<PAGE>

                                UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549

                                  FORM 10-Q
                                  ---------

(X)  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE SECURITIES
     EXCHANGE ACT OF 1934

      For the quarterly period ended:  DECEMBER 27, 1997

                                      OR

 ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
     EXCHANGE ACT OF 1934

       For the transition period from _________ to __________
                                          
Commission file number: 333-32207
                                          
                                          
                                          
                                HCC INDUSTRIES INC.
               (Exact name of Registrant as specified in its charter)
                                          
                                          
             DELAWARE                                   95-2691666
             --------                                   ----------
     (State or other jurisdiction of                 (I.R.S. Employer
     incorporation or organization)                 Identification No.) 


             4232 TEMPLE CITY BLVD., ROSEMEAD, CALIFORNIA  91770
             ---------------------------------------------------
                   (Address of principal executive offices)
                                          
                                          
                                (626) 443-8933
                        -------------------------------
               (Registrant's telephone number, including area code)
                                          
                                ___________________
                                          
Indicate by check mark whether the registrant:  (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.   Yes ( X )   No (   )
                                          
                                          
  Registrant's Common Stock, outstanding at February 9, 1998 was 134,955 shares.


<PAGE>

PART I - FINANCIAL INFORMATION
ITEM 1.   CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


                     HCC INDUSTRIES INC. AND SUBSIDIARIES
                     CONDENSED CONSOLIDATED BALANCE SHEETS
                       (IN THOUSANDS, EXCEPT SHARE DATA)

                                    ASSETS
<TABLE>
<CAPTION>
                                                            DECEMBER 27,   MARCH 29,
                                                                1997          1997
                                                            ------------   ---------
<S>                                                           <C>           <C>
CURRENT ASSETS:
    Cash and cash equivalents                                 $ 9,265       $  6,841
    Restricted cash                                               ---         69,282
    Trade accounts receivable, less allowance for
      doubtful accounts of $67 at December 27, 1997
      and $40 at March 29, 1997                                 7,891          6,904
    Inventories                                                 4,523          4,376
    Prepaid and deferred income taxes                           1,065            756
                                                               ------         ------
          Total current assets                                 22,744         88,159

PROPERTY, PLANT AND EQUIPMENT, NET                             13,538         12,264

OTHER ASSETS:
    Intangible assets                                           5,715          4,507
    Deferred financing costs, net                               3,548          1,903
    Deferred income taxes                                       3,269          3,269
    Restricted cash                                             5,964          6,039

          TOTAL ASSETS                                        $54,778       $116,141
                                                              -------       --------
                                                              -------       --------

                LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES:
    Current portion of long-term debt                         $   726       $  3,537
    Accounts payable                                            2,699          2,553
    Accrued liabilities                                         5,759          5,193
    Due to stockholders                                           ---         69,282
                                                               ------         ------

          Total current liabilities                             9,184         80,565

LONG TERM LIABILITIES:
    Long-term debt, net of current portion                     92,129         78,916
    Other long-term liabilities                                 9,604         10,000
                                                              -------         ------
                                                              110,917        169,481
                                                              -------        -------
                                                              -------        -------
COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY (DEFICIT):
    Common stock; $.10 par value; authorized 550,000
      shares, issued and outstanding 134,955 shares at 
      December 27, 1997 and 143,569 shares at March 29, 1997       13             14
    Accumulated deficit                                       (56,152)       (53,354)
                                                             --------       --------

TOTAL STOCKHOLDERS' DEFICIT                                   (56,139)       (53,340)

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT                  $ 54,778       $116,141
                                                              --------       --------
                                                              --------       --------
</TABLE>

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


                                   2
<PAGE>

                                      HCC INDUSTRIES INC. AND SUBSIDIARIES
                                 CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
                                       (IN THOUSANDS, EXCEPT SHARE DATA)
                                                                     
<TABLE>
<CAPTION>
                                                                     
                                                                     Three Months Ended            Nine Months Ended   
                                                                 --------------------------   ---------------------------
                                                                 December 27,  December 28,   December 27,   December 28,
                                                                     1997          1996           1997           1996
                                                                 ------------  ------------   ------------   ------------
<S>                                                              <C>           <C>            <C>            <C>
NET SALES                                                        $   15,128      $  13,769     $   46,189     $   42,833

Cost of goods sold                                                    9,508          8,681         28,324         26,977
                                                                 ----------      ---------     ----------     ----------

GROSS PROFIT                                                          5,620          5,088         17,865         15,856

Selling, general and administrative expenses                          1,736          1,498          6,031          8,442
Non-recurring expense                                                 1,250         10,000          1,250         10,000
                                                                 ----------      ---------     ----------     ----------

EARNINGS (LOSS) FROM OPERATIONS                                       2,634         (6,410)        10,584         (2,586)

OTHER INCOME (EXPENSE):
  Interest and other income                                             157            104            372            338
  Interest expense                                                   (2,573)          (647)        (7,751)        (1,427)     
                                                                 ----------      ---------     ----------     ----------

            Total other expense, net                                 (2,416)          (543)        (7,379)        (1,089)

Earnings (loss) before taxes and extraordinary item                     218         (6,953)         3,205         (3,675)
Taxes (benefit) on earnings (loss)                                       99         (2,802)         1,274         (1,518)
                                                                 ----------      ---------     ----------     ----------

Earnings (loss) before extraordinary item                               119         (4,151)         1,931         (2,157)

Extraordinary loss on retirement of debt, net
  of tax benefit of $640                                                 --             --         (1,002)            --
                                                                 ----------      ---------     ----------     ----------

NET EARNINGS (LOSS)                                                 $   119     $   (4,151)       $   929     $   (2,157)
                                                                 ----------      ---------     ----------     ----------
                                                                 ----------      ---------     ----------     ----------



EARNINGS (LOSS) PER SHARE BEFORE EXTRAORDINARY LOSS                 $  0.88     $   (14.15)       $ 14.21     $    (5.60)
Extraordinary loss per share                                           0.00           0.00          (7.37)          0.00
                                                                 ----------      ---------     ----------     ----------

NET EARNINGS (LOSS) PER SHARE                                       $  0.88     $   (14.15)       $  6.84     $    (5.60)
                                                                 ----------      ---------     ----------     ----------
                                                                 ----------      ---------     ----------     ----------

Weighted average shares outstanding                                 134,955        293,266        135,912        385,088
                                                                 ----------      ---------     ----------     ----------
                                                                 ----------      ---------     ----------     ----------
</TABLE>


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


                                   3
<PAGE>
                                                                     
                                    HCC INDUSTRIES INC. AND SUBSIDIARIES
                               CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                               (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                  For the Nine Months Ended
                                                                 ---------------------------
                                                                 December 27,   December 28,
                                                                     1997            1996
                                                                 ------------   ------------
<S>                                                              <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings (loss)                                                $    929       $ (2,157)
Reconciliation of net earnings to net cash
   provided by operating activities:
     Depreciation                                                     1,058            865
     Amortization                                                       547            346
     Deferred income taxes                                             (562)        (4,000)
     Non-recurring expense                                               --         10,000
     Extraordinary loss                                               1,002             --
Changes in operating assets and liabilities:
          (Increase) in trade accounts receivable, net                 (608)          (119)
          Decrease in inventories                                       112            245
          Decrease (increase) in other assets                            86           (161)
          Increase in accrued liabilities                               170          3,780
          Increase in accounts payable and income 
               taxes payable                                            961            243
                                                                   --------       --------

          Net cash provided by operating activities                   3,695          9,042
                                                                   --------       --------

CASH FLOWS FROM INVESTING ACTIVITIES:
     Business acquisition                                            (2,200)            --
     Purchases of property, plant and equipment                      (1,145)        (1,337)
     Cash collected on note receivable                                   --             25
                                                                   --------       --------
          Net cash used in investing activities                      (3,345)        (1,312)
                                                                   --------       --------

CASH FLOWS FROM FINANCING ACTIVITIES:
     Principal payments on long-term debt                           (80,408)        (1,227)
     Proceeds from issuance of long-term debt                        90,000             --
     Deferred financing costs                                        (3,790)            --
     Repurchases of stock                                            (3,728)        (2,548)
                                                                   --------       --------

          Net cash provided by (used in) financing activities         2,074         (3,775)
                                                                   --------       --------

Net increase in cash and cash equivalents                             2,424          3,955

Cash and cash equivalents at beginning of period                      6,841          6,647
                                                                   --------       --------

CASH AND CASH EQUIVALENTS AT END OF PERIOD                        $   9,265     $   10,602
                                                                   --------       --------
                                                                   --------       --------

SUPPLEMENTAL NONCASH FINANCING ACTIVITIES:
     Capital lease obligations                                          854            612
     Note payable issued for repurchase of stock                         --         11,000

</TABLE>

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


                                   4
<PAGE>


                                       
                     HCC INDUSTRIES INC. AND SUBSIDIARIES
             Notes to Condensed Consolidated Financial Statements
                             December 27, 1997


1.   INTERIM FINANCIAL STATEMENTS:

The accompanying unaudited condensed consolidated financial statements of HCC 
Industries Inc. and Subsidiaries (the "Company"), include all adjustments 
(consisting of normal recurring entries) which management believes are 
necessary for a fair presentation of the financial position and results of 
operations for the periods presented.  Certain information and footnote 
disclosures normally included in financial statements prepared in accordance 
with generally accepted accounting principles have been condensed or omitted. 
Interim financial statements are subject to possible adjustments in 
connection with the annual audit of the Company's accounts for the full year. 
The year end condensed balance sheet data was derived from audited financial 
statements, but does not include all disclosures required by generally 
accepted accounting principles. It is suggested that the accompanying interim 
financial statements be read in conjunction with the Company's audited 
financial statements and footnotes as of and for the year ended March 29, 
1997.  Operating results for the three and nine month periods ended December 
27, 1997 are not necessarily indicative of the operating results for the full 
fiscal year.


2.   INVENTORIES:

     Inventories consist of the following (in thousands):

<TABLE>
<CAPTION>
                                                December  27,         March 29,
                                                    1997                 1997  
                                                -------------         ---------
<S>                                               <C>                  <C>
     Raw materials and component parts            $  1,997             $  1,910
     Work in process                                 2,526                2,466
                                                  --------             --------
                                                  $  4,523             $  4,376
                                                  --------             --------
                                                  --------             --------
</TABLE>

3.   PROPERTY, PLANT AND EQUIPMENT:

     Property, plant and equipment consist of the following (in thousands):

<TABLE>
<CAPTION>
                                                December  27,         March 29,
                                                    1997                 1997  
                                                -------------         ---------
<S>                                               <C>                  <C>
     Land                                         $  3,180             $  3,180
     Buildings and improvements                      5,968                5,450
     Furniture, fixtures and equipment              11,164                9,350
                                                  --------             --------

                                                    20,312               17,980
     Less accumulated depreciation                  (6,774)              (5,716)
                                                  --------             --------
                                                  $ 13,538             $ 12,264
                                                  --------             --------
                                                  --------             --------
</TABLE>


                                       5
<PAGE>

                      HCC INDUSTRIES INC. AND SUBSIDIARIES
              Notes to Condensed Consolidated Financial Statements
                               December 27, 1997

4.   BUSINESS ACQUISITION:

On June 20, 1997, the Company acquired substantially all of the assets and 
assumed certain liabilities of Connector Industries of America, a 
glass-to-metal sealing company.  The purchase price included $2,100,000 in 
cash and a contingent payment of $400,000 based upon the volume of business 
retained in the immediately subsequent 18 month period.  In its last fiscal 
year of operations, the acquired company generated sales of approximately 
$3,200,000.   The transaction was accounted for as an asset purchase.  In 
conjunction with the acquisition, the Company assigned $1,372,000 to 
intangibles which will be amortized over a 14 year period on a straight line 
basis.  If the contingent payment becomes payable, such amount will be 
recorded as additional purchase price consideration and added to intangibles. 
Pro forma results of operations are not provided as the impact on Company 
operations is not material. 

5.   LONG-TERM DEBT:

     Long-term debt consists of the following (in thousands):

<TABLE>
<CAPTION>
                                                December  27,         March 29,
                                                    1997                 1997  
                                                -------------         ---------
<S>                                               <C>                  <C>
     10 3/4% senior subordinated notes - 
     interest payable semi-annually due 
     May 15, 2007                                 $ 90,000             $    ---

     Tranche A Term Loan                               ---               30,000

     Tranche B Term Loan                               ---               30,000

     12% subordinated notes                            ---               19,352

     Term loan on land, building and 
     improvements due August 1997                      ---                  596

     Other                                           2,855                2,505
                                                  --------             --------

                                                    92,855               82,453
     Less current portion                              726                3,537
                                                  --------             --------

                                                  $ 92,129             $ 78,916
                                                  --------             --------
                                                  --------             --------
</TABLE>

In May 1997, the Company issued $90,000,000 of senior subordinated notes due 
in May 2007 ("Notes").  Interest is payable semi-annually at 10.75% per 
annum. Proceeds from the offering were used to (I) retire the Tranche A Term 
Loan, the Tranche B Term Loan and the 12% subordinated notes, and (ii) 
provide approximately $3,800,000 (net of offering expenses) for additional 
working capital needs of the Company.  As a result of this refinancing, the 
Company recorded an extraordinary loss of $1,002,000, net of taxes, in the 
first quarter of fiscal 1998.  Concurrent with the offering, the Company's 
bank increased the revolving credit facility to an aggregate of $20,000,000.

The Company's 10 3/4% Senior Subordinated Notes are guaranteed by all 
operating subsidiaries of the Company (the "Subsidiary Guarantors").  The 
guarantee obligations of the Subsidiary Guarantors (which are all direct or 
indirect wholly owned subsidiaries of the Company) are full, unconditional 
and joint and several.  The aggregate assets, liabilities, earnings, and 
equity of the Subsidiary Guarantors are substantially equivalent to the total 
assets, liabilities, earnings, and equity of HCC Industries Inc. and its 
subsidiaries on a consolidated basis.  Separate financial statements of the 
Subsidiary Guarantors are not included in the accompanying financial 
statements because management of the Company has determined that separate 
financial statements of the Subsidiary Guarantors would not be material to 
investors.


                                       6
<PAGE>

                                       
                      HCC INDUSTRIES INC. AND SUBSIDIARIES
              Notes to Condensed Consolidated Financial Statements
                               December 27, 1997


6.   COMMITMENTS AND CONTINGENCIES:

ENVIRONMENTAL

As an ongoing facet of the Company's business, it is required to maintain 
compliance with various environmental regulations.  The cost of this 
compliance is included in the Company's operating results as incurred.  These 
ongoing costs include permitting fees and expenses and specialized effluent 
control systems as well as monitoring and site assessment costs required by 
various governmental agencies.  In the opinion of management, the maintenance 
of this compliance will not have a significant effect on the financial 
position or results of operations of the Company.

In August 1994, the U.S. Environmental Protection Agency ("EPA") identified 
the Company as a potentially responsible party ("PRP") in the El Monte 
Operable Unit ("EMOU") of the San Gabriel Valley Superfund Sites.  In early 
1995, the Company and the EPA executed an Administrative Consent Order which 
requires the Company and other PRP's to perform a Remedial Investigation and 
Feasibility Study ("RI/FS") for the EMOU.  In addition, the Company's 
facility in Avon, Massachusetts is subject to Massachusetts "Chapter 21E", 
the State's hazardous site clean-up program.   Uncertainty as to (a) the 
extent to which the Company caused, if at all, the conditions being 
investigated, (b) the extent of environmental contamination and risks, (c) 
the applicability of changing and complex environmental laws (d) the number 
and financial viability of other PRP's, (e) the stage of the investigation 
and/or remediation, (f) the unpredictability of investigation and/or 
remediation costs (including as to when they will be incurred), (g) 
applicable clean-up standards, (h) the remediation (if any) that will 
ultimately be required, and (i) available technology make it difficult to 
assess the likelihood and scope of further investigation or remediation 
activities or to estimate the future costs of such activities if undertaken.  
In addition, liability under CERCLA is joint and several, and any potential 
inability of other PRPs to pay their pro rata share of the environmental 
remediation costs may result in the Company being required to bear costs in 
excess of its pro rata share.

In fiscal 1997, the Company with the help of independent consultants, 
determined a range of estimated costs of $9,000,000 to $11,000,000 associated 
with the various claims and assertions it faces.  The time frame over which 
the Company expects to incur such costs varies with each site, ranging up to 
20 years as of March 29, 1997. These estimates are based partly on progress 
made in determining the magnitude of such costs, experience gained from sites 
on which remediation is ongoing or has been completed, and the timing and 
extent of remedial actions required by the applicable governmental 
authorities.  As a result, the Company has accrued $10,000,000 for estimated 
environmental remediation as of March 29, 1997 which the Company believes to 
be the best estimate of the liability.

Claims for recovery of costs already incurred and future costs have been 
asserted against various insurance companies.  The Company has neither 
recorded any asset nor reduced any liability in anticipation of recovery with 
respect to such claims made.

The Company believes its reserves are adequate, but as the scope of its 
obligations becomes more clearly defined, this reserve may be modified and 
related charges against earnings may be made.

OTHER
In addition to the above, the Company is involved in other claims and 
litigation arising in the normal course of business.  Based on the advice of 
counsel and in the opinion of management, the ultimate resolution of these 
matters will not have a significant effect on the financial position or the 
results of operations of the Company.


                                       7
<PAGE>


                      HCC INDUSTRIES INC. AND SUBSIDIARIES
              Notes to Condensed Consolidated Financial Statements
                               December 27, 1997
                                       

7.   RECENTLY ISSUED ACCOUNTING STANDARDS:

     In June 1997, the Financial Accounting Standards Board ("FASB") issued 
Statement of Financial Accounting Standards ("SFAS") No. 130, "Reporting 
Comprehensive Income".  The standard establishes guidelines for the reporting 
and display of comprehensive income and its components in financial 
statements. Disclosure of comprehensive income and its components will be 
required beginning with the Company's fiscal year ending 1999.

     Also in June 1997, the FASB issued SFAS No. 131, "Disclosures About 
Segments of an Enterprise and Related Income".  The standard requires that 
companies disclose "operating segments" based on the way management 
disaggregates the company for making internal operating decisions.  The new 
rules will be effective for the Company's 1999 fiscal year end.  The Company 
has not evaluated the impact, if any, of the new standard.


                                       8
<PAGE>

PART I - FINANCIAL INFORMATION


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


RESULTS OF OPERATIONS (IN MILLIONS)



<TABLE>
<CAPTION>

                                               For the Three Months Ended                      For the Nine Months Ended
                                       ------------------------------------------      ------------------------------------------
                                       Dec. 27,                Dec. 28,                Dec. 27,                Dec. 28,
                                         1997     Percent        1996     Percent        1997     Percent        1996     Percent
                                       -------    -------      -------    -------      -------    -------      -------    -------
<S>                                    <C>        <C>          <C>        <C>          <C>        <C>          <C>        <C>
Net sales                               $15.1      100.0%       $13.8      100.0%       $46.2      100.0%       $42.8      100.0%
Gross profit                              5.6       37.1%         5.1       37.0%        17.9       38.7%        15.8       36.9%
Selling, general and administrative
  expenses                                1.7       11.5%         1.5       10.9%         6.0       13.1%         8.4       19.6%
Non-recurring expense                     1.3        8.3%        10.0       72.6%         1.3        2.7%        10.0       23.4%
Earnings (loss) from operations           2.6       17.4%        (6.4)        N/A        10.6       22.9%        (2.6)        N/A
Other income/(expense)                   (2.4)     (16.0%)       (0.5)       3.9%        (7.4)     (16.0%)       (1.1)       2.6%
Extraordinary loss (1)                    0.0        0.0%         0.0        0.0%        (1.0)      (2.2%)        0.0        0.0%
Net earnings (loss)                      $0.1        0.1%       ($4.2)        N/A        $0.9        2.0%       ($2.2)        N/A
</TABLE>

(1) Represents extraordinary loss on retirement of debt, net of tax benefit.



COMPARISON OF THE THREE MONTHS ENDED DECEMBER 27, 1997 ("1998 QUARTER") TO THE
THREE MONTHS ENDED DECEMBER 28, 1996 ("1997 QUARTER")


NET SALES

     The Company's sales increased by approximately 9.4%, or $1.3 million to
$15.1 million for the 1998 Quarter compared to sales of $13.8 million for the
1997 Quarter.

     This increase was attributable to increasing demand in non-automotive
products. The Company experienced strong growth in its aerospace, industrial and
petrochemical products.  Net non-automotive shipments increased by approximately
17.2% in the 1998 Quarter compared to the 1997 Quarter.  Based on current order
volume, the Company expects continued growth in the aerospace, industrial and
petrochemical markets.

     On the automotive side, unit shipments of airbag initiator products
increased significantly due to increased volumes on existing programs and the
development of some new programs. This increased volume was offset by a price
reduction effected under a new three year supply agreement with the Company's
largest customer, Special Devices, Inc. ("SDI") and by the scheduled completion
of the remaining automotive sensor programs for TRW.  Overall, revenue from
automotive shipments was flat in the 1998 Quarter compared to the 1997 Quarter.
The new agreement with SDI was effective October 1, 1997 and expires on December
31, 2000.


GROSS PROFIT

     Gross profit increased by approximately 9.8% or $0.5 million, to $5.6
million for the 1998 Quarter compared to $5.1 for the 1997 Quarter.  Gross
margin increased slightly to 37.1% for the 1998 Quarter from 37.0% for the 1997
Quarter.

     The increase in gross profit is attributable to the increased sales volume.
The increase in gross margin is due to efficiencies gained through increased
operating leverage on the higher sales volume.


                                       9
<PAGE>

ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS, CONTINUED


SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

     Selling, general and administrative ("S,G&A") expenses increased by
approximately 13.3% or $0.2 million to $1.7 million for the 1998 Quarter
compared to $1.5 million for the 1997 Quarter.  S,G&A expenses as a percent to
sales increased to 11.5% in the 1998 Quarter from 10.9% for the 1997 Quarter.

     The $0.2 million increase in S,G&A expenses is primarily due to higher
selling expenses incurred in supporting the increased sales volume in the 1998
Quarter compared to the 1997 Quarter.  The increase in the percentage of S,G&A
expenses to sales reflects the overall impact of the higher S,G&A expenses as
discussed above.


NON-RECURRING EXPENSE

     For the 1998 Quarter, the non-recurring expense was attributable to a $1.3
million financing fee  paid in December 1997 to Windward Capital Partners in
connection with securing the financing for the Recapitalization of the Company
in February 1997.  For the 1997 Quarter, the $10.0 million charge represents
estimated environmental costs.  A $6.0 million escrow was established in the
1997 Quarter to fund the estimated after-tax cost (estimated tax benefit of $4.0
million) associated with these environmental matters.


EARNINGS FROM OPERATIONS

     Operating earnings increased $9.0 million to $2.6 million for the 1998
Quarter compared to a loss of $6.4 million for the 1997 Quarter.

     The increase in operating earnings and operating margin was primarily
attributable to the $8.8 million reduction in non-recurring expenses in the 1998
Quarter compared to the 1997 Quarter.


OTHER EXPENSE, NET

     Other expense, net increased $1.9 million to $2.4 million in the 1998
Quarter from $0.5 million for the 1997 Quarter.  This increase was attributable
to the increased interest expense associated with the additional debt incurred
to finance the Recapitalization in February 1997.  The Company has $92.1 million
of indebtedness as of December 27, 1997 compared to $21.7 million at December
28, 1996.


NET EARNINGS

     Net earnings increased by approximately $4.3 million to $0.1 million for
the 1998 Quarter from a loss of $4.2 million in the 1997 Quarter.

     The increase in net earnings was primarily attributable to the after tax
impact of the reduction in non-recurring expenses and partially offset by the
increase in interest expense in the 1998 Quarter.


                                       10
<PAGE>

ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS, CONTINUED


COMPARISON OF THE NINE MONTHS ENDED DECEMBER 27. 1997 ("1998 PERIOD") TO THE
NINE MONTHS ENDED DECEMBER 28, 1996 ("1997 PERIOD")

NET SALES

     The Company's sales increased by approximately 7.9%, or $3.4 million to
$46.2 million for the 1998 Period compared to sales of $42.8 million for the
1997 Period.

     This increase was attributable to increasing demand in non-automotive
products. The Company experienced strong growth in its aerospace, industrial and
petrochemical products.  Net non-automotive shipments increased by 13.5% in the
1998 Period compared to the 1997 Period.  Based on current order volume, the
Company expects continued growth in the aerospace, industrial and petrochemical
markets.

     On the automotive side, unit shipments of airbag initiator products
increased significantly due to increased volumes on existing programs and the
development of some new programs. This increased volume was offset by a
price reduction effected under a new three year supply agreement with the
Company's largest customer, Special Devices, Inc. ("SDI") and by the scheduled
completion of the remaining automotive sensor programs for TRW.  Overall,
revenue from automotive shipments was flat in the 1998 Period compared to the
1997 Period.  The new agreement with SDI was effective October 1, 1997 and
expires on December 31, 2000.


GROSS PROFIT

     Gross profit increased by approximately 13.3% or $2.1 million, to $17.9
million for the 1998 Period compared to $15.8 million for the 1997 Period.
Gross margin increased to 38.7% for the 1998 Period from 36.9% for the 1997
Period.

     The increase in gross profit is attributable to the increased sales volume.
The increase in gross margin is primarily attributable to an improved sales mix
between product lines coupled with efficiencies gained through increased
operating leverage on the higher sales volume.


SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

     Selling, general and administrative ("S,G&A") expenses decreased by
approximately 28.6% or $2.4 million to $6.0 million for the 1998 Period compared
to $8.4 million for the 1997 Period.  S,G&A expenses as a percent to sales
decreased to 13.1% in the 1998 Period from 19.6% for the 1997 Period.

     The $2.4 million decrease in S,G&A expenses reflects the elimination of
certain non-recurring compensation costs from the 1997 Period that were not
incurred in the 1998 Period.  The reduced compensation costs were partially
offset higher selling expenses incurred in supporting the increased sales
volume.  The improvement in the percentage of S,G&A expenses to sales reflects
the overall lower S,G&A expenses.


                                       11
<PAGE>

ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS, CONTINUED


NON-RECURRING EXPENSE

     For the 1998 Period, the non-recurring expense was attributable to a $1.3
million financing fee  paid in December 1997 to Windward Capital Partners in
connection with securing the financing for the Recapitalization of the Company
in February 1997.  For the 1997 Period, the $10.0 million charge represents
estimated environmental costs.  A $6.0 million escrow was established in the
1997 Quarter to fund the estimated after-tax cost (estimated tax benefit of $4.0
million) associated with these environmental matters.


EARNINGS FROM OPERATIONS

     Operating earnings increased $13.2 million to $10.6 million for the 1998
Period compared to a loss of $2.6 million for the 1997 Period.

          The increase in operating earnings and operating margin was primarily
attributable to the $8.8 million reduction in non-recurring expenses, increased
gross profit and lower S,G&A expenses (as discussed above) in the 1998 Period
compared to the 1997 Period.


OTHER EXPENSE, NET

     Other expense, net increased $6.3 million to $7.4 million in the 1998
Period from $1.1 million for the 1997 Period.  This increase was attributable to
the increased interest expense associated with the additional debt incurred to
finance the Recapitalization in February 1997.  The Company has $92.1 million of
indebtedness as of December 27, 1997 compared to $21.7 million at December 28,
1996.


NET EARNINGS

     Net earnings increased by approximately $3.1 million to $0.9 million for
the 1998 Period from a loss of $2.2 million in the 1997 Period.

     The increase in net earnings was primarily attributable to the after tax
impact of the significant reduction in non-recurring expenses and partially
offset by the increase in interest expense in the 1998 Period.


LIQUIDITY AND CAPITAL RESOURCES

     Net cash provided by operating activities was $3.7 million for the 1998
Period compared to $9.0 million for the 1997 Period.  The decrease of $5.3
million was primarily attributable to increased debt service costs and an
increase in working capital requirements.

     Net cash used in investing activities was $3.3 million for the 1998 Period
compared to $1.3 million for the 1997 Period.  The $2.0 million increase was
primarily attributable to the $2.2 million business acquisition in June 1997.


                                       12
<PAGE>

     As of December 27, 1997, the Company's outstanding indebtedness is $92.1
million, consisting of $90.0 million principal amount of the senior subordinated
notes and $2.1 million of other borrowings.  The Company amended the Revolving
Credit Facility subsequent to the Offering to augment its liquidity requirements
by increasing the size of the facility to $20.0 million.  Borrowings under the
Revolving Credit Facility may be used for general and other corporate purposes.
To date, the Company has not used any amounts under the Revolving Credit
Facility.



ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS, CONTINUED


     In August 1997, the Company established a Capital Lease Line of $3.0
million for financing manufacturing equipment expiring June 30, 1998.  The
agreement provides for thirty-six (36) or sixty (60) month terms with interest
at 2.00% above the bank's index rate.  The bank's index rate is the U.S.
Treasury Note bond-equivalent yield per annum corresponding to the average life
of the lease.  At December 27, 1997 there was $0.8 million outstanding under the
Capital Lease Line.

     Subsequent to the Offering, the Company has $90.0 million in senior
subordinated note indebtedness.  Interest expense will have a greater
proportionate impact on net income in subsequent periods in comparison with the
periods before the Recapitalization.  The Company is not subject to any
amortization requirements under the Notes prior to maturity.

     The Company believes that cash flow from operations and the availability of
borrowings under the Revolving Credit Facility and Capital Lease Line will
provide adequate funds for ongoing operations, planned capital expenditures and
debt service during the terms of such facilities.  To the extent certain
performance thresholds with respect to the Contingent Notes and Contingent
Bonuses are met, and such obligations become vested, the Company believes that
cash flow from operations and availability of borrowings will be sufficient to
fund such obligations.

     Capital expenditures for fiscal 1998 are expected to focus on vertical
integration  with investments in equipment to expand manufacturing capacity in
machining, glass production, sealing and plating, as well as automation
equipment to lower production costs on the high volume production lines.
Expected capital expenditures for fiscal 1998 are approximately $3.5 million and
will be financed through working capital and the Capital Lease Line.

     On December 8, 1997 the Company signed a new supply agreement with Special
Devices, Inc. through the year 2000.  The new agreement provides for price
concessions to SDI in consideration of a one year contract extension and
abatement of the volume discount from the previous agreement.

     This filing contains statements that are "forward looking statements", and
includes, among other things, discussions of the Company's business strategy and
expectations concerning market position, future operations, margins,
profitability, liquidity and capital resources.  Although the Company believes
that the expectations reflected in such forward looking statements are
reasonable, it can give no assurance that such expectations will prove to have
been correct.  All phases of the operations of the Company are subject to a
number of uncertainties, risks and other influences, including general economic
conditions, regulatory changes and competition, many of which are outside the
control of the Company, any one of which, or a combination of which, could
materially affect the results of the Company's operations and whether the
forward looking statements made by the Company ultimately prove to be accurate.


                                       13
<PAGE>

PART II - OTHER INFORMATION

Items 1 through 5 are omitted as they are not applicable.

Item 6.   Exhibits and Reports on Form 8-K

          (a)  Exhibits:  12 - Computation of ratio of earnings to fixed charges

          (b)  Reports on Form 8-K  -  Not applicable



                                      SIGNATURES


                                        HCC INDUSTRIES INC.


DATED:  February 9, 1998       s/s Andrew Goldfarb
        -------------------        ------------------------------------------
                                   President and Chief Executive Officer


DATED:  February 9, 1998       s/s Christopher H. Bateman
        -------------------        ------------------------------------------
                                   Vice President and Chief Financial Officer


                                         14
<PAGE>

                                 HCC INDUSTRIES INC.
                  COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
                                    (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                   For the Nine Months Ended
                                                   --------------------------
                                                   December 27,   December 28,
                                                       1997           1996
                                                   -----------    -----------
<S>                                                <C>            <C>
Earnings:

   Earnings (loss) before taxes and
     extraordinary item                             $  3,205       $ (3,675)

   Add:  Fixed Charges                                 7,751          1,427
                                                    --------       --------
                                                    $ 10,956       $ (2,248)
                                                    --------       --------
                                                    --------       --------

Fixed Charges:

   Interest expense                                 $  7,751       $  1,427
                                                    --------       --------
                                                    $  7,751       $  1,427
                                                    --------       --------
                                                    --------       --------
Ratio of Earnings to Fixed Charges                       1.4            ---(1)
                                                    --------       --------
                                                    --------       --------
</TABLE>

Note:  The ratios of earnings to fixed charges were computed by dividing
earnings by fixed charges.  For this purpose, "earnings" consist of earnings
before taxes and extraordinary item plus fixed charges and "fixed charges"
consist of interest expense and amortization of debt issuance costs.

(1)  The Company's earnings were insufficient to cover fixed charges for the
     nine months ended December 28, 1996.


                                         15