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

                                    Form 10-Q

[Mark One]

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

                       For quarter ended December 31, 2005

                                       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)


            2 Trap Falls Road, Suite 402, Shelton, Connecticut 06484
               (Address of principal executive offices) (Zip Code)

        Registrant's telephone number, including area code: 203-402-1000

                                       N/A
      (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 Exchange 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 a large accelerated filer,
an accelerated filer, or a non-accelerated filer. See definition of "accelerated
filer" and "large accelerated filer" in Rule 12b-2 of the Exchange Act.

Large accelerated filer [ ]    Accelerated filer [ ]   Non-accelerated filer [X]

     Indicate by check mark whether the registrant is a shell company (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 27, 2006
        -----          -------------------------------
                    
Class A Common Stock
   $0.01 par value                13,017,647

Class B Common Stock
   $0.01 par value                 1,935,419




                        BALDWIN TECHNOLOGY COMPANY, INC.

                                      INDEX



                                                                         Page
                                                                        -----
                                                                     
Part I  Financial Information

        Item 1 Financial Statements

               Consolidated Balance Sheets at December 31, 2005
               (unaudited) and June 30, 2005                              1-2

               Consolidated Statements of Income for the three
               and six months ended December 31, 2005
               (unaudited) and 2004 (unaudited)                             3

               Consolidated Statements of Changes in Shareholders'
               Equity for the six months ended December 31, 2005
               (unaudited)                                                  4

               Consolidated Statements of Cash Flows for the six
               months ended December 31, 2005 (unaudited) and
               2004 (unaudited)                                           5-6

               Notes to Consolidated Financial Statements (unaudited)    7-12

        Item 2 Management's Discussion and Analysis of Financial
               Condition and Results of Operations                      13-19

        Item 3 Quantitative and Qualitative Disclosures About Market
               Risk                                                        19

        Item 4 Controls and Procedures                                     19

Part II Other Information

        Item 2 Unregistered Sales of Equity Securities and Use of
               Proceeds                                                    20

        Item 6 Exhibits                                                    20

Signatures                                                                 21




                        BALDWIN TECHNOLOGY COMPANY, INC.

                           CONSOLIDATED BALANCE SHEETS
                                 (IN THOUSANDS)
                                   (UNAUDITED)

                                     ASSETS



                                                              December   June 30,
                                                              31, 2005     2005
                                                              --------   --------
                                                                   
CURRENT ASSETS:
   Cash                                                       $ 16,949   $ 15,443
   Accounts receivable trade, net of allowance for doubtful
      accounts of $1,655 ($1,962 at June 30, 2005)              25,101     27,160
   Notes receivable, trade                                       9,539      8,090
   Inventories, net                                             21,878     22,755
   Deferred taxes                                                  369        416
   Prepaid expenses and other                                    3,287      3,132
                                                              --------   --------
      Total Current Assets                                      77,123     76,996
                                                              --------   --------
MARKETABLE SECURITIES:
   Cost $678 ($610 at June 30, 2005)                               899        678
                                                              --------   --------
PROPERTY, PLANT AND EQUIPMENT, at cost:
   Land and buildings                                              919        936
   Machinery and equipment                                       2,058      2,082
   Furniture and fixtures                                        3,767      3,796
   Capital leases                                                  382        391
                                                              --------   --------
                                                                 7,126      7,205
   Less: Accumulated depreciation and amortization              (3,925)    (3,790)
                                                              --------   --------
Net Property, Plant and Equipment                                3,201      3,415
                                                              --------   --------
PATENTS, TRADEMARKS AND ENGINEERING DRAWINGS, at cost,
   less accumulated amortization of $4,750
   ($4,559 at June 30, 2005)                                     2,647      2,561
GOODWILL, less accumulated amortization of $3,283
   ($3,456 at June 30, 2005)                                    10,458     10,922
DEFERRED TAXES                                                  10,398     10,623
OTHER ASSETS                                                     3,681      4,156
                                                              --------   --------
TOTAL ASSETS                                                  $108,407   $109,351
                                                              ========   ========


           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   June 30,
                                                                  31, 2005     2005
                                                                  --------   --------
                                                                       
CURRENT LIABILITIES:
   Loans payable                                                  $  2,544   $  2,705
   Current portion of long-term debt                                 1,251      1,033
   Accounts payable, trade                                          14,009     14,789
   Notes payable, trade                                              8,856      9,278
   Accrued salaries, commissions, bonus and
      profit-sharing                                                 5,668      7,641
   Customer deposits                                                 3,361      3,320
   Accrued and withheld taxes                                        1,883      2,041
   Income taxes payable                                              1,868      1,204
   Other accounts payable and accrued liabilities                    9,157      9,486
                                                                  --------   --------
      Total current liabilities                                     48,597     51,497
                                                                  --------   --------
LONG TERM LIABILITIES:
   Long-term debt                                                   11,940     12,223
   Other long-term liabilities                                       6,682      6,400
                                                                  --------   --------
      Total long-term liabilities                                   18,622     18,623
                                                                  --------   --------
      Total liabilities                                             67,219     70,120
                                                                  --------   --------
SHAREHOLDERS' EQUITY:
   Class A Common Stock, $.01 par, 45,000,000 shares
      authorized, 16,647,849 shares issued at December 31, 2005
      and 16,575,349 shares issued at June 30, 2005                    167        166
   Class B Common Stock, $.01 par, 4,500,000 shares
      authorized, 2,107,883 shares issued at December 31, 2005
      and 2,137,883 shares issued at June 30, 2005                      21         21
   Capital contributed in excess of par value                       57,283     57,065
   Accumulated Deficit                                              (5,056)    (7,632)
   Accumulated other comprehensive income                            1,494      2,332
   Less: Treasury stock, at cost:
      Class A - 3,630,202 shares at December 31, 2005
         and June 30, 2005
      Class B - 172,464 shares at December 31, 2005
         and June 30, 2005                                         (12,721)   (12,721)
                                                                  --------   --------
         Total shareholders' equity                                 41,188     39,231
                                                                  --------   --------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                        $108,407   $109,351
                                                                  ========   ========


           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,
                                           --------------------   ------------------
                                              2005      2004        2005      2004
                                            -------   -------     -------   -------
                                                                
Net Sales                                   $43,826   $41,232     $86,471   $81,229
Cost of goods sold                           29,040    28,525      57,629    56,431
                                            -------   -------     -------   -------
Gross Profit                                 14,786    12,707      28,842    24,798
                                            -------   -------     -------   -------
Operating Expenses:
   General and administrative                 4,951     3,959       9,639     7,950
   Selling                                    3,652     3,623       7,086     6,965
   Engineering and development                3,818     3,864       7,598     7,222
                                            -------   -------     -------   -------
                                             12,421    11,446      24,323    22,137
                                            -------   -------     -------   -------
Operating income                              2,365     1,261       4,519     2,661
                                            -------   -------     -------   -------
Other (income) expense:
   Interest expense                             249       571         547     1,523
   Interest income                              (33)      (30)        (61)      (53)
   Royalty income, net                           --      (763)       (200)   (1,517)
   Other (income) expense, net                   12       137          79       124
                                            -------   -------     -------   -------
                                                228       (85)        365        77
                                            -------   -------     -------   -------
   Income before income taxes                 2,137     1,346       4,154     2,584
Provision for income taxes                      754       558       1,578     1,077
                                            -------   -------     -------   -------
Net income                                  $ 1,383   $   788     $ 2,576   $ 1,507
                                            =======   =======     =======   =======
Net income per share - basic and diluted
   Income per share - basic                 $  0.09   $  0.05     $  0.17   $  0.10
   Income per share - diluted                  0.09      0.05        0.17      0.10
                                            -------   -------     -------   -------
Weighted average shares outstanding:
   Basic                                     14,953    14,901      14,983    14,887
                                            =======   =======     =======   =======
   Diluted                                   15,666    15,319      15,570    15,335
                                            =======   =======     =======   =======


           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 A            Class B         Capital               Accumulated
                      Common Stock        Common Stock    Contributed                Other         Treasury Stock
                   ------------------  -----------------   In Excess   Retained  Comprehensive  --------------------  Comprehensive
                     Shares    Amount    Shares   Amount     of Par     Deficit      Income       Shares     Amount       Income
                   ----------  ------  ---------  ------  -----------  --------  -------------  ----------  --------  -------------
                                                                                        
Balance at
   June 30, 2005   16,575,349   $166   2,137,883    $21     $57,065    $(7,632)     $ 2,332     (3,802,666) $(12,721)

Net income for
   the six months
   ended December
   31, 2005                                                              2,576                                           $ 2,576

Translation
   adjustment                                                                        (1,006)                              (1,006)

Unrealized gain
   on available-
   for-sale
   securities,
   net of tax                                                                           139                                  139

Deferred stock
   based compen-
   sation                                                       134

Unrealized gain
   on forward
   contracts, net
   of tax                                                                                29                                   29
                                                                                                                         -------
Comprehensive
   Income                                                                                                                $ 1,738
                                                                                                                         =======
Conversion of
   Shares              30,000            (30,000)

Shares issued
   under Stock
   Option Plan         42,500      1                             84
                   ----------   ----    --------    ---     -------    -------      -------     ----------  --------
Balance at
   December 31,
   2005            16,647,849   $167   2,107,883    $21     $57,283    $(5,056)     $ 1,494     (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,
                                                                  ------------------------
                                                                       2005      2004
                                                                     -------   -------
                                                                         
Cash flows from operating activities:
   Net income                                                        $ 2,576   $ 1,507
   Adjustments to reconcile net income to net cash
      provided (used) by operating activities:
         Depreciation and amortization                                   704       972
         Accrued retirement pay                                          479        80
         Provision for losses on accounts receivable                      53        51
         Stock option expense                                            134        --
         Deferred income taxes                                            51        21
         Changes in assets and liabilities:
            Accounts and notes receivable                               (805)    1,533
            Inventories                                                  307      (815)
            Prepaid expenses and other                                  (289)      837
            Other assets                                                 368      (636)
            Customer deposits                                            195       543
            Accrued compensation                                      (1,797)   (1,956)
            Payments against restructuring charges                        --      (347)
            Accounts and notes payable, trade                           (161)    1,064
            Income taxes payable                                         746      (989)
            Accrued and withheld taxes                                  (158)      (80)
            Other accounts payable and accrued liabilities               (59)     (495)
            Interest payable                                             (21)      (84)
                                                                     -------   -------
               Net cash provided by operating activities               2,323     1,206
                                                                     -------   -------

Cash flows from investing activities:
   Additions of property, plant and equipment                           (325)     (312)
   Additions of patents and trademarks                                  (293)     (317)
                                                                     -------   -------
               Net cash used by investing activities                    (618)     (629)
                                                                     -------   -------

Cash flows from financing activities:
   Long-term and short-term debt borrowings                              899        --
   Long-term and short-term debt repayments                             (596)     (535)
   Principal payments under capital lease obligations                    (56)      (61)
   Payment of debt financing costs                                        --      (259)
   Proceeds of stock option exercise                                      85        78
   Other long-term liabilities                                            42        48
                                                                     -------   -------
               Net cash provided (used) by financing activities          374      (729)
                                                                     -------   -------

Effects of exchange rate changes                                        (573)      811
                                                                     -------   -------
Net increase in cash and cash equivalents                              1,506       659
Cash and cash equivalents at beginning of period                      15,443    12,008
                                                                     -------   -------
Cash and cash equivalents at end of period                           $16,949   $12,667
                                                                     =======   =======


           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,
                                   ------------------
                                      2005    2004
                                      ----   ------
                                       
Cash paid during the period for:
   Interest                           $568   $1,607
   Income taxes                       $858   $2,029


           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 of a normal recurring nature, 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, 2005.

NOTE 2 - RECENTLY ISSUED ACCOUNTING STANDARDS:

     On June 1, 2005, the FASB issued Statement of Financial Accounting
Standards No. 154, "Accounting Changes and Error Corrections - a replacement of
APB Opinion No. 20 and FASB Statement No. 3" ("SFAS 154"). SFAS 154 changes the
requirements for the accounting and reporting of a change in accounting
principle. SFAS 154 applies to all voluntary changes in accounting principle as
well as changes required by an accounting pronouncement that do not otherwise
include specific transition provisions. Previously, most changes in accounting
principle were required to be recognized by including in net income of the
period of the change the cumulative effect of changing to the new accounting
principle. SFAS 154 requires retrospective application in prior periods'
financial statements of a change in accounting principle as if that principle
had always been used. In addition, SFAS 154 requires that retrospective
application of a change in accounting principle be limited to the direct effects
of the change while indirect effects should be recognized in the period of the
accounting change. SFAS 154 will be effective for fiscal years beginning after
December 15, 2005. The impact of the adoption of SFAS 154 will depend upon the
nature of accounting changes the Company may initiate in future periods, if any.

NOTE 3 - LONG TERM DEBT:

     Effective July 1, 2005, the Company amended its primary source of outside
financing, the revolving credit agreement with Maple Bank GmbH (the "Maple
Credit Agreement"). Borrowings under the credit facility are subject to a
borrowing base and bear interest at a rate equal to the three-month Euribor rate
(as defined in the Credit Agreement) plus (i) 3.375%, (5.125% for the period
ended December 31, 2005) for loans denominated in U.S. Dollars or (ii) 3.775%
(5.525% for the period ended December 31, 2005) for loans denominated in Euros.
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 Bank 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.


                                        7





                                                                     (IN THOUSANDS)
                                                       -----------------------------------------
                                                        DECEMBER 31, 2005       JUNE 30, 2005
                                                       -------------------   -------------------
                                                       CURRENT   LONG-TERM   CURRENT   LONG-TERM
                                                       -------   ---------   -------   ---------
                                                                        
Revolving Credit Facility due October 1, 2008,
   interest rate 5.525% plus three-month
   euribor rate (2.153% at June 30)...........          $   --    $    --     $   --    $11,504

Revolving Credit Facility due October 1, 2008,
   interest rate 3.775% plus three-month
   euribor rate (2.108% at December 31).......              --     11,254         --         --

Term loan payable by foreign subsidiary
   due September 2008, interest rate
   1.81%......................................   (a)       289        488         --         --

Term Loan payable by foreign subsidiary
   due December 8, 2006, interest rate 1.5%...             847         --        902        450

Note payable by foreign subsidiary
   through 2008, interest rate 5.95%..........             113        198        115        259

Note payable by foreign subsidiary
   through February 2007, interest rates
   ranging from 4.58% to 4.67%................               2         --         16         10
                                                        ------    -------     ------    -------
                                                        $1,251    $11,940     $1,033    $12,223
                                                        ======    =======     ======    =======


(a)  Yen 100,000,000 3-year term loan (approximately $882,000). Quarterly
     principal payments of Yen 8,333,000, interest rate at Tokyo Inter Bank
     offered rate (TIBOR) plus .075%. The interest rate swap converts variable
     rate to fixed rate of 1.81% and has the same maturity date as the term
     loan.

     The Company maintains relationships with both foreign and domestic banks,
which combined have extended short and long term credit facilities to the
Company totaling $35,824 including $30,000 available under the Maple GmbH Credit
Agreement. As of December 31, 2005, the Company had $17,251 outstanding under
these credit facilities, including $12,771 under the Maple GmbH 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 713,000 and 632,000 of potentially dilutive shares,
respectively for the three and six months ended December 31, 2005 and 418,000
and 448,000 of potentially dilutive shares, respectively, for the three and six
months ended December 31, 2004. Outstanding options to purchase 182,000 and
687,000 shares of the Company's common stock for the six months ended December
31, 2005 and 2004 respectively, are not included in the above calculation to
compute diluted net income per share as their exercise prices exceeded the
current market value of these shares.

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:


                                        8





                                                  (in thousands)
                                        ---------------------------------
                                        December 31, 2005   June 30, 2005
                                        -----------------   -------------
                                                   (Unaudited)
                                                      
Cumulative translation adjustments           $1,399            $2,407
Unrealized gain on investments,
   net of tax                                   179                40
Unrealized loss on forward
   contracts, net of tax                         (6)              (35)
Minimum pension liability, net of tax           (78)              (80)
                                             ------            ------
                                             $1,494            $2,332
                                             ======            ======


NOTE 6 - INVENTORIES:

     Inventories consist of the following:



                           (in thousands)
                 ---------------------------------
                 December 31, 2005   June 30, 2005
                 -----------------   -------------
                            (Unaudited)
                               
Raw materials         $11,438           $11,453
In process              4,490             4,409
Finished goods          5,950             6,893
                      -------           -------
                      $21,878           $22,755
                      =======           =======


     Foreign currency translation effects decreased inventories by $570 from
June 30, 2005 to December 31, 2005.

NOTE 7 - GOODWILL AND OTHER INTANGIBLE ASSETS:

     The changes in the carrying amount of goodwill for the six months ended
December 31, 2005 are as follows:



                                                (in thousands)
                                  ------------------------------------------
                                  Gross Carrying    Accumulated       Net
                                      Amount       Amortization   Book Value
                                  --------------   ------------   ----------
                                                         
Balance as of July 1, 2005           $14,378         $ 3,456       $10,922
Effects of currency translation         (637)           (173)         (464)
                                     -------         -------       -------
Balance as of December 31, 2005      $13,741         $(3,283)      $10,458
                                     =======         ========      =======


Intangible assets subject to amortization are comprised of the following:



                                           (in thousands)
                         -------------------------------------------------
                         As of December 31, 2005     As of June 30, 2005
                         -----------------------   -----------------------
                           Gross                     Gross
                         Carrying    Accumulated   Carrying    Accumulated
Intangible Assets:        Amount    Amortization    Amount    Amortization
------------------       --------   ------------   --------   ------------
                                                  
Patents and trademarks    $7,397       $4,750       $7,120       $4,559
Other                        897          710          937          746
                          ------       ------       ------       ------
Total                     $8,294       $5,460       $8,057       $5,305
                          ======       ======       ======       ======


     Amortization expense associated with these intangible assets was $121 and
$242, respectively, for the three and six months ended December 31, 2005 and
$207 and $368, respectively for the three and six months ended December 31,
2004. The other category is included in "Other assets" on the accompanying
consolidated balance sheets.


                                        9



NOTE 8 - 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 and six months ended
December 31, 2005 and 2004:



                                                      (in thousands)
                                        -----------------------------------------
                                          Pension Benefits      Pension Benefits
                                        For the three months   For the six months
                                         ended December 31,    ended December 31,
                                        --------------------   ------------------
                                            2005   2004           2005   2004
                                            ----   ----           ----   ----
                                                             
Service cost                                 $64    $67           $128   $134
Interest cost                                 12     15             24     30
Expected return on plan assets                (4)    (1)            (8)    (2)
Amortization of transition obligation          3      3              6      6
Amortization of net actuarial gain            (3)    --             (6)    --
                                             ---    ---           ----   ----
Net periodic benefit cost                    $72    $84           $144   $168
                                             ===    ===           ====   ====


     During the six months ended December 31, 2005 and 2004 the Company made
contributions to the plans of $204 and $173, respectively.

NOTE 9 - STOCK BASED COMPENSATION PLANS:

     Effective July 1, 2005 the Company adopted Statement of Financial
Accounting Standards (SFAS) No. 123 (revised 2004), (SFAS 123(R)) "Share Based
Payment". 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 had previously accounted 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 was reflected in net
income. The effect of initially applying SFAS 123(R) is recognized as of the
effective date using a modified prospective method. Under the modified
prospective method the Company recognized 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 in prior years.
Option awards, which when exercised would represent newly issued shares, are
generally granted with an exercise price equal to the market price at the date
of grant; generally vest in three equal annual installments commencing on the
second anniversary date of grant and have ten year contractual terms. The fair
value of each option award is estimated on the date of grant using the
Black-Scholes option pricing model at the grant date.

     The following table illustrates the effect on net income and income per
share applying the fair value recognition provisions of SFAS 123 (R) for the
three and six months ended December 31, 2005 and as if the fair value
recognition provisions had been applied for the three and six months ended
December 31, 2004:


                                       10





                                                       (in thousands, except share
                                                           and per share data)
                                                  -------------------------------------
                                                  Three months ended   Six months ended
                                                     December 31,        December 31,
                                                      (Unaudited)         (Unaudited)
                                                  ------------------   ----------------
                                                     2005     2004       2005     2004
                                                    ------   -----      ------   ------
                                                                     
Net income, as reported                             $1,383   $ 788      $2,576   $1,507
Add: stock-based employee
   compensation included in reported
   net income, net of related tax
   effects (pre-tax $62K for three
   months, $103K pre-tax for six months)                41      --          68       --
Deduct: Total stock-based employee compensation
   expense determined as if the fair
   value based method was
   used for all years presented                        (41)    (13)        (68)     (26)
                                                    ------   -----      ------   ------
Pro forma net income                                $1,383   $ 775      $2,576   $1,481
                                                    ======   =====      ======   ======

Income per share:
   Basic and diluted - as reported                  $ 0.09   $0.05      $ 0.17   $ 0.10
                                                    ======   =====      ======   ======
   Basic and diluted - pro forma                    $ 0.09   $0.05      $ 0.17   $ 0.10
                                                    ======   =====      ======   ======


Stock Options:

The following table summarizes stock option activity under the plans for the six
months of 2006:



                                                  THE 1986 PLAN                                     THE 1990 PLAN
                                ------------------------------------------------   -----------------------------------------------
                                                                      WEIGHTED                                          WEIGHTED
                                                                   AVERAGE PRICE                                     AVERAGE PRICE
                                                        OPTION     -------------                          OPTION     -------------
                                CLASS A    CLASS B   PRICE RANGE     A       B     CLASS A   CLASS B   PRICE RANGE     A       B
                                -------   --------   -----------   -----   -----   -------   -------   -----------   -----   -----
                                                                                               
Excercisable at June 30,
   2005......................   183,000    105,000   $3.00-$6.72   $4.21   $6.72    8,055      945     $2.56-$6.88   $4.40   $5.48
Granted......................
Canceled.....................   (92,000)  (105,000)  $5.38-$6.72   $5.41   $6.72   (2,694)    (306)    $5.50-$6.68   $5.50   $6.88
Exercised....................    (5,000)             $      3.00   $3.00
Outstanding at December 31,
   2005......................    86,000          0   $3.00-$5.62   $3.00            5,361      639     $2.56-$6.41   $3.84   $5.03
Exercisable at December 31,
   2005......................    86,000          0   $3.00-$5.62   $3.00            5,361      639     $2.56-$6.41   $3.84   $5.03




                                                  THE 1996 PLAN                                     THE 1998 PLAN
                                -------------------------------------------------   -----------------------------------------------
                                                                       WEIGHTED                                          WEIGHTED
                                                                    AVERAGE PRICE                                     AVERAGE PRICE
                                                         OPTION     -------------                          OPTION     -------------
                                 CLASS A    CLASS B   PRICE RANGE     A       B     CLASS A   CLASS B   PRICE RANGE     A       B
                                ---------   -------   -----------   -----   -----   -------   -------   -----------   -----   -----
                                                                                                
Outstanding at June 30,
   2005......................   1,275,667             $0.58-$5.50   $2.36            39,000             $1.13-$5.50   $2.48   $0.00
Granted......................     105,000                   $4.49   $4.49
Exercised....................     (37,500)            $1.05-$3.19   $1.86
Outstanding at December 31,
   2005......................   1,343,167             $0.58-$5.50   $2.54            39,000             $1.13-$5.50   $2.48
Exercisable at December 31,
   2005......................     603,319             $0.58-$5.50   $2.01            39,000             $1.13-$5.50   $2.48


     The total intrinsic value of options exercised during the three and six
months ended December 31, 2005 was $0 and $103,000 respectively.


                                       11



     The shares under option at December 31, 2005 were in the following price
ranges:



                       OPTIONS OUTSTANDING                              OPTIONS EXERCISABLE
                 ------------------------------              -----------------------------------------
                                   WEIGHTED       WEIGHTED     NUMBER      WEIGHTED       WEIGHTED
   RANGE OF       NUMBER OF         AVERAGE        AVERAGE       OF         AVERAGE        AVERAGE
   EXERCISE      OUTSTANDING       REMAINING      EXERCISE   EXERCISABLE   EXERCISE       REMAINING
    PRICES         OPTIONS     CONTRACTUAL LIFE     PRICE      OPTIONS       PRICE    CONTRACTUAL LIFE
--------------   -----------   ----------------   --------   -----------   --------   ----------------
                                                                    
$0.58 -- $3.75    1,292,170        6.8 years        $2.24      657,322       $1.78        5.3 years
$3.88 -- $6.88      181,997        6.9 years        $4.91       76,997       $5.49        2.9 years


     The aggregate intrinsic value of outstanding and exercisable options at
December 31, 2005 was $2,183,000 and $1,381,000, respectively.

Restricted Stock:

     During the quarter ended December 31, 2005, the Company granted 143,666
restricted shares/units of common stock, which are restricted for three years
from date of grant. The market value of the common stock at the date of grant
was $3.79 per share. Compensation expense of approximately $30,000 was
recognized during the quarter and six months ended December 31, 2005.

     In November 2005, shareholders approved the Company's 2005 Equity
Compensation Plan which allows for the granting, at fair market value on the
date of grant, of incentive stock options, non-qualified stock options, tandem
stock appreciation rights, restricted stock and restricted stock units for up to
1,200,000 shares of Class A common stock.

     At December 31, 2005, the aggregate number of shares available for future
grants under all the Company's share-based compensation plans is 1,485,167.

NOTE 10 - CUSTOMERS:

     During the three and six months ended December 31, 2005, one customer
accounted for more than 10% of the Company's net sales. Koenig and Bauer
Aktiengesellschaft ("KBA") accounted for approximately 17% of the Company's net
sales for each of the three and six months ended December 31, 2005 and
approximately 18% of the Company's net sales for each of the three and six
months ended December 31, 2004.

NOTE 11 - 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.



                                          (in thousands)
                                         Warranty Amount
                                        -----------------
                                          2005      2004
                                        -------   -------
                                            
Warranty reserve at June 30             $ 2,840   $ 2,714
Additional warranty expense accruals      1,732     2,171
Payments against reserve                 (1,823)   (2,128)
Effects of currency rate fluctuations       (68)      303
                                        -------   -------
Warranty reserve at December 31         $ 2,681   $ 3,060
                                        =======   =======



                                       12



                        BALDWIN TECHNOLOGY COMPANY, INC.

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

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, and (vii) competitive market
influences. 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, 2005 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,
2005. There have been no material changes during the six months ended December
31, 2005.

OVERVIEW

     Baldwin Technology Company, Inc. is a leading global manufacturer of press
accessories and controls for the commercial and newspaper printing industries.
Baldwin offers its customers a broad range of market-leading technologies,
products and systems that enhance the quality of printed products and improve
the economic and environmental efficiency of printing presses. Headquartered in
Shelton, CT, the Company has sales and service centers and product development
and manufacturing operations in the Americas, Asia and Europe. Baldwin's
technology and products include cleaning systems, fluid management and ink
control systems, web press protection systems and drying systems.

     The Company manages its business as one reportable business segment built
around its core competency in accessories and controls.

     For the three and six months ended December 31, 2005 net sales were
$43,826,000 and $86,471,000, respectively, representing approximately a 6%
improvement over the previous year's corresponding period as reported. During
the three and six month periods, increases in revenue are attributable to the
steady and stable growth in worldwide printing markets, particularly the
commercial printing markets increasing demand for the products supplied by the
Company.


                                       13



     For the three and six months ended December 31, 2005 gross margins improved
approximately 3% versus the prior year's corresponding periods. The increase in
gross profit margins is attributable to the increased sales volume noted above,
favorable overhead absorption, and lower technical service and warranty costs.

     Operating income increased to 5% of sales for the three and six months
ended December 31, 2005 versus 3% for the three and six month period ended
December 31, 2004, primarily as a result of the increased revenue and improved
gross margins.

     In addition, the Company reduced its interest expense in both the three and
six months ended December 31, 2005 versus the previous year's corresponding
periods as a result of lower average debt levels and reduced interest rates,
while recording lower royalty income.

SIX MONTHS ENDED DECEMBER 31, 2005 VS. SIX MONTHS ENDED DECEMBER 31, 2004

CONSOLIDATED RESULTS

NET SALES

     Net sales for the six months ended December 31, 2005 increased by
$5,242,000, or 6%, to $86,471,000 from $81,229,000 for the six months ended
December 31, 2004. Currency rate fluctuations attributable to the Company's
overseas operations decreased net sales by $3,773,000 in the current period,
otherwise, net sales would have increased by $9,015,000 or 11%.

     The net sales increase reflects higher sales volumes in Europe, $7,218,000.
Increasing demand, fueled by increased penetration into selected OEM's and
improving market conditions, particularly in Germany, has resulted in higher
shipments of the Company's cleaning systems, spray dampening systems, water
systems and web controls into the commercial market. In addition, higher
shipments of cleaning systems into the newspaper market serviced by Sweden added
to the increased revenues in Europe. In the Americas, particularly the U.S.,
sales increased $2,625,000. This increase was primarily driven by increased
demand in the commercial market for cleaning systems and web controls. In Asia,
sales declined $828,000 as softness in the Japanese markets was partially offset
by increases in the markets served by the Company's Australian subsidiary.

GROSS PROFIT

     Gross profit for the six months ended December 31, 2005 was $28,842,000
(33.4% of net sales) as compared to $24,797,000 (30.5% of net sales) for the six
months ended December 31, 2004, an increase of $4,045,000 or 16.0%. Currency
rate fluctuations decreased gross profit by $1,451,000 in the current period.
Excluding the effects of currency rate fluctuation, gross profit would have
increased by $5,496,000. Gross profit as a percentage of net sales increased
primarily due to the higher sales volume noted above, favorable sales mix and
favorable cost absorption associated with the higher sales and lower service,
warranty and material costs.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

     Selling, general and administrative expenses amounted to $16,725,000 (19.3%
of net sales) for the six months ended December 31, 2005 as compared to
$14,915,000 (18.4% of net sales) for the same period in the prior fiscal year,
an increase of $1,810,000 or 12.2%. Currency rate fluctuations decreased these
expenses by $573,000 in the current period. Otherwise, selling, general and
administrative expenses would have increased, $2,381,000 or 16%. Selling
expenses increased by $452,000. The increase is primarily driven by increased
business activity and reflects increased compensation and travel associated
costs, and increased commission costs. General and administrative expenses
increased $1,929,000 primarily due to


                                       14



increased incentive compensation accruals, vesting associated with deferred
compensation plans and higher outside consulting services primarily for the
Sarbanes-Oxley Act of 2002 implementation, tax, audit and other financial
services.

ENGINEERING AND DEVELOPMENT EXPENSES

     Engineering and development expenses increased $376,000 over the same
period in the prior fiscal year. Currency rate fluctuations decreased these
expenses by $374,000 in the current period. Excluding the effects of currency
rate fluctuations, engineering and development expenses would have increased by
$750,000 in the current period. This increase primarily relates to planned
investment and increased activity in product development management in Europe
and Japan. As a percentage of net sales, engineering and development expenses
was approximately 9% for the six months ended December 31, 2005 and 2004.

INTEREST AND OTHER

     Interest expense for the six months ended December 31, 2005 was $547,000 as
compared to $1,523,000 for the six months ended December 31, 2004. Currency rate
fluctuations decreased interest expense by $36,000 in the current period,
otherwise, interest expense decreased by $940,000. This decrease reflects the
lower average debt level of approximately $9.6 million versus the period ended
December 31, 2004 coupled with lower interest rates in effect for the six months
ended December 31, 2005 as a result of the amended loan agreement with Maple
GmbH and lower amortization of debt financing costs. Interest income amounted to
$61,000 and $53,000 for the six months ended December 31, 2005 and 2004,
respectively.

     Net royalty income for the six months ended December 31, 2005 was $200,000
as compared to $1,517,000 for the six months ended December 31, 2004. This
decrease reflects the expiration in February 2005 of a group of patents which
were the source of the royalty income.

     Other (income) expense, net amounted to expense of $79,000 for the six
months ended December 31, 2005 compared to expense of $124,000 for the six
months ended December 31, 2004. Other income (expense), net includes net foreign
currency transaction (losses) of $120,000 and $107,000 for the six months ended
December 31, 2005 and 2004, respectively.

INCOME TAXES

     The Company recorded an income tax provision of $1,578,000 for the six
months ended December 31, 2005 as compared to $1,077,000 for the six months
ended December 31, 2004. The effective tax rate of 38.0% for the six months
ended December 31, 2005 is reflective of greater taxable income in higher tax
jurisdictions for which tax loss carryforwards are not available. Partially
offsetting the increased tax expense is a reversal of a previously established
contingent tax liability of $75,000 which is no longer deemed probable. In
addition the effective tax rate for the six months ended December 31, 2005
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 continues to assess the need for its deferred tax asset
valuation allowance in the jurisdictions in which it operates. Any adjustments
to the deferred tax asset valuation allowance either positive or negative would
be recorded in the income statement of the period that the adjustment was
determined to be required. In particular, the Company is monitoring positive
earnings trends and other positive evidence in the U.S., U.K, and France to
determine if such trends could possibly require a reversal of valuation
allowances.


                                       15



NET INCOME

     The Company's net income amounted to $2,576,000 for the six months ended
December 31, 2005, compared to a net income of $1,507,000 for the six months
ended December 31, 2004. Currency rate fluctuations decreased net income by
$213,000 in the current period. Net income per share amounted to $0.17 basic and
diluted for the six months ended December 31, 2005, as compared to net income
per share of $0.10 basic and diluted for the six months ended December 31, 2004.

THREE MONTHS ENDED DECEMBER 31, 2005 VS. THREE MONTHS ENDED DECEMBER 31, 2004

CONSOLIDATED RESULTS

NET SALES

     Net sales for the three months ended December 31, 2005 increased by
$2,594,000, or 6%, to $43,826,000 from $41,232,000 for the three months ended
December 31, 2004. Currency rate fluctuations attributable to the Company's
overseas operations decreased net sales by $3,524,000 in the current period,
otherwise, net sales would have increased by $6,118,000 or 15%.

     The net sales increase reflects higher sales volumes in Europe, $5,140,000.
Increasing demand, particularly in Germany, has resulted in higher shipments of
the Company's cleaning systems, spray dampening systems, water systems and web
controls into the commercial market. In addition, higher shipments of cleaning
systems into the newspaper market serviced by Sweden added to the increased
revenues in Europe. In the Americas, particularly the U.S., sales increased
$1,699,000. This increase was primarily driven by increased demand in the
commercial market for cleaning systems web controls and dryers. In Asia, sales
declined $721,000 as softness in the Japanese markets was partially offset by
increases in the markets served by the Company's Australian subsidiary.

GROSS PROFIT

Gross profit for the three months ended December 31, 2005 was $14,786,000 (33.7%
of net sales) as compared to $12,707,000 (30.8% of net sales) for the three
months ended December 31, 2004, an increase of $2,079,000. Currency rate
fluctuations decreased gross profit by $1,336,000 in the current period.
Excluding the effects of currency rate fluctuation, gross profit would have
increased by $3,415,000. Favorable sales volume coupled with favorable cost
absorption and lower technical service, warranty and material costs primarily
accounts for the improvement in gross margin.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

     Selling, general and administrative expenses amounted to $8,603,000 (19.6%
of net sales) for the three months ended December 31, 2005 as compared to
$7,582,000 (18.4% of net sales) for the same period in the prior fiscal year, an
increase of $1,021,000 or 13%. Currency rate fluctuations decreased these
expenses by $530,000 in the current period. Otherwise, selling, general and
administrative expenses would have increased by $1,551,000. Selling expenses
increased by $342,000, reflecting the higher level of business activity as the
increase primarily relates to increased compensation, travel costs and
commissions. General and administrative expenses increased by $1,209,000
primarily due to higher accruals related to incentive compensation, stock
option/restricted stock plans, tax, audit and other financial services.

ENGINEERING AND DEVELOPMENT EXPENSES

     Engineering and development expenses remained virtually flat at $3,818,000
over the same period in the prior fiscal year. Currency rate fluctuations
decreased these expenses by $343,000 in the current period. Excluding the
effects of currency rate fluctuations, engineering


                                       16



and development expenses would have increased by $299,000 in the current period.
This increase relates primarily to planned investment in product development. As
percentage of net sales, engineering and development expenses remained at
approximately 9% for the three months ended December 31, 2005 and 2004.

INTEREST AND OTHER

     Interest expense for the three months ended December 31, 2005 was $249,000
as compared to $571,000 for the three months ended December 31, 2004. Currency
rate fluctuations decreased interest expense by $33,000 in the current period,
otherwise, interest expense decreased by $289,000. This decrease was primarily
due to lower interest rates in effect for the three months ended December 31,
2005 as a result of the amended credit agreement with Maple Bank GmbH, and lower
overall debt levels for the current period versus the same period a year ago.
Interest income amounted to $33,000 and $30,000 for the three months ended
December 31, 2005 and 2004, respectively.

     Net royalty income for the three months ended December 31, 2005 was $0 as
compared to $763,000 for the three months ended December 31, 2004. This decrease
reflects the expiration in February 2005 of a group of patents which were the
source of the royalty income.

     Other (income) expense, net amounted to expense of $12,000 for the three
months ended December 31, 2005 compared to expense of $137,000 for the three
months ended December 31, 2004. Other income (expense), net includes net foreign
currency transaction losses of $9,000 and of $119,000 for the three months ended
December 31, 2005 and 2004, respectively.

INCOME TAXES

     The Company recorded an income tax provision of $754,000 for the three
months ended December 31, 2005 as compared to $558,000 for the three months
ended December 31, 2004. The effective tax rate of 35.3% for the three months
ended December 31, 2005 is primarily due to greater taxable income in higher tax
jurisdictions and in which tax loss carryforwards are not available partially
offset by the reversal of a previously established contingency reserve of
$75,000 which was determined during the quarter to no longer be a probable
exposure. In addition the effective tax rate for the three months ended December
31, 2005 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.

NET INCOME

     The Company's net income amounted to $1,383,000 for the three months ended
December 31, 2005, compared to $788,000 for the three months ended December 31,
2004. Currency rate fluctuations decreased net income by $208,000 in the current
period. Net income per share amounted to $0.09 basic and diluted for the three
months ended December 31, 2005, as compared to $0.05 basic and diluted for the
three months ended December 31, 2004.


                                       17



              LIQUIDITY AND CAPITAL RESOURCES AT DECEMBER 31, 2005

     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:



                                               2005         2004
                                            ----------   ----------
                                                   
Cash provided by (used for):
Operating activities                        $2,323,000   $1,206,000
Investing activities                          (618,000)    (629,000)
Financing activities                           374,000     (729,000)
Effect of exchange rate changes on cash       (573,000)     811,000
                                            ----------   ----------
Net increase in cash and cash equivalents   $1,506,000   $  659,000
                                            ==========   ==========


     Cash provided by operating activities increased $1,117,000 during the six
months ended December 31, 2005 versus the prior year period. Higher revenues and
improved profitability has led to higher cash receipts from sales during the six
months ended December 31, 2005. Asset management additionally led to a decline
in accounts receivable days sales outstanding (52 days in FY 2006 vs. 58 days in
FY 2005) an increase in inventory turns (5.3 x in FY 2006 vs. 4.1 x in FY 2005)
while days payable outstanding has remained relatively flat at 44 days.

     The Company utilized $618,000 and $692,000 for investing activities for the
six months ended December 31, 2005 and 2004 respectively, for additions to
property, plant and equipment and patents and trademarks.

During the quarter ended September 30, 2005 the Company obtained a three-year
term loan with Mizuho Bank of YEN 100,000,000, approximately $882,000 U.S.
dollars which matures in September 2008. This term loan is subject to quarterly
principal payments of YEN 8,333,000 and bears interest at the Tokyo Inter Bank
Offered Rate ("TIBOR") plus 0.75%. Concurrently, the Company entered into an
interest swap agreement with maturity the same as the credit facility with
Mizuhao Bank which effectively converted the variable rate debt into fixed rate
with an interest rate of 1.81%.

     Effective July 1, 2005, the Company amended its primary source of outside
financing, the revolving credit agreement with Maple Bank GmbH. Borrowings under
the amended credit facility are subject to a borrowing base and bear interest at
a rate equal to the three-month Euribor rate (as defined in the Credit
Agreement) plus (i) 3.375% (5.125% for the period ended December 31, 2004) for
loans denominated in U.S. Dollars or (ii) 3.775% (5.525% for the period ended
December 31, 2004) for loans denominated in Euros. 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. Management also expects that as a result of
the aforementioned amendment and full amortization of debt financing costs
during fiscal year 2005 interest expense for the full year ending June 30, 2006
will be approximately $1,300,000 lower than for fiscal year ended June 30, 2005.

     The Company maintains relationships with both foreign and domestic banks,
which combined have extended credit facilities to the Company totaling
$35,824,000, including $30,000,000 available under the Maple Credit Agreement.
As of December 31, 2005, the Company had $17,251,000 outstanding under these
credit facilities with $12,771,000 (including letters of credit) under the Maple
Credit Agreement. Additionally, in January 2006 the Company further reduced its
debt with Maple with a payment of approximately $1,500,000.


                                       18



     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, 2005 and June 30, 2005, 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, 2005 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                                                    2011
                                             December                                                     and
                                             30, 2005    2006*    2007     2008      2009     2010    thereafter
                                             --------   ------   ------   ------   -------   ------   ----------
                                                                                 
Contractual Obligations:
Loans payable                                 $ 2,544   $2,544   $   --   $   --   $    --   $   --     $   --
Capital lease obligations                         116       33       42       25        15        1         --
Long-term debt                                 13,191      615      824      398    11,354       --         --
Non-cancelable operating lease obligations     24,641    2,176    5,837    3,209     2,366    1,455      9,598
Interest expense (1)                            2,646      514      958      958       216       --         --
                                              -------   ------   ------   ------   -------   ------     ------
Total contractual cash obligations            $43,138   $5,882   $7,661   $4,590   $13,951   $1,456     $9,598
                                              =======   ======   ======   ======   =======   ======     ======


*    Includes only the remaining six months of the fiscal year ending June 30,
     2006.

(1)  the anticipated future interest payments are based on the Company's current
     indebtedness and interest rates at December 31, 2005, with consideration
     given to debt reduction as the result of expected payments.

IMPACT OF INFLATION

     The Company's results are affected by the impact of inflation on
manufacturing and operating costs. Historically, the Company has used selling
price adjustments, cost containment programs and improved operating efficiencies
to offset the otherwise negative impact of inflation on its operations.

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, 2005. There have
been no material changes during the three and six months ended December 31,
2005.

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


                                       19



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 the Company's fiscal
quarter December 31,2005, 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, 2005, that have
materially affected, or are reasonably likely to materially effect, the
Company's internal control over financial reporting.

                           PART II: OTHER INFORMATION

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

     There was no activity under the Company's stock repurchase program for the
period ended December 31, 2005.

ITEM 6. EXHIBITS

(a)  Exhibits


      
10.75*   Retirement Allowance Plan for Representative Directors and Directors of
         Baldwin-Japan Ltd. (filed herewith).

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).



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                                   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 10, 2006


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