----

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| Pennsylvania                                  |   | 23-1683282               |
|-----------------------------------------------|--------|--------------------------|
| (State      or other jurisdiction of          |   | (I.R.S.      Employer    |
| incorporation      or organization)           |   | Identification      No.) |
|                                          |   |                     |
| 160 Cassell Road, P. O. Box      144          |   |                     |
| Harleysville,      Pennsylvania               |   | 19438                    |
| (Address      of principal executive offices) |   | (Zip      Code)          |

|                                          |   | Name of each exchange      on |
|-----------------------------------------------|--------|-------------------------------|
| Title of each      class                      |   | which      registered         |
| Common      Shares, par value $0.10 per share |   | New      York Stock Exchange  |

| Common      Shares, par value $0.10 per share |   |   |
|-----------------------------------------------|--------|--------|
| (Title      of Class)                         |   |   |

| Large accelerated filer o | Accelerated filer x | Non-accelerated filer o | Smaller reporting company o |
|--------------------------------|--------------------------|------------------------------|-----------------------------|

|                                                                                                                                                                                                           | Form      10-KPartNumber |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------|
| Portions      of Registrant’s Definitive Proxy Statement filed pursuant to Regulation      14A in connection with Registrant’s Annual Meeting of Shareholders to be      held on June 4, 2008 | III                      |

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nd

|          |          |   |                                                                                                                                  | Page   |
|---------------|---------------|--------|---------------------------------------------------------------------------------------------------------------------------------------|--------|
|          |          |   |                                                                                                                                  |   |
| PART      I   |          |   |                                                                                                                                  |
|          | Item      1.  |   | Business                                                                                                                              | 1      |
|          |          |   | Executive Officers of the Registrant                                                                                                  | 7      |
|          | Item      1A. |   | Risk Factors                                                                                                                          | 8      |
|          | Item      1B. |   | Unresolved Staff Comments                                                                                                             | 11     |
|          | Item      2.  |   | Properties                                                                                                                            | 12     |
|          | Item      3.  |   | Legal Proceedings                                                                                                                     | 13     |
|          | Item      4.  |   | Submission of Matters to a Vote of Security      Holders                                                                              | 13     |
|          |          |   |                                                                                                                                  |   |
| PART      II  |          |   |                                                                                                                                  |
|          | Item      5.  |   | Market      for the Registrant’s Common Equity, Related Shareholder Matters and      Issuer      Purchases of Equity Securities | 14     |
|          | Item      6.  |   | Selected Financial Data                                                                                                               | 17     |
|          | Item      7.  |   | Management’s Discussion and Analysis of Financial Condition      and Results of Operations                                      | 18     |
|          |          |   | Forward-Looking Statements; Factors That May Affect Future      Results                                                               | 26     |
|          | Item      7A. |   | Quantitative and Qualitative Disclosure About Market      Risks                                                                       | 27     |
|          | Item      8.  |   | Financial Statements and Supplementary    Data                                                                                        | 28     |
|          | Item      9.  |   | Changes in and Disagreements with Accountants on Accounting      and Financial Disclosure                                             | 59     |
|          | Item      9A. |   | Controls and Procedures                                                                                                               | 59     |
|          | Item      9B. |   | Other Information                                                                                                                     | 60     |
|          |          |   |                                                                                                                                  |   |
|          |          |   |                                                                                                                                  |   |
| PART      III |          |   |                                                                                                                                  |
|          | Item      10. |   | Directors, Executive Officers and Corporate      Governance                                                                           | 61     |
|          | Item      11. |   | Executive Compensation                                                                                                                | 61     |
|          | Item      12. |   | Security Ownership of Certain Beneficial Owners and      Management and Related Shareholder Matters                                   | 61     |
|          | Item      13. |   | Certain Relationships and Related Transactions, and Director      Independence                                                        | 61     |
|          | Item      14. |   | Principal Accountant Fees and Services                                                                                                | 62     |
|          |          |   |                                                                                                                                  |   |
| PART      IV  |          |   |                                                                                                                                  |
|          | Item      15. |   | Exhibits and Financial Statement    Schedules                                                                                         | 62     |
|          |          |   |                                                                                                                                  |   |
| SIGNATURES    |          |   | 66                                                                                                                                    |

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|               |   | Percentage of Net SalesFiscal Year Ended January 31, |   |
|--------------------|--------|-----------------------------------------------------------------------------------------|--------|
|               |   | 2008                                                                                    |   |   | 2007 |   |   | 2006 |   |
| United      States |   |                                                                                    | 71.7   | % |   |   | 75.9 | % |   |   | 75.7 | % |
| Foreign            |   |                                                                                    | 28.3   | % |   |   | 24.1 | % |   |   | 24.3 | % |
| Net      Sales     |   |                                                                                    | 100.0  | % |   |   | 100.0 | % |   |   | 100.0 | % |

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|   | · | export      and import restrictions, tax consequences and other trade      barriers, |
|--------|--------|--------------------------------------------------------------------------------------|

|   | · | currency      fluctuations, |
|--------|--------|-----------------------------|

|   | · | greater      difficulty in accounts receivablecollections, |
|--------|--------|------------------------------------------------------------|

|   | · | economic      and political instability, |
|--------|--------|------------------------------------------|

|   | · | foreign      exchange controls that prohibit payment in U.S. dollars,    and |
|--------|--------|------------------------------------------------------------------------------|

|   | · | increased      complexity and costs of managing and staffing international      operations. |
|--------|--------|---------------------------------------------------------------------------------------------|

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| Name |   | Structure |   | Property/Location |   | Status |
|------|--------|-----------|--------|-------------------|--------|--------|

| Executive      Offices,            | 73,000      square foot, cement      | 17      acres in Harleysville,          | Owned     |
|------------------------------------|--------------------------------------|-----------------------------------------|-----------|
| International      Sales Division, | building,      with finestone facing | Pennsylvania                            |      |
| Systems      Division and          |                                 |                                    |      |
| Strobic      Air Corporation       |                                 |                                    |      |
|                               |                                 |                                    |      |
| Keystone      Filter Division      | 31,000      square foot, cement      | 2.3      acres in Hatfield,             | Owned     |
|                               | block      building                  | Pennsylvania                            |      |
|                               |                                 |                                    |      |
| Sethco      and Fybroc Divisions   | 93,500      square foot, cement      | 8      acres in Telford,                | Owned(1)  |
|                               | building      with brick facing      | Pennsylvania                            |      |
|                               |                                 |                                    |      |
| Dean      Pump Division            | 66,000      square foot, metal       | 17.1      acres in                      | Owned     |
|                               | building                             | Indianapolis,      Indiana              |      |
|                               |                                 |                                    |      |
| Duall      and Mefiag Divisions    | 63,000      square foot, metal       | 7      acres in Owosso,                 | Owned     |
|                               | and      masonry building            | Michigan                                |      |
|                               |                                 |                                    |      |
| Flex-Kleen      Division           | 45,500      square foot, brick       | Glendale      Heights, Illinois         | Owned(2)  |
|                               | building                             |                                    |      |
|                               |                                 |                                    |      |
| Flex-Kleen      Canada Inc.        | 3,239      square foot, masonry      | Vaughan,      Ontario, Canada           | Leased(3) |
|                               | building                             |                                    |      |
|                               |                                 |                                    |      |
| Pristine      Water Solutions Inc. | 22,000      square foot, cement      | 2.55      acres in                      | Owned     |
|                               | block      building                  | Waukegan,      Illinois                 |      |
|                               |                                 |                                    |      |
| Mefiag      B.V.                   | 34,000      square foot, metal       | 1.1      acres in                       | Owned     |
|                               | and      masonry building            | Heerenveen,      The Netherlands        |      |
|                               |                                 |                                    |      |
|                               | Vacant      land                     | 3      acres in                         | Owned     |
|                               |                                 | Heerenveen,      The Netherlands        |      |
|                               |                                 |                                    |      |
| Mefiag      (Guangzhou) Filter     | 11,000      square foot cement       | Guangzhou,      People’s Republic | Leased(4) |
|   Systems      Ltd.      | building                             | of      China                           |      |

| (1) | We      completed a 47,000 square foot addition to this facility in the fiscal      year ended January 31, 2007; the reference to 93,500 square feet includes      this addition. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | We      purchased a 45,500 square foot building for Flex-Kleen Division’s      operation in Glendale Heights, Illinois and moved our warehouse from      Sharpsburg, North Carolina to this facility in the fiscal year ended      January 31, 2008. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | On      April 1, 2008, Flex-Kleen Canada Inc. entered into a lease for a sales and      warehouse facility in Vaughan, Ontario, Canada which expires on March 31,      2011. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (4) | Mefiag      (Guangzhou) Filter Systems Ltd.’s lease for the operation in Guangzhou,      People’s Republic of China expires on July 31,  2010. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                               |   |   |   |   | Quarter      ended |   |   |    |   |
|------------------------------------|--------|--------|--------|--------|--------------------|--------|--------|---------|--------|
| Year      ended January 31, 2008   |   | April  |   |   | July               |   |   | October |   |   | January |   |
|                               |   |   |   |   |               |   |   |    |   |   |   |   |
| Price      range of common shares: |   |   |   |   |               |   |   |    |   |   |   |   |
| High                               |   |   | $12.01 |   |               |   | $12.21 |    |   |   | $13.52 |   |   |   | $12.82 |   |
| Low                                |   |   | 10.69  |   |               |   | 11.18  |    |   |   | 10.40 |   |   |   | 10.20 |   |
| Cash      dividend paid            |   |   | .0506  |   |               |   | .0506  |    |   |   | .0506 |   |   |   | .0550 |   |
|                               |   |   |   |   |               |   |   |    |   |   |   |   |   |   |   |   |
| Year      ended January 31, 2007   |   | April  |   |   | July               |   |   | October |   |   | January |   |
|                               |   |   |   |   |               |   |   |    |   |   |   |   |   |   |   |   |
| Price      range of common shares: |   |   |   |   |               |   |   |    |   |   |   |   |   |   |   |   |
| High                               |   |   | $11.54 |   |               |   | $12.19 |    |   |   | $10.28 |   |   |   | $11.54 |   |
| Low                                |   |   | 9.50   |   |               |   | 9.08   |    |   |   | 9.22 |   |   |   | 9.92 |   |
| Cash      dividend paid            |   |   | .0469  |   |               |   | .0469  |    |   |   | .0469 |   |   |   | .0506 |   |

----

Index

|                                          |   | 2003   |    |   | 2004   |   |    | 2005   |   |   | 2006    |   |   | 2007   |    |   | 2008   |   |
|-----------------------------------------------|--------|--------|---------|--------|--------|--------|---------|--------|--------|--------|---------|--------|--------|--------|---------|--------|--------|--------|
|                                          |   |   |    |   |   |   |    |   |   |   |    |   |   |   |    |   |   |   |
|  Met-Pro      Corporation                |   |   | $100.00 |   |   |   | $170.01 |   |   |   | $132.35 |   |   |   | $182.47 |   |   |   | $219.21 |   |   |   | $200.04 |   |
|  Former      Peer Group Index            |   |   | 100.00  |   |   |   | 149.91  |   |   |   | 197.92  |   |   |   | 280.21  |   |   |   | 362.27 |   |   |   | 467.27 |   |
|  S&P      Industrial Machinery Index |   |   | 100.00  |   |   |   | 154.67  |   |   |   | 190.81  |   |   |   | 228.92  |   |   |   | 265.36 |   |   |   | 259.37 |   |
|  S&P      500 Index                  |   |   | 100.00  |   |   |   | 134.54  |   |   |   | 142.90  |   |   |   | 157.71  |   |   |   | 180.39 |   |   |   | 176.06 |   |
|  Russell      2000 Index                 |   |   | 100.00  |   |   |   | 156.05  |   |   |   | 167.67  |   |   |   | 197.01  |   |   |   | 215.05 |   |   |   | 191.66 |   |

|  | (1) | The      2008 Former Peer Group is made up of the following companies selected on      an industry basis: Flanders Corporation; Flowserve Corporation;      Gorman-Rupp Company; Idex Corporation; Met-Pro Corporation; Peerless      Manufacturing; Robbins & Myers Inc.; and Roper Industries      Inc.  The Peer Group for earlier years is not identical to the      2007 or 2008 Peer Groups. |
|--|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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Index

|                    |                      |                      | Number of Securities          |
|--------------------|---------------------------|---------------------------|-------------------------------|
|               |                      |                      | Remaining      Available      |
|               | Number of      Securities |                      | For Future      Issuance      |
|               | to be Issued      Upon    | Weighted-Average          | Under    Equity               |
|               | Exercise    of            | Exercise Price      of    | Compensation      Plans       |
|               | Outstanding      Options, | Outstanding      Options, | (Excluding      Securities    |
| Plan      Category | Warrants and      Rights  | Warrants and      Rights  | Reflected in Column      (A)) |
|               | (A)                       | (B)                       | (C)                           |

| Equity      compensation plans approved by  |      |   |   |   |    |   |
|---------------------------------------------|-----------|--------|--------|--------|---------|--------|
| security      holders                       | 1,338,281 |   | $8.60  |   | 476,438 |   |
| Equity      compensation plans not approved |      |   |   |   |    |   |
| by      security holders                    | -         |   | -      |   | -       |   |

| Period                    |   | TotalNumber      ofSharesPurchased |   |   | AveragePrice      PaidPer      Share |   |                                          | TotalNumber      ofSharesPurchasedAs      Part ofPubliclyAnnouncedPlans      orPrograms |   |   | MaximumNumber      ofSharesThat      MayYet      BePurchasedUnder      thePlan      orPrograms |          (1) |
|---------------------------|--------|------------------------------------|--------|--------|--------------------------------------|--------|-----------------------------------------------|-----------------------------------------------------------------------------------------|--------|--------|------------------------------------------------------------------------------------------------|-----------------------------------------------------------|
| February      1-28, 2007  |   |                               | 0      |   |                                 |   | $             - |                                                                                    |   |   | 0                                                                                              |                                                      |   |   | 361,224 |   |
| March      1-31, 2007     |   |                               | 0      |   |                                 |   | -                                             |                                                                                    |   |   | 0                                                                                              |                                                      |   |   | 361,224 |   |
| April      1-30, 2007     |   |                               | 0      |   |                                 |   | -                                             |                                                                                    |   |   | 0                                                                                              |                                                      |   |   | 361,224 |   |
| May      1-31, 2007       |   |                               | 0      |   |                                 |   | -                                             |                                                                                    |   |   | 0                                                                                              |                                                      |   |   | 361,224 |   |
| June      1-30, 2007      |   |                               | 0      |   |                                 |   | -                                             |                                                                                    |   |   | 0                                                                                              |                                                      |   |   | 361,224 |   |
| July      1-31, 2007      |   |                               | 0      |   |                                 |   | -                                             |                                                                                    |   |   | 0                                                                                              |                                                      |   |   | 361,224 |   |
| August      1-31, 2007    |   |                               | 0      |   |                                 |   | -                                             |                                                                                    |   |   | 0                                                                                              |                                                      |   |   | 361,224 |   |
| September      1-30, 2007 |   |                               | 0      |   |                                 |   | -                                             |                                                                                    |   |   | 0                                                                                              |                                                      |   |   | 361,224 |   |
| October      1-31, 2007   |   |                               | 51,205 |   |                                 |   | 12.32                                         |                                                                                    |   |   | 51,205                                                                                         |                                                      |   |   | 310,019 |   |
| November      1-30, 2007  |   |                               | 0      |   |                                 |   | -                                             |                                                                                    |   |   | 0                                                                                              |                                                      |   |   | 310,019 |   |
| December      1-31, 2007  |   |                               | 0      |   |                                 |   | -                                             |                                                                                    |   |   | 0                                                                                              |                                                      |   |   | 310,019 |   |
| January      1-31, 2008   |   |                               | 0      |   |                                 |   | -                                             |                                                                                    |   |   | 0                                                                                              |                                                      |   |   | 310,019 |   |
| Total                     |   |                               | 51,205 |   |                                 |   | $12.32                                        |                                                                                    |   |   | 51,205                                                                                         |                                                      |   |   | 310,019 |   |

|   | (1) | On      December 15, 2000, our Board of Directors authorized a Common Share      repurchase program that was publicly announced on December 19, 2000, for      up to 711,111 (adjusted for stock splits) shares.  The program      has no fixed expiration date. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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Index

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|                                                 |   |   |         |   | Years ended January 31, |   |        |   |   |
|------------------------------------------------------|--------|--------|--------------|--------|----------------------------------------|--------|-------------|--------|--------|
|                                                 |   | 2008   |         |   | 2007                                   |   |        | 2006   |   |   | 2005 |   |   | 2004 |   |
|                                                 |   |   |         |   |                                   |   |        |   |   |   |   |   |   |   |   |
| Selected      Operating Statement Data               |   |   |         |   |                                   |   |        |   |   |   |   |   |   |   |   |
| Net      sales (a)                                   |   |   | $106,867,849 |   |                                   |   | $93,505,504 |   |   |   | $87,687,053 |   |   |   | $74,431,932 |   |   |   | $78,213,995 |   |
| Income      from operations                          |   |   | 17,597,491   |   |                                   |   | 9,757,075   |   |   |   | 9,662,604 |   |   |   | 7,384,115 |   |   |   | 9,850,090 |   |
| Net      income                                      |   |   | 11,906,165   |   |                                   |   | 6,926,804   |   |   |   | 7,313,284 |   |   |   | 4,814,679 |   |   |   | 6,346,579 |   |
| Earnings      per share, basic (b)                   |   |   | .79          |   |                                   |   | .46         |   |   |   | .49 |   |   |   | .32 |   |   |   | .43 |   |
| Earnings      per share, diluted (b)                 |   |   | .78          |   |                                   |   | .46         |   |   |   | .48 |   |   |   | .32 |   |   |   | .43 |   |
|                                                 |   |   |         |   |                                   |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Selected      Balance Sheet Data                     |   |   |         |   |                                   |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Current      assets                                  |   |   | $68,095,140  |   |                                   |   | $58,803,353 |   |   |   | $53,413,413 |   |   |   | $50,034,033 |   |   |   | $47,569,003 |   |
| Current      liabilities                             |   |   | 16,850,801   |   |                                   |   | 14,364,393  |   |   |   | 14,361,953 |   |   |   | 12,916,500 |   |   |   | 11,429,817 |   |
| Working      capital                                 |   |   | 51,244,339   |   |                                   |   | 44,438,960  |   |   |   | 39,051,460 |   |   |   | 37,117,533 |   |   |   | 36,139,186 |   |
| Current      ratio                                   |   |   | 4.0          |   |                                   |   | 4.1         |   |   |   | 3.7 |   |   |   | 3.9 |   |   |   | 4.2 |   |
| Total      assets                                    |   |   | 109,410,903  |   |                                   |   | 96,741,657  |   |   |   | 89,071,391 |   |   |   | 82,687,604 |   |   |   | 80,531,131 |   |
| Long-term      obligations                           |   |   | 4,075,682    |   |                                   |   | 5,417,990   |   |   |   | 2,723,586 |   |   |   | 4,039,068 |   |   |   | 5,447,869 |   |
| Total      shareholders’ equity                |   |   | 83,243,168   |   |                                   |   | 72,313,132  |   |   |   | 67,538,238 |   |   |   | 63,165,191 |   |   |   | 60,270,734 |   |
| Total      capitalization                            |   |   | 87,318,850   |   |                                   |   | 77,731,122  |   |   |   | 70,261,824 |   |   |   | 67,204,259 |   |   |   | 65,718,603 |   |
| Return      on average total assets, %               |   |   | 11.6         |   |                                   |   | 7.5         |   |   |   | 8.5 |   |   |   | 5.9 |   |   |   | 8.2 |   |
| Return      on average shareholders’ equity, % |   |   | 15.3         |   |                                   |   | 9.9         |   |   |   | 11.2 |   |   |   | 7.8 |   |   |   | 10.9 |   |
|                                                 |   |   |         |   |                                   |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other      Financial Data                            |   |   |         |   |                                   |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net      cash flows from operating activities        |   |   | $9,875,144   |   |                                   |   | $3,900,152  |   |   |   | $4,441,414 |   |   |   | $8,545,521 |   |   |   | $8,232,851 |   |
| Capital      expenditures                            |   |   | 5,456,418    |   |                                   |   | 4,398,910   |   |   |   | 4,151,253 |   |   |   | 1,193,767 |   |   |   | 952,812 |   |
| Shareholders’      equity per share (b)        |   |   | 5.56         |   |                                   |   | 4.84        |   |   |   | 4.53 |   |   |   | 4.25 |   |   |   | 4.09 |   |
| Cash      dividends paid per share (b)               |   |   | .207         |   |                                   |   | .191        |   |   |   | .178 |   |   |   | .166 |   |   |   | .155 |   |
| Average      common shares, basic (b)                |   |   | 15,002,012   |   |                                   |   | 14,943,174  |   |   |   | 14,918,209 |   |   |   | 14,861,124 |   |   |   | 14,751,409 |   |
| Average      common shares, diluted (b)              |   |   | 15,328,368   |   |                                   |   | 15,205,012  |   |   |   | 15,111,483 |   |   |   | 15,045,342 |   |   |   | 14,930,233 |   |
| Common      shares outstanding (b)                   |   |   | 15,039,030   |   |                                   |   | 14,953,658  |   |   |   | 14,929,480 |   |   |   | 14,876,518 |   |   |   | 14,796,937 |   |

| (a) | The      Company reclassified the freight out, and representative and distributor      commissions from a deduction in gross sales to the cost of goods sold and      selling expense categories, respectively, for the fiscal years ended      January 31, 2008, 2007, 2006, 2005 and 2004.  For the fiscal      years ended January 31, 2008, 2007, 2006, 2005 and 2004, the freight out      was $1,216,522, $982,729, $722,438, $489,532 and $449,844, respectively,      and the representative and distributor commissions were $2,762,909,      $1,930,291, $1,848,515, $1,826,111 and $2,705,222,      respectively. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | All      references to per share amounts, average common shares and shares      outstanding have been restated to reflect the effect of the four-for-three      stock split effective November 14,2007. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

Index

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|   |   | Years      ended January 31, |
|--------|--------|------------------------------|

|                                             |   | 2008   |   |   | 2007   |   |   | 2006   |   |
|--------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
|                                             |   |   |   |   |   |   |   |   |   |
| Net      sales                                   |   |   | 100.0  | %      |   |   | 100.0  | %      |   |   | 100.0 | % |
| Cost      of goods sold                          |   |   | 66.0   | %      |   |   | 67.9   | %      |   |   | 67.5 | % |
| Gross      profit                                |   |   | 34.0   | %      |   |   | 32.1   | %      |   |   | 32.5 | % |
|                                             |   |   |   |   |   |   |   |   |   |   |   |   |
| Selling,      general and administrative expense |   |   | 20.8   | %      |   |   | 21.7   | %      |   |   | 21.5 | % |
| Gain      on sale of building                    |   |   | (3.3   | %)     |   |   | -      |   |   |   | - |   |
|                                             |   |   |   |   |   |   |   |   |   |   |   |   |
| Income      from operations                      |   |   | 16.5   | %      |   |   | 10.4   | %      |   |   | 11.0 | % |
|                                             |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest      expense                            |   |   | (.3    | %)     |   |   | (.4    | %)     |   |   | (.3 | %) |
| Other      income, net                           |   |   | .9     | %      |   |   | 1.0    | %      |   |   | .7 | % |
|                                             |   |   |   |   |   |   |   |   |   |   |   |   |
| Income      before taxes                         |   |   | 17.1   | %      |   |   | 11.0   | %      |   |   | 11.4 | % |
|                                             |   |   |   |   |   |   |   |   |   |   |   |   |
| Provision      for taxes                         |   |   | 6.0    | %      |   |   | 3.6    | %      |   |   | 3.1 | % |
|                                             |   |   |   |   |   |   |   |   |   |   |   |   |
| Net      income                                  |   |   | 11.1   | %      |   |   | 7.4    | %      |   |   | 8.3 | % |
|                                             |   |   |   |   |   |   |   |   |   |   |   |   |

----

Index

----

Index

----

Index

----

Index

----

Index

| Payments Due ByPeriod |   | Long-TermDebt |       |   | PurchaseObligations |   |       | OperatingLeases |   |   | InterestExpense |   |   | PensionContributions |       |   | Total ContractualCashObligations |   |
|---------------------------------|--------|---------------|------------|--------|---------------------|--------|------------|-----------------|--------|--------|-----------------|--------|--------|----------------------|------------|--------|---------------------------------------|--------|
| Less      than 1 Year           |   |          | $2,028,480 |   |                |   | $5,821,592 |            |   |   | $52,544         |   |   |                 | $231,093   |   |                                  |   | $599,377 |   |   |   | $8,733,086 |   |
| 1      – 3 Years          |   |          | 765,000    |   |                |   | -          |            |   |   | 60,865          |   |   |                 | 316,469    |   |                                  |   | 196,723 |   |   |   | 1,339,057 |   |
| 3      – 5 Years          |   |          | 765,000    |   |                |   | -          |            |   |   | -               |   |   |                 | 248,856    |   |                                  |   | 178,446 |   |   |   | 1,192,302 |   |
| More      than 5 Years          |   |          | 2,375,184  |   |                |   | -          |            |   |   | -               |   |   |                 | 393,831    |   |                                  |   | 375,159 |   |   |   | 3,144,174 |   |
| Total                           |   |          | $5,933,664 |   |                |   | $5,821,592 |            |   |   | $113,409        |   |   |                 | $1,190,249 |   |                                  |   | $1,349,705 |   |   |   | $14,408,619 |   |

----

Index

----

Index

----

Index

or

|   | · | the      write-down of costs in excess of net assets of businesses acquired      (goodwill), as a result of the determination that the acquired business is      impaired.  Our Flex-Kleen business unit, which initially      performed well after being acquired by Met-Pro, thereafter had several      years of declining performance which we attributed primarily to a general      weakness in its served markets, followed by improved performance in the      fiscal years ended January 31, 2008, 2007, and 2006.  During the      fiscal year ended January 31, 2008, we performed an impairment analysis of      the $11.1 million of goodwill that the Company carries for Flex-Kleen and      concluded that no impairment had occurred. For the fiscal year ended      January 31, 2008, the actual net sales and operating profit for our      Flex-Kleen business unit have exceeded the projections used in our annual      impairment model.  However, Flex-Kleen’s backlog as of January      31, 2008 totaled $3.3 million, which was a decrease of 22% from the      backlog amount at the same point in the prior fiscal      year.  Notwithstanding this decrease in backlog as of January      31, 2008, we anticipate that Flex-Kleen’s performance during the fiscal      year beginning February 1, 2008 will be at a level that will not indicate      impairment of its goodwill, but this expectation is a forward-looking      statement where the actual results may not be as we presently      anticipate; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | materially      adverse changes in economic conditions in the markets served by us or in      significant customers of ours; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------|

|   | · | material      changes in available technology; |
|--------|--------|------------------------------------------------|

|   | · | adverse      developments in the asbestos cases that have been filed against the      Company, including without limitation the exhaustion of insurance      coverage, the imposition of punitive damages or other adverse developments      in the availability of insurancecoverage; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | changes      in accounting rules promulgated by regulatory agencies, including the SEC,      which could result in an impact onearnings; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the      cost of compliance with Sarbanes-Oxley and other applicable legal and      listing requirements, and the unanticipated possibility that Met-Pro may      not meet these requirements; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | weaknesses      in our internal control over financial reporting, which either alone or      combined with actions by our employees intended to circumvent our internal      control over financial reporting, to violate our policies, or to commit      fraud or other bad acts, could lead to incorrect reporting of financial      results.  During the current fiscal year, we restated our      financial statements for the fiscal quarters ended October 31, 2006      through October 31, 2007 as well as for the fiscal year ended January 31,      2007 as a result of revenue recognition errors and other financial      statement errors that we made due to material weaknesses in internal      control over financial reporting that was exploited by an employee who      sought to circumvent our internal controls and other policies and      procedures.  Although we have instituted new controls and      procedures intended to improve our control over revenue recognition and      believe that our internal control over financial reporting as of January      31, 2008 is effective, there are limits to any control system and we      cannot give absolute assurance that our internal control is effective or      that financial statement misstatements will not occur or that policy      violations and/or fraud within the Company will not  occur; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | unexpected      results in our product developmentactivities; |
|--------|--------|---------------------------------------------------------------|

|   | · | loss      of key customers; |
|--------|--------|-----------------------------|

|   | · | changes      in product mix and the cost of materials, with effect on      margins; |
|--------|--------|-------------------------------------------------------------------------------------|

|   | · | changes      in our existing management; |
|--------|--------|------------------------------------------|

|   | · | exchange      rate fluctuations; |
|--------|--------|----------------------------------|

|   | · | changes      in federal laws, state laws andregulations; |
|--------|--------|----------------------------------------------------------|

|   | · | lower      than anticipated return on investments in the Company’s defined benefit      plans, which could affect the amount of the Company’s pension      liabilities; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

Index

|   | · | the      assertion of litigation claims that the Company’s products, including      products produced by companies acquired by the Company, infringe third      party patents or have caused injury, loss or  damage; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the      effect of acquisitions and other strategic  ventures; |
|--------|--------|----------------------------------------------------------------|

|   | · | failure      to properly quote and/or execute customer orders, including      misspecifications, design, engineering or production    errors; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the      cancellation or delay of purchase orders or  shipments; |
|--------|--------|------------------------------------------------------------------|

|   | · | losses      related to international sales; and |
|--------|--------|-------------------------------------------------|

|   | · | failure      in execution of acquisitionstrategy. |
|--------|--------|---------------------------------------------------|

te

----

Index

te

|                                                                        | Page   |
|-----------------------------------------------------------------------------|--------|
| Consolidated      Financial Statements:                                     |   |
| Management’s Report on Internal Control Over Financial      Reporting | 29     |
| Reports of Independent Registered Public Accounting      Firm               | 30     |
| Consolidated Statement of Operations                                        | 32     |
| Consolidated Balance Sheet                                                  | 33     |
| Consolidated Statement of Cash    Flows                                     | 34     |
| Consolidated Statement of Shareholders’      Equity                   | 35     |
| Consolidated Business Segment    Data                                       | 36     |
| Notes to Consolidated Financial      Statements                             | 37     |
| Supplementary      Data:                                                    |   |
| Quarterly Financial Data                                                    | 59     |

----

Index

MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIALREPORTING

|   |                                       |
|--------|--------------------------------------------|
|   | /s/      Raymond J. De Hont                |
|   | Raymond      J. De Hont                    |
|   | President      and Chief Executive Officer |

|   | /s/      Gary J. Morgan      |
|--------|------------------------------|
|   | Gary      J. Morgan          |
|   | Chief      Financial Officer |

----

Index

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTINGFIRM

|   | /s/      Margolis & Company P.C. |
|--------|--------------------------------------|

----

Index

|   | /s/      Margolis & Company P.C. |
|--------|--------------------------------------|

----

Index

CONSOLIDATED STATEMENT OF OPERATIONS

|                                          |   | Years ended January 31, |         |
|-----------------------------------------------|--------|----------------------------------------|--------------|
|                                          |   | 2008                                   |         |   | 2007 |   |   | 2006 |   |
| Net sales      (a)                            |   |                                   | $106,867,849 |   |   |   | $93,505,504 |   |   |   | $87,687,053 |   |
| Cost      of goods sold (a)                   |   |                                   | 70,495,481   |   |   |   | 63,459,996 |   |   |   | 59,163,879 |   |
| Gross      profit                             |   |                                   | 36,372,368   |   |   |   | 30,045,508 |   |   |   | 28,523,174 |   |
|                                          |   |                                   |         |   |   |   |   |   |   |   |   |   |
| Operating      expenses                       |   |                                   |         |   |   |   |   |   |   |   |   |   |
| Selling      (a)                              |   |                                   | 11,484,530   |   |   |   | 10,188,670 |   |   |   | 9,713,348 |   |
| General      and administrative               |   |                                   | 10,804,287   |   |   |   | 10,099,763 |   |   |   | 9,147,222 |   |
| Gain      on sale of building                 |   |                                   | (3,513,940   | ) |   |   | - |   |   |   | - |   |
|                                          |   |                                   | 18,774,877   |   |   |   | 20,288,433 |   |   |   | 18,860,570 |   |
| Income      from operations                   |   |                                   | 17,597,491   |   |   |   | 9,757,075 |   |   |   | 9,662,604 |   |
|                                          |   |                                   |         |   |   |   |   |   |   |   |   |   |
| Interest      expense                         |   |                                   | (304,325     | ) |   |   | (351,152 | ) |   |   | (269,488 | ) |
| Other      income, net                        |   |                                   | 968,715      |   |   |   | 932,590 |   |   |   | 629,035 |   |
| Income      before taxes                      |   |                                   | 18,261,881   |   |   |   | 10,338,513 |   |   |   | 10,022,151 |   |
|                                          |   |                                   |         |   |   |   |   |   |   |   |   |   |
| Provision      for taxes                      |   |                                   | 6,355,716    |   |   |   | 3,411,709 |   |   |   | 2,708,867 |   |
| Net      income                               |   |                                   | $11,906,165  |   |   |   | $6,926,804 |   |   |   | $7,313,284 |   |
|                                          |   |                                   |         |   |   |   |   |   |   |   |   |   |
| Earnings      per share                       |   |                                   |         |   |   |   |   |   |   |   |   |   |
| Basic      (adjusted for stock split)         |   |                                   | $.79         |   |   |   | $.46 |   |   |   | $.49 |   |
| Diluted      (adjusted for stock split)       |   |                                   | $.78         |   |   |   | $.46 |   |   |   | $.48 |   |
|                                          |   |                                   |         |   |   |   |   |   |   |   |   |   |
| Average      number of common and   |   |                                   |         |   |   |   |   |   |   |   |   |   |
| common equivalent shares      outstanding     |   |                                   |         |   |   |   |   |   |   |   |   |   |
| Basic      (adjusted for stock split)         |   |                                   | 15,002,012   |   |   |   | 14,943,174 |   |   |   | 14,918,209 |   |
| Diluted      (adjusted for stock split)       |   |                                   | 15,328,368   |   |   |   | 15,205,012 |   |   |   | 15,111,483 |   |

| (a) | The company reclassified the freight out, and      representative and distributor commissions from a deduction in gross sales      to the cost of goods sold and selling expense categories, respectively,      for the fiscal years ended January 31, 2008, 2007 and 2006.  For      the fiscal years ended January 31, 2008, 2007 and 2006, freight out was      $1,216,522, $982,729 and $722,438, respectively, and the representative      and distributor commissions were $2,762,909, $1,930,291 and $1,848,515,      respectively.  |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

Index

CONSOLIDATED BALANCE SHEET

|                                                                                                                                                                  |   | January 31, |         |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------|--------------|
| ASSETS                                                                                                                                                                |   | 2008             |         |   | 2007 |   |
| Current      assets                                                                                                                                                   |   |             |         |   |   |   |
| Cash      and cash equivalents                                                                                                                                        |   |             | $21,906,877  |   |   |   | $17,322,194 |   |
| Marketable      securities                                                                                                                                            |   |             | 20,369       |   |   |   | 24,090 |   |
| Accounts      receivable, net of allowance for          doubtful accounts of approximately          $152,000 and $133,000, respectively |   |             | 23,013,988   |   |   |   | 19,988,097 |   |
| Inventories                                                                                                                                                           |   |             | 21,258,227   |   |   |   | 19,720,842 |   |
| Prepaid      expenses, deposits and other current assets                                                                                                              |   |             | 1,895,679    |   |   |   | 1,748,130 |   |
| Total      current assets                                                                                                                                             |   |             | 68,095,140   |   |   |   | 58,803,353 |   |
|                                                                                                                                                                  |   |             |         |   |   |   |   |   |
| Property,      plant and equipment, net                                                                                                                               |   |             | 20,233,827   |   |   |   | 16,832,988 |   |
| Costs      in excess of net assets of businesses acquired, net                                                                                                        |   |             | 20,798,913   |   |   |   | 20,798,913 |   |
| Other      assets                                                                                                                                                     |   |             | 283,023      |   |   |   | 306,403 |   |
| Total      assets                                                                                                                                                     |   |             | $109,410,903 |   |   |   | $96,741,657 |   |

| LIABILITIES      AND SHAREHOLDERS’ EQUITY                                                                                                                                                                                                                                       |   |   |         |   |   |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------------|--------|--------|--------|
| Current      liabilities                                                                                                                                                                                                                                                              |   |   |         |   |   |   |
| Current      portion of long-term debt                                                                                                                                                                                                                                                |   |   | $2,028,482   |   |   |   | $1,955,202 |   |
| Accounts      payable                                                                                                                                                                                                                                                                 |   |   | 7,512,874    |   |   |   | 6,419,951 |   |
| Accrued      salaries, wages and expenses                                                                                                                                                                                                                                             |   |   | 6,023,857    |   |   |   | 4,005,300 |   |
| Dividend      payable                                                                                                                                                                                                                                                                 |   |   | 827,147      |   |   |   | 757,029 |   |
| Customers’      advances                                                                                                                                                                                                                                                        |   |   | 260,698      |   |   |   | 981,680 |   |
| Deferred      income taxes                                                                                                                                                                                                                                                            |   |   | 197,743      |   |   |   | 245,231 |   |
| Total      current liabilities                                                                                                                                                                                                                                                        |   |   | 16,850,801   |   |   |   | 14,364,393 |   |
|                                                                                                                                                                                                                                                                                  |   |   |         |   |   |   |   |   |
| Long-term      debt                                                                                                                                                                                                                                                                   |   |   | 4,075,682    |   |   |   | 5,417,990 |   |
| Other      non-current liabilities                                                                                                                                                                                                                                                    |   |   | 2,109,250    |   |   |   | 3,276,551 |   |
| Deferred      income taxes                                                                                                                                                                                                                                                            |   |   | 3,132,002    |   |   |   | 1,369,591 |   |
| Total      liabilities                                                                                                                                                                                                                                                                |   |   | 26,167,735   |   |   |   | 24,428,525 |   |
| Commitments                                                                                                                                                                                                                                                                           |   |   |         |   |   |   |   |   |
| Shareholders’      equity                                                                                                                                                                                                                                                       |   |   |         |   |   |   |   |   |
| Common      shares, $.10 par value; 18,000,000 shares          authorized, 15,928,810 and 12,846,608 shares issued,          of which 889,780 and 1,631,364 shares were reacquired          and held in treasury at the respective dates |   |   | 1,592,881    |   |   |   | 1,284,661 |   |
| Additional      paid-in capital                                                                                                                                                                                                                                                       |   |   | 1,897,655    |   |   |   | 7,910,708 |   |
| Retained      earnings                                                                                                                                                                                                                                                                |   |   | 83,267,096   |   |   |   | 74,657,888 |   |
| Accumulated      other comprehensive income (loss)                                                                                                                                                                                                                                    |   |   | 1,340,427    |   |   |   | (33,471 | ) |
| Treasury      shares, at cost                                                                                                                                                                                                                                                         |   |   | (4,854,891   | )      |   |   | (11,506,654 | ) |
| Total      shareholders’ equity                                                                                                                                                                                                                                                 |   |   | 83,243,168   |   |   |   | 72,313,132 |   |
| Total      liabilities and shareholders’ equity                                                                                                                                                                                                                                 |   |   | $109,410,903 |   |   |   | $96,741,657 |   |

----

Index

CONSOLIDATED STATEMENT OF CASH FLOWS

|   |   | Years      ended January 31, |   |
|--------|--------|------------------------------|--------|
|   |   | 2008                         |   |   | 2007 |   |   | 2006 |   |

| Cash      flows from operating activities                                                                                                                            |   |   |        |   |   |   |        |   |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|-------------|--------|--------|--------|-------------|--------|--------|
| Net      income                                                                                                                                                      |   |   | $11,906,165 |   |   |   | $6,926,804  |   |   |   | $7,313,284 |   |
| Adjustments      to reconcile net income to net                   cash provided by operating activities: |   |   |        |   |   |   |        |   |   |   |   |   |
| Depreciation      and amortization                                                                                                                                   |   |   | 1,738,625   |   |   |   | 1,602,138   |   |   |   | 1,486,340 |   |
| Deferred      income taxes                                                                                                                                           |   |   | 1,369,460   |   |   |   | 26,203      |   |   |   | 610,593 |   |
| (Gain)      loss on sales of property and equipment, net                                                                                                             |   |   | (3,556,088  | )      |   |   | 13,310      |   |   |   | 13,131 |   |
| Stock-based      compensation                                                                                                                                        |   |   | 510,108     |   |   |   | 327,200     |   |   |   | - |   |
| Allowance      for doubtful accounts                                                                                                                                 |   |   | 19,352      |   |   |   | (114,238    | )      |   |   | 34,002 |   |
| (Increase)      decrease in operating assets:                                                                                                                        |   |   |        |   |   |   |        |   |   |   |   |   |
| Accounts      receivable                                                                                                                                             |   |   | (2,633,358  | )      |   |   | (1,831,614  | )      |   |   | (4,428,817 | ) |
| Inventories                                                                                                                                                          |   |   | (1,197,111  | )      |   |   | (3,161,103  | )      |   |   | (2,657,517 | ) |
| Prepaid      expenses and deposits                                                                                                                                   |   |   | (754        | )      |   |   | 2,872       |   |   |   | (141,097 | ) |
| Other      assets                                                                                                                                                    |   |   | (115,992    | )      |   |   | 332,466     |   |   |   | (484,162 | ) |
| Increase      (decrease) in operating liabilities:                                                                                                                   |   |   |        |   |   |   |        |   |   |   |   |   |
| Accounts      payable and accrued expenses                                                                                                                           |   |   | 2,654,425   |   |   |   | 255,908     |   |   |   | 228,250 |   |
| Customers’      advances                                                                                                                                       |   |   | (723,531    | )      |   |   | (721,878    | )      |   |   | 409,760 |   |
| Other      non-current liabilities                                                                                                                                   |   |   | (96,157     | )      |   |   | 242,084     |   |   |   | 2,057,647 |   |
| Net      cash provided by operating activities                                                                                                                       |   |   | 9,875,144   |   |   |   | 3,900,152   |   |   |   | 4,441,414 |   |
|                                                                                                                                                                 |   |   |        |   |   |   |        |   |   |   |   |   |
| Cash      flows from investing activities                                                                                                                            |   |   |        |   |   |   |        |   |   |   |   |   |
| Proceeds      from sales of property and equipment                                                                                                                   |   |   | 4,396,164   |   |   |   | 14,310      |   |   |   | 31,565 |   |
| Acquisitions      of property and equipment                                                                                                                          |   |   | (5,456,418  | )      |   |   | (4,398,910  | )      |   |   | (4,151,253 | ) |
| Increase      in securities available for sale                                                                                                                       |   |   | -           |   |   |   | (21,820     | )      |   |   | - |   |
| Net      cash (used in) investing activities                                                                                                                         |   |   | (1,060,254  | )      |   |   | (4,406,420  | )      |   |   | (4,119,688 | ) |
|                                                                                                                                                                 |   |   |        |   |   |   |        |   |   |   |   |   |
| Cash      flows from financing activities                                                                                                                            |   |   |        |   |   |   |        |   |   |   |   |   |
| Proceeds      from new borrowings                                                                                                                                    |   |   | -           |   |   |   | 4,312,293   |   |   |   | 793,947 |   |
| Reduction      of debt                                                                                                                                               |   |   | (1,499,334  | )      |   |   | (1,492,699  | )      |   |   | (1,800,910 | ) |
| Exercise      of stock options                                                                                                                                       |   |   | 1,081,835   |   |   |   | 147,174     |   |   |   | 324,281 |   |
| Payment      of dividends                                                                                                                                            |   |   | (3,101,839  | )      |   |   | (2,857,423  | )      |   |   | (2,648,576 | ) |
| Purchase      of treasury shares                                                                                                                                     |   |   | (630,515    | )      |   |   | -           |   |   |   | (140,135 | ) |
| Payment      of cash in lieu of fractional shares                                                                                                                    |   |   | (1,642      | )      |   |   | -           |   |   |   | (1,914 | ) |
| Net      cash provided by (used in) financing activities                                                                                                             |   |   | (4,151,495  | )      |   |   | 109,345     |   |   |   | (3,473,307 | ) |
| Effect      of exchange rate changes on cash                                                                                                                         |   |   | (78,712     | )      |   |   | 35,812      |   |   |   | (54,590 | ) |
| Net      increase (decrease) in cash and cash equivalents                                                                                                            |   |   | 4,584,683   |   |   |   | (361,111    | )      |   |   | (3,206,171 | ) |
| Cash      and cash equivalents at beginning of year                                                                                                                  |   |   | 17,322,194  |   |   |   | 17,683,305  |   |   |   | 20,889,476 |   |
| Cash      and cash equivalents at end of year                                                                                                                        |   |   | $21,906,877 |   |   |   | $17,322,194 |   |   |   | $17,683,305 |   |

----

Index

CONSOLIDATED STATEMENT OF SHAREHOLDERS’EQUITY

|                                                                                             |   | CommonShares |       |   | AdditionalPaid-inCapital |   |       | RetainedEarnings |   |   | AccumulatedOtherComprehensiveIncome/(Loss) |   |   | TreasuryShares |       |   | Total  |   |
|--------------------------------------------------------------------------------------------------|--------|--------------|------------|--------|--------------------------|--------|------------|------------------|--------|--------|--------------------------------------------|--------|--------|----------------|------------|--------|--------|--------|
| Balances,      January 31, 2005                                                                  |   |         | $963,496   |   |                     |   | $7,930,646 |             |   |   | $66,032,446                                |   |   |           | $100,635   |   |   |   | ($11,862,032 | ) |   |   | $63,165,191 |   |
| Comprehensive      income:                                                                       |   |         |       |   |                     |   |       |             |   |   |                                       |   |   |           |       |   |   |   |   |   |   |   |   |   |
| Net      income                                                                                  |   |         | -          |   |                     |   | -          |             |   |   | 7,313,284                                  |   |   |           | -          |   |   |   | - |   |   |   |   |   |
| Foreign      currency translation adjustment                                                     |   |         | -          |   |                     |   | -          |             |   |   | -                                          |   |   |           | (168,362   | )      |   |   | - |   |   |   |   |   |
| Interest      rate swap, net of tax of ($40,614)                                                 |   |         | -          |   |                     |   | -          |             |   |   | -                                          |   |   |           | 79,400     |   |   |   | - |   |   |   |   |   |
| Minimum      pension liability adjustment,          net of tax of $188,347        |   |         | -          |   |                     |   | -          |             |   |   | -                                          |   |   |           | (333,494   | )      |   |   | - |   |   |   |   |   |
| Total      comprehensive income                                                                  |   |         |       |   |                     |   |       |             |   |   |                                       |   |   |           |       |   |   |   |   |   |   |   | 6,890,828 |   |
| Stock      split four-for-three                                                                  |   |         | 321,165    |   |                     |   | (321,165   | )                |   |   | -                                          |   |   |           | -          |   |   |   | - |   |   |   | - |   |
| Cash      in lieu of fractional shares                                                           |   |         | -          |   |                     |   | (1,914     | )                |   |   | -                                          |   |   |           | -          |   |   |   | - |   |   |   | (1,914 | ) |
| Dividends      paid, $.1788 per share                                                            |   |         | -          |   |                     |   | -          |             |   |   | (2,000,194                                 | )      |   |           | -          |   |   |   | - |   |   |   | (2,000,194 | ) |
| Dividend      declared, $.0625 per share                                                         |   |         | -          |   |                     |   | -          |             |   |   | (699,819                                   | )      |   |           | -          |   |   |   | - |   |   |   | (699,819 | ) |
| Stock      option transactions                                                                   |   |         | -          |   |                     |   | (43,387    | )                |   |   | -                                          |   |   |           | -          |   |   |   | 367,668 |   |   |   | 324,281 |   |
| Purchase      of 12,548 treasury shares                                                          |   |         | -          |   |                     |   | -          |             |   |   | -                                          |   |   |           | -          |   |   |   | (140,135 | ) |   |   | (140,135 | ) |
| Balances,      January 31, 2006                                                                  |   |         | 1,284,661  |   |                     |   | 7,564,180  |             |   |   | 70,645,717                                 |   |   |           | (321,821   | )      |   |   | (11,634,499 | ) |   |   | 67,538,238 |   |
| Comprehensive      income:                                                                       |   |         |       |   |                     |   |       |             |   |   |                                       |   |   |           |       |   |   |   |   |   |   |   |   |   |
| Net      income                                                                                  |   |         | -          |   |                     |   | -          |             |   |   | 6,926,804                                  |   |   |           | -          |   |   |   | - |   |   |   |   |   |
| Foreign      currency translation adjustment                                                     |   |         | -          |   |                     |   | -          |             |   |   | -                                          |   |   |           | 291,299    |   |   |   | - |   |   |   |   |   |
| Interest      rate swap, net of tax of $21,772                                                   |   |         | -          |   |                     |   | -          |             |   |   | -                                          |   |   |           | (36,040    | )      |   |   | - |   |   |   |   |   |
| Securities      available for sale,          net of tax of ($840)                 |   |         | -          |   |                     |   | -          |             |   |   | -                                          |   |   |           | 1,430      |   |   |   | - |   |   |   |   |   |
| Minimum      pension liability adjustment,     net      of tax of $16,075    |   |         | -          |   |                     |   | -          |             |   |   | -                                          |   |   |           | 31,661     |   |   |   | - |   |   |   |   |   |
| Total      comprehensive income                                                                  |   |         |       |   |                     |   |       |             |   |   |                                       |   |   |           |       |   |   |   |   |   |   |   | 7,215,154 |   |
| Dividends      paid, $.1925 per share                                                            |   |         | -          |   |                     |   | -          |             |   |   | (2,157,604                                 | )      |   |           | -          |   |   |   | - |   |   |   | (2,157,604 | ) |
| Dividend      declared, $.0675 per share                                                         |   |         | -          |   |                     |   | -          |             |   |   | (757,029                                   | )      |   |           | -          |   |   |   | - |   |   |   | (757,029 | ) |
| Stock-based      compensation                                                                    |   |         | -          |   |                     |   | 327,200    |             |   |   | -                                          |   |   |           | -          |   |   |   | - |   |   |   | 327,200 |   |
| Stock      option transactions                                                                   |   |         | -          |   |                     |   | 19,328     |             |   |   | -                                          |   |   |           | -          |   |   |   | 127,845 |   |   |   | 147,173 |   |
| Balances,      January 31, 2007                                                                  |   |         | 1,284,661  |   |                     |   | 7,910,708  |             |   |   | 74,657,888                                 |   |   |           | (33,471    | )      |   |   | (11,506,654 | ) |   |   | 72,313,132 |   |
| Comprehensive      income:                                                                       |   |         |       |   |                     |   |       |             |   |   |                                       |   |   |           |       |   |   |   |   |   |   |   |   |   |
| Net      income                                                                                  |   |         | -          |   |                     |   | -          |             |   |   | 11,906,165                                 |   |   |           | -          |   |   |   | - |   |   |   |   |   |
| Adoption      of FIN No. 48                                                                      |   |         | -          |   |                     |   | -          |             |   |   | (125,000                                   | )      |   |           | -          |   |   |   | - |   |   |   |   |   |
| Foreign      currency translation adjustment                                                     |   |         | -          |   |                     |   | -          |             |   |   | -                                          |   |   |           | 760,412    |   |   |   | - |   |   |   |   |   |
| Interest      rate swap, net of tax of $34,645                                                   |   |         | -          |   |                     |   | -          |             |   |   | -                                          |   |   |           | (58,990    | )      |   |   | - |   |   |   |   |   |
| Securities      available for sale,     net      of tax of $1,377            |   |         | -          |   |                     |   | -          |             |   |   | -                                          |   |   |           | (2,344     | )      |   |   | - |   |   |   |   |   |
| Minimum      pension liability adjustment,     net      of tax of ($396,323) |   |         | -          |   |                     |   | -          |             |   |   | -                                          |   |   |           | 674,820    |   |   |   | - |   |   |   |   |   |
| Total      comprehensive income                                                                  |   |         |       |   |                     |   |       |             |   |   |                                       |   |   |           |       |   |   |   |   |   |   |   | 13,155,063 |   |
| Stock      split four-for-three                                                                  |   |         | 398,220    |   |                     |   | (398,220   | )                |   |   | -                                          |   |   |           | -          |   |   |   | - |   |   |   | - |   |
| Cash      in lieu of fractional shares                                                           |   |         | -          |   |                     |   | (1,642     | )                |   |   | -                                          |   |   |           | -          |   |   |   | - |   |   |   | (1,642 | ) |
| Dividends      paid, $.1518 per share                                                            |   |         | -          |   |                     |   | -          |             |   |   | (2,344,810                                 | )      |   |           | -          |   |   |   | - |   |   |   | (2,344,810 | ) |
| Dividend      declared, $.055 per share                                                          |   |         | -          |   |                     |   | -          |             |   |   | (827,147                                   | )      |   |           | -          |   |   |   | - |   |   |   | (827,147 | ) |
| Stock-based      compensation                                                                    |   |         | -          |   |                     |   | 510,108    |             |   |   | -                                          |   |   |           | -          |   |   |   | - |   |   |   | 510,108 |   |
| Stock      option transactions                                                                   |   |         | -          |   |                     |   | 351,557    |             |   |   | -                                          |   |   |           | -          |   |   |   | 730,278 |   |   |   | 1,081,835 |   |
| Purchase      of 51,205 treasury shares                                                          |   |         | -          |   |                     |   | -          |             |   |   | -                                          |   |   |           | -          |   |   |   | (630,515 | ) |   |   | (630,515 | ) |
| Treasury      share retirement (900,000 shares)                                                  |   |         | (90,000    | )      |                     |   | (6,462,000 | )                |   |   | -                                          |   |   |           | -          |   |   |   | 6,552,000 |   |   |   | - |   |
| Stock      option tax loss                                                                       |   |         | -          |   |                     |   | (12,856    | )                |   |   | -                                          |   |   |           | -          |   |   |   | - |   |   |   | (12,856 | ) |
| Balances,      January 31, 2008                                                                  |   |         | $1,592,881 |   |                     |   | $1,897,655 |             |   |   | $83,267,096                                |   |   |           | $1,340,427 |   |   |   | ($4,854,891 | ) |   |   | $83,243,168 |   |

----

Index

CONSOLIDATED BUSINESS SEGMENT DATA

|                                                 |   | Years ended January 31, |         |
|------------------------------------------------------|--------|----------------------------------------|--------------|
|                                                 |   | 2008                                   |         |   | 2007 |   |   | 2006 |   |
| Net      sales to unaffiliated customers             |   |                                   |         |   |   |   |   |   |   |
| Product      recovery/pollution control technologies |   |                                   | $56,897,328  |   |   |   | $47,685,248 |   |   |   | $44,283,869 |   |
| Fluid      handling technologies                     |   |                                   | 27,578,301   |   |   |   | 26,099,803 |   |   |   | 23,774,478 |   |
| Filtration/purification      technologies            |   |                                   | 22,392,220   |   |   |   | 19,720,453 |   |   |   | 19,628,706 |   |
|                                                 |   |                                   | $106,867,849 |   |   |   | $93,505,504 |   |   |   | $87,687,053 |   |
| Includes      foreign sales of:                      |   |                                   |         |   |   |   |   |   |   |   |   |   |
| Product      recovery/pollution control technologies |   |                                   | $14,559,153  |   |   |   | $8,470,879 |   |   |   | $7,659,390 |   |
| Fluid      handling technologies                     |   |                                   | 6,669,921    |   |   |   | 7,017,331 |   |   |   | 5,930,596 |   |
| Filtration/purification      technologies            |   |                                   | 8,978,969    |   |   |   | 7,063,165 |   |   |   | 7,694,059 |   |
|                                                 |   |                                   | $30,208,043  |   |   |   | $22,551,375 |   |   |   | $21,284,045 |   |
|                                                 |   |                                   |         |   |   |   |   |   |   |   |   |   |
| Income      from operations                          |   |                                   |         |   |   |   |   |   |   |   |   |   |
| Product      recovery/pollution control technologies |   |                                   | $6,573,097   |   |   |   | $4,339,795 |   |   |   | $4,119,242 |   |
| Fluid      handling technologies                     |   |                                   | 5,895,780    |   |   |   | 4,362,276 |   |   |   | 3,540,428 |   |
| Filtration/purification      technologies            |   |                                   | 1,614,674    |   |   |   | 1,055,004 |   |   |   | 2,002,934 |   |
| Gain      on sale of building                        |   |                                   | 3,513,940    |   |   |   | - |   |   |   | - |   |
|                                                 |   |                                   | $17,597,491  |   |   |   | $9,757,075 |   |   |   | $9,662,604 |   |
|                                                 |   |                                   |         |   |   |   |   |   |   |   |   |   |
| Depreciation      and amortization expense           |   |                                   |         |   |   |   |   |   |   |   |   |   |
| Product      recovery/pollution control technologies |   |                                   | $511,350     |   |   |   | $473,354 |   |   |   | $480,173 |   |
| Fluid      handling technologies                     |   |                                   | 655,048      |   |   |   | 632,464 |   |   |   | 578,861 |   |
| Filtration/purification      technologies            |   |                                   | 572,227      |   |   |   | 496,320 |   |   |   | 427,306 |   |
|                                                 |   |                                   | $1,738,625   |   |   |   | $1,602,138 |   |   |   | $1,486,340 |   |
|                                                 |   |                                   |         |   |   |   |   |   |   |   |   |   |
| Capital      expenditures                            |   |                                   |         |   |   |   |   |   |   |   |   |   |
| Product      recovery/pollution control technologies |   |                                   | $3,543,346   |   |   |   | $252,777 |   |   |   | $250,327 |   |
| Fluid      handling equipment technologies           |   |                                   | 1,171,855    |   |   |   | 2,237,574 |   |   |   | 1,446,380 |   |
| Filtration/purification      technologies            |   |                                   | 469,142      |   |   |   | 1,571,101 |   |   |   | 349,443 |   |
|                                                 |   |                                   | 5,184,343    |   |   |   | 4,061,452 |   |   |   | 2,046,150 |   |
| Corporate                                            |   |                                   | 262,075      |   |   |   | 337,458 |   |   |   | 2,105,103 |   |
|                                                 |   |                                   | $5,456,418   |   |   |   | $4,398,910 |   |   |   | $4,151,253 |   |
|                                                 |   |                                   |         |   |   |   |   |   |   |   |   |   |
| Identifiable      assets at January 31               |   |                                   |         |   |   |   |   |   |   |   |   |   |
| Product      recovery/pollution control technologies |   |                                   | $40,509,227  |   |   |   | $34,907,323 |   |   |   | $34,173,031 |   |
| Fluid      handling technologies                     |   |                                   | 22,401,768   |   |   |   | 21,667,719 |   |   |   | 17,008,765 |   |
| Filtration/purification      technologies            |   |                                   | 21,688,419   |   |   |   | 20,514,339 |   |   |   | 17,653,316 |   |
|                                                 |   |                                   | 84,599,414   |   |   |   | 77,089,381 |   |   |   | 68,835,112 |   |
| Corporate                                            |   |                                   | 24,811,489   |   |   |   | 19,652,276 |   |   |   | 20,236,279 |   |
|                                                 |   |                                   | $109,410,903 |   |   |   | $96,741,657 |   |   |   | $89,071,391 |   |

----

Index

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED JANUARY 31, 2008, 2007 AND2006

| NOTE      1: | NATURE      OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING    POLICIES |
|--------------|-----------------------------------------------------------------------------|

|                            | Years            |
|---------------------------------|------------------|
| Buildings      and improvements | 10-39            |
| Machinery      and equipment    |   5-10 |
| Furniture      and fixtures     | 5-7              |
| Automotive      equipment       | 3                |

----

Index

|                                     |   | Product Recovery/Pollution Control Technologies |        |   | Fluid Handling Technologies |   |    | Filtration/Purification Technologies |   |   | Total      |   |
|------------------------------------------|--------|----------------------------------------------------------------|-------------|--------|---------------------------------------|--------|---------|-------------------------------------------|--------|--------|------------|--------|
| Balance      as of February 1, 2007      |   |                                                           | $15,706,667 |   |                                  |   | $11,542 |                                      |   |   | $5,080,704 |   |   |   | $20,798,913 |   |
| Goodwill      acquired during the period |   |                                                           | -           |   |                                  |   | -       |                                      |   |   | -          |   |   |   | - |   |
| Balance      as of January 31, 2008      |   |                                                           | $15,706,667 |   |                                  |   | $11,542 |                                      |   |   | $5,080,704 |   |   |   | $20,798,913 |   |

----

Index

----

Index

|   |   | 2008 |   |   | 2007 |   |   | 2006 |   |
|--------|--------|------|--------|--------|------|--------|--------|------|--------|

| Cash      paid during the year for: |   |   |      |   |   |   |      |   |   |
|-------------------------------------|--------|--------|-----------|--------|--------|--------|-----------|--------|--------|
| Interest                            |   |   | $331,555  |   |   |   | $357,130  |   |   |   | $263,433 |   |
| Income      taxes                   |   |   | 4,829,003 |   |   |   | 3,824,715 |   |   |   | 2,009,523 |   |

----

Index

----

Index

|                                                                                                                                                                                                                                  | January 31, |         |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------|--------------|
|                                                                                                                                                                                                                                  | 2008             |         |   | 2007 |   |   | 2006 |   |
| Net      sales as previously reported                                                                                                                                                                                                 |             | $102,888,418 |   |   |   | $90,592,484 |   |   |   | $85,116,100 |   |
| Reclassification      of freight out,            and representative and distributor       commissions      previously netted            against sales |             | 3,979,431    |   |   |   | 2,913,020 |   |   |   | 2,570,953 |   |
| Net      sales, as reported                                                                                                                                                                                                           |             | $106,867,849 |   |   |   | $93,505,504 |   |   |   | $87,687,053 |   |
|                                                                                                                                                                                                                                  |             |         |   |   |   |   |   |   |   |   |   |
| Cost      of goods sold as            previously reported                                                                                                                                                    |             | $69,278,959  |   |   |   | $62,477,267 |   |   |   | $58,441,441 |   |
| Reclassification      of freight out       previously      netted against sales                                                                                                                         |             | 1,216,522    |   |   |   | 982,729 |   |   |   | 722,438 |   |
| Cost      of goods sold, as reported                                                                                                                                                                                                  |             | $70,495,481  |   |   |   | $63,459,996 |   |   |   | $59,163,879 |   |
|                                                                                                                                                                                                                                  |             |         |   |   |   |   |   |   |   |   |   |
| Selling      expenses as previously reported                                                                                                                                                                                          |             | $8,721,621   |   |   |   | $8,258,379 |   |   |   | $7,864,833 |   |
| Reclassification      of representative       and      distributor commissions            previously netted against sales                                                      |             | 2,762,909    |   |   |   | 1,930,291 |   |   |   | 1,848,515 |   |
| Selling      expenses, as reported                                                                                                                                                                                                    |             | $11,484,530  |   |   |   | $10,188,670 |   |   |   | $9,713,348 |   |

| NOTE      2: | FAIR      VALUE OF FINANCIAL INSTRUMENTS |
|--------------|------------------------------------------|

|   |   |          January 31, |   |
|--------|--------|------------------------------------------|--------|
|   |   | 2008                                     |   |   |        2007 |   |

| Fair      value      |   |   | $6,084,990 |   |   |   | $7,371,688 |   |
|----------------------|--------|--------|------------|--------|--------|--------|------------|--------|
| Carrying      amount |   |   | 6,104,164  |   |   |   | 7,373,192  |   |

----

Index

| NOTE      3: | INVENTORIES |
|--------------|-------------|

|                 |   | January 31, |        |
|----------------------|--------|------------------|-------------|
|                 |   | 2008             |        |   | 2007 |   |
| Raw      materials   |   |             | $15,817,283 |   |   |   | $13,596,396 |   |
| Work      in process |   |             | 2,384,413   |   |   |   | 2,790,042 |   |
| Finished      goods  |   |             | 3,056,531   |   |   |   | 3,334,404 |   |
|                 |   |             | $21,258,227 |   |   |   | $19,720,842 |   |

| NOTE      4: | PROPERTY,      PLANT AND EQUIPMENT |
|--------------|------------------------------------|

|                               |   | January 31, |        |
|------------------------------------|--------|------------------|-------------|
|                               |   | 2008             |        |   | 2007 |   |
| Land                               |   |             | $2,499,767  |   |   |   | $2,155,061 |   |
| Buildings      and improvements    |   |             | 19,454,967  |   |   |   | 17,631,279 |   |
| Machinery      and equipment       |   |             | 12,909,550  |   |   |   | 11,653,472 |   |
| Furniture      and fixtures        |   |             | 4,621,225   |   |   |   | 4,358,170 |   |
| Automotive      equipment          |   |             | 1,559,604   |   |   |   | 1,462,080 |   |
| Construction      in progress      |   |             | 376,324     |   |   |   | 206,898 |   |
|                               |   |             | 41,421,437  |   |   |   | 37,466,960 |   |
| Less      accumulated depreciation |   |             | 21,187,610  |   |   |   | 20,633,972 |   |
|                               |   |             | $20,233,827 |   |   |   | $16,832,988 |   |

----

Index

| NOTE      5: | DEBT |
|--------------|------|

|                                                                                                                                                                                                                                                                                                                                                                                                                            |   | January 31,2008 |       |   | January 31,2007 |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------|------------|--------|----------------------|--------|
| Bond      payable, bank, payable in     quarterly      installments of $58,460,          plus interest at a rate of 16 basis points     below      the ninety day LIBOR rate          (effective interest rate of 4.80% at          January 31, 2008), maturing April, 2021,          collateralized by the Telford, PA building |   |                 | $3,098,404 |   |                 |   | $3,332,246 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                 |       |   |                 |   |   |   |
| Note      payable, bank, payable in          quarterly installments of $300,000,          plus interest at a rate of 75 basis points          over the ninety day LIBOR rate          (effective interest rate of 5.71% at          January 31, 2008), maturing October, 2008                                                                        |   |                 | 1,200,000  |   |                 |   | 2,400,000 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                 |       |   |                 |   |   |   |
| Note      payable, bank, payable in          quarterly installments of $37,165          (25,000 Euro), plus interest at a          fixed rate of 3.82%, maturing          January, 2016                                                                                                                                                                             |   |                 | 1,189,280  |   |                 |   | 1,173,061 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                 |       |   |                 |   |   |   |
| Line      of credit, $445,980 (300,000 Euro),          payable upon demand, plus     interest      at a rate of 70 basis points          over the thirty day EURIBOR rate          (effective interest rate of 4.89% at          January 31, 2008)                                                                                              |   |                 | 445,980    |   |                 |   | 391,020 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                 |       |   |                 |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                 | 5,933,664  |   |                 |   | 7,296,327 |   |
| Less      current portion                                                                                                                                                                                                                                                                                                                                                                                                       |   |                 | 2,028,482  |   |                 |   | 1,955,202 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                            |   |                 | 3,905,182  |   |                 |   | 5,341,125 |   |
| Fair      market value of interest rate          swap liability                                                                                                                                                                                                                                                                                                                                                  |   |                 | 170,500    |   |                 |   | 76,865 |   |
| Long-term      portion                                                                                                                                                                                                                                                                                                                                                                                                          |   |                 | $4,075,682 |   |                 |   | $5,417,990 |   |

----

Index

| Year EndingJanuary 31, |   |   |       |
|----------------------------------|--------|--------|------------|
| 2009                             |   |   | $2,028,482 |   |
| 2010                             |   |   | 382,500    |   |
| 2011                             |   |   | 382,500    |   |
| 2012                             |   |   | 382,500    |   |
| 2013                             |   |   | 382,500    |   |
| Thereafter                       |   |   | 2,375,182  |   |
|                             |   |   | $5,933,664 |   |

| NOTE      6: | ACCUMULATED      OTHER COMPREHENSIVE INCOME/(LOSS) |
|--------------|----------------------------------------------------|

|   |   | 2008 |   |   |           2007 |   |
|--------|--------|------|--------|--------|------------------------------------|--------|

| Interest      rate swap, net of tax                                      |   |   | ($107,415  | )      |   |   | ($48,425 | )      |
|--------------------------------------------------------------------------|--------|--------|------------|--------|--------|--------|----------|--------|
| Unrealized      gain (loss) on securities available-for sale, net of tax |   |   | (914       | )      |   |   | 1,430    |   |
| Foreign      currency translation adjustment                             |   |   | 1,452,142  |   |   |   | 691,730  |   |
| Minimum      pension liability adjustment, net of tax                    |   |   | (3,386     | )      |   |   | (678,206 | )      |
|                                                                     |   |   | $1,340,427 |   |   |   | ($33,471 | )      |

| NOTE      7: | SHAREHOLDERS’      EQUITY |
|--------------|---------------------------------|

----

Index

| NOTE      8: | STOCK-BASED      COMPENSATION |
|--------------|-------------------------------|

----

Index

|                         | Fiscal Years EndedJanuary 31, |
|------------------------------|----------------------------------------------|
|                         | 2008                                         |   | 2007 |
|                         |                                         |   |   |
| Expected      term (years)   | 5.0                                          |   | 5.0 |
| Risk-free      interest rate | 4.50%      - 4.58%                           |   | 3.63%      - 4.58% |
| Expected      volatility     | 29%      - 30%                               |   | 30%      - 32% |
| Dividend      yield          | 1.86%      - 3.39%                           |   | 2.26%      - 3.39% |

|                                        |   | Shares |      |   | WeightedAverageExercise Price |   |    | WeightedAverageRemainingLife (years) |   |   | AggregateIntrinsic Value |   |
|---------------------------------------------|--------|--------|-----------|--------|------------------------------------|--------|---------|-------------------------------------------|--------|--------|-------------------------------|--------|
| Options:                                    |   |   |      |   |                               |   |    |                                      |   |   |                          |   |
|        Outstanding at February 1, 2007 |   |   | 1,275,947 |   |                               |   | $8.0169 |                                      |   |   | 7.49                          |   |   |   |   |
|        Granted                         |   |   | 215,800   |   |                               |   | 11.7500 |                                      |   |   |                          |   |   |   |   |
|        Forfeited                       |   |   | 16,889    |   |                               |   | 10.5059 |                                      |   |   |                          |   |   |   |   |
|        Expired                         |   |   | -         |   |                               |   | -       |                                      |   |   |                          |   |   |   |   |
|        Exercised                       |   |   | 136,577   |   |                               |   | 7.9210  |                                      |   |   |                          |   |   |   |   |
|        Outstanding at January 31, 2008 |   |   | 1,338,281 |   |                               |   | $8.5972 |                                      |   |   | 7.14                          |   |   |   | $2,762,275 |   |
|                                        |   |   |      |   |                               |   |    |                                      |   |   |                          |   |   |   |   |   |
|        Exercisable at January 31, 2008 |   |   | 972,244   |   |                               |   | $7.5419 |                                      |   |   | 7.14                          |   |   |   | $2,762,275 |   |

|   |   | Options Outstanding |   |   | Options Exercisable                              |   |
|--------|--------|--------------------------|--------|--------|-------------------------------------------------------|--------|
|   |   | Shares                   |   |   | Weighted Average RemainingLife (years) |   |   | Weighted AverageExercise Price |   |   | Shares |   |   | Weighted AverageExercise Price |   |

| Range      of prices:     |   |   |      |   |   |   |   |   |   |   |    |   |   |   |    |
|---------------------------|--------|--------|-----------|--------|--------|--------|--------|--------|--------|--------|---------|--------|--------|--------|---------|
| $4.11      – 4.99   |   |   | 43,974    |   |   |   | 1.91   |   |   |   | $4.1648 |   |   |   | 43,974  |   |   |   | $4.1648 |   |
| $5.00      – 5.49   |   |   | 79,177    |   |   |   | 3.07   |   |   |   | 5.1047  |   |   |   | 79,177  |   |   |   | 5.1047 |   |
| $5.50      – 6.99   |   |   | 245,515   |   |   |   | 4.67   |   |   |   | 5.5306  |   |   |   | 245,515 |   |   |   | 5.5306 |   |
| $7.00      – 8.99   |   |   | 184,013   |   |   |   | 7.07   |   |   |   | 7.4110  |   |   |   | 184,013 |   |   |   | 7.4110 |   |
| $9.00      – 9.99   |   |   | 344,463   |   |   |   | 7.15   |   |   |   | 9.3051  |   |   |   | 344,463 |   |   |   | 9.3051 |   |
| $10.00      – 10.99 |   |   | 225,339   |   |   |   | 8.88   |   |   |   | 10.8925 |   |   |   | 75,102  |   |   |   | 10.8925 |   |
| $11.00      – 11.99 |   |   | 215,800   |   |   |   | 9.87   |   |   |   | 11.7500 |   |   |   | -       |   |   |   | - |   |
|                      |   |   | 1,338,281 |   |   |   | 7.14   |   |   |   | $8.5972 |   |   |   | 972,244 |   |   |   | $7.5419 |   |

----

Index

|                                                                                                                                                                                     |   | January 31,2006 |       |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------|------------|
|                                                                                                                                                                                     |   |                 |       |
| Net      income, as reported                                                                                                                                                             |   |                 | $7,313,284 |   |
| Add:        Stock-based employee compensation expense             included      in reported net income, net of tax |   |                 | -          |   |
| Less:        Pro-forma expense related to stock options granted,             net      of tax effects               |   |                 | (308,080   | ) |
| Pro-forma                                                                                                                                                                                |   |                 | $7,005,204 |   |
| Earnings      per share, basic:                                                                                                                                                          |   |                 |       |   |
| As      reported                                                                                                                                                                         |   |                 | $.49       |   |
| Pro-forma                                                                                                                                                                                |   |                 | .46        |   |
| Earnings      per share, diluted:                                                                                                                                                        |   |                 |       |   |
| As      reported                                                                                                                                                                         |   |                 | $.48       |   |
| Pro-forma                                                                                                                                                                                |   |                 | .46        |   |

| NOTE      9: | INCOME      TAXES |
|--------------|-------------------|

|     |   | 2008     |       |   | 2007     |   |       | 2006     |   |
|----------|--------|------------------------------|------------|--------|------------------------------|--------|------------|------------------------------|--------|
| Current  |   |                         |       |   |                         |   |       |                         |   |
| Federal  |   |                         | $4,261,462 |   |                         |   | $2,884,686 |                         |   |   | $1,601,149 |   |
| State    |   |                         | 560,130    |   |                         |   | 409,160    |                         |   |   | 236,709 |   |
| Foreign  |   |                         | 164,664    |   |                         |   | 91,660     |                         |   |   | 260,416 |   |
|     |   |                         | 4,986,256  |   |                         |   | 3,385,506  |                         |   |   | 2,098,274 |   |
| Deferred |   |                         | 1,369,460  |   |                         |   | 26,203     |                         |   |   | 610,593 |   |
|     |   |                         | $6,355,716 |   |                         |   | $3,411,709 |                         |   |   | $2,708,867 |   |

----

Index

|                                |   | 2008   |        |   | 2007   |   |
|-------------------------------------|--------|--------|-------------|--------|--------|--------|
| Deferred      tax assets            |   |   |        |   |   |   |
| Inventory      cost capitalization  |   |   | $134,050    |   |   |   | $135,157 |   |
| Pension      cost                   |   |   | 797,591     |   |   |   | 1,232,328 |   |
| Non-compete      agreements         |   |   | 138,441     |   |   |   | 195,176 |   |
| Other                               |   |   | 499,163     |   |   |   | 374,865 |   |
| Total      deferred tax assets      |   |   | 1,569,245   |   |   |   | 1,937,526 |   |
|                                |   |   |        |   |   |   |   |   |
| Deferred      tax liabilities       |   |   |        |   |   |   |   |   |
| Property,      plant and equipment  |   |   | 1,660,604   |   |   |   | 649,252 |   |
| Inventory      - Dean Pump Division |   |   | 363,724     |   |   |   | 363,727 |   |
| Prepaid      expenses               |   |   | 245,982     |   |   |   | 231,736 |   |
| Goodwill                            |   |   | 2,628,680   |   |   |   | 2,307,633 |   |
| Total      deferred tax liabilities |   |   | 4,898,990   |   |   |   | 3,552,348 |   |
| Net      deferred tax (liabilities) |   |   | ($3,329,745 | )      |   |   | ($1,614,822 | ) |

|                                                                                                                   |                  2008 |       |   |                  2007 |   |   |            2006 |   |
|------------------------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------|------------|--------|------------------------------------------------------------------------------|--------|--------|------------------------------------------------------------------------|--------|
| Computed      expected           federal tax expense                                               |                                                                         | $6,239,308 |   |                                                                         |   | 34.2   | %                                                                      |   |   | $3,515,094 |   |   |   | 34.0 | % |   |   | $3,407,531 |   |   |   | 34.0 | % |
| Manufacturing      exemption                                                                                           |                                                                         | (291,025   | )      |                                                                         |   | (1.6   | )                                                                      |   |   | (108,014 | ) |   |   | (1.0 | ) |   |   | - |   |   |   | - |   |
| State      income taxes,           net of federal           income tax benefit |                                                                         | 369,686    |   |                                                                         |   | 2.0    |                                                                   |   |   | 284,648 |   |   |   | 2.7 |   |   |   | 156,228 |   |   |   | 1.5 |   |
| Research      and           development tax credits                                                |                                                                         | (104,435   | )      |                                                                         |   | (.6    | )                                                                      |   |   | (136,500 | ) |   |   | (1.3 | ) |   |   | (591,517 | ) |   |   | (5.9 | ) |
| Other                                                                                                                  |                                                                         | 142,182    |   |                                                                         |   | .8     |                                                                   |   |   | (143,519 | ) |   |   | (1.4 | ) |   |   | (263,375 | ) |   |   | (2.6 | ) |
| Effective      income taxes                                                                                            |                                                                         | $6,355,716 |   |                                                                         |   | 34.8   | %                                                                      |   |   | $3,411,709 |   |   |   | 33.0 | % |   |   | $2,708,867 |   |   |   | 27.0 | % |

----

Index

|                                             |   |                   2008 |     |
|--------------------------------------------------|--------|------------------------------------------------------------------------------------|----------|
| Balance      at February 1, 2007                 |   |                                                                               | $163,000 |   |
| Increases      in tax positions for prior years  |   |                                                                               | 179,000  |   |
| Decreases      in tax positions for prior years  |   |                                                                               | (163,000 | ) |
| Increases      in tax positions for current year |   |                                                                               | -        |   |
| Balance      at January 31, 2008                 |   |                                                                               | $179,000 |   |

|                 | Open Tax Year           |
|----------------------|-----------------------------------|
|                 | Examination in Progress |   | Examination Not Yet Initiated |
| United      States   |                              |   |   |
| Federal              | 2005      – 2006            |   | 2007      – 2008 |
| State                | 2005      – 2007            |   | 2008 |
| Canada               | n/a                               |   | 2004      – 2008 |
| The      Netherlands | n/a                               |   | 2004      – 2008 |

| NOTE      10: | LEASES      AND OTHER COMMITMENTS |
|---------------|-----------------------------------|

| 2009 |   |   | $52,544 |   |
|------|--------|--------|---------|--------|
| 2010 |   |   | 40,577  |   |
| 2011 |   |   | 20,288  |   |

----

Index

| NOTE 11: | EMPLOYEE      BENEFIT PLANS |
|----------|-----------------------------|

|                                                  |   |                2008 |       |   |              2007 |   |       |               2006 |   |
|-------------------------------------------------------|--------|------------------------------------------------------------------|------------|--------|------------------------------------------------------|--------|------------|------------------------------------------------------------|--------|
| Service      cost - benefits earned during the period |   |                                                             | $148,258   |   |                                                 |   | $708,246   |                                                       |   |   | $620,064 |   |
| Interest      cost on projected benefit obligation    |   |                                                             | 1,040,164  |   |                                                 |   | 1,071,627  |                                                       |   |   | 1,029,984 |   |
| Expected      return on assets                        |   |                                                             | (1,259,503 | )      |                                                 |   | (1,169,858 | )                                                          |   |   | (1,027,598 | ) |
| Amortization                                          |   |                                                             | 74,032     |   |                                                 |   | 186,051    |                                                       |   |   | 118,306 |   |
| Curtailment      loss                                 |   |                                                             | -          |   |                                                 |   | 234,180    |                                                       |   |   | - |   |
|                                                  |   |                                                             | $2,951     |   |                                                 |   | $1,030,246 |                                                       |   |   | $740,756 |   |

----

Index

|                                                                  |   |             2008 |        |   |              2007 |   |
|-----------------------------------------------------------------------|--------|------------------------------------------------|-------------|--------|------------------------------------------------------|--------|
|                                                                  |   |                                           |        |   |                                                 |   |
| Change      in benefit obligation:                                    |   |                                           |        |   |                                                 |   |
| Benefit      obligation at beginning of year                          |   |                                           | $18,512,657 |   |                                                 |   | $19,031,679 |   |
| Service      cost                                                     |   |                                           | 148,258     |   |                                                 |   | 708,246 |   |
| Interest      cost                                                    |   |                                           | 1,040,164   |   |                                                 |   | 1,071,627 |   |
| Amendments                                                            |   |                                           | 16,167      |   |                                                 |   | 155,004 |   |
| Actuarial      (gain)/loss                                            |   |                                           | (792,843    | )      |                                                 |   | 433,170 |   |
| Curtailment                                                           |   |                                           | -           |   |                                                 |   | (2,014,829 | ) |
| Benefits      paid                                                    |   |                                           | (947,498    | )      |                                                 |   | (872,240 | ) |
| Benefit      obligation at end of year                                |   |                                           | $17,976,905 |   |                                                 |   | $18,512,657 |   |
|                                                                  |   |                                           |        |   |                                                 |   |   |   |
| Change      in plan assets:                                           |   |                                           |        |   |                                                 |   |   |   |
| Fair      value of plan assets at beginning of year                   |   |                                           | $15,182,042 |   |                                                 |   | $14,107,986 |   |
| Actual      gain on plan assets                                       |   |                                           | 1,479,938   |   |                                                 |   | 1,814,190 |   |
| Employer      contribution                                            |   |                                           | 101,400     |   |                                                 |   | 132,106 |   |
| Benefits      paid                                                    |   |                                           | (947,498    | )      |                                                 |   | (872,240 | ) |
| Fair      value of plan assets at end of year                         |   |                                           | $15,815,882 |   |                                                 |   | $15,182,042 |   |
|                                                                  |   |                                           |        |   |                                                 |   |   |   |
| Funded      status                                                    |   |                                           | ($2,161,023 | )      |                                                 |   | ($3,330,615 | ) |
| Unrecognized      actuarial (gain)/loss                               |   |                                           | (268,113    | )      |                                                 |   | 785,902 |   |
| Unrecognized      transition (asset)                                  |   |                                           | (117        | )      |                                                 |   | (1,602 | ) |
| Unrecognized      prior service costs                                 |   |                                           | 273,604     |   |                                                 |   | 292,217 |   |
| Net      amount recognized                                            |   |                                           | ($2,155,649 | )      |                                                 |   | ($2,254,098 | ) |
|                                                                  |   |                                           |        |   |                                                 |   |   |   |
| Amounts      recognized in the consolidated balance sheet consist of: |   |                                           |        |   |                                                 |   |   |   |
| Accrued      benefit liability – short term                     |   |                                           | ($99,377    | )      |                                                 |   | ($99,472 | ) |
| Accrued      benefit liability – long term                      |   |                                           | (2,061,646  | )      |                                                 |   | (3,231,143 | ) |
| Accumulated      other comprehensive gain                             |   |                                           | 5,374       |   |                                                 |   | 1,076,517 |   |
| Net      amount recognized                                            |   |                                           | ($2,155,649 | )      |                                                 |   | ($2,254,098 | ) |

| Year EndingJanuary 31, |   |   |        |
|----------------------------------|--------|--------|-------------|
| 2009                             |   |   | $974,239    |   |
| 2010                             |   |   | 991,782     |   |
| 2011                             |   |   | 1,034,478   |   |
| 2012                             |   |   | 1,101,792   |   |
| 2013                             |   |   | 1,144,461   |   |
| 2014      - 2018                 |   |   | 6,363,119   |   |
|                             |   |   | $11,609,871 |   |

----

Index

|                                                                                                            | 2008  | 2007  | 2006                                           |
|-----------------------------------------------------------------------------------------------------------------|-------|-------|------------------------------------------------|
| Discount      rate                                                                                              | 6.25% | 5.75% | 5.75%                                          |
| Expected      long-term rate of          return on assets                                        | 8.50% | 8.50% | 8.50%                                          |
| Rate      of increase in          compensation levels          (where applicable) | 4.50% | 4.50% | 3%      for One YearThen      4.50% Thereafter |

|                                                                                                                  | 2008        | 2007                                          | 2006                                           |
|-----------------------------------------------------------------------------------------------------------------------|-------------|-----------------------------------------------|------------------------------------------------|
| Discount      rate                                                                                                    | 5.75%       | 5.75%                                         | 6.25%                                          |
| Expected      long-term rate of          return on assets                                              | 8.50%       | 8.50%                                         | 8.50%                                          |
| Rate      of increase in          compensation levels          (where applicable)  | 4.50%  | 3%      for One YearThen      4.50%Thereafter | 3%      for Two YearsThen      4.50%Thereafter |

|                    |   | 2007   |   |   | 2006   |   |
|-------------------------|--------|--------|--------|--------|--------|--------|
| Target      allocation: |   |   |   |   |   |   |

|        Equity securities           |   |   | 40-80  | %      |   |   | 40-80  | %      |   |
|-----------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
|        Debt securities             |   |   | 20-60  | %      |   |   | 20-60  | %      |   |
|                                    |   |   |   |   |   |   |   |   |   |
| Asset      allocation as of October 31: |   |   |   |   |   |   |   |   |   |
|        Equity securities           |   |   | 80     | %      |   |   | 75     | %      |   |
|        Debt securities             |   |   | 20     | %      |   |   | 25     | %      |   |
|        Total                       |   |   | 100    | %      |   |   | 100    | %      |   |

----

Index

----

Index

| 1997      Plan                                 |   | 2008   |                             |   | 2007   |   |                             | 2006   |   |
|------------------------------------------------|--------|--------|----------------------------------|--------|--------|--------|----------------------------------|--------|--------|
| Options      outstanding, beginning            |   |   | 267,038                          |   |   |   | 284,106                          |   |   |   | 347,160 |   |
| Grants                                         |   |   | -                                |   |   |   | -                                |   |   |   | - |   |
| Exercises                                      |   |   | 24,180                           |   |   |   | 17,068                           |   |   |   | 63,054 |   |
| Cancellations                                  |   |   | -                                |   |   |   | -                                |   |   |   | - |   |
| Options      outstanding, ending               |   |   | 242,858                          |   |   |   | 267,038                          |   |   |   | 284,106 |   |
|                                           |   |   |                             |   |   |   |                             |   |   |   |   |   |
| Options      price range at January 31         |   |   | $4.1133                          |   |   |   | $4.1133                          |   |   |   | $4.1133 |   |
|                                           |   |   | to      |   |   |   | to      |   |   |   | to      |   |
|                                           |   |   | $9.6440                          |   |   |   | $9.6440                          |   |   |   | $9.6440 |   |
|                                           |   |   |                             |   |   |   |                             |   |   |   |   |   |
| Options      exercisable at January 31         |   |   | 242,858                          |   |   |   | 267,038                          |   |   |   | 284,106 |   |
| Options      available for grant at January 31 |   |   | 0                                |   |   |   | 0                                |   |   |   | 0 |   |

| 2001      Plan                                 |   | 2008   |                             |   | 2007   |   |                             | 2006   |   |
|------------------------------------------------|--------|--------|----------------------------------|--------|--------|--------|----------------------------------|--------|--------|
| Options      outstanding, beginning            |   |   | 784,703                          |   |   |   | 796,904                          |   |   |   | 354,852 |   |
| Grants                                         |   |   | 14,711                           |   |   |   | 14,465                           |   |   |   | 459,120 |   |
| Exercises                                      |   |   | 112,397                          |   |   |   | 7,110                            |   |   |   | 6,636 |   |
| Cancellations                                  |   |   | 4,044                            |   |   |   | 19,556                           |   |   |   | 10,432 |   |
| Options      outstanding, ending               |   |   | 682,973                          |   |   |   | 784,703                          |   |   |   | 796,904 |   |
|                                           |   |   |                             |   |   |   |                             |   |   |   |   |   |
| Options      price range at January 31         |   |   | $5.5181                          |   |   |   | $5.5181                          |   |   |   | $5.5181 |   |
|                                           |   |   | to      |   |   |   | to      |   |   |   | to      |   |
|                                           |   |   | $10.8975                         |   |   |   | $10.8975                         |   |   |   | $9.6440 |   |
|                                           |   |   |                             |   |   |   |                             |   |   |   |   |   |
| Options      exercisable at January 31         |   |   | 659,372                          |   |   |   | 695,101                          |   |   |   | 566,060 |   |
| Options      available for grant at January 31 |   |   | 0                                |   |   |   | 10,667                           |   |   |   | 5,576 |   |

| 2005      Plan                                 |   | 2008   |                             |   | 2007   |   |     | 2006   |   |
|------------------------------------------------|--------|--------|----------------------------------|--------|--------|--------|----------|--------|--------|
| Options      outstanding, beginning            |   |   | 224,206                          |   |   |   | -        |   |   |   | - |   |
| Grants                                         |   |   | 201,089                          |   |   |   | 224,206  |   |   |   | - |   |
| Exercises                                      |   |   | -                                |   |   |   | -        |   |   |   | - |   |
| Cancellations                                  |   |   | 12,845                           |   |   |   | -        |   |   |   | - |   |
| Options      outstanding, ending               |   |   | 412,450                          |   |   |   | 224,206  |   |   |   | - |   |
|                                           |   |   |                             |   |   |   |     |   |   |   |   |   |
| Options      price at January 31               |   |   | $10.8975                         |   |   |   | $10.8975 |   |   |   |   |   |
|                                           |   |   | to      |   |   |   |     |   |   |   |   |   |
|                                           |   |   | $11.7500                         |   |   |   |     |   |   |   |   |   |
|                                           |   |   |                             |   |   |   |     |   |   |   |   |   |
| Options      exercisable at January 31         |   |   | 70,014                           |   |   |   | -        |   |   |   | - |   |
| Options      available for grant at January 31 |   |   | 476,438                          |   |   |   | 664,682  |   |   |   | 888,888 |   |

----

Index

|                                |   |   |              2008 |   |   |   |               2007 |   |   |   |               2006 |   |
|-------------------------------------|--------|--------|-------------------------------------------------|--------|--------|--------|-------------------------------------------------------|--------|--------|--------|------------------------------------------------------------|--------|
| Options      outstanding, beginning |   |   | $8.0169                                         |   |   |   | $7.0785                                               |   |   |   | $6.5246                                                    |   |
| Grants                              |   |   | $11.7500                                        |   |   |   | $10.8975                                              |   |   |   | $8.2377                                                    |   |
| Exercises                           |   |   | $7.9210                                         |   |   |   | $6.0870                                               |   |   |   | $4.6533                                                    |   |
| Cancellations                       |   |   | $10.5059                                        |   |   |   | $8.9925                                               |   |   |   | $8.3310                                                    |   |
| Options      outstanding, ending    |   |   | $8.5972                                         |   |   |   | $8.0169                                               |   |   |   | $7.0785                                                    |   |

| NOTE      12: | OTHER      INCOME, NET |
|---------------|------------------------|

|                                      |   | 2008   |     |   | 2007   |   |     | 2006   |   |
|-------------------------------------------|--------|------------------|----------|--------|------------------|--------|----------|------------------|--------|
| Interest      income                      |   |             | $958,067 |   |             |   | $962,296 |             |   |   | $602,282 |   |
| Other      miscellaneous income/(expense) |   |             | 10,648   |   |             |   | (29,706  | )                |   |   | 26,753 |   |
|                                      |   |             | $968,715 |   |             |   | $932,590 |             |   |   | $629,035 |   |

| NOTE      13: | BUSINESS      SEGMENT DATA |
|---------------|----------------------------|

----

Index

| NOTE      14: | GEOGRAPHIC      INFORMATION |
|---------------|-----------------------------|

|                         |   | 2008   |         |   | 2007   |   |        | 2006   |   |
|------------------------------|--------|--------|--------------|--------|--------|--------|-------------|--------|--------|
| Net      sales:              |   |   |         |   |   |   |        |   |   |
| United      States           |   |   | $76,659,806  |   |   |   | $70,954,129 |   |   |   | $66,403,008 |   |
| Foreign                      |   |   | 30,208,043   |   |   |   | 22,551,375  |   |   |   | 21,284,045 |   |
|                         |   |   | $106,867,849 |   |   |   | $93,505,504 |   |   |   | $87,687,053 |   |
|                         |   |   |         |   |   |   |        |   |   |   |   |   |
| Income      from operations: |   |   |         |   |   |   |        |   |   |   |   |   |
| United      States           |   |   | $13,518,133  |   |   |   | $7,628,754  |   |   |   | $7,112,573 |   |
| Foreign                      |   |   | 4,079,358    |   |   |   | 2,128,321   |   |   |   | 2,550,031 |   |
|                         |   |   | $17,597,491  |   |   |   | $9,757,075  |   |   |   | $9,662,604 |   |
|                         |   |   |         |   |   |   |        |   |   |   |   |   |
| Total      assets:           |   |   |         |   |   |   |        |   |   |   |   |   |
| United      States           |   |   | $98,104,273  |   |   |   | $86,820,188 |   |   |   | $79,295,147 |   |
| Foreign                      |   |   | 11,306,630   |   |   |   | 9,921,469   |   |   |   | 9,776,244 |   |
|                         |   |   | $109,410,903 |   |   |   | $96,741,657 |   |   |   | $89,071,391 |   |

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Index

| NOTE      15: | CONTINGENCIES |
|---------------|---------------|

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Index

QUARTERLY FINANCIAL DATA (Unaudited)

| 2008 |   | Net Sales (a) |   |   | Gross Profit |        (a) |   | Net Income |   |   | EarningsPer Share,Basic (b) |   |   | EarningsPer Share,Diluted (b) |   |
|------|--------|-------------------------|--------|--------|-------------------|-----------------|--------|-----------------|--------|--------|---------------------------------------|--------|--------|-----------------------------------------|--------|

| First      Quarter  |   |   | $21,373,563 |   |   |   | $7,158,505 |   |   |   | $3,721,751 |   |   |   | $.25   |   |   |   | $.24   |   |
|---------------------|--------|--------|-------------|--------|--------|--------|------------|--------|--------|--------|------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Second      Quarter |   |   | 26,102,277  |   |   |   | 8,935,050  |   |   |   | 1,927,268  |   |   |   | .13    |   |   |   | .13    |   |
| Third      Quarter  |   |   | 30,140,427  |   |   |   | 10,169,258 |   |   |   | 3,066,852  |   |   |   | .20    |   |   |   | .20    |   |
| Fourth      Quarter |   |   | 29,251,582  |   |   |   | 10,109,555 |   |   |   | 3,190,294  |   |   |   | .21    |   |   |   | .21    |   |
|                |   |   |        |   |   |   |       |   |   |   |       |   |   |   |   |   |   |   |   |   |

| 2007 |   | Net Sales (a) |   |   | Gross Profit |        (a) |   | Net Income |   |   | EarningsPer Share,Basic (b) |   |   | EarningsPer Share,Diluted (b) |   |
|------|--------|-------------------------|--------|--------|-------------------|-----------------|--------|-----------------|--------|--------|---------------------------------------|--------|--------|-----------------------------------------|--------|

| First      Quarter  |   |   | $20,320,308 |   |   |   | $6,205,975 |   |   |   | $1,207,448 |   |   |   | $.08 |   |   |   | $.08 |   |
|---------------------|--------|--------|-------------|--------|--------|--------|------------|--------|--------|--------|------------|--------|--------|--------|------|--------|--------|--------|------|--------|
| Second      Quarter |   |   | 24,609,500  |   |   |   | 7,229,392  |   |   |   | 1,808,685  |   |   |   | .12  |   |   |   | .12  |   |
| Third      Quarter  |   |   | 25,873,604  |   |   |   | 8,779,829  |   |   |   | 2,066,466  |   |   |   | .14  |   |   |   | .14  |   |
| Fourth      Quarter |   |   | 22,702,092  |   |   |   | 7,830,312  |   |   |   | 1,844,205  |   |   |   | .12  |   |   |   | .12  |   |

|  | (a) | The      Company reclassified the freight out, and representative and distributor      commissions from a deduction from gross sales to the cost of goods sold      and selling expense categories, respectively, for the fiscal quarters      ended January 31, 2008 and 2007. |
|--|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  | (b) | All      references to per share amounts, average common shares and shares      outstanding have been restated to reflect the effect of the four-for-three      stock split effective November 14,2007. |
|--|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | · | We have enhanced our contract review      process including the implementation of various additional controls and      procedures intended to better assure us that the terms and conditions of      customer purchase orders are accurately entered and that orders are on      terms acceptable to management and otherwise consistent with our      policies. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | We have enhanced our procedures and      controls with respect to customer credit, including establishing initial      credit, further extension of credit and improved controls over credit      delinquencies; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | We have enhanced the segregation of      duties with respect to order entry, shipping, invoicing, accounts      receivable and collections, modified certain practices with respect to      access to data in certain of these areas, and made other process changes      in certain of these areas;and |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | We have enhanced our production      processes including the implementation of various additional controls and      procedures intended to better assure us that the information with respect      to the status of projects and orders is accurate and that projects and      orders are deemed complete in accordance with our revenue recognition      policies. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| (a)    | Exhibits      and Financial Statements and Schedules: |
|--------|-------------------------------------------------------|
|   |                                                  |   |
|   | (1)                                                   | Financial      Statements and Schedules: |
|   |                                                  |   |
|   |                                                  | Financial      statements filed as part of this report are listed in the Index to      Consolidated Financial Statements and Supplementary Data that appears on      page 28 of this report. |
|   |                                                  |   |
|   | (2)                                                   | Exhibits,      including those incorporated byreference: |

| Exhibit No. |    | Description |
|------------------|---------|-------------|
|             |    |        |   |
|             | (2)(c)  |        | Agreement      and Plan of Merger dated July 31, 2003 by and between Met-Pro Corporation,      a Delaware corporation, and Met-Pro Pennsylvania, Inc., a Pennsylvania      corporation, incorporated by reference to the Company’s Current Report on      Form 8-K filed on August 6, 2003. |
|             |    |        |   |
|             | (3)(f)  |        | Articles      of Incorporation of Met-Pro Corporation, a Pennsylvania corporation      formerly known as Met-Pro Pennsylvania, Inc., incorporated by reference to      the Company’s Current Report of Form 8-K filed on August 6,      2003. |
|             |    |        |   |
|             | (3)(g)  |        | By-Laws      of Met-Pro Corporation, a Pennsylvania corporation formerly known as      Met-Pro Pennsylvania, Inc., incorporated by reference to the Company’s      Current Report on Form 8-K filed on August 6, 2003. |
|             |    |        |   |
|             | (4)     |        | Shareholders’      Rights Plan, incorporated by reference to the Company’s Current Report on      Form 8-K filed on January 6, 2000. |
|             |    |        |   |
|             | (10)(b) |        | The      1997 Stock Option Plan, incorporated by reference to the Company’s      Registration Statement on Form S-8 filed January 16,  1998.* |
|             |    |        |   |
|             | (10)(d) |        | Amendment      No. 1 to the 1997 Stock Option Plan, incorporated by reference to the      Company’s Annual Report on Form 10-K filed on May 4,  2001.* |
|             |    |        |   |
|             | (10)(f) |        | Key      Employee Severance Agreement between Met-Pro Corporation and Gary J.      Morgan, incorporated by reference to the Company’s Annual Report on Form      10-K filed on May 4, 2001.* |
|             |    |        |   |
|             | (10)(g) |        | Key      Employee Severance Agreement between Met-Pro Corporation and Raymond J. De      Hont, incorporated by reference to the  Company’s Annual Report      on Form 10-K filed on May 4, 2001.* |
|             |    |        |   |
|             | (10)(i) |        | Amendment      to Key Employee Severance Agreement between Met-Pro Corporation and Gary      J. Morgan, incorporated by reference to the Company’s Annual Report on      Form 10-K filed on May 4, 2001.* |
|             |    |        |   |
|             | (10)(j) |        | The      Company’s Director’s Retirement Plan, incorporated by reference to the      Company’s Annual Report on Form 10-K filed on May 4,  2001.* |
|             |    |        |   |
|             | (10)(k) |        | Amendment      No. 1 to the Company’s Director’s Retirement Plan, incorporated by      reference to the Company’s Annual Report on Form 10-K filed on May 4,      2001.* |

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Index

| Exhibit No. |     | Description |
|------------------|----------|-------------|
|             |     |        |   |
|             | (10)(l)  |        | Amendment      No. 2 to the Company’s Director’s Retirement Plan, incorporated by      reference to the Company’s Annual Report on Form 10-K filed on May 4,      2001.* |
|             |     |        |   |
|             | (10)(m)  |        | Restoration      Plan, effective February 1, 2000, incorporated by reference to the      Company’s Annual Report on Form 10-K filed on May 4,  2001.* |
|             |     |        |   |
|             | (10)(n)  |        | Amendment      No. 1 to the Company’s Restoration Plan, incorporated by reference to the      Company’s Annual Report on Form 10-K filed on May 4,  2001.* |
|             |     |        |   |
|             | (10)(o)  |        | Additional      1% Supplemental Executive Retirement Plan, effective February 1, 2000,      incorporated by reference to the Company’s Annual Report on Form 10-K      filed on May 4, 2001.* |
|             |     |        |   |
|             | (10)(p)  |        | The      2001 Equity Incentive Plan, incorporated by reference to the Company’s      Registration Statement on Form S-8 filed August 22,  2001.* |
|             |     |        |   |
|             | (10)(q)  |        | Year      2000 Employee Stock Purchase Plan, incorporated by reference to the      Company’s Registration Statement on Form S-8 filed on June 13,      2000.* |
|             |     |        |   |
|             | (10)(r)  |        | Salaried      Pension Plan Amended and Restated effective September 1, 2000,      incorporated by reference to the Company’s Annual Report on Form 10-K      filed on April 28, 2003.* |
|             |     |        |   |
|             | (10)(s)  |        | First      Amendment to the Company’s Salaried Pension Plan dated August 15, 2002,      incorporated by reference to the Company’s Annual Report on Form 10-K      filed on April 28, 2003.* |
|             |     |        |   |
|             | (10)(t)  |        | Second      Amendment to the Company’s Salaried Pension Plan dated October 23, 2002,      incorporated by reference to the Company’s Annual Report on Form 10-K      filed on April 28, 2003.* |
|             |     |        |   |
|             | (10)(u)  |        | Amendment      No. 3 to the Company’s Directors’ Retirement Plan dated as of February 24,      2003, incorporated by reference to the Company’s Annual Report on Form      10-K filed on April 28, 2003.* |
|             |     |        |   |
|             | (10)(v)  |        | Amendment      No. 1 to the Company’s Additional 1% Supplemental Executive Plan dated as      of March 21, 2003, incorporated by reference to the Company’s Annual      Report on Form 10-K filed on April 28, 2003.* |
|             |     |        |   |
|             | (10)(w)  |        | Directors      Retirement Plan Trust dated as of February 11, 2000, incorporated by      reference to the Company’s Annual Report on Form 10-K filed on April 28,      2003.* |
|             |     |        |   |
|             | (10)(x)  |        | Amendment      No. 1 to the Company’s Directors’ Retirement Plan Trust dated as of      February 24, 2003, incorporated by reference to the Company’s Annual      Report on Form 10-K filed on April 28, 2003.* |
|             |     |        |   |
|             | (10)(y)  |        | Amendment      No. 2 to the Company’s Directors’ Retirement Plan Trust dated as of      February 24, 2003, incorporated by reference to the Company’s Annual      Report on Form 10-K filed on April 28, 2003.* |
|             |     |        |   |
|             | (10)(z)  |        | Restoration      and Supplemental Executive Retirement Plan Trust Agreement dated as of      February 11, 2000, incorporated by reference to the Company’s Annual      Report on Form 10-K filed on April 28, 2003.* |
|             |     |        |   |
|             | (10)(aa) |        | Amendment      No. 1 to the Company’s Restoration and Supplemental Executive Retirement      Plan Trust Agreement dated as of February 24, 2003, incorporated by      reference to the Company’s Annual Report on Form 10-K filed on April 28,      2003.* |
|             |     |        |   |
|             | (10)(ab) |        | The      2005 Equity Incentive Plan, incorporated by reference to the Company’s      Registration Statement on Form S-8 filed June 9, 2005.* |
|             |     |        |   |
|             | (10)(ac) |        | Third      Amendment to the Company’s Salaried Pension Plan dated as of August 31,      2005, incorporated by reference to the Company’s Annual Report on Form      10-K filed on April 13, 2007. * |
|             |     |        |   |
|             | (10)(ad) |        | Fourth      Amendment to the Company’s Salaried Pension Plan dated as of April 5,      2006, incorporated by reference to the Company’s Annual Report on Form      10-K filed on April 13, 2007. * |

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Index

| Exhibit No. |     | Description |
|------------------|----------|-------------|
|             |     |        |   |
|             | (10)(ae) |        | Fifth      Amendment to the Company’s Salaried Pension Plan dated as of October 18,      2006, incorporated by reference to the Company’s Annual Report on Form      10-K filed on April 13, 2007. * |
|             |     |        |   |
|             | (10)(af) |        | Standard form for the Company’s Non-Employee Director      Stock Option Agreement dated as of December 10, 2007.    ** |
|             |     |        |   |
|             | (10)(ag) |        | Standard form for the Company’s Incentive Stock Option      Agreement dated as of December 10, 2007. ** |
|             |     |        |   |
|             | (10)(ah) |        | Non-Qualified Defined Contribution Supplemental      Executive Retirement Plan Agreement dated as of May 1, 2008.      ** |
|             |     |        |   |
|             | (10)(ai) |        | Amended and Restated Key Severance Agreement for the      Chief Executive Officer dated as of April 3, 2008.  ** |
|             |     |        |   |
|             | (10)(aj) |        | Amended and Restated Key Severance Agreement for the      Chief Financial Officer dated as of April 3, 2008.  ** |
|             |     |        |   |
|             | (11)     |        | Statement      Re-computation of Per Share Earnings. See page 32 of Item    8. |
|             |     |        |   |
|             | (21)     |        | List      of Subsidiaries of Registrant as of January 31,  2008: |

| Corporate                                    |   | Jurisdiction      of            |   | Name      under which Business                                           |
|----------------------------------------------|--------|---------------------------------|--------|--------------------------------------------------------------------------|
| Name                                         |   | Incorporation                   |   | is      Conducted                                                        |
|                                         |   |                            |   |                                                                     |
| Mefiag      B.V.                             |   | The      Netherlands            |   | Mefiag      B.V., a wholly owned                                         |
|                                         |   |                            |   | Subsidiary      of Met-Pro Corporation                                   |
|                                         |   |                            |   |                                                                     |
| Flex-Kleen      Canada, Inc.                 |   | Ontario,      Canada            |   | Flex-Kleen      Canada, Inc.,                                            |
|                                         |   |                            |   | a      wholly-owned subsidiary of                                        |
|                                         |   |                            |   | Met-Pro      Corporation                                                 |
|                                         |   |                            |   |                                                                     |
| Strobic      Air Corporation                 |   | Delaware                        |   | Strobic      Air Corporation,                                            |
|                                         |   |                            |   | a      wholly-owned subsidiary of                                        |
|                                         |   |                            |   | Met-Pro      Corporation                                                 |
|                                         |   |                            |   |                                                                     |
| MPC      Inc.                                |   | Delaware                        |   | MPC      Inc.,                                                           |
|                                         |   |                            |   | a      wholly-owned subsidiary of                                        |
|                                         |   |                            |   | Met-Pro      Corporation                                                 |
|                                         |   |                            |   |                                                                     |
| Pristine      Water Solutions Inc.           |   | Delaware                        |   | Pristine      Water Solutions Inc.,                                      |
|                                         |   |                            |   | a      wholly-owned subsidiary of                                        |
|                                         |   |                            |   | Met-Pro      Corporation                                                 |
|                                         |   |                            |   |                                                                     |
| Mefiag      (Guangzhou) Filter               |   | People’s      Republic of |   | Mefiag      (Guangzhou) Filter Systems Ltd.,                             |
|    Systems      Ltd.          |   |     China   |   | a      wholly-owned subsidiary of Met-Pro (Hong Kong) Company    Limited |
|                                         |   |                            |   |                                                                     |
| Met-Pro      (Hong Kong)                     |   | Hong      Kong                  |   | Met-Pro      (Hong Kong) Company                                         |
|    Company  Limited |   |                            |   | Limited,      a wholly-owned subsidiary                                  |
|                                         |   |                            |   | of      Met-Pro Corporation                                              |

|   | (23)   |   | Consent      of Independent Registered Public Accounting Firm **                                            |
|--------|--------|--------|-------------------------------------------------------------------------------------------------------------|
|   |   |   |                                                                                                        |
|   | (31.1) |   | Certification of Chief Executive Officer pursuant to      Section 302 of the Sarbanes-Oxley Act of 2002 **  |
|   |   |   |                                                                                                        |
|   | (31.2) |   | Certification of Chief Financial Officer pursuant to      Section 302 of the Sarbanes-Oxley Act of 2002  ** |

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Index

| Exhibit No. |   | Description |
|------------------|--------|-------------|
|             |   |        |   |
|             | (32.1) |        | Certification of Chief Executive Officer pursuant to 18      U.S.C. Section 1350, as Adopted pursuant to Section 906 of the      Sarbanes-Oxley Act of 2002 ** |
|             |   |        |   |
|             | (32.2) |        | Certification of Chief Financial Officer pursuant to 18      U.S.C. Section 1350, as Adopted pursuant to Section 906 of the      Sarbanes-Oxley Act of 2002 ** |

|        | The following exhibits required under Item 601 of      Regulation S-K promulgated by the Securities & Exchange Commission      have been omitted because they are either posted on our |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | website,      inapplicable or non-existent:                                                                                                                                                |

| (9)  |   | Voting      trust agreements.                                                       |
|------|--------|-------------------------------------------------------------------------------------|
| (12) |   | Statements      re computation of ratios.                                           |
| (13) |   | Annual      report to security holders.                                             |
| (14) |   | Code      of ethics.                                                                |
| (16) |   | Letter      re change in certifying accountant.                                     |
| (18) |   | Letter      re change in accounting principles.                                     |
| (22) |   | Published      report regarding matters submitted to vote of security      holders. |
| (24) |   | Power      of attorney.                                                             |

|        | *  Indicates management contract or compensatory      plan or arrangement. |   |   |
|--------|--------------------------------------------------------------------------------------|--------|--------|
|   | **Filed      herewith.                                                               |   |   |

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Index

IG

|                |   | MET-PRO      CORPORATION             |
|---------------------|--------|--------------------------------------|
|                |   |                                 |
| April      11, 2008 |   | By: /s/      Raymond J. De Hont      |
| Date                |   |  Raymond      J. De Hont        |
|                |   |  Chairman,      Chief Executive |
|                |   |  Officer      and President     |

| Signature                         | Title                               | Date                |
|-----------------------------------|-------------------------------------|---------------------|
|                              |                                |                |
| /s/      Raymond J. De Hont       | Chairman,                           | April      11, 2008 |
| Raymond      J. De Hont           | Chief      Executive Officer        |                |
|                              | and      President                  |                |
|                              |                                |                |
|                              |                                |                |
| /s/ Gary      J. Morgan           | Senior      Vice President-Finance, | April      11, 2008 |
| Gary      J. Morgan               | Secretary,      Treasurer,          |                |
|                              | Chief      Financial Officer,       |                |
|                              | Chief      Accounting Officer       |                |
|                              | and      Director                   |                |
|                              |                                |                |
| /s/      Nicholas DeBenedictis    | Director                            | April      11, 2008 |
| Nicholas      DeBenedictis        |                                |                |
|                              |                                |                |
| /s/      George H. Glatfelter II  | Director                            | April      11, 2008 |
| George      H. Glatfelter II      |                                |                |
|                              |                                |                |
| /s/ Alan      Lawley              | Director                            | April      11, 2008 |
| Alan      Lawley                  |                                |                |
|                              |                                |                |
| /s/      Michael J. Morris        | Director                            | April      11, 2008 |
| Michael      J. Morris            |                                |                |
|                              |                                |                |
| /s/      Constantine N. Papadakis | Director                            | April      11, 2008 |
| Constantine      N. Papadakis     |                                |                |

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