Microwave Filter Company and Subsidiaries

Condensed Consolidated Balance Sheets (Unaudited)


	December 31, 2013			September 30, 2013

Assets
Current Assets:
Cash and cash equivalents		$	945,313		$	939,959
Accounts receivable-trade, net of
allowance for doubtful accounts
of $26,000 and $26,000			147,247			201,163
Federal and state income tax recoverable			0			37,085
Inventories, net			556,606			566,500
Prepaid expenses and other current assets			123,167			98,973

Total current assets			1,772,333			1,843,680

Property, plant and equipment, net			550,409			580,750

Total assets		$	2,322,742		$	2,424,430

Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable		$	118,594		$	68,632
Customer deposits			42,421			16,362
Accrued payroll and related expenses			47,180			46,453
Accrued compensated absences			97,270			94,272
Notes payable - short term			41,162			40,697
Other current liabilities			35,674			35,199

Total current liabilities			382,301			301,615

Notes payable -long term			442,291			452,771
Total other liabilities			442,291			452,771

Total liabilities			824,592			754,386

<PAGE> 3


Stockholders' Equity:
Common stock, $.10 par value
Authorized 5,000,000 shares,
Issued 4,324,140 shares in 2014 and 2013,
Outstanding 2,585,086 shares in 2014 and 2013		432,414		432,414
Additional paid-in capital		3,248,706		3,248,706
Retained deficit		(491,354)		(319,460)

Common stock in treasury, at cost
1,739,054 shares in 2014 and 2013		(1,691,616)		(1,691,616)

Total stockholders' equity		1,498,150		1,670,044

Total liabilities and stockholders' equity	$	2,322,742	$	2,424,430

June 30, 2013 September 30, 2012

Assets
Current Assets:
Cash and cash equivalents $
409,697 $
1,023,017
Accounts receivable-trade, net of
     allowance for doubtful accounts
     of $26,000 and $26,000
228,249
263,385
Inventories, net
593,006
529,075
Prepaid expenses and other current assets
86,736
111,342

Total current assets
1,317,688
1,926,819

Property, plant and equipment, net
621,703
672,525

Total assets $
1,939,391 $
2,599,344

Liabilities and Stockholders' Equity

Current liabilities:
Accounts payable $
84,926 $
92,325
Customer deposits
29,707
30,563
Accrued payroll and related expenses
42,373
51,289
Accrued compensated absences
117,568
172,198
Other current liabilities
28,865
31,308

Total current liabilities
303,439
377,683

Total liabilities
303,439
377,683

Stockholders' Equity:
Common stock, $.10 par value
     Authorized 5,000,000 shares, Issued
     4,324,140 shares in 2013 and 2012,
     Outstanding 2,585,086 shares in 2013
     and 2,585,321 in 2012
432,414
432,414
Additional paid-in capital
3,248,706
3,248,706
Retained earnings (deficit)
(353,552)
232,013

Common stock in treasury, at cost
     1,739,054 shares in 2013 and 1,738,819
     shares in 2012
(1,691,616)
(1,691,472)

Total stockholders' equity
1,635,952
2,221,661

Total liabilities and stockholders' equity $
1,939,391 $
2,599,344

<FN>

See Accompanying Notes to Condensed Consolidated Financial Statements

<PAGE> 3

Microwave Filter Company and Subsidiaries

Condensed Consolidated Statements of Operations

(Unaudited)


		Three months ended
		December 31,
		2013		2012

Net sales	$	655,447	$	771,244

Cost of goods sold		456,913		568,044

Gross profit		198,534		203,200

Selling, general and
administrative expenses		366,547		430,415

Loss from operations		(168,013)		(227,215)

Other income (expense), net		(3,881)		2,190

Loss before income taxes		(171,894)		(225,025)

(Benefit) provision
for income taxes		0		0

Net loss	$	(171,894)	$	(225,025)

Net Loss Per Common Share
Basic and diluted earnings per share	$	(0.07)	$	(0.09)

Weighted Average Common Shares
Outstanding
Shares used in computing net
(loss) earnings per share:		2,585,086		2,585,321

Three months ended Nine months ended
June 30, June 30,
2013 2012 2013 2012

Net sales $
705,148 $
1,147,336 $
2,084,735 $
3,490,463

Cost of goods sold
439,440
713,193
1,484,560
2,215,494

Gross profit
265,708
434,143
600,175
1,274,969

Selling, general and
     administrative expenses
317,827
381,294
1,190,719
1,274,001

(Loss) income from operations
(52,119)
52,849
(590,544)
968

Other income (net)
1,579
2,027
4,979
26,673

(Loss) income
    before income taxes
(50,540)
54,876
(585,565)
27,641

(Benefit) provision
    for income taxes
0
(38,582)
0
(38,582)

Net (loss) income $
(50,540) $
93,458 $
(585,565) $
66,223

Net (Loss) Income Per Common Share
Basic and diluted earnings per share $
(0.02) $
0.04 $
(0.23) $
0.03

Weighted Average Common Shares
Outstanding
Shares used in computing net
     (loss) earnings per share:
2,585,156
2,585,569
2,585,243
2,586,008

<FN>

See Accompanying Notes to Condensed Consolidated Financial Statements

<PAGE> 4

Microwave Filter Company and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(Unaudited)

		Three months ended
		December 31
		2013		2012

Cash flows from operating activities:
Net loss	$	(171,894)	$	(225,025)

Adjustments to reconcile net loss
to net cash provided by
(used in) operating activities:
Depreciation		32,702		41,337
Change in operating assets and liabilities:
Accounts receivable-trade		53,916		100,422
Federal and state income
tax recoverable		37,085		0
Inventories		9,894		(23,962)
Prepaid expenses and other assets		(24,194)		12,456
Accounts payable and customer
deposits		76,021		32,126
Accrued payroll and related expenses
and compensated absences		3,725		(25,402)
Other current liabilities		475		(1,120)

Net cash provided by (used in)
operating activities		17,730		(89,168)

Cash flows from investing activities:
Property, plant and equipment purchased		(2,361)		(73,253)

Net cash used in investing activities		(2,361)		(73,253)

Cash flows from financing activities:
Repayment of note payable		(10,015)		0

Net cash used in financing activities		(10,015)		0

<PAGE> 6

Increase (decrease) in cash and
cash equivalents		5,354		(162,421)

Cash and cash equivalents
at beginning of period		939,959		1,023,017

Cash and cash equivalents
at end of period	$	945,313	$	860,596

Supplemental Schedule of Cash Flow Information:
Interest	$	5,575	$	0

Nine months ended
June 30
2013 2012

Cash flows from operating activities:
Net (loss) income $
(585,565) $
66,223

Adjustments to reconcile net (loss)
     income to net cash provided by
    (used in) operating activities:
Depreciation
125,167
117,172
Gain on sale of fixed assets
0
(20,000)
Change in operating assets and liabilities:
Accounts receivable-trade
35,136
38,096
Federal and state income
     tax recoverable
0
(13,754)
Inventories
(63,931)
69,231
Prepaid expenses and other assets
24,606
421
Accounts payable and customer
     deposits
(8,255)
(118,972)
Accrued payroll and related expenses
     and compensated absences
(63,546)
(65,091)
Other current liabilities
(2,443)
(52,740)

Net cash (used in) provided by
    operating activities
(538,831)
20,586

Cash flows from investing activities:
Property, plant and equipment purchased
(74,345)
(198,225)
Proceeds from sale of fixed assets
0
20,000

  Net cash used in investing activities
(74,345)
(178,225)

Cash flows from financing activities:
Purchase of treasury stock
(144)
(663)

  Net cash used in financing activities
(144)
(663)

Decrease in cash and cash equivalents
(613,320)
(158,302)

Cash and cash equivalents
      at beginning of period
1,023,017
1,258,885

Cash and cash equivalents
      at end of period $
409,697 $
1,100,583

Supplemental Schedule of Cash Flow Information:
     Income taxes paid $
0 $
15,000

<FN>

See Accompanying Notes to Condensed Consolidated Financial Statements

<PAGE> 5

MICROWAVE FILTER COMPANY, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~JUNE 30,~~

December 31, 2013

Note 1. Summary of Significant Accounting Policies

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Regulation S-K. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. The operating results for the ~~nine~~three month period ended ~~June 30,~~December 31, 2013 are not necessarily indicative of the results that may be expected for the year ended September 30, ~~2013.~~2014. For further information, refer to the condensed consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10K for the year ended September 30, ~~2012.~~

2013.

Note 2. Industry Segment Data

The Company's primary business segment involves the operations of Microwave Filter Company, Inc. (MFC) which designs, develops, manufactures and sells electronic filters, both for radio and microwave frequencies, to help process signal distribution and to prevent unwanted signals from disrupting transmit or receive operations. Markets served include cable television, television and radio broadcast, satellite broadcast, mobile radio, commercial communications and defense electronics.

Note 3. Inventories

Inventories are stated at the lower of cost determined on the first-in, first-out method or market.

Inventories net of reserve for obsolescence consisted of the following:


	December 31, 2013		September 30, 2013


Raw materials and stock parts	$	416,567	$	432,871
Work-in-process		26,589		24,137
Finished goods		113,450		109,492

	$	556,606	$	566,500

June 30, 2013 September 30, 2012

Raw materials and stock parts $
502,276 $
455,000
Work-in-process
16,011
13,554
Finished goods
74,719
60,521

$
593,006 $
529,075

The Company's reserve for obsolescence equaled ~~$373,171~~$400,664 at ~~June 30,~~December 31, 2013 and ~~$408,340~~$400,664 at September 30, ~~2012.~~2013. The Company provides for a valuation reserve for certain inventory that is deemed to be obsolete, of excess quantity or otherwise impaired. ~~The decrease of $35,169 in inventory reserve at June 30, 2013 can be attributed to the sale of inventory that had been reserved.~~

<PAGE> 6

Note 4. Income Taxes

The Company accounts for income taxes under FASB ASC 740-10. Deferred tax assets and liabilities are based on the difference between the financial statement and tax basis of assets and liabilities as measured by the enacted tax rates which are anticipated to be in effect when these differences reverse. The deferred tax provision is the result of the net change in the deferred tax assets and liabilities. A valuation allowance is established when it is necessary to reduce deferred tax assets to amounts expected to be realized. The Company has provided a full valuation allowance against its deferred tax assets.

The Company adopted FASB ASC 740-10. FASB ASC 740-10 clarifies the accounting for uncertainty in income taxes recognized in an ~~entity’s~~entity's financial statements and prescribes a recognition threshold and measurement attributes for financial statement disclosure of tax position taken or expected to be taken on a tax return. Additionally, it provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. The Company determined it has no uncertain tax positions and therefore no amounts are recorded.

Note 5. Legal Matters

The State of New York ~~Workers’~~Workers' Compensation Board has commenced an action against Microwave Filter Company, Inc. to recover for an underfunded self insured program that Microwave Filter Company, Inc. participated in. Due to the relatively short period of time Microwave Filter Company, Inc. participated in the program and the limited amount of potential exposure, we do not expect the resolution of this action will have a material adverse effect on our financial condition, results of operations or cash flows. The Company has accrued $12,000 for this action in other current liabilities.

Note 6. Fair Value of Financial Instruments

The carrying values of the Company cash and cash equivalents, accounts receivable and accounts payable approximate fair value because of the short maturity of those instruments.

The Company currently does not trade in or utilize derivative financial instruments.

Note 7. Significant Customers

Sales to one customer represented approximately ~~17%~~10% of total sales for the ~~nine~~three months ended ~~June 30,~~December 31, 2013 compared to approximately ~~20%~~22% of total sales for the ~~nine~~three months ended ~~June 30,~~December 31, 2012.

<PAGE> 7

Note 8. ~~Subsequent Event~~

Notes Payable

On July 2, 2013, Microwave Filter Company, Inc. (the ~~“Company”~~"Company") entered into a Ten Year Term Loan with KeyBank National Association in the amount of Five Hundred Thousand and No/100 Dollars ($500,000.00). The amount of all advances outstanding together with accrued interest thereon shall be due and payable on July 2, 2023 ~~(“Maturity”~~("Maturity"). The Company shall pay interest on the outstanding principal balance of this Note at the rate per annum equal to 4.5%. The net proceeds from the Term Loan will be available to provide working capital as needed.

The total amount outstanding as of December 31, 2013 and 2012 was $483,453 and $0, respectively. Interest accrued as of December 31, 2013 and 2012 was $1,749 and $0, respectively.

The Company has secured this Note by: (a) a Mortgage, Assignment of Rents, Security Agreement and Fixture Filing which creates a 1^st lien on real property situated in the Town of Dewitt, County of Onondaga, and State of New York and known as 6743 Kinne Street, East Syracuse, New York; (b) a General Assignment of Rents and Leases; (c) an Environmental Compliance and Indemnification; and (d) such other security as may now or hereafter ~~b e~~be given to Lender as collateral for the loan.

Note 9. Credit Facilities

The Company has unused aggregate lines of credit totaling $750,000 collateralized by inventory, equipment and accounts receivable. The variable interest rate is the "prime rate" as published each business day in the "Money Rates" column of the Wall Street Journal.

Note 9.10. Recent Accounting Pronouncements

None applicable.

<PAGE> 8

MICROWAVE FILTER COMPANY, INC.

MANAGEMENT'S DISCUSSION AND

ANALYSIS OF FINANCIAL CONDITION AND

RESULTS OF OPERATIONS

Microwave Filter Company, Inc. operates primarily in the United States and principally in one industry. The Company extends credit to business customers based upon ongoing credit evaluations. Microwave Filter Company, Inc. (MFC) designs, develops, manufactures and sells electronic filters, both for radio and microwave frequencies, to help process signal distribution and to prevent unwanted signals from disrupting transmit or receive operations. Markets served include cable television, television and radio broadcast, satellite broadcast, mobile radio, commercial communications and defense electronics.

Critical Accounting Policies

The Company's condensed consolidated financial statements are based on the application of United States generally accepted accounting principles (GAAP). GAAP requires the use of estimates, assumptions, judgments and subjective interpretations of accounting principles that have an impact on the assets, liabilities, revenue and expense amounts reported. The Company believes its use of estimates and underlying accounting assumptions adhere to GAAP and are consistently applied. Valuations based on estimates are reviewed for reasonableness and adequacy on a consistent basis throughout the Company. Primary areas where financial information of the Company is subject to the use of estimates, assumptions and the application of judgment include revenues, receivables, inventories, and taxes. Note 1 to the ~~condensed~~ consolidated financial statements in our Annual Report on Form 10-K for the fiscal year ended September 30, ~~2012~~2013 describes the significant accounting policies used in preparation of the condensed consolidated financial statements. The most significant areas involving management judgments and estimates are described below and are considered by management to be critical to understanding the financial condition and results of operations of the Company.

Revenues from product sales are recorded as the products are shipped and title and risk of loss have passed to the customer, provided that no significant vendor or post-contract support obligations remain and the collection of the related receivable is probable. Billings in advance of the Company's performance of such work are reflected as customer deposits in the accompanying condensed consolidated balance sheet.

Allowances for doubtful accounts are based on estimates of losses related to customer receivable balances. The establishment of reserves requires the use of judgment and assumptions regarding the potential for losses on receivable balances.

The Company's inventories are stated at the lower of cost determined on the first-in, first-out method or market. The Company uses certain estimates and judgments and considers several factors including product demand and changes in technology to provide for excess and obsolescence reserves to properly value inventory.

<PAGE> 9

The Company established a warranty reserve which provides for the estimated cost of product returns based upon historical experience and any known conditions or circumstances. Our warranty obligation is affected by product that does not meet specifications and performance requirements and any related costs of addressing such matters.

The Company accounts for income taxes under FASB ASC 740-10. Deferred tax assets and liabilities are based on the difference between the financial statement and tax basis of assets and liabilities as measured by the enacted tax rates which are anticipated to be in effect when these differences reverse. The deferred tax provision is the result of the net change in the deferred tax assets and liabilities. A valuation allowance is established when it is necessary to reduce deferred tax assets to amounts expected to be realized. The Company has provided a full valuation allowance against its deferred tax assets.

<PAGE> 10

RESULTS OF OPERATIONS

THREE MONTHS ENDED ~~JUNE 30,~~December 31, 2013 vs. THREE MONTHS ENDED ~~JUNE 30,~~December 31, 2012

The following table sets forth the Company's net sales by major product group for the three months ended ~~June 30,~~December 31, 2013 and 2012.



Product group	Fiscal 2014		Fiscal 2013
Microwave Filter (MFC):
RF/Microwave	$	241,349	$	324,127
Satellite		305,626		243,130
Cable TV		84,685		183,390
Broadcast TV		21,582		18,627
Niagara Scientific (NSI):		2,205		1,970

Total	$	655,447	$	771,244

Sales backlog at December 31	$	1,331,100	$	352,852

Product group Fiscal 2013 Fiscal 2012
Microwave Filter (MFC):
     RF/Microwave $
243,621 $
412,104
     Satellite
245,303
326,759
     Cable TV
152,314
370,369
     Broadcast TV
62,528
37,394
Niagara Scientific (NSI):
1,382
710

Total $
705,148 $
1,147,336

Sales backlog at June 30 $
262,690 $
394,680

Net sales for the three months ended ~~June 30,~~December 31, 2013 equaled ~~$705,148~~$655,447 a decrease of ~~$442,188~~$115,797 or ~~38.5%~~15%, when compared to net sales of ~~$1,147,336~~$771,244 for the three months ended ~~June 30,~~December 31, 2012. Net sales have been decreasing since the quarter ended June 30, 2012. It is difficult to determine precisely the cause of this systemic erosion in sales but it is conjectured that the fear engendered by the sequester of budgetary funds for the Defense Department has had a major impact on ~~MFC’s~~MFC's economic environment. It should be remembered that substantial Defense cuts occurred during FY 2012 which have affected the whole communications market place as suppliers to the Defense industry have made the commercial market place more competitive as they have sought to redirect their sales efforts away from Defense. Management also believes that the decrease in capital expenditures from non-defense oriented companies (such as Cable Television companies) has also contributed to the overall decline and demand across all market segments served by MFC. In order to mitigate the effects of this decline in demand for our products during this difficult period, management has adopted a plan of cost reduction, as well as, an accelerated development and acquisition of new products. This coupled with an increase in promotional activity for existing and new products will hopefully mitigate the systemic effects of the market place by allowing MFC to increase its market share by virtue of a plethora of products for a wider range of applications and for a larger customer segment. The Company did receive a $1,157,072 order from a large OEM during the quarter ended December 31, 2013 with shipments beginning in February 2014 and ending in December 2014. Management is hopeful that this order will be part of a sustained increase in sales orders.

<PAGE> 13

~~MFC’s~~

MFC's RF/Microwave product sales decreased ~~$168,483~~$82,778 or ~~40.9%~~25.5% to ~~$243,621~~$241,349 for the three months ended ~~June 30,~~December 31, 2013 when compared to RF/Microwave product sales of ~~$412,104~~$324,127 during the same period last year. ~~MFC’s~~MFC's RF/Microwave products are sold primarily to Original Equipment Manufacturers that serve the mobile radio, commercial communications and defense electronics markets. The Company continues to invest in production engineering and infrastructure development to penetrate OEM market segments as they become popular. MFC is concentrating its technical resources and product development efforts toward potential high volume customers as part of a concentrated effort to provide substantial long-term growth. Sales to one OEM customer represented approximately ~~22%~~10% of total sales for both the three months ended ~~June 30,~~December 31, 2013 and ~~June 30, 2012.~~

~~<PAGE> 11~~

~~MFC’s Satellite product~~approximately 22% of total sales ~~decreased $81,456 or 24.9% to $245,303~~ for the three months ended ~~June 30,~~December 31, 2012.

MFC's Satellite product sales increased $62,496 or 25.7% to $305,626 for the three months ended December 31, 2013 when compared to Satellite product sales of ~~$326,759~~$243,130 during the same period last year. The ~~decrease~~increase can be attributed to ~~a decrease~~an increase in demand for the Company's filters which suppress strong out-of-band interference caused by military and civilian radar systems and other sources. Although economic conditions do impact sales, management expects demand for these types of filters to continue with the proliferation of earth stations world wide and increased sources of interference.

~~MFC’s~~

MFC's Cable TV product sales decreased ~~$218,055~~$98,705 or ~~58.9%~~53.9% to ~~$152,314~~$84,685 for the three months ended ~~June 30,~~December 31, 2013 when compared to Cable TV product sales of ~~$370,369~~$183,390 during the same period last year. Management continues to project a decrease in demand for Cable TV products due to the shift from analog to digital television. Due to the inherent nature of digital modulation versus analog modulation, fewer filters will be required. The Company has developed filters for digital television and there will still be requirements for analog filters for limited applications in commercial and private cable systems. Management also believes that the decrease in capital expenditures from non-defense oriented companies (such as Cable Television companies) has also contributed to the decline in sales.

~~MFC’s~~

MFC's Broadcast TV/Wireless Cable product sales increased ~~$25,134~~$2,955 to ~~$62,528~~$21,582 for the three months ended ~~June 30,~~December 31, 2013 when compared to sales of ~~$37,394~~$18,627 during the same period last year. The increase can be attributed to an increase in demand for UHF Broadcast products which are primarily sold to system integrators for rural communities.

MFC's sales order backlog equaled ~~$262,690~~$1,331,100 at ~~June 30,~~December 31, 2013 compared to sales order backlog of ~~$394,680~~$352,852 at ~~June 30,~~December 31, 2012. The increase can primarily be attributed to a large OEM order received during the quarter ended December 31, 2013. However, backlog is not necessarily indicative of future sales. Accordingly, the Company does not believe that its backlog as of any particular date is representative of actual sales for any succeeding period. Approximately ~~73%~~78% of the total sales order backlog at ~~June 30,~~December 31, 2013 is scheduled to ship by September 30, ~~2013.~~
2014.
.

Gross profit for the three months ended ~~June 30,~~December 31, 2013 equaled ~~$265,708,~~$198,534, a decrease of ~~$168,435~~$4,666 or ~~38.8%~~2.3%, when compared to gross profit of ~~$434,143~~$203,200 for the three months ended ~~June 30,~~December 31, 2012. The dollar decrease in gross profit can primarily be attributed to the lower sales volume this year when compared to the same period last year. As a percentage of sales, gross profit equaled ~~37.7%~~30.3% for the three months ended ~~June 30,~~December 31, 2013 compared to ~~37.8%~~26.3% for the three months ended ~~June 30,~~December 31, 2012. The improvement in gross profit as a percentage of sales can primarily be attributed to lower material costs due to product sales mix.

<PAGE> 14

Selling, general and administrative (SGA) expenses for the three months ended ~~June 30,~~December 31, 2013 equaled ~~$317,827,~~$366,547, a decrease of ~~$63,467~~$63,868 or ~~16.6%~~14.8%, when compared to SGA expenses of ~~$381,294~~$430,415 for the three months ended ~~June 30,~~December 31, 2012. The decrease can primarily be attributed to lower payroll and payroll related expenses. The Company has been participating in the New York State Shared Work program which allows employers to reduce the hours of all or a particular group of employees. The employees whose hours are reduced can receive partial unemployment insurance benefits or elect to use accrued vacation. As a percentage of sales, SGA expenses ~~increased to 45.1%~~equaled 55.9% for the three months ended ~~June 30,~~December 31, 2013 ~~when~~ compared to ~~33.2%~~55.8% for the three months ended ~~June 30, 2012~~December 31, 2012.

The Company recorded a loss from operations of $168,013 for the three months ended December 31, 2013 compared to a loss from operations of $227,215 for the three months ended December 31, 2012. The improvement can primarily ~~due~~be attributed to the lower ~~sales volume~~SGA expenses this year when compared to the same period last year.

~~The Company recorded a loss from operations~~

Other income (expense) was an expense of ~~$52,119~~$3,881 for the three months ended ~~June 30,~~December 31, 2013 compared to income ~~from operations~~ of ~~$52,849~~$2,190 for the for the three months ended ~~June 30, 2012. The decrease in operating income can~~December 31, 2012 primarily ~~be attributed~~due to interest expense of $5,598 for the ~~lower sales volume this year when compared to~~three months ended December 31, 2013 and $0 for the same period last year.

~~<PAGE> 12~~

The (benefit) provision for income taxes equaled $0 for the three months ended ~~June 30,~~December 31, 2013 and ~~June 30,~~December 31, 2012. We have not recognized any (benefit) provision for income taxes. Any benefit for losses has been subject to a valuation allowance since the realization of the deferred tax benefit is not considered more likely than not. As required by FASB ASC 740 (Prior Authoritative Literature: SFAS 109, Accounting for Income Taxes), the Company has evaluated the positive and negative evidence bearing upon the realization of its deferred tax assets. The Company has determined that, at this time, it is more likely than not that the Company will not realize all of the benefits of federal and state deferred tax assets, and, as a result, a valuation allowance was established.

~~NINE MONTHS ENDED JUNE 30, 2013 vs. NINE MONTHS ENDED JUNE 30, 2012~~

~~The following table sets forth the Company's net sales by major product group for the nine months ended June 30, 2013 and 2012.~~

Product group Fiscal 2013 Fiscal 2012
Microwave Filter (MFC):
     RF/Microwave $
759,027 $
1,307,148
     Satellite
768,055
1,029,089
     Cable TV
432,896
1,051,438
     Broadcast TV
119,244
98,344
Niagara Scientific (NSI):
5,513
4,444

Total $
2,084,735 $
3,490,463

Sales backlog at June 30 $
262,690 $
394,680

Net sales for the nine months ended June 30, 2013 equaled $2,084,735, a decrease of $1,405,728 or 40.3%, when compared to net sales of $3,490,463 for the nine months ended June 30, 2012. Net sales have been decreasing since the quarter ended June 30, 2012. It is difficult to determine precisely the cause of this systemic erosion in sales but it is conjectured that the fear engendered by the sequester of budgetary funds for the Defense Department has had a major impact on MFC’s economic environment. It should be remembered that substantial Defense cuts occurred during FY 2012 which have affected the whole communications market place as suppliers to the Defense industry have made the commercial market place more competitive as they have sought to redirect their sales efforts away from Defense. Management also believes that the decrease in capital expenditures from non-defense oriented companies (such as Cable Television companies) has also contributed to the overall decline and demand across all market segments served by MFC. In order to mitigate the effects of this decline in demand for our products during this difficult period, management has adopted a plan of cost reduction, as well as, an accelerated development and acquisition of new products. This coupled with an increase in promotional activity for existing and new products will hopefully mitigate the systemic effects of the market place by allowing MFC to increase its market share by virtue of a plethora of products for a wider range of applications and for a larger customer segment.

~~<PAGE> 13~~

MFC’s RF/Microwave product sales decreased $548,121 or 41.9% to $759,027 for the nine months ended June 30, 2013 when compared to RF/Microwave product sales of $1,307,148 during the same period last year. MFC’s RF/Microwave products are sold primarily to Original Equipment Manufacturers that serve the mobile radio, commercial communications and defense electronics markets. The Company continues to invest in production engineering and infrastructure development to penetrate OEM market segments as they become popular. MFC is concentrating its technical resources and product development efforts toward potential high volume customers as part of a concentrated effort to provide substantial long-term growth. Sales to one OEM customer represented approximately 17% of total sales for the nine months ended June 30, 2013 compared to approximately 20% of total sales for the nine months ended June 30, 2012.

MFC’s Satellite product sales decreased $261,034 or 25.4% to $768,055 for the nine months ended June 30, 2013 when compared to satellite product sales of $1,029,089 during the same period last year. The decrease can be attributed to a decrease in demand for the Company’s filters which suppress strong out-of-band interference caused by military and civilian radar systems and other sources. Although economic conditions do impact sales, management expects demand for these types of filters to continue with the proliferation of earth stations world wide and increased sources of interference.

MFC’s Cable TV product sales decreased $618,542 or 58.8% to $432,896 for the nine months ended June 30, 2013 when compared to Cable TV product sales of $1,051,438 during the same period last year. Management continues to project a decrease in demand for Cable TV products due to the shift from analog to digital television. Due to the inherent nature of digital modulation versus analog modulation, fewer filters will be required. The Company has developed filters for digital television and there will still be requirements for analog filters for limited applications in commercial and private cable systems. Management also believes that the decrease in capital expenditures from non-defense oriented companies (such as Cable Television companies) has also contributed to the decline in sales.

~~MFC’s Broadcast TV/Wireless Cable product sales increased $20,900 or 2~~1.3% to $119,244 for the nine months ended June 30, 2013 when compared to sales of $98,344 during the same period last year. The increase can be attributed to an increase in demand for UHF Broadcast products which are primarily sold to system integrators for rural communities.

Gross profit for the nine months ended June 30, 2013 equaled $600,175, a decrease of $674,794 or 52.9%, when compared to gross profit of $1,274,969 for the nine months ended June 30, 2012. The decrease can primarily be attributed to the lower sales volume this year when compared to the same period last year. As a percentage of sales, gross profit equaled to 28.8% for the nine months ended June 30, 2013 compared to 36.5% for the nine months ended June 30, 2012. The decrease in gross profit as a percentage of sales can primarily be attributed to the lower sales volume this year providing a lower base to absorb fixed expenses.

SG&A expenses for the nine months ended June 30, 2013 equaled $1,190,719 a decrease of $83,282 or 6.5%, when compared to SG&A expenses of $1,274,001 for the nine months ended June 30, 2012. As a percentage of sales, SGA expenses increased to 57.1% for the nine months ended June 30, 2013 compared to 36.5% for the nine months ended June 30, 2012 primarily due to the lower sales volume this year when compared to the same period last year.

~~<PAGE> 14~~

The Company recorded a loss from operations of $590,544 for the nine months ended June 30, 2013 compared to income from operations of $968 for the nine months ended June 30, 2012. The decrease in operating income can primarily be attributed to the lower sales volume this year when compared to the same period last year.

Other income for the nine months ended June 30, 2013 equaled $4,979, a decrease of $21,694 when compared to other income of $26,673 for the nine months ended June 30, 2012. The decrease can be attributed to a $20,000 gain on the sale of a fixed asset last year.

The (benefit) provision for income taxes equaled $0 for the nine months ended June 30, 2013 and June 30, 2012. We have not recognized any (benefit) provision for income taxes. Any benefit for losses has been subject to a valuation allowance since the realization of the deferred tax benefit is not considered more likely than not. As required by FASB ASC 740 (Prior Authoritative Literature: SFAS 109, Accounting for Income Taxes), the Company has evaluated the positive and negative evidence bearing upon the realization of its deferred tax assets. The Company has determined that, at this time, it is more likely than not that the Company will not realize all of the benefits of federal and state deferred tax assets, and, as a result, a valuation allowance was established.

Off-Balance Sheet Arrangements

At ~~June 30,~~December 31, 2013 and 2012, the Company did not have any unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities, which might have been established for the purpose of facilitating off-balance sheet arrangements.

<PAGE> 15

LIQUIDITY and CAPITAL RESOURCES



	December 31, 2013	September 30, 2013

Cash & cash equivalents	$945,313	$939,959
Working capital	$1,390,032	$1,542,065
Current ratio	4.64 to 1	6.11 to 1
Long-term debt	$442,291	$452,771

June 30, 2013 September 30, 2012

Cash & cash equivalents $409,697 $1,023,017
Working capital $1,014,249 $1,549,136
Current ratio 4.34 to 1 5.10 to 1
Long-term debt $0 $0

Cash and cash equivalents ~~decreased $613,320~~increased $5,354 to ~~$409,697~~$945,313 at ~~June 30,~~December 31, 2013 when compared to cash and cash equivalents of ~~$1,023,017~~$939,959 at September 30, ~~2012.~~2013. The ~~decrease~~increase was a result of ~~$538,831~~$17,730 in net cash ~~used in~~provided by operating activities, ~~primarily due to the net loss, $74,345~~$2,361 in net cash used for capital expenditures and ~~$144~~$10,015 in net cash used for repayment of a note payable. The increase of $17,730 in net cash provided by operating activities can primarily be attributed to ~~purchase treasury stock.~~

favorable changes in operating assets and liabilities.

The ~~decrease~~decreases in accounts receivable of ~~$35,136~~$53,916 and the federal and state income tax recoverable of $37,085 at ~~June 30,~~December 31, 2013 when compared to September 30, ~~2012~~2013 can ~~primarily~~ be attributed to ~~the decrease in sales for the month ended June 30, 2013 when compared to the month ended September 30, 2012.~~

timely collections. The increase in ~~inventories~~accounts payable of ~~$63,931~~$49,962 at ~~June 30,~~December 31, 2013 when compared to September 30, ~~2012~~2013 can be attributed to the ~~addition~~timing of ~~new products, prior purchase commitments~~purchases and ~~lower than expected sales orders.~~

~~The decrease in accrued compensated absences of $54,630 at June 30, 2013 when compared~~payments to September 30, 2012 can be attributed to accrued vacation used during the nine months ended June 30, 2013. Due to the lower sales volume, the Company has been participating in the New York State Shared Work program which allows employers to reduce the hours of all or a particular group of employees. The employees whose hours are reduced can receive partial unemployment insurance benefits or elect to use accrued vacation.

vendors.

At ~~June 30,~~December 31, 2013, the Company had unused aggregate lines of credit totaling $750,000 collateralized by all inventory, equipment and accounts receivable.

~~Management~~

Despite the losses incurred during Fiscal 2013 and the first quarter of Fiscal 2014, management believes that its working capital requirements for the forseeable future will be met by its existing cash balances, future cash flows from operations and its current credit arrangements.

The Company has seen a significant increase in backlog due to a substantial order received during the quarter ended December 31, 2013.

<PAGE> 16

SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

In an effort to provide investors a balanced view of the Company's current condition and future growth opportunities, this Quarterly Report on Form 10-Q includes comments by the Company's management about future performance. These statements which are not historical information are "forward-looking statements" pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These, and other forward-looking statements, are subject to business and economic risks and uncertainties that could cause actual results to differ materially from those discussed. These risks and uncertainties include, but are not limited to: risks associated with demand for and market acceptance of existing and newly developed products as to which the Company has made significant investments; general economic and industry conditions; slower than anticipated penetration into the satellite communications, mobile radio and commercial and defense electronics markets; competitive products and pricing pressures; increased pricing pressure from our customers; risks relating to governmental regulatory actions in broadcast, communications and defense programs; as well as other risks and uncertainties, including but not limited to those detailed from time to time in the Company's Securities and Exchange Commission filings. These forward-looking statements are made only as of the date hereof, and the Company undertakes no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise. You are encouraged to review Microwave Filter ~~Company’s 2012~~Company's 2013 Annual Report and Form 10-K for the fiscal year ended September 30, ~~2012~~2013 and other Securities and Exchange Commission filings. Forward looking statements may be made directly in this document or ~~“incorporated~~"incorporated by ~~reference”~~reference" from other documents. You can find many of these statements by looking for words like ~~“believes,” “expects,” “anticipates,” “estimates,”~~"believes," "expects," "anticipates," "estimates," or similar expressions.

<PAGE> 17

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

~~There has been no significant change in our exposures~~

As a "smaller reporting company" we are not required to market risk during the nine months ended June 30, 2013. For a detailed discussion of market risk, see our Annual Report on Form 10-K for the fiscal year ended September 30, 2012, Part II, Item 7A, Quantitative and Qualitative Disclosures About Market Risk.

~~<PAGE> 17~~

provide information required by this item.

ITEM 4. CONTROLS AND PROCEDURES

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

The ~~Company’s~~Company's management, with the participation of the ~~Company’s~~Company's Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the ~~Company’s~~Company's disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the ~~“Exchange Act”~~"Exchange Act")) as of the end of the period covered by this report. Based on such evaluation, the ~~Company’s~~Company's Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of such period, the ~~Company’s~~Company's disclosure controls and procedures were effective as of the end of the period covered by this report.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

There have been no changes in the ~~Company’s~~Company's internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, the ~~Company’s~~Company's internal control over financial reporting.

<PAGE> 18

                     PART II - OTHER INFORMATION

Item 1. Legal Proceedings

         The State of New York ~~Workers’~~Workers' Compensation Board has commenced an action

         against Microwave Filter Company, Inc. to recover for an underfunded self

         insured program that Microwave Filter Company, Inc. participated in.

         Due to the relatively short period of time Microwave Filter Company, Inc.

         participated in the program and the limited amount of potential exposure,

         we do not expect the resolution of this action will have a material adverse

         effect on our financial condition, results of operations or cash flows.

         The Company has accrued $12,000 for this action in other current liabilities.

Item 1A. Risk Factors

         Not applicable.

Item 2. Changes in Securities

         None during this reporting period.

Item 3. Defaults Upon Senior Securities

         The Company has no senior securities.

Item 4. Mine Safety Disclosures


          Not applicable.

Item 5. Other Information

         None.

Item 6. Exhibits

         a. Exhibits

            31.1 Section 13a-14(a)/15d-14(a) Certification of Carl F. Fahrenkrug

            31.2 Section 13a-14(a)/15d-14(a) Certification of Richard L. Jones

            32.1 Section 1350 Certification of Carl F. Fahrenkrug

            32.2 Section 1350 Certification of Richard L. Jones

<PAGE> 19

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

                               MICROWAVE FILTER COMPANY, INC.

~~August~~

February 13,~~, 2013~~ 2014         Carl F. Fahrenkrug

(Date)                          --------------------------

                                Carl F. Fahrenkrug

                                    Chief Executive Officer

~~August~~

February 13, ~~2013~~2014          Richard L. Jones

(Date)                               --------------------------

                                         Richard L. Jones

                                         Chief Financial Officer

<PAGE> 20


New York		16-0928443
(State of Incorporation)		(I.R.S. Employer Identification Number)

6743 Kinne Street, East Syracuse, N.Y.		13057
(Address of Principal Executive Offices)		(Zip Code)


Item	Page

Part I Financial Information

Item 1. Financial Statements	3

Condensed Consolidated Balance Sheets (unaudited)	3

Condensed Consolidated Statements of Operations (unaudited)	45

Condensed Consolidated Statements of Cash Flows (unaudited)	56

Notes to Condensed Consolidated Financial Statements (unaudited)	6-8 8-10

Item 2. ~~Management’s~~Management's Discussion and Analysis of Financial Condition and Results of Operations	9~~-16~~ 11-17

Item 3. Quantitative and Qualitative Disclosures About Market Risk	1718

Item 4. Controls and Procedures	18

Part II Other Information	19

Signatures	20


	June 30, 2013			September 30, 2012

Assets
Current Assets:
Cash and cash equivalents		$	409,697		$	1,023,017
Accounts receivable-trade, net of
allowance for doubtful accounts
of $26,000 and $26,000			228,249			263,385
Inventories, net			593,006			529,075
Prepaid expenses and other current assets			86,736			111,342

Total current assets			1,317,688			1,926,819

Property, plant and equipment, net			621,703			672,525

Total assets		$	1,939,391		$	2,599,344


Liabilities and Stockholders' Equity

Current liabilities:
Accounts payable		$	84,926		$	92,325
Customer deposits			29,707			30,563
Accrued payroll and related expenses			42,373			51,289
Accrued compensated absences			117,568			172,198
Other current liabilities			28,865			31,308

Total current liabilities			303,439			377,683

Total liabilities			303,439			377,683

Stockholders' Equity:
Common stock, $.10 par value
Authorized 5,000,000 shares, Issued
4,324,140 shares in 2013 and 2012,
Outstanding 2,585,086 shares in 2013
and 2,585,321 in 2012			432,414			432,414
Additional paid-in capital			3,248,706			3,248,706
Retained earnings (deficit)			(353,552)			232,013

Common stock in treasury, at cost
1,739,054 shares in 2013 and 1,738,819
shares in 2012			(1,691,616)			(1,691,472)

Total stockholders' equity			1,635,952			2,221,661

Total liabilities and stockholders' equity		$	1,939,391		$	2,599,344


		Three months ended				Nine months ended
		June 30,				June 30,
		2013		2012		2013		2012

Net sales	$	705,148	$	1,147,336	$	2,084,735	$	3,490,463

Cost of goods sold		439,440		713,193		1,484,560		2,215,494

Gross profit		265,708		434,143		600,175		1,274,969

Selling, general and
administrative expenses		317,827		381,294		1,190,719		1,274,001

(Loss) income from operations		(52,119)		52,849		(590,544)		968

Other income (net)		1,579		2,027		4,979		26,673

(Loss) income
before income taxes		(50,540)		54,876		(585,565)		27,641

(Benefit) provision
for income taxes		0		(38,582)		0		(38,582)

Net (loss) income	$	(50,540)	$	93,458	$	(585,565)	$	66,223

Net (Loss) Income Per Common Share
Basic and diluted earnings per share	$	(0.02)	$	0.04	$	(0.23)	$	0.03

Weighted Average Common Shares
Outstanding
Shares used in computing net
(loss) earnings per share:		2,585,156		2,585,569		2,585,243		2,586,008



		Nine months ended
		June 30
		2013		2012

Cash flows from operating activities:
Net (loss) income	$	(585,565)	$	66,223

Adjustments to reconcile net (loss)
income to net cash provided by
(used in) operating activities:
Depreciation		125,167		117,172
Gain on sale of fixed assets		0		(20,000)
Change in operating assets and liabilities:
Accounts receivable-trade		35,136		38,096
Federal and state income
tax recoverable		0		(13,754)
Inventories		(63,931)		69,231
Prepaid expenses and other assets		24,606		421
Accounts payable and customer
deposits		(8,255)		(118,972)
Accrued payroll and related expenses
and compensated absences		(63,546)		(65,091)
Other current liabilities		(2,443)		(52,740)

Net cash (used in) provided by
operating activities		(538,831)		20,586

Cash flows from investing activities:
Property, plant and equipment purchased		(74,345)		(198,225)
Proceeds from sale of fixed assets		0		20,000

Net cash used in investing activities		(74,345)		(178,225)

Cash flows from financing activities:
Purchase of treasury stock		(144)		(663)

Net cash used in financing activities		(144)		(663)

Decrease in cash and cash equivalents		(613,320)		(158,302)

Cash and cash equivalents
at beginning of period		1,023,017		1,258,885

Cash and cash equivalents
at end of period	$	409,697	$	1,100,583

Supplemental Schedule of Cash Flow Information:
Income taxes paid	$	0	$	15,000



Product group	Fiscal 2013		Fiscal 2012
Microwave Filter (MFC):
RF/Microwave	$	243,621	$	412,104
Satellite		245,303		326,759
Cable TV		152,314		370,369
Broadcast TV		62,528		37,394
Niagara Scientific (NSI):		1,382		710

Total	$	705,148	$	1,147,336

Sales backlog at June 30	$	262,690	$	394,680