Technology Research Corp · 10-K405 · For 3/31/98

Filed On 6/29/98   ·   SEC File 0-13763   ·   Accession Number 741556-98-7

Annual Report -- [X] Reg. S-K Item 405   ·   Form 10-K
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-K405     Annual Report -- [X] Reg. S-K Item 405                41±   192K 
 2: EX-23       Exhibit (23)(A)                                        1      6K 
 3: EX-27       Article 5 FDS for Fiscal Year 1998 10-K                1      6K 

10-K405   ·   Annual Report -- [X] Reg. S-K Item 405
Document Table of Contents

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

     FORM 10-K

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

    For the fiscal year ended March 31, 1998

  Commission file number 0-13763

   TECHNOLOGY RESEARCH CORPORATION
    (Exact name of registrant as specified in its charter)

        Florida                                             59-2095002
(State or other jurisdiction of                            (I.R.S. Employer     
incorporation or Organization)                         Identification No.)    

5250   140th Avenue North,   Clearwater,  Florida                     33760     
(Address of principal executive offices)                         (Zip Code)     

Registrant's telephone number, including area code:  (813) 535-0572             

Securities registered pursuant to Section 12(b) of the Act:                     

                                           Name of each exchange
        Title of each class                  on which registered

        None                                  None

Securities registered pursuant to Section 12(g) of the Act:                     

   Common Stock $.51 par value
  (Title of Class)

Indicate by check mark whether the registrant (1) has filed all reports         
required to be filed by Section 13 or 15(d) of the Securities Exchange Act      
of 1934 during the preceding 12 months (or for such shorter period that the     
registrant was required to file such reports), and (2) has been subject to      
such filing requirements for the past 90 days. Yes [X] No [ ]                   

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

As of May 29, 1998, the number of shares outstanding of the registrant's        
common stock, $.51 par value was 5,400,253, and based on the closing sale       
price on such date, the aggregate market value of the voting stock held by      
nonaffiliates of the registrant was $10,506,342.                                

Part III of this Form 10-K is incorporated by reference from the registrant's   
Proxy Statement for the Annual Meeting of Shareholders to be held on August     
20, 1998.                                                                       

TABLE OF CONTENTS 

PART I                                                                Page      

Item 1.  Business  ....................................................  3      
Item 2.  Properties  .................................................. 12      
Item 3.  Legal Proceedings  ........................................... 12      
Item 4.  Submission of Matters to a Vote of Security Holders  ..........12      

PART II                                                                         

Item 5.  Market for Registrant's Common Equity and                              
   Related Stockholder Matters  ................................. 13
Item 6.  Selected Financial Data  ..................................... 14      
Item 7.  Management's Discussion and Analysis of Financial                      
   Condition and Results of Operations  ......................... 15
Item 8.  Financial Statements and Supplementary Data  ................. 20      
Item 9.  Changes in and Disagreements with Accountants                          
   on Accounting and Financial Disclosure  ...................... 20

PART III                                                                        

Item 10. Directors and Executive Officers of the Registrant  .......... 20      
Item 11. Executive Compensation  ...................................... 20      
Item 12. Security Ownership of Certain Beneficial                               
   Owners and Management  ....................................... 20
Item 13. Certain Relationships and Related Transactions  .............. 20      

PART IV                                                                         

Item 14. Exhibits, Financial Statements Schedules,                              
   and Reports on Form 8-K  ..................................... 20

SIGNATURES  ........................................................... 23      

  Part I

ITEM 1.  BUSINESS                                                               

General                                                                         

The Company was incorporated in Florida in June 1981 with the intended          
purpose of pursuing orders for products to be designed and manufactured for     
sale to the military engine generator set controls market, a segment with       
respect to which the Company's founders had acquired substantial experience.    

The Company currently designs, develops, manufactures and markets electronic    
control and measurement devices related to the distribution of electrical power 
and specializes in electrical safety products that prevent electrical fires     
and protect against electrocution and serious injury from electrical shock.     
Such products include ground fault protective devices, fire prevention devices  
for fires caused by aging appliance and extension cords, controls for           
electrical power generating systems, transformers and magnetics.  These         
products are used in providing safe and efficient utilization and controlled    
distribution of electricity and have consumer, commercial and governmental      
applications in the United States and throughout the world.                     

Until the year ended March 31, 1989, a majority of the Company's revenues       
were derived from sales of military products.  The Company believes that its    
successful design of ground fault devices for both personnel and equipment      
protection as well as meeting electrical safety requirements for personal       
care products, have formed the basis for the Company's success in the           
consumer/commercial, non-military markets.                                      

Net sales contributed by commercial and military products are as follows:       

Year Ended                                                                      
March 31    Commercial      %          Military      %            Total       
--------    ----------     ----        --------     ----          -----       
1998   $ 13,434,352     74.2     $ 4,667,433     25.8     $ 18,101,785  
1997     12,803,181     85.3       2,200,413     14.7       15,003,594  
1996     14,541,301     87.7       2,040,000     12.3       16,581,301  
1995     18,095,134     86.4       2,840,423     13.6       20,935,557  
1994     14,022,113     71.2       5,681,341     28.8       19,703,454  

Royalties from license agreements are as follows:                               

Year Ended                              
March 31           Royalties          
--------           ---------          
1998             $ 329,166        
1997               381,977        
1996               797,920        
1995               837,399        
1994               785,723        

The Company's backlog of unshipped orders at March 31, 1998 was approximately   
$4,600,000.  This backlog consists of approximately 74% commercial product      
orders and approximately 26% military product orders, all of which is expected  
to ship within Fiscal Year 1999.                                                

 -3-
Commercial Products and Markets                                                 

Ground fault protective devices protect equipment and people against electrical 
faults which can occur between electrically "live" conductors and ground.       
These ground fault conditions can damage equipment, start fires, or seriously   
or fatally injure humans.                                                       

Ground Fault Circuit Interrupters ("GFCI") and Appliance Leakage Circuit        
Interrupters ("ALCI") provide protection from dangerous electrical shock by     
sensing leakage of electricity and cutting off power.  Equipment Leakage        
Current Interrupters ("ELCI") detect current leakage within machines such as    
copy machines, printers and computers.  GFCIs are currently available in three  
types:  circuit breaker, receptacle and portable.  The Company specializes in   
the portable types of these products.                                           

A ground fault is a condition where electric current finds an unintentional     
path to ground such as through the exposed metal parts of an appliance or tool. 
Faults occur because of damage that causes internal wiring to touch these       
exposed metal parts or because an appliance or tool gets wet.  Upon such        
occurrence, the entire device can become as electrically alive as the power     
line to which it is attached.  If a person is touching such a live device while 
grounded (by being in contact with the ground or, for example, a metal pipe,    
gas pipe, drain or any attached metal device), that person can be seriously or  
fatally injured by electric shock.  Fuses or circuit breakers do not provide    
adequate protection against such shock, because the amount of current necessary 
to injure or kill a normal adult is far below the level of current required for 
a fuse to blow or a circuit breaker to trip.  GFCIs constantly monitor          
electric current, and as long as the amount of current returning from the       
appliance is equal to the amount that is directed to the device, the GFCI       
performs no activities.  Conversely, if there is less current coming back       
than there is flowing into the device, some portion must be taking a path       
through a foreign body, thereby creating a hazard.  Upon recognizing that       
condition, the GFCI terminates the flow of electricity instantaneously.         

An ELCI is a device intended to provide leakage current protection in           
appliances and utilization equipment whose function is to interrupt all         
ungrounded conductors of the supply circuit to electrical equipment in the      
event a current, in excess of the trip current, occurs between live parts       
and the grounded enclosure or other grounded parts.  The basic standard used    
to investigate these products is the Standard for Ground Fault Circuit          
Interrupters, UL 943, excluding requirements concerning trip current and        
time.  ELCIs are considered "equipment protection" devices.  The Company        
has a unique versatile product called the "Electra Shield" which provides ELCI  
capability, three-mode surge suppression, power line filtering, and facsimile   
modem surge protection.  This unique product offers multimedia protection for   
home and office personal computers, fax modems, TV and entertainment systems.   

An ALCI is a device intended to be used in conjunction with an electrical       
appliance whose function is to interrupt both conductors of the electric        
circuit to a load when a fault current to ground exceeds 4 - 6 mA and is        
less than that required to operate the overcurrent protection device of the     
circuit.  The ALCI is intended to be used only in a circuit that has a          
solidly grounded neutral conductor, and is not intended to be used in place     
of a GFCI in applications where the GFCI is required.  ALCIs are considered     
"personnel protection" devices.  This product is intended for infrequent and    
short-time use, and used only while attended; for example, with kitchen         
appliances, floor care products, hair dryers, and the like, which are connected 
to a power supply circuit by means of a flexible cord terminating in an         
attachment plug.                                                                
 -4-
Government and industry research into the major causes of fire has led to a     
search for new, cost-effective methods to prevent electrical fires.  In         
response to this need, the Company developed and patented "Fire Shield", a      
product designed to prevent fires caused by damaged or aging appliance and      
extension cords, which have been identified as a leading cause of electrical    
fires.  According to the United States Consumer Product Safety Commission       
("CPSC"), these types of fires caused 149,900 residential structural fires      
involving electrical equipment, which resulted in 750 civilian deaths, more     
than 6,320 injuries and nearly $1.3 billion in property losses.  The CPSC       
estimates were based on 1994 fire service reports.                              

The National Electrical Code (the "Code") requires GFCIs for the                
protection of receptacle outlets outdoors, as well as in bathrooms, garages     
and other risk areas, and in new residences, hotels and public buildings.       
The Code is followed by most local government building codes.  There is         
increasing effort by certain groups such as the National Electric               
Manufacturers Association and Consumer Products Safety Commission to require    
GFCI protection in other locations and applications.  The Company presently     
focuses its marketing efforts in certain spot markets which have developed      
in response to Code imposed requirements.                                       

For example, a Code requirement that became effective on January 1, 1991,       
requires that a protective device be incorporated into hair dryers, curling     
irons and crimpers to protect users from possible electrocution.  In response   
to this Code change, the Company developed a smaller GFCI plug that             
incorporates its patented GFCI/ALCI technology.  Additionally, the Company      
developed an Immersion Detection Circuit Interrupter ("IDCI") that can also be  
used to protect users of these products.                                        

Also, Article 625 of the 1996 Edition of the National Electrical Code requires  
electric vehicle ("EV") charging systems to include a system that will protect  
people against serious electric shock in the event of a ground fault.  The      
Company has shipped product to the majority of the major automobile             
manufacturers in support of their small EV production builds, and the Company   
is active with various standards and safety bodies, relating to the electric    
vehicle, on a worldwide basis.  As the EV market grows, the Company is well-    
positioned to grow along with it.                                               

The Company currently manufactures and markets various portable GFCI, ALCI and  
ELCI products, such as plug-in portable adapters, several extension cord        
models in various lengths, various modules for OEM customers, and variations    
of such products for voltage differences in both the United States and foreign  
markets.  The Company has been issued several domestic and foreign patents      
on its portable GFCI which incorporate design features not available on any     
similar product known to the Company (see Patents, Licenses and Trademarks on   
page 9 for further information).  The Company has entered into seven license    
agreements and three sales and marketing agreements concerning the portable     
GFCI, ALCI and ELCI.  These agreements are with entities located in Australia,  
France, Italy, Japan, the United Kingdom and the United States and are for the  
purpose of market penetration in those areas where it would be difficult for    
the Company to compete on a direct basis.                                       

 -5-
On April 24, 1997, the Company came to an amicable conclusion of its license    
agreement with Windmere Corporation (the "Agreement") which had been            
in effect since August 2, 1988.  Windmere Corporation is a large Miami,         
Florida based manufacturer and distributor of a wide variety of, among other    
items, portable personal care and household products utilizing electric current 
(e.g. haircurlers, irons, food mixers and numerous other items), most of        
which are sold both domestically and internationally.  Under the Agreement,     
Windmere was granted an exclusive license (subject to the rights of certain     
other preexisting licensees) to sell and distribute certain GFCI/ALCI or IDCI   
based electrical safety products in the United States, and to manufacture       
GFCI/ALCI and IDCI units (a) in the Far East (a defined term within the         
Agreement referencing most Asiatic countries) for incorporation into finished   
electrical safety products to be sold throughout the world directly or by way   
of Far East OEMs; or (b) in the United States for sale or distribution, at      
retail, in conjunction with personal care items and household appliances.  The  
Company also agreed to purchase its requirements of Far East manufactured GFCI  
and IDCI products from Windmere and its affiliates as long as the Company could 
obtain the same in a reasonable period and at a competitive cost.  The          
Company's decision to produce these products at its Honduran subsidiary, along  
with the fact that Windmere's use of the Company's license would be limited     
going forward, brought about the termination of the Agreement.                  

Military Products and Markets                                                   

The Company has been honored for the calendar years 1995, 1996 and 1997 to be   
rated as a Best Value Medalist for the highest rating Gold Category by the      
Defense Logistics Agency, which signifies the Company's commitment to military  
contract performance.                                                           

The Company is currently a supplier of control equipment used in engine         
generator systems purchased by the United States military and its prime         
contractors.  The term "control equipment" refers to the electrical controls    
used to control the electrical power output of the generating systems.  In      
general, the controls monitor and regulate the operation of generator mobile    
electric generating system sets.  Electric generating systems are basic to all  
branches of the military, and demand has remained relatively constant, unlike   
products utilized in armaments and missiles.  Sales are made either directly    
to the government for support parts or to prime contractors for new electric    
generator sets which incorporate the Company's products.  The Company is a      
qualified supplier for 37 control equipment products as required by the         
Department of Defense and is a supplier of the following types of control       
equipment, among others:  protective relays and relay assemblies,               
instrumentation transducer controls, fault locating panel indicators, current   
transformer assemblies for current sensing control and instrumentation, motor   
operated circuit breaker assemblies and electrical load board and voltage       
change board assemblies.  These products are primarily furnished for spare      
parts support for existent systems in the military inventory.                   

In late 1989, the Company completed the redesign of the control equipment       
related to the Tactical Quiet Generator Systems program and provided prototype  
units to a prime contractor for testing, which was completed in the third       
fiscal quarter for the year ended March 31, 1992.  Subsequently, the Company    
received production orders for these products from the U.S. Government's prime  
contractor in the approximate amount of $7,500,000 covering the time period     
from August 1992 to October 1994.  All deliveries have been completed under     
this contract, and an additional $4,900,000 contract for these products was     

 -6-
awarded to the Company by a prime contractor in March 1995, which covers        
approximately a two-year period of which deliveries began in the second quarter 
of Fiscal Year 1997.  Shipments to this program will not be as strong during    
Fiscal Year 1999 as the current phase of the contract nears completion and      
until the next phase of the recently awarded follow-on contract is placed and   
scheduled in production by the prime contractor.  Additionally, several new     
government contracts have been awarded with similar control equipment for the   
engine generator systems, and the Company has positioned itself with the        
Government prime contractors to be a participant in this business.              

The Company continues to furnish various types of electrical power monitors     
for military Naval Shipboard requirements.  The monitors are used on all        
classes of Naval surface vessels, such as minesweepers, destroyers guided       
missile cruisers and aircraft carriers in addition to other types of Naval      
vessels.  The monitors are furnished for new vessel production, retrofit        
upgrades and existent vessels requiring spare support parts.  The Company also  
supplies the military with electrical devices for control and monitoring of the 
on-board auxiliary power diesel electric generating system for the new C2v      
Armored Chassis Tactical Vehicle, Electronic Command Post System and the newly  
developed armored ambulances.  These devices include A.C. power monitor         
assemblies (which provide system protection and status display on on-board      
computers), generator voltage regulators, power transformers, A.C. overcurrent  
and short circuit protection monitor assemblies and current sensing             
transformers.  All of these products have met the high shock and vibration and  
endurance testing requirements during both highly accelerated stress screening  
tests and vehicle road testing at Aberdeen Proving Grounds.  The Company        
is now receiving order releases for the initial low rate production phase for   
C2v vehicles.                                                                   

The Company's contracts with the U.S. Government are on a fixed-price bid       
basis and are not subject to price renegotiation.  As with all fixed-price      
contracts, should manufacturing costs exceed the selling price, the contract    
could result in a loss.  All government contracts contain a provision that      
allows for cancellation by the government "for convenience."  However, the      
government must pay for costs incurred and a percentage of profits expected     
if a contract is so canceled.  On occasion, contract disputes arise which       
could result in a suspension of the contract or a reduction in the amounts      
claimed.                                                                        

Testing and Qualification                                                       

A number of the Company's commercial products must be tested and approved by    
UL.  UL publishes certain "Standards of Safety" which various types of          
products must meet and performs specific tests to ascertain whether a product   
meets the prescribed standards.  If a product passes these tests, it receives   
UL approval.  Once the Company's products have been initially tested and        
qualified by UL, they are subject to regular field checks and quarterly         
reviews and evaluations.  UL may withdraw its approval for such products if     
they fail to pass these tests and if prompt corrective action is not taken.     
The Company's portable electrical safety products have received UL approval.    
In addition, certain of the Company's portable GFCI, ALCI and ELCI products     
have successfully undergone similar testing procedures conducted by             
comparable governmental testing facilities in Europe, Canada and Japan.         

The Company's military products are subject to testing and qualification        
standards imposed by the United States government.  The Company has             
established a quality control system which has been qualified by the United     

 -7-
States Department of Defense to operate under the requirements of a             
particular specification (MIL-I-45208).  To the extent the Company designs      
a product which it believes to meet those specifications, it submits the        
products to a government testing laboratory, such as that located at Ft.        
Belvoir, Virginia.  If approved, the product is rarely subject to               
requalification; however, the military may disqualify a product if it is        
subject to frequent or excessive operational failures.  Further, the current    
specifications and requirements could be changed at any time, which would       
require the Company to redesign its existing products or develop new            
products which would have to be submitted for testing and qualification         
prior to their approval for purchase by the military or its prime               
contractors.  Certain contracts require testing and acceptance by government    
inspectors prior to shipment of the product.                                    

The Company is presently enhancing its quality processes with the objective     
to meet the ISO 9000 Series International Quality Standards, and the Company's  
wholly owned foreign subsidiary, TRC/Honduras S.A. de C.V., has been            
recommended by an independent certifying organization for ISO 9002              
certification.                                                                  

Design and Manufacturing                                                        

The Company currently designs almost all of the products which it produces      
and generally will not undertake special design work for customers unless it    
receives a contract to produce the resulting products.  The Company continues   
to work with foreign licensees to design products for foreign markets.          
A significant number of the Company's commercial and military electronic        
products are specialized in that they combine both electronic and magnetic      
features in design and production.                                              

The business of an electronics manufacturer, such as the Company, primarily     
involves assembly of component parts.  The only products which the Company      
manufactures from raw materials are its transformers and magnetic products.     
The manufacture of such products primarily involves the winding of wire         
around magnetic steel cores.  The remainder of the products which the           
Company manufactures are assembled from component parts produced by other       
manufacturers.                                                                  

On February 3, 1997, the Company's Board of Directors approved the              
incorporation of TRC Honduras, S.A. de C.V., a wholly owned subsidiary of       
Technology Research Corporation, for the purpose of manufacturing the Company's 
high-volume products. This decision was made in line with the Company's goal of 
always striving to improve quality, profit margins and customer satisfaction.   
TRC Honduras, S.A. de C.V. resides in a leased 42,000 square foot building      
located in ZIP San Jose, a free trade zone and industrial park, in San Pedro    
Sula, Honduras.  The lease is for a term of five years with an option to        
extend the lease for another five years.  The benefits of being located in a    
free trade zone include no Honduran duties on imported raw materials or         
equipment, no sales or export tax on exported finished product, a twenty year   
Honduran federal income tax holiday and a ten year Honduran municipal income    
tax holiday for the profits generated by the Honduran subsidiary, and various   
other benefits.  TRC Honduras, S.A. de C.V. has been funded by the Company with 
equity of $1,400,000 to be used for machinery, equipment and various start-up   
costs.                                                                          

The Company continues to manufacture its military and low-volume commercial     
products in its 43,000 square foot facility in Clearwater, Florida.             

 -8-
Patents, Licenses, and Trademarks                                               

The Company's President, Mr. Legatti, has designed for the Company and the      
Company has been issued four U.S. patents and two British, Canadian, Italian    
and Australian patents with respect to its portable GFCIs that have features    
not presently available on any similar product known to the Company.  Also,     
patents on the same device have been issued from France, Japan, Germany and     
three other countries.  The patents will be valid for 20 years in the United    
States running from January 1986.  Duration of patents in the other countries   
vary from 15 to 20 years.                                                       

The Company licenses its technology for use by others in exchange for a         
royalty or product purchases.  Licensees are located in Australia, France,      
Italy, Japan, the United Kingdom and the United States.  Each licensee agrees   
to pay the Company a royalty or purchase product based on schedules set forth   
in the applicable agreement.  The Company agrees to provide certain technical   
support and assistance to its licensees.  The licensees have agreed to          
indemnify and hold the Company harmless against any liability associated with   
the manufacture and sale of products subject to the license agreement,          
including but not limited to defects in materials or workmanship.               

The Company has no other patents on or licensee agreements with respect to      
its products or technology, but has registered its TRC trademark with the U.S.  
Office of Patents and Trademarks.                                               

Marketing                                                                       

The Company's products are sold throughout the world, primarily through an      
expanded in-house sales force, licenses and sales and marketing agreements.     
Although the Company will continue to market existing and new products through  
these mediums, the Company is looking for other viable mediums through which    
to market its products.  The Company relies significantly upon the marketing    
skills and experience, as well as the business experience, of the management    
of the Company in marketing its products.                                       

The Company complements its marketing activity through the use of additional    
distributors and sales representative organizations.  The Company's internal    
distribution division, TRC Distribution, is supported by 25 independent sales   
representatives who sell to 662 electrical, industrial and safety distributors. 

The Company also markets through OEMs that sell the Company's GFCI products     
under their own brand label.  Additionally, the Company has exhibited its GFCI  
products at numerous trade shows which have resulted in new commercial markets, 
including the recreational vehicle industry and the appliance industry.         

In Fiscal Year 1997, the Company implemented a consumer sales program for its   
Safe Living/Smart Products using independent distributors that specialize in    
selling products directly to the household consumer. The Company modified this  
program in Fiscal Year 1998 and has increased its public relations efforts to   
heighten consumer awareness for these products.  The Company has targeted       
Electric Utilities as a distribution channel for selling its products to the    
consumer since many utilities are in the process of dealing with deregulation   
and are seeking other sources of revenue from their rate paying customer.  The  
Company is working with a number of these utilities to implement programs to    
sell various Safe Living/Smart Products.                                        

 -9-
The Company utilizes primarily foreign licenses and sales and marketing         
agreements to market its products internationally (see Patents, Licenses and    
Trademarks on page 9 for further information).  The Company's products have     
world-wide application, and the Company believes that international demand      
for these products will continue to contribute to the Company's growth.         

The Company offers its customers no specific product liability protection       
except with regards to those customers that are specifically named as "Broad    
Form Vendors" under its product liability coverage.  The Company does extend    
protection to purchasers in the event there is a claimed patent infringement    
that pertains to the Company's portion of the final product.  The Company also  
carries product and general liability insurance for protection in such cases.   

Major Customers and Exports                                                     

Individual customers and aggregate exports which accounted for 10% or more of   
sales were:                                                                     
                                             Year ended March 31
                                             -------------------
 Customer                                   1998        1997        1996
 --------                                   ----        ----        ----
   Xerox Corporation                    $  2,838,905   2,529,398   1,686,421
Noma Appliance & Electric, Inc.,                                      
f/k/a Fleck Manufacturing, Inc.                             
        (a Xerox Corporation supplier)     1,666,516   1,776,424   2,358,887
   Other Xerox Corporation suppliers         133,044     802,800   2,474,142
   Fermont Division                        2,817,079           -           -
                                           ---------   ---------   ---------
                                        $  7,455,544   5,108,622   6,519,450
Exports:                                                              
        Canada                          $  1,894,215   1,831,898   2,367,890
        Far East                             486,277   1,057,605   1,967,494
        Europe                             2,554,772   1,396,823   1,750,257
        Mexico                               979,187     736,992     569,845
        Australia                            218,530     150,760     438,875
        South America                         20,994      82,838           -
        Middle East                            3,397       5,324           -
                                           ---------   ---------   ---------
             Total exports              $  6,157,372   5,262,240   7,094,361
                                           =========   =========   =========

Sales to Xerox Corporation and its suppliers were down from the previous fiscal 
year due primarily to a price reduction effective August 1, 1997.  Xerox and    
its suppliers accounted for approximately 26% of the Company's sales for Fiscal 
Year 1998, compared to approximately 34% for the prior fiscal year, and because 
they account for such a large percentage of the Company's sales, the loss of    
Xerox as a customer would have a material adverse effect on the Company's       
business.  Higher exports to Europe and Mexico and lower exports to the Far     
East can primarily be attributed to Xerox's international suppliers.  Overall,  
exports to the Company's international OEM customers were stronger for Fiscal   
Year 1998 compared to the Company's prior fiscal year.                          

The Company's military product sales are primarily to OEM prime contractors     
and secondarily to military procurement logistic agencies for system support    
parts.  In Fiscal Year 1998, military sales were approximately 26% of total     
sales, compared to 15% in the prior year.  The increase was primarily due to    
the level of sales with Fermont Division, the U. S. Government's prime          
contractor for the Tactical Quiet Generator Systems Program, of which the       
Company was in full production in Fiscal Year 1998.                             
  -10-
The Company has no relationship with any of its customers except as a           
supplier of product.                                                            

Competition                                                                     

The commercial and military business of the Company is highly competitive.      

In the commercial market, the Company has significant competition, except       
with respect to the "Fire Shield" products.  The Company believes, however,     
that product knowledge, patented technology, ability to respond quickly to      
customer requirements, positive customer relations, price, technical            
background and industry experience are major competitive factors, and that it   
competes favorably with respect to these factors.  In addition, the Company's   
patented GFCI technology utilizes, in certain adaptations, waterproofing, a     
retractable ground pin and "trip mechanism" techniques, each of which           
provides the Company, in the judgment of its management, with a current         
competitive advantage.                                                          

In the military market, the Company's products must initially pass              
government specified tests.  The Company must compete with other companies,     
some being larger and some smaller than the Company, acting as suppliers of     
similar products to prime government contractors.  The Company believes that    
knowledge of the procurement process, engineering and technical support, price  
and delivery are major competitive factors in the military market.  The Company 
believes that it has strength in all of these areas due to senior management's  
involvement in the government procurement process and experience in the design  
engineering requirements for military equipment.  A substantial portion of      
spare part procurement is set aside for small business concerns, which are      
defined in general as entities with fewer than 1,000 employees.  Because the    
Company is classified as a small business concern, it qualifies for such set    
aside procurements for which larger competitors are not qualified.  The entry   
barriers to the military market are great because of the need, in most cases,   
for products to pass government tests and qualifications.                       

Research, Development and Engineering                                           

The Company employs 23 persons in the Engineering Department, all of whom       
are engaged either full or part-time in research and development activities.    
This department is engaged in designing and developing new commercial and       
military products and improving presently existing products to meet the         
needs of the Company's customers.                                               

In connection with its efforts in developing the GFCI product, the Company      
believes that the increasing use of portable GFCI protection will provide       
new markets for its expansion into the commercial marketplace, and              
accordingly,  the Company has modified its GFCI designs to fit these markets    
and new applications.  There can be no assurance, however, that the Company can 
maintain its sales levels in the commercial market in view of the possibility   
that an increased level of competition may develop.                             

The Company spent $1,223,422 in Fiscal Year 1998, $1,147,630 in Fiscal Year     
1997 and $975,568 in Fiscal Year 1996 on research, development and              
engineering activities.  None of these activities were sponsored or financed    
by customers, and all are expensed as incurred.  The Company anticipates        
spending levels to remain constant in the new fiscal year.                      

  -11-
Employees                                                                       

As of March 31, 1998, the Company employed 145 persons on a full time basis,    
and of that total, 91 employees were engaged in manufacturing operations, 23 in 
engineering, 19 in marketing and 12 in administration.                          

The Company's subsidiary employed 338 persons on a full time basis as of        
March 31, 1998, and of that total, 333 employees were engaged in manufacturing  
operations and 5 in administration.                                             

None of the Company's employees are represented by a collective bargaining      
unit, and the Company considers its relations with employees to be stable.      

ITEM 2.  PROPERTIES                                                             

The Company's executive offices and U.S. manufacturing facility are located on  
4.7 acres of leased land in the St. Petersburg-Clearwater Airport Industrial    
Park.  The lease, with options, extends for 40 years until 2021 and is subject  
to certain price escalation provisions every five years.  This leased land is   
adequate to enable the Company to expand this facility to 60,000 square feet.   
The present facility provides a total of 43,000 square feet, including 10,000   
square feet of offices and engineering areas, as well as 23,000 square feet of  
production areas and 10,000 square feet of warehouse space.                     

In March 1997, the Company entered into a five year lease agreement with        
ZIP San Jose, an industrial park located in San Pedro Sula, Honduras, for a     
42,000 square foot building in which the Company manufactures its high-volume   
products.  The Company has the option of extending the lease another five years 
if it wishes.  Lease payments began in May 1997 and continue through July 2002. 

ITEM 3.  LEGAL PROCEEDINGS                                                      

The Company is involved in various claims and legal actions arising in the      
ordinary course of business.  In the opinion of the Company, the ultimate       
disposition of these matters will not have a material adverse effect on the     
Company.                                                                        

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS                    

No matters were submitted to a vote of security holders during the fourth       
quarter of the fiscal year ended March 31, 1998.                                

  -12-
Part II     

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED SECURITY HOLDER      
MATTERS                                                       

The Company's shares of Common Stock are registered under 12(g) of the          
Securities Exchange Act of 1934 and are traded in the over-the-counter market   
utilizing the NASDAQ trading system, to which the Company gained admittance in  
December 1984, under the symbol "TRCI".  In November 1995, NASDAQ approved the  
Company's application for listing on the National Market.  The following        
tables set forth a range of high and low market prices for the Company's        
Common Stock for the fiscal years ended March 31, 1998, 1997 and 1996 as        
reported by the NASDAQ system.                                                  
                               Market Price             Cash
Fiscal Year Ended                       High       Low          Dividends       
March 31, 1998:                         ----      ----          ---------       
First Quarter    .................    4 1/8     3 1/16         $ .06        
Second Quarter   .................    4 1/2     3 9/16           .06        
Third Quarter    .................    4 9/16    3                .06        
Fourth Quarter   .................    3 7/16    1 15/16            -        
                                                        ----
                                                       $ .18
March 31, 1997:                                                                 
First Quarter    .................    6 1/4     4 1/2          $ .06        
Second Quarter   .................    5 3/8     3 7/8            .06        
Third Quarter    .................    4 5/8     4                .06        
Fourth Quarter   .................    4 9/16    3 13/16          .06        
                                                        ----
                                                       $ .24
March 31, 1996:                                                                 
First Quarter    .................    5 1/4     3              $ .06        
Second Quarter   .................    6 3/16    4 5/16           .06        
Third Quarter    .................    5 1/2     3 3/4            .06        
Fourth Quarter   .................    5 11/16   3 7/8            .06        
                                                        ----
                                                       $ .24

As of May 29, 1998, the approximate number of the Company's shareholders was    
700.  This number does not include any adjustment for shareholders owning       
common stock in the Depository Trust name or otherwise in "Street" name,        
which the Company believes represents an additional 2,500 shareholders.         

On August 23, 1995, at the Company's Annual Meeting, the shareholders           
approved a one share for three share reverse stock split, by a majority vote    
of 82.24%.  The record date for the reverse stock split was September 15,       
1995, and the Company's financial information now reflects the reverse split    
for all periods presented.                                                      

The Company's authorized capital stock, as of May 29, 1998, consisted of        
10,000,000 shares of authorized common stock, par value $.51, of which          
5,400,253 shares were issued and outstanding.                                   

On March 16, 1998, the Company announced that its Board of Directors suspended  
its fourth quarter dividend.  The Company's Board of Directors will review      
the Company's dividend policy on a quarterly basis and make a determination at  
such time as to whether the Company will resume payment of a dividend based on  
the Company's cash and earnings position.  The Company declared dividends of    
$.18 per share during Fiscal Year 1998 and $.24 per share during Fiscal Years   
1997 and 1996.                                                                  
  -13-
ITEM 6.  SELECTED FINANCIAL DATA                                                

                    1998       1997       1996       1995       1994
                    ----       ----       ----       ----       ----
Year ended March 31:                                                            

Operating revenues $ 18,430,951 15,385,571 17,379,221 21,772,956 20,489,177 

Gross profit       $  4,836,280  4,747,997  5,895,687  5,246,105  5,618,096 

Net income (loss)  $   (196,314)   566,658  2,038,785  1,867,957  2,296,778 

Basic earnings                                                                  
 per share        $       (.04)       .11        .39        .36        .48

Weighted average number                                                         
of common shares                                                            
outstanding           5,332,571  5,321,698  5,281,932  5,159,614  4,809,434 

Diluted earnings                                                            
 per share        $       (.04)       .10        .38        .35        .45

Weighted average number                                                     
of common and                                                           
equivalent shares                                                       
 outstanding         5,332,571  5,441,620  5,404,885  5,339,953  5,083,007

Cash dividends                                                              
 declared         $        .18        .24        .24          -          -

March 31:                                                                       

Working capital    $  6,875,679  9,651,145 10,931,740 10,089,672  9,102,131 

Total assets       $ 15,746,818 15,637,949 15,380,590 14,813,938 13,443,899 

Current                                                                     
 liabilities      $  4,243,200  2,903,154  1,867,678  2,119,000  2,216,719

Long-term debt     $    131,250    206,250    281,350    356,350    831,350 

Total liabilities  $  4,374,450  3,109,404  2,149,028  2,475,350  3,123,069 

Retained earnings  $  1,241,176  2,397,353  3,108,371  2,340,267    470,310 

Total stockholders'                                                       
equity             $ 11,372,368 12,528,545 13,231,562 12,338,588 10,320,830 

  -14-
ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND        
RESULTS OF OPERATIONS                                         

Operating Results:                                                              

Fiscal Years 1998 and 1997 Comparison                                           

The Company's operating revenues (net sales and royalties) for the fiscal year  
ended March 31, 1998 ("Fiscal Year 1998") were $18,430,951, compared to         
$15,385,571 reported for the Company's fiscal year ended March 31, 1997         
("Fiscal Year 1997"), an increase of approximately 20%. The Company lost        
$196,314 for Fiscal Year 1998, compared to earning $566,658 for Fiscal Year     
1997, and basic and diluted earnings were $(.04) per share for Fiscal Year      
1998, compared to basic earnings of $.11 per share and diluted earnings of      
$.10 per share for Fiscal Year 1997. Common and equivalent shares outstanding   
were comparable from year to year.                                              

The Company's higher revenues for Fiscal Year 1998 were due to commercial sales 
increasing by $631,171 and military sales increasing by $2,467,020 over the     
prior year.  The increase in commercial sales was primarily due to the level    
of business with the Company's international OEM customers while sales to the   
Company's domestic OEM customers were flat during Fiscal Year 1998.  Sales to   
Xerox Corporation and its suppliers decreased by $343,969 primarily due to      
a price reduction which went into effect August 1, 1997.  The increase in       
military sales was primarily due to the Company being in full production of the 
products related to the Tactical Quiet Generator Systems program.  Shipments to 
this program will not be as strong in Fiscal Year 1999 as the current phase of  
the contract nears completion and until the next phase of the recently awarded  
follow-on contract is placed and scheduled in production by the Prime           
Contractor.  The Company expects, however, continued growth in commercial sales 
with additional participation from the U.S. OEM market for the reasons stated   
below.  Sales to Xerox should be steady.                                        

Royalty income was down, as expected, by $52,811 due to less royalties from     
Windmere Corporation.  In April 1997, the Company agreed to accept a final      
payment of $100,000 from Windmere to license the Company's products with the    
understanding that no future royalties would be paid to the Company.  On        
May 17, 1997, the Company granted an exclusive license to Yaskawa Control of    
Japan for the Company's full line of commercial electrical protection devices   
and the Company's protective devices for the electric vehicle charging systems. 
The Company received a licensing fee of $125,000 from Yaskawa Control in Fiscal 
Year 1998 which substantially offset the loss of royalty income from Windmere   
Corporation.                                                                    

The Company has taken a number of actions to make Fiscal Year 1999 a profitable 
year with revenue growth.  First, for the past few months, the Company has      
employed a highly experienced manufacturing professional, who has extensive     
knowledge of the Company's product lines to work with the Honduran management   
team.  In addition, Steve Jackson, Vice President of Operations for the         
Company, has been recently assigned to reside full time in Honduras until such  
time as the operating inefficiencies have been corrected and the operation      
contributes to the Company's profitability.  Second, the Company's operating    
budgets for Fiscal Year 1999 have been slashed by approximately $800,000 from   
last year's actual operating expenditures.  Third, the Company has consolidated 
its U.S. Commercial Sales functions under Edward A. Schiff, who has been        
promoted to Vice President U.S. Commercial Sales and Marketing.  This           
consolidation will provide increased focus on specific market segments          
facilitating revenue growth for the Company's commercial and consumer business. 

  -15-
Although the Company's revenues were higher for Fiscal Year 1998, compared to   
Fiscal Year 1997, net income decreased as a result of higher period expenses    
and lower gross margins.  Higher period expenses were primarily due to the      
Company's special marketing programs, and lower gross margins were a result of  
manufacturing inefficiencies and inventory adjustments related to the Company   
restructuring its manufacturing operations from a contract manufacturer in      
China to its wholly owned subsidiary in Honduras(see next paragraph).  The      
lower gross margins resulted from approximately $1,200,000 of additional        
manufacturing cost variances incurred for the Company to produce its products   
in Fiscal Year 1998, compared to the prior year, with the majority of these     
variances occurring in the third and fourth quarters.                           

The Company's wholly owned subsidiary, TRC Honduras, S.A. de C.V., recorded a   
loss of $375,264 for Fiscal Year 1998.  As part of the Company's on-going       
plan to produce its high-volume products at its Honduran subsidiary, the        
Company added six additional products to the production process in Honduras in  
the third quarter.  Unfortunately, the manufacturing complexities associated    
with adding these additional products caused its subsidiary not to meet its     
production shipment plan for the third and fourth quarters, and the result was  
that additional product continued to be produced at the Company's Clearwater    
facility causing the use of temporary employees and heavy overtime as well as   
higher labor rates in order to meet customer delivery commitments.              

Total expenses for marketing the Company's "Fire Shield" and consumer Safe      
Living/Smart Products were $373,648 and $380,950 for Fiscal Year 1998,          
respectively.  Although no significant sales have been recorded to date for     
these products, the Company has received its first order for OEM "Fire Shield"  
cord sets to be used with portable heaters.  The Company hopes that this is the 
first step in convincing other appliance manufacturers to incorporate           
"Fire Shield" into their products to prevent dangerous electrical cord fires.   
The Company will continue to pursue its marketing plan to sell its line of      
OEM "Fire Shield" products and will continue to work to have some of them       
included in the National Electrical Code.                                       

The Company's gross profit margin was approximately 27% of net sales for Fiscal 
Year 1998 compared to 32% for the prior year.  The difference was primarily     
due to weaker profit margins resulting from the price reduction to Xerox        
Corporation and manufacturing inefficiencies, inventory adjustments and         
the Company restructuring its manufacturing operations from a contract          
manufacturer in China to its wholly owned subsidiary in Honduras.  The Company  
believes this restructuring will ultimately result in lower duty, freight and   
product costs thus positioning the Company to remain competitive in the future. 

Selling, general and administrative expenses for Fiscal Year 1998 were          
$4,023,205, compared to $3,458,872 for the prior year, an increase of           
approximately 16%.  Selling expenses were $2,710,774 for Fiscal Year 1998,      
compared to $2,257,128 for the prior year, an increase of approximately 20%,    
reflecting expenses related to the marketing of the "Fire Shield" products and  
the consumer marketing program.  General and administrative expenses were       
$1,312,431, compared to $1,201,744 for the prior year, an increase of           
approximately 9%, reflecting the additional administration expenses of the      
Company's Honduran subsidiary.                                                  

Research, development and engineering expenses for Fiscal Year 1998 were        
$1,223,422, compared to $1,147,630 for the prior year, an increase of           
approximately 7%, reflecting primarily higher salary expenses related to a      
a greater number of employees in the department.                                

  -16-
Interest expense, net of interest and sundry income, for Fiscal Year 1998 was   
$4,462, compared to interest and sundry income, net of interest expense, of     
$173,670 for the prior year, reflecting higher interest expense, due to the     
Company using its line of credit, and lower returns and average balances on     
the Company's short-term investments.                                           

Income tax expense for Fiscal Year 1998 was $110,671, compared to $130,484 in   
the prior year, which was based on U.S. income before income tax of $289,621    
and $697,142, respectively.  The Internal Revenue Code does not allow a tax     
benefit for losses on foreign subsidiaries, and no tax benefit is available in  
Honduras.  For this reason, the Company did not record any tax benefit from     
the loss of $375,264 recorded by TRC Honduras S.A. de C.V., the Company's       
wholly owned foreign subsidiary.  The actual tax rate for Fiscal Year 1997 was  
less than the expected tax rate, primarily due to the Company receiving a       
favorable ruling from the State of Florida as discussed below.                  

Fiscal Years 1997 and 1996 Comparison                                           

The Company's operating revenues (net sales and royalties) for the Company's    
fiscal year ended March 31, 1997 ("Fiscal Year 1997") were $15,385,571,         
compared to $17,379,221 reported for the Company's fiscal year ended March 31,  
1996 ("Fiscal Year 1996"), a decrease of approximately 11%. The Company's net   
income for the Fiscal Year 1997 was $566,658, compared to $2,038,785 for Fiscal 
Year 1996, and basic earnings were $.10 per share and diluted earnings were     
$.11 per share for Fiscal Year 1997, compared to basic earnings of $.39 per     
share and diluted earnings of $.38 per share for Fiscal Year 1996.  Common and  
equivalent shares outstanding were comparable from year to year.                

The Company's lower revenues for Fiscal Year 1997 were due to commercial sales  
decreasing by $1,738,121 from the prior year as a result of the level of        
business with Xerox and, to a lesser extent, the sprayer/washer market.         
Revenues from the high pressure sprayer/washer market were negatively           
impacted in Fiscal Year 1997, as well as Fiscal Year 1996, by a provision in    
the National Electrical Code permitting the use of double-insulation for        
certain sprayer/washer products to be sold without a GFCI provided they are     
used with a GFCI.  This provision was eliminated in the National Electrical     
Code, effective January 1996.  The revenues associated with Xerox were          
negatively impacted by a price reduction on October 1, 1996 and by the          
transition period of the Company supplying Xerox with its European product      
requirements instead of Temic Telefunken, which had an impact on both royalties 
from Temic and shipments of piece parts to Temic which were used by Temic to    
manufacture finished product.  Military sales increased by $160,414 from the    
previous year due to the Company entering into full production of the products  
related to the Tactical Quiet Generator Systems program, which has an expected  
value of $4,900,000 over approximately two years.                               

Royalty income for Fiscal Year 1997 was $381,977, compared to $797,920 for      
Fiscal Year 1996, a decrease of $415,943, or approximately 52%.  The Company's  
royalties were down, as expected, due to less royalties received from Windmere  
Corporation and Temic(Telefunken Microelectronics)GmbH.  The Company received   
less royalties from Windmere, because Windmere, in an effort to reduce their    
product cost because of competitive pressures, negotiated a lower royalty       
agreement with the Company effective in Fiscal Year 1997.  The Company received 
less royalties from Temic in Fiscal Year 1997 as a result of Xerox transferring 
their European product requirements back to TRC during Fiscal Year 1997.        

  -17-
The Company's revenues rose steadily throughout Fiscal Year 1997 since its      
first quarter ended June 30, 1996.  The Company did not, however, experience    
the anticipated revenues from the "Fire Shield" products and the consumer       
marketing initiative, which were needed, in addition to the Company's existing  
business, to achieve revenue growth over Fiscal Year 1996.                      

The Company's gross profit margin was approximately 32% of net sales for Fiscal 
Year 1997 compared to 36% for the prior year.  The difference was primarily     
due to weaker profit margins resulting from the price reduction to Xerox        
Corporation and the transition period of the Company shipping product directly  
to Xerox and its suppliers from China in the fourth quarter.                    

Selling, general and administrative expenses for Fiscal Year 1997 were          
$3,458,872, compared to $2,734,096 for the prior year, an increase of           
approximately 27%.  Selling expenses were $2,257,128 for Fiscal Year 1997,      
compared to $1,747,194 for the prior year, an increase of approximately 29%,    
reflecting expenses related to the marketing of the "Fire Shield" products and  
the consumer marketing program totaling approximately $650,000.  General and    
administrative expenses were $1,201,744, compared to $986,902 for the prior     
year, an increase of approximately 22%, reflecting primarily higher travel and  
salary related expenses of which the majority was attributed to those employees 
who spent 100% of their time promoting the Company's "Fire Shield" products.    

Research, development and engineering expenses for Fiscal Year 1997 were        
$1,147,630, compared to $975,568 for the prior year, an increase of             
approximately 18%, reflecting primarily higher salary expenses related to a     
a greater number of employees in the department.                                

Interest and sundry income, net of interest expense, for Fiscal Year 1997 was   
$173,670, compared to $220,656 for the prior year, reflecting lower returns     
and average balances on the Company's short-term investments.                   

Income tax expense as a percentage of net income before income taxes was        
approximately 19% for Fiscal Year 1997, compared to 36% in the prior year.      
The actual tax rate for Fiscal Year 1997 was less than the expected tax rate,   
primarily due to the Company receiving a favorable ruling from the State of     
Florida on August 20, 1996 regarding apportionment factors for state income tax 
purposes.  As a result of this ruling, the Company amended previously filed     
state income tax returns.  Accordingly, in the third quarter, the Company       
recorded a $240,000 state income tax credit, net of federal income taxes and    
adjustments in deferred taxes of $110,000, related to state income taxes paid   
in Fiscal Years 1993, 1994, 1995 and 1996.  As long as the Company maintains    
"nexus" (doing business) outside the State of Florida, the Company's            
apportionment factors will result in a lower effective income tax rate.         

  -18-
Liquidity and Capital Resources                                                 

As of March 31, 1998, the Company's cash and cash equivalents decreased to      
$1,153,798 from the March 31, 1997 total of $1,307,567, and short term          
investments decreased to $1,033,902 from the March 31, 1997 total of            
$3,031,013.  The short term investments are comprised of U.S. Treasury Bills.   

On August 15, 1998, the Company expects to renew its commercial line of credit, 
which is currently $2,500,000, with its institutional lender for another year,  
maturing in August 1999.  The Company continues to have the option of borrowing 
at the lender's prime rate of interest or the 30-day London Interbank Offering  
Rate (L.I.B.O.R.) plus 200 basis points.  The Company also has available a      
Banker's Acceptance agreement which gives the Company the option of borrowing   
up to $750,000 under the line of credit with the interest rate being determined 
by the lender's International Division at the time of borrowing.  The Company's 
debt from advances on its line of credit was $2,450,100 as of March 31, 1998.   

The Company's working capital decreased by $2,775,466 to $6,875,679 at March    
31, 1998, compared to $9,651,145 at March 31, 1997.  The decrease was           
primarily a result of the Company funding its Honduran subsidiary and the       
Company's earnings not exceeding its dividend.  The Company believes cash flow  
from operations, the available bank line, and its short term investments and    
current cash position will be sufficient to meet its working capital            
requirements for the immediate future.                                          

The mortgage payable to the Company's institutional lender as of March 31, 1998 
was $206,250, compared to $281,250 at March 31, 1997, reflecting the Company's  
payments on principal for the twelve-month period.                              

On March 16, 1998, the Company announced that its Board of Directors suspended  
its fourth quarter dividend.  The Company's Board of Directors will review      
the Company's dividend policy on a quarterly basis and make a determination at  
such time as to whether the Company will resume payment of a dividend based on  
the Company's cash and earnings position.  The Company declared dividends of    
$.18 per share during Fiscal Year 1998 and $.24 per share during Fiscal Years   
1997 and 1996.                                                                  

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of   
1995:  The statements in this report that relate to future plans,               
expectations, events, performance and the like are forward-looking statements,  
within the meaning of the Private Securities Litigation Act of 1995 and the     
Securities Exchange Act of 1934.  Actual results or events could differ         
materially from those described in the forward-looking statements due to a      
variety of factors, including those set forth in the Company's reports on       
Form 10-K and 10-Q filed with the Securities and Exchange Commission.           

  -19-
ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA                            

Response to this item is submitted in a separate section of this report         
starting at Page F-1.                                                           

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING            
AND FINANCIAL DISCLOSURE                                      

None.                                                                           

PART III    

Part III of this Form 10-K is incorporated by reference from the registrant's   
Proxy Statement for the Annual Meeting of Shareholders to be held on August     
20, 1998.                                                                       

PART IV     

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K       

                                                                          Page

(A)  1.  Independent Auditors' Report                                       F-1 

2.  Consolidated Financial Statements:                                

          Consolidated Balance Sheets                                      F-2
          Consolidated Statements of Income                                F-3
          Consolidated Statements of Stockholders' Equity                  F-4
          Consolidated Statements of Cash Flows                            F-5
          Notes to Consolidated Financial Statements                       F-6

     3.  Schedule II - Valuation and Qualifying Accounts                    F-19

4.  Exhibits included herein:  (See next page)                        

(B)  Reports on Form 8K                                                         

 No reports on Form 8K have been filed by the registrant during the last
quarter of the fiscal year.                                           

  -20-
INDEX TO EXHIBITS (Item 14(A)3) 

Exhibit                                                                         

(3)    (a)  Articles of Incorporation and By-Laws*                              
(b)  Certificate of Amendment to the Articles of Incorporation,   
dated September 24, 1990***                             
(c)  Certificate of Amendment to the Articles of Incorporation,   
dated September 24, 1996***                             

(10)   Material contracts:                                                      

(a)  License Agreement, dated as of January 1, 1985, between the  
       Company and Societe BACO, a French corporation, granting BACO a
      non-exclusive right to manufacture the Company's GFCI products
    in France, and the non-exclusive right to sell GFCI products
other than in North America.*                           

(b)  License Agreement between the Company and B & R Electrical   
Products, Ltd., an English corporation ("B & R") dated  
      January 1, 1985, granting B & R a limited exclusive license to
      manufacture GFCI products within the United Kingdom and a non-
     exclusive license to market other such products other than in
North America.*                                         

(c)  License Agreement, dated as of January 8, 1987, between the  
     Company and HPM INDUSTRIES PTY LTD, an Australian corporation
        ("HPM"), granting to HPM an exclusive license to manufacture and
       sell GFCI products in Australia, New Zealand, New Guinea, Papua
and Fiji.*                                              

  (d)  License Agreement between the Company and Windmere Corporation,
        dated August 2, 1988, granting to Windmere an exclusive (subject
    to previously existing marketing rights held by others under
       separate license agreements) license to sell and distribute the
Company's patented GFCI and Immersion Detector Circuit  
      Interrupter ("IDCI") products within the United States, and to
 manufacture the GFCI and IDCI products in certain Asiatic
countries.*                                             

(e)  Incentive Stock Option Plan, dated October 15, 1981.*        

   (f)  The 1993 Incentive Stock Option Plan, which was previously filed
      with and as part of the Registrant's Registration Statement on
Form S-8 (No. 33-62397).                                

    (g)  Non-Qualified Stock Option Agreements, dated as of various dates,
 between the Company and each of its current directors and
        officers, as well as two independent consultants, an independent
     entity which had provided the Company with certain technology
rights and certain former directors.*                   

 (h)  The 1993 Amended and Restated Non-Qualified Stock Option Plan,
       which was previously filed with and as part of the Registrant's
Registration Statement on Form S-8 (No. 33-62379).      

  -21-
(i)  $600,000 Loan Agreement, dated January 8, 1993, between the  
Company and First Union National Bank of Florida.***    

  (j)  License Agreement, dated November 23, 1992, between the Company
        and TEMIC Telefunken Microelectronic GmbH, a German corporation,
 granting Telefunken an exclusive right to manufacture the
Company's ELCI product line in Europe for sale to Xerox 
Corporation, its European affiliates, or its authorized 
suppliers.***                                           

  (k)  $2,500,000 Revolving Credit Agreement, dated November 12, 1993,
        between the Company and First Union National Bank of Florida.***

 (l)  License Agreement, dated May 17, 1997, between the Company and
    Yaskawa Controls Company, Ltd., a Japanese company, granting
          Yaskawa an exclusive right to market and manufacture the Company's
 products developed for use in electrical vehicle charging
systems.***                                             

 (m)  Sales and Marketing Agreement, dated May 17, 1997, between the
       Company and Yaskawa Controls Company, Ltd., a Japanese company,
    granting Yaskawa exclusive sales and marketing rights to the
        Company's full line of commercial electrical protection devices,
        including "Fire Shield", "Shock Shield" and "Electra Shield".***

(23)   Consents of Experts and Counsel:                                         

(a)  Consent of Independent Certified Public Accountants. *****   

*    Previously filed with and as part of the Registrant's Registration 
Statement on Form S-1 (No. 33-24647).                         

**    Previously filed with and as a part of the Registrant's Registration
Statement on Form S-1 (No. 33-31967).                         

***    Previously filed with and as part of the Registrant's Annual Report  
on Form 10-K.                                                 

****    Previously filed with and as part of the Registrant's Post-Effective  
Amendment No. 1 to Form S-1 (No. 33-31967)                    

*****    Filed herewith.                                                        

  -22-
      Independent Auditors' Report
      ----------------------------

The Board of Directors and Stockholders                                         
Technology Research Corporation:                                                

We have audited the consolidated financial statements of Technology Research    
Corporation and subsidiary as listed in the accompanying index.  In connection  
with our audits of the consolidated financial statements, we also have audited  
the financial statement schedule as listed in the accompanying index.  These    
consolidated financial statements and financial statement schedule are the      
responsibility of the Company's management.  Our responsibility is to express   
an opinion on these consolidated financial statements and financial statement   
schedule based on our audits.                                                   

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

In our opinion, the consolidated financial statements referred to above present 
fairly, in all material respects, the financial position of Technology Research 
Corporation and subsidiary as of March 31, 1998 and 1997, and the results of    
their operations and their cash flows for each of the years in the three-year   
period ended March 31, 1998 in conformity with generally accepted accounting    
principles.  Also in our opinion, the related financial statement schedule,     
when considered in relation to the basic consolidated financial statements      
taken as a whole, present fairly, in all material respects, the information set 
forth therein.                                                                  

KPMG PEAT MARWICK LLP                                                           

St. Petersburg, Florida                                                         
May 1, 1998                                                                     

 F-1
     TECHNOLOGY RESEARCH CORPORATION
    AND SUBSIDIARY
     Consolidated Balance Sheets
     March 31, 1998 and 1997

               Assets                                1998         1997
Current assets:                                           ----         ----     
 Cash and cash equivalents                         $  1,153,798    1,307,567
   Short-term investments (note 2)                    1,033,902    3,031,013
Accounts receivable, less allowance for doubtful accounts of          
        $64,700 in 1998 and $69,500 in 1997 (note 6)  2,711,056    2,304,449
   Income tax receivable                                253,019      178,130
   Inventories (notes 3 and 6)                        5,325,409    5,142,768
   Prepaid expenses and other current assets            235,595      178,972
   Deferred income taxes (note 4)                       406,100      411,400
                                                     ----------   ----------
                  Total current assets               11,118,879   12,554,299
                                                     ----------   ----------
Property, plant and equipment (notes 5 and 6)           9,033,808    6,817,411  
    Less accumulated depreciation                     (4,476,692)  (3,859,909)
                                                     ----------   ----------
                  Net property, plant and equipment   4,557,116    2,957,502
                                                     ----------   ----------
Deferred income taxes (note 4)                             55,928      102,120  
Other assets                                               14,895       24,028  
                                                     ----------   ----------
                                                         70,823      126,148
                                                     ----------   ----------
                                                   $ 15,746,818   15,637,949
                                                     ==========   ==========
Liabilities and Stockholders' Equity                                  

Current liabilities:                                                            
   Current installments of debt (note 6)           $  2,525,100      652,999
   Trade accounts payable                             1,216,624    1,607,116
Accrued expenses:                                                     
        Compensation                                    372,218      260,261
        Other                                            83,645       36,288
   Dividends payable                                     45,613      346,490
                                                     ----------   ----------
                  Total current liabilities           4,243,200    2,903,154
Debt, excluding current installments (note 6)             131,250      206,250  
                                                     ----------   ----------
                  Total liabilities                   4,374,450    3,109,404
                                                     ----------   ----------
Stockholders' equity (note 7):                                                  
Common stock, $.51 par value.  Authorized                             
10,000,000 shares; issued and outstanding                             
   5,332,571 in 1998 and 1997                         2,719,611    2,719,611
   Additional paid-in capital                         7,411,581    7,411,581
   Retained earnings                                  1,241,176    2,397,353
                                                     ----------   ----------
                  Total stockholders' equity         11,372,368   12,528,545
                                                     ----------   ----------
Commitments and contingencies (notes 8, 10 and 11)                              
                                                   $ 15,746,818   15,637,949
                                                     ==========   ==========
See accompanying notes to consolidated financial statements.                    

 F-2
     TECHNOLOGY RESEARCH CORPORATION
    AND SUBSIDIARY
     Consolidated Statements of Income
     Years ended March 31, 1998, 1997 and 1996

                                        1998         1997         1996
Operating revenues:                          ----         ----         ----     
 Net sales (note 9)                   $ 18,101,785   15,003,594   16,581,301
 Royalties                                 329,166      381,977      797,920
                                        ----------   ----------   ----------
                                        18,430,951   15,385,571   17,379,221
                                        ----------   ----------   ----------
Operating expenses:                                                             
 Cost of sales                          13,265,505   10,255,597   10,685,614
 Selling, general, and administrative    4,023,205    3,458,872    2,734,096
 Research, development, and engineering  1,223,422    1,147,630      975,568
                                        ----------   ----------   ----------
                                        18,512,132   14,862,099   14,395,278
                                        ----------   ----------   ----------
             Operating income (loss)       (81,181)     523,472    2,983,943
                                        ----------   ----------   ----------
Other income (deductions):                                                      
 Interest and sundry income                131,727      206,944      262,623
  Interest expense                         (136,380)     (33,274)     (41,967)
 Gain on foreign exchange                      191            -            -
                                        ----------   ----------   ----------
                                            (4,462)     173,670      220,656
                                        ----------   ----------   ----------
    Income (loss) before income taxes      (85,643)     697,142    3,204,599

Income taxes (note 4)                        110,671      130,484    1,165,814  
                                        ----------   ----------   ----------
    Net income (loss)                 $   (196,314)     566,658    2,038,785
                                        ==========   ==========   ==========
Basic earnings (loss) per share         $     (.04)         .11          .39    
                                          ====         ====         ====
Diluted earnings (loss) per share       $     (.04)         .10          .38    
                                          ====         ====         ====
Weighted average number of common and                                           
equivalent shares outstanding:                                        
        Basic                            5,332,571    5,321,698    5,281,932
        Diluted                          5,332,571    5,441,620    5,404,885
                                        ==========   ==========   ==========

See accompanying notes to consolidated financial statements.                    

 F-3
     TECHNOLOGY RESEARCH CORPORATION
    AND SUBSIDIARY
     Consolidated Statements of Stockholders' Equity
   Years ended March 31, 1998, 1997 and 1996

                                        Retained
                                        Additional earnings      Total
                         Common stock       paid-in (accumulated stockholders'
                  Shares      Amount    capital    deficit)     equity
Balances at            ------      ------    -------    -------      ------     
March 31, 1995:     5,246,278  $ 2,675,398  7,322,923   2,340,267   12,338,588  

Exercise of stock                                                               
options via exchange                                                        
of 113 common shares                                                        
and cash of $124,870                                                        
for 72,737 new common                                                       
shares               72,624       37,039     87,831           -      124,870

Dividends                   -            -          -  (1,270,681)  (1,270,681) 

Net income                  -            -          -   2,038,785    2,038,785  
                  ---------    ---------  ---------   ---------   ----------
Balances at                                                                     
March 31, 1996:                                                                 
                  5,318,902    2,712,437  7,410,754   3,108,371   13,231,562

Exercise of stock                                                               
options via exchange                                                        
of 667 common shares                                                        
and cash of $8,001 for                                                      
14,336 new common                                                           
shares               13,669        7,174        827           -        8,001

Dividends                   -            -          -  (1,277,676)  (1,277,676) 

Net income                  -            -          -     566,658      566,658  
                  ---------    ---------  ---------   ---------   ----------
Balances at                                                                     
March 31, 1997:     5,332,571    2,719,611  7,411,581   2,397,353   12,528,545  

Dividends                   -            -          -    (959,863)    (959,863) 

Net loss                    -            -          -    (196,314)    (196,314) 
                  ---------    ---------  ---------   ---------   ----------
Balances at                                                                     
March 31, 1998:     5,332,571  $ 2,719,611  7,411,581   1,241,176   11,372,368  
                  =========    =========  =========   =========   ==========

See accompanying notes to consolidated financial statements.                    

 F-4
     TECHNOLOGY RESEARCH CORPORATION
    AND SUBSIDIARY
     Consolidated Statements of Cash Flows
     Years ended March 31, 1998, 1997 and 1996

                                            1998        1997        1996
Cash flows from operating activities:           ----        ----        ----    
Net income (loss)                       $   (196,314)    566,658   2,038,785
Adjustments to reconcile net income (loss)                              
to net cash provided by (used in)                                   
operating activities:                                               
       Accretion of interest                 (114,825)   (185,977)   (216,814)
       Allowance for doubtful accounts         (4,800)    (14,500)    (23,000)
      Depreciation and amortization          622,219     494,292     493,201
      Loss on sale of equipment                    -           -         107
Decrease (increase) in                                          
         accounts receivable                (401,807)    317,203     751,574
       Decrease (increase) in inventories    (182,641)     83,994  (1,280,737)
Increase in prepaid expenses and                                
          other current assets                (56,623)    (84,767)    (57,342)
      Increase in income taxes receivable    (74,889)   (178,130)          -
      Decrease in deferred income taxes       51,492      90,480      64,000
      Decrease (increase) in other assets      3,697     (23,505)     52,812
Increase (decrease) in                                          
          accounts payable                   (390,492)    370,525    (491,741)
Increase (decrease) in                                          
          accrued expenses                    159,314      77,505     (11,133)
        Decrease in income taxes payable            -        (991)    (84,500)
                                           ---------   ---------   ---------
Net cash provided by (used in)                            
            operating activities            (585,669)  1,512,787   1,235,212
                                           ---------   ---------   ---------
Cash flows from investing activities:                                           
Maturities of short-term investments       3,112,000   5,190,000   4,832,000
 Purchases of short-term investments       (1,000,064) (3,950,338) (5,957,756)
Capital expenditures for property,                                          
    plant and equipment                    (2,216,397) (1,030,145)   (599,028)
Proceeds from sale of equipment                    -           -       8,002
                                           ---------   ---------   ---------
Net cash provided by (used in)                            
             investing activities            (104,461)    209,517  (1,716,782)
                                           ---------   ---------   ---------
Cash flows from financing activities:                                           
Net borrowings under line-of-credit                                         
   agreement                               1,872,101     577,899           -
Principal payments on mortgage                                              
    note payable                              (75,000)    (75,000)    (75,000)
Proceeds from exercise of                                                   
   stock options and warrants                      -       8,001     124,870
 Dividends paid                            (1,260,740) (1,267,238)   (934,629)
                                           ---------   ---------   ---------
Net cash provided by (used in)                            
             financing activities             536,361    (756,338)   (884,759)
                                           ---------   ---------   ---------
Net increase (decrease) in cash and                                             
   cash equivalents                          (153,769)    965,966  (1,366,329)

Cash and cash equivalents at                                                    
 beginning of year                         1,307,567     341,601   1,707,930
                                           ---------   ---------   ---------
Cash and cash equivalents at end of year  $  1,153,798   1,307,567     341,601  
                                           =========   =========   =========
Supplemental cash flow information:                                             
Cash paid for interest                  $    136,380      33,274      41,967
                                           =========   =========   =========
Cash paid for income taxes              $    134,068     219,125   1,186,314
                                           =========   =========   =========

See accompanying notes to consolidated financial statements.                    

 F-5
     TECHNOLOGY RESEARCH CORPORATION
    AND SUBSIDIARY

    Notes to Consolidated Financial Statements

     March 31, 1998, 1997 and 1996

(1)     Summary of Significant Accounting Policies                              

(a)     Description of Business                                                 

Technology Research Corporation and subsidiary (the Company) is engaged in the  
design, development, manufacturing, and marketing of electronic control and     
measurement devices related to the distribution of electrical power and         
specializes in electrical safety products that prevent electrical fires and     
protect against electrocution and serious injury from electrical shock.  The    
Company's corporate headquarters are located in Clearwater, Florida.  During    
February 1997, the Company incorporated TRC Honduras, S.A. de C.V., a wholly-   
owned subsidiary, for the purpose of manufacturing the Company's high volume    
products in Honduras beginning in April 1997.  The Company primarily sells its  
products to governmental entities and original equipment manufacturers involved 
in a variety of industries including business machinery and personal care       
appliances.  The Company performs credit evaluations of all new customers and   
generally does not require collateral.  Historically, the Company has           
experienced minimal losses related to receivables from individual customers or  
groups of customers in any particular industry or geographic area.  The         
Company's customers are located throughout the world.  See note 9 for further   
information on major customers.  The Company also licenses its technology for   
use by others in exchange for a royalty or product purchases.  Licensees are    
located in Australia, France, Italy, Japan, the United Kingdom and the United   
States.                                                                         

(b)     Use of Estimates                                                        

Management of the Company has made a number of estimates and assumptions        
relating to the reporting of assets and liabilities and the disclosure of       
contingent assets and liabilities to prepare these financial statements in      
conformity with generally accepted accounting principles.  Actual results could 
differ from those estimates.                                                    

(c)     Foreign Currency Translation                                            

The U.S. dollar is the functional currency of the Honduran subsidiary.  Foreign 
currency denominated assets and liabilities of this subsidiary are translated   
at the rates of exchange at the balance sheet date.  Income and expense items   
are translated at average monthly rates of exchange.  Gains and losses from     
foreign currency transactions of this subsidiary are included in operations.    

(d)     Financial Instruments                                                   

The Company believes the book value of its financial instruments (short-term    
investments, accounts receivable, trade accounts payable, accrued expenses,     
dividends payable, income taxes receivable and payable and debt) approximate    
their fair value due to their short-term nature or with respect to debt, the    
interest rate appropriately reflects the credit risk.                           

 F-6
     TECHNOLOGY RESEARCH CORPORATION
    AND SUBSIDIARY

    Notes to Consolidated Financial Statements

(e)     Principles of Consolidation                                             

The consolidated financial statements include the financial statements of       
Technology Research Corporation and its wholly-owned subsidiary, TRC Honduras,  
S.A. de C.V.  All significant intercompany balances and transactions have been  
eliminated in consolidation.                                                    

(f)     Cash Equivalents                                                        

For purposes of the statements of cash flows, the Company considers all short-  
term investments purchased with a maturity of three months or less to be cash   
equivalents.  There were no short-term investments considered cash equivalents  
at March 31, 1998 or 1997.                                                      

(g)     Short-Term Investments                                                  

The Company considers all of its short-term investments to be "held-to-         
maturity," and therefore, are recorded at amortized cost.                       

(h)     Revenue Recognition                                                     

Sales and cost of sales related to governmental contracts are recognized under  
the unit-of-delivery method, whereby sales and cost of sales are recorded as    
units are delivered.  All other sales and cost of sales are recognized as       
product is shipped.  The Company accrues minimum royalties due over the related 
royalty period.  Royalties earned in excess of minimum royalties due are        
recognized as reported by the licensees.                                        

(i)     Impairment of Long-Lived Assets and                                     
Long-Lived Assets to Be Disposed Of                                   

The Company reviews long-lived assets and certain identifiable intangibles      
whenever events or changes in circumstances indicate that the carrying amount   
of an asset may not be recoverable.  Recoverability of assets to be held and    
used is measured by a comparison of the carrying amount of an asset to future   
net cash flows expected to be generated by the asset.  If such assets are       
considered to be impaired, the impairment to be recognized is measured by the   
amount by which the carrying amount of the assets exceed the fair value of the  
assets.  Assets to be disposed of are reported at the lower of the carrying     
amount or fair value, less costs to sell.                                       

(j)     Inventories                                                             

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

 F-7
     TECHNOLOGY RESEARCH CORPORATION
    AND SUBSIDIARY

    Notes to Consolidated Financial Statements

(k)     Property, Plant and equipment                                           

Property, plant and equipment are stated at cost.  Depreciation is calculated   
on the straight-line method over the estimated useful lives of the assets.      

(l)     Income Taxes                                                            

Deferred tax assets and liabilities are recognized for the future tax           
consequences attributable to differences between the financial statement        
carrying amounts of existing assets and liabilities and their respective tax    
bases and operating loss tax credit carryforwards.  Deferred tax assets and     
liabilities are measured using enacted tax rates expected to apply to taxable   
income in the years in which those temporary differences are expected to be     
recovered or settled.  The effect on deferred tax assets and liabilities of a   
change in tax rates is recognized in income in the period that includes the     
enactment date.                                                                 

(m)     Stock-Based Compensation                                                

Prior to April 1, 1996, the Company accounted for its stock option plan in      
accordance with the provisions of Accounting Principles Board Opinion No. 25    
(APB 25), Accounting for Stock Issued to Employees, and related                 
interpretations.  As such, compensation expense would be recorded on the date   
of grant only if the current market price of the underlying stock exceeded the  
exercise price.  On April 1, 1996, the Company adopted Statement of Financial   
Accounting Standards No. 123 (SFAS 123), Accounting for Stock-Based             
Compensation, which permits entities to recognize as expense over the vesting   
period the fair value of all stock-based awards on the date of grant.           
Alternatively, SFAS 123 also allows entities to continue to apply the           
provisions of APB 25 and provide pro forma net income and pro forma earnings    
per share disclosures for employee stock option grants made in 1995 and future  
years as if the fair-value-based method defined in SFAS 123 had been applied.   

The Company has elected to continue to apply the provisions of APB 25 and       
provide the pro forma disclosure provisions of SFAS 123 (see note 7).           

(n)     Earnings Per Share                                                      

The Company calculates basic and diluted earning (loss) per share in accordance 
with SFAS 128, Earnings Per Share, which is effective for periods ending after  
December 15, 1997.  SFAS 128 replaces the presentation of primary earnings per  
share and fully diluted earnings per share previously found in APB 15, Earnings 
Per Share with basic earnings per share and diluted earnings per share.         

Basic earnings per share has been computed by dividing net income by the        
weighted average number of common shares outstanding.  Common share equivalents 
included in the dilutive weighted average shares outstanding computation        
represent shares issuable upon assumed exercise of stock options and            
convertible debt which would have a dilutive effect in years where there are    
earnings.                                                                       

 F-8
     TECHNOLOGY RESEARCH CORPORATION
    AND SUBSIDIARY

    Notes to Consolidated Financial Statements

(o)     Year 2000                                                               

The Company has developed a plan to deal with the Year 2000 problem and has     
begun converting its computer systems to be Year 2000 compliant.  The plan      
provides for the conversion efforts to be completed by the end of 1999.  The    
Year 2000 problem is the result of computer programs being written using two    
digits rather than four to define the applicable year.  The total cost of the   
project is being funded through operating cash flows.  The Company is expensing 
all costs associated with these system changes as the costs are incurred.       

(2)     Short-Term Investments                                                  

The Company considers all of its investment securities to be held-to-maturity.  
These securities are all classified in short-term investments on the            
consolidated balance sheets and mature within one year.  The amortized cost,    
gross unrealized holding gains, gross unrealized holding losses, and fair value 
for held-to-maturity securities at March 31, 1998 and 1997 were as follows:     

                                      Gross unrealized
                                Amortized          holding          Fair
                                   cost         Gains     Losses     value
                                   ----         -----     ------     -----
March 31, 1998 -                                                                
    U.S. Treasury securities     $ 1,033,902        -          -     1,033,902
                                   =========      ======    ======   =========
March 31, 1997 -                                                                
    U.S. Treasury securities     $ 3,031,013        -          -     3,031,013
                                   =========      ======    ======   =========

(3)     Inventories                                                             

Inventories at March 31, 1998 and 1997 consist of:                              

                                        1998          1997
                                        ----          ----

Raw materials                            $ 4,499,524     3,138,639    
Work in process                              387,170     1,309,312    
Finished goods                               438,715       694,817    
                                       ---------     ---------
                                     $ 5,325,409     5,142,768
                                       =========     =========

At March 31, 1998, approximately 27% of inventories were located in Honduras.   
At March 31, 1997, approximately 16% of inventories were located in China.      

 F-9
     TECHNOLOGY RESEARCH CORPORATION
    AND SUBSIDIARY

    Notes to Consolidated Financial Statements

(4)     Income Taxes                                                            

The tax effects of temporary differences that give rise to significant portions 
of the deferred tax assets and deferred tax liabilities at March 31, 1998 and   
1997 are presented below:                                                       

                                                     1998       1997
                                                     ----       ----
Deferred tax assets:                                                            
Accounts receivable, principally due to                               
      allowance for doubtful accounts             $    23,300     25,000
Inventories, principally due to valuation                             
allowance for financial reporting purposes                  
and additional costs inventoried for                        
      tax purposes                                    252,500    281,000
Accrued expenses, principally due to accrual                          
      for financial reporting purposes                 65,600     41,000
 Net operating loss carryforwards                     182,000    249,000
 Tax credit carryforwards                             214,000    214,000
                                                     --------   --------
           Total gross deferred tax assets            737,400    810,000

            Less valuation allowance                  (187,000)  (187,000)
                                                     --------   --------
                                                      550,400    623,000
                                                     --------   --------
Deferred tax liabilities:                                                       
Property, plant and equipment, principally                            
       due to differences in depreciation              (88,372)  (106,000)
  Other                                                      -     (3,480)
                                                     --------   --------
                                                       (88,372)  (109,480)
                                                     --------   --------
           Net deferred tax assets                $   462,028    513,520
                                                     ========   ========

Net deferred tax assets are included in the accompanying balance sheets at      
March 31, 1998 and 1997 as:                                                     

                                                     1998       1997
                                                     ----       ----
Deferred income taxes, current asset                  $   406,100    411,400    
Deferred income taxes, noncurrent asset                    55,928    102,120    
                                                     --------   --------
                                                  $   462,028    513,520
                                                     ========   ========

  F-10
     TECHNOLOGY RESEARCH CORPORATION
    AND SUBSIDIARY

    Notes to Consolidated Financial Statements

Management assesses the likelihood deferred tax assets will be realized which   
is dependent upon the generation of taxable income during the periods in which  
those temporary differences are deductible.  Management considers historical    
taxable income, the scheduled reversal of deferred tax liabilities, projected   
future taxable income, and tax planning strategies in making this assessment.   
In order to fully realize the deferred tax asset related to net operating loss  
and tax credit carryforwards, the Company will need to generate future taxable  
income of approximately $170,000 each year prior to the expiration of the net   
operating loss and tax credit carryforwards in 2003 and 2002, respectively.     
Based upon the level of historical taxable income and projections for future    
taxable income, management believes it will realize the benefits of these       
deductible differences, net of the existing valuation allowance at March 31,    
1998.  The valuation allowance at March 31, 1998 and 1997 relates to tax credit 
carryforwards which management expects to expire unused.                        

At March 31, 1998, the Company has net operating loss carryforwards for Federal 
income tax purposes of approximately $476,000, which are available to offset    
future taxable income through 2003.  The Company also has available tax credit  
carryforwards for Federal income tax purposes of approximately $214,000, which  
are available to offset future Federal income taxes through 2002.  As a result  
of an ownership change in 1989, the Internal Revenue Code limits the income tax 
benefit of net operating loss and tax credit carryforwards to approximately     
$65,000 each year.                                                              

Income tax expense for the years ended March 31, 1998, 1997 and 1996 consists   
of:                                                                             

                                            1998        1997        1996
                                            ----        ----        ----
Current:                                                              
        Federal                           $   59,179     156,748     936,214
        State                                      -    (116,744)    165,600
                                            --------    --------   ---------
                                              59,179      40,004   1,101,814
                                            --------    --------   ---------
Deferred:                                                             
        Federal                               48,600      77,000      55,000
        State                                  2,892      13,480       9,000
                                            --------    --------   ---------
                                              51,492      90,480      64,000
                                            --------    --------   ---------
                                          $  110,671     130,484   1,165,814
                                            ========    ========   =========

  F-11
     TECHNOLOGY RESEARCH CORPORATION
    AND SUBSIDIARY

    Notes to Consolidated Financial Statements

Income tax expense for the years ended March 31, 1998, 1997 and 1996 differs    
from the amounts computed by applying the Federal income tax rate of 34% to     
pretax income as a result of the following:                                     

                                            1998        1997        1996
                                            ----        ----        ----
Computed expected tax (benefit) expense     $  (29,000)    237,000   1,090,000  
Increase (reduction) in income taxes                                            
resulting from:                                                       
Foreign losses for which no                                 
income tax benefit has been                       
             provided                        128,000           -           -
State income taxes, net of                                  
             Federal income tax benefit        2,000     (68,000)    115,000
         Other                                  9,671     (38,516)    (39,186)
                                            --------    --------   ---------
                                          $  110,671     130,484   1,165,814
                                            ========    ========   =========

The operating results of the foreign manufacturing subsidiary are not subject   
to foreign tax since it is operating under a tax holiday for at least twenty    
years.  The foreign operations resulted in losses for the year ended March 31,  
1998 of approximately $375,000 because of the tax holiday.  No tax benefit of   
the loss has been provided.                                                     

(5)     Property, Plant and equipment                                           

Property, plant and equipment at March 31, 1998 and 1997 consists of:           

                                                                 Estimated
                                            1998        1997      useful lives
                                            ----        ----      ------------
  Building and improvements         $  1,512,205   1,458,716      20 years
    Machinery and equipment              7,521,603   5,358,695    5 - 15 years
                                         ---------   ---------    ------------
                      $  9,033,808   6,817,411
                         =========   =========

Approximately 20% of property, plant and equipment is located in Honduras.      

  F-12
     TECHNOLOGY RESEARCH CORPORATION
    AND SUBSIDIARY

    Notes to Consolidated Financial Statements

(6)     Debt                                                                    

Debt at March 31, 1998 and 1997 consists of the following:                      

                                                         1998       1997
                                                         ----       ----
$2,500,000 line of credit, interest at LIBOR plus 200                           
basis points (7.69% at March 31, 1998); payable                       
monthly, due September 1998; secured by receivables,                  
inventories and equipment (subject to provisions                      
   stated below)                                      $ 2,450,100    577,999

First mortgage note payable; interest at LIBOR plus 200                         
basis points at March 31, 1998 and prime at March 31,                 
1997 (7.69% at March 31, 1998 and 1997); due in                       
monthly installments of $6,250, plus interest, matures                
   December 2000; secured by operating facility           206,250    281,250
                                                        ---------  ---------
        Total debt                                      2,656,350    859,249

    Less current installments                           (2,525,100)  (652,999)
                                                        ---------  ---------
        Debt, excluding current installments          $   131,250    206,250
                                                        =========  =========

Borrowings under the line of credit are limited to 80% of eligible accounts     
receivable under 90 days, plus the lesser of 40% of eligible inventory or       
$450,000.  The line of credit is secured by receivables, inventories, and       
equipment, and requires the Company to maintain certain financial ratios and a  
minimum tangible net worth amount.                                              

The aggregate maturities of long-term debt are:                                 

Year ending March 31,                                         
---------------------                                         
1999                             $  2,525,100   
2000                                   75,000   
2001                                   56,250   
                                 ---------
                              $  2,656,350
                                 =========

  F-13
     TECHNOLOGY RESEARCH CORPORATION
    AND SUBSIDIARY

    Notes to Consolidated Financial Statements

(7)     Stock Options, Grants and Warrants                                      

The Company has two qualified incentive stock option plans, one performance     
incentive stock option plan, and one nonqualified stock option plan (the        
Plans).  Options granted under the Plans are granted to directors, officers and 
employees at fair value and expire ten years after the date of grant.  Except   
for the Performance Plan, options granted under the Plans generally vest over   
three years.  Options granted under the Performance Plan vest at the end of     
year ten but are subject to accelerated vesting if certain targets are met.     
Options may be exercised by payment of cash or with stock of the Company owned  
by the officer or employee.                                                     

Option transactions and other information relating to the Plans for the three   
years ended March 31, 1998 are as follows:                                      

    Qualified Performance Non-
                            incentive  incentive qualified            Weighted
                             stock     stock     stock               average
                              option    option    option              exercise
                            plans     plan      plan        Total    price
                              -------   -------  -------   ---------  --------
Outstanding at March 31, 1995  220,456      -     181,428     401,884    $ 3.04 
    Granted                     9,800      -      29,474      39,274      5.44
    Exercised                 (58,737)     -     (14,000)    (72,737)     1.64
    Canceled                  (67,866)     -        -        (67,866)     4.31
                              -------   -------  -------   ---------  --------
Outstanding at March 31, 1996  103,653      -     196,902     300,555      3.91 
    Granted                    50,750   400,000   10,000     460,750      5.08
    Exercised                  (6,002)     -      (8,334)    (14,336)     0.75
    Canceled                   (1,234)     -        -         (1,234)     5.46
                              -------   -------  -------   ---------  --------
Outstanding at March 31, 1997  147,167   400,000  198,568     745,735      4.70 
    Granted                     1,000      -        -          1,000      4.31
    Canceled                  (14,020)     -      (2,000)    (16,020)     5.29
                              -------   -------  -------   ---------  --------
Outstanding at March 31, 1998  134,147   400,000  196,568     730,715      4.34 
                              =======   =======  =======   =========  ========
Total number of options available                                               
under the plans           713,334   400,000  333,333   1,446,667      
                    =======   =======  =======   =========
Exercisable at March 31, 1998   90,068      -     189,635     279,703      3.13 
                    =======   =======  =======   =========
Available for issue                                                             
 at March 31, 1998    8,384      -      28,541      36,925
                    =======   =======  =======   =========

The per share weighted average fair value of stock options granted during 1998  
and 1997 was $1.85 and $2.14, respectively, on the date of grant using the      
Black Scholes option pricing model, with the following assumptions:  (1) risk   
free interest rate - 6.17% to 6.85%, (2) expected life - 6.5 to 10 years, (3)   
expected volatility - 72% to 75%, and (4) expected dividends - 5.1% to 5.8%.    

  F-14
     TECHNOLOGY RESEARCH CORPORATION
    AND SUBSIDIARY

    Notes to Consolidated Financial Statements

At March 31, 1998, the range of exercise prices and weighted average remaining  
contractual life of options outstanding and exercisable was as follows:         

           Options Outstanding                     Options Exercisable
-------------------------------------------------  ---------------------------- 
               Number     Weighted average  Weighted     Number       Weighted
Range of      outstanding     remaining      average    exercisable    average  
exercise        as of        contractual     exercise      as of       exercise 
prices      March 31, 1998      life          price    March 31, 1998   price   
--------    -------------   --------------  ---------  --------------  -------- 
$4.13 - $5.53   134,147         6.86           5.19        90,068          5.38 
$5.12           400,000         8.25           5.12       400,000          5.12 
$ .75             8,334         3.61            .75         8,334           .75 
$1.31 - $1.37   145,766          .65           1.36       145,766          1.36 
$4.88 - $5.53    42,468         7.49           5.33        35,535          5.33 

The Company grants options at fair value and applies APB 25 in accounting for   
its Plans.  Accordingly, no compensation cost has been recognized for stock     
options in the financial statements.  Had the Company determined compensation   
cost based on the fair value at the grant date for its stock options under SFAS 
123, the Company's net income at March 31, 1998 and 1997 would have been        
reduced to the pro forma amounts indicated below:                               

                                            1998        1997        1996
                                            ----        ----        ----
Net income (loss):                                            
           As reported                   $  (196,314)    566,658   2,038,785
                                           =========   =========   =========
           Pro forma                     $  (223,516)    476,123   2,016,755
                                           =========   =========   =========
Income (loss) per common share:                               
        As reported                    $    (.04)        .10         .38
                                            ====        ====        ====
        Pro forma                      $    (.04)        .09         .37
                                            ====        ====        ====

Pro forma net income reflects only options granted in 1998, 1997 and 1996.      
Therefore, the full impact of calculating compensation costs for stock options  
under SFAS 123 is not reflected in the pro forma net income amounts presented   
above because compensation cost is reflected over the options' vesting period   
of three to ten years, and compensation costs for options granted prior to      
April 1, 1995 are not considered.                                               

The Company has also reserved 32,667 shares of its common stock for issuance to 
employees or prospective employees at the discretion of the Board of Directors  
of which 16,033 shares are available for future issue.  There were no reserved  
shares issued during the years ended March 31, 1998, 1997 or 1996.              

  F-15
     TECHNOLOGY RESEARCH CORPORATION
    AND SUBSIDIARY

    Notes to Consolidated Financial Statements

(8)     Leases                                                                  

The Company leases the land on which its operating facility is located.  This   
operating lease is for a period of twenty years through 2001 with options to    
renew for two additional ten-year periods.  The lease provides for rent         
adjustments every five years.  The Company is responsible for payment of taxes, 
insurance, and maintenance.  In the event the Company elects to terminate the   
lease, title to all structures on the land reverts to the lessor.  The          
Company's subsidiary leases its operating facility in Honduras.  This operating 
lease is for five years through the year 2002, with an option to renew for an   
additional five-year term.  The Company also leases certain office equipment    
under long-term operating lease agreements.                                     

Future minimum lease payments under noncancelable operating leases as of March  
31, 1998 are:                                                                   

Year ending March 31,                                         
---------------------                                         
1999                             $  249,000     
2000                                243,000     
2001                                224,000     
2002                                206,000     
Thereafter                              17,000        
                              --------
Total minimum lease payments                $  939,000                
                              ========

Rental expense for all operating leases was approximately $76,000 in 1998,      
$80,000 in 1997 and $56,000 in 1996.                                            

(9)     Major Customers                                                         

The Company operates in one business segment - the design, development,         
manufacture and marketing of electronic control and measurement devices for the 
distribution of electric power.                                                 

Significant customers which accounted for 10% or more of sales and aggregate    
exports were:                                                                   

                                             Year ended March 31
                                             -------------------
 Customer                                   1998        1997        1996
 --------                                   ----        ----        ----
   Xerox Corporation                    $  2,838,905   2,529,398   1,686,421
Noma Appliance & Electric, Inc.,                                      
f/k/a Fleck Manufacturing, Inc.                             
        (a Xerox Corporation supplier)     1,666,516   1,776,424   2,358,887
   Other Xerox Corporation suppliers         133,044     802,800   2,474,142
   Fermont Division                        2,817,079           -           -
                                           ---------   ---------   ---------
                                        $  7,455,544   5,108,622   6,519,450

  F-16
     TECHNOLOGY RESEARCH CORPORATION
    AND SUBSIDIARY

    Notes to Consolidated Financial Statements

                                             Year ended March 31
                                             -------------------
 Customer                                   1998        1997        1996
 --------                                   ----        ----        ----
Exports:                                                              
        Canada                          $  1,894,215   1,831,898   2,367,890
        Far East                             486,277   1,057,605   1,967,494
        Europe                             2,554,772   1,396,823   1,750,257
        Mexico                               979,187     736,992     569,845
        Australia                            218,530     150,760     438,875
        South America                         20,994      82,838           -
        Middle East                            3,397       5,324           -
                                           ---------   ---------   ---------
             Total exports              $  6,157,372   5,262,240   7,094,361
                                           =========   =========   =========

(10)     Benefit Plan                                                           

The Company's 401(k) plan covers all employees with one year of service who are 
at least twenty-one years old.  The Company matches employee contributions      
dollar-for-dollar up to $300.  Total Company contributions were approximately   
$29,000 in 1998, $25,000 in 1997 and $19,000 in 1996.                           

(11)     Litigation                                                             

The Company is involved in various other claims and legal actions arising in    
the ordinary course of business.  In the opinion of management, the ultimate    
disposition of these matters will not have a material adverse effect on the     
Company's consolidated financial position, results of operations or liquidity.  

  F-17
     TECHNOLOGY RESEARCH CORPORATION
    AND SUBSIDIARY

    Notes to Consolidated Financial Statements

(12)     Selected Quarterly Data (Unaudited)                                    

Information (unaudited) related to operating revenues, operating income, net    
income and earnings per share, by quarter, for the years ended March 31, 1998   
and 1997 are:                                                                   

                                First     Second      Third     Fourth
                                quarter    quarter    quarter    quarter
                                -------    -------    -------    -------
Year ended March 31, 1998:                                                      
  Operating revenues         $  4,811,585  4,545,950  4,658,113  4,415,303
                                =========  =========  =========  =========

  Gross profit               $  1,488,247  1,336,956  1,140,074    871,003
                                =========  =========  =========  =========

   Operating income (loss)    $    467,494    106,385   (145,509)  (509,551)
                                =========  =========  =========  =========

   Net income (loss)          $    326,315     74,019   (130,444)  (466,204)
                                =========  =========  =========  =========

 Basic earnings per share   $      .06        .01       (.02)      (.09)
                                 ====       ====       ====       ====

 Diluted earnings per share $      .06        .01       (.02)      (.09)
                                 ====       ====       ====       ====

Year ended March 31, 1997:                                                      
  Operating revenues         $  3,377,467  3,688,927  3,879,627  4,439,550
                                =========  =========  =========  =========

  Gross profit               $    974,406  1,189,761  1,072,710  1,511,120
                                =========  =========  =========  =========

  Operating income           $     58,541    255,499    168,095     41,337
                                =========  =========  =========  =========

  Net income                 $     71,027    301,917    144,073     49,641
                                =========  =========  =========  =========

Basic earnings per share   $      .01        .05        .03        .01
                                 ====       ====       ====       ====

Diluted earnings per share $      .01        .05        .03        .01
                                 ====       ====       ====       ====

The fourth quarter of the year ended March 31, 1998 was adversely affected by   
an approximately $270,000 reduction in inventory as a result of the Company's   
physical inventory.  It is not practicable to determine what, if any, other     
quarters are affected by this adjustment.                                       

  F-18
     TECHNOLOGY RESEARCH CORPORATION
    AND SUBSIDIARY

   Schedule II

     Valuation and Qualifying Accounts

     Years ended March 31, 1998, 1997 and 1996

       Additions
        ----------------------
                 Balances at  Charged to  Charged to              Balances
                   beginning   costs and     other                 at end of
 Description     of period    expenses    accounts  Deductions    period
   -----------    ----------   ----------  ---------- ----------   ---------
Allowance for                                                                   
doubtful accounts:                                                        
Year ended                                                                
 March 31, 1998  $   69,500         -          -         4,800        64,700
                    =======       =====      =====      ======        ======
Year ended                                                                
 March 31, 1997  $   84,000         -          -        14,500        69,500
                    =======       =====      =====      ======        ======
Year ended                                                                
 March 31, 1996  $  107,000         -          -        23,000        84,000
                    =======       =====      =====      ======        ======

  F-19
SIGNATURES                                                                      

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

                       TECHNOLOGY RESEARCH CORPORATION

Dated:      6/27/1998               By:  /s/ Robert S. Wiggins                  
                           Robert S. Wiggins
                                 Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this       
report has been signed below by the following persons in the capacities and     
on the dates indicated:                                                         

Signature                   Title                   Date

         Chairman, Chief Executive
     Officer, and Director
/s/ Robert S. Wiggins                                          6/27/1998      
Robert S. Wiggins                                                     

/s/ Raymond H. Legatti         President and Director          6/26/1998      
Raymond H. Legatti                                                    

/s/ Edmund F. Murphy, Jr.      Director                        6/23/1998      
Edmund F. Murphy, Jr.                                                 

/s/ Jerry T. Kendall           Director                        6/17/1998      
Jerry T. Kendall                                                      

     Senior Vice President
     Government Operations
 and Marketing and
/s/ Raymond B. Wood            Director                        6/26/1998      
Raymond B. Wood                                                       

  -23-

Dates Referenced Herein   and   Documents Incorporated By Reference

This 10-K405 Filing		Date		Other Filings
		3/31/92
		11/23/92
		1/8/93
		11/12/93
		3/31/95
		4/1/95
		8/23/95
		9/15/95
		3/31/96		10-K405, DEF 14A
		4/1/96
		6/30/96		10-Q
		8/20/96
		9/24/96
		10/1/96
		2/3/97
		3/31/97		10-K405, DEF 14A
		4/24/97
		5/17/97
		8/1/97
		12/15/97
		3/16/98
For The Period Ended		3/31/98		DEF 14A
		5/1/98
		5/29/98
Filed On / Filed As Of		6/29/98
		8/15/98
		8/20/98
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