Form 10-Q

                       SECURITIES AND EXCHANGE COMMISSION
                                WASHINGTON, D.C.

[Mark one]

[X]   Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act
      of 1934

                       For quarter ended December 31, 2004

                                       OR

[ ]   Transition Report Pursuant to Section 13 or 15(d) of the Securities
      Exchange Act of 1934

            For the transition period from __________ to ___________

                         Commission file number 1-9334

                        BALDWIN TECHNOLOGY COMPANY, INC.
              ----------------------------------------------------
             (Exact name of registrant as specified in its charter)

             Delaware                                  13-3258160
-------------------------------             -----------------------------------
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
incorporation or organization)

          Twelve Commerce Drive, Shelton, Connecticut            06484
         --------------------------------------------------------------
         (Address of principal executive offices)            (Zip Code)

        Registrant's telephone number, including area code: 203-402-1000
        ----------------------------------------------------------------
              (Former name, former address and former fiscal year,
                         if changed since last report)

      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 Act of 1934 during
the preceding 12 months (or 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 whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act).

      YES [ ]              NO [X]

                      APPLICABLE ONLY TO CORPORATE ISSUERS:

      Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.

        Class                   Outstanding at January 31, 2005
---------------------           -------------------------------
Class A Common Stock
      $0.01 par value                      12,945,147

Class B Common Stock
      $0.01 par value                      1,965,419



                        BALDWIN TECHNOLOGY COMPANY, INC.

                                      INDEX



                                                                                           Page
                                                                                           ----
                                                                                        
Part I  Financial Information

        Item 1   Financial Statements

                 Consolidated Balance Sheets at December 31, 2004 (unaudited) and
                 June 30, 2004                                                              1-2

                 Consolidated Statements of Income for the three
                 and six months ended December 31, 2004 (unaudited)
                 and 2003 (unaudited)                                                        3

                 Consolidated Statements of Changes in Shareholders'
                 Equity for the six months ended December 31, 2004 (unaudited)               4

                 Consolidated Statements of Cash Flows for the six
                 months ended December 31, 2004 (unaudited) and
                 2003 (unaudited)                                                           5-6

                 Notes to Consolidated Financial Statements (unaudited)                     7-15

        Item 2   Management's Discussion and Analysis of Financial Condition and
                 Results of Operations                                                     16-22

        Item 3   Quantitative and Qualitative Disclosures About
                 Market Risk                                                                 22

        Item 4   Controls and Procedures                                                     22

Part II          Other Information

        Item 2   Purchases of Equity Securities of Issuer and Affiliated Purchases           23

        Item 6   Exhibits                                                                    23

Signatures                                                                                   24




                        BALDWIN TECHNOLOGY COMPANY, INC.

                           CONSOLIDATED BALANCE SHEETS
                                 (IN THOUSANDS)
                                   (UNAUDITED)

                                     ASSETS



                                                                                    December 31, 2004       June 30, 2004
                                                                                    -----------------       -------------
                                                                                                      
CURRENT ASSETS:
 Cash and cash equivalents                                                            $      12,667         $      12,008
 Accounts receivable trade, net of allowance for doubtful
    accounts of $2,211 ($2,155 at June 30, 2004)                                             26,488                24,765
  Notes receivable, trade                                                                    12,225                12,960
  Inventories, net                                                                           27,778                24,998
  Deferred taxes                                                                                494                   473
  Prepaid expenses and other                                                                  5,195                 5,448
                                                                                      -------------         -------------
                  Total Current Assets                                                       84,847                80,652
                                                                                      -------------         -------------

MARKETABLE SECURITIES:
 Cost $643 ($586 at June 30, 2004)                                                              648                   640
                                                                                      -------------         -------------

PROPERTY, PLANT AND EQUIPMENT, at cost:
 Land and buildings                                                                           1,116                   977
 Machinery and equipment                                                                      3,930                 3,314
 Furniture and fixtures                                                                       4,336                 3,741
 Leasehold improvements                                                                         432                   408
 Capital leases                                                                                 416                   371
                                                                                      -------------         -------------
                                                                                             10,230                 8,811
 Less:  Accumulated depreciation and amortization                                            (5,558)               (4,271)
                                                                                      -------------         -------------
Net Property, Plant and Equipment                                                             4,672                 4,540
                                                                                      -------------         -------------

PATENTS, TRADEMARKS AND ENGINEERING DRAWINGS, at cost, less accumulated
  amortization of $4,443 ($4,224 at June 30, 2004)
                                                                                              2,424                 2,259

GOODWILL, less accumulated amortization of $3,760 (3,227 at June 30, 2004)
                                                                                             11,963                11,104

DEFERRED TAXES                                                                               12,254                12,151

OTHER ASSETS                                                                                  4,617                 3,925
                                                                                      -------------         -------------

TOTAL ASSETS                                                                          $     121,425         $     115,271
                                                                                      =============         =============


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

                                       1



                        BALDWIN TECHNOLOGY COMPANY, INC.

                           CONSOLIDATED BALANCE SHEETS
                 (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
                                   (UNAUDITED)

                      LIABILITIES AND SHAREHOLDERS' EQUITY



                                                                         December 31, 2004              June 30, 2004
                                                                         -----------------              -------------
                                                                                                  
CURRENT LIABILITIES:
   Loans payable                                                         $          2,929               $       2,757
   Current portion of long-term debt                                                1,131                      20,523
   Accounts payable, trade                                                         14,055                      11,615
   Notes payable, trade                                                            11,035                      10,840
   Accrued salaries, commissions, bonus and profit-sharing                          5,512                       6,808
   Customer deposits                                                                3,662                       2,785
   Accrued and withheld taxes                                                       2,104                       2,184
   Income taxes payable                                                             2,166                       3,079
   Other accounts payable and accrued liabilities                                  11,307                      11,687
                                                                         ----------------               -------------
                  Total current liabilities                                        53,901                      72,278
                                                                         ----------------               -------------

LONG TERM LIABILITIES:
   Long-term debt                                                                  22,947                       1,794
   Other long-term liabilities                                                      7,242                       6,732
                                                                         ----------------               -------------
                  Total long-term liabilities                                      30,189                       8,526
                                                                         ----------------               -------------
                  Total liabilities                                                84,090                      80,804
                                                                         ----------------               -------------

SHAREHOLDERS' EQUITY:
   Class A Common Stock, $.01 par, 45,000,000 shares authorized,
     16,575,349 shares issued (16,529,348 shares at June 30, 2004)                    166                         166
   Class B Common Stock, $.01 par, 4,500,000 shares authorized,
     2,137,883 shares issued (2,137,883 shares at June 30, 2004)                       21                          21
   Capital contributed in excess of par value                                      57,065                      57,017
   Accumulated Deficit                                                            (11,160)                    (12,667)
   Accumulated other comprehensive income                                           3,964                       2,651
   Less: Treasury stock, at cost:
     Class A - 3,630,202 shares, Class B - 172,464 shares at
       December 31, 2004 and June 30, 2004                                        (12,721)                    (12,721)
                                                                         ----------------               -------------
                  Total shareholders' equity                                       37,335                      34,467
                                                                         ----------------               -------------

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                               $        121,425               $     115,271
                                                                         ================               =============


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

                                       2



                        BALDWIN TECHNOLOGY COMPANY, INC.

                        CONSOLIDATED STATEMENTS OF INCOME
                      (IN THOUSANDS, EXCEPT PER SHARE DATA)
                                   (UNAUDITED)



                                                                      For the three months             For the six months
                                                                       ended December 31,              ended December 31,
                                                                  ----------------------------    ----------------------------
                                                                      2004             2003           2004             2003
                                                                  -----------      -----------    -----------      -----------
                                                                                                       
Net Sales                                                         $    41,232      $    39,443    $    81,229      $    73,954
Cost of goods sold                                                     28,525           26,646         56,431           50,388
                                                                  -----------      -----------    -----------      -----------
Gross Profit                                                           12,707           12,797         24,798           23,566
                                                                  -----------      -----------    -----------      -----------
Operating Expenses:
 General and administrative                                             3,959            4,670          7,950            8,311
 Selling                                                                3,623            3,305          6,965            5,978
 Engineering and development                                            3,864            3,315          7,222            6,558
 Restructuring charges                                                      -               43              -              425
                                                                  -----------      -----------    -----------      -----------
                                                                       11,446           11,333         22,137           21,272
                                                                  -----------      -----------    -----------      -----------
Operating income                                                        1,261            1,464          2,661            2,294
                                                                  -----------      -----------    -----------      -----------
Other (income) expense:
 Interest expense                                                         571            1,418          1,523            2,355
 Interest income                                                          (30)             (30)           (53)             (56)
 Royalty income, net                                                     (763)            (900)        (1,517)          (1,551)
 Other (income) expense, net                                              137           (1,038)           124           (1,630)
                                                                  -----------      -----------    -----------      -----------
                                                                          (85)            (550)            77             (882)
                                                                  -----------      -----------    -----------      -----------
 Income before income taxes                                             1,346            2,014          2,584            3,176

Provision for income taxes                                                558              790          1,077            1,273
                                                                  -----------      -----------    -----------      -----------
Net income                                                        $       788      $     1,224    $     1,507      $     1,903
                                                                  ===========      ===========    ===========      ===========

Net income (loss) per share - basic and diluted
   Income per share - basic                                       $      0.05      $      0.08    $      0.10      $      0.13
   Income per share - diluted                                            0.05             0.08           0.10             0.13
                                                                  -----------      -----------    -----------      -----------

Weighted average shares outstanding:
   Basic                                                               14,901           15,015         14,887           15,015
                                                                  ===========      ===========    ===========      ===========
   Diluted                                                             15,319           15,245         15,335           15,130
                                                                  ===========      ===========    ===========      ===========


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

                                       3



                        BALDWIN TECHNOLOGY COMPANY, INC.

           CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
                    (IN THOUSANDS, EXCEPT SHARES) (UNAUDITED)



                                       Class B Common    Capital                Accumulated
                 Class A Common Stock      Stock       Contributed                 Other           Treasury Stock      Comprehensive
                 -------------------- ---------------- in Excess of Accumulated Comprehensive  ----------------------- -------------
                  Shares      Amount   Shares   Amount     Par        Deficit   Income (loss)    Shares       Amount   Income (loss)
                 ----------  -------- --------- ------ ------------ ----------- -------------  -----------  ---------- -------------
                                                                                         
Balance at
  June 30, 2004  16,529,348  $    166 2,137,883 $   21  $    57,017 $  (12,667) $       2,651  (3,802,666)  $ (12,721)

Net income for
  the six months
  ended December
  31, 2004                                                               1,507                                         $      1,507

Translation
  adjustment                                                                            1,359                                 1,359

Unrealized gain
  on available-
  for-sale
  securities,
  net of tax                                                                              (28)                                  (28)

Unrealized loss
  on forward
  contracts, net
  of tax                                                                                  (18)                                  (18)
                                                                                                                       ------------
Comprehensive
  Income                                                                                                               $       2,820
                                                                                                                       ============
Shares issued
  under Stock
  Option Plan        46,001                                      48          
                 ----------  -------- --------- ------ ------------ ----------  -------------  ----------   ---------
Balance at
December 31,2004 16,575,349  $    166 2,137,883 $   21 $     57,065 $  (11,160) $       3,964  (3,802,666)  $ (12,721)
                 ==========  ======== ========= ====== ============ ==========  =============  ==========   =========


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

                                       4



                        BALDWIN TECHNOLOGY COMPANY, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)
                                   (UNAUDITED)



                                                                        For the six months ended
                                                                              December 31,
                                                                 --------------------------------------
                                                                      2004                   2003
                                                                 --------------          --------------
                                                                                   
Cash flows from operating activities:
 Net income                                                      $        1,507          $        1,903
 Adjustments to reconcile net income to net cash
    provided by operating activities:
     Depreciation and amortization                                          972                     913
     Accrued retirement pay                                                  80                     197
     Provision for losses on accounts receivable                             51                      29
     Restructuring charges                                                    -                     425
     Deferred income taxes                                                   21                      23
     Changes in assets and liabilities:
       Accounts and notes receivable                                      1,533                     662
       Inventories                                                         (815)                   (817)
       Prepaid expenses and other                                           837                    (848)
       Other assets                                                        (636)                    213
       Customer deposits                                                    543                     686
       Accrued compensation                                              (1,956)                    694
       Payments against restructuring charges                              (347)                   (997)
       Accounts and notes payable, trade                                  1,064                   1,500
       Income taxes payable                                                (989)                    211
       Accrued and withheld taxes                                           (80)                   (287)
       Other accounts payable and accrued liabilities                      (495)                   (739)
       Interest payable                                                     (84)                     74
                                                                 --------------          --------------
           Net cash provided by operating activities                      1,206                   3,842
                                                                 --------------          --------------

Cash flows from investing activities:
   Additions of property, plant and equipment                              (312)                   (203)
   Additions of patents and trademarks                                     (317)                   (269)
                                                                 --------------          --------------
       Net cash (used) by investing activities                             (629)                   (472)
                                                                 --------------          --------------

Cash flows from financing activities:
   Long-term and short-term debt borrowings                                   -                  22,271
   Long-term and short-term debt repayments                                (535)                (18,874)
   Principal payments under capital lease obligations                       (61)                    (64)
   Payment of debt financing costs                                         (259)                 (2,457)
   Other long-term liabilities                                               78                      (9)
   Proceeds from stock option plan                                           48                       0
                                                                 --------------          --------------
           Net cash (used) provided by financing activities                (729)                    867
                                                                 --------------          --------------

Effects of exchange rate changes                                            811                   1,491
                                                                 --------------          --------------

Net increase in cash and cash equivalents                                   659                   5,728
Cash and cash equivalents at beginning of period                         12,008                   6,950
                                                                 --------------          --------------
Cash and cash equivalents at end of period                       $       12,667          $       12,678
                                                                 ==============          ==============


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

                                       5



                        BALDWIN TECHNOLOGY COMPANY, INC.

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)
                                   (UNAUDITED)

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:



                                           For the six months
                                           ended December 31,
                                         ----------------------
                                          2004           2003
                                         -------        -------
                                                  
Cash paid during the period for:
   Interest                              $ 1,607        $ 2,429
   Income taxes                          $ 2,029        $ 1,007


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

                                       6



                        BALDWIN TECHNOLOGY COMPANY, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

NOTE 1 - ORGANIZATION AND BASIS OF PRESENTATION:

      Baldwin Technology Company, Inc. and its subsidiaries ("Baldwin" or the
"Company") are engaged primarily in the development, manufacture and sale of
accessories and controls for the printing industry.

      The accompanying unaudited consolidated financial statements include the
accounts of Baldwin and its subsidiaries and have been prepared in accordance
with accounting principles generally accepted in the United States of America
for interim financial information and in compliance with the rules and
regulations of the Securities and Exchange Commission. These financial
statements reflect all adjustments, which are in the opinion of management,
necessary to present a fair statement of the results for the interim periods.
These financial statements should be read in conjunction with the consolidated
financial statements and related notes included in the Company's latest Annual
Report on Form 10-K for the fiscal year ended June 30, 2004.

NOTE 2 - RECENTLY ISSUED ACCOUNTING STANDARDS:

      In December 2004,the Financial Accounting Standards Board (FASB) published
Statement of Financial Accounting Standards (SFAS) No. 123 (revised 2004), (SFAS
123(R)) "Share Based Payment". SFAS 123(R) establishes standards for the
accounting for transactions in which an entity exchanges its equity instruments
for goods or services. The statement focuses primarily on accounting for
transactions in which an entity obtains employee services in shared-based
payment transactions. SFAS 123(R) eliminates the ability to account for
share-based compensation transactions using APB Opinion No. 25 (APB 25),
"Accounting for Stock Issued to Employees", and generally requires that such
transactions be accounted for using a fair-value-based method. The Company
currently accounts for its stock option plans under the recognition and
measurement principals of APB 25. As all previously issued stock option awards
granted under the plans had an exercise price equal to the market value of the
underlying common stock on the date of grant, no compensation costs related to
stock option grants are currently reflected in net income. SFAS 123(R) is
effective as of the first interim or annual reporting period that begins after
June 15, 2005, therefore, the effective date for the Company is July 1, 2005.
SFAS 123(R) applies to all awards granted after the required effective date and
to awards modified, repurchased, or cancelled after that date and as a
consequence future employee stock option grants and other stock based
compensation plans will be recorded as expense over the vesting period of the
award based on their fair values at the date the stock based compensation is
granted. The cumulative effect of initially applying SFAS 123(R) is to be
recognized as of the required effective date using a modified prospective
method. Under the modified prospective method the Company will recognize
stock-based compensation expense from July 1, 2005 as if the fair value based
accounting method had been used to account for all outstanding unvested employee
awards granted, modified or settled in prior years. The ultimate impact on
future years results of operation and financial position will depend upon the
level of stock based compensation granted in future years. The Company estimates
the additional compensation expense associated with its current outstanding
awards will be $165,000 after tax for fiscal year ending June 30, 2006.

      On October 22, 2004, the American Jobs Creation Act of 2004 (the Act) was
signed into law. Some of the key relief provisions of the new Act include a
temporary incentive for U.S. multinationals to repatriate foreign earnings, a
new domestic manufacturing deduction, and

                                       7



international tax reforms designed to improve the global competitiveness of U.S.
multinationals. Some of the key revenue-raising provisions of the Act include
repeal of a U.S. export tax incentive known as the "extraterritorial income
exclusion" (ETI), new tax shelter penalties, restrictions on deferred
compensation, and numerous other provisions aimed at specific transactions. The
Company is currently evaluating the impact of the new law.

      Additionally, the FASB issued SFAS No. 151 related to inventory costs and
SFAS No. 153 related to exchanges of non-monetary assets. Adoption of these
amendments to Accounting Research Bulletin No. 43 and Accounting Principles
Board Opinion No. 29 are not expected to have a material effect on the Company's
results of operations and financial position.

NOTE 3 - LONG TERM DEBT:

      On September 15, 2004, the Company amended its primary source of outside
financing, the revolving credit agreement (the "Maple Credit Agreement") with
Maple Bank GmbH ("Maple"). The amendment increased the size of the facility to
$28,000,000 from $20,000,000, extended the maturity date of the loan to October
2008, and reduced the interest rates and annual fees associated with the
Agreement. The credit facility is collateralized by substantially all of the
accounts and notes receivable of the Company and a portion of the Company's
inventory up to a maximum amount of $10,000,000. Borrowings under the credit
facility are subject to a borrowing base and bear interest at a rate equal to
the three-month Eurodollar rate (as defined in the Maple Credit Agreement) plus
(i) 5.125% for loans denominated in U.S. Dollars or (ii) 5.525% for loans
denominated in Euros. The interest rate will be reduced by 0.50% or whole
increments thereof for each whole increment of Disclosed EBITDA (as defined in
the Credit Agreement) that equals or exceeds $1,250,000 for any fiscal quarter.
In no event however, may the interest rate be less than 7.625% for EURO based
borrowings and 7.5% for dollar-based borrowings. Additionally, the amendment
granted to the lender an option to acquire a maximum of $5,000,000 of equity
securities (as defined in the amendment) should the Company choose to issue any
such securities. The amended credit agreement does not require the Company to
meet any financial covenants, except for the limitation on annual capital
expenditures; however, it contains a material adverse effect clause, which
provides that Maple would not be obligated to fund any loan, convert or continue
any loan as a LIBOR loan or issue any new letters of credit in the event of a
material adverse effect. Management does not anticipate that such an event will
occur; however, there can be no assurance that such an event will not occur.

                                       8




                                                         JUNE 30, 2004               DECEMBER 31, 2004
                                                  --------------------------    --------------------------
                                                   CURRENT       LONG-TERM       CURRENT       LONG-TERM
                                                  -----------    -----------    -----------    -----------
                                                                                   
Revolving Credit Facility due October 1, 2008,
  interest rate 5.525% plus three-month
  Eurodollar rate (2.153% at December 31)         $       ---    $       ---    $       ---    $21,579,000
Revolving Credit Facility due August 15,
  2005, interest rate 10.00% plus three-
  month Eurodollar rate ......................     18,497,000            ---            ---            ---
Revolving Credit Facility due August 15,
  2005, interest rate 11.50% plus three-
  month Eurodollar rate ......................        970,000            ---            ---            ---
Term Loan payable by foreign subsidiary
  due December 8, 2006, interest rate 1.5% ...        919,000      1,379,000        976,000        977,000
Note payable by foreign subsidiary
  through 2008, interest rate 5.95% ..........        120,000        389,000        136,000        372,000
Notes payable by foreign subsidiary
  through February 2007, interest rates
  ranging from 4.58% to 4.67% ................         17,000         26,000         19,000         19,000
                                                  -----------    -----------    -----------    -----------
                                                  $20,523,000    $ 1,794,000    $ 1,131,000    $22,947,000
                                                  ===========    ===========    ===========    ===========


      The Company maintains relationships with both foreign and domestic banks,
which combined have extended short and long term credit facilities to the
Company totaling $34,404,000, including $28,000,000 available under the Maple
Credit Agreement. As of December 31, 2004, the Company had $27,934,000
outstanding under these credit facilities with $22,506,000 (including letters of
credit) outstanding under the Maple Credit Agreement.

NOTE 4 - NET INCOME (LOSS) PER SHARE:

      Basic net income per share includes no dilution and is computed by
dividing net income available to common stockholders by the weighted average
number of common shares outstanding for the period. Diluted net income per share
reflects the potential dilution of securities that could share in the earnings
of an entity. The weighted average shares outstanding used to compute diluted
net income per share include 418,000 and 448,000 additional shares, respectively
for the three and six months ended December 31, 2004 and 115,000 and 230,000
additional shares, respectively, for the three and six months ended December 31,
2003, which represent potentially dilutive securities. Outstanding options to
purchase 687,000 and 931,000 shares of the Company's common stock for the six
months ended December 31, 2004 and 2003 respectively, are not included in the
above calculation to compute diluted net income per share as they have an
anti-dilutive effect.

NOTE 5 - OTHER COMPREHENSIVE INCOME (LOSS):

      Accumulated Other Comprehensive Income (Loss) ("AOCI") is comprised of
various items, which affect equity that result from recognized transactions and
other economic events other than transactions with owners in their capacity as
owners. AOCI is included in stockholders' equity in the consolidated balance
sheets. AOCI consists of the following:



                                         December 31, 2004    June 30, 2004
                                         -----------------    -------------
                                                        
Cumulative translation adjustments       $       4,084,000    $   2,725,000
Unrealized gain on investments,
 net of deferred taxes of $2,000
 ($22,000 at June 30, 2004)                          3,000           31,000
Unrealized gain (loss) on forward
 Contracts, net of tax                             (23,000)          (5,000)
Minimum pension liability, net of tax             (100,000)        (100,000)
                                         -----------------    -------------
                                         $       3,964,000    $   2,651,000
                                         =================    =============


NOTE 6 - INVENTORIES:

                                       9



      Inventories consist of the following:


                December 31, 2004  June 30, 2004
                -----------------  -------------
                             
Raw materials   $      13,342,000  $  12,309,000
In process              4,950,000      4,130,000
Finished goods          9,486,000      8,559,000
                -----------------  -------------
                $      27,778,000  $  24,998,000
                =================  =============


      Foreign currency translation effects increased inventories by $1,965,000
from June 30, 2004 to December 31, 2004.

NOTE 7 - DERIVATIVES:

      During the six months ended December 31, 2004 and 2003, the Company had
currency futures contracts that qualified as cash flow hedges. The gain or loss
on these cash flow hedges was recorded in AOCI and will be recognized when the
hedged items affect earnings.

      Unrealized net gains (losses) included in AOCI are as follows:



                                        December 31, 2004    December 31, 2003
                                        -----------------    -----------------
                                                       
Balance at beginning of period              $   (5,000)          $  (4,000)
Additional gains (losses), net                 (13,000)            (49,000)
Amounts reclassified to earnings, net           (5,000)             23,000
                                            ----------           ---------
Balance at end of period                    $  (23,000)          $ (30,000)
                                            ==========           =========


      Additionally, during the quarter and six months ended December 31, 2003,
the effects of an interest rate swap, then in effect, to convert variable rate
debt into fixed rate debt, increased interest expense $48,000 and $196,000,
respectively and the adjustment to fair value of the ineffective portion of the
swap resulting in a gain for the three and six months ended December 31, 2003 of
$48,000 and $196,000, respectively was recorded in other income and expense. The
swap matured in October 2003.

      The unrealized net loss of $23,000 at December 31, 2004 is comprised of
net losses on currency futures contracts, which expired at various times through
January 28, 2004, and were reclassified to earnings during that period.

NOTE 8 -- GOODWILL AND OTHER INTANGIBLE ASSETS:

      The changes in the carrying amount of goodwill for the six months ended
December 31, 2004 are as follows:



                                             Accessories and Controls
                                             ------------------------
                                   Gross Carrying    Accumulated         Net
                                       Amount        Amortization     Book Value
                                   --------------   -------------    ------------
                                                            
Balance as of July 1, 2004         $   14,620,000   $  (3,516,000)    $11,104,000
Effects of currency translation         1,103,000        (244,000)        859,000
                                   --------------   -------------     -----------
Balance as of December 31, 2004    $   15,723,000   $  (3,760,000)    $11,963,000
                                   ==============   =============     ===========


Intangible assets subject to amortization are comprised of the following:

                                       10





                           As of December 31, 2004      As of June 30, 2004
                          -------------------------  -------------------------
                             Gross                     Gross
                           Carrying    Accumulated    Carrying     Accumulated
Intangible Assets:          Amount     Amortization    Amount     Amortization
------------------        ----------   ------------  ----------   --------------
                                                      
Patents and trademarks    $6,867,000    $4,443,000   $6,483,000    $4,224,000
Other                      1,024,000       786,000      923,000       668,000
                          ----------    ----------   ----------    ----------
Total                     $7,891,000    $5,229,000   $7,406,000    $4,892,000
                          ==========    ==========   ==========    ==========


      Amortization expense associated with these intangible assets was $207,000
and $368,000, respectively, for the three and six months ended December 31, 2004
and $110,000 and $274,000, respectively for the three and six months ended
December 31, 2003. The other category is included in "Other assets" on the
accompanying consolidated balance sheets.

NOTE 9 -- RESTRUCTURING CHARGES AND RELATED RESERVES:

      The following table details the components of the restructuring charges
and the remaining reserve balances as of December 31, 2004 and June 30, 2004
related to the March 2000 Plan.

      Activity related to the March 2000 Plan in the six months ended December
31, 2004 was as follows:



                                                        Payments                              Remaining
                                    Remaining Reserve   Against           Reserve              Reserve
                                    June 30, 2004       Reserve      Recharacterization   December 31, 2004
                                    -----------------   ---------    ------------------   -----------------
                                                                              
Facility lease termination costs..      $ 792,000       $(235,000)       $(557,000)           $       0
                                        ---------       ---------        ---------            ---------
Total program ....................      $ 792,000       $(235,000)       $(557,000)           $       0
                                        =========       =========        =========            =========


      The recharacterization of facility lease termination costs relates to the
assumption of the pre-existing lease obligation by the lessor of the Company's
new office space. The value of this incentive has been recharacterized as a
deferred credit and will be amortized on a straight line basis over the life of
the new lease.

      The following table details the components of the restructuring charges
and the remaining reserve balances as of December 31, 2004 and June 30, 2004
related to the August 2002 Plan.

      Activity related to the August 2002 Plan in the six months ended December
31, 2004 was as follows:



                                      Remaining      Payments         Remaining
                                      Reserve         Against          Reserve
                                    June 30, 2004     Reserve      December 31, 2004
                                    -------------    ---------     -----------------
                                                          
Severance ........................  $     151,000    $ (42,000)       $  109,000
Facility lease termination costs..        158,000      (43,000)          115,000
Other costs ......................         32,000      (27,000)            5,000
                                    -------------    ---------        ----------    
Total program ....................  $     341,000    $(112,000)       $  229,000
                                    =============    =========        ==========    


      Severance and lease termination costs will be paid through October 2006.

NOTE 10 - PENSION AND OTHER POST-RETIREMENT BENEFITS:

The following table sets forth the components of net periodic benefit costs for
the Company's defined benefit plans for the three months ended December 31, 2004
and 2003:



                                            Pension Benefits            Pension Benefits
                                            ----------------            ----------------
                                          For the three months         For the six months
                                           ended December 31,           ended December 31,
                                          -------------------          ------------------
                                           2004          2003          2004          2003
                                         ---------     ---------     ---------     ----------
                                                                       
Service cost                             $  67,000     $  57,000     $ 134,000     $  123,000
Interest cost                               15,000        16,000        30,000         31,000
Expected return on plan assets              (1,000)       (1,000)       (2,000)        (2,000)
Amortization of transition obligation        3,000         4,000         6,000          7,000
Amortization of net actuarial gain               -        (6,000)            -        (14,000)
                                         ---------     ---------     ---------     ----------
Net periodic benefit cost                $  84,000     $  70,000     $ 168,000     $  145,000
                                         =========     =========     =========     ==========


                                       11



      During the six months ended December 31, 2004 and 2003 the Company made
contributions to the plans of $173,000 and $144,000, respectively.

NOTE 11 - BUSINESS SEGMENT INFORMATION:

      Operating segments are defined as material components of an enterprise
about which separate information is available that is evaluated regularly by the
chief operating decision maker, or decision-making group, in deciding how to
allocate resources and assess performance.

      The accounting policies of the operating segments are the same as those
described in the summary of significant accounting policies in the Company's
Annual Report on Form 10-K for the fiscal year ended June 30, 2004. An operating
segment's financial performance is primarily evaluated based on operating
profit.

      The tables below present information about reported segments for the three
and six months ended December 31, 2004 and 2003 (in thousands).



                             Three months ended     Six months ended
                                December 31,           December 31,
                                -----------            ------------
                                (Unaudited)            (Unaudited)
                                -----------            ------------
                              2004       2003       2004       2003
                             -------    -------    -------    -------
                                                  
Net Sales:
 Accessories and Controls    $41,232    $39,443    $81,229    $73,954
                             -------    -------    -------    -------
    Total Net Sales          $41,232    $39,443    $81,229    $73,954
                             =======    =======    =======    =======


      Foreign currency translation effects increased net sales by $2,091,000 and
$4,684,000, respectively for the three and six months ended December 31, 2004.

                                       12





                                      Three months ended       Six months ended
                                         December 31,             December 31,
                                         ------------             ------------
                                         (Unaudited)              (Unaudited)
                                         -----------              -----------
                                       2004        2003        2004        2003
                                     --------     -------     -------     -------
                                                              
Operating income:
  Accessories and Controls            $ 3,105     $ 3,601     $ 6,405     $ 6,105
  Corporate                            (1,844)     (2,137)     (3,744)     (3,811)
                                      -------     -------     -------     -------
   Total operating income               1,261       1,464       2,661       2,294
Interest expense, net                    (541)     (1,388)     (1,470)     (2,299)
Royalty income, net                       763         900       1,517       1,551
Other income (expense), net              (137)      1,038        (124)      1,630
                                      -------     -------     -------     -------
  Income from continuing
   operations before income taxes     $ 1,346     $ 2,014     $ 2,584     $ 3,176
                                      =======     =======     =======     =======


      Included in operating income are restructuring charges of $43,000 and
$425,000, respectively for the three and six months ended December 31, 2003.




                                 December 31,   June 30,
                                    2004          2004
                                 ------------   --------
                                          
                                       (Unaudited)
Identifiable assets:
  Accessories and Controls       $    106,536   $100,956
  Corporate                            14,889     14,315
                                 ------------   --------
    Total identifiable assets    $    121,425   $115,271
                                 ============   ========


NOTE 12 - STOCK OPTIONS:

      On January 1, 2003, the Company adopted the disclosure provisions of
Financial Accounting Standards Board ("FASB") Statement No. 148, "Accounting for
Stock-Based Compensation - transition and disclosure" ("SFAS 148"), which
amended FASB Statement No. 123, "Accounting for Stock-Based Compensation" ("SFAS
123") to provide alternative methods of transition for an entity that
voluntarily changes to the fair value based method of accounting for stock-based
employee compensation, effective as of the beginning of the fiscal year. Baldwin
continues to apply the provisions of Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees," ("APB 25") in accounting for
stock-based compensation. In accordance with APB No. 25, compensation costs for
stock options is recognized in income based on the excess, if any, of the quoted
market price over the exercise price of the stock on the date of grant. The
exercise price for all stock option awards previously granted equaled the fair
market value of the underlying Common Stock on the date of grant, therefore no
compensation expense is recorded.

      The pro forma net income and income per share information have been
determined for employee stock plans under the fair value method using the
Black-Scholes option-pricing model at the date of grant. The following table
illustrates the effect on net income (loss) and income (loss) per share if the
Company had applied the fair value recognition provisions of SFAS 123 for the
three and six months ended December 31, 2004 and 2003 (in thousands):

                                       13





                                      Three months ended       Six months ended
                                          December 31,           December 31,
                                          ------------           ------------
                                          (Unaudited)            (Unaudited)
                                          -----------            -----------
                                       2004        2003         2004       2003
                                      -------     -------     --------    -------
                                                              
Net income, as reported               $   788     $ 1,224     $  1,507    $ 1,903

Deduct: Total stock-based employee
 compensation expense determined
 under fair value based method for
 all awards, net of related tax
 effects                                  (13)        (25)         (26)       (51)
                                      -------     -------     --------    -------
Pro forma net income                  $   775     $ 1,199     $  1,481    $ 1,852
                                      =======     =======     ========    =======

Income per share:
   Basic and diluted - as reported    $  0.05     $  0.08     $   0.10    $  0.13
                                      =======     =======     ========    =======
   Basic and diluted - pro forma      $  0.05     $  0.08     $   0.10    $  0.12
                                      =======     =======     ========    =======


      On August 17, 2004, the Compensation and Stock Option Committee and, for
options granted to the Chief Executive Officer, the Independent Directors, of
the Board of Directors of the Company granted non-qualified options to purchase
360,000 shares of Class A common stock to executives and key employees under the
Company's 1996 Stock Option Plan (the "1996 Plan") at an exercise price of $3.41
per share, the fair market value on the date of grant. On November 10, 2004,
under the 1996 Plan, six non-employee Directors were automatically granted
options to purchase 30,000 shared of Class A common stock at an exercise price
of $3.25 per share, the fair market value on the date of the grant.

NOTE 13 - CUSTOMERS:

      During the three and six months ended December 31, 2004, one customer
accounted for more than 10% of the Company's net sales. Koenig and Bauer
Aktiengesellschaft ("KBA") accounted for approximately 18% of the Company's net
sales for each of the three and six months ended December 31, 2004 and
approximately 16% of the Company's net sales for each of the three and six
months ended December 31, 2003.

NOTE 14 - WARRANTY COSTS:

      The Company's standard contractual warranty provisions are to repair or
replace, at the Company's option, product that is proven to be defective. The
Company estimates its warranty costs as a percentage of revenues on a product by
product basis, based on actual historical experience within the Company. Hence,
the Company accrues estimated warranty costs at the time of sale. In addition,
should the Company become aware of a specific potential warranty claim, a
specific charge is recorded and accounted for separate from the percent of
revenue discussed above.



                                                        Warranty Amount
                                                  ---------------------------
                                                     2004            2003
                                                  -----------     -----------
                                                            
Warranty reserve at June 30, 2004 and 2003        $ 2,714,000     $ 1,665,000
Additional warranty expense accruals                2,171,000       1,990,000
Payments against reserve                           (2,128,000)     (1,807,000)
Effects of currency rate fluctuations                 303,000         172,000
                                                  -----------     -----------
Warranty reserve at December 31, 2004 and 2003    $ 3,060,000     $ 2,020,000
                                                  ===========     ===========


NOTE 15 - LEGAL PROCEEDINGS AND SETTLEMENTS:

                                       14



      On November 14, 2002, the Dusseldorf Higher Regional Court ("DHRC")
announced its judgment in favor of Baldwin in a patent infringement dispute
against its competitor, technotrans AG ("Technotrans"). Subsequent to November
14, 2002, Technotrans filed an appeal of the DHRC ruling with the German Supreme
Court in Karlsruhe. That court has not yet reached a decision on the appeal.
Technotrans also filed to revoke the Company's patent with the Federal Patent
Court in Munich, Germany. On July 21, 2004, the German Federal Patent Court
upheld the validity of the Company's patent. Technotrans has appealed that
judgment. No amounts have been recorded in the consolidated financial statements
with regard to the potential contingent gain resulting from the DHRC judgment;
however, the Company is considering a claim for damages based on the favorable
rulings in both the patent infringement case and the patent validity
confirmation.

                                       15



                        BALDWIN TECHNOLOGY COMPANY, INC.

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

      The following is management's discussion and analysis of certain factors,
which have affected the consolidated financial statements of Baldwin Technology
Company, Inc. ("Baldwin" or the "Company").

FORWARD-LOOKING STATEMENTS

      Except for the historical information contained herein, the following
statements and certain other statements contained herein are based on current
expectations. Such statements are forward-looking statements that involve a
number of risks and uncertainties. The Company cautions investors that any such
forward-looking statements made by the Company are not guarantees of future
performance and that actual results may differ materially from those in the
forward-looking statements. Some of the factors that could cause actual results
to differ materially include, but are not limited to the following: (i) the
ability to obtain, maintain and defend challenges against valid patent
protection on certain technology, primarily as it relates to the Company's
cleaning systems, (ii) material changes in foreign currency exchange rates
versus the U.S. Dollar, (iii) changes in the mix of products and services
comprising revenues, (iv) a decline in the rate of growth of the installed base
of printing press units and the timing of new press orders, (v) general economic
conditions, either domestically or in foreign locations, (vi) the ultimate
realization of certain trade receivables and the status of ongoing business
levels with the Company's large OEM customers, (vii) competitive market
influences and (viii) the ability to successfully implement the Company's
restructuring initiatives. Additional factors are set forth in Exhibit 99 to the
Company's Annual Report on Form 10-K for the fiscal year ended June 30, 2004
which should be read in conjunction herewith.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

      For further information regarding the Company's critical accounting
policies, please refer to the Management's Discussion and Analysis section of
the Company's Annual Report on Form 10-K for the fiscal year ended June 30,
2004.

SIX MONTHS ENDED DECEMBER 31, 2004 VS. SIX MONTHS ENDED DECEMBER 31, 2003

CONSOLIDATED RESULTS

      Net sales for the six months ended December 31, 2004 increased by
$7,275,000, or 10%, to $81,229,000 from $73,954,000 for the six months ended
December 31, 2003. Currency rate fluctuations attributable to the Company's
overseas operations increased net sales by $4,684,000 in the current period,
otherwise, net sales would have increased by $2,591,000.

      The net sales increase reflects increased sales in Europe, $1,835,000 in
the commercial systems market, particularly in Germany, and in spray dampening
and water systems markets serviced by Sweden. Increased penetration into
selected OEMs and improving market conditions led to the improved revenue. In
Asia, particularly Japan, net sales increased $819,000 due to higher sheeter and
water systems sales into the commercial market. In the Americas, particularly
the U.S. sales were relatively flat.

                                       16



      Gross profit for the six months ended December 31, 2004 was $24,798,000
(30.5% of net sales) as compared to $23,566,000 (31.9% of net sales) for the six
months ended December 31, 2003, an increase of $1,232,000 or 5.0%. Currency rate
fluctuations increased gross profit by $1,547,000 in the current period.
Excluding the effects of currency rate fluctuation, gross profit would have
decreased by $316,000. Gross profit as a percentage of net sales decreased
primarily due to an unfavorable mix of products, and higher material cost,
particularly in Japan coupled with higher material costs for imported products
into the United States as a result of the weak U.S. dollar and unfavorable
absorption in the U.S. Partially offsetting these declines were volume
improvements particularly in Germany.

      Selling, general and administrative expenses amounted to $14,915,000
(18.4% of net sales) for the six months ended December 31, 2004 as compared to
$14,289,000 (19.3% of net sales) for the same period in the prior fiscal year,
an increase of $626,000 or 4.3%. Currency rate fluctuations increased these
expenses by $712,000 in the current period. Otherwise, selling, general and
administrative expenses would have remained flat. Selling expenses increased by
$575,000, which primarily relates to increased compensation and travel
associated costs in Europe coupled with higher test installation costs at
perspective customer sites, in response to improving market activities. General
and administrative expenses decreased by $657,000 primarily due to lower
incentive compensation accruals.

      Engineering and development expenses increased by $663,000 over the same
period in the prior fiscal year. Currency rate fluctuations increased these
expenses by $453,000 in the current period. Excluding the effects of currency
rate fluctuations, engineering and development expenses would have increased by
$209,000 in the current period. This increase relates primarily to increased
product management employee related costs. As a percentage of net sales,
engineering and development expenses remained at 8.9% for the six months ended
December 31, 2004 and 2003.

      The Company recorded restructuring charges of $0 for the six months ended
December 31, 2004 compared to $425,000 for the same period in the prior fiscal
year. The restructuring charge in the prior fiscal year primarily represented
additional employment reductions in the United States and the United Kingdom
announced in August 2003 associated with restructuring activities initiated in
August 2002 ( the "August 2002 Plan").

      Interest expense for the six months ended December 31, 2004 was $1,523,000
as compared to $2,355,000 for the six months ended December 31, 2003. Currency
rate fluctuations increased interest expense by $140,000 in the current period.
Otherwise, interest expense would have decreased by $972,000. This decrease was
primarily due to lower interest rates in effect during the six months ended
December 31, 2004 as a result of the new credit agreement with Maple Bank GmbH
("Maple"), which was entered into on September 15, 2004 and lower deferred debt
financing cost amortization during the period associated with Maple.
Additionally, interest expense, for the six month period ended December 31, 2003
included $196,000 associated with an interest rate swap, which expired on
October 30, 2003. Interest income amounted to $53,000 and $56,000 for the six
months ended December 31, 2004 and 2003, respectively. Currency rate
fluctuations decreased interest income by $22,000 in the current period.

      Net royalty income for the six months ended December 31, 2004 was
$1,517,000 as compared to $1,551,000 for the six months ended December 31, 2003.

      Other income (expense), net amounted to expense of $124,000 for the six
months ended December 31, 2004 compared to income of $1,630,000 for the six
months ended December 31, 2003. Other income (expense), net includes net foreign
currency transaction (losses) of $107,000 and gains of $1,610,000 for the six
months ended December 31, 2004 and 2003,

                                       17



respectively. The decrease is primarily attributable to currency fluctuations
associated with the Maple loan. During fiscal year 2004 the loan was a dollar
based loan recorded on the books of the Company's Netherlands subsidiary and
subject to foreign currency fluctuations. During the quarter ended September 30,
2004 the loan was converted from a dollar based loan to a euro based loan.
Additionally, included in other income and expense for the six months ended
December 31, 2003 is income related to an interest rate swap which ceased to
qualify as a hedge of $197,000 and expense of $291,000 related to the write off
of deferred alternative financing costs.

      The Company recorded an income tax provision of $1,077,000 for the six
months ended December 31, 2004 as compared to $1,273,000 for the six months
ended December 31, 2003. The effective tax rate of 41.7% for the six months
ended December 31, 2004 is primarily due to greater taxable income in higher tax
jurisdictions and in which tax loss carryforwards are not available. The
effective tax rate for the six months ended December 31, 2004 differs from the
statutory rate as no benefit was recognized for losses incurred in certain
countries as the realization of such benefits was not more likely than not.

      The Company's net income amounted to $1,507,000 for the six months ended
December 31, 2004, compared to a net income of $1,903,000 for the six months
ended December 31, 2003. Currency rate fluctuations increased net income by
$113,000 in the current period. Net income per share amounted to $0.10 basic and
diluted for the six months ended December 31, 2004, as compared to net loss per
share of $0.13 basic and diluted for the six months ended December 31, 2003.

SEGMENT RESULTS

ACCESSORIES AND CONTROLS GROUP

      Net sales for the six months ended December 31, 2004 increased by
$7,275,000, or 10%, to $81,229,000 from $73,954,000 for the six months ended
December 31, 2003. Currency rate fluctuations attributable to the Company's
overseas operations increased net sales for the current period by $4,684,000;
otherwise, net sales would have increased by $2,591,000 in the current period.

      Operating income amounted to $6,405,000 (7.9% of net sales) for the six
months ended December 31, 2004, as compared to an operating income of $6,105,000
(8.3% of net sales) for the same period in the prior fiscal year, an increase of
$300,000. Excluding currency rate fluctuations operating income would have
remained flat in the current period.

THREE MONTHS ENDED DECEMBER 31, 2004 VS. THREE MONTHS ENDED DECEMBER 31, 2003

CONSOLIDATED RESULTS

      Net sales for the three months ended December 31, 2004 increased by
$1,789,000, or 4.5%, to $41,232,000 from $39,443,000 for the three months ended
December 31, 2003. Currency rate fluctuations attributable to the Company's
overseas operations increased net sales by $2,090,000 in the current period,
otherwise, net sales would have decreased by $302,000.

The net sales decrease relates primarily to lower newspaper cleaning system
sales in Europe and commercial cleaning systems sales in the United States.
Partially offsetting these declines were higher commercial cleaning and water
systems shipments in Asia, particularly Japan.

                                       18


      Gross profit for the three months ended December 31, 2004 was $12,707,000
(30.8% of net sales) as compared to $12,797,000 (32.4% of net sales) for the
three months ended December 31, 2003, a decrease of $90,000. Currency rate
fluctuations increased gross profit by $723,000 in the current period. Excluding
the effects of currency rate fluctuation, gross profit would have decreased by
$813,000. Unfavorable sales mix in Sweden and Japan, coupled with higher
material costs for imported products and unfavorable absorption in the United
States primarily account for the decline. Partially offsetting these declines
were volume improvements in Germany.

      Selling, general and administrative expenses amounted to $7,582,000 (18.3%
of net sales) for the three months ended December 31, 2004 as compared to
$7,975,000 (20.2% of net sales) for the same period in the prior fiscal year, a
decrease of $393,000 or 4.9%. Currency rate fluctuations increased these
expenses by $340,000 in the current period. Otherwise, selling, general and
administrative expenses would have decreased by $733,000. Selling expenses
increased by $112,000, which primarily relates to increased compensation, travel
costs and office operations. General and administrative expenses decreased by
$845,000 primarily due to lower incentive compensation accruals.

      Engineering and development expenses increased by $549,000 over the same
period in the prior fiscal year. Currency rate fluctuations increased these
expenses by $236,000 in the current period. Excluding the effects of currency
rate fluctuations, engineering and development expenses would have increased by
$313,000 in the current period. This increase relates primarily to and travel
related costs, outside subcontractor costs and office operation costs. As a
percentage of net sales, engineering and development expenses increased to 9.4%
for the three months ended December 31, 2004 compared to 8.4% for the same
period in the prior fiscal year.

         The Company recorded restructuring charges of $0 for the three months
ended December 31, 2004 compared to $43,000 for the same period in the prior
fiscal year. These restructuring charges represent additional costs associated
with both the March 2000 Plan and August 2002 Plan, which were expensed as
incurred.

         Interest expense for the three months ended December 31, 2004 was
$571,000 as compared to $1,418,000 for the three months ended December 31, 2003.
Currency rate fluctuations increased interest expense by $55,000 in the current
period. Otherwise, interest expense would have decreased by $902,000. This
decrease was primarily due to lower interest rates in effect for the three
months ended December 31, 2004 as a result of the new credit agreement with
Maple Bank GmbH ("Maple"), which was entered into on September 15, 2004 and
lower deferred debt financing cost amortization during the period associated
with Maple. Additionally, interest expense for the three months ended December
31,2003 included expense of $48,000 associated with an interest rate swap which
expired on October 30, 2003. Interest income amounted to $30,000 for the three
months ended December 31, 2004 and 2003.

      Net royalty income for the three months ended December 31, 2004 was
$763,000 as compared to $900,000 for the three months ended December 31, 2003.
The decrease in royalty income in the current period is primarily due to a
decline in the number of units sold by the Company's licensees.

      Other income (expense), net amounted to expense of $137,000 for the three
months ended December 31, 2004 compared to income of $1,038,000 for the three
months ended December 31, 2003. Other income (expense), net includes net foreign
currency transaction losses of $119,000 and gains of $1,092,000 for the three
months ended December 31, 2004 and 2003, respectively. The decrease is primarily
attributable to currency fluctuations associated with the Maple loan. During
fiscal year 2004 the loan was a dollar-based loan recorded on the books of the
Company's Netherlands subsidiary and subject to foreign currency

                                       19


fluctuations. During the quarter ended September 30, 2004 the loan was converted
from a dollar based loan to a euro based loan. Additionally included in other
income and expense for the three months ended December 31, 2003 were gains of
$48,000 related to an interest rate swap which ceased to qualify as a hedge and
expense of $106,000 related to the write off of deferred alternative financing
costs.

      The Company recorded an income tax provision of $558,000 for the three
months ended December 31, 2004 as compared to $790,000 for the three months
ended December 31, 2003. The effective tax rate of 41.5% for the three months
ended December 31, 2004 is primarily due to greater taxable income in higher tax
jurisdictions and in which tax loss carryforwards are not available. The
effective tax rate for the three months ended December 31, 2004 differs from the
statutory rate as no benefit was recognized for losses incurred in certain
countries as the realization of such benefits was not more likely than not.

      The Company's net income amounted to $788,000 for the three months ended
December 31, 2004, compared to $1,224,000 for the three months ended December
31, 2003. Net income per share amounted to $0.05 basic and diluted for the three
months ended December 31, 2004, as compared to $0.08 basic and diluted for the
three months ended December 31, 2003.

SEGMENT RESULTS

ACCESSORIES AND CONTROLS GROUP

      Net sales for the three months ended December 31, 2004 increased by
$1,789,000, or 4.5%, to $41,232,000 from $39,443,000 for the three months ended
December 31, 2003. Currency rate fluctuations attributable to the Company's
overseas operations increased net sales for the current period by $2,090,000;
otherwise, net sales would have remained essentially flat in the current period.

      Operating income amounted to $3,105,000 (7.5% of net sales) for the three
months ended December 31, 2004, as compared to $3,601,000 (9.17% of net sales)
for the same period in the prior fiscal year, a decrease of $496,000. Currency
rate fluctuations increased the current fiscal year's operating income by
$158,000. Otherwise, operating income would have decreased by $654,000 in the
current period. This decrease is primarily the result of the effects of the
lower gross margins noted above coupled with the aforementioned higher selling
and engineering expenses.

                                       20


              LIQUIDITY AND CAPITAL RESOURCES AT DECEMBER 31, 2004

      Cash flows from operating, investing and financing activities, as
reflected in the six months ended December 31 in the Consolidated Statement of
Cash Flows, are summarized as follows:



                                               2004           2003
                                            -----------    -----------
                                                     
Cash provided by (used for):
Operating activities                        $ 1,206,000    $ 3,842,000
Investing activities                           (629,000)      (472,000)
Financing activities                           (729,000)       867,000
Effect of exchange rate changes on cash         811,000      1,491,000
                                            -----------    -----------
Net increase in cash and cash equivalents   $   659,000    $ 5,728,000
                                            ===========    ===========


      Cash provided by operating activities decreased $2,636,000 during the six
months ended December 31, 2004 versus the prior year period. Management
incentive compensation plan payments, commensurate with fiscal year 2004
results, of $1,800,000, and higher income tax payments of $1,022,000,
particularly in Japan and Germany, coupled with a build up in inventory in
anticipation of second half shipments primarily account for the change.

      The Company utilized $629,000 and $472,000 for investing activities for
the six months ended December 31, 2004 and 2003 respectively, for additions to
property, plant and equipment and patents and trademarks.

      On September 15, 2004, the Company amended its primary source of outside
financing, the revolving credit agreement (the "Maple Credit Agreement") with
Maple Bank GmbH ("Maple"). The amendment increased the size of the facility to
$28,000,000 from $20,000,000, extended the maturity date of the loan to October
2008, and reduced the interest rates and annual fees associated with the Maple
Credit Agreement. The credit facility is collateralized by substantially all of
the accounts and notes receivable of the Company and a portion of the Company's
inventory up to a maximum amount of $10,000,000. Borrowings under the credit
facility are subject to a borrowing base and bear interest at a rate equal to
the three-month Eurodollar rate (as defined in the Maple Credit Agreement) plus
(i) 5.125% for loans denominated in U.S. Dollars or (ii) 5.525% for loans
denominated in Euros. The interest rate will be reduced by 0.50% or whole
increments thereof for each whole increment of Disclosed EBITDA (as defined in
the Maple Credit Agreement) that equals or exceeds $1,250,000 for any fiscal
quarter. In no event however, may the interest rate be less than 7.625% for EURO
based borrowings and 7.5% for dollar-based borrowings. Additionally, the Maple
Credit Agreement granted to Maple an option to acquire a maximum of $5,000,000
of equity securities (as defined in the Maple Credit Amendment) should the
Company choose to issue any such securities. The Maple Credit Agreement does not
require the Company to meet any financial covenants, except for the limitation
on annual capital expenditures; however, it contains a material adverse effect
clause, which provides that Maple would not be obligated to fund any loan,
convert or continue any loan as a LIBOR loan or issue any new letters of credit
in the event of a material adverse effect. Management does not anticipate that
such an event will occur; however, there can be no assurance that such an event
will not occur. Management also expects that as a result of the aforementioned
amendment and full amortization of fiscal year 2004 debt financing costs that
reported interest expense for the full year ending June 30, 2005 will be
approximately $2,000,000 lower than for fiscal year ended June 30, 2004.

      The Company maintains relationships with both foreign and domestic banks,
which combined have extended credit facilities to the Company totaling
$34,404,000, including $28,000,000 available under the Maple Credit Agreement.
As of December 31, 2004, the Company had $27,934,000 outstanding under these
credit facilities with $22,506,000 (including letters of credit) under the Maple
Credit Agreement.

                                       21


      The Company believes that its cash flows from operations, along with the
available bank lines of credit and alternative sources of borrowings, if
necessary, are sufficient to finance its working capital and other capital
requirements through the term of the Maple Credit Agreement.

      At December 31, 2004 and June 30, 2004, the Company did not have any
relationships with unconsolidated entities or financial partnerships, such as
entities often referred to as structured finance entities, special purpose
entities or variable interest entities, which would have been established for
the purpose of facilitating off-balance sheet arrangements or other
contractually narrow or limited purposes. As such, the Company is not exposed to
any financing, liquidity, market or credit risk that could arise if the Company
had engaged in such relationships.

      The following summarizes the Company's contractual obligations at December
31, 2004 and the effect such obligations are expected to have on its liquidity
and cash flow in future periods (in thousands):



                                                                        Fiscal Years ending June 30,
                                             Total at                                                             2010
                                             December                                                             and
                                             30, 2004     2005*      2006       2007       2008       2009     thereafter
                                             --------   --------   --------   --------   --------   --------   ----------
                                                                                          
Contractual Obligations:
Loans payable                                $  2,929   $    976   $  1,953   $      -   $      -   $      -   $        -
Capital lease obligations                         223         57         92         39         21         14            -
Long-term debt                                 24,078        583      1,123        624        135     21,613            -
Non-cancelable operating lease obligations     13,316      2,235      3,914      2,549      1,621      1,222        1,775
                                             --------   --------   --------   --------   --------   --------   ----------
Total contractual cash obligations           $ 40,546   $  3,851   $  7,082   $  3,212   $  1,777   $ 22,849   $    1,775
                                             ========   ========   ========   ========   ========   ========   ==========


*Includes only the last six months of the fiscal year ending June 30, 2005.

ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK:

      A discussion of market risk exposures is included in Part II Item 7A,
"Quantitative and Qualitative Disclosures About Market Risk" of the Company's
Annual Report on Form 10-K for the fiscal year ended June 30, 2004. There have
been no material changes during the six months ended December 31, 2004.

ITEM 4: CONTROLS AND PROCEDURES:

      The Company maintains disclosure controls and procedures designed to
ensure that the information required to be disclosed in the reports that the
Company files or submits under the Securities Exchange Act is recorded,
processed, summarized and reported within the time periods specified in the
Securities and Exchange Commission's rules and forms.

      The Company's management, with the participation of the Company's Chief
Executive Officer and Chief Financial Officer, evaluated the effectiveness of
these disclosure controls and procedures as of the end of our fiscal quarter
December 31,2004, the period covered by this report. Based on that evaluation,
the Company's Chief Executive Officer and Chief Financial Officer have concluded
that the Company's disclosure controls and procedures are effective to achieve
their stated purpose. However, there is no assurance that the Company's
disclosure controls and procedures will operate effectively under all
circumstances. No changes were made to the Company's internal control over
financial reporting during the fiscal quarter ended December 31, 2004, that have
materially affected, or are reasonably likely to materially effect, the
Company's internal control over financial reporting.

                                       22


      Section 404 of the Sarbanes-Oxley Act of 2002 (the "Act") will require the
Company to include an internal control report from management in its annual
report for the year ending June 30, 2006 and in subsequent annual reports
thereafter. The internal control report must include the following: (1) a
statement of management's responsibility for establishing and maintaining
adequate internal control over financial reporting, (2) a statement identifying
the framework used by management to conduct the required evaluation of the
effectiveness of the Company's internal control over financial reporting, (3)
management's assessment of the effectiveness of the Company's internal control
over financial reporting as of June 30, 2006, including a statement as to
whether or not internal control over financial reporting is effective, and (4) a
statement that the Company's independent registered public accounting firm have
issued an attestation report on management's assessment of internal control over
financial reporting.

Management acknowledges its responsibility for establishing and maintaining
internal controls over financial reporting and seeks to continually improve
those controls. In addition, in order to achieve compliance with Section 404 of
the Act within the required timeframe, the Company intends to initiate a process
to document and evaluate its internal controls over financial reporting during
the third quarter of the fiscal year ending June 30, 2005.

                           PART II: OTHER INFORMATION

ITEM 2. PURCHASES OF EQUITY SECURITIES BY ISSUER AND AFFILIATED PURCHASES

      There has been no activity under the Company's stock repurchase program
for the quarter ended December 31, 2004.

ITEM 6. EXHIBITS

(a) Exhibits


         
31.01       Certification of the Principal Executive Officer pursuant to
            Exchange Act Rule 13a-14(a)/15d-14(a), as adopted pursuant to
            Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).

31.02       Certification of the Principal Financial Officer pursuant to
            Exchange Act Rule 13a-14(a)/15d-14(a), as adopted pursuant to
            Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).

32.01       Certification pursuant to Section 906 of the Sarbanes-Oxley Act of
            2002, 18 U.S.C. Section 1350 (filed herewith).

32.02       Certification pursuant to Section 906 of the Sarbanes-Oxley Act of
            2002, 18 U.S.C. Section 1350 (filed herewith).


                                       23


                                   SIGNATURES

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

                                 BALDWIN TECHNOLOGY COMPANY, INC.

                                 BY /s/  Vijay C. Tharani
                                    ----------------------
                                    Vice President, Chief Financial
                                    Officer and Treasurer

Dated: February 14, 2005

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