UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                           Washington, D.C. 20549
                                 FORM 10-K/A
                         Amendment No.1 to Form 10-K

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

                For the fiscal year ended September 30, 1998
                                          ------------------

                                     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:  1-4433
                                                ------

                        ARMATRON INTERNATIONAL, INC.
                        ----------------------------
           (Exact name of registrant as specified in its charter).

         Massachusetts                             04-1052250
         -------------                             ----------
(State or other jurisdiction of                (I.R.S. Employer
incorporation or organization)                 Identification No.)

      2 Main Street, Melrose MA                      02176
      -------------------------                      -----
(Address of principal executive offices)          (Zip Code)

Registrant's telephone number, including area code:  (781) 321-2300

Securities registered pursuant to Section 12(b) of the Act:  None

Securities registered pursuant to Section 12(g) of the Act:  Common Stock, 
                                                             --------------
                                                             $1 Par Value 
                                                             --------------

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 requirement for the past 90 days.  Yes  X    No    .
                                                   ---      ---

Indicate by check mark if disclosure of delinquent filers pursuant to Item 
405 of Regulation S-K is not contained herein, and will not be contained, to 
the best of registrant's knowledge, in definitive proxy or information 
statements incorporated by reference in Part III of this Form 10-K or any 
amendment to this Form 10-K.  X
                             ---

The aggregate market value of common stock held by nonaffiliates on January 
21, 1999 was $1,025,585. 

The number of shares of the Registrant's common stock outstanding on January 
21, 1999 was 2,459,749. 


The undersigned registrant hereby amends and restates its Annual Report on 
Form 10-K for the year ended September 30, 1998 including Items 1, 2, 5, 7, 
8, 10, 11, 12, 13, 14, exhibits, and other portions of as set forth on the 
pages attached hereto.

                                   PART I

Item 1. Business
----------------

(a) General Development of Business:
------------------------------------

Armatron International (the "Company") was organized in 1920 as Automatic 
Radio. Until 1978, the Company was primarily involved in the design and 
manufacture of automobile radios.

In 1978 the Company began to concentrate its efforts primarily in 
manufacturing electronic insect killing devices in the Flowtron Outdoor 
Products Division which continued until fiscal 1984.

Between 1984 and 1987 the Company acquired several companies in order to 
grow and diversify.  By the end of fiscal 1987 the Company had divested 
itself of these acquisitions.
      
In 1994 the Company's Automatic Radio Division completed field testing of 
its ultrasonic collision avoidance/obstacle detection system for automotive 
applications which is marketed under the trademark "Echovision".  Echovision 
devices monitor back blind spots and side blind spots to detect objects and 
alert operators to potential hidden hazards and features, intuitive audible 
warnings, visual warnings, automatic activation, easy installation on any 
type vehicle and a continuous system self-test.  The advantage of using 
Echovision devices include:  increased driver awareness which is expected to 
result in fewer accidents, and potentially lower damages and public 
liability costs and increased driver awareness.  The device generally sells 
in a range of $200 to $300 per system.  The Company warrants that the 
product is delivered defect free.  Production of these systems began in the 
first quarter of 1996.

The Company's main Division, Flowtron Outdoor Products, manufactures and 
distributes insect control devices including electronic bugkillers and 
biomisters, environmental products including mulching leaf-eaters and 
compost bins, and storage and handling products including plastic yard carts 
and plastic storage sheds.  All Consumer Products segment products 
distributed in fiscal 1998 are in full production.  These products undergo 
periodic model changes and product improvements.

(b) Financial Information about Industry Segments:
--------------------------------------------------

The information required by this item is set forth in Note 19 of the Notes 
to the Consolidated Financial Statements on page 29 of this Form 10-K/A.

(c) Narrative Description of Business:
--------------------------------------

The Company operates principally in two segments, the Consumer Products 
segment and the Industrial Products segment. There are no intercompany sales 
between segments.

Operations in the Consumer Products segment involve the manufacture and 
distribution of Flowtron leaf-eaters, bugkillers, yard carts, compost bins, 
biomisters, storage sheds, and doghouses which comprised 93%, 97% and 94% of 
the Company's net sales for the years ended September 30, 1998, 1997 and 
1996, respectively.  The Company distributes its consumer products primarily 
to major retailers throughout the United States, with some products 
distributed under customer labels.  Substantially all of the Company's sales 
in fiscal 1998 and accounts receivable as of September 30, 1998 related to 
business activities with such retailers.
      
For the year ended September 30, 1998, Sears, Roebuck and Co. and Home 
Depot, Inc. accounted for approximately 29% and 11% of the Company's net 
sales, respectively, and represented approximately 31% and 12% of the 
Consumer Products segment net sales, respectively.   As of September 30, 
1998, Sears, Roebuck and Co. and Home Depot, Inc. accounted for 
approximately 44% and 2%, respectively, of the Company's trade accounts 
receivable balance.

For the year ended September 30, 1997, Sears, Roebuck and Co. and Home 
Depot, Inc. accounted for approximately 32% and 10% of the Company's net 
sales, respectively, and represented approximately 34% and 10% of the 
Consumer Products segment net sales, respectively.  As of September 30, 
1997, Sears, Roebuck and Co. and Home Depot, Inc. accounted for 
approximately 53% and 4%, respectively, of the Company's trade accounts 
receivable balance.

For the year ended September 30, 1996, Sears, Roebuck and Co. accounted for 
approximately 18% of the Company's net sales, and represented approximately 
19% of the Consumer Products segment net sales.  As of September 30, 1996, 
this customer accounted for approximately 33% of the Company's trade 
accounts receivable balance.

The Industrial Products segment manufactures electronic obstacle avoidance 
systems for transportation and automotive applications and markets these 
systems under the trademark "Echovision."  The products are manufactured at 
the Company's Melrose facility using components that the Company believes 
are available from a variety of sources.  The Company's marketing strategy 
is to focus on identifying potential customers and marketing directly to 
them. 

Net sales to one customer in the Industrial Products Segment accounted for 
approximately $762,000 or 6%, of consolidated net sales in fiscal 1998 as 
compared to net sales to one customer of approximately $320,000, or 2%, of 
consolidated net sales in fiscal 1997.  Sales to this customer accounted for 
approximately 84% and 77% of the Industrial Products segment net sales for 
the years ended September 30, 1998 and 1997, respectively.  The loss of this 
customer would have a material adverse effect on the Industrial Products 
segment.

The Company began initial marketing of its collision avoidance/obstacle 
detection system in 1995.  Production began in the first quarter of 1996.

The raw materials used by the Company vary widely with many sources 
available to meet normal product requirements.  The Company had purchased 
its plastic storage sheds, yard carts, compost bins and doghouses from one 
supplier.  In July 1998, the Company transferred its production molds for its 
yard carts to another supplier and, in November 1998, the Company transferred 
its production molds for its storage sheds and compost bins to this new 
supplier.  The new supplier has begun production runs for the yard carts, 
storage sheds and compost bins and has not experienced any significant 
difficulties in meeting scheduled deliveries.  The suppliers manufacture 
these products in accordance with the Company's designs and specifications.  
The Company believes that other suppliers could provide the required 
products although comparable terms may not be realized.  A change in 
suppliers could cause a delay in scheduled deliveries of the products to the 
Company's customers and a possible loss of revenue, which would adversely 
affect the Company's results of operations.

Although the Company owns a number of design and mechanical patents in the 
U.S. and foreign countries relative to its Consumer Products Division, these 
patents are not believed to be material to the operations of the Company.  
The Company has been awarded three patents relative to the self-test 
function of its obstacle detection system.  Management believes this self-
test function will be an important feature when customers consider 
alternative obstacle detection systems.

Heavy shipments in spring and early summer of electronic insect killing 
devices, yard carts and biomisters complement Flowtron storage sheds and 
leafeaters which are shipped primarily in the late summer and fall.  The 
Company's plastic doghouses are generally sold throughout the year.

In an effort to counteract seasonal tendencies and to level production 
requirements, the Company follows the industry trade practice of offering 
its customers extended payment terms when shipments are accepted during 
certain limited periods, which results in seasonal fluctuations of working 
capital.  Sales terms for the Company's other products are 30 days, net.

The Company's largest customers are Sears, Roebuck and Co. and Home Depot, 
Inc.  Sears, Roebuck and Co. accounted for $3,736,000, $4,336,000 and 
$2,486,000, or 29%, 33% and 18% of consolidated net sales in fiscal 1998, 
1997 and 1996, respectively.  Home Depot, Inc. accounted for $1,408,000 and 
$1,244,000, or 12% and 10% of the Company's consolidated net sales in fiscal 
1998 and 1997, respectively.  The Company anticipates that sales to these 
customers will continue in fiscal 1999 at approximately the fiscal 1998 
levels.  The loss of either of these customers would have a material adverse 
effect on the Consumer Products segment and the financial operations of the 
Company.

Shipment backlog is not a significant factor in the Company's operations.

Active competition exists in all product lines in the Consumer Products 
Division, each with a number of well-established companies that manufacture 
and sell products similar to those of the Company.  Price, service, warranty 
and product performance are the bases of competition, with price becoming 
increasingly more important.  With reference to the Industrial Products 
Division, the Company expects active competition and expects price and 
product performance will be the basis of such competition.

The amount spent on Company-sponsored research and development was not 
significant in any of the three years in the period ended September 30, 
1998.

The Company's compliance with Federal, state and local environmental 
regulations had no material effect upon the expenditures, earnings or 
competitive position of the Company and its subsidiaries.

In January 1991, the California Department of Health Services issued a 
Corrective Action Order (CAO) against the Company and a former subsidiary.  
The CAO required the Company and a former subsidiary to comply with a 
Cleanup and Abatement Order that had been issued in 1990 against the Company 
for soil contamination at the site of the former subsidiary.  To date, no 
determination has been made with regard to the extent of any environmental 
damage and who may be liable.  The Company does not believe, based on the 
information available at this time, that the outcome of this matter will 
have a material adverse effect on its financial position or results of 
operations.

The number of persons employed by the Company varies from 60 to 130 due to 
the seasonal production cycle of the Company's products.  Management 
believes relations with employees are satisfactory.

(d) Financial Information about Foreign and Domestic Operations and Export 
    Sales:
    ------

The Company's export sales were not significant in any of the three years in 
the period ended September 30, 1998.

Item 2. Properties
------------------

The Company's principal executive offices and main manufacturing plant are 
leased facilities located at 2 Main Street, Melrose, Massachusetts, a Boston 
suburb.  The Company manufactures bugkillers, leafeaters and biomisters as 
well as Echovision systems at this facility.  The Company leases 84,000 
sq. ft. of this facility, which has been occupied by the Company since 1964.  
The lease for the operating facility expires in September 2000.  The Company 
believes that it will be able to negotiate an extension of its lease with 
approximately the same conditions as the current lease.

Item 3. Legal Proceedings
-------------------------

An action was filed in U.S. District Court, Central District of California 
in late 1996 relating to the foreign arbitration award described below.  The 
Company was first joined as a party by the first amended petition filed on 
March 3, 1997.  The second amended petition was filed on June 27, 1997.

The action seeks confirmation and enforcement of a foreign arbitration award 
in favor of Alsthom, currently and formerly Chantiers de L'Atlantique 
("Alsthom"), and Assurances Generales de France ("AGF") (collectively 
"Petitioners") against Respondents J.C. Carter Company, Inc. ("JCC III"), 
the Company, Armatron-JCC, Inc., formerly known as J.C. Carter Company, Inc. 
("JCC II"), a former subsidiary of the Company, and ITT Corporation and ITT 
Industries, Inc. (collectively "ITT").  The arbitration related to certain 
cryogenic cargo pumps supplied in the 1970's by the J.C. Carter Company 
Division of ITT ("JCC I") to Alsthom, which installed the pumps in two 
liquid natural gas tanker ships, the Mourad Didouche and the Ramdane Abane.  
The arbitration award was entered in favor of Alsthom and AGF, an insurer 
subrogated to the rights of Alsthom, and against "J.C. Carter Company" or 
"J.C. Carter Company, Inc." by the International Chamber of Commerce in 
Paris in 1995.  The amount of the award as to AGF is 62,431,000 French 
francs ("FF") and as to Alsthom is 5,469,000 FF (an aggregate of 
approximately $7 million U.S. dollars at September 30, 1998), both with 
interest from January 30, 1993 at the "French official rate."

Petitioners' operative pleading in the legal action, its Second Amended 
Petition, seeks confirmation of the award against JCC III and, in addition, 
seeks its confirmation and enforcement against the other Respondents, 
including the Company, on the theories of fraudulent conveyance, collateral 
estoppel and virtual representation, judicial estoppel and equitable 
estoppel, and alter ego and/or successor liability relating to events 
transpiring from 1983 through the completion of the foreign arbitration 
proceeding in 1997.  In 1983, the Company and ITT were parties to an asset 
sale transaction involving the business and assets of JCC I.  JCC II, a now 
inactive California corporation, was formed at that time for purpose of 
acquiring the assets and certain liabilities of JCC I and ceased transacting 
business after the 1987 asset sale transaction with JCC III.

The Company answered the Second Amended Petition denying any liability, 
asserting various affirmative defenses and  cross-claims against ITT for 
contractual indemnity and for equitable indemnity.  ITT and JCC III have 
cross-claimed against the Company.

At the present time the Company is unable to determine the outcome of the 
claims asserted by and against the Company in the legal action because the 
case is still at an early stage of discovery and because of the existence of 
disputed issues of fact bearing on the outcome of those claims.  However, 
there can be no assurance that the outcome to the proceedings will not have 
an adverse effect on the financial condition of the Company.

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

Not applicable.


                                   PART II

Item 5. Market for the Registrant's Common Equity and Related
-------------------------------------------------------------
        Stockholder Matters
        -------------------

The approximate number of shareholders of record at January 4, 1999 was 
1,077.

The following table indicates the fiscal quarterly high and low bid prices 
as reported in the Over the Counter Bulletin Board for the Company's common 
stock for fiscal 1998 and fiscal 1997.

<TABLE>
<CAPTION>
                                    1998                1997
Fiscal Quarter                  High    Low        High       Low

<S>                             <C>     <C>        <C>        <C>
First                           5/8     1/4          3/4      3/8
Second                          7/16    5/16       2 7/8      1/4
Third                           7/16    3/8        2 1/4      1/4
Fourth                          3/8     1/4         15/16     5/16
</TABLE>


Under its financing agreement with its commercial finance company, Congress 
Financial Corporation, the Company is restricted from paying dividends for 
the term of the agreement.  The Company currently intends to retain earnings 
rather than pay cash dividends.

Item 6. Selected Financial Data
-------------------------------

<TABLE>
<CAPTION>
                                                              Years Ended September 30,
                                                1998        1997        1996        1995        1994
                                                        (in thousands, except per share data)

<S>                                            <C>         <C>         <C>         <C>         <C>
Net Sales                                      $12,885     $13,314     $13,750     $12,017     $13,286
Operating Income (Loss)                        $    22     $  (244)    $     9     $(1,159)    $  (934)
Net Loss                                       $  (499)    $  (286)    $  (495)    $(1,557)    $(1,212)

Earnings (Loss) Per Share of Common Stock:
  Net Loss                                     $  (.20)    $  (.12)    $  (.20)    $  (.63)    $  (.49)
                                               ========================================================

Total Assets                                   $ 7,330     $ 7,264     $ 7,475     $ 7,256     $ 9,599

Long-Term Obligations                          $ 4,743     $ 4,783     $ 4,715     $ 4,715     $ 5,140
</TABLE>


There were no dividends paid on common shares during any of the above years.  
Under the financing agreement with its commercial finance company, Congress 
Financial Corporation, the Company is restricted from paying dividends for 
the term of that agreement.


Item 7. Management's Discussion and Analysis of Financial Conditions and 
-------------------------------------------------------------------------
        Results of Operations
        ---------------------

OVERVIEW

The Company operates principally in two segments, the Consumer Products 
segment and the Industrial Products segment.  Operations in the Consumer 
Products segment involve the manufacture and distribution of Flowtron leaf-
eaters, bugkillers, yard carts, compost bins, biomisters, storage sheds and 
doghouses which comprised 93% and 97% of the Company's sales during the 
years ended September 30, 1998 and 1997, respectively.  The Company 
distributes its consumer products primarily to major retailers throughout 
the United States, with some products distributed under customer labels.  
Substantially all of this segment's sales and accounts receivable related to 
business activities with such retailers.  The Industrial Products segment 
manufactures electronic obstacle avoidance systems for transportation and 
automotive applications and markets these systems under the trademark 
"Echovision".  Production of these systems began in fiscal 1996.  There are 
no intercompany sales between segments.  For the year ended September 30, 
1998, Sears Roebuck and Co. and Home Depot, Inc. accounted for approximately 
29% and 11% of the Company's net sales, respectively.  At September 30, 
1998, Sears Roebuck and Co. and Home Depot, Inc. accounted for approximately 
44% and 2%, respectively, of the Company's trade accounts receivable 
balance.  If any of the Company's major customers fail to pay the Company on 
a timely basis, it could have a material adverse effect on the Company's 
business, financial condition and results of operations. The Company had 
purchased its plastic storage sheds, yard carts, compost bins and dog houses 
from one supplier.  In July 1998, the Company transferred its production 
molds for its yard carts to another supplier and, in November 1998, the 
Company transferred its production molds for its storage sheds and compost 
bins to this new supplier.  The new supplier has begun production runs for 
the yard carts, storage sheds and compost bins and has not experienced any 
significant difficulties in meeting scheduled deliveries.  The suppliers 
manufacture these products in accordance with the Company's designs and 
specifications.  The Company believes that other suppliers could provide the 
required products although comparable terms may not be realized.  A change 
in suppliers could cause a delay in scheduled deliveries of products to the 
Company's customers and a possible loss of revenue, which would adversely 
affect the Company's results of operations.

FORWARD-LOOKING STATEMENTS

Management's discussion and analysis of the results of operations and 
financial conditions and other sections of this report contain forward-
looking statements about its prospects for the future.  Such statements are 
subject to certain risks and uncertainties, which could cause actual results 
to differ materially from those projected.  Such risks and uncertainties 
include, but are not limited to the following:

*     The Company's consumer products business is cyclical and is 
      affected by weather and some of the same economic factors that affects 
      the consumer and lawn and garden industries generally, including 
      interest rates, the availability of financing and general economic 
      conditions.  In addition, the lawn and garden products manufacturing 
      business if highly competitive.  Actions of competitors, including 
      changes in pricing, or slowing demand for lawn and garden products due 
      to general or industry economic conditions or the amount of inclement 
      weather could result in decreased demand for the Company's products, 
      lower prices received or reduced utilization of plant facilities.

*     Increased costs of raw materials can result in reduced margins, as can 
      higher transportation and shipping costs.  Historically, the Company 
      has been able to pass some of the higher raw material and 
      transportation costs through to the customer.  Should the Company be 
      unable to recover higher raw material and transportation costs from 
      price increases of its products, operating results could be adversely 
      affected.

*     If progress in manufacturing of products is slower than anticipated or 
      if demand for products produced does not meet current expectations, 
      operating results could be adversely affected.

*     If the Company is not successful in strengthening its relationship 
      with its customers, growing sales at targeted accounts, and expanding 
      geographically, operating results could be adversely affected.

*     If the Company loses any of its major customers, operating results 
      could be adversely affected.

YEAR 2000 DATE CONVERSION

The Year 2000 issue is the result of computer programs being written using 
two digits rather than four to define the applicable year.  Any of the 
Company's computer programs that have date-sensitive software may recognize 
a date using "00" as the year 1900 rather than the year 2000.  This could 
result in a system failure or miscalculations causing disruptions of 
operations, including, among other things, a temporary inability to process 
transactions, forecast production needs and the timing of raw material 
purchases, send invoices, or engage in similar normal activities.

The Company has completed the analysis and evaluation phase of it Year 2000 
project and has determined that it will be required to modify or replace 
significant portions of its hardware and software so that its computer 
systems will properly utilize dates beyond December 31, 1999.  The Company 
has also begun the process of upgrading and modernizing its major 
information systems, including its operating and financial systems.  The 
replacement systems will be Year 2000 compliant.  The Company expects to 
begin using its new systems during the second quarter of fiscal 1999.  The 
Company will utilize both internal and external resources to reprogram or 
replace, and test the software for Year 2000 modifications.  The Company 
plans to complete its Year 2000 project no later than July 31, 1999.  The 
total cost of upgrading most of the Company's major operating and financial 
systems, including the Year 2000 project, for fiscal years 1998 through 
2000, is estimated at $100,000 and is being funded through operating cash 
flows and leasing arrangements.  Of the total project cost, approximately 
$80,000 has been expended and is attributable to the purchase of new 
software and hardware.  The remaining $20,000 will be expensed as incurred.

There can be no assurance the systems of other companies on which the 
Company's systems rely will be timely converted, or that a failure to 
convert by another company, or a conversion that is incompatible with the 
Company's systems, would not have material advise effect on the Company.

The Company has been in communication with its major vendors to ensure 
compatibility of systems.  If such systems do not function properly the 
Company could experience delays in receipt of its raw materials which would 
result in delays in scheduled deliveries of shipments by the Company.

The Company expects to begin developing contingency plans to determine what 
actions the Company will take if its trading partners are not Year 2000 
compliant.  The Company expects the contingency plan to be completed by the 
end of the third quarter in fiscal 1999.

The costs of the project and the date on which the Company plans to complete 
the Year 2000 modifications are based on management's best estimates, which 
were derived utilizing numerous assumptions of future events including the 
continued availability of certain resources, third party modification plans 
and other factors.  However, there can be no assurance that these estimates 
will be achieved and actual results could differ materially from those 
plans.  Specific factors that might cause such material differences include, 
but are not limited to, the availability and cost of personnel trained in 
this area, the ability to locate and correct all relevant computer codes, 
and similar uncertainties.

LIQUIDITY AND CAPITAL RESOURCES

The Company's primary cash requirements are for operating expenses, 
including labor costs, raw material purchases and funding of accounts 
receivable.  Historically, the Company's sources of cash have been 
borrowings from banks and finance companies and notes from related parties.

During the year ended September 30, 1998, operating activities provided 
$1,715,000 in cash primarily due to a decrease in trade accounts receivable 
of $554,000 and a decrease in inventories of $623,000 as well as increases 
in accounts payable of $107,000 and interest due to related parties of 
$478,000.  The decrease in accounts receivable and inventories was primarily 
due to management's focus on cash management during fiscal 1998.

Other current liabilities increased $17,000, or 1.8%, to $925,000 at 
September 30, 1998 as compared to $908,000 at September 30, 1997.  The 
increase was primarily due to an increase of $127,000 in professional fees 
attributable to estimated legal defense costs associated with product 
liabilities, offset by a decrease of $54,000 for sales allowances and 
incentives due to the Company's decreased sales in fiscal 1998 and a 
decrease of $73,000 for various other current liabilities primarily rents 
and utilities.

The Company has a $3,500,000 revolving line of credit agreement with a 
commercial finance company.  This credit agreement is collateralized by all 
assets of the Company and expires in December 1999.  The terms of this 
agreement include a borrowing limit which fluctuates depending on the levels 
of accounts receivable and inventory which collateralize the borrowings.  
The agreement contains various covenants pertaining to maintenance of 
working capital, net worth and other conditions.  Interest on amounts 
outstanding is payable at 1 3/4% over the commercial base rate.  The 
commercial base rate was 8.5% at September 30, 1998.  At September 30, 1998, 
the Company did not have letters of credit or borrowings outstanding and 
approximately $1,168,000 was available, pursuant to the borrowing formula, 
under this credit agreement.

The Company has a $7,000,000 line of credit with a realty trust operated for 
the benefit of the Company's principal shareholders.  This line of credit, 
with interest at 10%, requires monthly payments of interest only, and is 
collateralized by all assets of the Company.  Such collateral is subordinate 
to the revolving line of credit agreement with the finance company.  In 
October 1998, the Company renewed this line of credit with the realty trust 
under the same terms and conditions and extended the maturity date to 
October 1, 1999.   Therefore this line of credit has been classified as 
long-term on the accompanying balance sheet.  The Company had $4,715,000 
outstanding under this line of credit at September 30, 1998 and 1997.   
Repayment of this line of credit is subordinate to the repayment of any and 
all balances outstanding on the revolving line of credit from the commercial 
finance company.  At September 30, 1998, interest payments of $1,395,000 
associated with this line were in arrears for the period November 1, 1995 to 
September 30, 1998.  On November 24, 1998, the Company received a waiver for 
the covenant violation as to the interest payments.  The waiver extends the 
due date as to the interest payments until September 30, 1999.

Sales terms for the Industrial Products segment are 30 days net.  Following 
industry trade practice, the Consumer Products segment offers extended 
payment terms for delivery of seasonal product items such as the bugkillers, 
electric leaf-eater, biomister, compost bin, yard carts and storage sheds, 
resulting in fluctuating requirements for working capital.

In January 1991, the California Department of Health Services issued a 
corrective action order (CAO) against the Company and a former subsidiary to 
comply with a Cleanup and Abatement order which had been issued in 1990.  
The CAO requires the Company and a former subsidiary to comply with a 
cleanup and abatement order that had been issued in 1990 against the Company 
for soil contamination at the site of the former subsidiary.  To date, no 
determination has been made with regard to the extent of any environmental 
damage and who may be liable.  The Company does not believe, based upon the 
information available at this time, that the outcome of this matter will 
have a material adverse effect on its financial position or results of 
operations.

An action was filed in U.S. District Court, Central District of California 
in late 1996 relating to the foreign arbitration award described below.  The 
Company was first joined as a party by the first amended petition filed on 
March 3, 1997.  The second amended petition was filed on June 27, 1997.

The action seeks confirmation and enforcement of a foreign arbitration award 
in favor of Alsthom, currently and formerly Chantiers de L'Atlantique 
("Alsthom"), and Assurances Generales de France ("AGF") (collectively 
"Petitioners") against Respondents J.C. Carter Company, Inc. ("JCC III"), 
the Company, Armatron-JCC, Inc., formerly known as J.C. Carter Company, Inc. 
("JCC II"), a former subsidiary of the Company, and ITT Corporation and ITT 
Industries, Inc. (collectively "ITT").  The arbitration related to certain 
cryogenic cargo pumps supplied in the 1970's by the J.C. Carter Company 
Division of ITT ("JCC I") to Alsthom, which installed the pumps in two 
liquid natural gas tanker ships, the Mourad Didouche and the Ramdane Abane.  
The arbitration award was entered in favor of Alsthom and AGF, an insurer 
subrogated to the rights of Alsthom, and against "J.C. Carter Company" or 
J.C. Carter Company, Inc." by the International Chamber of Commerce in Paris 
in 1995.  The amount of the award as to AGF is 62,431,000 French francs 
("FF") and as to Alsthom is 5,469,000 FF (an aggregate of approximately $7 
million U.S. dollars at September 30, 1998), both with interest from January 
30, 1993 at the "French official rate."

Petitioners' operative pleading in the legal action, its Second Amended 
Petition, seeks confirmation of the award against JCC III and, in addition, 
seeks its confirmation and enforcement against the other Respondents, 
including the Company, on the theories of fraudulent conveyance, collateral 
estoppel and virtual representation, judicial estoppel and equitable 
estoppel, and alter ego and/or successor liability relating to events 
transpiring from 1983 through the completion of the foreign arbitration 
proceeding in 1997.  In 1983, the Company and ITT were parties to an asset 
sale transaction involving the business and assets of JCC I.  JCC II, a now 
inactive California corporation, was formed at that time for purpose of 
acquiring the assets and certain liabilities of JCC I and ceased transacting 
business after the 1987 asset sale transaction with JCC III.

The Company answered the Second Amended Petition denying any liability, 
asserting various affirmative defenses and  cross-claims against ITT for 
contractual indemnity and for equitable indemnity.  ITT and JCC III have 
cross-claimed against the Company.

At the present time the Company is unable to determine the outcome of the 
claims asserted by and against the Company in the legal action because the 
case is still at an early stage of discovery and because of the existence of 
disputed issues of fact bearing on the outcome of those claims.  However, 
there can be no assurance that the outcome to the proceedings will not have 
an adverse effect on the financial condition of the Company.

In November 1998, the Company was advised that it had been named as a 
defendant in a lawsuit brought by a consumer of one of the Company's 
products.  The consumer claims that the product caused personal injury and 
other damages.  The Company believes that it has valid defenses.  The 
Company has insurance coverage for such claims and has accrued its insurance 
deductible amount in fiscal 1998 to cover the estimated defense costs 
associated with this matter.

During the year ended September 30, 1998, the Company made cash investments 
of $147,000 in capital expenditures primarily for tooling and dies used in 
production of bugkillers ($21,000) and Echovision products ($53,000), 
computer equipment ($42,000) and manufacturing equipment ($28,000).   As of 
September 30, 1998, the Company has commitments of approximately $20,000 for 
future capital expenditures.

The Company believes that its present working capital, credit arrangements 
with a commercial finance company and related parties, and other sources of 
financing will be sufficient to finance its seasonal borrowing needs, 
operations and investment in capital expenditures in fiscal 1999.  Other 
sources of financing, provided by the Company's principal stockholder, are 
available to finance any working capital deficiencies.

RESULTS OF OPERATIONS

Year ended September 30, 1998
-----------------------------

The results of consolidated operations for the year ended September 30, 1998 
resulted in a net loss of $499,000, or $.20 per share, as compared with net 
income of $286,000, or $.12 per share, for fiscal 1997.    

Sales decreased $429,000, or 3.2%, to $12,885,000 for the year ended 
September 30, 1998, as compared to $13,314,000 for the corresponding period 
in the previous year.  The decrease in sales was primarily attributable to a 
7.1% decrease in sales of Consumer Products offset by a 117% increase in 
sales of Industrial Products.

Operating profit is the result of deducting operating expenses excluding 
interest expense, general corporate expenses, and income taxes from total 
revenue.  

Sales and operating profit for the Consumer Products segment in the year 
ended September 30, 1998 were approximately $11,983,000 and $731,000, 
respectively, as compared to $12,898,000 and $631,000, respectively, in the 
previous year.  Sales decreased $915,000, or 7.1%, primarily due to a 
decrease in sales of bugkillers and sheds.  Product lines within the 
Consumer Products segment are subject to seasonal fluctuations, with most 
shipments occurring in the spring and summer seasons.  The Company 
anticipates that sales of the Consumer Products segment will continue at 
approximately the same levels in fiscal 1999.

Sales and operating profit for the Industrial Products segment for the year 
ended September 30, 1998 were $902,000 and $52,000, respectively, as 
compared to sales of $416,000 and operating loss of $244,000, in the 
previous year.  The increase in net sales for the Industrial Products 
segment of $486,000, or 117%, was primarily due to additional volume of 
shipments of the Company's Echovision systems to an existing customer.

Selling, general and administrative expenses decreased $74,000, or 3.0%, to 
$2,418,000 for the year ended September 30, 1998, as compared to $2,492,000 
for the year ended September 30, 1997 due to lower sales and the Company's 
cost containment efforts.  Selling, general and administrative expenses, as 
a percentage of sales, were 18.8% in fiscal 1998 as compared to 18.7% in 
fiscal 1997.

Additional tax benefits from losses on operations for the year ended 
September 30, 1998 were offset by changes to the related valuation 
allowance.

Year ended September 30, 1997
-----------------------------

The results of consolidated operations for the year ended September 30, 1997 
resulted in a net loss of $286,000, or $.12 per share, as compared to a net 
loss of $495,000, or $.20 per share for fiscal 1996.  Sales decreased 
$436,000, or 3.2%, to $13,314,000 for the year ended September 30, 1997, as 
compared to sales of $13,750,000 for the year ended September 30, 1996.  The 
decrease in sales was primarily due to a decrease in sales volume of the 
Industrial Products segment. 

Sales and operating profit for the Consumer Products segment for the year 
ended September 30, 1997 were approximately $12,898,000, and $631,000, 
respectively, as compared to sales of $12,910,000 and operating profit of 
$750,000 for the year ended September 30, 1996.  The decrease in operating 
profit was primarily due to the underutilization of this segment's 
facilities due to the decrease in sales of bugkillers.

Sales for the Industrial Products segment during the year ended September 
30, 1997 were $416,000 and its operating loss was $244,000 for the year 
ended September 30, 1997, as compared to sales of $840,000 and operating 
profit of $29,000 for the year ended September 30, 1996.  The decrease in 
sales was primarily due to a customer delaying shipments of the Company's 
obstacle avoidance systems while the customer tested and evaluated the 
Company's systems for a period of six months.  This customer, a major 
express courier and delivery service company, completed its testing in July 
1997 and has determined that the Company's obstacle avoidance systems will 
be placed on each of its newly acquired pick-up and delivery walk-in 
vehicles as they are placed in service.  The decrease in operating profit 
was primarily due to the decreased sales and the underutilization of this 
segment's facilities. 

Selling, general and administrative expenses decreased $133,000, or 5.1%, to 
$2,492,000 for the year ended September 30, 1997 as compared to $2,625,000 
for the year ended September 30, 1996.  As a percentage of sales, selling, 
general and administrative expenses were 18.7% in fiscal 1997 as compared to 
19.1% in fiscal 1996.  This decrease was due to the Company's continuing 
efforts to contain costs.

In fiscal 1989 the Company sold one of its wholly owned subsidiaries and 
pursuant to the sales agreement, the Company would receive an additional 
payment of $450,000 if this subsidiary was subsequently resold.  In the 
fourth quarter of fiscal 1997, the former subsidiary was resold and the 
Company received $450,000 in cash and recognized this gain as an unusual 
item.

Additional tax benefits from the losses on operations for the year ended 
September 30, 1997 were offset by changes to the related valuation 
allowance.

The Company believes inflation did not have a material effect on its results 
of operations for fiscal 1998, 1997 or 1996.


Item 7A. Quantitative and Qualitative Disclosures About Market Risk
-------------------------------------------------------------------

The Company is not subject to market risk associated with risk sensitive 
instruments as the Company does not transact its sales in other than United 
States dollars, does not invest in investments other than United States 
instruments and has not entered into hedging transactions.


Item 8. Financial Statements and Supplementary Data
---------------------------------------------------

The following financial statements and supplementary data of the Company 
sets forth the information required by this item.


                        ARMATRON INTERNATIONAL, INC.
                         Consolidated Balance Sheets
                         September 30, 1998 and 1997

<TABLE>
<CAPTION>
                                                                             1998            1997
                                                                             ----            ----

                               ASSETS
<S>                                                                       <C>             <C>
Current Assets:
  Cash and cash equivalents                                               $ 2,677,000     $ 1,126,000
  Trade accounts receivable, (less allowance for doubtful
   accounts of $65,000 in 1998 and $116,000 in 1997)                        1,799,000       2,389,000
  Inventories                                                               2,088,000       2,711,000
  Deferred taxes                                                               37,000         113,000
  Prepaid and other current assets                                            141,000         165,000
                                                                          ---------------------------
      Total Current Assets                                                  6,742,000       6,504,000

Property and equipment, net                                                   449,000         589,000

Other assets                                                                  139,000         171,000
                                                                          ---------------------------

      Total Assets                                                        $ 7,330,000     $ 7,264,000
                                                                          ===========================

          LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIENCY)
Current Liabilities:
  Accounts payable                                                        $   802,000     $   695,000
  Other current liabilities                                                   925,000         908,000
  Interest payable to related parties                                       1,395,000         917,000
  Current portion under capital lease obligations                              21,000          18,000
                                                                          ---------------------------
      Total Current Liabilities                                             3,143,000       2,538,000
                                                                          ---------------------------

Long-term debt, related parties                                             4,715,000       4,715,000
                                                                          ---------------------------
Long-term capital lease obligations, net of current portion                    10,000          30,000
                                                                          ---------------------------
Deferred rent, net of current portion                                          18,000          38,000
                                                                          ---------------------------

Stockholders' Equity (Deficiency):
  Common stock, par value $1 per share, 6,000,000 shares authorized; 
   2,606,481 shares issued at September 30, 1998 and 1997                   2,606,000       2,606,000
  Additional paid-in capital                                                6,770,000       6,770,000
  Accumulated deficit                                                      (9,546,000)     (9,047,000)
                                                                          ---------------------------
                                                                             (170,000)        329,000
Less: Treasury stock at cost - 146,732 at September 30, 1998 and 1997         386,000         386,000
                                                                          ---------------------------

      Total Stockholders' Equity (Deficiency)                                (556,000)        (57,000)
                                                                          ---------------------------

      Total Liabilities and Stockholders' Equity (Deficiency)             $ 7,330,000     $ 7,264,000
                                                                          ===========================
</TABLE>


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


                        ARMATRON INTERNATIONAL, INC.
                    Statements of Consolidated Operations
            for the years ended September 30, 1998, 1997 and 1996

<TABLE>
<CAPTION>
                                                    1998            1997            1996
                                                    ----            ----            ----

<S>                                              <C>             <C>             <C>
Net sales                                        $12,885,000     $13,314,000     $13,750,000

Cost of products sold                             10,409,000      11,126,000      11,054,000
                                                 -------------------------------------------

Gross margin                                       2,476,000       2,188,000       2,696,000

Selling, general and administrative expenses       2,418,000       2,492,000       2,625,000

Provision for (recovery of) bad debts                 36,000         (60,000)         62,000
                                                 -------------------------------------------

Operating profit (loss)                               22,000        (244,000)          9,000
                                                 -------------------------------------------

Other income (expense):
  Interest expense-third parties                     (30,000)        (57,000)        (49,000)
  Interest expense-related parties                  (478,000)       (478,000)       (480,000)
  Interest income                                     63,000          62,000          57,000
  Unusual item                                             -         450,000               -
  Other income - net                                       -          (2,000)          3,000
                                                 -------------------------------------------

Other income (expense) - net                        (445,000)        (25,000)       (469,000)
                                                 -------------------------------------------

Loss before income taxes                            (423,000)       (269,000)       (460,000)

Provision for income taxes                            76,000          17,000          35,000
                                                 -------------------------------------------

Net loss                                         $  (499,000)    $  (286,000)    $  (495,000)
                                                 ===========================================

Net loss per  share of common stock              $      (.20)    $      (.12)    $      (.20)
                                                 ===========================================

Weighted average number of common
 shares outstanding                                2,459,749       2,459,749       2,459,749
                                                 ===========================================
</TABLE>


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


                        ARMATRON INTERNATIONAL, INC.
                    Consolidated Statements of Cash Flows
            for the Years Ended September 30, 1998, 1997 and 1996

<TABLE>
<CAPTION>
                                                            1998            1997            1996

<S>                                                      <C>             <C>             <C>
OPERATING ACTIVITIES
Net loss                                                 $ (499,000)     $ (286,000)     $ (495,000)
Adjustments to reconcile net loss to net cash flows
 from operating activities:
Depreciation and amortization                               287,000         333,000         395,000
Amortization of deferred rent                               (20,000)        (18,000)              -
Deferred taxes                                               76,000          17,000          35,000
Provision (recovery) for bad debts                           36,000         (60,000)         62,000
Loss  on disposal of equipment                                    -               -           1,000
Unusual item                                                      -        (450,000)              -
Change in operating assets and liabilities:
  Accounts receivable                                       554,000        (208,000)          6,000
  Inventories                                               623,000        (362,000)       (124,000)
  Prepaid and other current assets                           24,000          64,000         (26,000)
  Other assets                                               32,000         (18,000)          9,000
  Accounts payable                                          107,000        (476,000)         59,000
  Interest due to related parties                           478,000         478,000         439,000
  Other current liabilities                                  17,000          42,000         141,000
  Deferred rent                                                   -               -          75,000
                                                         ------------------------------------------
Net cash flow from (used for) operating activities        1,715,000        (944,000)        577,000
                                                         ------------------------------------------

INVESTING ACTIVITIES
Proceeds from sales of equipment                                  -           2,000               -
Payments for machinery and equipment                       (147,000)       (222,000)        (50,000)
Proceeds from sale of former subsidiary                                     450,000               -
                                                         ------------------------------------------
Net cash flow from (used for) investing activities         (147,000)        230,000         (50,000)
                                                         ------------------------------------------

FINANCING ACTIVITIES
Payments on capital lease obligations                       (17,000)         (9,000)              -
                                                         ------------------------------------------

Net cash flow from (used for) financing activities          (17,000)         (9,000)              -
                                                         ------------------------------------------

Net increase (decrease) in cash and cash equivalents      1,551,000        (723,000)        527,000

Cash and cash equivalents at beginning of year            1,126,000       1,849,000       1,322,000
                                                         ------------------------------------------

Cash and cash equivalents at end of year                 $2,677,000      $1,126,000      $1,849,000
                                                         ==========================================
</TABLE>


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


                        ARMATRON INTERNATIONAL, INC 
        CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIENCY)
            For the Years Ended September 30, 1998, 1997 and 1996


<TABLE>
<CAPTION>
                                                                                                               Total
                            Common Stock                                            Treasury Stock         Stockholders'
                       -----------------------     Paid-In      Accumulated     -----------------------       Equity
                        Shares        Amount       Capital        Deficit        Shares       Amount       (Deficiency)
                        ------        ------       -------      -----------      ------       ------       -------------

<S>                    <C>          <C>           <C>           <C>             <C>          <C>             <C>
Balance,
 September 30, 1995    2,606,481    $2,606,000    $6,770,000    $(8,266,000)    (146,732)    $(386,000)      $ 724,000
Net Loss                       -             -             -       (495,000)           -             -        (495,000)
-----------------------------------------------------------------------------------------------------------------------

Balance,
 September 30, 1996    2,606,481     2,606,000     6,770,000     (8,761,000)    (146,732)     (386,000)        229,000
Net Loss                       -             -             -       (286,000)           -             -        (286,000)
-----------------------------------------------------------------------------------------------------------------------

Balance,
 September 30, 1997    2,606,481     2,606,000     6,770,000     (9,047,000)    (146,732)     (386,000)        (57,000)
Net Loss                       -             -             -       (499,000)           -             -        (499,000)
-----------------------------------------------------------------------------------------------------------------------

Balance,
 September 30, 1998    2,606,481    $2,606,000    $6,770,000    $(9,546,000)    (146,732)    $(386,000)      $(556,000)

=======================================================================================================================
</TABLE>


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


                        ARMATRON INTERNATIONAL, INC.
                 Notes to Consolidated Financial Statements


1.   NATURE OF BUSINESS

The Company operates principally in two segments, the Consumer Products 
segment and the Industrial Products segment. There are no intercompany sales 
between segments.

Operations in the Consumer Products segment involve the manufacture and 
distribution of Flowtron leaf-eaters, bugkillers, yard carts, biomisters, 
storage sheds, compost bins and doghouses which comprised 93% and 97% of the 
Company's sales for the years ended September 30, 1998 and 1997, 
respectively.  The Company distributes its consumer products primarily to 
major retailers throughout the United States, with some products distributed 
under customer labels.  Substantially all of this segment's sales and 
accounts receivable related to business activities with such retailers.  

The Industrial Products segment manufactures electronic obstacle avoidance 
systems for transportation and automotive applications and markets these 
systems under the trademark "Echovision".  


2.   SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation

The consolidated financial statements include the accounts of Armatron 
International, Inc. and its wholly owned subsidiary.  All intercompany 
balances and transactions have been eliminated in consolidation.

Certain reclassifications have been made to prior year amounts to conform to 
current year presentations.

Revenue Recognition

Revenue from product sales is recognized at the time the products are 
shipped.  Following industry trade practice, the Company's Consumer Products 
segment offers extended payment terms for delivery of seasonal items.  Sales 
terms for the Company's Industrial products segment are 30 days net.  A 
provision is recorded for sales allowances and incentives related to volume 
and program incentives offered to the Company's various customers.

Cash and Cash Equivalents

The Company considers all highly liquid instruments purchased with an 
original maturity of less than three months to be cash equivalents.  The 
Company invests excess funds in short-term, interest-bearing obligations, 
including reverse repurchase agreements and commercial paper.

The Company has no requirements for compensating balances.  The Company 
maintains its cash in bank deposit accounts which, at times, may exceed 
Federally insured limits and in deposit accounts at its commercial finance 
company.  The Company has not experienced any losses in such accounts.  The 
Company believes it is not exposed to any significant credit risk on cash 
and cash equivalents.

Inventories

Inventories are stated on a first-in, first-out (FIFO) basis at the lower of 
cost or market.

Property and Equipment 

Property and equipment are stated at cost.  Depreciation is computed based 
upon the estimated useful lives of the various assets using the straight-
line method with annual rates of depreciation of 10 to 33-1/3%.  Capitalized 
tooling costs are amortized over three years.  Leasehold improvements are 
amortized over the lesser of the term of the lease or the estimated useful 
life of the related assets.  Tooling and molding costs are charged to a 
deferred cost account as incurred, prepaid tooling, until the tool or mold 
is completed.  Upon completion the costs are transferred to a 
property/equipment account.  Depreciation expense was $287,000, $325,000 and 
$363,000 for fiscal 1998, 1997 and 1996, respectively.  Maintenance and 
repairs are charged to operations as incurred.  Renewals and betterments 
that materially extend the life of assets are capitalized and depreciated.  
Upon disposal, the asset cost and related accumulated depreciation are 
removed from their respective accounts.  Any resulting gain or loss is 
reflected in earnings.

Deferred Rent

Deferred rent results from amortizing the lease related to the Company's 
operating facility over the term of the lease on a straight-line basis.

Advertising

The Company expenses advertising as incurred.  Advertising expense was 
$308,000, $213,000 and $322,000 for fiscal 1998, 1997 and 1996, respectively.

Income Taxes

Deferred income taxes are provided for temporary differences between 
financial statement and income tax reporting principally from the 
carryforward of unused net operating losses, tax credits, and alternative 
minimum taxes.

Fair Value of Financial Instruments

The carrying value of cash and cash equivalents and long-term debt 
approximate their fair value based on instruments with similar terms and 
maturities.

Use of Estimates

The presentation of financial statements in conformity with generally 
accepted accounting principles requires management to make estimates and 
assumptions that affect the reported amounts of assets and liabilities and 
disclosure of contingent assets and liabilities at the date of the financial 
statements and the reported amounts of revenues and expenses during the 
reporting period.  Actual results could differ from those estimates.

Earnings (Loss) Per Share

Earnings (loss) per share of common stock is computed on the basis of 
weighted average number of common shares outstanding in each year.


3.   NEW ACCOUNTING PRONOUNCEMENTS

In 1997, the Financial Accounting Standards Board ("FASB") issued Statement 
of Financial Accounting Standards ("SFAS") No. 130, "Reporting Comprehensive 
Income" and SFAS No. 131 "Disclosure about Segments of an Enterprise and 
Related Information."  These pronouncements are effective for fiscal years 
beginning after December 15, 1997.  The Company does not believe that these 
new pronouncements will have a material effect on its financial statements.

In 1998, the American Institute of Certified Public Accountants issued 
Statement of Position 98-1, "Accounting for Costs of Computer Software 
Developed or Obtained for Internal Use."  The Company does not believe that 
this pronouncement will have a material impact on its business or results of 
operations. 


4.   YEAR 2000 DATE CONVERSION

The Year 2000 issue is the result of computer programs being written using 
two digits rather than four to define the applicable year.  Any of the 
Company's computer programs that have date-sensitive software may recognize 
a date using "00" as the year 1900 rather than the year 2000.  This could 
result in a system failure or miscalculations causing disruptions of 
operations, including, among other things, a temporary inability to process 
transactions, forecast production needs and the timing of raw material 
purchases, send invoices, or engage in similar normal activities.

The Company has completed the analysis and evaluation phase of its Year 2000 
project and has determined that it will be required to modify or replace 
significant portions of its hardware and software so that its computer 
systems will properly recognize dates beyond December 31, 1999.  The Company 
has also begun the process of upgrading and modernizing its major 
information systems, including its operating and financial systems.  The 
replacement systems will be Year 2000 compliant.  The Company expects to 
begin using its new systems during the second quarter of fiscal 1999.  The 
Company will utilize both internal and external resources to reprogram or 
replace, and test the software for Year 2000 modifications.  The Company 
plans to complete its Year 2000 project no later than July 31, 1999.  The 
total cost of upgrading most of the Company's major operating and financial 
systems, including the Year 2000 project, for fiscal years 1998 through 
2000, is estimated at $100,000 and is being funded through operating cash 
flows and leasing arrangements.  Of the total project cost, approximately 
$80,000 has been expended and is attributable to the purchase of new 
software and hardware.  The remaining $20,000 will be expensed as incurred.

There can be no assurance the systems of other companies on which the 
Company's systems rely will be timely converted, or that a failure to 
convert by another company, or a conversion that is incompatible with the 
Company's systems, would not have material adverse effect on the Company.   
The Company has been in communication with its major vendors to ensure 
compatibility of systems.  If such systems do not function properly the 
Company could experience delays in receipt of its raw materials which would 
result in delays in scheduled deliveries of shipments by the Company.

The Company expects to begin developing contingency plans to determine what 
actions the Company will take if its trading partners are not Year 2000 
compliant.  The Company expects the contingency plan to be completed by the 
end of the third quarter in fiscal 1999.

The costs of the project and the date on which the Company plans to complete 
the Year 2000 modifications are based on management's best estimates, which 
were derived utilizing numerous assumptions of future events including the 
continued availability of certain resources, third party modification plans 
and other factors.  However, there can be no assurance that these estimates 
will be achieved and actual results could differ materially from those 
plans.  Specific factors that might cause such material differences include, 
but are not limited to, the availability and cost of personnel trained in 
this area, the ability to locate and correct all relevant computer codes, 
and similar uncertainties.


5.   CONCENTRATION OF CREDIT RISK

Financial instruments, which potentially subject the Company to 
concentration of credit risk, consist principally of trade accounts 
receivable.  If any of the Company's major customers fail to pay the 
Company on a timely basis, it could have a material adverse effect on the 
Company's business, financial condition and results of operations.

For the year ended September 30, 1998, Sears, Roebuck and Co. and Home 
Depot, Inc. accounted for approximately 29% and 11% of the Company's net 
sales, respectively.  At September 30, 1998, Sears, Roebuck and Co. and Home 
Depot, Inc. accounted for approximately 44% and 2%, respectively, of the 
Company's trade accounts receivable balance.

For the year ended September 30, 1997, Sears, Roebuck and Co. and Home 
Depot, Inc. accounted for approximately 32% and 10%, respectively, of the 
Company's net sales.  At September 30, 1997, Sears, Roebuck and Co. and Home 
Depot, Inc. accounted for approximately 53% and 4%, respectively, of the 
Company's trade accounts receivable balance.

For the year ended September 30, 1996, Sears, Roebuck and Co., accounted for 
approximately 18% of the Company's net sales.  As of September 30, 1996, 
this customer accounted for approximately 33% of the Company's trade 
accounts receivable balance.

The Company's export sales are not significant.


6.   SUPPLEMENTAL CASH FLOW INFORMATION

The Company's cash payments for interest and income taxes and the Company's 
non-cash investing and financing activities for the years ended September 
30, 1998, 1997 and 1996 were as follows:

<TABLE>
<CAPTION>
                                                      1998        1997        1996
                                                      ----        ----        ----

<S>                                                  <C>         <C>         <C>
Interest paid - related parties                      $     -     $     -     $49,000
Interest paid - third parties                        $30,000     $57,000     $41,000

Income taxes paid                                    $     -     $     -     $     -

Non-cash investing and financing activities:
  Capital expenditures financed by capital lease     $     -     $57,000     $     -
</TABLE>


7.   MAJOR SUPPLIERS

The Company had purchased its plastic storage sheds, yard carts, compost bins 
and dog houses from one supplier.  In July 1998, the Company transferred its 
production molds for yard carts to a new supplier.  In November 1998, the 
Company transferred its production mold for compost bins and storage sheds 
to the same new supplier.  The new supplier has begun production runs for 
the yard carts, storage sheds and compost bins and has not experienced any 
significant difficulties in meeting scheduled deliveries.  The suppliers 
manufacture the products in accordance with the Company's designs and 
specifications.  The Company believes that other suppliers could provide the 
required products although comparable terms may not be realized.  A change 
in suppliers could cause a delay in scheduled deliveries of products to the 
Company's customers and a possible loss of revenue, which would adversely 
affect the Company's results of operations.


8.   INVENTORIES

Inventories consisted of the following at September 30:

<TABLE>
<CAPTION>
                                                    1998           1997
                                                    ----           ----

<S>                                              <C>            <C>
Raw Material, primarily purchased components     $1,338,000     $1,680,000
Work in Process                                      29,000         21,000
Finished Goods                                      721,000      1,010,000
                                                 -------------------------
                                                 $2,088,000     $2,711,000
                                                 =========================
</TABLE>


9.   PROPERTY AND EQUIPMENT 

Property and equipment  consisted of the following at September 30:

<TABLE>
<CAPTION>
                                                      1998           1997
                                                      ----           ----

<S>                                                <C>            <C>
Leasehold improvements                             $  141,000     $  149,000
Furniture and fixtures                                221,000        396,000
Machinery and equipment                             1,752,000      1,828,000
Capitalized tooling cost                            3,974,000      3,980,000
                                                   -------------------------
                                                    6,088,000      6,353,000
Less accumulated depreciation and amortization      5,639,000      5,764,000
                                                   -------------------------
                                                   $  449,000     $  589,000
                                                   =========================
</TABLE>


10.  OTHER ASSETS

Other assets consisted of the following at September 30: 

<TABLE>
<CAPTION>
                                                               1998         1997
                                                               ----         ----

<S>                                                          <C>          <C>
Other receivable, net of current portion                     $ 33,000     $ 64,000
Note receivable - employee, due under terms of an annual
 renewal note, interest payable monthly at an annual
 rate of 6%, secured by a second mortgage                     100,000      100,000
Other                                                           6,000        7,000
                                                             ---------------------
                                                             $139,000     $171,000
                                                             =====================
</TABLE>


11.  OTHER CURRENT LIABILITIES

Other current liabilities consisted of the following at September 30:

<TABLE>
<CAPTION>
                                                              1998         1997
                                                              ----         ----

<S>                                                         <C>          <C>
Retirement plan                                             $313,000     $331,000
Salaries, commissions and benefits                            62,000       68,000
Sales allowances and incentives                              109,000      163,000
Professional fees                                            205,000       78,000
Warranty costs                                                57,000       37,000
Advertising costs                                            103,000       82,000
Other                                                         76,000      149,000
                                                            ---------------------
                                                            $925,000     $908,000
                                                            =====================
</TABLE>


12.  DEBT

Long-term debt

The Company has a $7,000,000 line of credit with a realty trust operated for 
the benefit of the Company's principal shareholders.  This line of credit, 
with interest at 10%, requires monthly payments of interest only, and is 
collateralized by all assets of the Company.  Such collateral is subordinate 
to the revolving line of credit agreement with the finance company.  In 
October 1998, the Company renewed this line of credit with the realty trust 
operated for the benefit of the Company's principal shareholders under the 
same terms and conditions and extended the maturity date to October 1, 1999.   
Therefore this line of credit has been classified as long-term on the 
accompanying balance sheet.  The Company had $4,715,000 outstanding under 
this line of credit at September 30, 1998 and 1997.   Repayment of this line 
of credit is subordinate to the repayment of any and all balances 
outstanding on the revolving line of credit from a commercial finance 
company which is further described below.  Related interest expense incurred 
in the years ended September 30, 1998, 1997 and 1996 was $478,000, $478,000 
and $480,000.  At September 30, 1998, interest payments of $1,395,000 
associated with this line were in arrears for the period November 1, 1995 to 
September 30, 1998.  On November 24, 1998, the Company received a waiver for 
the covenant violation as to the interest payments.  The waiver extends the 
due date as to the interest payments until September 30, 1999.

Note Payable

The Company has a revolving line of credit agreement with a commercial 
finance company, Congress Financial Corporation, which permits combined 
borrowings up to $3,500,000 in cash and letters of credit.  This credit 
agreement is collateralized by all assets of the Company and expires in 
December 1999.  The terms of this agreement include a borrowing limit which 
fluctuates depending on the levels of accounts receivable and inventory 
which collateralize the borrowings.  The agreement contains various 
covenants pertaining to maintenance of working capital, net worth, 
restrictions on dividend distributions and other conditions.  Interest on 
amounts outstanding is payable on a monthly basis at an annual rate of 1 
3/4% over the commercial base rate.  The commercial base rate was 8.5% at 
September 30, 1998.  At September 30, 1998, the Company did not have letters 
of credit or borrowings outstanding and approximately $1,168,000 was 
available, pursuant to the borrowing formula, under this credit agreement.  

A summary of borrowings on commercial finance company and bank revolving 
credit agreements and unused lines of credit for the years ended September 
30, 1998, 1997, and 1996 were as follows:

<TABLE>
<CAPTION>
                                             1998           1997           1996
                                          ----------------------------------------

<S>                                       <C>            <C>            <C>
Average borrowings during the year                 -     $   96,000     $  313,638
Average interest rate during the year              -          10.25%         10.67%
Maximum borrowings during the year                 -     $  912,000     $1,365,000
Unused line of credit at September 30     $3,500,000     $3,283,000     $3,169,000
</TABLE>


13.  STOCK OPTIONS

The Company's incentive stock option plan terminated December 1, 1990.  
Options were granted to officers and key employees to purchase common shares 
at prices not less than the fair market value on the date of grant.  Options 
are exercisable in varying installments and expire in varying periods which 
may not exceed ten years from the date of the grant.

Information concerning stock options for the years ended September 30, 1998, 
1997 and 1996 is summarized below:

<TABLE>
<CAPTION>
                              Options Outstanding
                             Shares     Price Range
                             ------     -----------

      <S>                    <C>        <C>
      September 30, 1995     20,000     $1.75 - $2.50
        Granted                   -           -
        Exercised                 -           -
        Canceled                  -           -
                             ------------------------
      September 30, 1996     20,000     $1.75 - $2.50
        Granted                   -           -
        Exercised                 -           -
        Canceled                  -           -
                             ------------------------
      September 30, 1997     20,000     $1.75 - $2.50
        Granted                   -           -
        Exercised                 -           -
        Canceled             (5,000)    $1.75
                             ------------------------
      September 30, 1998     15,000     $2.38 - $2.50
                             ========================
</TABLE>


At September 30, 1998 and 1997, options for 15,000 and 20,000 shares, 
respectively, were exercisable and these options expire in fiscal 1999.  The 
average exercise price of outstanding options is $2.44.


14.  INCOME TAXES

The provision for income taxes for the years ended September 30, 1998, 1997, 
and 1996 consisted of the following:

<TABLE>
<CAPTION>
                                       1998         1997          1996
                                       ----         ----          ----

<S>                                  <C>          <C>           <C>
Current Tax Provision
  Federal                            $      -     $       -     $       -
  State                                     -             -             -
                                     ------------------------------------
Total Current Provision                     -             -             -
                                     ------------------------------------

Deferred Tax (Benefit)/Expense
  Federal                             (20,000)      201,000      (160,000)
  State                                (6,000)      137,000       (39,000)
                                     ------------------------------------
Total Deferred (Benefit)/Expense      (26,000)      338,000      (199,000)
Change in Valuation Allowance         102,000      (321,000)      234,000
                                     ------------------------------------
Income Taxes (Benefit)/Expense       $ 76,000     $  17,000     $  35,000
                                     ====================================
</TABLE>


The significant items comprising the deferred tax assets and liabilities are 
as follows at September 30:

<TABLE>
<CAPTION>
                                                   1998            1997
                                                   ----            ----

<S>                                           <C>             <C>
Deferred Tax Assets:
  Doubtful receivables                        $    29,000     $    51,000
  Inventory obsolescence and shrinkage            246,000         235,000
  Sales allowances                                 80,000          46,000
  Warranties                                       25,000          17,000
  Non-qualified executive retirement plan         139,000         147,000
  Tax loss carryforwards                        6,609,000       6,620,000
  Tax credit carryforwards                        268,000         268,000
                                              ---------------------------
      Subtotal                                  7,396,000       7,384,000
Deferred Tax Liabilities:
  Excess of tax over book depreciation            (73,000)        (87,000)
                                              ---------------------------
Net Deferred Taxes                              7,323,000       7,297,000
Less valuation allowance                       (7,286,000)     (7,184,000)
                                              ---------------------------
Net Deferred Tax Assets                       $    37,000     $   113,000
                                              ===========================
</TABLE>


A reconciliation of the Federal tax rate to the Company's effective tax rate 
for fiscal 1998, 1997 and 1996 are as follows:

<TABLE>
<CAPTION>
                                                                  % of Pretax Income
                                                               1998       l997       1996
                                                               ----       ----       ----

<S>                                                           <C>        <C>        <C>
Federal income tax at statutory rate on loss before taxes      35.0%      35.0%      35.0%
Reduction and adjustments of the valuation allowance          (17.0)     (28.6)     (27.4)
                                                              ----------------------------
Effective income tax rate                                      18.0%       6.4%       7.6%
                                                              ============================
</TABLE>


Changes in the valuation allowance are due to expiration of net operating 
loss carryforwards, tax credit carryovers and the estimated future 
realization of their tax benefits.  The reduction of these tax benefits is 
reflected in these financial statements as an income tax expense.

For income tax purposes the Company has unused Federal operating loss 
carryforwards of $16,516,000 expiring through 2013 and State operating loss 
carryforwards of $12,407,000 expiring through 2003.

In addition to the loss carryforwards the Company has research and 
development and investment tax credit carryovers of $54,000 and $214,000, 
respectively, through 2001 which are available to reduce future tax 
liabilities.

The realization of the net deferred tax assets of $37,000 is dependent on 
the Company's ability to generate sufficient taxable income in the future.  
The Company's expectations about realization of deferred tax assets could 
change if near-term estimates of future taxable income during this 
carryforward period are reduced.


15.  BENEFIT PLANS

The Company has a 401(k) Savings Plan whereby employees may voluntarily 
defer a portion of their compensation and the Company may elect to match a 
portion of the employee deferral.  All employees with at least one year of 
continuous service are eligible for the savings plan.  Company contributions 
vest 100% after five years.  The Company has made no contributions to this 
savings plan in any of the three years in the period ended September 30, 
1998.

The Company also has a retirement plan for certain senior executives.  The 
benefits payable under this retirement plan are based upon a formula which 
allows for the offset of benefits under other offered retirement plans and 
Social Security benefits.  At September 30, 1998, the unfunded benefit 
obligation of this retirement plan was approximately $313,000.  The Company 
has made no contributions to this retirement plan in any of the three years 
in the period ended September 30, 1998.


16.  COMMITMENTS AND CONTINGENCIES

The Company was obligated at September 30, 1998 under certain operating 
leases for various types of equipment and the Company's operating facility.  
Rental expense for fiscal 1998, 1997 and 1996 was $406,000, $366,000 and 
$420,000, respectively.  The future minimum lease commitments total $740,000 
as follows:  $350,000 in fiscal 1999, $343,000 in fiscal 2000, $25,000 in 
fiscal 2001, $14,000 in fiscal 2002 and $8,000 in fiscal 2003.  The lease 
for the operating facility expires in September 2000.

Commitments for the purchase of capital expenditures, at September 30, 1998 
totaled $20,000.

In January 1991, the California Department of Health Services issued a 
Corrective Action Order (CAO) against the Company and a former subsidiary.  
The CAO requires the Company and a former subsidiary to comply with a 
Cleanup and Abatement Order that had been issued in 1990 against the Company 
for soil contamination at the site of the former subsidiary.  To date, no 
determination has been made with regard to the extent of any environmental 
damage and who may be liable.  The Company does not believe, based on the 
information available at this time, that the outcome of this matter will 
have a material adverse effect on its financial position or results of 
operations.

An action was filed in U.S. District Court, Central District of California 
in late 1996 relating to the foreign arbitration award described below.  The 
Company was first joined as a party by the first amended petition filed on 
March 3, 1997.  The second amended petition was filed on June 27, 1997.

The action seeks confirmation and enforcement of a foreign arbitration award 
in favor of Alsthom, currently and formerly Chantiers de L'Atlantique 
("Alsthom"), and Assurances Generales de France ("AGF") (collectively 
"Petitioners") against Respondents J.C. Carter Company, Inc. ("JCC III"), 
the Company, Armatron-JCC, Inc., formerly known as J.C. Carter Company, Inc. 
("JCC II"), a former subsidiary of the Company, and ITT Corporation and ITT 
Industries, Inc. (collectively "ITT").  The arbitration related to certain 
cryogenic cargo pumps supplied in the 1970's by the J.C. Carter Company 
Division of ITT ("JCC I") to Alsthom, which installed the pumps in two 
liquid natural gas tanker ships, the Mourad Didouche and the Ramdane Abane.  
The arbitration award was entered in favor of Alsthom and AGF, an insurer 
subrogated to the rights of Alsthom, and against "J.C. Carter Company" or 
"J.C. Carter Company, Inc." by the International Chamber of Commerce in 
Paris in 1995.  The amount of the award as to AGF is 62,431,000 French 
francs ("FF") and as to Alsthom is 5,469,000 FF (an aggregate of 
approximately $7 million U.S. dollars at September 30, 1998), both with 
interest from January 30, 1993 at the "French official rate."

Petitioners' operative pleading in the legal action, its Second Amended 
Petition, seeks confirmation of the award against JCC III and, in addition, 
seeks its confirmation and enforcement against the other Respondents, 
including the Company, on the theories of fraudulent conveyance, collateral 
estoppel and virtual representation, judicial estoppel and equitable 
estoppel, and alter ego and/or successor liability relating to events 
transpiring from 1983 through the completion of the foreign arbitration 
proceeding in 1997.  In 1983, the Company and ITT were parties to an asset 
sale transaction involving the business and assets of JCC I.  JCC II, a now 
inactive California corporation, was formed at that time for purpose of 
acquiring the assets and certain liabilities of JCC I and ceased transacting 
business after the 1987 asset sale transaction with JCC III.

The Company answered the Second Amended Petition denying any liability, 
asserting various affirmative defenses and cross-claims against ITT for 
contractual indemnity and for equitable indemnity.  ITT and JCC III have 
cross-claimed against the Company.

At the present time the Company is unable to determine the outcome of the 
claims asserted by and against the Company in the legal action because the 
case is still at an early stage of discovery and because of the existence of 
disputed issues of fact bearing on the outcome of those claims.  However, 
there can be no assurance that the outcome to the proceedings will not have 
an adverse effect on the financial condition of the Company.

In November 1998, the Company was advised that it had been named as a 
defendant in a lawsuit brought by a consumer of one of the Company's 
products.  The consumer claims that the product caused personal injury and 
other damages.  The Company believes that it has valid defenses.  The 
Company has insurance coverage for such claims and has accrued its insurance 
deductible amount in fiscal 1998 to cover the estimated defense costs 
associated with this matter.


17.  CAPITAL LEASE

In February 1997, the Company financed approximately $57,000 of leasehold 
improvements under a 3 year lease financing agreement with a finance 
company.  This lease arrangement has been accounted for as a financing 
transaction.  The subject leasehold improvements are recorded as an asset 
for financial statement purposes and are being depreciated accordingly.

The future minimum lease payments under this capital lease are as follows:

<TABLE>
                          <S>                            <C>
                          Fiscal 1999                    $24,000
                          Fiscal 2000                     10,000
                                                         -------
                                                         $34,000
                          Imputed interest                (3,000)
                                                         -------
                                                         $31,000
                                                         =======
</TABLE>


18.  RELATED PARTY TRANSACTIONS

The Company paid approximately $60,000 for legal services in each of the 
years ended September 30, 1998, 1997 and 1996 to a law firm to which a 
Director of the Company is a member.

As further described in footnote 12, the Company has a $7,000,000 line of 
credit arrangement from a realty trust operated for the benefit of the 
Company's principal shareholders.


19.  BUSINESS SEGMENT INFORMATION

The Company operates principally in two segments, the Consumer Products 
segment and the Industrial Products segment.  There are no intercompany 
sales between segments.  Operations in the Consumer Products segment involve 
the manufacture and distribution of Flowtron leaf-eaters, bugkillers, yard 
carts, biomisters, storage sheds, compost bins and doghouses which comprised 
93%, 97% and 94% of the Company's sales for the years ended September 30, 
1998, 1997 and 1996, respectively.  The Company distributes its consumer 
products primarily to major retailers throughout the United States, with 
some products distributed under customer labels.  Substantially all of this 
segment's sales and accounts receivable related to business activities with 
such retailers.

The Industrial Products segment manufactures electronic obstacle avoidance 
systems for transportation and automotive applications and markets these 
systems under the trademark "Echovision."  Production of these systems began 
in fiscal 1996.

Operating profit is total revenue less operating expenses excluding interest 
expense, general corporate expenses and income taxes.  Identifiable assets 
by industry segment are those assets that are identified in the operation of 
each of the Company's segments.  Corporate assets are principally cash, 
deferred taxes and other assets.

<TABLE>
<CAPTION>
                                                   For the Years Ended September 30,
                                                 1998            1997            1996
                                                 ----            ----            ----

<S>                                           <C>             <C>             <C>
Net sales to unaffiliated customers:
  Consumer Products                           $11,983,000     $12,898,000     $12,910,000
  Industrial Products                             902,000         416,000         840,000
                                              -------------------------------------------
      Total net sales                         $12,885,000     $13,314,000     $13,750,000
                                              ===========================================

Operating profit (loss)
  Consumer Products                           $   731,000     $   631,000     $   750,000
  Industrial Products                              52,000        (244,000)         29,000
                                              -------------------------------------------
                                                  783,000         387,000         779,000

General corporate expenses                       (761,000)       (631,000)       (770,000)
                                              -------------------------------------------
Consolidated operating profit (loss)               22,000        (244,000)          9,000

Interest expense                                 (508,000)       (535,000)       (529,000)
Interest income                                    63,000          62,000          57,000
Unusual item                                            -         450,000               -
Other income (expense)                                  -          (2,000)          3,000
                                              -------------------------------------------
Loss before income taxes                      $  (423,000)    $  (269,000)    $  (460,000)
                                              -------------------------------------------

Identifiable assets:
  Consumer Products                           $ 4,111,000     $ 5,524,000     $ 5,012,000
  Industrial Products                             366,000         330,000         282,000
  Corporate                                     2,853,000       1,410,000       2,181,000
                                              -------------------------------------------
      Total assets                            $ 7,330,000     $ 7,264,000     $ 7,475,000
                                              ===========================================

Depreciation:
  Consumer Products                           $   274,000     $   301,000     $   359,000
  Industrial Products                              13,000           5,000           4,000
  Corporate                                             -               -               -
                                              -------------------------------------------
      Total depreciation and amortization     $   287,000     $   306,000     $   363,000
                                              ===========================================

Capital expenditures:
  Consumer Products                           $    96,000     $   277,000     $    40,000
  Industrial Products                              51,000           2,000          10,000
                                              -------------------------------------------
      Total capital expenditures              $   147,000     $   279,000     $    50,000
                                              ===========================================
</TABLE>


20.  UNUSUAL ITEM

In fiscal 1989 the Company sold one of its wholly owned subsidiaries and 
pursuant to the sales agreement, the Company would receive an additional 
payment of $450,000 if this subsidiary was subsequently resold.  In the 
fourth quarter of fiscal 1997 the former subsidiary was resold and the 
Company received $450,000 in cash and has recognized this gain as an unusual 
item in the accompanying Statement of Operations for the year ended 
September 30, 1997.


Item 9. Changes in and Disagreements with Accountants on Accounting and 
------------------------------------------------------------------------
        Financial Disclosure.
        ---------------------

Not applicable.


                                  PART III

Item 10.  Directors and Executive Officers of the Registrant
------------------------------------------------------------

The following sets forth the ages, principal occupation and present position 
of each of the Directors and executive officers of the Company.

Director
--------

EDWARD L. HOUSMAN      Age 77, Class A Director, principal occupation: 
                       President of Automatic Radio International Corp. 
                       since 1969 (a wholly-owned subsidiary of the Company 
                       which deals with the international sales of the 
                       Company's products).  Mr. Housman has been actively 
                       engaged in various aspects of the Company's business 
                       for more than 30 years, and has served as a Director 
                       of Armatron International, Inc. continuously since 
                       1959.  Mr. Housman is the brother of Charles J. 
                       Housman, the President and Chairman of the Company.

CHARLES J. HOUSMAN     Age 71, Class B Director, principal occupation: 
                       President and Chairman of the Board of Armatron 
                       International, Inc. since 1987.  Mr. Housman has been 
                       actively engaged in various aspects of the Company's 
                       business for more than 30 years and has served as a 
                       Director of Armatron International, Inc. continuously 
                       since 1960.  Mr. Housman is the brother of Edward L. 
                       Housman, the Class A Director of the Company.

MALCOLM D. FINKS       Age 60, Class C Director, principal occupation: 
                       partner at the law firm of Englander, Finks, Ross, 
                       Cohen & Brander, P.C., Boston, Massachusetts since 
                       1970.  On July 7, 1998 Mr. Finks was appointed to the 
                       Board upon the death of Mr. Englander, the former 
                       Class C Director.  Mr. Finks is Clerk of the Company 
                       and has been a Director of Armatron since July 1998.  
                       Mr. Finks is the sole member of the Company's Audit 
                       Committee.

Other Executive Officers
------------------------

SAL DeYOREO            Age 73, joined Armatron in 1972 and has served as 
                       Vice President since 1976.  Mr. DeYoreo is 
                       responsible for the marketing, sales, engineering and 
                       product development of the Flowtron Outdoor Products 
                       Division.

The Company's executive officers hold office at the pleasure of the Board of 
Directors.  The Board of Directors of the Company is divided into three 
classes.  Each director serves for a three-year term, with one class of 
directors being elected at each annual meeting of stockholders.  The term of 
the Class A Director expires in 1999, the term of the Class B Director 
expires in 2001 and the term of the Class C Director expires in 2000.

Section 16(a) Beneficial Ownership Reporting Compliance
-------------------------------------------------------

Section 16(a) of the Securities Exchange Act of 1934 requires the Company's 
Directors and officers, and persons who own more than ten percent of the 
Company's Common Stock, to file with the Securities and Exchange Commission 
(the "SEC") initial reports of ownership and reports of changes in ownership 
of Common Stock and other equity securities of the Company.  Directors, 
officers and greater than ten percent stockholders are required by SEC 
regulation to furnish the Company with copies of all Section 16(a) forms 
they file.  To the Company's knowledge, based solely on review of the copies 
of the above-mentioned reports furnished to the Company and written 
representations that no other reports were required, during the fiscal year 
ended September 30, 1998 all Section 16(a) filing requirements applicable to 
its Directors and officers and greater than ten percent beneficial owners 
were complied with.


Item 11. Executive Compensation
-------------------------------

The following table sets forth all cash compensation paid or accrued by the 
Company to each of its three most highly compensated executive officers for 
services rendered during the three fiscal years ended September 30, 1998:

                         Summary Compensation Table

<TABLE>
<CAPTION>
                                                Annual Compensation
                                     -----------------------------------------
      Name and                                                  All Other
      Principal Position             Year     Salary($)     Compensation($)(1)
      ------------------             ----     ---------     ------------------

      <S>                            <C>      <C>                 <C>
      Charles J. Housman             1998     $    -0-            $7,961
      CEO                            1997     $    -0-            $7,382
                                     1996     $    -0-            $7,112

      Sal DeYoreo                    1998     $107,363            $  -0-
      Vice President                 1997     $105,000            $  -0-
                                     1996     $105,000            $  -0-

      Edward L. Housman              1998     $    -0-            $7,952
      President, Automatic Radio     1997     $    -0-            $7,382
      International Corp.            1996     $    -0-            $7,112

<FN>
<F1>  Other compensation consists of automobile allowances, as well as 
      medical and dental benefits.  The Company provides medical and dental 
      benefits to the executive officers that are generally available to 
      Company employees.  The amount of perquisites, as determined in 
      accordance with the rules of the Securities and Exchange Commission 
      relating to executive compensation, did not exceed the lesser of 
      $50,000 or 10% of salary for fiscal 1998.
</FN>
</TABLE>


Stock Options & Related SARs
----------------------------

The Company's 1981 Non-Qualified Stock Option Plan which terminated on 
December 1, 1990, provided for the granting of options to purchase the 
Company's Common Stock and related stock appreciation rights (SARs) to the 
salaried officers and other employees of the Company.  No option or stock 
appreciation rights were granted after the plan terminated.  For the period 
October 1, 1997 to September 30, 1998, no stock options were granted or 
exercised.  None of the options held by any named executive office were in-
the-money as of September 30, 1998.

Benefit Plans
-------------

Armatron Executive Retirement Plan
----------------------------------

The Armatron Executive Retirement Plan ("Retirement Plan") provides for the 
payment of retirement benefits to certain senior executives of the Company.  
Under the Retirement Plan, upon reaching age 65, an eligible employee will 
receive an annual retirement benefit payment in an amount equal to 1-1/2% of 
his final average compensation multiplied by the number of years of benefit 
service (not to exceed thirty years) minus 1-2/3% of his primary Social 
Security benefit, multiplied by the number of years of benefit service (not 
to exceed thirty years).  Final average compensation is defined in the 
Retirement Plan as the average of the five highest calendar years of salary 
during the ten years preceding retirement.  Years of benefit service 
includes all years and months of service completed with the Company after 
October 1, 1983.  Payments under the Retirement Plan will be made during the 
life of the eligible employee, provided that a minimum of ten years of 
payments shall be made during the life of the eligible employee or, in the 
event the employee dies, to a designated beneficiary.  In the event an 
employee terminates his employment prior to reaching age 65, he will be 
entitled to receive payments under the Retirement Plan at age 65 if he has 
completed ten years of vesting service.  Vesting service is defined as all 
years and months of service completed with the Company after September 30, 
1978.  As of March 1, 1994 the Executive Retirement Plan has been 
temporarily suspended.  As of September 30, 1998 no date has been 
established for removing the suspension.

The following table shows the estimated annual benefits payable under the 
Retirement Plan to persons in specified average compensation and years of 
service classifications.  The amounts shown have not been reduced to reflect 
the offset amounts based upon primary Social Security benefits.  Average 
compensation for purposes of computing benefits under the Retirement Plan, 
age, years of benefit service and years of vesting service as of September 
30, 1998, for the three officers named in the compensation table are as 
follows: Charles J. Housman-$115,000, age 71, 10 years and 15 years; Sal 
DeYoreo-$106,000, age 73, 12 years and 15 years; and Edward L. Housman-
$96,000, age 77, 10 years and 15 years.

<TABLE>
<CAPTION>
Years of                   Average Compensation
Benefit       ----------------------------------------------
Service       $75,000     $100,000     $125,000     $150,000
--------      -------     --------     --------     --------

<S>           <C>         <C>          <C>          <C>
5             $ 5,625     $  7,500     $  9,375     $ 11,250
10             11,250       15,000       18,750       22,500
15             16,875       22,500       28,125       33,750
20             22,500       30,000       37,500       45,000
30 & over      33,750       45,000       56,250       67,500
</TABLE>


Armatron International, Inc./Dreyfus 401(k) Profit Sharing Plan
---------------------------------------------------------------

On July 1, 1989, the Company established a 401(k) Profit Sharing Plan and 
Trust (the "Profit Sharing Plan"), which plan qualifies under Section 401(k) 
of the Internal Revenue Code for favorable tax treatment as long as the 
Profit Sharing Plan annually meets a special, non-discrimination test.  This 
test is designed to assure a fair mix of contributions among employees at 
all income levels.  In November 1994 the Company changed the Plan name to 
and adopted the Armatron International, Inc./Dreyfus 401(k) Profit Sharing 
Plan and Trust.

Compensation Committee Interlocks and Insider Participation
-----------------------------------------------------------

The Company does not have a compensation committee.  The Board of Directors 
of the Company establishes the salary and other compensation for the 
Company's executive officers.  Both Edward Housman and Charles Housman are 
executive officers of the Company and members of the Company's Board of 
Directors.  They both participated in discussions regarding executive 
officer compensation, including the compensation of Sal DeYoreo.  However, 
neither Edward Housman nor Charles Housman received any salary in fiscal 
1998.

Item 12. Security Ownership of Certain Beneficial Owners and Management
-----------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                                                   Shares
                                                                                 Owned and
                                                                                 Nature of
                                                                                 Beneficial     Percent
            Name                             Principal Occupation                Ownership      of Class
-----------------------------                --------------------                ----------     --------

<S>                               <S>                                            <C>             <C>
CHARLES J. HOUSMAN                President and Chairman of the Board            216,931(1)       8.82%
                                  of Armatron International, Inc.

EDWARD L. HOUSMAN                 President of Automatic Radio                   190,648(1)       7.75%
                                  International Corp. (a wholly-owned 
                                  subsidiary of the Company which deals
                                  with the international sales of the 
                                  Company's products).

MALCOLM D. FINKS                  Attorney, Englander, Finks, Ross,                    0           *
                                  Cohen & Brander, P.C., Boston,
                                  Massachusetts.  On July 7, 1998, 
                                  Mr. Finks was appointed to the Board 
                                  upon the death of Mr. Englander, the 
                                  former Class C Director.  Mr. Finks is 
                                  Clerk of the Company and has been a 
                                  Director of Armatron continuously 
                                  since July 1998.

SAL DeYOREO                       Joined Armatron in 1972 and has served           8,500(2)        *
                                  as Vice President since 1976.  Mr. DeYoreo
                                  is responsible for the marketing, sales,
                                  engineering and product development
                                  of the Flowtron Outdoor Products Division.

All Executive Officers and                                                       416,079         16.86%
Directors of the Company as a
group (4 persons)

<FN>
--------------------
<F*>  Less than 1% of the outstanding Common Stock.
<F1>  Does not include 372,660 shares of Common Stock held by the estates of 
      Frank M. Housman and Herbert E. Housman.  Messrs. Charles J. Housman 
      and Edward L. Housman share voting power, but not investment power, 
      with respect to such shares and disclaim beneficial ownership of such 
      shares.  Also does not include 509,553 shares of Common Stock held by 
      the estate of David Housman, the deceased founder of the Company, and 
      by relatives of Messrs. Edward L. Housman and Charles J. Housman.  
      Messrs.  Edward L. Housman and Charles J. Housman share informal 
      voting control, but not investment power, with respect to such shares 
      and disclaim beneficial ownership of such shares.
<F2>  Includes 7,500 shares of Common Stock issuable pursuant to outstanding 
      stock options that are exercisable within 60 days of January 2, 1999. 
</FN>
</TABLE>


Principal Shareholder
---------------------

There are no beneficial owners of more than 5% of the Company's Common 
Stock, known to the Company, in addition to the Directors of the Company.


Item 13. Certain Relationships and Related Transactions
-------------------------------------------------------

The Company paid to Englander, Finks, Ross, Cohn & Brander, P.C., 
approximately $60,000 for legal services in each of the years ended 
September 30, 1998, 1997 and 1996.  The Company anticipates that fees to 
that firm will be approximately $60,000 during fiscal 1999.  Malcolm D. 
Finks, Clerk and a Director of the Company, is a member of that firm.

The Company has a $7,000,000 line of credit from a realty trust operated for 
the benefit of the Company's principal shareholders.  This line of credit, 
with interest payable at 10%, requires monthly payment of interest only, is 
payable in full on October 1, 1999 and is collateralized by all assets of 
the Company.  The Company had $4,715,000 outstanding under this line of 
credit at September 30, 1998.


                                   PART IV

Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K
-------------------------------------------------------------------------

(a) The following documents are filed as part of this report:
-------------------------------------------------------------

(1) Financial Statements
-----------------------

All financial statements of the Registrant as set forth under Item 8 of this 
report on Form 10-K/A.

(2) Financial Statement Schedules
--------------------------------

<TABLE>
<CAPTION>
SCHEDULE
NUMBER                   DESCRIPTION
--------                 -----------

<S>                      <C>
                         Reports of Independent Accountants
VIII                     Valuation & Qualifying Accounts
</TABLE>


All other financial statement schedules not listed have been omitted because 
they are either not required, not applicable, or the information has been 
included elsewhere in the financial statements or notes thereto.  Columns 
omitted from schedules filed have been omitted because the information is 
not applicable.

(3) Exhibits (numbered in accordance with Item 601 of Regulation S-K):
----------------------------------------------------------------------

<TABLE>
<CAPTION>
      EXHIBIT                                                               INCORPORATION BY
      NUMBER                           DESCRIPTION                            REFERENCE TO
      -------                          -----------                          ----------------

       <C>        <S>                                                            <C>
        3.1       Restated Articles of Organization of January 23, 1984          ***
        3.2       By-laws, as amended, through December 20, 1989                 ***
       10.1       Revolving Line of Credit                                       ****
       10.2+      1981 Non-qualified Stock Option Plan                           ***
       10.7       Loan and Security Agreement                                    *
       10.8+      Armatron International Inc./Dreyfus 401(k) Profit
                   Sharing Plan and Trust: Summary Plan Description              *****
       10.9       Facility Lease                                                 *****
       10.10      $7,000,000 Line of Credit with Related Parties                 **
       21.0       List of Subsidiaries
       23.0       Consent of Independent Accountants
       27.0       Financial Statement Schedule

<FN>
<F*>      Filed as an Exhibit to the Company's Annual Report on Form 10-K 
          for the fiscal year ended September 30, 1994.
<F**>     Filed as an Exhibit to the Company's Form 10-Q for the quarter 
          ended March 31, 1990.
<F***>    Filed as an Exhibit to the Company's Annual Report on Form 10-K 
          for the fiscal year ended September 30, 1990.
<F*****>  Filed as an Exhibit to the Company's Annual Report on Form 10-K 
          for the fiscal year ended  September 30, 1993.
<F******> Filed as an Exhibit to the Company's Annual Report on Form 10-K 
          for the fiscal year ended September 30, 1995.
<F+>      Indicates a management compensation plan.
</FN>
</TABLE>


(b) Reports on Form 8-K
-----------------------

No reports were filed on Form 8-K for the last quarter of the Company's 
fiscal year ended September 30, 1998.



                      REPORT OF INDEPENDENT ACCOUNTANTS
                      ---------------------------------


We have audited the consolidated financial statements and the financial 
statement schedule of Armatron International, Inc. and Subsidiary listed in 
the index in Item 14(a) of the Form 10-K, as amended, for the year ended 
September 30, 1998.  These financial statements and financial statement 
schedule are the responsibility of the Company's management.  Our 
responsibility is to express an opinion on these financial statements and 
financial statement schedule based on our audits.

We conducted our audits in accordance with generally accepted auditing 
standards.  Those standards require that we plan and perform the audit to 
obtain reasonable assurance about whether the financial statements are free 
of material misstatement.  An audit includes examining, on a test basis, 
evidence supporting the amounts and disclosures in the financial statements.  
An audit also includes assessing the accounting principles used and 
significant estimates made by management, as well as evaluating the overall 
financial statement presentation.  We believe that our audits provide a 
reasonable basis for an opinion.

In our opinion, the financial statements referred to above present fairly, 
in all material respects, the consolidated financial position of Armatron 
International, Inc. and Subsidiary as of September 30, 1998 and 1997, and 
the consolidated results of their operations and their cash flows for the 
years ended September 30, 1998, 1997 and 1996 in conformity with generally 
accepted accounting principles.  In addition, in our opinion, the financial 
statement schedule referred to above, when considered in relation to the 
basic financial statements taken as a whole, presents fairly, in all 
material respects, the information required to be included therein.


Needham, Massachusetts                 R. J. GOLD & COMPANY P.C.
November 30, 1998


                                 SIGNATURES


      Pursuant to the requirements of Section 13 or 15(d) of the Securities 
Exchange Act of 1934, the registrant has duly caused this report to be 
signed on its behalf by the undersigned, thereunto duly authorized.


                                       ARMATRON INTERNATIONAL, INC.


January 27, 1999                       By /s/ Charles J. Housman
                                          ----------------------
                                          Charles J. Housman
                                          Chairman of the Board,
                                          President and Director
                                          Chief Executive, Financial
                                          and Accounting Officer          


      Pursuant to the requirements of the Securities Exchange Act of 1934, 
this report has been signed below by the following persons on behalf of the 
Registrant on January 27, 1999, in the capacities indicated.


By /s/ Edward L. Housman               By /s/ Charles J. Housman
   ---------------------                  ----------------------
    Edward L. Housman                      Charles J. Housman
    Director                               Chairman of the Board,
                                           President and Director
                                           Chief Executive, Financial
                                           and Accounting Officer


By /s/ Malcolm D. Finks
   --------------------
       Malcolm D. Finks
       Director



                                EXHIBIT INDEX

<TABLE>
<CAPTION>
      EXHIBIT                                                               INCORPORATION BY
      NUMBER                           DESCRIPTION                            REFERENCE TO
      -------                          -----------                          ----------------

       <C>        <S>                                                            <C>
        3.1       Restated Articles of Organization of January 23, 1984          ***
        3.2       By-laws, as amended, through December 20, 1989                 ***
       10.1       Revolving Line of Credit                                       ****
       10.2+      1981 Non-qualified Stock Option Plan                           ***
       10.7       Loan and Security Agreement                                    *
       10.8+      Armatron International Inc./Dreyfus 401(k) Profit
                   Sharing Plan and Trust: Summary Plan Description              *****
       10.9       Facility Lease                                                 *****
       10.10      $7,000,000 Line of Credit with Related Parties                 **
       21.0       List of Subsidiaries
       23.0       Consent of Independent Accountants
       27.0       Financial Statement Schedule

<FN>
<F*>      Filed as an Exhibit to the Company's Annual Report on Form 10-K 
          for the fiscal year ended September 30, 1994.
<F**>     Filed as an Exhibit to the Company's Form 10-Q for the quarter 
          ended March 31, 1990.
<F***>    Filed as an Exhibit to the Company's Annual Report on Form 10-K 
          for the fiscal year ended September 30, 1990.
<F*****>  Filed as an Exhibit to the Company's Annual Report on Form 10-K 
          for the fiscal year ended  September 30, 1993.
<F******> Filed as an Exhibit to the Company's Annual Report on Form 10-K 
          for the fiscal year ended September 30, 1995.
<F+>      Indicates a management compensation plan.
</FN>
</TABLE>

                        ARMATRON INTERNATIONAL, INC.

              SCHEDULE VIII - VALUATION AND QUALIFYING ACCOUNTS


<TABLE>
<CAPTION>
COLUMN A                  COLUMN B       COLUMN C       COLUMN D       COLUMN E
--------                  --------       --------       --------       --------
                         Balance at     Charged to                    Balance at
                         Beginning      Costs and                       End of 
                         of Period       Expenses      Deductions       Period
                         ----------     ----------     ----------     ----------

<S>                        <C>           <C>            <C>             <C>
Year Ended
September 30, 1996:
-------------------
Allowance for
 doubtful accounts         $179,000      $  2,000       $  5,000        $176,000
Warranty costs               64,000        77,000        101,000          40,000
                           -----------------------------------------------------
                           $243,000      $ 79,000       $106,000        $216,000
                           =====================================================

Year Ended
September 30, 1997:
-------------------
Allowance for
 doubtful accounts         $176,000      $      -       $ 60,000        $116,000
Sales allowances and 
 incentives                       -       163,000              -         163,000
Warranty costs               40,000        64,000         67,000          37,000
                           -----------------------------------------------------
                           $216,000      $227,000       $127,000        $316,000
                           =====================================================

Year Ended
September 30, 1998:
-------------------
Allowance for
 doubtful accounts         $116,000      $ 36,000       $ 87,000        $ 65,000
Sales allowances and
 incentives                 163,000       220,000        274,000         109,000
Warranty costs               37,000        52,000         32,000          57,000
                           -----------------------------------------------------
                           $316,000      $308,000       $393,000        $231,000
                           =====================================================
</TABLE>