<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, 1997.


                                       or


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


     For the transition period from __________________ to _________________


                           COMMISSION FILE NO. 0-20189


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

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


                           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 9, 1998, there were 3,487,300 shares of the Registrant's
common stock, par value $.01, outstanding.



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


<PAGE>   2


                              EQUITRAC CORPORATION

                                      INDEX

                                                                       PAGE
                                                                       ----

PART I - FINANCIAL INFORMATION

Item 1.    Financial Statements

           Condensed Balance Sheets
           as of November 30, 1997
           and February 28, 1997                                        2

           Condensed Statements of Income
           for the three months and nine months
           ended November 30, 1997 and 1996                             3

           Condensed Statement of
           Stockholders' Equity for the
           nine months ended November 30, 1997                          4

           Condensed Statements of Cash Flows
           for the nine months ended
           November 30, 1997 and 1996                                   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


<PAGE>   3





PART I   FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

                              EQUITRAC CORPORATION

                            CONDENSED BALANCE SHEETS
                        (in thousands, except share data)

<TABLE>
<CAPTION>
                                                                        (Unaudited)
                                                                         NOVEMBER 30,      FEBRUARY 28,
                                                                             1997              1997
                                                                        -------------      -------------
<S>                                                                       <C>                <C>     
                                     ASSETS
Current assets:
      Cash and cash equivalents                                           $  4,125           $  4,755
      Investment securities                                                  5,128              4,817
      Accounts receivable, net of allowances of $600 and $550 at             
          November 30, and February 28, respectively                         8,104              6,117
      Inventories                                                            2,052              2,483
      Deferred income taxes                                                    571                581
      Other current assets                                                     392                313
                                                                          --------           --------
             Total current assets                                           20,372             19,066

      Investment securities                                                  2,483              1,330
      Property and equipment, net                                            6,204              6,317
      Intangible assets, net                                                 3,367              3,378
      Deferred income taxes                                                    397                397
      Other assets                                                             188                194
                                                                          --------           --------
             Total assets                                                 $ 33,011           $ 30,682
                                                                          ========           ========

                          LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
      Accounts payable                                                    $    747           $  1,095
      Accrued expenses and other current liabilities                         4,018              3,930
      Unearned income                                                        1,445                882
                                                                          --------           --------
             Total current liabilities                                       6,210              5,907
                                                                          --------           --------

Stockholders' equity:
      Common stock, $.01 par value; 15,000,000 shares
        authorized; 3,858,100 and 3,800,300 shares issued
        at November 30, and February 28, respectively                           39                 38
      Additional paid-in capital                                            11,066             10,741
      Retained earnings                                                     17,927             15,672
      Cumulative translation adjustment                                        (59)               (23)
      Unrealized gain on investment securities, net of tax                      15                 --
      Treasury stock, at cost (370,800 and 330,800 shares at
        November 30, and February 28, respectively)                         (2,187)            (1,653)
                                                                          --------           --------
             Total stockholders' equity                                     26,801             24,775
                                                                          --------           --------
                 Total liabilities and stockholders' equity               $ 33,011           $ 30,682
                                                                          ========           ========

</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,
                                                 ---------------------------      -----------------------
                                                     1997           1996              1997         1996
                                                 -----------    ------------      -----------    --------
<S>                                              <C>            <C>               <C>            <C>    
Revenues:
       Sales                                     $    5,512      $    4,574       $   16,480     $12,984
       Service and support                            4,306           3,450           12,242       9,784
       Rental                                         2,626           2,575            7,821       7,788
                                                 -----------    ------------      -----------    --------
            Total revenues                           12,444          10,599           36,543      30,556
                                                 -----------    ------------      -----------    --------

Expenses:
       Cost of revenues                               5,223           4,036           15,065      11,365
       Product development                              669             574            2,150       1,534
       Selling expenses                               1,697           1,696            5,190       4,866
       General and administrative                     3,705           3,341           10,926      10,072
                                                 -----------    ------------      -----------    --------
            Total expenses                           11,294           9,647           33,331      27,837
                                                 -----------    ------------      -----------    --------
            Operating income                          1,150             952            3,212       2,719

Interest income                                         165             125              435         359
                                                 -----------    ------------      -----------    --------
            Income before income taxes                1,315           1,077            3,647       3,078

Income taxes                                            500             416            1,392       1,192
                                                 -----------    ------------      -----------    --------
            Net income                           $      815     $       661       $    2,255     $ 1,886
                                                 ===========    ============      ===========    ========
Earnings per share                               $     0.22     $      0.18       $     0.61     $  0.53
                                                 ===========    ============      ===========    ========
Weighted average common and common equivalent
    shares outstanding                                3,779           3,578            3,729       3,541
                                                 ===========    ============      ===========    ========



</TABLE>


                             See accompanying notes.



                                       3

<PAGE>   5

                              EQUITRAC CORPORATION
                                        
                  CONDENSED STATEMENT OF STOCKHOLDERS' EQUITY
                                  (Unaudited)
                                        
                    (in thousands, except number of shares)

<TABLE>
<CAPTION>

                                               Common                                     Unrealized
                                              Stock and                                    Gain on
                                              Additional                  Cumulative      Investment                    Total
                                   Common       Paid-in       Retained    Translation     Securities,    Treasury    Stockholders'
                                   Shares       Capital       Earnings    Adjustment      Net of Tax       Stock        Equity
                                 ---------    ----------     ---------    -----------     ----------    ---------    --------------
<S>                              <C>           <C>           <C>           <C>            <C>           <C>           <C>      
Balance, February 28, 1997       3,800,300     $  10,779     $  15,672     $     (23)     $      --     $  (1,653)    $  24,775

Purchase of Treasury Stock
   25,000 shares                        --            --            --            --             --          (534)         (534)

Unrealized gain on marketable
   securities, net of tax               --            --            --            --             15            --            15

Translation Adjustment                  --            --            --           (36)            --            --           (36)

Exercise of employee
   stock options                    57,800           326            --            --             --            --           326

Net income for the nine months
   ended November 30, 1997              --            --         2,255            --             --            --         2,255
                                 ---------     ---------     ---------     ---------      ---------     ---------     ---------

Balance, November 30, 1997       3,858,100     $  11,105     $  17,927     $     (59)     $      15     $  (2,187)    $  26,801
                                 =========     =========     =========     =========      =========     =========     =========


</TABLE>

                             See accompanying notes
 

                                      4

<PAGE>   6




                              EQUITRAC CORPORATION

                       CONDENSED STATEMENTS OF CASH FLOWS
                                   (Unaudited)

                                 (in thousands)

<TABLE>
<CAPTION>
                                                                                NINE MONTHS ENDED
                                                                                  NOVEMBER 30,
                                                                           ------------------------
                                                                             1997             1996
                                                                           -------          -------
<S>                                                                        <C>              <C>    
Cash flows from operating activities:
      Net income                                                           $ 2,255          $ 1,886
      Adjustments to reconcile net income to
          net cash provided by operating activities:
      Depreciation                                                           2,147            1,835
      Amortization                                                             905              808
      Provision for doubtful accounts                                           50               50
      Change in assets and liabilities:
           (Increase) decrease in:
             Accounts receivable                                            (1,681)          (2,007)
             Inventories                                                       456             (437)
             Other current assets                                              (51)             (35)
             Other assets                                                        6              (17)
           Increase (decrease) in:
             Accounts payable                                                 (518)              --
             Accrued expenses                                                   88              (88)
             Unearned income                                                   446              253
                                                                           -------          -------
               Net cash provided by operating activities                     4,103            2,248
                                                                           -------          -------
Cash flows from investing activities:                                                                         
      Purchases of property and equipment                                   (2,027)          (1,911)
      Acquisitions, principally intangible assets                           (1,023)          (1,834)
      Sales and maturities of investment securities                          2,255            1,348
      Purchases of investment securities                                    (3,694)          (1,709)
      Decrease in restricted cash                                               --            1,450
                                                                           -------          -------
               Net cash used in investing activities                        (4,489)          (2,656)
                                                                           -------          -------
Cash flows from financing activities:
      Repayment of acquisition obligations                                      --              (30)
      Proceeds from issuance of common stock                                   326              135
      Purchase of treasury stock                                              (534)              --
                                                                           -------          -------
               Net cash (used in) provided by financing activities            (208)             105
                                                                           -------          -------
      Exchange rate effect on cash                                             (36)              13
                                                                           -------          -------
      Net decrease in cash and cash equivalents                               (630)            (290)
      Cash and cash equivalents at beginning of period                       4,755            3,581
                                                                           -------          -------
      Cash and cash equivalents at end of period                           $ 4,125          $ 3,291
                                                                           =======          =======
      Supplemental disclosure of cash flow information:
             Cash paid during the period for income taxes                  $ 1,825          $ 1,820



</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.


                             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, 1997 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 28, 1997,
     filed with the Securities and Exchange Commission.

2.   USE OF 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 in the financial statements
     and accompanying notes. 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

         All investments in highly liquid marketable securities with a maturity
     of three months or less at the time of purchase are classified as cash
     equivalents.

 5.  INVESTMENT SECURITIES

         The Company's investment securities consist primarily of municipal
     bonds, U.S. Treasury obligations and investment grade corporate bonds with
     maturities ranging from one to twenty-two years. These investments are
     classified as available-for-sale and are recorded at fair value with
     unrealized gains and losses included in stockholders' equity.
     Interest income is recognized when earned.


                                       6
<PAGE>   8


 6.  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.

 7.  PROPERTY AND EQUIPMENT

         Property and equipment consist primarily of system rental equipment
     under operating leases and service equipment used in connection with
     service contracts, and are stated at cost less accumulated depreciation.
     Additions, major renewals and improvements are capitalized, and repair and
     maintenance costs are expensed. Upon retirement or sale, the cost of the
     assets disposed of and the related accumulated depreciation are removed
     from the accounts and any resulting gain or loss is included in the
     determination of net income. Property and equipment are depreciated using
     the straight-line method over the estimated useful lives of the assets.
     Leasehold improvements are amortized using the straight-line method over
     the shorter of the estimated life of the asset or the remaining term of the
     lease.

 8.   PRODUCT DEVELOPMENT COSTS

         Product development costs are expensed as incurred.

 9.   FOREIGN CURRENCY TRANSLATION

         Translation of foreign currencies into U.S. dollars is computed for
     revenue and expense accounts using average exchange rates during the year.
     Net assets of the Company's Canadian operations, whose "functional
     currency" is the Canadian dollar are translated at current rates of
     exchange, with the resulting translation adjustment recorded directly into
     a separate component of stockholders' equity. The functional currency for
     the Company's other foreign operations is the U.S. dollar. Net assets of
     these operations are translated at current rates of exchange, with the
     resulting translation gains and losses included in the statement of income.

 10.  EARNINGS PER SHARE

         Earnings per share (EPS) are based on the weighted average number of
     shares of common stock and common stock equivalents outstanding during the
     year. Common stock equivalents consist of stock options.

 11.  ACQUISITIONS

         Intangible assets recorded in connection with acquisitions represent
     costs allocated to specifically identifiable intangible assets and the
     excess of cost over the fair value of tangible and identifiable intangible
     assets arising from acquisitions ("goodwill"). The costs of all
     identifiable intangible assets and goodwill are amortized on a
     straight-line basis over their respective estimated useful lives, ranging
     from three to seven years.



                                       7
<PAGE>   9


 12.   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 positions or results of
     operations.

 13.   RECLASSIFICATIONS

         Certain prior year amounts have been reclassified to conform with
     current year 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 or software; (2) monthly
revenues from service and software support agreements and (3) monthly revenues
from leases of its systems. 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. 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 not 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 agreements (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,
                                                ----------------------        ----------------------
                                                  1997           1996           1997            1996
                                                -------        -------        -------        -------
<S>                                              <C>            <C>            <C>            <C>  
Revenues:
       Sales                                       44.3%          43.2%          45.1%          42.5%
       Service and support                         34.6           32.5           33.5           32.0
       Rental                                      21.1           24.3           21.4           25.5
                                                -------        -------        -------        -------
             Total revenues                       100.0          100.0          100.0          100.0
                                                -------        -------        -------        -------
Expenses:
       Cost of revenues                            42.0           38.1           41.2           37.2
       Product development                          5.4            5.4            5.9            5.0
       Selling expenses                            13.6           16.0           14.2           15.9
       General and administrative                  29.8           31.5           30.0           33.0
                                                -------        -------        -------        -------
             Total expenses                        90.8           91.0           91.3           91.1
                                                -------        -------        -------        -------
             Operating income                       9.2            9.0            8.7            8.9

       Interest income                              1.3            1.1            1.2            1.2
                                                -------        -------        -------        -------
             Income before income taxes            10.5           10.1            9.9           10.1

       Income taxes                                 4.0            3.9            3.8            3.9
                                                -------        -------        -------        -------
             Net income                             6.5%           6.2%           6.1%           6.2%
                                                =======        =======        =======        =======

</TABLE>



                                       9
<PAGE>   11




REVENUES

     Total revenues for the third quarter ended November 30, 1997 increased 17%
to $12,444,000 from $10,599,000 in the same quarter last fiscal year. For the
nine months ended November 30, 1997, total revenues were $36,543,000, an
increase of 20% over revenues of $30,556,000 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 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 maintenance and lease agreements.

     SALES REVENUES. Sales revenues for the quarter ended November 30, 1997
increased 21% to $5,512,000 from $4,574,000 in the same quarter last fiscal
year. Sales revenues for the nine months ended November 30, 1997 increased 27%
to $16,480,000 from $12,984,000 in the same nine month period last fiscal year.
This increase resulted primarily from an increase in computer equipment resale
revenues from the ECS division due to increased market presence and an increase
in sales of systems manufactured by the Company. Sales revenues included
equipment resale revenues generated by the ECS division of $813,000 and
$2,382,000 during the quarter and nine months ended November 30, 1997, an
increase over revenues of $206,000 and $544,000 in the same quarter and nine
month period last fiscal year. The remaining increases resulted from an increase
in volume of sales of new systems to existing customers and from sales of add-on
equipment to existing customers.

     SERVICE AND SUPPORT REVENUES. Service and support revenues for the quarter
ended November 30, 1997 increased 25% to $4,306,000 from $3,450,000 in the same
quarter last fiscal year. Service and support revenues for the nine months ended
November 30, 1997 increased 25% to $12,242,000 from $9,784,000 in the same nine
month period last fiscal year. The increase resulted primarily from an increase
in service and support revenues generated by the ECS division and an increase in
service contracts in the Company's cost recovery divisions. Service and support
revenue generated by the ECS division increased to $671,000 and $1,692,000
during the quarter and nine months ended November 30, 1997, respectively from
$260,000 and $623,000 in the same quarter and nine month period last fiscal
year.

     RENTAL REVENUE. Rental revenues for the quarter ended November 30, 1997
were $2,626,000 compared to $2,575,000 in the same quarter last fiscal year.
Rental revenues for the nine months ended November 30, 1997 increased to
$7,821,000 from $7,788,000 in the same nine month period last fiscal year.





                                       10
<PAGE>   12


EXPENSES

     COST OF REVENUES. Cost of revenues is comprised primarily of (i) payroll
and other expenses related to the Company's manufacturing, customer support and
service personnel, (ii) the cost of hardware and other system components
associated with system sales and service and (iii) depreciation of system rental
and service units. Cost of revenues for the quarter ended November 30, 1997
increased to $5,223,000, or 42.0% of total revenues, from $4,036,000, or 38.1%
of total revenues, in the same quarter last fiscal year. Cost of revenues for
the nine months ended November 30, 1997 increased to $15,065,000, or 41.2% of
total revenues, from $11,365,000, or 37.2% of total revenues. This increase in
the cost of revenues as a percentage of total revenues is attributable to lower
gross margins in the Company's ECS division compared to the Company's cost
recovery divisions. Management anticipates that the cost of revenues as a
percentage of total revenues may continue to increase in future periods to the
extent that the ECS division contributes a higher percentage of the Company's
revenues.

     PRODUCT DEVELOPMENT EXPENSES. Product development expenses for the quarter
ended November 30, 1997 increased to $669,000, or 5.4% of total revenues from
$574,000, or 5.4% of total revenues, in the same quarter last fiscal year.
Product development expenses for the nine months ended November 30, 1997
increased to $2,150,000, or 5.9% of total revenues, from $1,534,000, or 5.0% 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. Products under development during these periods include (i)
TelemeTrac(TM), a product which collects and consolidates photocopier meter
totals remotely through cellular telephone networks, (ii) PrintLog(TM), a
digital output tracking application designed to track all pages printed from a
workstation to laser printers and network photocopiers and assign each
transaction to a client, project or department, (iii) OneTrac(TM), an
inexpensive copy and fax control product line developed for resale through both
the Equitrac direct sales force and through copier dealers, and (iv) an
exclusive OEM product line for Pitney Bowes. Management anticipates deriving
revenues from some of these products beginning in the fourth quarter of fiscal
1998 and to a greater extent in fiscal 1999. The Company does not capitalize any
of its software product development costs since software 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
during the period. Management anticipates that product development costs will
continue to increase in future periods compared to the respective periods in the
previous fiscal year, as the projects under development are completed and the
Company invests in the development of additional products.

     SELLING EXPENSES. Selling expenses for the quarter ended November 30, 1997
increased to $1,697,000, or 13.6% of total revenues from $1,696,000, or 16.0% of
total revenues, in the same quarter last fiscal year. Selling expenses for the
nine months ended November 30, 1997 increased to $5,190,000, or 14.2% of total
revenues, from $4,866,000, or 15.9% of total revenues, in the same nine month
period last fiscal year. These decreases in selling expenses as a percentage of
revenues resulted primarily from incremental revenues derived per sales
representative during the quarter and nine months ended November 30, 1997
compared to the same quarter and nine month period last fiscal year.





                                       11
<PAGE>   13



      GENERAL AND ADMINISTRATIVE EXPENSES. General and administrative expenses
for the quarter ended November 30, 1997 increased to $3,705,000, or 29.8% of
total revenues, from $3,341,000, or 31.5% of total revenues, in the same quarter
last fiscal year. General and administrative expenses for the nine months ended
November 30, 1997 increased to $10,926,000, or 30.0% of total revenues, from
$10,072,000, or 33.0% 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 internal sales growth without adding a commensurate level of
support and administrative positions.

     INTEREST INCOME. The Company's interest income increased to $165,000 during
the quarter ended November 30, 1997 from $125,000 during the same quarter last
fiscal year. Interest income for the nine months ended November 30, 1997
increased to $435,000 from $359,000 in the same nine month period last fiscal
year.

     INCOME TAXES. The Company's effective income tax rate was 38.0% and 38.1%
for the quarter and nine months ended November 30, 1997, compared to 38.6% and
38.7% in the same quarter and nine month period last fiscal year. The decrease
in the Company's effective tax rate resulted primarily from the increase in the
Company's research and development tax credit due to the increase in product
development expenditures.

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 increased to $11,736,000 at November 30,
1997 from $10,902,000 at February 28, 1997. The Company generated $4,103,000 in
cash from operating activities during the nine months ended November 30, 1997.
Cash flows used in investing activities included the acquisition of $2,027,000
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.

     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, 1997,
the Company repurchased 370,800 shares of its outstanding common stock at an
aggregate purchase price of $2,187,000. 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.





                                       12
<PAGE>   14


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

                  11.   Statement of Computation of Earnings per Share

              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 14, 1998                      By: /s/ GEORGE P. WILSON
                                                --------------------------------
                                                George P. Wilson
                                                President and Chief
                                                Executive Officer



Date: January 14, 1998                      By: /s/ SCOTT J. MODIST
                                                --------------------------------
                                                Scott J. Modist
                                                Vice President - Finance, 
                                                Treasurer and Chief Financial 
                                                Officer
                                                  



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