<PAGE>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549


                                    FORM 10-Q

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

              For Quarterly Period Ended September 30, 1998

          [ ] 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 1-3672.


                     CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
             (Exact name of registrant as specified in its charter)


         Illinois                                                37-0211380
(State or other jurisdiction of                               (I.R.S. Employer
incorporation or organization)                               Identification No.)


               607 East Adams Street, Springfield, Illinois 62739
              (Address of principal executive offices and Zip Code)



                         Registrant's telephone number,
                       including area code: (217) 523-3600



         Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.



                           Yes    X   .     No       .
                               -------         -------



Shares  outstanding  of  each  of  registrant's  classes of  common stock  as of
  October 31, 1998:

    Common Stock,  no par value,  held by Ameren Corporation (parent  company of
      Registrant) - 25,452,373


<PAGE>


                     Central Illinois Public Service Company

                                      Index

                                                                        Page No.

Part I        Financial Information (Unaudited)

              Management's Discussion and Analysis                         2

              Balance Sheet
              - September 30, 1998 and December 31, 1997                   8

              Statement of Income
              - Three months, nine months and 12 months ended
                 September 30, 1998 and 1997                               9

              Statement of Cash Flows
              - Nine months ended September 30, 1998 and 1997             10

              Notes to Financial Statements                               11


Part II       Other Information                                           12




<PAGE>



                    PART I. FINANCIAL INFORMATION (UNAUDITED)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS

OVERVIEW

Central  Illinois  Public Service  Company  (AmerenCIPS or the  Registrant) is a
subsidiary of Ameren Corporation  (Ameren), a holding company,  registered under
the Public Utility Holding Company Act of 1935 (PUHCA).  In December 1997, Union
Electric Company  (AmerenUE) and CIPSCO  Incorporated  (CIPSCO) combined to form
Ameren,  with  AmerenUE and CIPSCO's  subsidiaries,  the  Registrant  and CIPSCO
Investment  Company (CIC),  becoming  wholly-owned  subsidiaries  of Ameren (the
Merger).

The following  discussion and analysis  should be read in  conjunction  with the
Notes  to  Financial  Statements  beginning  on page  11,  and the  Management's
Discussion and Analysis of Financial Condition and Results of Operations (MD&A),
the Audited Financial Statements and the Notes to Financial Statements appearing
in the Registrant's 1997 Form 10-K.

RESULTS OF OPERATIONS

Earnings
Third  quarter  1998  earnings of $39 million  increased  $7 million from 1997's
third quarter  earnings.  Earnings for the nine months ended  September 30, 1998
increased $12 million from the year-ago period to $68 million.  Earnings for the
12 months ended September 30, 1998 were $47 million, a $19 million decrease from
the preceding  12-month period.  Excluding the extraordinary  charge recorded in
the fourth quarter of 1997 to write off the generation-related regulatory assets
and liabilities of the Registrant's Illinois retail electric business,  earnings
for the 12-month period ended September 30, 1998 were $72 million.

Earnings  fluctuated  due to many  conditions,  the primary ones being:  weather
variations,   sales  growth,  fluctuating  operating  costs,  the  write-off  of
generation-related  regulatory assets and liabilities,  merger-related costs and
targeted  separation  plan expense.  The significant  items affecting  revenues,
costs and earnings during the three-month, nine-month and 12-month periods ended
September 30, 1998, and 1997 are detailed below.

<TABLE>
<CAPTION>

Electric Operations

Electric Operating Revenues                     Variations for periods ended September 30, 1998
                                                     from comparable prior-year periods
--------------------------------------------- ---------------- --------------- -----------------
(Millions of Dollars)                           Three Months     Nine Months     Twelve Months
--------------------------------------------- ---------------- --------------- -----------------
<S>                                              <C>              <C>              <C>   
Effect of abnormal weather                        $   16           $   23           $   22
Growth and other                                       5               21               41
Interchange sales                                      1              (10)             (32)
--------------------------------------------- ---------------- --------------- -----------------
                                                  $   22           $   34           $   31
--------------------------------------------- ---------------- --------------- -----------------
</TABLE>


Electric revenues for the three months and nine months ended September 30, 1998,
increased  $22 million and $34 million,  respectively,  compared to the year-ago
periods  primarily  due to warmer  summer  weather  and  growth  in the  service
territory.  Weather-sensitive  residential  and  commercial  sales  increased 13
percent and 10 percent,  respectively,  for the three months ended September 30,
1998,  versus the prior year periods and 9 percent and 7 percent,  respectively,
for the nine months ended September 30, 1998,  compared to the year-ago periods.
Industrial sales increased 5 percent and 6 percent,  respectively, for the three
months and nine months ended September 30, 1998, versus the prior year periods.

Electric  revenues for the 12 months ended  September  30, 1998,  increased  $31
million  from the prior  12-month  period  due to an  increase  in native  sales
resulting  primarily from warmer  weather and a strong local economy,  partially
offset by lower  interchange  sales  caused by  decreased  sales  opportunities.
Residential sales increased 7 percent,  and commercial and industrial sales both
increased 5 percent for the 12 months ended September 30, 1998, versus the prior
year period.

                                      -2-
<PAGE>

<TABLE>
<CAPTION>


Fuel and Purchased Power
                                                 Variations for periods ended September 30, 1998
                                                        from comparable prior-year periods
--------------------------------------------- ------------------- --------------- -----------------
(Millions of Dollars)                            Three Months       Nine Months     Twelve Months
--------------------------------------------- ------------------- --------------- -----------------
<S>                                                <C>               <C>              <C>
Fuel:
    Variation in generation                         $   1             $ (14)           $ (15)
     Price                                             (2)                1                -
     Generation efficiencies and other                 (1)               (1)               -
Purchased power variation                               7                19               14
--------------------------------------------- ------------------- --------------- -----------------
                                                    $   5             $   5            $  (1)
--------------------------------------------- ------------------- --------------- -----------------
</TABLE>


The  increase  in fuel and  purchased  power  costs for the three  months  ended
September 30, 1998,  versus the comparable  prior year quarter was primarily the
result of higher sales volume.

Fuel and  purchased  power costs for the nine months ended  September  30, 1998,
versus the prior year increased due to increased power purchases  resulting from
higher sales volume, partially offset by lower generation.

The decrease in fuel and purchased power costs for the 12 months ended September
30,  1998,  versus  the  year-ago  period was  driven  mainly by a  decrease  in
interchange sales,  partially offset by an increase in purchased power due to an
increase in native load sales.

While  unprecedented  prices for power  purchases  occurred  in the  marketplace
during the last week of June 1998, the Registrant was able to effectively manage
its power costs in the face of soaring wholesale  electricity  prices.  Overall,
the abnormally  high prices for power purchases in June had little impact on the
Registrant's financial results for the periods presented.

Gas Operations
Gas  revenues  for the nine  months  and 12 months  ended  September  30,  1998,
decreased $9 million and $13 million, respectively, due to lower sales resulting
from milder  winter  weather and lower gas costs  reflected in the purchased gas
adjustment clause.

Gas costs for the nine months and 12 months ended September 30, 1998,  decreased
$10 million and $11 million, respectively,  compared to the year-ago period. The
decreases  in gas costs for these  periods  were  primarily  due to lower  sales
volume.

Other Operating Expenses
Other operating expense variations  reflected  recurring factors such as growth,
inflation and labor  increases in addition to a one-time charge for the targeted
separation plan as described below.

In March 1998,  Ameren  announced plans to reduce its other operating  expenses,
including plans to eliminate  approximately  400 employee  positions by mid-1999
through a hiring freeze and a targeted  separation plan (the TSP). In July 1998,
Ameren  offered  separation  packages to employees  whose  positions  were to be
eliminated  through  the TSP.  In the  third  quarter  of 1998,  the  Registrant
recorded a one-time,  pretax  charge of $7 million  (which  reduced  earnings $4
million)  representing  its share of costs  incurred to  implement  the TSP. The
Registrant  expects  that the hiring  freeze and TSP will  reduce its  operating
expenses by approximately $4 million in 1998 and $7 million annually thereafter.

Other operations expenses increased $9 million,  $14 million and $15 million for
the three months,  nine months and 12 months ended September 30, 1998,  compared
to  the  same  year-ago  period  primarily  due  to  the  TSP  and  increases in
information system related costs and injuries and damages expense.

Maintenance expenses for the nine months and 12 months ended September 30, 1998,
increased $2 million and $11 million,  respectively,  from the comparable  prior
year period due to increased scheduled fossil power plant maintenance.

                                      -3-

<PAGE>

Depreciation  and  amortization  expense  for the  three-month,  nine-month  and
12-month periods ended September 30, 1998,  decreased $2 million, $7 million and
$8 million,  respectively,  versus the comparable 1997 periods  primarily due to
the fourth quarter 1997 write-off of generation  related  regulatory  assets and
liabilities of the Registrant's retail electric business.

Taxes
Income taxes charged to operating  expenses for the three months and nine months
ended  September  30, 1998,  increased $6 million and $7 million,  respectively,
versus the year-ago period due primarily to higher pretax income in 1998.

Income taxes charged to operating expenses for the 12 months ended September 30,
1998,  increased $3 million  versus the year-ago  period due primarily to higher
pretax income before the extraordinary charge in 1998.

Balance Sheet

Changes in accounts and wages payable,  taxes accrued,  other accruals and other
current assets result from the timing of various payments to taxing  authorities
and suppliers.

LIQUIDITY AND CAPITAL RESOURCES

Cash provided by operating  activities  totaled $120 million for the nine months
ended September 30, 1998,  compared to cash provided by operating  activities of
$59 million during the same 1997 period.

Cash flows used in investing  activities totaled $46 million and $79 million for
the nine months ended  September 30, 1998 and  September 30 1997,  respectively.
Construction  expenditures  for the nine  months  ended  September  30, 1998 for
constructing new or improving  existing  facilities and complying with the Clean
Air Act were $47 million.  Capital  requirements  for the  remainder of 1998 are
expected to be principally for construction expenditures.

Cash flows used in  financing  activities  were $67  million for the nine months
ended September 30, 1998,  compared to cash provided by financing  activities of
$21 million during the same 1997 period.  The Registrant's  principal  financing
activities for the nine months ended September 30, 1998 included a debt issuance
of $10  million,  the  redemption  of debt of $21  million  and the  payment  of
dividends.

The Registrant  plans to continue  utilizing  short-term  debt to support normal
operations and other temporary requirements. The Registrant is authorized by the
Securities  and  Exchange  Commission  under PUHCA to have up to $250 million of
short-term  unsecured debt instruments  outstanding at any one time.  Short-term
borrowings  consist of bank loans  (maturities  generally on an overnight basis)
and commercial paper  (maturities  generally within 10 to 45 days). At September
30, 1998,  the Registrant  had committed  bank lines of credit  aggregating  $80
million (of which $80 million were unused and $26 million were available at such
date) which make available  interim financing at various rates of interest based
on LIBOR,  the bank  certificate of deposit rate or other options.  The lines of
credit are renewable annually at various dates throughout the year. At September
30, 1998, the Registrant had $54 million of short-term borrowings.

CONTINGENCIES

On March 27,  1998, a jury awarded a total of $3 million to the families of four
children who  contracted  neuroblastoma  (a rare form of cancer)  following  the
Registrant's  1987  clean-up  of  a  former   manufactured  gas  plant  site  in
Taylorville,  Illinois.  The Registrant  continues to believe it has meritorious
defenses and has appealed the verdict.  The  Registrant  believes that the final
disposition  of this  matter  will not have a  material  adverse  effect  on its
financial position, results of operations or liquidity.

RATE MATTERS

As a result of the Electric  Service Customer Choice and Rate Relief Law of 1997
(the  Law)  providing  for  electric  utility  restructuring  in  Illinois,  the
Registrant  filed  proposals  with the  Illinois  Commerce  Commission  (ICC) to
eliminate the electric fuel  adjustment  clause for Illinois  retail  customers,
thereby  including  a  historical  level of fuel  costs in base  rates.  The ICC
approved the Registrant's filing on March 25, 1998.

                                      -4-

<PAGE>

In June 1998, the Registrant  filed a residential rate reduction tariff with the
ICC to comply with the requirements of the Law. Under the provisions of the Law,
a rate decrease of 5 percent became effective for Illinois  residential electric
customers  beginning  August 1, 1998.  This rate  decrease is expected to reduce
electric  revenues  approximately  $5 million in 1998 and $11  million  annually
thereafter,  based  on  estimated  sales  levels  and  assuming  normal  weather
conditions.

Also in June 1998, the Registrant filed a request with the ICC to increase rates
$15 million  annually for  natural gas  service.  In October 1998, the ICC staff
filed testimony  that recommended  an increase in  natural gas service  rates of
$6 million.  The ICC has until May 1999 to render a decision.

See Note 6 under Notes to Financial  Statements  for further  discussion of Rate
Matters.

ENVIRONMENTAL ISSUES

In July 1997,  the United States  Environmental  Protection  Agency (EPA) issued
final regulations  revising the National Ambient Air Quality Standards for ozone
and particulate  matter. At that time,  specific  emission control  requirements
were still  being  developed.  In  September  1998,  the EPA issued a final rule
pertaining  to  nitrogen  oxide  emissions,   which  will  require   significant
additional reductions in emissions from coal-fired boilers.  Illinois (where all
of the  Registrant's  coal-fired power plant boilers are located) is included in
the area targeted for nitrogen oxide  emissions  reductions as part of the EPA's
regional  control  program.  Reduction  requirements in nitrogen oxide emissions
from the Registrant's coal-fired boilers will exceed 75 percent from 1990 levels
by the year 2003. Because of the magnitude of these additional  reductions,  the
Registrant will be required to incur significantly  higher capital costs to meet
future  compliance  obligations for its coal-fired  boilers or to purchase power
from other sources,  either of which could have  significantly  higher operating
expenses  associated with compliance.  The significant  nitrogen oxide emissions
reductions  already  achieved on several of the  Registrant's  coal-fired  power
plants will help to reduce the costs of compliance with this regulation.

It is not yet possible to determine  the exact  magnitude of the nitrogen  oxide
emission reductions required on the Registrant's power plants because each State
has up to one year to  develop  a plan to  comply  with the EPA  rule.  However,
preliminary  analysis  of the  regulations  indicate  that  selective  catalytic
reduction  technology  will be required for some of the  Registrant's  units, as
well as other additional controls.

The full  details  of these  requirements  are  under  study by the  Registrant.
Currently,  the Registrant estimates that its additional capital expenditures to
comply with these regulations could range from $125-$175 million over the period
from 1999 to 2002.  Associated  operations and  maintenance  expenditures  could
increase $5-$8 million annually,  beginning in 2003. The Registrant will explore
alternatives to comply with these new  regulations in order to minimize,  to the
extent  possible,  its capital costs and operating  expenses.  At this time, the
Registrant is unable to predict the ultimate impact of these revised air quality
standards on its future financial condition, results of operations or liquidity.

YEAR 2000 ISSUE

The Year  2000  Issue  relates  to how  dates are  stored  and used in  computer
systems,  applications, and embedded systems. As the century date change occurs,
certain date-sensitive systems need to be able to recognize the year as 2000 and
not as 1900.  This inability to recognize or properly treat the year as 2000 may
cause these systems to process  critical  financial and operational  information
incorrectly.   The  Registrant's  primary  concern  is  the  potential  for  any
interruption in providing electric and gas service to customers,  as well as the
potential to be unable to process critical financial and operational information
on a timely basis, including billing its customers, if appropriate steps are not
taken to address this issue.

Management  has  developed  a  Year 2000 plan (Plan) covering Ameren,  including
AmerenCIPS, and Ameren's Board of Directors has been briefed about the Year 2000
Issue and how it may affect the Registrant.

Ameren's Plan to resolve the Year 2000 Issue involves three phases:  assessment,
planning,  and  implementation/testing.  Implementation  of the Plan is directly
supervised  by each  area's  responsible  Vice  President.  A Year 2000  Project
Director  coordinates the  implementation of the Plan among functional teams who
are  addressing  issues  specific  to a  particular  area,  such as nuclear  and
non-nuclear generation facilities, energy

                                      -5-

<PAGE>

management systems, etc. Ameren has also  engaged  certain outside  consultants,
technicians and other  external resources to aid in formulating and implementing
the Plan.

Ameren is  approximately 95 percent  complete with its assessment  phase,  which
included analyzing date-sensitive electronic hardware, software applications and
embedded systems and has developed a compliance plan to address issues that were
identified.  Many  of  the  major  corporate  computer  systems  at  Ameren  are
relatively  new and  therefore  are either Year 2000  compliant  or only require
minor  modifications.  Also,  several of the  operating  hardware  and  embedded
systems (i.e. microprocessor chips) use analog technology instead of digital and
thus are  unaffected  by the  two-digit  date  issue.  In  addition,  Ameren has
contacted hundreds of vendors and suppliers to verify compliance. The assessment
phase is expected to be completed by the end of the first quarter 1999.

Ameren is also  approximately 95 percent complete with its planning phase. Items
which have been identified for  remediation  have been  prioritized  into groups
based on their significance to company  operations.  The  implementation/testing
phase  for all  components/applications  is  approximately  40%  complete  as of
September 30, 1998.  Ameren expects to complete  remediation of its  significant
components/applications by the end of the third quarter 1999.

With  respect  to  third  parties,   for  areas  that  interface  directly  with
significant  vendors,  Ameren has inventoried vendors and major suppliers and is
currently  assessing  their Year 2000 readiness  through  surveys,  websites and
personal contact. Ameren plans to follow up with major suppliers and verify Year
2000 compliance where  appropriate.  Ameren has queried its important  suppliers
and health  insurance  providers.  To date,  Ameren is not aware of any problems
that would  materially  impact  financial  condition,  results of  operations or
liquidity. Neither Ameren or the Registrant has the means of ensuring that these
parties will be Year 2000 compliant.  The inability of those parties to complete
their  Year 2000  resolution  process  could  materially  impact  Ameren and the
Registrant.

Ameren is also  addressing  the impact of electric  power grid problems that may
occur outside of its own electric system.  Ameren has started year 2000 electric
power grid impact planning through the system's various electric interconnection
affiliations, and is working with the Mid-American Interchange Network (MAIN) to
begin planning year 2000 operational  preparedness and restoration scenarios. In
addition,  Ameren provides monthly status reports to the North American Electric
Reliability  Council  (NERC) to assist them in assessing  year 2000 readiness of
the regional  electric  grid.  Through the  Electric  Power  Research  Institute
(EPRI),  an  industry-wide  effort has been  established  to deal with year 2000
problems  affecting  digital systems and equipment used by the nation's electric
power companies. Under this effort, participating utilities are working together
to assess specific  vendors' system problems and test plans. The assessment will
be shared by the industry as a whole to facilitate year 2000 problem solving.

In addressing  the Year 2000 Issue,  Ameren will incur  internal  labor costs as
well as  external  consulting  and  other  expenses  related  to  infrastructure
enhancements necessary to prepare for the new century. Ameren estimates that its
external costs  (consulting fees and related costs) for addressing the Year 2000
Issue will range from $10 million to $15  million.  As of  September  30,  1998,
Ameren has expended  approximately  $2 million.  Ameren's plans to complete Year
2000  modifications are based on management's best estimates,  which are derived
utilizing  numerous   assumptions  of  future  events  including  the  continued
availability of certain resources,  and other factors.  However, there can be no
guarantee that these  estimates will be achieved and actual results could differ
materially  from those plans.  Specific  factors that might cause such  material
differences  include,  but are not  limited  to,  the  availability  and cost of
personnel  trained in this area,  the ability to locate and correct all relevant
computer codes, and similar uncertainties.

Ameren  believes  that,  with  appropriate  modifications  to existing  computer
systems/components,  updates by vendors and trading partners,  and conversion to
new  software and  hardware in the  ordinary  course of business,  the Year 2000
Issue  will  not  pose  significant  operational  problems  for the  Registrant.
However,  if such conversions are not completed in a proper and timely manner by
all  affected  parties,  the Year 2000 Issue could  result in  material  adverse
operational and financial  consequences  to the Registrant,  and there can be no
assurance  that  Ameren's  efforts,  or those of vendors and  trading  partners,
interconnection  affiliates, NERC or EPRI to address the Year 2000 Issue will be
successful.  Ameren is in the process of developing contingency plans to address
potential risks, including risks of vendor/trading  partners  noncompliance,  as
well as noncompliance of any of the Registrant's material operations.  The first
operational  contingency  plan is expected to be completed by year-end.  At this
time, the  Registrant is unable to predict the ultimate  impact of the Year 2000
Issue  on  the  Registrant's  financial  condition,  results  of  operations  or
liquidity; however, the impact could be material.

                                      -6-

<PAGE>

ACCOUNTING MATTERS

In June 1998,  the  Financial  Accounting  Standards  Board issued  Statement of
Financial   Accounting   Standards   (SFAS)  133,   "Accounting  for  Derivative
Instruments  and  Hedging  Activities."  SFAS  133  establishes  accounting  and
reporting  standards for derivative  instruments and for hedging  activities and
requires recognition of all derivatives on the balance sheet be measured at fair
value.  SFAS 133 is effective  for fiscal years  beginning  after June 15, 1999.
Earlier application is encouraged, but permitted only as of the beginning of any
fiscal  quarter that begins after  issuance of the standard.  At this time,  the
Registrant  is  unable to  determine  the  impact  of SFAS 133 on its  financial
position or results of operations upon adoption.

In February  1998,  the Financial  Accounting  Standards  Board issued SFAS 132,
"Employers' Disclosures about Pensions and Other Postretirement  Benefits." SFAS
132  revises  employers'  disclosures  about  pension  and other  postretirement
benefit plans.  SFAS 132 is effective for fiscal years  beginning after December
31, 1998, although earlier  application is encouraged.  SFAS 132 is not expected
to have a material impact on the Registrant's  financial  position or results of
operations upon adoption.

In March 1998,  the  Accounting  Standards  Executive  Committee of the American
Institute of Certified  Public  Accountants  issued  Statement of Position (SOP)
98-1,  "Accounting for the Costs of Computer Software  Developed or Obtained for
Internal  Use."  SOP 98-1  provides  guidance  on  accounting  for the  costs of
computer  software  developed  or obtained  for  internal  use.  Under SOP 98-1,
certain  costs,  which  are  currently  expensed  by  the  Registrant,   may  be
capitalized  and amortized  over some future  period.  SOP 98-1 is effective for
fiscal years beginning after December 15, 1998,  although earlier application is
encouraged.  SOP  98-1  is  not  expected  to  have  a  material  impact  on the
Registrant's financial position or results of operations upon adoption.

SAFE HARBOR STATEMENT

Statements made in this Form 10-Q which are not based on historical  facts,  are
forward-looking  and,  accordingly,  involve risks and uncertainties  that could
cause actual results to differ  materially from those  discussed.  Although such
forward-looking  statements  have  been  made in good  faith  and are  based  on
reasonable assumptions,  there is no assurance that the expected results will be
achieved.  These statements include (without limitation) statements as to future
expectations,   beliefs,  plans,  strategies,  objectives,  events,  conditions,
financial  performance  and "Year 2000"  issues.  In  connection  with the "Safe
Harbor" provisions of the Private Securities  Litigation Reform Act of 1995, the
Registrant is providing this cautionary  statement to identify important factors
that could cause actual  results to differ  materially  from those  anticipated.
Factors  include,  but are not limited to, the  effects of  regulatory  actions;
changes  in laws and other  governmental  actions;  competition;  future  market
prices for electricity;  average rates for electricity in the Midwest;  business
and  economic  conditions;  weather  conditions;  fuel prices and  availability;
generation  plant  performance;  monetary  and  fiscal  policies;  and legal and
administrative proceedings.

                                      -7-

<PAGE>

<TABLE>
<CAPTION>

                     CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
                                  BALANCE SHEET
                                    UNAUDITED
                      (Thousands of Dollars, Except Shares)


                                                             September 30, December 31,
ASSETS                                                            1998         1997
------                                                        ------------ ------------
<S>                                                            <C>          <C>
Property and plant, at original cost:
   Electric                                                     $2,362,769   $2,311,364
   Gas                                                             256,981      249,499
                                                                ----------   ----------
                                                                 2,619,750    2,560,863
   Less accumulated depreciation and amortization                1,177,938    1,132,591
                                                                ----------   ----------
                                                                 1,441,812    1,428,272
Construction work in progress                                       27,431       59,531
                                                                ----------   ----------
         Total property and plant, net                           1,469,243    1,487,803
                                                                ----------   ----------

Other assets                                                        30,185       30,476

Current assets:
   Cash and cash equivalents                                        12,728        6,040
   Accounts receivable - trade (less allowance for doubtful
         accounts of $1,219 and $1,200, respectively)               73,374       67,495
   Unbilled revenue                                                 39,093       31,708
   Other accounts and notes receivable                              30,913        7,760
   Materials and supplies, at average cost -
      Fossil fuel                                                   30,517       24,919
      Gas stored underground                                        12,968       14,275
      Other                                                         34,985       32,334
   Other                                                             8,765       32,637
                                                                ----------   ----------
         Total current assets                                      243,343      217,168
                                                                ----------   ----------
Regulatory assets:
   Deferred income taxes                                            25,611       28,052
   Other                                                            20,933       25,208
                                                                ----------   ----------
         Total regulatory assets                                    46,544       53,260
                                                                ----------   ----------
Total Assets                                                    $1,789,315   $1,788,707
                                                                ==========   ==========

CAPITAL AND LIABILITIES
Capitalization:
   Common stock, no par value, authorized 45,000,000 shares -
     outstanding 25,452,373 shares                              $  120,033   $  121,282
   Retained earnings                                               466,284      451,477
                                                                ----------   ----------
         Total common stockholders' equity                         586,317      572,759
   Preferred stock not subject to mandatory redemption              80,000       80,000
   Long-term debt                                                  507,635      558,474
                                                                ----------   ----------
         Total capitalization                                    1,173,952    1,211,233
                                                                ----------   ----------

Current liabilities:
   Current maturity of long-term debt                               60,000        9,000
   Short-term debt                                                  53,800       64,966
   Accounts and wages payable                                       75,772       89,362
   Accumulated deferred income taxes                                21,065       20,285
   Taxes accrued                                                    25,055       15,869
   Other                                                            35,591       21,937
                                                                ----------   ----------
         Total current liabilities                                 271,283      221,419
                                                                ----------   ----------
Accumulated deferred income taxes                                  234,230      237,629
Accumulated deferred investment tax credits                         35,796       40,369
Regulatory liability                                                41,014       48,587
Other deferred credits and liabilities                              33,040       29,470
                                                                ----------   ----------
Total Capital and Liabilities                                   $1,789,315   $1,788,707
                                                                ==========   ==========
</TABLE>
                                      -8-

<PAGE>

<TABLE>
<CAPTION>

                     CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
                               STATEMENT OF INCOME
                                    UNAUDITED
                             (Thousands of Dollars)


                                              Three Months Ended        Nine Months Ended       Twelve Months Ended
                                                September 30,             September 30,            September 30,         
                                              1998         1997         1998         1997         1998        1997
                                              ----         ----         ----         ----         ----        ----

<S>                                       <C>          <C>          <C>          <C>          <C>         <C>
 OPERATING REVENUES:
    Electric                               $ 230,422    $ 208,495    $ 568,866    $ 534,691    $ 734,692   $ 704,009
    Gas                                       16,253       15,750       92,153      101,177      142,534     155,246
                                           ---------    ---------    ---------    ---------    ---------   ---------
 Total operating revenues                    246,675      224,245      661,019      635,868      877,226     859,255

 OPERATING EXPENSES:
    Operations
       Fuel and purchased power               66,965       62,192      183,143      178,636      246,763     247,829
       Gas                                     6,517        7,947       53,372       62,941       87,657      98,942
       Other                                  51,941       42,792      134,092      120,222      174,071     159,014
                                           ---------    ---------    ---------    ---------    ---------   ---------
                                             125,423      112,931      370,607      361,799      508,491     505,785
    Maintenance                               16,232       15,795       50,153       48,056       77,749      66,512
    Depreciation and amortization             17,357       19,607       54,791       62,247       75,233      83,405
    Income taxes                              24,484       18,342       40,113       32,804       40,970      37,472
    Other taxes                               12,556       14,647       44,571       43,798       58,668      58,105
                                           ---------    ---------    ---------    ---------    ---------   ---------
       Total operating expenses              196,052      181,322      560,235      548,704      761,111     751,279

 OPERATING INCOME                             50,623       42,923      100,784       87,164      116,115     107,976

 OTHER INCOME AND DEDUCTIONS:
    Allowance for equity funds used
       during construction                        (4)         237           45          381          447         563
    Miscellaneous, net                          (834)        (123)        (545)        (632)      (3,713)     (1,339)
                                           ---------    ---------    ---------    ---------    ---------   ---------

       Total other income and deductions        (838)         114         (500)        (251)      (3,266)       (776)

 INCOME BEFORE
    INTEREST CHARGES                          49,785       43,037      100,284       86,913      112,849     107,200

 INTEREST CHARGES:
    Interest                                  10,423       10,583       30,126       28,445       38,472      38,319
    Allowance for borrowed funds
       used during construction                 (310)        (302)        (981)        (484)      (1,283)       (717)
                                           ---------    ---------    ---------    ---------    ---------   ---------
       Net interest charges                   10,113       10,281       29,145       27,961       37,189      37,602

 INCOME BEFORE
    EXTRAORDINARY CHARGE                      39,672       32,756       71,139       58,952       75,660      69,598
                                           ---------    ---------    ---------    ---------    ---------   ---------

 EXTRAORDINARY CHARGE
   (NET OF INCOME TAXES)                        --           --           --           --        (24,853)       --   
                                           ---------    ---------    ---------    ---------    ---------   ---------

NET INCOME                                    39,672       32,756       71,139       58,952       50,807      69,598

PREFERRED STOCK DIVIDENDS                        936          940        2,801        2,782        3,734       3,708
                                           ---------    ---------    ---------    ---------    ---------   ---------

INCOME AFTER PREFERRED
   STOCK DIVIDENDS                         $  38,736    $  31,816    $  68,338    $  56,170    $  47,073   $  65,890
                                           =========    =========    =========    =========    =========   =========
</TABLE>


                                      -9-
<PAGE>


<TABLE>
<CAPTION>


                     CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
                             STATEMENT OF CASH FLOWS
                                    UNAUDITED
                             (Thousands of Dollars)




                                                          Nine Months Ended
                                                             September 30,      
                                                           1998         1997
                                                           ----         ----

<S>                                                   <C>          <C>
Cash Flows From Operating:
   Net income                                          $  71,139    $  58,952
   Adjustments to reconcile net income to net cash
      provided by operating activities:
        Depreciation and amortization                     54,791       62,247
        Allowance for funds used during construction      (1,026)        (865)
        Deferred income taxes, net                        (9,760)        (850)
        Deferred investment tax credits, net              (4,573)      (2,501)
        Changes in assets and liabilities:
           Temporary investments                          22,100         (581)
           Receivables, net                              (36,417)       8,529
           Materials and supplies                         (6,942)       4,573
           Regulatory assets - other                       4,275      (63,083)
           Accounts and wages payable                    (13,590)     (21,895)
           Taxes accrued                                   9,186        9,085
           Other, net                                     30,888        4,922
                                                       ---------    ---------
Net cash provided by operating activities                120,071       58,533

Cash Flows From Investing:
   Construction expenditures                             (46,911)     (79,835)
   Allowance for funds used during construction            1,026          865
                                                       ---------    ---------
Net cash used in investing activities                    (45,885)     (78,970)

Cash Flows From Financing:
   Dividends on common stock                             (53,297)     (43,300)
   Dividends on preferred stock                           (3,035)      (2,782)
   Redemptions -
      Short-term debt                                    (11,166)     (24,210)
      Long-term debt                                     (10,000)     (61,000)
   Issuances -
      Long-term debt                                      10,000      152,000
                                                       ---------    ---------
Net cash provided by (used in) financing activities      (67,498)      20,708

Net increase in cash and cash equivalents                  6,688          271
Cash and cash equivalents at beginning of year             6,040        2,261
                                                       ---------    ---------
Cash and cash equivalents at end of period             $  12,728    $   2,532
                                                       =========    =========

Cash paid during the periods:
   Interest (net of amount capitalized)                $  29,650    $  24,814
   Income taxes, net                                   $  37,940    $  24,659

</TABLE>

                                      -10-

<PAGE>



CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
September  30, 1998


Note 1 - Effective  December  31,  1997,  following  the receipt of all required
state and federal  regulatory  approvals,  Union Electric Company (AmerenUE) and
CIPSCO Incorporated  (CIPSCO) combined to form Ameren Corporation  (Ameren) (the
Merger).

Note 2 - Financial  statement note  disclosures,  normally included in financial
statements prepared in conformity with generally accepted accounting principles,
have been omitted in this Form 10-Q pursuant to the Rules and Regulations of the
Securities and Exchange  Commission.  However, in the opinion of the Registrant,
the disclosures contained in this Form 10-Q are adequate to make the information
presented not misleading. See Notes to Financial Statements included in the 1997
Form 10-K for information relevant to the financial statements contained in this
Form 10-Q,  including  information as to the significant  accounting policies of
the Registrant.

Note 3 - In the opinion of the Registrant the interim financial statements filed
as part of this Form 10-Q  reflect all  adjustments,  consisting  only of normal
recurring  adjustments,  necessary  for a fair  statement of the results for the
periods presented. The Registrant's financial statements were prepared to permit
the information required in the Financial Data Schedule (FDS), Exhibit 27, to be
directly  extracted from the filed statements.  The FDS amounts correspond to or
are calculable  from the amounts  reported in the financial  statements or notes
thereto.

Note 4 - Due to the  effect of  weather  on sales and  other  factors  which are
characteristic of public utility  operations,  financial results for the periods
ended September 30, 1998 and 1997 are not  necessarily  indicative of trends for
any three-month, nine-month or 12-month period.

Note 5 - On March 27, 1998, a jury awarded a total of $3 million to the families
of four children who contracted  neuroblastoma (a rare form of cancer) following
the  Registrant's  1987  clean-up  of a former  manufactured  gas plant  site in
Taylorville,  Illinois.  The Registrant  continues to believe it has meritorious
defenses and has appealed the verdict.  The  Registrant  believes that the final
disposition  of this  matter  will not have a  material  adverse  effect  on its
financial position, results of operations or liquidity.

Note 6 -  Effective  August  1,  1998,  the  Registrant's  residential  electric
customers  received a five percent rate reduction  provided by Illinois electric
utility industry restructuring  legislation.  This rate reduction is expected to
reduce  electric  revenues  approximately  $5  million  in 1998 and $11  million
annually thereafter, based on estimated sales levels and assuming normal weather
conditions.

Note 7 - In July 1998,  Ameren offered  separation  packages to employees  whose
positions were eliminated  through a targeted  separation plan. During the third
quarter of 1998,  a one-time  pretax  charge of $7 million was  recorded,  which
reduced  earnings  $4  million,  representing  the  Registrant's  share of costs
incurred to implement the targeted separation plan.

Note 8 - Statement of Financial  Accounting Standards (SFAS) No. 130, "Reporting
Comprehensive  Income"  became  effective on January 1, 1998.  SFAS 130 requires
that all items that are required to be recognized under accounting  standards as
components of comprehensive  income be reported in the financial statements with
the same prominence as other financial  statement  components.  Adoption of SFAS
130 did not  have a  material  effect  on the  financial  position,  results  of
operations,   liquidity  or  presentation   of  financial   information  of  the
Registrant.

Note 9 - Certain  reclassifications were made to prior-year financial statements
to conform to current-period presentation.

                                      -11-

<PAGE>


                           PART II. OTHER INFORMATION


ITEM 1.  LEGAL PROCEEDINGS
         -----------------

         Reference  is made to Note 8 -  Commitments  and  Contingencies  in the
Notes to Financial  Statements of the Registrant's  Form 10-K for the year ended
December 31, 1997 for information  regarding unfair labor practice charges filed
with the National Labor  Relations  Board (NLRB) by the  International  Union of
Operating  Engineers Local 148 and the  International  Brotherhood of Electrical
Workers  Local 702  relating  to the  lockout by the  Registrant  of both unions
during  1993.  On August 27,  1998,  a three  member  panel of the NLRB issued a
decision  favorable to the  Registrant.  It is anticipated  that the unions will
file motions for reconsideration of the decision with the NLRB.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K
         --------------------------------

         (a)   Exhibits.

               Exhibit 3(ii)-By-Laws of Central Illinois Public Service Company,
               as amended as of August 24, 1998.

               Exhibit 12 -  Computation  of Ratio of Earnings to Fixed  Charges
               and  Preferred  Stock  Dividend  Requirements,  12  Months  Ended
               September 30, 1998.

               Exhibit 27 - Financial Data Schedule.

         (b)  Reports  on Form 8-K.  The  Registrant  filed a report on Form 8-K
dated September 24, 1998 reporting on the impact of Ameren Corporation's (parent
company of the  Registrant)  employee  separation plan  and on the effect of the
final  rule  issued  in  September  1998  by  the  United  States  Environmental
Protection Agency pertaining to nitrogen oxide emissions.



                                   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.

                                              CENTRAL ILLINOIS PUBLIC
                                                   SERVICE COMPANY
                                                     (Registrant)


                                             By     /s/ Warner L. Baxter
                                                 -------------------------
                                                        Warner L. Baxter
                                                          Controller


Date: November 13, 1998

                                      -12-