<PAGE>   1

            ---------------------------------------------------------

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                          -----------------------------

                                   FORM 10-Q


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

For the quarterly period ended November 30, 1996.

                                      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 NO. 0-20189

                              EQUITRAC CORPORATION
             (Exact name of Registrant as specified in its charter)


                FLORIDA                                59-1797862
    (State or other jurisdiction of       (IRS Employee Identification Number)
     incorporation or organization)


                          836 PONCE DE LEON BOULEVARD
                          CORAL GABLES, FLORIDA 33134
                                 (305) 442-2060

              (Address, including zip code, and telephone number,
                      including area code, of registrant's
                          principal executive offices)


     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 the
filing requirements for at least the past 90 days.  Yes  X    No    .
                                                        ---      ---


     As of January 6, 1996, there were 3,433,900 shares of the Registrant's
common stock, par value $.01, outstanding.



            ---------------------------------------------------------




<PAGE>   2




                              EQUITRAC CORPORATION

                                     INDEX

[CAPTION]
<TABLE>
                                                                 Page
                                                                 ----
<S>                <C>                                            <C>

PART I - FINANCIAL INFORMATION

Item 1.            Financial Statements

                   Condensed Balance Sheets
                   as of November 30, 1996
                   and February 29, 1996                           2

                   Condensed Statements of Income
                   for the three months and nine months
                   ended November 30, 1996 and 1995                3

                   Condensed Statement of
                   Stockholders' Equity for the
                   nine months ended November 30, 1996             4

                   Condensed Statements of Cash Flows
                   for the nine months ended
                   November 30, 1996 and 1995                      5

                   Notes to Condensed Financial Statements         6

                   Item 2.Management's Discussion and Analysis
                   of Financial Condition and Results of
                   Operations                                      9


PART II - OTHER INFORMATION

Item 6.            Exhibits and Reports on Form 8-K               14


SIGNATURES                                                        14
</TABLE>



<PAGE>   3



PART I   FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS



                              EQUITRAC CORPORATION

                            CONDENSED BALANCE SHEETS
                                  (Unaudited)

                      (in thousands, except share amounts)


<TABLE>
<CAPTION>
                                                             NOVEMBER 30,  FEBRUARY 29,
                          ASSETS                                 1996          1996
                                                             ------------  ------------
<S>                                                          <C>                <C>
Current assets:
 Cash and cash equivalents                                    $ 3,291           $ 3,581
 Restricted cash                                                    -             1,450
 Investment securities                                          4,175             4,031
 Accounts receivable, net of allowance of $400 and $350         6,287             4,330
 Inventories                                                    2,577             1,780
 Deferred income taxes                                            499               499
 Other current assets                                             401               366
                                                              -------           -------
      Total current assets                                     17,230            16,037
                                                                                
Investment securities                                           1,592             1,361
Property and equipment, net                                     6,134             6,034
Intangible assets, net                                          3,310             2,067
Other assets                                                      164               147
                                                              -------           -------
      Total assets                                            $28,430           $25,646
                                                              =======           =======
          LIABILITIES AND STOCKHOLDERS' EQUITY                                  
Current liabilities:                                                            
 Accounts payable                                             $   622           $   622
 Accrued expenses                                               2,877             2,965
 Unearned income and other current liabilities                    908                84
                                                              -------           -------
      Total current liabilities                                 4,407             3,671
Deferred income taxes                                             157               151
                                                              -------           -------
      Total liabilities                                         4,564             3,822
                                                              -------           -------
Stockholders' equity:                                                           
 Common stock, $.01 par value; 15,000,000 shares                                
   authorized, 3,758,900 and 3,717,750 shares issued                            
   at November 30, 1996, and February 28, 1995 respectively        38                37
Additional paid-in capital                                     10,524            10,390
Retained earnings                                              14,944            13,058
Cumulative translation adjustment                                 (12)              (25)
Unrealized gain on investment securities, net of tax               25                17
Treasury stock, at cost (330,800 shares at November 30, and                     
   February 29, 1996)                                          (1,653)           (1,653)
                                                              -------           -------
      Total stockholders' equity                               23,866            21,824
                                                              -------           -------
          Total liabilities and stockholders' equity          $28,430           $25,646
                                                              =======           =======
</TABLE>


                            See accompanying notes.


                                       2



<PAGE>   4





                              EQUITRAC CORPORATION

                         CONDENSED STATEMENTS OF INCOME
                                  (Unaudited)

                   (in thousands, except earnings per share)


<TABLE>
<CAPTION>
                                         THREE MONTHS ENDED    NINE MONTHS ENDED
                                            NOVEMBER 30,          NOVEMBER 30,
                                        --------------------  --------------------
                                          1996       1995       1996       1995
                                        ---------  ---------  ---------  ---------
<S>                                       <C>        <C>        <C>        <C>

Revenues:
 Sales                                    $ 4,574     $3,257    $12,984    $ 9,957
 Service and support                        3,450      2,548      9,784      7,455
 Rental                                     2,575      2,568      7,788      7,610
                                          -------     ------    -------    -------
                                                                           
     Total revenues                        10,599      8,373     30,556     25,022
                                          -------     ------    -------    -------
                                                                           
Expenses:                                                                  
 Cost of revenues                           4,036      3,051     11,365      9,042
 Product development                          574        368      1,534        942
 Selling expenses                           1,696      1,306      4,866      4,188
 General and administrative                 3,341      3,037     10,072      9,027
                                          -------     ------    -------    -------
                                                                           
     Total expenses                         9,647      7,762     27,837     23,199
                                          -------     ------    -------    -------
                                                                           
        Operating income                      952        611      2,719      1,823
                                                                           
Interest income                               125         80        359        224
                                          -------     ------    -------    -------
                                                                           
        Income before income taxes          1,077        691      3,078      2,047
                                                                           
Income taxes                                  416        263      1,192        768
                                          -------     ------    -------    -------
                                                                           
        Net income                        $   661     $  428    $ 1,886    $ 1,279
                                          =======     ======    =======    =======
                                                                           
Earnings per share                        $  0.18     $ 0.12    $  0.53    $  0.35
                                          =======     ======    =======    =======
                                                                           
Weighted average common and common                                         
 equivalent shares used in calculation      3,578      3,537      3,541      3,615
                                          =======     ======    =======    =======
</TABLE>









                             See accompanying notes

                                       3



<PAGE>   5



                              EQUITRAC CORPORATION

                  CONDENSED STATEMENT OF STOCKHOLDERS' EQUITY
                                  (Unaudited)

                    (in thousands, except number of shares)


<TABLE>

                                                                                                                         
                                                                                     UNREALIZED                          
                                                                                      GAIN ON                             
                                  COMMON STOCK    ADDITIONAL            CUMULATIVE   INVESTMENT                          
                                  --------------    PAID-IN   RETAINED  TRANSLATION  SECURITIES,  TREASURY  STOCKHOLDERS'
                                  SHARES  AMOUNT    CAPITAL   EARNINGS  ADJUSTMENT   NET OF TAX    STOCK      EQUITY       
                                  ------  ------  ----------  --------  -----------  -----------  --------  ------------
<S>                             <C>         <C>    <C>      <C>           <C>           <C>      <C>          <C>
Balance, February 29, 1996      3,717,750   $37    $10,390   $13,058      $(25)         $17      $(1,653)     $21,824

Unrealized gain on marketable                                                                                 
 securities, net of tax                 -     -          -         -         -            8            -            8

Translation Adjustment                  -     -          -         -        13            -            -           13

Exercise of employee                                                                                          
 stock options                     41,150     1        134         -         -            -            -          135

Net income for the nine months                                                                                
 ended November 30, 1996                -     -          -     1,886         -            -            -        1,886
                                ---------   ---    -------  --------      ----          ---      -------      -------

Balance, November 30, 1996      3,758,900   $38    $10,524   $14,944      $(12)         $25      $(1,653)     $23,866
                                =========   ===    =======  ========      ====          ===      =======      =======
</TABLE> 

                            See accompanying notes.

                                       4



<PAGE>   6


                              EQUITRAC CORPORATION

                       CONDENSED STATEMENTS OF CASH FLOWS
                                  (Unaudited)

                                 (in thousands)

<TABLE>
<CAPTION>
                                                                NINE MONTHS ENDED
                                                                   NOVEMBER 30,
                                                                ------------------
                                                                 1996       1995
                                                                 ----       ----
<S>                                                              <C>        <C>
Cash flows from operating activities:
  Net income                                                     $1,886     $1,279
  Adjustments to reconcile net income to                                
    net cash provided by operating activities:                          
    Depreciation                                                  1,835      1,732
    Amortization                                                    808        705
    Provision for doubtful accounts                                  50          -
    Change in assets and liabilities:                                   
      (Increase) decrease in:
        Accounts receivable                                      (2,007)     1,233
        Inventories                                                (437)      (157)
        Other current assets                                        (35)      (183)
        Other assets                                                (17)         7
      Increase (decrease) in:
        Accounts payable and accrued expenses                       (88)      (687)
        Unearned income                                             253       (217)
                                                                 ------     ------
          Net cash provided by operating activities               2,248      3,712
                                                                 ------     ------
Cash flows from investing activities:                                       
  Purchases of property and equipment                            (1,911)    (1,616)
  Acquisition of product line, principally intangible assets     (1,834)      (222)
  Sales and maturities of investment securities                   1,348      3,268
  Purchases of investment securities                             (1,709)    (3,769)
  Restricted cash                                                 1,450          -
                                                                 ------     ------
          Net cash used in investing activities                  (2,656)    (2,339)
                                                                 ------     ------
Cash flows from financing activities:                                       
  Repayment of acquisition obligations                              (30)       (25)
  Proceeds from issuance of common stock                            135         19
  Purchase of treasury stock                                          -     (1,282)
                                                                 ------     ------
          Net cash provided by (used in) financing activities       105     (1,288)
                                                                 ------     ------ 
Exchange rate effect on cash                                         13          9 
                                                                 ------     ------ 
Net (decrease) increase in cash and cash equivalents               (290)        94 
Cash and cash equivalents at beginning of period                  3,581      2,187 
                                                                 ------     ------ 
Cash and cash equivalents at end of period                       $3,291     $2,281 
                                                                 ======     ====== 
Supplemental disclosure of cash flow information:
  Cash paid during the period for income taxes                   $1,820     $  747
</TABLE>


Non-cash investing and financing activities during the nine months ended
November 30, 1996 included $611,000 of intangible assets acquired through the
assumption of a liability to fulfill service contracts in connection with the
Infortext Acquisition and a $10,000 reduction in intangible assets resulting
from the reduction of a liability in connection with a contingent consideration
adjustment related to an acquisition.  Non-cash investing and financing
activities during the nine months ended November 30, 1995 consisted of $72,000
of assets and liabilities recorded in connection with acquisitions and a
$335,000 reduction in intangible assets resulting from the reduction of notes
payable in connection with a contingent consideration adjustment related to the
acquisitions.

                            See accompanying notes.

                                       5



<PAGE>   7



                              EQUITRAC CORPORATION

               NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS


1.  BASIS OF PRESENTATION

        The accompanying unaudited condensed financial statements have been
    prepared by the Company, in accordance with generally accepted accounting
    principles, pursuant to the rules and regulations of the Securities and
    Exchange Commission.  Certain information and footnote disclosure normally
    included in financial statements have been condensed or omitted pursuant to
    such rules and regulations.  In the opinion of management, the accompanying
    financial statements include all adjustments (of a normal recurring nature)
    which are necessary to state fairly the results for the interim periods
    presented.  The results for the nine months ended November 30, 1996 are not
    necessarily indicative of the results to be expected for the full fiscal
    year.  These unaudited condensed financial statements should be read in
    conjunction with the financial statements and notes thereto included in the
    Annual Report on Form 10-K for the fiscal year ended February 29, 1996,
    filed with the Securities and Exchange Commission.

2.  MANAGEMENT ESTIMATES

        The preparation of financial statements in conformity with generally
    accepted accounting principals 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 periods.  Actual results could differ from those estimates.

3. REVENUE RECOGNITION

        Sales revenue is recognized upon installation and customers' acceptance.
    Service and support revenues are recognized ratably over the period in which
    the service and support are provided. Rental contract revenue, which
    includes service and support on the underlying rental equipment and
    software, is recognized ratably over the term of the respective lease.
    Rental contracts are accounted for as operating leases.

4. CASH AND CASH EQUIVALENTS

        Cash equivalents include all highly liquid investments with maturities
    of three months or less when purchased.  The Company maintains cash and cash
    equivalent balances with high quality financial institutions.  The Company
    periodically evaluates the relative credit risk of these financial
    institutions.

5.  INVESTMENT SECURITIES

        Investment securities generally consist of municipal bonds, U.S.
    Treasury obligations and investment grade corporate bonds with maturities
    ranging from six months to twenty-one years.


                                       6



<PAGE>   8




6.  PROPERTY AND EQUIPMENT

        Property and equipment consist primarily of system equipment rented to
    customers and system equipment used to service customers with service
    contracts and are carried at cost less accumulated depreciation.  Rental
    equipment is depreciated on a straight line basis over five years.

7.  INVENTORIES

        Inventories comprised primarily of system components, parts and supplies
    are carried at the lower of weighted-average cost or market.  The weighted
    average cost of inventories approximates the "first in-first out" ("FIFO")
    method.

8.  PRODUCT DEVELOPMENT COSTS

        Product development costs are expensed as incurred.

9.  EARNINGS PER SHARE

        Earnings per share is computed by dividing net income by the weighted
    average number of common and common equivalent shares during the period.
    Dilutive outstanding stock options are considered common stock equivalents
    and are included in the calculation using the treasury stock method.

10. ACQUISITIONS

        On March 1, 1996, the Company acquired the cost recovery customer base
    of ISI Infortext, Inc. ("ISI"), a distributor of cost recovery and
    telemanagement products.  The transaction was financed by $1,834,000 in
    cash, including $1,450,000 of cash restricted for that purpose as of
    February 29, 1996, and the assumption of a liability of $611,000 to fulfill
    service contracts.  Additional consideration is contingent upon the results
    of the acquisition during fiscal 1997.

        Intangible assets recorded in connection with this and previous
    acquisitions represent costs allocated to specifically identifiable assets
    and the excess of cost over the fair market value of tangible and
    identifiable intangible assets arising from these acquisitions ("goodwill").
    The costs of all identifiable intangible assets are being amortized on a
    straight line basis over their respective estimated useful lives, ranging
    from three to ten years.  Goodwill is amortized over ten years. Amortization
    expense on the intangible assets for the nine months ended November 30, 1996
    and 1995 was $808,000 and $705,000, respectively.



                                       7



<PAGE>   9




11. CONTINGENCIES

        The Company is involved from time to time in legal proceedings incident
    to the normal course of its business.  Management believes that adverse
    decisions in any pending or threatened proceedings would not have a material
    adverse effect on the Company's financial position or results of operations.

        Certain aspects of the Company's fiscal 1992, 1993 and 1994 federal
    income tax returns are currently under examination by the Internal Revenue
    Service ("IRS").  The IRS is reviewing the characterization and useful lives
    of certain intangible assets of the Company.  A report previously issued by
    the IRS assessing additional taxes, penalties and interest for the 1992
    fiscal year has been rejected by the IRS appeals division and the case has
    been returned to the initial examiner.  A revised report has not been
    received regarding the Company's 1992 tax return and no report has been
    received regarding the Company's 1993 and 1994 tax returns.  If the IRS
    prevails, the Company may be required to make payments relating to the
    timing of tax deductions taken on these federal income tax returns.  The
    Company may also be assessed interest and penalties.  Although management
    and its tax advisors believe that the Company has a meritorious position,
    the ultimate outcome of this matter cannot presently be determined and,
    therefore, no liability has been recorded at this time.  The Company intends
    to vigorously defend its position.

12. RECLASSIFICATIONS

        Certain interim statement of income items have been reclassified to
    conform with the fiscal year 1997 presentation.






                                       8



<PAGE>   10




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

RESULTS OF OPERATIONS

     The Company's revenues are derived from three principal sources: (1) sales
of new systems, upgrades and add-ons of equipment and software; (2) maintenance
service and software support agreements and (3) leases of its system equipment
and software.  The Company offers its customers the option of purchasing a
system or leasing a system pursuant to an operating lease (the term of which is
typically 36 months or longer), which includes all service and software support
services.  The Company offers its purchase customers service and software
support agreements (the terms of which are typically for 36 months or longer).
Systems that are neither leased nor purchased in conjunction with a service
contract are serviced by the Company on a time-and-materials basis.  The
Company's computer service division offers its customers service contracts (the
terms of which are typically for 12 months) and also provides service on a
time-and-materials basis.

     The following table sets forth selected items in the Condensed Statements
of Income as a percentage of total revenues.


<TABLE>
<CAPTION>
                                    THREE MONTHS ENDED    NINE MONTHS ENDED
                                       NOVEMBER 30,          NOVEMBER 30,
                                   --------------------  --------------------
                                     1996      1995       1996       1995
                                     ----      ----       ----       ----
  <S>                               C>        <C>        <C>        <C>
  Revenues:                         
    Sales                           43.2%      38.9%      42.5%      39.8%
    Service and support             32.5       30.4       32.0       29.8
    Rental                          24.3       30.7       25.5       30.4
                                    ----       ----       ----       ----
       Total revenues               00.0       00.0       00.0       00.0
                                    ----       ----       ----       ----
                                                                     
  Expenses:                                                          
    Cost of revenues                38.1       36.4       37.2       36.1
    Product development              5.4        4.4        5.0        3.8
    Selling expenses                16.0       15.6       15.9       16.7
    General and administrative      31.5       36.3       33.0       36.1
                                    ----       ----       ----       ----
       Total expenses               91.0       92.7       91.1       92.7
                                    ----       ----       ----       ----
  Operating income                   9.0        7.3        8.9        7.3
  Interest income                    1.1        0.9        1.2        0.9
                                    ----       ----       ----       ----
       Income before income taxes   10.1        8.2       10.1        8.2
  Income taxes                       3.9        3.1        3.9        3.1
                                    ----       ----       ----       ----
  Net income                        6.2%       5.1%       6.2%       5.1%
                                    ====       ====       ====       ====
</TABLE>                            



                                       9


<PAGE>   11




REVENUES

     Total revenues for the third quarter ended November 30, 1996 increased 27%
to $10,599,000 from $8,373,000 in the same quarter last fiscal year.  For the
nine months ended November 30, 1996, total revenues were $30,556,000, an
increase of 22% over revenues of $25,022,000 recorded in the same nine month
period in the prior fiscal year.  The Company's total revenues increased
primarily as a result of increases in sales revenues and service and support
revenues.  System sales revenues were comprised primarily of revenues from
sales of new systems to existing and acquired customers and, to a lesser
extent, from sales of new systems to new customers and from sales of add-on
equipment to existing customers.  Service and support revenues and rental
revenues were comprised primarily of recurring revenues from existing and
acquired maintenance and lease agreements.

     Sales revenues.  Sales revenues for the quarter ended November 30, 1996
increased 40% to $4,574,000 from $3,257,000 in the same quarter last fiscal
year.  Sales revenues for the nine months ended November 30, 1996 increased 30%
to $12,984,000 from $9,957,000 in the same nine month period last fiscal year.
A portion of these increases in sales revenues resulted from sales of new
systems to customers acquired through the Infortext acquisition.  Sales
revenues derived from customers acquired through the Infortext acquisition were
$697,000 and $1,722,000 during the quarter and nine months ended November 30,
1996, respectively.  The remaining increases resulted from an increase in
volume of sales of new systems to existing customers.

     Service and support revenues.  Service and support revenues for the
quarter ended November 30, 1996 increased 35% to $3,450,000 from $2,548,000 in
the same quarter last fiscal year.  Service and support revenues for the nine
months ended November 30, 1996 increased 31% to $9,784,000 from $7,455,000 in
the same nine month period last fiscal year.  A portion of these increases in
service and support revenues resulted from revenues derived from customers
acquired through the Infortext acquisition and increased revenues in the
Company's computer services division.  Service and support revenues derived
from customers acquired through the Infortext acquisition were $388,000 and
$1,155,000 during the quarter and nine months ended November 30, 1996,
respectively.  Service and support revenues generated by the Company's computer
service division increased to $260,000 and $623,000 during the quarter and nine
months ended November 30, 1996, respectively from $88,000 and $212,000 in the
same quarter and nine month period last fiscal year.

     Rental Revenue.  Rental revenues for the quarter ended November 30, 1996
were $2,575,000 compared to $2,568,000 in the same quarter last fiscal year.
Rental revenues for the nine months ended November 30, 1996 increased to
$7,788,000 from $7,610,000 in the same nine month period last fiscal year.
These increases in rental revenue resulted from rental contracts acquired at
the end of last fiscal year relating to a settlement with a leasing company.
Rental revenues derived from these acquired contracts were $70,000 and $286,000
for the quarter and nine months ended November 30, 1996, respectively.  As a
result of this settlement, rental revenue is anticipated to be higher in the
fourth quarter of the current fiscal year than in the fourth quarter of last
fiscal year.  However, due to the trend of customers purchasing new systems
rather than entering into new lease agreements as their old lease agreements
expire, Management anticipates that rental revenue will comprise a decreasing
percentage of total revenues in future periods.


                                       10



<PAGE>   12



EXPENSES

     Cost of revenues.  Cost of revenues is comprised primarily of (i) the cost
of hardware and other system components associated with system sales and
service, (ii) payroll and other expenses related to the Company's
manufacturing, customer support and service personnel and (iii) depreciation of
system rental and service units.  Cost of revenues for the quarter ended
November 30, 1996 increased to $4,036,000, or 38.1% of total revenues, from
$3,051,000, or 36.4% of total revenues, in the same quarter last fiscal year.
Cost of revenues for the nine months ended November 30, 1996 increased to
$11,365,000, or 37.2% of total revenues, from $9,042,000, or 36.1% of total
revenues.  These increases in cost of revenues as a percentage of revenues
resulted primarily from (i) the higher cost of manufacturing the Company's
newest terminals compared to older product lines together with an increase in
sales of these new terminals as a percentage of total sales, (ii) the higher
cost of revenues as a percentage of revenues in the Company's newly acquired
Infortext Group division compared to the Company's existing cost recovery
divisions and (iii) the existence of lower margin resales of computer equipment
by the Company's computer service division.  Partially offsetting these
increases were the rental revenues acquired in the leasing company settlement
without related costs of revenues.

     Product development expenses.  Product development expenses for the
quarter ended November 30, 1996 increased to $574,000, or 5.4% of total
revenues from $368,000, or 4.4% of total revenues, in the same quarter last
fiscal year. Product development expenses for the nine months ended November
30, 1996 increased to $1,534,000, or 5.0% of total revenues, from $942,000, or
3.8% of total revenues, in the same nine month period last fiscal year.
Current development efforts are focused on enhancing and expanding the Equitrac
and Infortext cost recovery product lines as well as developing several new
products.  Development efforts include joint development projects with major
office equipment manufacturers relating primarily to tracking and reporting
activity on laser printers, digital copiers and other office equipment.  Other
new products under development include the Equitrac Professional Internet
Client ("E.P.I.C."), a full-featured Internet browser designed to control
Internet access and track on-line research and e-mail for billing and
management purposes and the development of TelemeTrac(TM), a product which
collects and consolidates photocopier meter totals remotely through cellular
telephone networks.  The Company does not capitalize any of its product
development costs since development costs incurred subsequent to attainment of
technological feasibility of a new product line are not deemed to be
significant; accordingly product development expenses for each period include
all hardware and software development costs incurred.  Management anticipates
product development expenses to remain above previous fiscal year levels for
the remainder of the current fiscal year due to the Company's increased product
development activities which are focused on new technologies.  Additionally,
Management does not anticipate to derive revenues from the new products under
development until the second half of next fiscal year.

     Selling expenses.  Selling expenses for the quarter ended November 30,
1996 increased to $1,696,000, from $1,306,000 in the same quarter last fiscal
year.  Selling expenses were 16% of total revenues in the third quarter of the
current fiscal year and last fiscal year.  Selling expenses for the nine months
ended November 30, 1996 increased to $4,866,000, or 15.9% of total revenues,
from $4,188,000, or 16.7% of total revenues, in the same nine month period last
fiscal year.  This decrease in selling expenses as a percentage of revenues
resulted primarily from higher revenues per sales representative during the
nine months ended November 30, 1996 compared to the same nine month period last
fiscal year.


                                       11



<PAGE>   13



     General and administrative expenses.  General and administrative expenses
for the quarter ended November 30, 1996 increased to $3,341,000, or 31.5% of
total revenues, from $3,037,000, or 36.3% of total revenues, in the same
quarter last fiscal year.  General and administrative expenses for the nine
months ended November 30, 1996 increased to $10,072,000, or 33.0% of total
revenues, from $9,027,000, or 36.1% of total revenues, in the same nine month
period last fiscal year.  These decreases in general and administrative
expenses as a percentage of revenues resulted primarily from the Company's
ability to increase revenues through acquisitions of customer bases and
internal sales growth without adding a commensurate level of support and
administrative positions.

     Interest income.  The Company's interest income increased to $125,000
during the quarter ended November 30, 1996 from $80,000 during the same quarter
last fiscal year.  Interest income for the nine months ended November 30, 1996
increased to $359,000 from $224,000 in the same nine month period last fiscal
year.  These increases in interest income resulted from both higher
interest-earning asset balances and higher yields on invested balances as the
Company reallocated a portion of its investment portfolio out of municipal
bonds into higher yielding investment grade securities.

     Income taxes.  The Company's effective income tax rate was 38.6% and 38.7%
for the quarter and nine months ended November 30, 1996, compared to 38.1% and
37.5% in the same quarter and nine month period last fiscal year.  These
increases in the Company's effective tax rate resulted primarily from a
reduction in tax exempt municipal bond interest income.

     Certain aspects of the Company's fiscal 1992, 1993 and 1994 federal income
tax returns are currently under examination by the Internal Revenue Service
("IRS").  The IRS is reviewing the characterization and useful lives of certain
intangible assets of the Company.  A report previously issued by the IRS
assessing additional taxes, penalties and interest for the 1992 fiscal year has
been rejected by the IRS appeals division and the case has been returned to the
initial examiner.  A revised report has not been received regarding the
Company's 1992 tax return and no report has been received regarding the
Company's 1993 and 1994 tax returns.  If the IRS prevails, the Company may be
required to make payments relating to the timing of tax deductions taken on
these federal income tax returns.  The Company may also be assessed interest
and penalties.  Although management and its tax advisors believe that the
Company has a meritorious position, the ultimate outcome of this matter cannot
presently be determined and, therefore, no liability has been recorded at this
time.  The Company intends to vigorously defend its position.

LIQUIDITY AND CAPITAL RESOURCES

     The Company has funded its operations over the past several years
principally from cash flow from operations.  The Company's cash and cash
equivalents and investment securities decreased to $9,058,000 at November 30,
1996 from $10,423,000 at February 29, 1996.  This decrease in cash and cash
equivalents and investment securities resulted primarily from the Infortext
acquisition.  This acquisition was financed by $1,834,000 in cash, including
$1,450,000 of cash restricted for that purpose as of February 29, 1996, and the
assumption of a liability of $611,000 to fulfill service contracts.  Additional
consideration is contingent upon the results of the acquisition during fiscal
1997.  Cash flows used in investing activities included the acquisition of
$1,911,000 of property and equipment, primarily system rental units which are
leased to customers and system service units which are used to service
customers with service contracts.  Partially offsetting these uses of cash was
the generation of $2,248,000 in cash from operating activities during the nine
months ended November 30, 1996.

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<PAGE>   14



     The Board of Directors has authorized the Company to spend up to
$2,000,000 to repurchase shares of the Company's issued and outstanding common
stock, based upon consideration of the Company's current cash position,
management's expectations of future cash flows from operating activities and
the level of cash required to fund future growth opportunities.  Through
November 30, 1996, the Company repurchased 330,800 shares of its outstanding
common stock at an aggregate purchase price of $1,653,000.  Future purchases
will be made from time to time subject to prevailing market conditions in open
market or privately negotiated transactions.

     The Company anticipates that its cash and cash equivalents and marketable
securities and cash flow from operating activities will be adequate to meet the
Company's cash requirements for the foreseeable future.

FORWARD LOOKING STATEMENTS

     Certain statements in this Form 10-Q, including statements contained
herein under the caption "Management's Discussion and Analysis of Financial
Condition and Results of Operations", constitute "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act of 1995.
Such forward looking statements involve known and unknown risks, uncertainties
and other factors which may cause the actual results, performance or
achievements of the Company to be materially different from any future results,
performance or achievements express or implied by such forward-looking
statements.  Such factors include, but are not limited to the following:
general economic and business conditions; charges and costs related to
acquisitions; and the ability of the Company to develop and market products for
the markets in which it operates, to successfully integrate its acquired
products and services, to adjust to changes in technology, customer
preferences, enhanced competition and new competitors in the markets in which
it operates.




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<PAGE>   15





PART II  OTHER INFORMATION


ITEM 6.  Exhibits and Reports on Form 8-K



         A.  Exhibits

         4.  11. Statement of Computation of Earnings per Share

             27. Financial Data Schedule (for SEC use only).

         B.  Reports on Form 8-K

             None.



                                   SIGNATURES

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


                                          EQUITRAC CORPORATION




Date:  January 10, 1997                   By:  /s/  George P. Wilson
                                              -----------------------------
                                              George P. Wilson
                                              President and Chief
                                              Executive Officer




Date:  January 10, 1997                   By: /s/  Scott J. Modist
                                              --------------------------
                                              Scott J. Modist
                                              Vice President - Finance,
                                              Treasurer and Chief Financial
                                              Officer


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