Reports on Form 8K
          (a) Part I Exhibits
              11.  Statement re: computation of per share earnings

                                       10
<PAGE>

                                   SIGNATURE
                                   ---------

Pursuant to the requirements of the Exchange Act, the registrant caused this

report to be signed on its behalf by the undersigned, thereunto duly authorized.




                      KREISLER MANUFACTURING CORPORATION
                                 (Registrant)



                            By /s/ Edward L. Stern
                               --------------------
                                  Edward L. Stern
                               President, Treasurer

April 25, 2001

                                       11