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UNITED STATES SECURITIES AND EXCHANGE COMMISSIONWASHINGTON, D.C. 20549

FORM 10-Q

QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarter Ended December 31, 2003

Commission File Number 0-2762

MAXCO, INC.(Exact Name of Registrant as Specified in its Charter)

Michigan
    
    38-1792842(State or other Jurisdiction of
    
    (I.R.S. EmployerIncorporation or Organization)
    
    Identification Number)1118 Centennial WayLansing, Michigan
    
    48917(Address of principal executive offices)
    
    (Zip Code)


Registrants Telephone Number, including area code: (517) 321-3130

Indicate by check mark whether the registrant (1) has filed all annual,
quarterly and other reports required to be filed by Section 13 or 15 (d) of the
Securities Exchange Act of 1934 during the preceding twelve months and (2) has
been subject to the filing requirements for at least the past 90 days.

Yes þ           No o

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act).

Yes o          No þ

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

Class
    
    Outstanding at January 31, 2004Common Stock
    
    3,101,195 shares




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TABLE OF CONTENTS



|                                             |                                                                                               |  |  |  |  |  |  | 
|-------------------------------------------- | --------------------------------------------------------------------------------------------- |  |  |  |  |  |  | 
|PART I FINANCIAL INFORMATION                
|                                             | ITEM 1. FINANCIAL STATEMENTS                                                                 
|                                             | ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|                                             | ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                           
|                                             | ITEM 4. DISCLOSURE CONTROLS AND PROCEDURES                                                   
|PART II OTHER INFORMATION                   
|                                             | Item 1. Legal Proceedings                                                                    
|                                             | Item 2. Changes in Securities                                                                
|                                             | Item 3. Defaults Upon Senior Securities                                                      
|                                             | Item 4. Submission of Matters to a Vote of Security Holders                                  
|                                             | Item 5. Other Information                                                                    
|                                             | Item 6(a) Exhibits                                                                           
|                                             | Item 6(b) Reports on Form 8-K                                                                
|SIGNATURES                                  
|Exhibit Index                               
|302 Certification of Chief Executive Officer
|302 Certification of Chief Financial Officer
|906 Certification of Chief Executive Officer
|906 Certification of Chief Financial Officer



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PART I
FINANCIAL INFORMATION




ITEM 1. FINANCIAL STATEMENTS

CONDENSED CONSOLIDATED BALANCE SHEETS
Maxco, Inc. and Subsidiaries

December 31,
    
    
    March 31,2003
    
    
    2003(Unaudited)(in thousands)ASSETSCurrent AssetsCash and cash equivalents
    
    $
    333
    
    
    $
    391Accounts and notes receivable, less allowance of
$152,000 ($150,000 at March 31, 2003)
    
    
    6,304
    
    
    
    7,173Accounts receivablerelated parties
    
    
    543
    
    
    
    502InventoryNote 9
    
    
    769
    
    
    
    176Prepaid expenses and other
    
    
    115
    
    
    
    227Total Current Assets
    
    
    8,064
    
    
    
    8,469Marketable SecuritiesLong TermNote 2
    
    
    2
    
    
    
    312Property & EquipmentLand
    
    
    446
    
    
    
    446Buildings
    
    
    6,169
    
    
    
    6,166Machinery, equipment, and fixtures
    
    
    28,703
    
    
    
    28,40135,318
    
    
    
    35,013Allowances for depreciation
    
    
    (14,571
    )
    
    
    (12,416
    )20,747
    
    
    
    22,597Other AssetsInvestments
    
    
    1,088
    
    
    
    1,157Notes and contracts receivable and other, less allowance
of $600,000
    
    
    1,223
    
    
    
    981Advances to affiliate
    
    
    3,008
    
    
    
    3,008Intangibles
    
    
    1,424
    
    
    
    1,424Non-current assets of discontinued operationsNote 11
    
    
    
    
    
    
    4746,743
    
    
    
    7,044$
    35,556
    
    
    $
    38,422


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CONDENSED CONSOLIDATED BALANCE SHEETS  CONTINUED
Maxco, Inc. and Subsidiaries

December 31,
    
    
    March 31,2003
    
    
    2003(Unaudited)(in thousands)LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilitiesNotes payableNote 6
    
    $
    7,175
    
    
    $
    18,780Accounts payable
    
    
    4,076
    
    
    
    3,425Employee compensation
    
    
    1,516
    
    
    
    1,268Taxes, interest, and other liabilities
    
    
    3,355
    
    
    
    3,004Current maturities of long-term obligations
    
    
    1,835
    
    
    
    995Current liabilities of discontinued operationsNote 11
    
    
    
    
    
    
    303Total Current Liabilities
    
    
    17,957
    
    
    
    27,775Long-Term
Obligations, Less Current Maturities
    
    
    9,770
    
    
    
    1,113Stockholders EquityPreferred stock:Series Three: 10% cumulative redeemable, $60 face
value; 14,784 shares issues and outstanding
    
    
    678
    
    
    
    678Series Four: 10% cumulative redeemable, $51.50 face
value; 46,414 shares issues and outstanding
    
    
    2,390
    
    
    
    2,390Series Five: 10% cumulative redeemable, $120 face
value; 6,648 shares issues and outstanding
    
    
    798
    
    
    
    798Series Six: 10% cumulative callable, $160 face
value; 20,000 shares authorized, issued  none
    
    
    
    
    
    
    Common stock, $1 par value; 10,000,000 shares
authorized, 3,101,195 shares issued and outstanding
    
    
    3,101
    
    
    
    3,101Net unrealized losses
    
    
    (175
    )
    
    
    (298
    )Retained earnings
    
    
    1,037
    
    
    
    2,865Total
Stockholders Equity
    
    
    7,829
    
    
    
    9,534$
    35,556
    
    
    $
    38,422


See notes to consolidated financial statements

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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Maxco, Inc. and Subsidiaries
(Unaudited)

Three Months Ended December 31,2003
    
    
    2002(in thousands, except per share data)Net sales
    
    $
    10,562
    
    
    $
    8,701Costs and expenses:Cost of sales and operating expenses
    
    
    7,186
    
    
    
    5,405Selling, general and administrative
    
    
    2,941
    
    
    
    2,873Depreciation and amortization
    
    
    749
    
    
    
    75310,876
    
    
    
    9,031Operating Loss
    
    
    (314
    )
    
    
    (330
    )Other income (expense)Investment and other (loss) income
    
    
    (91
    )
    
    
    53Loss on sale of assets
    
    
    (74
    )
    
    
    Interest income
    
    
    40
    
    
    
    144Interest expense
    
    
    (468
    )
    
    
    (683
    )Loss From Continuing Operations Before Federal
Income Taxes and Equity in Loss of Affiliates
    
    
    (907
    )
    
    
    (816
    )Federal income tax benefit
    
    
    
    
    
    
    (169
    )Loss From Continuing Operations Before Equity in
Loss of Affiliates
    
    
    (907
    )
    
    
    (647
    )Equity
in earnings (loss) of affiliates, net of tax
    
    
    50
    
    
    
    (76
    )Loss From Continuing Operations
    
    
    (857
    )
    
    
    (723
    )Income from discontinued operations, net of tax
    
    
    
    
    
    
    151Net Loss
    
    
    (857
    )
    
    
    (572
    )Less preferred stock dividends
    
    
    (102
    )
    
    
    (102
    )Net Loss Applicable to Common Stock
    
    $
    (959
    )
    
    $
    (674
    )Net Loss Per Common ShareBasic and DilutedContinuing operations
    
    $
    (0.31
    )
    
    $
    (0.27
    )Discontinued operations
    
    
    
    
    
    
    0.05$
    (0.31
    )
    
    $
    (0.22
    )


See notes to consolidated financial statements

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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Maxco, Inc. and Subsidiaries
(Unaudited)

Nine Months Ended December 31,2003
    
    
    2002(in thousands, except per share data)Net sales
    
    $
    29,324
    
    
    $
    26,535Costs and expenses:Cost of sales and operating expenses
    
    
    19,408
    
    
    
    16,542Selling, general and administrative
    
    
    8,376
    
    
    
    8,452Depreciation and amortization
    
    
    2,202
    
    
    
    2,26329,986
    
    
    
    27,257Operating Loss
    
    
    (662
    )
    
    
    (722
    )Other income (expense)Investment and other losses
    
    
    (431
    )
    
    
    (1,625
    )Gain on sale of assets
    
    
    838
    
    
    
    149Interest income
    
    
    114
    
    
    
    548Interest expense
    
    
    (1,341
    )
    
    
    (1,545
    )Loss From Continuing Operations Before Federal
Income Taxes and Equity in Loss of Affiliates
    
    
    (1,482
    )
    
    
    (3,195
    )Federal income tax benefit
    
    
    
    
    
    
    (978
    )Loss From Continuing Operations Before Equity in
Loss of Affiliates
    
    
    (1,482
    )
    
    
    (2,217
    )Equity in loss of affiliates, net of tax
    
    
    (40
    )
    
    
    (2,487
    )Loss From Continuing Operations
    
    
    (1,522
    )
    
    
    (4,704
    )Loss from discontinued operations, net of tax
    
    
    
    
    
    
    (1,510
    )Net Loss
    
    
    (1,522
    )
    
    
    (6,214
    )Less preferred stock dividends
    
    
    (306
    )
    
    
    (306
    )Net Loss Applicable to Common Stock
    
    $
    (1,828
    )
    
    $
    (6,520
    )Net Loss Per Common ShareBasic and DilutedContinuing operations
    
    $
    (0.59
    )
    
    $
    (1.61
    )Discontinued operations
    
    
    
    
    
    
    (0.49
    )$
    (0.59
    )
    
    $
    (2.10
    )


See notes to consolidated financial statements

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Maxco, Inc. and Subsidiaries
(Unaudited)

Nine Months Ended December 31,2003
    
    
    2002(in thousands)Operating ActivitiesNet loss
    
    $
    (1,522
    )
    
    $
    (6,214
    )Loss from discontinued operations
    
    
    
    
    
    
    1,510Loss from continuing operations
    
    
    (1,522
    )
    
    
    (4,704
    )Advances to discontinued operations
    
    
    
    
    
    
    (1,758
    )Adjustments to reconcile net loss to net cash
provided by operating activities:Net gains on sale of assets
    
    
    (838
    )
    
    
    (149
    )Non-cash investment losses
    
    
    431
    
    
    
    1,625Depreciation and other non-cash items
    
    
    2,242
    
    
    
    3,779Changes in operating assets and liabilities
    
    
    1,723
    
    
    
    6,971Net Cash Provided By Operating Activities
    
    
    2,036
    
    
    
    5,764Investing ActivitiesSale of businesses
    
    
    
    
    
    
    8,233Sale of buildings
    
    
    400
    
    
    
    2,500Proceeds from sale of assets
    
    
    939
    
    
    
    Purchases of property and equipment
    
    
    (328
    )
    
    
    (433
    )Other
    
    
    86
    
    
    
    (57
    )Net Cash Provided By Investing Activities
    
    
    1,097
    
    
    
    10,243Financing ActivitiesProceeds from line of credit
    
    
    2,603
    
    
    
    Repayments on line of credit
    
    
    (3,971
    )
    
    
    (10,206
    )Repayments
on short-term obligations
    
    
    (8,414
    )
    
    
    (4,168
    )Proceeds from long-term obligations
    
    
    6,815
    
    
    
    Repayments on long-term obligations
    
    
    (224
    )
    
    
    (1,832
    )Net Cash Used In Financing Activities
    
    
    (3,191
    )
    
    
    (16,206
    )Decrease in Cash and Cash Equivalents
    
    
    (58
    )
    
    
    (199
    )Cash and Cash Equivalents at Beginning of Period
    
    
    391
    
    
    
    345Cash and Cash Equivalents at End of Period
    
    $
    333
    
    
    $
    146Supplemental cash flow disclosure:Interest paid
    
    $
    1,261
    
    
    $
    1,323


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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Maxco, Inc. and Subsidiaries
December 31, 2003
(Unaudited)

NOTE 1  BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

The accompanying unaudited, condensed, consolidated financial statements have
been prepared in accordance with accounting principles generally accepted in
the United States for interim financial information and with the instructions
to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not
include all of the information and notes required by accounting principles
generally accepted in the United States for complete financial statements.
In the opinion of management, all adjustments (consisting only of normal
recurring accruals) considered necessary for a fair presentation of the
results of the interim periods covered have been included. For further
information, refer to the consolidated financial statements and notes thereto
included in Maxcos annual report on Form 10-K for the year ended March 31,
2003.

The results of operations for the interim periods presented are not
necessarily indicative of the results for the full year. Maxcos sales and
operating results have varied substantially from quarter to quarter. Net
sales are typically lower in the second and third quarters. The most
significant factors affecting these fluctuations are the seasonal buying
patterns of the Companys customers due to a customer changeover and the
reduced number of business days during the holiday season. In addition, the
timing of acquisitions or the occasional sale of corporate investments may
cause substantial fluctuations of operating results from quarter to quarter.
Maxco expects its net sales and operating results to continue to fluctuate
from quarter to quarter.

NOTE 2  MARKETABLE SECURITIES

The Company classifies its investments in equity securities with readily
determinable fair values as securities available for sale under FASB 115,
Accounting for Certain Investments in Debt and Equity Securities.
Available-for-sale securities are carried at fair value, with the unrealized
gains and losses, net of tax, reported as a separate component of
stockholders equity. The Company recorded a charge of $26,000 in the
current quarter as an other than temporary impairment to the value of its
investment in Provant.

NOTE 3  EARNINGS PER SHARE

The following table sets forth the computation of basic and diluted earnings
per share:

Three Months Ended
    
    
    Nine Months EndedDecember 31,
    
    
    December 31,2003
    
    
    2002
    
    
    2003
    
    
    2002(in thousands, except per share data)NUMERATOR:Loss from continuing operations
    
    $
    (857
    )
    
    $
    (723
    )
    
    $
    (1,522
    )
    
    $
    (4,704
    )Income (loss) from discontinued operations
    
    
    
    
    
    
    151
    
    
    
    
    
    
    
    (1,510
    )Net loss
    
    
    (857
    )
    
    
    (572
    )
    
    
    (1,522
    )
    
    
    (6,214
    )Preferred stock dividends
    
    
    (102
    )
    
    
    (102
    )
    
    
    (306
    )
    
    
    (306
    )Numerator for basic and diluted earnings per shareloss available to common stockholders
    
    $
    (959
    )
    
    $
    (674
    )
    
    $
    (1,828
    )
    
    $
    (6,520
    )DENOMINATOR:Denominator for basic and diluted earnings per
shareweighted average shares
    
    
    3,101
    
    
    
    3,101
    
    
    
    3,101
    
    
    
    3,101BASIC AND DILUTED LOSS PER SHAREContinuing operations
    
    $
    (0.31
    )
    
    $
    (0.27
    )
    
    $
    (0.59
    )
    
    $
    (1.61
    )Discontinued operations
    
    
    
    
    
    
    0.05
    
    
    
    
    
    
    
    (0.49
    )$
    (0.31
    )
    
    $
    (0.22
    )
    
    $
    (0.59
    )
    
    $
    (2.10
    )


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NOTE 4  COMPREHENSIVE LOSS

The components of comprehensive loss for the three and nine months ended
December 31, 2003 and 2002 are as follows:

Three Months Ended
    
    
    Nine Months EndedDecember 31,
    
    
    December 31,2003
    
    
    2002
    
    
    2003
    
    
    2002(in thousands)Net loss
    
    $
    (857
    )
    
    $
    (572
    )
    
    $
    (1,522
    )
    
    $
    (6,214
    )Unrealized loss on marketable securities
    
    
    
    
    
    
    (56
    )
    
    
    
    
    
    
    (62
    )Unrealized gain (loss) on swap agreement
    
    
    28
    
    
    
    6
    
    
    
    67
    
    
    
    (169
    )Comprehensive loss
    
    $
    (829
    )
    
    $
    (622
    )
    
    $
    (1,455
    )
    
    $
    (6,445
    )


The components of accumulated comprehensive loss, net of related tax at
December 31, 2003 and March 31, 2003 are as follows:

December 31,
    
    
    March 31,2003
    
    
    2003(in thousands)Unrealized loss on marketable securities
    
    $
    
    
    
    $
    (56
    )Unrealized loss on swap agreement
    
    
    (175
    )
    
    
    (242
    )$
    (175
    )
    
    $
    (298
    )


NOTE 5  INDUSTRY SEGMENT INFORMATION

The following summarizes Maxcos industry segment information:

December 31,
    
    
    March 31,2003
    
    
    2003(in thousands)Identifiable
Assets:Heat treating
    
    $
    28,999
    
    
    $
    30,203Assets of discontinued operations
    
    
    
    
    
    
    474Corporate and other
    
    
    2,461
    
    
    
    3,580Investments and advances
    
    
    4,096
    
    
    
    4,165Total
Identifiable Assets
    
    $
    35,556
    
    
    $
    38,422


Three Months Ended
    
    
    Nine Months EndedDecember 31,
    
    
    December 31,2003
    
    
    2002
    
    
    2003
    
    
    2002(in thousands)Net Sales:Heat treating
    
    $
    10,562
    
    
    $
    8,663
    
    
    $
    29,280
    
    
    $
    26,448Corporate and other
    
    
    
    
    
    
    38
    
    
    
    44
    
    
    
    87Total Net Sales
    
    $
    10,562
    
    
    $
    8,701
    
    
    $
    29,324
    
    
    $
    26,535Operating Earnings (Loss):Heat treating
    
    $
    331
    
    
    $
    327
    
    
    $
    971
    
    
    $
    1,441Corporate and other
    
    
    (645
    )
    
    
    (657
    )
    
    
    (1,633
    )
    
    
    (2,163
    )Total Operating Loss
    
    $
    (314
    )
    
    $
    (330
    )
    
    $
    (662
    )
    
    $
    (722
    )Depreciation and Amortization Expense:Heat treating
    
    $
    741
    
    
    $
    740
    
    
    $
    2,177
    
    
    $
    2,220Corporate and other
    
    
    8
    
    
    
    13
    
    
    
    25
    
    
    
    43Total Depreciation and Amortization Expense
    
    $
    749
    
    
    $
    753
    
    
    $
    2,202
    
    
    $
    2,263Capital Expenditures:Heat treating
    
    $
    74
    
    
    $
    270
    
    
    $
    328
    
    
    $
    433Corporate and other
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total Capital Expenditures
    
    $
    74
    
    
    $
    270
    
    
    $
    328
    
    
    $
    433


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Accounting policies of the business segments are consistent with those
described in the summary of significant accounting policies (see Note 1).

Identifiable assets are those assets that are used in Maxcos operations in
each industry segment. Corporate assets are principally cash, notes
receivable, investments, and corporate office properties.

Maxco has no significant foreign operations or export sales.

The nature of the Companys services may produce sales to one or a small
number of customers in excess of 10% of total sales in any one period. It is
possible that the specific customers reaching this threshold may change from
year to year. Loss of any one of these customers could have a material
impact on the Companys results of operations.

NOTE 6  DEBT

In November 2003, Atmosphere Annealing reached an agreement with a new lender
for new facilities that are comprised of a $6.0 million revolving credit facility
($2.6 million outstanding at December 31, 2003 of which
$1.5 million was available), $6.4 million of term debt
with a 5 year amortization period, and $800,000 of term debt with a two year
amortization period. These facilities are secured by all of the assets of
Atmosphere Annealing. The proceeds from these facilities were used to
repay notes payable of a lender of approximately $8.1 million
which were in default.

The Company has $2.2 million of debt due a lender that is in default. This
debt is subject to a forbearance agreement that expires in April 2004 and has
been classified as current in the accompanying financial statements. The
expiration date is subject to the Companys ability to refinance certain real
estate by February 16, 2004, which has not occurred.

The Company has guaranteed various debt obligations of certain real estate
and other investments in an aggregate amount of approximately
$4.4 million as of December 31, 2003 ($3.9 million as
of February 17, 2004). Certain of the debt agreements related to its real
estate investments, which Maxco and others have guaranteed, are in default at
December 31, 2003. Extensions or forbearance agreements have been issued by
some of the respective lenders and the applicable entities are currently
working to liquidate the properties to satisfy the obligations. The Company
and one of the lenders have agreed to the process of foreclosure action and
the Companys exposure under the issue is limited to
$100,000. The Company has recorded $65,000 of this amount as of
December 31, 2003. The Company
does not believe that there is any unusual degree of risk related to these
guarantees because the underlying asset values substantially support the
respective debt obligations. In October 2003, the Company was named as a
defendant in a certain action from a lender as a result of the Company being
a guarantor of a real estate investment. The claim in this action is $1.0
million (reduced to $700,000 in February 2004); however, the Company believes
that the value of the underlying assets involved is sufficient to
substantially satisfy any potential judgment.

The
accompanying financial statements have been prepared on the basis
that the Company will continue as a going concern. The Companys ability to meet its short term and long term debt service and
other obligations (including compliance with financial covenants) will be
dependent upon its future operating performance. These dependencies will be
subject to financial, business and other factors, certain of which are beyond
the Companys control, such as prevailing economic conditions. There can be
no assurance that, in the event the Company was to require additional
financing, such additional financing would be available on satisfactory
terms. The Company believes that funds generated by its operations and funds
anticipated available under its new facilities will be sufficient to finance
short term capital needs, as well as to fund existing operations for the
foreseeable future. However, in the event that the Company is unable to
successfully negotiate its credit facilities, the Company has long term
equity investments that it is actively liquidating to meet its debt service
requirements.

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NOTE 7  FEDERAL INCOME TAXES

The Company did not recognize tax benefits on its losses during the current
quarter due to uncertainty on the realization of those benefits. As such,
the Company did not record income tax expense resulting in a variation from
the statutory rate of 34%.

NOTE 8  DIVIDENDS

Effective January 1, 2002, the Maxco Board of Directors suspended the payment
of dividends on all preferred stock. These dividend payments have been
accrued in the accompanying financial statements and totaled approximately
$917,000 at December 31, 2003.

NOTE 9  INVENTORIES

Inventories are stated at the lower of first-in, first-out cost or market and
consisted of the following:

December 31,
    
    
    March 31,2003
    
    
    2003(in thousands)Raw materials
    
    $
    581
    
    
    $
    Work in progress
    
    
    188
    
    
    
    156Finished goods
    
    
    
    
    
    
    20$
    769
    
    
    $
    176


NOTE 10  SALE OF REAL ESTATE PORTFOLIO

Maxco has ownership interests ranging from 25-50% in primarily two LLCs that
have been involved in the development and ownership of real estate in central
Michigan. Effective January 1, 2000, a Master LLC (L/M Associates II) was
formed consisting of the majority of the stabilized buildings in which Maxco
and others had an ownership interest. At March 31, 2003 Maxcos
effective ownership interest in the Master LLC was approximately 31%. The
other LLC (L/M Associates) includes properties under development that are not
fully leased or individual properties not included in the Master LLC.

In early 2002, Maxco, as managing member of L/M Associates, which is the
managing member of L/M Associates II, began negotiations to sell
substantially all of the properties in the real estate portfolio of L/M
Associates II. In June 2002, L/M Associates II entered into an agreement to
sell the properties within the Master LLC to an outside investor. The
transaction was approved by more than 75% of the member interests in July
2002. This transaction was completed in January 2003. As part of this
transaction, L/M Associates agreed to reinvest a portion of its distributable
share of the proceeds to acquire approximately a 16% interest in the
acquiring entity. By agreement, this investment may be purchased prior to
July 2004 by a member of the acquiring entity. After July 2004, L/M
Associates has the right to require the same member to purchase the
investment.

The Company is actively pursuing the liquidation of the remaining portion of
Maxcos real estate investments.

NOTE 11  DISCONTINUED OPERATIONS

Effective September 27, 2002, Maxco agreed to sell the business and
substantially all the assets (consisting principally of accounts receivable,
inventory and fixed assets) of Maxcos wholly owned subsidiary, Pak Sak
Industries, Inc. to Packaging Personified, Inc. and related parties. The
assets were purchased for cash and an assumption of certain liabilities. The
sale closed on November 27, 2002.

On November 14, 2002, Maxco completed an agreement to sell its wholly owned
subsidiary, Ersco Corporation to Contractor Supply Incorporated for cash and
retired certain other debt of Maxco in excess of the sale price resulting in
a note payable to the purchaser of approximately $4.0 million. The principal
balance of this note was reduced by $2.3 million in 2003 as the Company
assumed a liability of the purchaser.

The results of operations for these units have been reported separately as
discontinued operations in the consolidated statements of operations for the
periods ending December 31, 2002.

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NOTE 12  SALES OF LAND AND BUILDING

On April 15, 2003, the Company sold land it had previously held for sale for
$1.0 million, the proceeds of which were primarily used to retire debt. This
transaction resulted in a gain of $910,000.

In October 2003 the Company sold land and a building it was leasing to the
purchaser of the Companys discontinued business, Pak Sak Industries. The
proceeds of $400,000 were primarily used to retire debt. This transaction
resulted in a loss of approximately $74,000.

NOTE 13  NEW ACCOUNTING PRONOUNCEMENTS

FIN 46, Consolidation of Variable Interest Entities  an Interpretation of ARB No. 51

In January 2003, the FASB issued Interpretation (FIN) 46, Consolidation of
Variable Interest Entities  an Interpretation of ARB No. 51, in October
2003 issued a modification of FIN 46, and revised the interpretation in
December 2003. This interpretation provides guidance related to identifying
variable interest entities (VIEs, previously known as special purpose
entities or SPEs) and determining whether such entities should be
consolidated. Certain disclosures are required if it is reasonably possible
that a company will consolidate or disclose information about a VIE when it
initially applies FIN 46. This interpretation must be applied immediately to
VIEs created or obtained after January 31, 2003. Since January 31, 2003, the
Company has not participated in the creation of, or obtained a new variable
interest in, any VIE. For those VIEs created or obtained on or before
January 31, 2003, the Company must apply the provisions of FIN 46 in the
fourth quarter of fiscal 2004. The Company has not determined what impact
adopting this standard will have on its financial statements.

Maxco
has an ownership investment in two real estate entities (see note
10) that had been involved in the development and ownership of real estate in
Central Michigan. Maxco has divested itself of a significant portion of
these holdings and is actively pursuing the liquidation of the remaining
portion of its real estate investment. Any real estate entities that Maxco
is involved with and are determined to be VIEs will be required to be
consolidated into the companys financial statements as of March 31, 2004.

The
estimated net asset value of the real estate portfolio is $3 million at
December 31, 2003 consisting of an estimated fair value of approximately $27
million with mortgages and other payables outstanding of
approximately $24 million.

Maxcos estimated maximum exposure to loss as a result of its involvement
with its potential real estate variable interest entities is $3.0 million.
This amount is recorded in the accompanying financial statement under
advances to affiliates at approximately $3.0 million at December 31, 2003.

As mentioned in Note 6, the Company has guaranteed various debt obligations
of certain real estate and other investments in an aggregate amount of
approximately $4.4 million as of December 31, 2003 ($3.9 million as of February 17, 2004). Certain of the debt
agreements related to its real estate investments, which Maxco and others
have guaranteed, are in default at December 31, 2003. Extensions or
forbearance agreements have been issued by some of the respective lenders and
the applicable entities are currently working to liquidate the properties to
satisfy the obligations. The Company and one of the lenders have agreed to
the process of foreclosure action and the Companys exposure under the issue
is limited to $100,000. The Company has recorded $65,000 of this
amount as of December 31, 2003. The Company does not believe that there is any
unusual degree of risk related to these guarantees because the underlying
asset values substantially support the respective debt obligations. In
October 2003, the Company was named as a defendant in a certain action from a
lender as a result of the Company being a guarantor of a real estate
investment. The claim in this action is $1.0 million (reduced to $700,000 in
February 2004); however, the Company believes that the value of the
underlying assets involved is sufficient to substantially satisfy any
potential judgment.

SFAS No. 149, Amendment of Statement 133 on Derivative Instruments and
Hedging Activities"

In April 2003 the FASB issued SFAS No. 149 which amends and clarifies
financial accounting and reporting for derivative instruments, including
certain derivative instruments embedded in other contracts and for hedging
activities under SFAS No. 133, Accounting for Derivative Instruments and
Hedging Activities. This statement clarifies under what circumstances a
contract with an initial net investment meets the characteristic of a
derivative discussed in paragraph 6(b) of SFAS No. 133, clarifies when a
derivative contains a financing component, amends the definition of an underlying to conform to language used in FASB
Interpretation No. 45, and amends certain other existing

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pronouncements.
This statement is effective for contracts entered into or modified after June
30, 2003. It is not expected that the provisions of Statement No. 149 will
have a material impact on the financial position or results of operations of
the Company.

SFAS No. 150, Accounting for Certain Financial Instruments with
Characteristics of both Liabilities and Equity

In May 2003 the FASB issued SFAS No. 150, which establishes standards for how
an issuer classifies and measures certain financial instruments with
characteristics of both liabilities and equity. It requires that an issuer
classify a financial instrument that is within its scope as a liability (or
an asset in some circumstances). This statement is effective for financial
instruments entered into or modified after May 31, 2003, and otherwise is
effective at the beginning of the first interim period beginning after June
15, 2003. It is to be implemented by reporting the cumulative effect of a
change in accounting principle for financial instruments created before the
issuance date of the Statement and still existing at the beginning of the
interim period of adoption. There was no impact of adoption on the financial
statements of the Company.

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

MATERIAL CHANGES IN FINANCIAL CONDITION

Cash provided by operating activities amounted to $2.0 million for the nine
months. Earnings, after non-cash adjustments, generated $313,000 while changes
in working capital components generated approximately $1.7 million.

Cash was generated by investing activities during the period as a result of the
sales of land and a building that were owned by the Company. These proceeds
were used primarily to retire debt. The Companys heat treating segment
purchased approximately $328,000 of equipment during the period.

Net
repayments on debt obligations amounted to $3.2 million for the nine month
period.

In November 2003, Atmosphere Annealing reached an agreement with a new lender
for new facilities that are comprised of a $6.0 million revolving credit facility
($2.6 million outstanding at December 31, 2003 of which $1.5 million was available), $6.4 million of term debt with
a 5 year amortization period, and $800,000 of term debt with a two year
amortization period. These facilities are secured by all of the assets of
Atmosphere Annealing. The proceeds from these new facilities were
used to repay notes payable of a lender of approximately $8.1 million
which were in default.

The Company has $2.2 million of debt due a lender that is in default. This
debt is subject to a forbearance agreement that expires in April 2004 and has
been classified as current in the accompanying financial statements. The
expiration date is subject to the Companys ability to refinance certain real
estate by February 16, 2004, which has not occurred.

The Company has guaranteed various debt obligations of certain real estate and
other investments in an aggregate amount of approximately
$4.4 million as of December 31, 2003. ($3.9 million as of
February 17, 2004). Certain of the debt agreements related to its real estate
investments, which Maxco and others have guaranteed, are in default at December
31, 2003. Extensions or forbearance agreements have been issued by some of the
respective lenders and the applicable entities are currently working to
liquidate the properties to satisfy the obligations. The Company and one of
the lenders have agreed to the process of foreclosure action and the Companys
exposure under the issue is limited to $100,000. The Company has
recorded $65,000 of this amount as of December 31, 2003. The Company does not believe
that there is any unusual degree of risk related to these guarantees because
the underlying asset values substantially support the respective debt
obligations. In October 2003, the Company was named as a defendant in a
certain action from a lender as a result of the Company being a guarantor of a
real estate investment. The claim in this action is $1.0 million (reduced to
$700,000 in February 2004); however, the Company believes that the value of the
underlying assets involved is sufficient to substantially satisfy any potential
judgment.

The Companys ability to meet its short term and long term debt service and
other obligations (including compliance with financial covenants) will be
dependent upon its future operating performance and the successful
renegotiation of its credit facility. These dependencies will be subject to
financial, business and other factors, certain of which are beyond the
Companys control, such as prevailing economic conditions. There can be no
assurance that, in the event the Company was to require additional financing,
such additional financing would be available on satisfactory terms. The
Company believes that funds generated by its operations and funds anticipated
available under its new facilities will be sufficient to finance short term
capital needs, as well as to fund existing operations for the foreseeable
future. However, in the event that the Company is unable to successfully
negotiate its credit facilities, the Company has long term equity investments
that it is actively liquidating to meet its debt service requirements.

At December 31, 2003, the 2,240,605 shares of Integral Vision (formerly Medar)
common stock that Maxco owns had an aggregate market value of approximately
$807,000 ($2.4 million at February 12, 2004). Maxcos investment in Integral
Vision is reflected in Maxcos financial statements under the equity method for
all periods presented, as the Company owns greater than 20% of Integral
Visions outstanding stock. There are 8.6 million exercisable warrants outstanding
which, if exercised, would reduce Maxcos ownership to
approximately 13%.

At December 31, 2003, the 2,837,089 shares of Provant common stock that Maxco
owns had an aggregate market value of approximately $2,000. Maxcos investment
in Provant is reflected in Maxcos financial statements under the cost method
as an available-for-sale security as the Company owns less than 20% of
Provants outstanding stock.

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MATERIAL CHANGES IN RESULTS OF OPERATIONS

Three Months Ended December 31, 2003 Compared to 2002

Net sales increased to $10.6 million compared to $8.7 million in last years
third quarter. Third quarter results reflect an operating loss of $314,000
compared to a loss of $330,000 for the comparable period in 2002. Net loss was
$857,000 or $.31 per share assuming dilution compared to last years net loss
of $572,000 or $.22 per share assuming dilution.

Sales and operating earnings for the three months ending December 31, 2003 and
2002 by the Companys heat treating and corporate and other segments were as
follows:

Three Months Ended
    
    
    Three Months EndedDecember 31, 2003
    
    
    December 31, 2002Operating
    
    
    
    
    
    
    OperatingNet Sales
    
    
    Earnings (Loss)
    
    
    Net Sales
    
    
    Earnings (Loss)(in thousands)Heat treating
    
    $
    10,562
    
    
    $
    331
    
    
    $
    8,663
    
    
    $
    327Corporate and other
    
    
    
    
    
    
    (645
    )
    
    
    38
    
    
    
    (657
    )$
    10,562
    
    
    $
    (314
    )
    
    $
    8,701
    
    
    $
    (330
    )


The increase in net sales at the Companys heat treating segment, Atmosphere
Annealing (Atmosphere), was primarily due to increased business with Honda of
America Manufacturing, Inc. In addition to modest increases in sales to
certain other of Atmospheres existing customers, sales to new customers also
contributed to the overall increase in net sales. These increases were
partially offset by decreases in sales to customers who either cut production
due to economic conditions or moved a portion of their heat treating
requirements in-house or to another vendor.

Consolidated gross profit (net sales less cost of sales and operating expenses)
increased to $3.4 million from $3.3 million in the prior year period. Gross
margin (gross profit as a percentage of net sales) decreased from 38% to 32%.
Gross margin decreased primarily as a result of the increased sales to Honda.
By agreement, the Company is required to purchase and bill Honda for the steel
used in the heat treating process resulting in lower margins. Atmospheres
operating expenses were comparable to the prior year period with reductions in
the costs of labor ($82,000), shop supplies ($37,000), and shipping ($12,000)
offsetting increases in the costs of maintenance ($69,000) and natural gas and
nitrogen ($62,000).

Selling,
general, and administrative (SG&A) expenses were approximately
$2.9 million for both periods. At Atmosphere, employee costs,
primarily healthcare, increased by $181,000 while general insurances were lower
by $67,000. Corporate SG&A expenses were lower primarily as a
result of a reduction in legal expenses of $87,000.

Depreciation and amortization expense was comparable to the prior year period.

As a result of the above, operating loss decreased to a loss of approximately
$314,000 from a loss of $330,000 in last years comparable period.

Investment and other income (loss) decreased from income of $53,000 to a loss
of $91,000. The Company recorded a charge of $26,000 in the current quarter as
an other than temporary impairment to the value of its investment in Provant.
The Company recorded a charge of $65,000 in the current quarter to recognize
its estimated liability as a result of a foreclosure action.

Interest income decreased to $40,000 from $144,000. In fiscal 2003, the
Company ceased the recording of interest income on certain notes when it was
determined that any further amount would be uncollectible. The carrying value
of the notes and accrued interest were adjusted in fiscal 2003 to estimated
realizable values.

Equity
in earnings of affiliates was $50,000 in the current quarter compared
to a loss of $76,000 in the prior year period.

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Nine Months Ended December 31, 2003 Compared to 2002

Net sales increased to $29.3 million compared to $26.5 million in last years
comparable period. Results from this period reflect an operating loss of
$662,000 compared to a loss of $722,000 for the comparable period in 2002. Net
loss was $1.5 million or $.59 per share assuming dilution compared to last
years net loss of $6.2 million or $2.10 per share assuming dilution.

Sales and operating earnings for the nine months ending December 31, 2003 and
2002 by the Companys heat treating and corporate and other segments were as
follows:

Nine Months Ended
    
    
    Nine Months EndedDecember 31, 2003
    
    
    December 31, 2002Operating
    
    
    
    
    
    
    OperatingNet Sales
    
    
    Earnings (Loss)
    
    
    Net Sales
    
    
    Earnings (Loss)(in thousands)Heat treating
    
    $
    29,280
    
    
    $
    971
    
    
    $
    26,448
    
    
    $
    1,441Corporate and other
    
    
    44
    
    
    
    (1,633
    )
    
    
    87
    
    
    
    (2,163
    )$
    29,324
    
    
    $
    (662
    )
    
    $
    26,535
    
    
    $
    (722
    )


The increase in net sales at the Companys heat treating segment, Atmosphere
Annealing (Atmosphere), was primarily due to increased business with Honda of
America Manufacturing, Inc. In addition to modest increases in sales to
certain other of Atmospheres existing customers, sales to new customers also
contributed to the overall increase in net sales. These increases were
partially offset by decreases in sales to customers who either cut production
due to economic conditions or moved a portion of their heat treating
requirements in-house or to another vendor.

Consolidated gross profit (net sales less cost of sales and operating expenses)
decreased to $9.9 million from $10.0 million. Gross margin (gross profit as a
percentage of net sales) decreased from 38% to 34%. The decrease in heat
treating sales to a customer who moved a portion of their heat treating
requirements in-house or to another vendor was the primary reason that gross
profit declined from the prior year. Gross margin decreased primarily as a
result of the increased sales to Honda. By agreement, the Company is required
to purchase and bill Honda for the steel used in the heat treating process
resulting in lower margins. Atmosphere decreased their operating expenses
through reductions in the costs of labor ($388,000), maintenance ($28,000),
equipment rental ($98,000), and shipping ($85,000).

Selling,
general, and administrative expenses decreased to $8.4 million from
$8.5 million in the prior year period. Increases in employee
costs ($245,000) and general insurances ($134,000) at Atmosphere were offset by lower employee
($135,000), legal ($124,000) and financing costs ($373,000) at corporate.

Depreciation and amortization expense was comparable to the prior year period.

As a result of the above, operating loss decreased to a loss of approximately
$662,000 from a loss of $722,000 in last years comparable period.

Investment and other losses improved from a loss of $1.6 million to a loss of
$431,000. The Company recorded charges totaling $1.4 in the prior year period
as an other than temporary impairment to the value of its investment in
Provant.

Interest income decreased to $114,000 from $548,000. In fiscal 2003, the
Company ceased the recording of interest income on certain notes when it was
determined that any further amount would be uncollectible. The carrying value
of the notes and accrued interest were adjusted in fiscal 2003 to estimated
realizable values.

Gain on sale of assets includes a net gain of $836,000 from sales of land and a
building in the current period and $149,000 for gains on sales of buildings in
the prior year period.

In the current period, the Company recorded $90,000 in equity in losses of
affiliates to adjust its investment in Integral Vision to an estimated
realizable amount. The Company also recorded $50,000 of income in the
current period as its proportionate share of the earnings of its
unconsolidated affiliates. Equity in loss of affiliates was $2.5 million in the prior
year period.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Companys variable interest expense is sensitive to changes in the general
level of United States interest rates. While approximately $2.1 million of
Maxcos debt carries a fixed rate of interest, the Company entered into an
interest rate swap agreement based on a notional amount of $2.7 million to
manage its exposure to interest rate changes. The swap involves the exchange
of fixed and variable interest payments without changing the notional principal
amount. The Company had total outstanding variable rate short and long term
borrowings of $12.1 million at December 31, 2003. A 1% increase from the
prevailing interest rates at December 31, 2003 on the unhedged variable rate
portion of the Companys short and long-term borrowings would increase interest
expense on an annualized basis by approximately $121,000 based on principal
balances at December 31, 2003.




ITEM 4. DISCLOSURE CONTROLS AND PROCEDURES

The Companys Chief Executive Officer and Chief Financial Officer believe
Maxcos disclosure controls and procedures, as defined in Securities Exchange
Act Rules 13a-15(e) and 15d-15(e), are effective. This conclusion was reached
after an evaluation of these controls and procedures as of December 31, 2003.

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##### Table of Contents






PART II

OTHER INFORMATION




Item 1. Legal Proceedings

In October 2003, the Company was named as a defendant in a certain
action from a lender as a result of the Company being a guarantor of
a real estate investment. The Companys exposure in this action is
$1.0 million (reduced to $700,000 in February 2004); however, the
Company believes that the value of the underlying asset involved is
sufficient to satisfy any potential judgment.




Item 2. Changes in Securities

None




Item 3. Defaults Upon Senior Securities

None




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

The annual meeting of shareholders was held on January 13, 2004. The
matters voted upon were the election of directors and other business
that may come before the meeting (of which there was none). The
results of votes were as follows:

Election of directors:

For
    
    
    WithheldMax A. Coon
    
    
    2,915,728
    
    
    
    14,333Eric L. Cross
    
    
    2,923,628
    
    
    
    7,433Sanjeev Deshpande
    
    
    2,923,636
    
    
    
    7,425Charles J. Drake
    
    
    2,920,731
    
    
    
    10,330Joel I. Ferguson
    
    
    2,920,583
    
    
    
    10,478Richard G. Johns
    
    
    2,923,828
    
    
    
    7,233David R. Layton
    
    
    2,920,636
    
    
    
    10,425Samuel O. Mallory
    
    
    2,923,231
    
    
    
    7,830Vincent Shunsky
    
    
    2,924,128
    
    
    
    6,933





Item 5. Other Information

None

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Item 6(a)       Exhibits

3
    
    Restated Articles of Incorporation are hereby incorporated from Form 10-Q dated February 13, 1998.3.1
    
    By-laws are hereby incorporated by reference from Form S-4 dated November
4, 1991 (File No. 33-43855).4.2
    
    Resolution establishing Series Three Preferred Shares is hereby
incorporated by reference from Form S-4 dated November 4, 1991 (File No.
33-43855).4.3
    
    Resolution authorizing the redemption of Series Two Preferred Stock and
establishing Series Four Preferred Stock and the terms of the subordinated
notes is hereby incorporated by reference from Form 10-Q dated February
14, 1997.4.4
    
    Resolution establishing Series Five Preferred Shares is hereby
incorporated by reference from Form 10-K dated June 5, 1997.4.5
    
    Resolution establishing Series Six Preferred Shares is hereby
incorporated by reference from Form 10-K dated June 23, 1999.10.1
    
    Incentive stock option plan adopted August 15, 1983, including the
amendment (approved by shareholders August 25, 1987) to increase the
authorized shares on which options may be granted by two hundred fifty
thousand (250,000), up to five hundred thousand (500,000) shares of the
common stock of the company is hereby incorporated by reference from the
registrants annual report on Form 10-K for the fiscal year ended March
31, 1988.10.9
    
    Asset purchase agreement  Wright Plastic Products, Inc. is hereby
incorporated by reference from Form 10-Q dated November 14, 1996.10.10
    
    Amended and restated loan agreement between Comerica Bank and Maxco,
Inc. dated September 30, 1996 is hereby incorporated by reference from
Form 10-Q dated November 14, 1996.10.11
    
    Asset purchase agreement for the purchase of Atmosphere Annealing, Inc.
is hereby incorporated by reference from Form 8-K dated January 17, 1997.10.15
    
    First Amendment to amended and restated loan agreement between Comerica
Bank and Maxco, Inc. dated August 1, 1997, is hereby incorporated by
reference from Form 10-K dated June 24, 1998.10.16
    
    Second amendment to amended and restated loan agreement between Comerica
Bank and Maxco, Inc. dated June 24, 1998 is hereby incorporated by
reference from Form 10-K dated June 24, 1998.10.17
    
    Third amendment to amended and restated loan agreement between Comerica
Bank and Maxco, Inc. dated September 24, 1998, is hereby incorporated by
reference from Form 10-Q dated November 12, 1998.10.18
    
    Maxco, Inc. 1998 Employee Stock Option Plan is hereby incorporated by
reference from Form 10-Q dated November 12, 1998.10.19
    
    Fourth amendment to amended and restated loan agreement between Comerica
Bank and Maxco, Inc. dated June 22, 1999, is hereby incorporated by
reference from Form 10-K dated June 23, 1999.10.20
    
    Fifth amendment to amended and restated loan agreement between Comerica
Bank and Maxco, Inc. dated September 1, 1999 is hereby incorporated by
reference from Form 10-Q dated November 12, 1999.


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10.21
    
    Sixth amendment to amended and restated loan agreement between Comerica
Bank and Maxco, Inc. dated July 12, 2000 is hereby incorporated by
reference from Form 10-K dated July 14, 2000.10.22
    
    Seventh amendment to amended and restated loan agreement between
Comerica Bank and Maxco, Inc. dated January 11, 2000 is hereby
incorporated by reference from Form 10-Q dated February 14, 2001.10.23
    
    Eighth amendment to amended and restated loan agreement between Comerica
Bank and Maxco, Inc. dated March 19, 2001 is hereby incorporated by
reference from Form 10-K dated July 13, 2001.10.24
    
    Ninth amendment to amended and restated loan agreement between Comerica
Bank and Maxco, Inc. dated October 1, 2001 is hereby incorporated by
reference from Form 10-Q dated February 19, 2002.10.25
    
    Tenth amendment to amended and restated loan agreement between Comerica
Bank and Maxco, Inc. dated February 19, 2002 is hereby incorporated by
reference from Form 10-K dated July 16, 2002.10.26
    
    Financing arrangements among Comerica Bank, Maxco, Inc., Ersco
Corporation, Pak Sak Industries, Inc., and Max A. Coon dated November 8,
2002 is hereby incorporated by reference from Form 10-Q dated November 25,
2002.10.27
    
    Financing arrangements among Comerica Bank, Maxco, Inc., Pak Sak
Industries, Inc., and Max A. Coon dated November 13, 2002 is hereby
incorporated by reference from Form 10-Q dated November 25, 2002.10.28
    
    Assignment agreement among Comerica Bank, Contractor Supply
Incorporated, Maxco, Inc., Ersco Corporation, Pak Sak, Inc., Max A. Coon,
and Ambassador Steel Corporation dated November 13, 2002 is hereby
incorporated by reference from Form 10-Q dated November 25, 2002.10.29
    
    Obligor assignment agreement among Contractor Supply Incorporated,
Maxco, Inc., and Ersco Corporation dated November 14, 2002 is hereby
incorporated by reference from Form 10-Q dated November 25, 2002.10.30
    
    Stock purchase agreement between Ersco Corporation, Maxco, Inc., and
Contractor Supply Incorporated dated November 14, 2002 is hereby
incorporated by reference from Form 10-Q dated November 25, 2002.10.31
    
    Asset Purchase Agreement between Pak Sak Industries, Inc., Maxco, Inc.,
P-S Business Acquisition, Inc., and P&D Real Estate, LLC and Packaging
Personified, Inc. dated September 27, 2002 is hereby incorporated by
reference from Form 10-Q dated February 14, 2003.10.32
    
    First Amendment to Asset Purchase Agreement between Pak Sak Industries,
Inc., Maxco, Inc., P-S Business Acquisition, Inc., and P&D Real Estate,
LLC and Packaging Personified, Inc. dated October 30, 2002 is hereby
incorporated by reference from Form 10-Q dated February 14, 2003.10.33
    
    Second Amendment to Asset Purchase Agreement between Pak Sak Industries,
Inc., Maxco, Inc., P-S Business Acquisition, Inc., and P&D Real Estate,
LLC and Packaging Personified, Inc. dated November 25, 2002 is hereby
incorporated by reference from Form 10-Q dated February 14, 2003.10.34
    
    Credit Agreement between Atmosphere Annealing, Inc. and Huntington
National Bank dated November 18, 2003 is hereby incorporated by reference
from Form 10-Q dated November 19, 2003.10.35
    
    Subordination Agreement between Maxco, Inc., Atmosphere Annealing, Inc.
and Comerica Bank and Huntington National Bank dated November 18, 2003 is
hereby incorporated by reference from Form 10-Q dated November 19, 2003.31.1
    
    Certification of Chief Executive Officer of periodic report pursuant to
Rule 13a-15(e) or Rule 15d-15(e).


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31.2
    
    Certification of Chief Financial Officer of periodic report pursuant to
Rule 13a-15(e) or Rule 15d-15(e).32.1
    
    Certification of Chief Executive Officer of periodic report pursuant to 18 U.S.C. §1350.32.2
    
    Certification of Chief Financial Officer of periodic report pursuant to 18 U.S.C. §1350.





Item 6(b)        Reports on Form 8-K

None

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

MAXCO, INC.Date:
    February 17, 2004
    
    /s/ VINCENT SHUNSKYVincent Shunsky, Vice President-Financeand Treasurer (Principal Financial andAccounting Officer)


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Exhibit Index

No.
    
    Description31.1
    
    Certification of Chief Executive Officer of periodic report pursuant to
Rule 13a-15(e) or Rule 15d-15(e).31.2
    
    Certification of Chief Financial Officer of periodic report pursuant to
Rule 13a-15(e) or Rule 15d-15(e).32.1
    
    Certification of Chief Executive Officer of periodic report pursuant to
18 U.S.C. §1350.32.2
    
    Certification of Chief Financial Officer of periodic report pursuant to 18
U.S.C. §1350.


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