U. S. SECURITIES AND EXCHANGE COMMISSION
                         WASHINGTON, D.C. 20549
                              FORM 10-QSB/A

(Mark One)
[X]   QUARTERLY   REPORT   PURSUANT  TO  SECTION  13  OR  15(d)  OF  THE
      SECURITIES EXCHANGE ACT OF 1934
      For the quarterly period ended SEPTEMBER 30, 1997

[  ]  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 0-14937

                        PMC INTERNATIONAL, INC.
   (Exact name of small business issuer as specified in its charter)

                    COLORADO                   84-0627374
        (State or other jurisdiction of       (IRS Employer
         incorporation or organization)    Identification No.)

          555 17th Street, 14th Floor, Denver, Colorado 80202
                (Address of principal executive offices)

                             (303) 292-1177
                      (Issuer's telephone number)

                             Not Applicable
 (Former name, former address and former fiscal year, if changed since
                              last report)

Check  whether the issuer (1) filed all  reports  required to be filed by
Section  13 or 15(d) of the  Exchange  Act  during the past 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  .

State the number of shares  outstanding of each of the issuer's  classes
of common equity,
as of November 10, 1997.

       Common Stock $0.01 Par Value                 19,431,610
                  Class                          Number of Shares

Transitional Small Business Disclosure Format
Yes        No   X  
                              Page 1 of 17
<PAGE>
                 
PMC  International,  Inc. (the "Company or the  "Registrant")  hereby 
amends its Quarterly Report on Form 10-QSB,  for the quarterly period ended
September  30,  1997,  by deleting it  responses  to Part I, Item 1 and 
Part I, Item 2,  contained  in its  original  filing and replacing such 
sections with the following:

                              Page 2 of 17

<PAGE>
                 PMC INTERNATIONAL, INC. AND SUBSIDIARIES

PART I.  FINANCIAL INFORMATION

ITEM 1   FINANCIAL STATEMENTS (Note 1)

                      PMC INTERNATIONAL, INC. AND SUBSIDIARIES
                       CONDENSED CONSOLIDATED BALANCE SHEETS

                                       ASSETS

                                                  (Unaudited)
                                                 September 30,      December 31,
                                                      1997              1996
                                                      ----              ----

 CASH AND CASH EQUIVALENTS (Note 2)            $   3,465,269      $   6,499,390
 RECEIVABLES
    Investment management fees, net                1,330,769            145,714
      of allowance of $250,000 (Note 1) 
   Other receivables                                 124,141            160,483

FURNITURE AND EQUIPMENT, at cost,
   net of accumulated depreciation of
   $1,600,779 and $689,227 (Note 1)                1,389,662            936,234

PRODUCT DEVELOPMENT, at cost,
   net of accumulated amortization of
   $411,524 and $203,526 (Note 1)                  1,101,042            511,123

GOODWILL, net of amortization of $10,498           5,400,076                  -
   (Note 1)

PREPAID EXPENSES AND OTHER ASSETS                  1,428,493            340,006

LONG TERM NOTE RECEIVABLE (Note 2)                   545,811            570,494
                                                ------------       ------------
   TOTAL ASSETS                                   14,785,263          9,163,444
                                                ============       ============




See notes to unaudited condensed consolidated financial statements
                              Page 3 of 17


<PAGE>

                       PMC INTERNATIONAL, INC. AND SUBSIDIARIES
                        LIABILITIES AND SHAREHOLDERS' EQUITY

                                                  (Unaudited)
                                                 September 30,      December 31,
                                                      1997              1996
                                                      ----              ----
LIABILITIES
   Accounts payable                            $   1,197,151        $   839,095
   Accrued expenses                                  612,386            535,520
   Other liabilities                                 136,948            730,909
   Deferred revenue                                1,391,999            552,868
   Notes payable - (Note 3)                          368,423             14,694
   Obligations under capital lease                   382,655            103,119
   Income tax payable                                  2,152                  -
                                                ------------       ------------

   TOTAL LIABILITIES                               4,091,714          2,892,907
                                                ------------       ------------

COMMITMENTS AND CONTINGENCIES

SHAREHOLDERS' EQUITY (Note 4)
   Preferred stock, no par value - authorized
      5,000,000 shares; issued and outstanding,
      138,182 shares and 175,897 shares              345,455            439,742
   Common stock, $.01 par value - authorized
      50,000,000 shares; issued and outstanding,
      19,431,610 shares and 14,471,756 shares        415,475            365,876
   Additional paid-in capital                     22,682,339         16,132,256
   Accumulated deficit                           (12,749,720)       (10,667,337)
                                                ------------       ------------

      TOTAL SHAREHOLDERS' EQUITY                  10,693,549          6,270,537
                                                ------------       ------------

TOTAL LIABILITIES AND
   SHAREHOLDERS' EQUITY                           14,785,263          9,163,444
                                                ============       ============




See notes to unaudited condensed consolidated financial statements
                              Page 4 of 17
<PAGE>
<TABLE>
                      PMC INTERNATIONAL, INC. AND SUBSIDIARIES
                    CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                                    (Unaudited)
<CAPTION>
                                          Three Months Ended             Nine Months Ended
                                             September 30,                 September 30,
REVENUE
<S>                                 <C>            <C>            <C>            <C> 
                                           1997           1996           1997           1996
                                           ----           ----           ----           ----

   Investment management fees       $   3,382,199  $   2,401,602  $   9,001,181  $   7,322,124
   Other income                            72,168         81,605        304,392        370,293
                                     ------------   ------------   ------------   ------------

      Total revenue                     3,454,367      2,483,207      9,305,573      7,692,417
                                     ------------   ------------   ------------   ------------

EXPENSES

   Investment manager and other fees    1,702,820      1,392,901      4,437,494      4,225,107
                                     ------------   ------------   ------------   ------------

NET                                 $   1,751,547  $   1,090,306  $   4,868,079  $   3,467,310
                                     ------------   ------------   ------------   ------------

OPERATING EXPENSES
   Salaries and benefits                  888,843        794,905      3,027,800      2,309,941
   Clearing charges and user fees         160,453        201,175        438,107        630,555
   Advertising and promotion              245,014        195,059        661,743        525,436
   General and administrative             296,989        214,686        882,038        593,093
   Product development costs               60,597         36,036        146,279         76,916
   Occupancy costs                         97,654         66,822        247,140        209,922
   Equipment costs                        134,368         76,180        282,135        227,126
   Professional fees                       10,744        190,181        311,452        399,620
   Provision for bad debts                250,000              -        250,000              -
   Interest                                 9,895        115,941         26,019        232,528
   Depreciation and amortization          313,251        130,500        623,751        376,000
   Goodwill amortization                   10,498              -         10,498              -
   Severance pay                           43,500              -         43,500              -
                                     ------------   ------------   ------------   ------------

      Total operating expense           2,521,806      2,021,485      6,950,462      5,581,137

NET LOSS BEFORE
INCOME TAXES                        $    (770,259)  $   (931,179)  $ (2,082,383) $  (2,113,827)

INCOME TAXES                                    -              -              -              -
                                     ------------   ------------   ------------   ------------
 
NET LOSS                            $    (770,259)  $   (931,179)  $ (2,082,383) $  (2,113,827)
                                     ============   ============   ============   ============

NET LOSS PER COMMON SHARE           $       (0.05)  $      (0.18)  $      (0.15) $       (0.40)

WEIGHTED AVERAGE NUMBER OF
   COMMON SHARES
   OUTSTANDING                         14,867,070      5,555,713     14,639,096      5,555,713
                                     ============   ============   ============   ============

<FN>
See notes to unaudited condensed consolidated financial statements
</FN>
</TABLE>
                              Page 5 of 17
<PAGE>
                      PMC INTERNATIONAL, INC. AND SUBSIDIARIES
                  CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                    (Unaudited)

                                                         Nine Months Ended
                                                           September 30,
                                                      1997               1996
                                                      ----               ----

CASH FLOWS FROM OPERATING ACTIVITIES
   Net loss                                   $   (2,082,383)    $   (2,113,827)
   Adjustments to reconcile net loss to
      net cash used in operating activities
   Accretion of discount on notes receivable         (43,777)           (52,507)
   Depreciation and amortization                     634,249            376,000
   Changes in operating assets and liabilities
      Investment management
        fees receivable                           (1,185,055)            74,174
      Other receivables                               36,342            (51,650)
      Prepaid expenses and other assets           (1,088,487)          (201,308)
      Accounts payable                               358,056           (484,344)
      Accrued expenses                                76,866             83,209
      Other liabilities                               11,630             10,129
      Income taxes payable                             2,152                  -
      SEC settlement distribution                   (605,591)                 -
      Deferred revenues                              839,131             99,370
                                                ------------       ------------
   Net cash used in operating activities          (3,046,867)        (2,260,754)
                                                ------------       ------------

CASH FLOWS FROM INVESTING ACTIVITIES
   Purchase of furniture & equipment                (869,180)          (479,456)
   Cost of product development                      (797,918)                 -
   Decrease of long term note receivable              68,460            300,318
   Goodwill recognized on ADAM purchase           (5,410,574)                 -
                                                ------------       ------------
   Net cash provided by (used in)
   investing activities                           (7,009,212)          (179,138)
                                                ------------       ------------

CASH FLOWS FROM FINANCING ACTIVITIES
   Net proceeds from notes payable                   353,729          2,869,227
   Increase in obligations under capital lease       162,834            (42,060)
   Net proceeds from issuance of common stock      6,505,395                  -
                                                ------------       ------------

   Net cash provided by financing activities       7,021,958          2,827,167
                                                ------------       ------------

NET INCREASE (DECREASE) IN CASH                   (3,034,121)           387,275

CASH, at beginning of period                       6,499,390            313,885
                                                ------------       ------------
CASH, at end of period                         $   3,465,269        $   701,160
                                                ============       ============




See notes to unaudited condensed consolidated financial statements
                              Page 6 of 17
<PAGE>
<TABLE>
                                  PMC INTERNATIONAL, INC. AND SUBSIDIARIES
                            UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME
                               FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1997


<CAPTION>
                                                                         Pro Forma       PMCI/ADAM
                                         PMCI              ADAM         Adjustments       Combined
REVENUE
<S>                                  <C>                <C>          <C>                 <C>
  Investment management fees         $3,169,117        $2,795,019     $       -          $5,964,136
  Other income                           68,787            36,161             -             104,948
                                      ---------         ---------      --------           ---------
        Total revenue                 3,237,904         2,831,180             -           6,069,084
                                      ---------         ---------      --------           ---------

DIRECT EXPENSES

  Investment manager and other fees   1,552,986         1,966,063             -           3,519,049
                                      ---------         ---------      --------           ---------

GROSS PROFIT MARGIN                  $1,684,918        $  865,117     $       -          $2,550,035
                                      ---------         ---------      --------           ---------

OPERATING EXPENSES
  Salaries and benefits                 845,212           623,503             -           1,468,715
  Clearing charges and user fees        160,453                 -             -             160,453
  Advertising and promotion             238,546           124,896             -             363,442
  General and administrative            291,814            37,382             -             329,196
  Product development costs              60,597                 -             -              60,597
  Occupancy and equipment costs         219,072           160,766             -             379,838
  Professional fees                       7,435            59,725             -              67,160
  Provision for bad debts               250,000                 -             -             250,000
  Interest                                9,405             6,300             -              15,705
  Depreciation and amortization         311,908            17,613             -             329,521
  Goodwill amortization - Optima              -            13,525       (13,525)                  -
  Goodwill amortization - ADAM                -                 -       134,146 (1)         134,146
  Severance pay                          43,500                 -             -              43,500
                                      ---------         ---------      --------           ---------
      Total operating expense         2,437,942         1,043,710       120,621           3,602,273

NET LOSS BEFORE INCOME TAXES         $ (753,024)       $ (178,593)    $(120,621)       $ (1,052,238)
                                      =========         =========      ========           =========

NET LOSS PER COMMON SHARE                $(0.05)       $  (231.04)                           $(0.06)

WEIGHTED AVERAGE NUMBER OF
  COMMON SHARES OUTSTANDING          14,548,614               773                        19,431,610
                                      ---------         ---------                         ---------
---------
<FN>
(1) The adjustment of $134,146 reflects three months of amortization cost of the
    ADAM goodwill ($5,365,825 amortized over 120 months).
</FN>
</TABLE>
                              Page 7 of 17
<PAGE>
<TABLE>
                                  PMC INTERNATIONAL, INC. AND SUBSIDIARIES
                            UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME
                               FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1996
<CAPTION>
                                                                         Pro Forma        PMCI/ADAM
                                         PMCI              ADAM         Adjustments      Combined
REVENUE
<S>                                  <C>                <C>          <C>                 <C>
  Investment management fees         $2,401,602        $3,872,240     $       -          $6,273,842
  Other income                           81,605            47,938             -             129,543
                                      ---------         ---------      --------           ---------

      Total revenue                   2,483,207         3,920,178             -           6,403,385
                                      ---------         ---------      --------           ---------
    
DIRECT EXPENSES

  Investment manager and other fees   1,392,901         2,849,746             -           4,242,647
                                      ---------         ---------      --------           ---------

GROSS PROFIT MARGIN                  $1,090,306        $1,070,432     $       -          $2,160,738
                                      ---------         ---------      --------           ---------

OPERATING EXPENSES
  Salaries and benefits                 794,905           618,596             -           1,413,501
  Clearing charges and user fees        201,175                 -             -             201,175
  Advertising and promotion             195,059            56,447             -             251,506
  General and administrative            214,686            93,388             -             308,074
  Product development costs              36,036                 -             -              36,036
  Occupancy and equipment costs         143,002           132,774             -             275,776
  Professional fees                     190,181           103,549             -             293,730
  Provision for bad debts                     -                 -             -                   -
  Interest                              115,941            13,068             -             129,009
  Depreciation and amortization         130,500            20,400             -             150,900
  Goodwill amortization - Optima              -            13,467       (13,467)                  -
  Goodwill amortization - ADAM                -                 -       123,782 (1)         123,782
  Severance pay                               -                 -             -                   -
                                      ---------         ---------      --------           ---------
      Total operating expense         2,021,485         1,051,689       110,315           3,183,489

NET LOSS BEFORE INCOME TAXES         $ (931,179)       $   18,743     $(110,315)       $ (1,022,751)
                                      =========         =========      ========           =========

NET LOSS PER COMMON SHARE                $(0.18)       $    24.25                            $(0.10)

WEIGHTED AVERAGE NUMBER OF
  COMMON SHARES OUTSTANDING           5,555,713               773                        10,438,709
                                      ---------         ---------                         ---------
-------
<FN>
(1) The adjustment of $123,782 reflects three months of amortization cost of the 
    ADAM goodwill ($4,591,275 amortized over 120 months).
</FN>
</TABLE>
                              Page 8 of 17

<PAGE>

                PMC INTERNATIONAL, INC. AND SUBSIDIARIES
 

     NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
         FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
 PMC INTERNATIONAL, INC. AND SUBSIDIARIES
 

     NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
         FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996

NOTE 1 -   ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization

On  September  24,  1997,  PMC   International,   Inc.  ("PMCI"  or  the
"Company")   completed  its  acquisition  (the  "Acquisition")  of  ADAM
Investment  Services,  Inc. ("ADAM"),  a Delaware  corporation,  and its
wholly  owned  subsidiary,  Optima  Funds,  Inc.,  ("Optima")  a Georgia
corporation,  pursuant to a Stock Purchase Agreement dated July 25, 1997
("the  Agreement")  among the  Company,  ADAM and  ADAM's  shareholders.
PMCI acquired all of the issued and  outstanding  shares of common stock
of ADAM  from  its  shareholders  in  consideration  for  payment  of $5
million at closing  and two  earn-out  payments  on the first and second
anniversary  dates of the  closing.  The  first  earn-out  payment  will
equal 1.0% of ADAM's  standard fee assets under  management in excess of
$500 million,  determined on the one-year  anniversary of the closing of
the Acquisition,  not to exceed $2.0 million, plus interest thereon at a
rate of 8.75%.  The second  earn-out  payment  will equal 1.0% of ADAM's
standard  fee  assets  under  management  in  excess  of  $700  million,
determined   on  the  two-year   anniversary   of  the  closing  of  the
Acquisition,  not to exceed $2.0 million.  The Acquisition was accounted
for using the purchase  method of accounting.  The excess of the cost of
the  Acquisition  over  the  fair  value  of  the  assets  acquired  and
liabilities  assumed  was  recorded as  goodwill.  The  Acquisition  was
funded from the  proceeds of a private  placement  of PMCI common  stock
which  also  closed  on   September   24,  1997.   The  Company   raised
approximately  $6.6 million by selling  4,882,996  shares of PMCI common
stock at $1.50 per share.

Summary of Significant Accounting Policies

Basis of Presentation

The accompanying  unaudited condensed  consolidated financial statements
include the  historical  accounts of Portfolio  Management  Consultants,
Inc. for all periods,  the  accounts of PMCI since  September  30, 1993,
the  accounts of  Portfolio  Brokerage  Services,  Inc.,  and  Portfolio
Technology Services, Inc. since inception,  and ADAM since September 24,
1997.  These financial  statements have been prepared in accordance with
generally   accepted   accounting   principles  for  interim   financial
information  and pursuant to the rules and regulations of the Securities
and  Exchange  Commission.  Accordingly,  they do not include all of the
information  and  footnotes  required by generally  accepted  accounting
principles  for  complete  financial  statements.   In  the  opinion  of
management,   all   adjustments   (consisting  of  normal  accruals  and
elimination  of  intercompany  accounts  and  transactions)   considered
necessary  for a fair  presentation  have been  included.  The unaudited
condensed  financial  statements  should be read in conjunction with the
consolidated  financial statements and footnotes thereto included in the
Company's Annual Report on Form 10-KSB,  as amended,  for the year ended
December 31, 1996, as amended.
                              Page 9 of 17
<PAGE>
                PMC INTERNATIONAL, INC. AND SUBSIDIARIES

Product Development

Product  development  costs  consist  of salary  and  benefits,  outside
services and other direct costs  relating to  customization  of products
for  institutional  client  relationships.  These costs are  capitalized
and  amortized  straight  line over the terms of the related  contracts.
During the three months ended  September  30, 1997,  $594,000 of product
development  costs were  capitalized.  These  costs are being  amortized
over periods ranging from 36 to 60 months.

Allowance for Losses on Uncollectible Accounts Receivable

General  allowances  for losses are provided  based on past  experience.
Management's  evaluation  considers various factors  including,  but not
limited  to,  the  ability to  collect  all  amounts  due  according  to
contract terms.  Specific  allowances for losses are established  when a
significant and permanent contingency exists or is likely to occur.


NOTE 2 -   LONG TERM NOTE RECEIVABLE

In January 1997, KP3, LLC ("KP3") a limited  liability company owned and
controlled  by the  Company's  president  and chief  executive  officer,
borrowed  $1,750,000  from a bank with a due date of December  31, 1997.
The purpose of the loan was to finance  payment of the deferred  portion
of the purchase price of 1,643,845  shares of the Company's common stock
owned by KP3 that were  purchased  from a former  officer of the Company
at the time of his departure.  In connection  with this  borrowing,  the
Company   agreed   to   collateralize   the  loan  on   behalf  of  KP3.
Accordingly,  $1,890,000 of cash  included in cash and cash  equivalents
(representing  the  initial  principal  balance  plus  interest)  became
restricted  for this  purpose.  During 1997,  the Company has loaned KP3
approximately  $96,000  specifically  designated  to pay the interest on
the bank loan.  KP3 has agreed to reimburse  the Company for all amounts
paid by the  Company  toward the loan or for  collateral  applied to the
loan,  including  interest  at an annual  rate of 9% and has granted the
Company a security  interest in its  1,643,845  shares of the  Company's
common stock.  Such loan was  restructured  through a different  bank on
October 1, 1997. In connection  therewith,  the collateral pledge by the
Company in connection  with the loan was reduced to  $1,400,000  and the
Company  released  350,000  shares of the  common  stock in the  Company
which it held as collateral.  The new loan is due December 31, 1998.

During January 1997, the Company authorized  collateralized financing of
154,690  shares of the Company's  common stock which had been  purchased
and owned by a number  of PMC  employees  as part of a  private  sale of
stock by a  shareholder  of the  Company  in  1993.  This  purchase  was
originally  financed  through a bank loan which came due on December 31,
1996.  The  balloon  amount  due  at the  expiration  of  the  loan  was
$142,093.  The Company is receiving  monthly  installments in the amount
of  $3,435  collected  through  payroll  deductions.  These  notes  will
mature on December 31, 1999,  with balloon  payments of $38,826 due from
employees.

                              Page 10 of 17
<PAGE>
                PMC INTERNATIONAL, INC. AND SUBSIDIARIES

NOTE 3 - NOTES PAYABLE

Note payable to a former stockholder of ADAM consists  of $360,000 of
which $160,000 is current and $200,000 is long term.  The note requires
annual principal and interest payments and bears interest at the rate
of 5% per annum and matures February 9, 1999.

NOTE 4  - SHAREHOLDERS' EQUITY

Common Stock/Preferred Stock

On September 24, 1997,  the Company  raised  approximately  $6.6 million
(net  of  approximately   $700,000  in  offering  expenses)  by  selling
4,882,996 shares of PMCI common stock at $1.50 per share.

During January 1997, certain shareholders  voluntarily  exchanged 37,715
shares of the  Company's  Series A Preferred  Stock and all  accumulated
dividends  thereon for 51,858 shares of common  stock.  At September 30,
1997,  there were 138,182  shares of  preferred  stock  outstanding  and
cumulative dividends in arrears thereon of $275,964.

Options

On  February  26,  1997,  the  Board of  Directors  granted  options  to
purchase  a total of 70,000  shares  of the  Company's  common  stock to
employees  at an exercise  price of $2.50 per share and which  expire in
six  years.  The  options  vest  20% on the  first  anniversary  of each
employees  date of hire with the  balance  vesting  in equal  successive
quarterly   installments  over  the  following  four  years,   provided,
however,  each  employee must be employed by the Company at the time any
vesting  would  occur.  The Board of Directors  also granted  options to
purchase  50,000 shares of common stock to Mr. Emmett Daly in connection
with his  appointment  as a  director  of the  Company on  February  27,
1997.  The  options  vest at the  rate of 20% at each  such  time as the
average of the bid and asked  price of the common  stock  equals  $2.50,
$3.50, $4.50, $5.50 and $6.50  respectively,  for 20 consecutive trading
days. Mr. Daly's  options are  exercisable at $2.50 per share and expire
in five years.

The Board of  Directors  granted  options to purchase  50,000  shares of
common stock to Mr. Richard C. Hyde in connection  with his  appointment
as a director  of the Company on July 9, 1997.  The options  vest at the
rate of 20% at each such time as the  average of the bid and asked price
of the common stock equals $1.968,  $2.968,  $3.968, $4.968, and $5.968,
respectively,  for 20  consecutive  trading days. Mr. Hyde's options are
exercisable at $1.968 per share and expire in five years.

The Board of Directors  granted  options to purchase  250,000  shares of
common stock to Mr.  Scott  MacKillop  and a total of 165,000  shares of
common stock to a total of 6 other  employees of ADAM in connection with
the  Acquisition.  The options vest as follows:  20% of each  employee's
options vest on the first  anniversary  of the Company's  Acquisition of
ADAM and the balance in equal  successive  quarterly  installments  over
the following  four year period,  provided,  however,  that the employee
must me employed or engaged by PMCI or one of its  affiliates a s either
an  employee or  consultant  on the date any vesting  would  occur.  The
exercise  price of options  are $1.625 per common  share and the options
expire six years from the date of grant unless  employment or engagement
is  terminated  prior to that time,  which case the options shall expire
90 days after termination.
Page 11 of 17
<PAGE>
                PMC INTERNATIONAL, INC. AND SUBSIDIARIES

NOTE 4  - SHAREHOLDERS' EQUITY  (cont'd)
The Board also  granted  options  to  purchase  50,000  shares of common
stock to Mr. Scott  MacKillop in connection  with his  appointment  as a
director  of the Company on October 27,  1997.  The options  vest at the
rate of 20% at each such time as the  average of the bid and asked price
of the common stock  equals  $1.625,  $2.625,  $3.625,  $4.625,  $5.625,
respectively,  for 20 consecutive  trading days. Mr. MacKillop's options
are exercisable at $1.625 per share and expire in five years.

In May 1997, a total of 25,000 stock options were  exercised to purchase
25,000  shares of common stock at the exercise  price of $1.00 per share
on 20,000 options and $1.375 per share on 5,000 options.
                            Page 12 of 17
<PAGE>
                PMC INTERNATIONAL, INC. AND SUBSIDIARIES

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

General

PMC International,  Inc., together with its subsidiaries  ("PMCI" or the
"Company")  develops,  markets,  and  manages  sophisticated  investment
management  products  and  services.  Not a money  manager  itself,  the
Company's   products  and  services   facilitate  the  selection  and/or
monitoring of unaffiliated  money managers or mutual funds for customers
of  the  Company's   distribution  channels  depending  upon  the  size,
sophistication   and   requirements  of  the  investor.   The  Company's
products   and   services    address    investment    suitability    and
diversification,  asset allocation  recommendations,  portfolio modeling
and  rebalancing,  comprehensive  accounting  and portfolio  performance
reporting.  The  Company's  revenues  are realized  primarily  from fees
charged  to clients  based on a  percentage  of managed  assets and to a
lesser  extent on  consulting  fees for certain  advisory  services  and
licensing  fees from its software  products.  At the present  time,  the
principal  factors  affecting  the  Company's  revenues  are whether the
Company adds or loses customers for its investment  management services,
the  performance  of equity and fixed income  markets,  and the type and
size of accounts managed by the Company and related  differences in fees
charged.

The following  discussion relates to the Company's financial  statements
included in this  Quarterly  Report on Form 10-QSB for the quarter ended
September 30, 1997.  This report should be read in conjunction  with the
Company's financial statements and Management's  Discussion and Analysis
of  Financial  Condition  and  Results of  Operations  contained  in the
Company's Annual Report on Form 10-KSB,  as amended,  for the year ended
December  31,  1996 (the  "10-KSB"),  and the Form 8-K dated  October 8,
1997 (the "8-K"),  as filed with the Securities and Exchange  Commission
(the   "Commission").   Statements   which  are  not  historical   facts
contained  in this Form  10-QSB  are  forward  looking  statements  that
involve  risks and  uncertainties  that could  cause  actual  results to
differ from  projected  results.  Without  limiting the  foregoing,  the
words  "believes,"  "anticipates,"  "plans,"  "expects,"  "intends," and
similar   expressions   are   intended   to   identify   forward-looking
statements.   Factors  that  could  cause   actual   results  to  differ
materially  include the addition or loss of a  substantial  customer for
the Company's  investment  management and consulting  services,  general
economic  (specifically  market) conditions,  and other factors detailed
in Forms 10-KSB, as amended, and 8-K.

ADAM Acquisition
On September 24, 1997, the Company  acquired ADAM  Investment  Services,
Inc.  ("ADAM") and its wholly owned subsidiary  Optima Funds,  Inc. (See
Note  2 to  the  Financial  Statements,  above.)  ADAM  is a  registered
investment  adviser  with  approximately  $1.2  billion in assets  under
advisement.  As the  transaction  was  completed  just six days prior to
the end of the  third  quarter,  the  impact of the  acquisition  on the
Company's  statements  of income is nominal,  but is fully  reflected in
the  September  30,  1997  balance  sheet.  Beginning  with  the  fourth
quarter,  ADAM's  operations  will be fully  reflected in the  Company's
financial statements.

                               Page 13 of 17
<PAGE>
                PMC INTERNATIONAL, INC. AND SUBSIDIARIES

Results of Operations

Three Months Ended September 30, 1997, Compared to Three Months Ended
September 30, 1996 and
Nine Months Ended September 30, 1997, Compared to Nine Months Ended
September 30, 1996

      Revenues  were  $3,454,000  for the quarter  ended  September  30,
1997,  compared to $2,483,000 for the corresponding  quarter in 1996, an
increase of 39%.  Revenues  were  $9,306,000  for the nine months  ended
September 30, 1997,  compared to $7,692,000 for the  corresponding  nine
months in 1996,  an  increase  of 21%.  The  increase  was  attributable
primarily   to   investment   management   fees   generated   from   new
institutional   client   relations.   In  addition,   asset  based  fees
increased  in  direct  proportion  to  increases  in the  stock  market.
Revenues related to these new  relationships are based upon a percentage
of assets under  management  using the Company's  products and services.
Much of the new  business  is from  distribution  channels  that pay the
Company only its net portion of the fees,  and does not include the fees
for third parties (i.e.,  portfolio managers,  solicitors,  brokerage or
custody).  Historically,  fees paid to the  Company  through its primary
distribution  channels  included fees payable for these other  services.
When  the  Company  acts  in  the  capacity  of  vendor,  consultant  or
sub-advisor  to another  entity that is either a  registered  investment
advisor or exempt  under the law,  the Company is likely to be paid only
its  portion  of the total  client  fee.  When the  Company  acts in the
capacity of investment  advisor,  it is more likely to collect the gross
fee paid by the client and then pay  investment  manager and other third
party fees.

      Expenses  Investment  manager  and  other  third  party  fees were
$1,703,000  for the  quarter  ended  September  30,  1997,  compared  to
$1,393,000  for the  corresponding  quarter in 1996, an increase of 22%.
Investment  manager and other third party fees were  $4,437,000  for the
nine months ended  September 30, 1997,  compared to  $4,225,000  for the
corresponding  nine months in 1996, an increase of 5%.  Direct  expenses
increased  as a  result  of  new  business  and  the  need  to  allocate
additional   resources  to  service  such  new  business.   However,  as
discussed  above,  direct  expenses  did not increase in  proportion  to
revenues as certain of these  revenues are  recognized on a net basis to
the Company.  In  addition,  asset based  direct  expenses  increased in
direct proportion to increases in the stock market.

      Net Revenue  after Investment Manager and Other Fees was  $1,752,000
for the quarter  ended  September  30,  1997,  compared  to  $1,090,000  
for the corresponding  quarter in 1996,  an  increase  of 61%.  Net Revenue was
$4,868,000  for the nine months ended  September  30, 1997,  compared to
$3,467,000  for the  corresponding  quarter in 1996, an increase of 40%.
These   increases  are  explained   above  under   Revenues  and  Direct
Expenses.

      Operating   Expenses  were   $2,522,000   for  the  quarter  ended
September  30,  1997,  compared  to  $2,021,000  for  the  corresponding
quarter  in  1996,   an  increase  of  25%.   Operating   expenses  were
$6,950,000  for the nine months ended  September  30, 1997,  compared to
$5,581,000  for the  corresponding  nine months in 1996,  an increase of
25%.  These  increases were due primarily to an increase in salaries and
benefits which increased 31% for the nine month period,  and general and
administrative  costs  which  increased  49% for the nine month  period.
Personnel  and the  related  operating  costs  increased  to support the
expansion of the Company's  products and services,  the  development  of
internal systems and the servicing of several new distribution  channels
and customers.

                              Page 14 of 17
<PAGE>

                PMC INTERNATIONAL, INC. AND SUBSIDIARIES

Also,  the  Company  established  a reserve of  $250,000  for  potential
losses resulting from uncollectible  accounts receivable.  Management of
the  Company  determined  that a reserve  should be  established  in the
third  quarter on revenue  recognized  from new  business  relationships
entered into during 1997.

The total  number of Company  employees  at  September  30,  1997 was 84
including  employees  transferred  from  ADAM,  as  compared  to  50  at
September  30,  1996.  Clearing  charges and user fees  decreased by 30%
for the nine  month  period as a result of the  implementation  of a new
in-house  trading  system and  termination  of outside  service  bureau.
Advertising and promotion  increased by 26% for the nine month period as
a result  of  development  and  support  of new  distribution  channels.
Product  development costs increased by 90% for the nine month period as
a result of  implementation  on a new  portfolio  accounting  system and
maintenance of proprietary  software.  Interest costs for the nine month
period  decreased  by  89%  as a  result  of  the  repayment  of a  note
payable.  Depreciation  and  amortization  increased by 66% for the nine
month  period as a result of a  general  increase  in the level of fixed
assets.  The Company believes  continued  expansion of its operations is
essential.  As  a  consequence,  the  Company  intends  to  continue  to
increase operating expenditures.

      Income  Taxes Based on current  estimates  of  operating  results,
the Company expects its effective tax rate to be -0- for 1997.

      Net Loss The  Company  recorded  a net  loss of  $770,000  for the
quarter  ended  September  30, 1997 as compared to $931,000 for the same
period in 1996, a decrease of 17%. The net loss was  $2,082,000  for the
nine months ended  September 30, 1997,  compared to  $2,114,000  for the
corresponding  nine  months  in 1996,  a  decrease  of 2%.  The  Company
recorded a net loss of $770,000  for the  quarter  ended  September  30,
1997 as compared to $734,000  for the quarter  ended June 30,  1997,  an
increase of 5%. For the quarter ended  September 30, 1997,  the net loss
before  interest,  taxes,  provision  for  bad  debt,  depreciation  and
amortization was $187,000 as compared to $685,000 for the  corresponding
quarter in 1996, an improvement of 73%.

The  improvement  in earnings  was the result of  revenues  growing at a
faster pace than direct and operating  expenses.  Also,  certain product
development  costs  amounting to $594,000  were  capitalized  during the
quarter  ended  September  30,  1997.  (See  Note 1.) The  decisions  by
management to capitalize  certain costs directly  impact the earnings of
the Company.
                              Page 15 of 17
<PAGE>
                PMC INTERNATIONAL, INC. AND SUBSIDIARIES


Liquidity and Capital Resources

At  September  30,  1997,  the  Company  had  cash  of   $3,465,000,   a
substantial  portion of which was held in  short-term  interest  bearing
accounts,  including restricted cash of $1,890,000.  (See Note 2.)

For the nine month period ended September 30, 1997:

Cash  used  in  operating  activities  was  $3,047,000.   This  was  due
primarily to a net  operating  losses  sustained.  Also,  as a result of
the ADAM acquisition,  accounts receivable,  prepaid expenses,  accounts
payable,  accrued expenses and deferred income  increased.  In addition,
accounts  receivable and deferred revenues  increased as a result of new
business.

Cash  used  in  investing  activities  was  $7,009,000.   Cash  used  in
investing  activities was the result of goodwill generated from the ADAM
acquisition  and capital  expenditures  incurred as a result of business
expansion.

Cash  provided by  financing  activities  of  $7,022,000  was  primarily
related to the private placement of common stock.

The Company  anticipates  that it will continue to experience  operating
losses until such time,  if ever,  as  investment  management  fees from
managed assets and consulting and license fees increase  sufficiently to
cover the Company's  increasing  operating  expenses.  While the Company
believes that it has  sufficient  capital  resources to meet its ongoing
funding  requirements,  until it  products  and  services  can  generate
sufficient  revenues to offset costs, there can be no assurance that the
Company's  products  and  services  will be  successful,  that they will
generate  adequate  revenue to meet the Company's  capital needs or that
the Company will become profitable in the future.
                              Page 16 of 17
<PAGE>

                PMC INTERNATIONAL, INC. AND SUBSIDIARIES

SIGNATURES

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

                                PMC INTERNATIONAL, INC.
                                REGISTRANT



Date:  December 12, 1997             /S/      Kenneth S. Phillips        
                                Kenneth S. Phillips
                                President, Chief Executive Officer



Date:  December 12, 1997            /S/      Vali Nasr             
                                Vali Nasr
                                Chief Financial Officer


                              Page 17 of 17