TABLE OF CONTENTS




| |                                                                                                |                                                                                                                                           |  |  |  |  |  | 
| | ---------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------- |  |  |  |  |  | 
| | PART I  FINANCIAL INFORMATION                                                                
| | Item 1 - Financial Statements                                                                 
| |                                                                                                | CONSOLIDATED BALANCE SHEETS
JANUARY 29, 2000 AND OCTOBER 30, 1999                                                                        
| |                                                                                                | CONSOLIDATED STATEMENTS OF NET INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS) FOR THE 13 WEEKS ENDED JANUARY 29, 2000 AND JANUARY 30, 1999
| |                                                                                                | CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE 13 WEEKS ENDED JANUARY 29, 2000 AND JANUARY 30, 1999                                       
| |                                                                                                | NOTES TO CONSOLIDATED FINANCIAL STATEMENTS                                                                                               
| | ITEM 2 - MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
| | ITEM 3 - QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK                            
| | PART II  OTHER INFORMATION                                                                   
| | Item 6  Exhibits and Reports on Form 8-K                                                     
| | SIGNATURE                                                                                     



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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended January 29, 2000, or

Transition report pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

|
|

For the transition period from  to .

Commission file number 333-38223

ARGO-TECH CORPORATION(Exact name of registrant as specified in its charter)

|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|Delaware                                                       |  | 31-1521125                          
|                                                              
|                                                              
|                                                              
|                                                              
|(State or other jurisdiction of
incorporation or organization) |  | (I.R.S. employer
identification no.)
|                                                              
|                                                              
|                                                              
|                                                              
|                                                              
|                                                              
|23555 Euclid Avenue                                           
|                                                              
|                                                              
|                                                              
|                                                              
|Cleveland, Ohio
(Address of principal executive offices)       |  | 44117
(Zip code)                    
|                                                              
|                                                              
|                                                              
|                                                              
|                                                              
|(216) 692-6000                                                
|                                                              
|                                                              
|                                                              
|                                                              
|(Registrants telephone
number, including area code)          

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.     X YES      NO



| |  |  | All of the outstanding capital stock of the registrant is held by
AT Holdings Corporation.     
| |  |  | -----------------------------------------------------------------------------------------------
|
| |  |  | As of March 1, 2000, 1 share of the registrants common stock,
$.01 par value, was outstanding.





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##### Table of Contents



INDEX

|                                                                                               |  |                                                                                                                                           |        |  |       |  |  |  |  | 
|---------------------------------------------------------------------------------------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------- | ------ |  | ----- |  |  |  |  | 
|PART I - FINANCIAL INFORMATION                                                                
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|Item 1 - Financial Statements                                                                  |  |                                                                                                                                          
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                               |  | Consolidated Balance Sheets as of January 29, 2000 and October 30, 1999                                                                   |        |  | 3     | 
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                               |  | Consolidated Statements of Net Income (Loss) and Comprehensive Income (Loss)
for the 13 weeks ended January 29, 2000 and January 30, 1999 |        |  | 4     | 
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                               |  | Consolidated Statements of Cash Flows for the 13 weeks ended January 29, 2000
and January 30, 1999                                        |        |  | 5     | 
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                               |  | Notes to Consolidated Financial Statements                                                                                                |        |  | 6 - 8 | 
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|Item 2 - Managements Discussion and Analysis of Financial Condition and Results
of Operations |  |                                                                                                                                           | 8 - 11 | 
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|Item 3 - Quantitative and Qualitative Disclosure about Market Risk                             |  |                                                                                                                                           | 11     | 
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|PART II - OTHER INFORMATION                                                                   
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|Item 6 - Exhibits and Reports on Form 8-K                                                      |  |                                                                                                                                           | 11     | 
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|Signature                                                                                      |  |                                                                                                                                           | 12    





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##### Table of Contents









PART I  FINANCIAL INFORMATION







ARGO-TECH CORPORATION AND SUBSIDIARIES
(A Wholly-Owned Subsidiary of AT Holdings Corporation)







CONSOLIDATED BALANCE SHEETS
JANUARY 29, 2000 AND OCTOBER 30, 1999
(In thousands, except share data)

|                                                        |                     |                                                                                       |                                         |        |             |         |         |        |         |         |  
|------------------------------------------------------- | ------------------- | ------------------------------------------------------------------------------------- | --------------------------------------- | ------ | ----------- | ------- | ------- | ------ | ------- | ------- | -
|                                                        |                     |                                                                                       |                                         |        | 2000        |         | 1999   
|                                                        |                     |                                                                                       |                                         |        |             |         |        
|                                                        |                     |                                                                                       |                                         |        | (Unaudited)
|ASSETS                                                 
|                                                       
|                                                       
|                                                       
|                                                       
|CURRENT ASSETS:                                        
|                                                       
|                                                       
|                                                       
|                                                       
|                                                        |                     | Cash and cash equivalents                                                             |                                         | $      | 3,217       |         |         | $      | 3,873   |        
|                                                       
|                                                       
|                                                       
|                                                       
|                                                        |                     | Receivables, net                                                                      |                                         |        | 23,065      |         |         |        | 30,169  |        
|                                                       
|                                                       
|                                                       
|                                                       
|                                                        |                     | Inventories                                                                           |                                         |        | 36,469      |         |         |        | 34,043  |        
|                                                       
|                                                       
|                                                       
|                                                       
|                                                        |                     | Deferred income taxes and prepaid expenses                                            |                                         |        | 6,364       |         |         |        | 5,322   |        
|                                                        |                     |                                                                                       |                                         |        |             |         |         |       
|                                                        |                     |                                                                                       | Total current assets                    |        |             | 69,115  |         |        |         | 73,407  |  
|                                                        |                     |                                                                                       |                                         |        |             |         |         |       
|PROPERTY AND EQUIPMENT, net of
accumulated depreciation |                     |                                                                                       | 34,621                                  |        |             |         | 35,653  |       
|                                                       
|                                                       
|                                                       
|                                                       
|GOODWILL, net of accumulated amortization               |                     |                                                                                       | 115,065                                 |        |             |         | 115,942 |       
|                                                       
|                                                       
|                                                       
|                                                       
|INTANGIBLE ASSETS, net of accumulated amortization      |                     |                                                                                       | 51,196                                  |        |             |         | 52,202  |       
|                                                       
|                                                       
|                                                       
|                                                       
|DEFERRED FINANCING AND OTHER ASSETS                     |                     |                                                                                       | 16,891                                  |        |             |         | 17,541  |       
|                                                        |                     |                                                                                       |                                         |        |             |         |         |       
|Total Assets                                            |                     | $                                                                                     | 286,888                                 |        |             | $       | 294,745 |       
|                                                        |                     |                                                                                       |                                         |        |             |         |         |       
|LIABILITIES                                            
|                                                       
|                                                       
|                                                       
|                                                       
|CURRENT LIABILITIES:                                   
|                                                       
|                                                       
|                                                       
|                                                       
|                                                        |                     | Current portion of long-term debt                                                     |                                         | $      | 9,878       |         |         | $      | 12,454  |        
|                                                       
|                                                       
|                                                       
|                                                       
|                                                        |                     | Accounts payable                                                                      |                                         |        | 3,961       |         |         |        | 6,647   |        
|                                                       
|                                                       
|                                                       
|                                                       
|                                                        |                     | Accrued liabilities                                                                   |                                         |        | 20,684      |         |         |        | 18,928  |        
|                                                        |                     |                                                                                       |                                         |        |             |         |         |       
|                                                        |                     |                                                                                       | Total current liabilities               |        |             | 34,523  |         |        |         | 38,029  |  
|                                                        |                     |                                                                                       |                                         |        |             |         |         |       
|LONG-TERM DEBT, net of current maturities               |                     |                                                                                       | 262,259                                 |        |             |         | 264,533 |       
|                                                       
|                                                       
|                                                       
|                                                       
|OTHER NONCURRENT LIABILITIES                            |                     |                                                                                       | 27,384                                  |        |             |         | 27,926  |       
|                                                        |                     |                                                                                       |                                         |        |             |         |         |       
|                                                        |                     |                                                                                       | Total Liabilities                       |        |             | 324,166 |         |        |         | 330,488 |  
|                                                        |                     |                                                                                       |                                         |        |             |         |         |       
|REDEEMABLE ESOP STOCK                                   |                     |                                                                                       | 33,860                                  |        |             |         | 50,772  |       
|                                                       
|                                                       
|                                                       
|                                                       
|                                                        | Unearned ESOP stock |                                                                                       |                                         | (7,140 | )           |         |         | (7,560 | )      
|                                                        |                     |                                                                                       |                                         |        |             |         |         |       
|                                                        |                     |                                                                                       | 26,720                                  |        |             |         | 43,212  |       
|                                                       
|                                                       
|                                                       
|                                                       
|SHAREHOLDERS EQUITY/(DEFICIENCY):                     
|                                                       
|                                                       
|                                                       
|                                                       
|                                                        |                     | Common Stock, $.01 par value, authorized 3,000 shares;
1 share issued and outstanding |                                         |        |            |         |         |        |        |        
|                                                       
|                                                       
|                                                       
|                                                       
|                                                        |                     | Paid-in capital                                                                       |                                         |        |            |         |         |        |        |        
|                                                       
|                                                       
|                                                       
|                                                       
|                                                        |                     | Accumulated deficit                                                                   |                                         |        | (63,998     | )       |         |        | (78,955 | )      
|                                                        |                     |                                                                                       |                                         |        |             |         |         |       
|                                                       
|                                                       
|                                                       
|                                                       
|                                                        |                     |                                                                                       | Total shareholders equity/(deficiency) |        |             | (63,998 | )       |        |         | (78,955 | )
|                                                        |                     |                                                                                       |                                         |        |             |         |         |       
|Total Liabilities and Shareholders Equity/(Deficiency) |                     | $                                                                                     | 286,888                                 |        |             | $       | 294,745 |       
|                                                        |                     |                                                                                       |                                         |        |             |         |         |       

The accompanying notes to consolidated financial statements are an integral part of this statement.



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##### Table of Contents



ARGO-TECH CORPORATION AND SUBSIDIARIES
(A Wholly-Owned Subsidiary of AT Holdings Corporation)







CONSOLIDATED STATEMENTS OF NET INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS)
FOR THE 13 WEEKS ENDED JANUARY 29, 2000 AND JANUARY 30, 1999

(In thousands)
UNAUDITED

|                                        |                                                                     |   |        |        |      |   |        |        | 
|--------------------------------------- | ------------------------------------------------------------------- | - | ------ | ------ | ---- | - | ------ | ------ | 
|                                        |                                                                     |   | 2000   |        | 1999
|                                        |                                                                     |   |        |        |     
|Net revenues                            |                                                                     | $ | 35,830 |        |      | $ | 40,143 |       
|                                       
|                                       
|                                       
|                                       
|Cost of revenues                        |                                                                     |   | 22,164 |        |      |   | 21,993 |       
|                                        |                                                                     |   |        |        |      |   |        |       
|                                        | Gross profit                                                        |   |        | 13,666 |      |   |        | 18,150 | 
|                                        |                                                                     |   |        |        |      |   |        |       
|Selling, general and administrative     |                                                                     |   | 6,065  |        |      |   | 8,796  |       
|                                       
|                                       
|                                       
|                                       
|Research and development                |                                                                     |   | 2,504  |        |      |   | 2,261  |       
|                                       
|                                       
|                                       
|                                       
|Amortization of intangible assets       |                                                                     |   | 1,879  |        |      |   | 1,869  |       
|                                        |                                                                     |   |        |        |      |   |        |       
|                                        | Operating expenses                                                  |   |        | 10,448 |      |   |        | 12,926 | 
|                                        |                                                                     |   |        |        |      |   |        |       
|Income from operations                  |                                                                     |   | 3,218  |        |      |   | 5,224  |       
|                                       
|                                       
|                                       
|                                       
|Interest expense                        |                                                                     |   | 6,476  |        |      |   | 5,670  |       
|                                       
|                                       
|                                       
|                                       
|Other, net                              |                                                                     |   | (59    | )      |      |   | (222   | )     
|                                        |                                                                     |   |        |        |      |   |        |       
|Loss before income taxes                |                                                                     |   | (3,199 | )      |      |   | (224   | )     
|                                        |                                                                     |   |        |        |      |   |        |       
|Income tax (benefit) provision          |                                                                     |   | (1,120 | )      |      |   | 977    |       
|                                        |                                                                     |   |        |        |      |   |        |       
|Net loss                                |                                                                     | $ | (2,079 | )      |      | $ | (1,201 | )     
|                                        |                                                                     |   |        |        |      |   |        |       
|Other comprehensive income, net of tax:
|                                       
|                                       
|                                       
|                                       
|                                        | Foreign currency translation adjustment, net of
income tax of $(28) |   |        | 41     |      |   |        |       | 
|                                        |                                                                     |   |        |        |      |   |        |       
|Comprehensive Loss                      |                                                                     | $ | (2,038 | )      |      | $ | (1,201 | )     
|                                        |                                                                     |   |        |        |      |   |        |       

The accompanying notes to consolidated financial statements are an integral part of this statement.



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##### Table of Contents



ARGO-TECH CORPORATION AND SUBSIDIARIES
(A Wholly-Owned Subsidiary of AT Holdings Corporation)







CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE 13 WEEKS ENDED JANUARY 29, 2000 AND JANUARY 30, 1999

(In thousands)
UNAUDITED

|                                      |                                                                                                |                               |       |        |        |      |        |         |        |  
|------------------------------------- | ---------------------------------------------------------------------------------------------- | ----------------------------- | ----- | ------ | ------ | ---- | ------ | ------- | ------ | -
|                                      |                                                                                                |                               |       | 2000   |        | 1999
|                                      |                                                                                                |                               |       |        |        |     
|CASH FLOWS FROM OPERATING ACTIVITIES:
|                                     
|                                     
|                                     
|                                     
|                                      | Net loss                                                                                       |                               | $     | (2,079 | )      |      | $      | (1,201  | )     
|                                     
|                                     
|                                     
|                                     
|                                      | Adjustments to reconcile net loss to net cash
provided by operating activities:               
|                                     
|                                     
|                                     
|                                     
|                                      | Depreciation                                                                                   |                               |       | 1,540  |        |      |        | 1,685   |       
|                                     
|                                     
|                                     
|                                     
|                                      | Amortization of intangible assets and deferred financing costs                                 |                               |       | 2,401  |        |      |        | 2,241   |       
|                                     
|                                     
|                                     
|                                     
|                                      | Accretion of bond discount                                                                     |                               |       | 56     |        |      |        | 20      |       
|                                     
|                                     
|                                     
|                                     
|                                      | Compensation expense recognized in connection with
employee stock ownership plan               |                               |       | 1,009  |        |      |        | 1,895   |       
|                                     
|                                     
|                                     
|                                     
|                                      | Compensation expense recognized in connection with
stock appreciation rights and stock options |                               |       |       |        |      |        | 2,771   |       
|                                     
|                                     
|                                     
|                                     
|                                      | Amortization of inventory step-up                                                              |                               |       | 193    |        |      |        |        |       
|                                     
|                                     
|                                     
|                                     
|                                      | Deferred income taxes                                                                          |                               |       | (1,024 | )      |      |        | (256    | )     
|                                     
|                                     
|                                     
|                                     
|                                      | Changes in operating assets and liabilities:                                                  
|                                     
|                                     
|                                     
|                                     
|                                      |                                                                                                | Receivables                   |       |        | 7,104  |      |        |         | (91    | )
|                                     
|                                     
|                                     
|                                     
|                                      |                                                                                                | Inventories                   |       |        | (2,619 | )    |        |         | (2,841 | )
|                                     
|                                     
|                                     
|                                     
|                                      |                                                                                                | Prepaid expenses              |       |        | (762   | )    |        |         | (636   | )
|                                     
|                                     
|                                     
|                                     
|                                      |                                                                                                | Accounts payable              |       |        | (2,686 | )    |        |         | (2,004 | )
|                                     
|                                     
|                                     
|                                     
|                                      |                                                                                                | Accrued and other liabilities |       |        | 1,663  |      |        |         | 3,638  |  
|                                     
|                                     
|                                     
|                                     
|                                      |                                                                                                | Other, net                    |       |        | 26     |      |        |         |       |  
|                                      |                                                                                                |                               |       |        |        |      |        |        
|                                      | Net cash provided by operating activities                                                      |                               |       | 4,822  |        |      |        | 5,221   |       
|                                      |                                                                                                |                               |       |        |        |      |        |        
|CASH FLOWS FROM INVESTING ACTIVITIES:
|                                     
|                                     
|                                     
|                                     
|                                      | Capital expenditures                                                                           |                               |       | (508   | )      |      |        | (1,358  | )     
|                                      |                                                                                                |                               |       |        |        |      |        |        
|                                      | Net cash used in investing activities                                                          |                               |       | (508   | )      |      |        | (1,358  | )     
|                                      |                                                                                                |                               |       |        |        |      |        |        
|CASH FLOWS FROM FINANCING ACTIVITIES:
|                                     
|                                     
|                                     
|                                     
|                                      | Sale of senior subordinated notes                                                              |                               |       |       |        |      |        | 52,250  |       
|                                     
|                                     
|                                     
|                                     
|                                      | Repayment of long-term debt                                                                    |                               |       | (4,348 | )      |      |        | (1,195  | )     
|                                     
|                                     
|                                     
|                                     
|                                      | Repayment of note payable  Durodyne acquisition                                               |                               |       | (557   | )      |      |        |        |       
|                                     
|                                     
|                                     
|                                     
|                                      | Payment of financing related fees                                                              |                               |       |       |        |      |        | (9,741  | )     
|                                     
|                                     
|                                     
|                                     
|                                      | Dividend                                                                                       |                               |       | (65    | )      |      |        | (51,354 | )     
|                                      |                                                                                                |                               |       |        |        |      |        |        
|                                      | Net cash used in financing activities                                                          |                               |       | (4,970 | )      |      |        | (10,040 | )     
|                                      |                                                                                                |                               |       |        |        |      |        |        
|CASH AND CASH EQUIVALENTS:           
|                                     
|                                     
|                                     
|                                     
|Net decrease for the period           |                                                                                                |                               | (656  | )      |        |      | (6,177 | )      
|                                     
|                                     
|                                     
|                                     
|Balance, Beginning of period          |                                                                                                |                               | 3,873 |        |        |      | 11,578 |        
|                                      |                                                                                                |                               |       |        |        |      |        |        
|Balance, End of period                |                                                                                                | $                             | 3,217 |        |        | $    | 5,401  |        
|                                      |                                                                                                |                               |       |        |        |      |        |        

The accompanying notes to consolidated financial statements are an integral part of this statement.



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##### Table of Contents



ARGO-TECH CORPORATION AND SUBSIDIARIES
(A Wholly-Owned Subsidiary of AT Holdings Corporation)







NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE 13 WEEKS ENDED JANUARY 29, 2000 AND JANUARY 30, 1999
(Unaudited)

|1. |  | BASIS OF PRESENTATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|-- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|  
|  
|  
|   |  | The principal operations of Argo-Tech Corporation (a wholly-owned subsidiary
of AT Holdings Corporation) and its Subsidiaries include the design,
manufacture and distribution of aviation products, primarily aircraft fuel
pumps, throughout the world. In addition, Argo-Tech leases a portion of its
manufacturing facility to other parties. Argo-Techs fiscal year ends on the
last Saturday in October. Argo-Tech is obligated to fulfill certain
obligations of AT Holdings Corporation. As a result, those obligations have
been reflected in its financial statements. Certain reclassifications have
been made in the prior years financial statements to conform to the current
year presentation.                                                                                                                                                                                                                                                                                  
|  
|  
|  
|  
|  
|   |  | Argo-Tech Corporation is a parent, holding company with four wholly-owned
operating guarantor subsidiaries, Argo-Tech Corporation (HBP), Argo-Tech
Corporation (OEM), Argo-Tech Corporation (Aftermarket) and J.C. Carter
Company, Inc. Argo-Tech has no outside assets, liabilities or operations
apart from its wholly-owned subsidiaries. The Senior Subordinated Notes are
fully, unconditionally, jointly and severally guaranteed by the guarantor
subsidiaries, and therefore, separate financial statements of the guarantor
subsidiaries will not be presented. Management has determined that the
information presented by such separate financial statements of the guarantor
subsidiaries is not material to investors. All of Argo-Techs subsidiaries
are guarantors except two wholly-owned subsidiaries that have inconsequential
assets, liabilities and equity. Their only operations are the result of
intercompany activity which is immediately dividended back to Argo-Tech.
|  
|  
|  
|  
|  
|2. |  | UNAUDITED FINANCIAL INFORMATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|  
|  
|  
|  
|   |  | The financial information included herein is unaudited; however, the
information reflects all adjustments (consisting solely of normal recurring
adjustments) that are, in the opinion of management, necessary for a fair
presentation of Argo-Techs financial position and results of operations and
cash flows for the interim periods presented. The results of operations for
the 13 weeks ended January 29, 2000 are not necessarily indicative of the
results to be expected for the full year.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|  
|  
|  
|  
|  
|3. |  | INVENTORIES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|  
|  
|  
|  
|   |  | Inventories are stated at standard cost which approximates the costs which
would be determined using the first-in, first-out (FIFO) method. The
recorded value of inventories is not in excess of market value. Inventories
consist of the following (in thousands):                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              

|                                          |       |   |             |        |             |   |        |        | 
|----------------------------------------- | ----- | - | ----------- | ------ | ----------- | - | ------ | ------ | 
|                                          |       |   | January 29, |        | October 30,
|                                          |       |   | 2000        |        | 1999       
|                                          |       |   |             |        |            
|Finished goods                            |       | $ | 2,095       |        |             | $ | 2,151  |       
|                                         
|                                         
|                                         
|                                         
|Work-in-process and purchased parts       |       |   | 23,788      |        |             |   | 20,404 |       
|                                         
|                                         
|                                         
|                                         
|Raw materials and supplies                |       |   | 13,626      |        |             |   | 14,252 |       
|                                          |       |   |             |        |             |   |        |       
|                                          | Total |   |             | 39,509 |             |   |        | 36,807 | 
|                                         
|                                         
|                                         
|                                         
|Reserve for excess and obsolete inventory |       |   | (3,040      | )      |             |   | (2,764 | )     
|                                          |       |   |             |        |             |   |        |       
|Inventories  net                         |       | $ | 36,469      |        |             | $ | 34,043 |       
|                                          |       |   |             |        |             |   |        |       





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|4. |  | CONTINGENCIES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
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|   |  | Environmental Matters  The soil and groundwater at Argo-Techs Euclid, Ohio
facility and the Costa Mesa, California facility contain elevated levels of
certain contaminants which are currently in the process of being removed
and/or remediated. Because Argo-Tech has certain indemnification rights from
former owners of the facilities for liabilities arising from these or other
environmental matters, in the opinion of Argo-Techs management, the ultimate
outcome is not expected to materially affect its financial condition, results
of operations or liquidity.
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|   |  | Other Matters  Argo-Tech is subject to various legal actions and other
contingencies. In the opinion of Argo-Techs management, after reviewing
the information which is currently available with respect to such matters and
consulting with Argo-Techs legal counsel, any liability which may ultimately
be incurred with respect to these additional matters is not expected to
materially affect Argo-Techs financial condition, results of operations or
liquidity.                                                                                                       
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|5. |  | SEGMENT INFORMATION                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
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|   |  | The Company operates in two business segments: Argo-Tech and J.C. Carter.
Argo-Tech includes the design, manufacture and distribution of aviation
products, primarily aircraft fuel pumps, throughout the world. J.C. Carter
is a wholly-owned subsidiary of Argo-Tech Corporation which designs,
manufactures and distributes fuel flow related products found on a planes
airframe, aerial refueling systems, ground fueling system valves and related
components and industrial marine cryogenic pumps for transferring liquefied
natural gas.                                
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|   |  | The Company evaluates the performance of its segments based primarily on
operating profit before amortization of goodwill, deferred financing fees and
other identified intangibles, interest expense, interest income, other
miscellaneous fees and income taxes.                                                                                                                                                                                                                                                                                                                
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|   |  | The following table presents revenues and other financial information by
business segment (in thousands):                                                                                                                                                                                                                                                                                                                                                                                                                                                                         

13 Week Period Ending January 29, 2000

|                                                                                 |  |           |        |             |  |           |        |              |  |   |      |   |  |   |        |  
|-------------------------------------------------------------------------------- |  | --------- | ------ | ----------- |  | --------- | ------ | ------------ |  | - | ---- | - |  | - | ------ | -
|                                                                                 |  | Argo-Tech |        | J.C. Carter |  | Corporate |        | Consolidated
|                                                                                 |  |           |        |             |  |           |        |             
|Customer revenues                                                                |  | $         | 22,250 |             |  | $         | 13,580 |              |  | $ |     |   |  | $ | 35,830 |  
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Intersegment revenues                                                            |  |           | 3      |             |  |           |       |              |  |   |     |   |  |   | 3      |  
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Eliminations                                                                     |  |           |        |             |  |           |        |              |  |   |      |   |  |   | (3     | )
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Operating profit (loss)                                                          |  |           | 4,280  |             |  |           | 987    |              |  |   | (170 | ) |  |   | 5,097  |  
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Amortization of goodwill
and intangible assets                                   |  |           |        |             |  |           |        |              |  |   |      |   |  |   | 1,879  |  
|                                                                                 |  |           |        |             |  |           |        |              |  |   |      |   |  |   |        |  
|Income from operations                                                           |  |           |        |             |  |           |        |              |  |   |      |   |  |   | 3,218  |  
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Interest expense                                                                 |  |           |        |             |  |           |        |              |  |   |      |   |  |   | 6,476  |  
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Interest income and other                                                        |  |           |        |             |  |           |        |              |  |   |      |   |  |   | (59    | )
|                                                                                 |  |           |        |             |  |           |        |              |  |   |      |   |  |   |        |  
|Loss before tax                                                                  |  |           |        |             |  |           |        |              |  |   |      |   |  | $ | (3,199 | )
|                                                                                 |  |           |        |             |  |           |        |              |  |   |      |   |  |   |        |  
|Capital expenditures                                                             |  |           | 478    |             |  |           | 30     |              |  |   |      |   |  |   | 508    |  
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Depreciation                                                                     |  |           | 1,072  |             |  |           | 406    |              |  |   | 62   |   |  |   | 1,540  |  
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Amortization of inventory step-up                                                |  |           |        |             |  |           | 193    |              |  |   |      |   |  |   | 193    |  
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Compensation expense recognized
in connection with employee stock ownership plan |  |           | 1,009  |             |  |           |        |              |  |   |      |   |  |   | 1,009  |  





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13 Week Period Ending January 30, 1999

|                                                                                               |  |           |        |             |  |           |        |              |  |   |        |   |  |   |        |  
|---------------------------------------------------------------------------------------------- |  | --------- | ------ | ----------- |  | --------- | ------ | ------------ |  | - | ------ | - |  | - | ------ | -
|                                                                                               |  | Argo-Tech |        | J.C. Carter |  | Corporate |        | Consolidated
|                                                                                               |  |           |        |             |  |           |        |             
|Customer revenues                                                                              |  | $         | 28,427 |             |  | $         | 11,716 |              |  | $ |       |   |  | $ | 40,143 |  
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|Intersegment revenues                                                                          |  |           | 7      |             |  |           | 6      |              |  |   |       |   |  |   | 13     |  
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|Eliminations                                                                                   |  |           |        |             |  |           |        |              |  |   |        |   |  |   | (13    | )
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|Operating profit (loss)                                                                        |  |           | 8,211  |             |  |           | 1,523  |              |  |   | (2,641 | ) |  |   | 7,093  |  
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|Amortization of goodwill
and intangible assets                                                 |  |           |        |             |  |           |        |              |  |   |        |   |  |   | 1,869  |  
|                                                                                               |  |           |        |             |  |           |        |              |  |   |        |   |  |   |        |  
|Income from operations                                                                         |  |           |        |             |  |           |        |              |  |   |        |   |  |   | 5,224  |  
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|Interest expense                                                                               |  |           |        |             |  |           |        |              |  |   |        |   |  |   | 5,670  |  
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|Interest income and other                                                                      |  |           |        |             |  |           |        |              |  |   |        |   |  |   | (222   | )
|                                                                                               |  |           |        |             |  |           |        |              |  |   |        |   |  |   |        |  
|Loss before tax                                                                                |  |           |        |             |  |           |        |              |  |   |        |   |  | $ | (224   | )
|                                                                                               |  |           |        |             |  |           |        |              |  |   |        |   |  |   |        |  
|Capital expenditures                                                                           |  |           | 1,275  |             |  |           | 83     |              |  |   |        |   |  |   | 1,358  |  
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|Depreciation                                                                                   |  |           | 935    |             |  |           | 684    |              |  |   | 66     |   |  |   | 1,685  |  
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|Compensation expense recognized
in connection with employee stock ownership
plan               |  |           | 1,895  |             |  |           |        |              |  |   |        |   |  |   | 1,895  |  
|                                                                                              
|                                                                                              
|                                                                                              
|                                                                                              
|Compensation expense recognized
in connection with stock appreciation rights
and stock options |  |           |        |             |  |           |        |              |  |   | 2,771  |   |  |   | 2,771  |  







ITEM 2.

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

Argo-Tech Corporation is a leading designer, manufacturer and servicer of
high performance fuel flow devices for the aerospace industry providing a broad
range of products and services to substantially all commercial and domestic
military engine and airframe manufacturers, to airlines worldwide and to the
U.S. and certain foreign militaries. Argo-Tech is the worlds leading supplier
of main engine fuel pumps to the commercial aircraft industry and a leading
supplier of airframe products and aerial refueling systems. Argo-Tech is also
a leading manufacturer of components for ground fueling systems.

The following is managements discussion and analysis of certain
significant factors which have affected Argo-Techs financial position and
operating results during the periods presented in the accompanying condensed
consolidated financial statements. Argo-Techs fiscal year ends on the last
Saturday of October and is identified according to the calendar year in which
it ends.

Results of Operations for the 13 Week Period Ended January 29, 2000 Compared
With the 13 Week Period Ended January 30, 1999

Net revenues for the 13 week period ended January 29, 2000 decreased $4.3
million, or 10.7%, to $35.8 million from $40.1 million for the 13 week period
ended January 30,1999. This decrease was primarily due to a decrease in
aerospace revenues of $5.7 million offset by a $1.4 million increase in
industrial and other revenues. The decrease in aerospace revenues was
attributable to a decrease of $6.5 million of commercial aerospace revenues
offset by a $0.8 million increase in military revenues. Commercial OEM
revenues decreased $1.8 million, or 20.4%, to $7.0 million and commercial
aftermarket revenues decreased $4.7 million, or 24.2%, to $14.7 million in the
13 week period ended January 29, 2000. Commercial OEM revenues declined as a
result of lower aircraft build rates, while commercial aftermarket revenues
were lower primarily due to a decrease in the demand from an international
distributor. The distributor reduced its demand to adjust inventories that had
accumulated as a result of lower orders for JT8 and JT9 spare parts during the
last half of





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fiscal year 1999 and in response to lower demand by airlines for
spare pumps used for initial provisioning purposes. Military revenues
increased primarily due to an increase in sales of KC-135 aerial refueling
components offset by a decrease in F-15 foreign military sales. Industrial
revenues included an increase in ground fueling revenues of $1.7 million, or
53.1%, to $4.9 million offset by a decrease in cryogenic products of $0.3
million, or 27.3%, to $0.8 million. Heritage Business Park revenues of $1.2
million were unchanged from the prior comparable period.

Gross profit for the 13 week period ended January 29, 2000 decreased $4.5
million, or 24.7%, to $13.7 million from $18.2 million in the 13 week period
ended January 30, 1999. Gross margin decreased to 38.3% for the 13 week period
ended January 29, 2000 from 45.4% in the 13 week period ended January 30, 1999.
The decrease in gross profit and gross margin is primarily due to the decrease
in aerospace revenues which resulted in a lower margin sales mix of aerospace
products and lower operating performance at the Cleveland facility.

Operating expenses for the 13 week period ended January 29, 2000 decreased
$2.5 million, or 19.4%, to $10.4 million from $12.9 million in the 13 week
period ended January 30, 1999. This decrease is primarily attributable to the
non-recurrence of the $2.8 million non-cash compensation expense associated
with the vesting of stock options and stock appreciation rights in connection
with the repurchase of common stock from AT Holdings largest shareholder on
January 4, 1999 offset by a $0.2 million increase in research and development
expense. Operating expenses as a percent of revenues were 29.1% for the 13 week
period ended January 29, 2000 as compared to 32.2% for the 13 week period ended
January 30, 1999.

Income from operations for the 13 week period ended January 29, 2000
decreased $2.0 million, or 38.5%, to $3.2 million from $5.2 million in the 13
week period ended January 30, 1999. As a percent of revenues, income from
operations for the 13 week period ended January 29, 2000 decreased to 8.9% from
13.0% for the 13 week period ended January 30, 1999. These decreases were due
to lower aerospace revenues, unfavorable sales mix of aerospace products and
lower operating performance at the Cleveland facility offset by the decrease
in operating expenses due to the non-recurrence of the $2.8 million non-cash
compensation expense associated with the vesting of stock options and stock
appreciation rights in connection with the repurchase of common stock from AT
Holdings largest shareholder and an increase in research and development
expense.

Interest expense for the 13 week period ended January 29, 2000 increased
$0.9 million, or 16.1%, to $6.5 million from $5.6 million for the 13 week
period ended January 30, 1999 primarily due to the issuance of the $55.0
million Senior Subordinated Notes in connection with the repurchase of common
stock of AT Holdings from its largest shareholder on January 4, 1999 and higher
interest rates on term loans, partially offset by a lower level of term loans.

The income tax provision for the 13 week period ended January 29, 2000
decreased $2.1 million to a benefit of $1.1 million from an expense of $1.0
million in the 13 week period ended January 30, 1999. This decrease is due to
an increase of pre-tax loss to $3.2 million for the 13 week period ended
January 29, 2000 as compared to a pre-tax loss of $0.2 million and the effect
of the non-deductible compensation expense on the vesting of stock options and
stock appreciation rights for the 13 week period ended January 30, 1999.

Net loss for the 13 week period ended January 29, 2000 increased $0.9
million, or 75.0%, to $2.1 million from $1.2 million for the 13 week period
ended January 30, 1999 primarily due to the revenue and expense factors
discussed above.

Fluctuations of Operating Results; Limitation of Quarterly Comparisons

Argo-Techs results of operations are subject to fluctuations from quarter
to quarter due to changes in demand for its products, changes in product mix
and other factors. Demand for its products can vary from quarter to quarter
due to changes in demand for, and timing of deliveries of, OEM, aftermarket and
military





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products and services. In particular, the timing of Argo-Techs
aftermarket sales tends not to occur on a predictable schedule and,
furthermore, the sales tend to occur in large quantities which can
significantly impact quarterly comparisons. Accordingly, year-to-year and
quarter-to-quarter comparisons of quarterly results may not be meaningful, and
quarterly results during the year are not necessarily indicative of the results
that may be expected for any future period or for the entire year.

Liquidity and Capital Resources

Argo-Tech is a holding company that receives all of its operating income
from its subsidiaries. As a result, Argo-Techs primary source of liquidity
for conducting business activities and servicing its indebtedness has been cash
flows from operating activities.

Cash for the period ended January 29, 2000 decreased $0.7 million to $3.2
million, primarily due to the scheduled repayment of term loans, an increase in
inventory and a decrease in accounts payable offset by a favorable change in
accounts receivable and accrued and other liabilities.

Capital expenditures for the 13 weeks ended January 29, 2000 totaled $0.5
million compared to $1.4 million for the 13 weeks ended January 30, 1999.
Argo-Tech expects to incur capital expenditures of approximately $4.0 million
for the remainder of fiscal year 2000, related to the continued maintenance of
facilities, equipment and systems to support current operating activities.

Long-term debt at January 29, 2000 consisted of $79.1 million principal
amount of term loans and $192.5 million principal amount of Senior Subordinated
Notes. A scheduled payment of $2.3 million was made on the term loans and $2.0
million was paid on the revolving credit facility. Argo-Tech has available,
after $1.0 million of letters of credit, a $19.0 million revolving credit
facility. As of January 29, 2000, there were no outstanding borrowings on the
revolving credit facility. The credit facility contains no restrictions on the
ability of Argo-Techs subsidiaries to make distributions to Argo-Tech.

Year 2000

Argo-Tech did not experience any significant malfunctions or errors in its
operating of business systems when the date changed from 1999 to 2000. Based
on operations since January 1, 2000, Argo-Tech does not expect any significant
impact to its on-going business as a result of the Year 2000 issue. However,
it is possible that the full impact of the date change, which was of concern
due to computer programs that use two digits instead of four digits to define
years, has not been fully recognized. For example, it is possible that Year
2000 or similar issues such as leap year-related problems may occur with
billing, payroll, or financial closings at month, quarter or year-end periods.
Argo-Tech believes that any such problems are likely to be minor and
correctable. In addition, Argo-Tech could still be negatively impacted if its
customers or suppliers are adversely affected by the Year 2000 or similar
issues. Argo-Tech currently is not aware of any significant Year 2000 or
similar problems that have arisen for its customers and suppliers.

Argo-Tech expended $1.5 million on Year 2000 readiness efforts from 1997
to 1999. These efforts included replacing some outdated, noncompliant hardware
and noncompliant software as well as identifying and remediating Year 2000
problems.

Certain Factors That May Affect Future Results

From time to time, information provided by Argo-Tech, statements by its
employees or information included in its filings with the Securities and
Exchange Commission (including those portions of the Managements Discussion
and Analysis that refer to the future) may contain forward-looking statements
that are not historical facts. Those statements are forward-looking within
the meaning of the Private Securities





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Litigation Reform Act of 1995. Such
forward-looking statements, and the Companys future performance, operating
results, financial position and liquidity, are subject to a variety of factors
that could materially affect results. Some, but not necessarily all, of these
factors include: Argo-Techs dependence on the aerospace industry; government
regulation and oversight; defense spending; competition; product and
environmental liabilities; and risks associated with its workforce, suppliers,
and future acquisitions.







ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

In the ordinary course of operations, Argo-Techs major market risk
exposure is to changing interest rates. Argo-Techs exposure to changes in
interest rates relates primarily to its long term debt obligations. At January
29, 2000, Argo-Tech has fixed rate debt totaling $195 million, including $2.5
million of accretion, at 8.625% and variable rate debt under its existing
credit facility of $79.1 million calculated at Argo-Techs choice using an
alternate base rate (ABR) or LIBOR, plus a supplemental percentage determined
by the ratio of debt to EBITDA. The variable rate is not to exceed ABR plus
1.00% or LIBOR plus 2.00%. In order to reduce variable interest rate exposure
on borrowings under its existing credit facility, Argo-Tech has three interest
rate swap agreements on a portion of the variable rate debt which fix the rate
on the notional amounts of $10.0 million at 6.08%, 6.10% and 6.805%,
respectively. Argo-Tech does not enter into derivative contracts for trading
or speculative purposes. A 10% fluctuation in interest rates would not
materially affect Argo-Techs financial condition, results of operations or
cash flows.







PART II  OTHER INFORMATION







Item 6  Exhibits and Reports on Form 8-K



| |                                                     
| | ----------------------------------------------------
| | (a) Exhibits  Schedule 27  Financial Data Schedule
|
| | Reports on Form 8-K  None                          





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SIGNATURE



| |                                                                                                                                                                                          
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 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.

|      |  |           |  |      |  |  |  |                                                                                          
|----- |  | --------- |  | ---- |  |  |  | -----------------------------------------------------------------------------------------
|Date: |  | March 10, |  | 2000 |  |  |  | ARGO-TECH CORPORATION                                                                    
|     
|      |  |           |  |      |  |  |  | By: /s/  Frances S. St. Clair
__________________________                                 
|     
|      |  |           |  |      |  |  |  | Frances S. St. Clair
Vice President and Chief Financial Officer
(Duly Authorized Officer)
|     
|      |  |           |  |      |  |  |  | By: /s/  Paul A. Sklad
________________________                                          
|     
|      |  |           |  |      |  |  |  | Paul A. Sklad
Controller
(Principal Accounting Officer)