UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                    FORM 10-Q

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

                 For the quarterly period ended August 30, 2003
                                                ---------------

                                       OR

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

             For the transition period from __________ to __________

                         Commission file number 1-11479
                                                -------

                                  E-Z-EM, Inc.
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)

               Delaware                                     11-1999504
   -------------------------------                      ------------------
   (State or other jurisdiction of                       (I.R.S. Employer
    incorporation or organization)                      Identification No.)

   1111 Marcus Avenue, Lake Success, New York                 11042
   ------------------------------------------               ----------
    (Address of principal executive offices)                (Zip Code)

                                 (516) 333-8230
               --------------------------------------------------
               Registrant's telephone number, including area code

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

                            Yes |X|           No |_|

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act).

                            Yes |_|           No |X|

As of October 8, 2003, there were 10,261,710 shares of the issuer's common stock
outstanding.


                                      -1-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

                                      INDEX
                                      -----

Part 1: Financial Information                                              Page
-----------------------------                                              ----

    Item 1. Financial Statements

       Consolidated Balance Sheets - August 30, 2003 and
         May 31, 2003                                                      3 - 4

       Consolidated Statements of Operations - thirteen weeks
         ended August 30, 2003 and August 31, 2002                             5

       Consolidated Statement of Stockholders' Equity and
         Comprehensive Loss - thirteen weeks ended
         August 30, 2003                                                       6

       Consolidated Statements of Cash Flows - thirteen weeks
         ended August 30, 2003 and August 31, 2002                         7 - 8

       Notes to Consolidated Financial Statements                         9 - 16

    Item 2. Management's Discussion and Analysis of Financial
               Condition and Results of Operations                       17 - 25

    Item 3. Quantitative and Qualitative Disclosures About
               Market Risk                                               25 - 26

    Item 4. Controls and Procedures                                      26 - 27

Part II: Other Information
--------------------------

    Item 1. Legal Proceedings                                                 28

    Item 2. Changes in Securities and Use of Proceeds                         28

    Item 3. Defaults Upon Senior Securities                                   28

    Item 4. Submission of Matters to a Vote of Security Holders               28

    Item 5. Other Information                                                 28

    Item 6. Exhibits and Reports on Form 8-K                                  28


                                      -2-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

                           CONSOLIDATED BALANCE SHEETS
                                 (in thousands)

                                                       August 30,       May 31,
              ASSETS                                     2003             2003
                                                      -----------      ---------
                                                      (unaudited)      (audited)

CURRENT ASSETS
    Cash and cash equivalents                           $ 10,908       $  9,459
    Restricted cash                                          723            798
    Debt and equity securities, at fair value              5,464          8,506
    Accounts receivable, principally
        trade, net                                        20,726         23,393
    Inventories                                           28,674         28,467
    Other current assets                                   4,839          4,703
                                                        --------       --------

            Total current assets                          71,334         75,326

PROPERTY, PLANT AND EQUIPMENT - AT COST,
    less accumulated depreciation and
    amortization                                          23,209         23,457

GOODWILL, less accumulated amortization                      416            421

INTANGIBLE ASSETS, less accumulated
    amortization                                           1,239          1,302

DEBT AND EQUITY SECURITIES, at fair value                  2,554          2,171

INVESTMENTS AT COST                                        1,200          1,200

OTHER ASSETS                                               6,639          6,747
                                                        --------       --------

                                                        $106,591       $110,624
                                                        ========       ========

The accompanying notes are an integral part of these statements.


                                      -3-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

                           CONSOLIDATED BALANCE SHEETS
                 (in thousands, except share and per share data)

                                                     August 30,        May 31,
    LIABILITIES AND STOCKHOLDERS' EQUITY                2003             2003
                                                    -----------       ---------
                                                    (unaudited)       (audited)

CURRENT LIABILITIES
    Notes payable                                    $     565        $     597
    Current maturities of long-term debt                   296              302
    Accounts payable                                     5,300            6,494
    Accrued liabilities                                  6,999            7,724
    Accrued income taxes                                    90               86
                                                     ---------        ---------

            Total current liabilities                   13,250           15,203

LONG-TERM DEBT, less current maturities                  3,399            3,470

OTHER NONCURRENT LIABILITIES                             3,420            3,349
                                                     ---------        ---------

            Total liabilities                           20,069           22,022
                                                     ---------        ---------

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY
    Preferred stock, par value $.10 per
        share - authorized, 1,000,000 shares;
        issued, none
    Common stock, par value $.10 per share -
        authorized, 16,000,000 shares; issued
        and outstanding 10,232,983 shares at
        August 30, 2003 and 10,101,374 shares
        at May 31, 2003 (excluding 45,734 and
        36,834 shares held in treasury at August
        30, 2003 and May 31, 2003, respectively)         1,023            1,010
    Additional paid-in capital                          22,359           21,598
    Retained earnings                                   63,613           66,464
    Accumulated other comprehensive loss                  (473)            (470)
                                                     ---------        ---------

            Total stockholders' equity                  86,522           88,602
                                                     ---------        ---------

                                                     $ 106,591        $ 110,624
                                                     =========        =========

The accompanying notes are an integral part of these statements.


                                      -4-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (unaudited)
                      (in thousands, except per share data)

                                                        Thirteen weeks ended
                                                     ---------------------------
                                                     August 30,       August 31,
                                                        2003             2002
                                                     ----------       ----------

Net sales                                             $ 33,057         $ 30,280
Cost of goods sold                                      19,088           17,783
                                                      --------         --------

      Gross profit                                      13,969           12,497
                                                      --------         --------

Operating expenses
  Selling and administrative                            11,558           12,027
  Plant closing and operational
    restructuring costs                                    572
  Research and development                               1,804            1,589
                                                      --------         --------

    Total operating expenses                            13,934           13,616
                                                      --------         --------

      Operating profit (loss)                               35           (1,119)

Other income (expense)
  Interest income                                           52               70
  Interest expense                                        (115)             (69)
  Other, net                                                29              316
                                                      --------         --------

      Earnings (loss) before income taxes                    1             (802)

Income tax provision (benefit)                             300              (61)
                                                      --------         --------

      NET LOSS                                        $   (299)        $   (741)
                                                      ========         ========

Loss per common share
  Basic and diluted                                   $   (.03)        $   (.07)
                                                      ========         ========

Weighted average common shares
  Basic and diluted                                     10,162            9,994
                                                      ========         ========

The accompanying notes are an integral part of these statements.


                                      -5-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

      CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY AND COMPREHENSIVE LOSS

                      Thirteen weeks ended August 30, 2003
                                   (unaudited)
                        (in thousands, except share data)

<TABLE>
<CAPTION>
                                                                                         Accumulated
                                          Common stock          Additional                  other                   Compre-
                                     ----------------------      paid-in     Retained   comprehensive               hensive
                                       Shares        Amount      capital     earnings       loss        Total         loss
                                     ----------      ------     ----------   --------   -------------  -------      -------
<S>                                  <C>             <C>         <C>          <C>          <C>         <C>           <C>
Balance at May 31, 2003              10,101,374      $1,010      $21,598      $66,464      $(470)      $88,602

Exercise of stock options               140,509          14          616                                   630
Income tax benefits on
  stock options exercised                                            217                                   217
Compensation related to
  stock option plans                                                   1                                     1
Purchase of treasury stock               (8,900)         (1)         (73)                                  (74)
Net loss                                                                         (299)                    (299)      $(299)
Cash dividend ($.25 per
  common share)                                                                (2,552)                  (2,552)
Unrealized holding gain on debt
  and equity securities                                                                      144           144         144
Increase in fair market value
  on interest rate swap                                                                      155           155         155
Foreign currency translation
  adjustments                                                                               (302)         (302)       (302)
                                     ----------      ------      -------      -------      -----       -------       -----

Comprehensive loss                                                                                                   $(302)
                                                                                                                     =====

Balance at August 30, 2003           10,232,983      $1,023      $22,359      $63,613      $(473)      $86,522
                                     ==========      ======      =======      =======      =====       =======
</TABLE>

The accompanying notes are an integral part of this statement.


                                      -6-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (unaudited)
                                 (in thousands)

                                                          Thirteen weeks ended
                                                       -------------------------
                                                       August 30,     August 31,
                                                          2003           2002
                                                       ----------     ----------

Cash flows from operating activities:
  Net loss                                              $   (299)      $   (741)
  Adjustments to reconcile net loss to net cash
  provided by (used in) operating activities
      Depreciation and amortization                          892            781
      Provision for doubtful accounts                         11            122
      Deferred income tax provision (benefit)                (18)             4
      Other non-cash items                                     1              1
      Changes in operating assets and
        liabilities
          Accounts receivable                              2,656           (404)
          Inventories                                       (207)          (623)
          Other current assets                              (227)          (370)
          Other assets                                      (136)          (308)
          Accounts payable                                (1,194)            27
          Accrued liabilities                               (479)        (1,163)
          Accrued income taxes                               239           (354)
          Other noncurrent liabilities                        75             69
                                                        --------       --------

            Net cash provided by (used in)
              operating activities                         1,314         (2,959)
                                                        --------       --------

Cash flows from investing activities:
  Additions to property, plant and
    equipment, net                                          (660)          (834)
  Restricted cash used in investing
    activities                                                75
  Investment at cost                                                       (300)
  Available-for-sale securities
    Purchases                                             (9,657)       (32,467)
    Proceeds from sale                                    12,699         35,196
                                                        --------       --------

      Net cash provided by investing
        activities                                         2,457          1,595
                                                        --------       --------

Cash flows from financing activities:
  Repayments of debt                                        (126)           (56)
  Proceeds from issuance of debt                                             31
  Dividends paid                                          (2,552)
  Proceeds from exercise of stock options                    630            101
  Purchase of treasury stock                                 (74)          (139)
                                                        --------       --------

    Net cash used in financing
      activities                                          (2,122)           (63)
                                                        --------       --------


                                      -7-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

                CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)
                                   (unaudited)
                                 (in thousands)

                                                          Thirteen weeks ended
                                                       -------------------------
                                                       August 30,     August 31,
                                                          2003           2002
                                                       ----------     ----------

Effect of exchange rate changes on
  cash and cash equivalents                             $   (200)      $  (236)
                                                        --------       -------

      INCREASE (DECREASE) IN CASH AND
        CASH EQUIVALENTS                                   1,449        (1,663)

Cash and cash equivalents
  Beginning of period                                      9,459         8,019
                                                        --------       -------

  End of period                                         $ 10,908       $ 6,356
                                                        ========       =======

Supplemental disclosures of cash
  flow information:
    Cash paid during the period for:
      Interest                                          $     59       $    15
                                                        ========       =======

      Income taxes                                      $    304       $   664
                                                        ========       =======

The accompanying notes are an integral part of these statements.


                                      -8-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                       August 30, 2003 and August 31, 2002
                                   (unaudited)

NOTE A - CONSOLIDATED FINANCIAL STATEMENTS

      The consolidated balance sheet as of August 30, 2003, the consolidated
      statement of stockholders' equity and comprehensive loss for the period
      ended August 30, 2003, and the consolidated statements of operations and
      cash flows for the periods ended August 30, 2003 and August 31, 2002, have
      been prepared by the Company without audit. The consolidated balance sheet
      as of May 31, 2003 was derived from audited consolidated financial
      statements. In the opinion of management, all adjustments (which include
      only normally recurring adjustments) necessary to present fairly the
      financial position, changes in stockholders' equity and comprehensive
      loss, results of operations and cash flows at August 30, 2003 (and for all
      periods presented) have been made.

      Certain information and footnote disclosures, normally included in
      financial statements prepared in accordance with accounting principles
      generally accepted in the United States of America, have been condensed or
      omitted. It is suggested that these consolidated financial statements be
      read in conjunction with the financial statements and notes thereto
      included in the fiscal 2003 Annual Report on Form 10-K filed by the
      Company on August 29, 2003. The results of operations for the periods
      ended August 30, 2003 and August 31, 2002 are not necessarily indicative
      of the operating results for the respective full years.

      The consolidated financial statements include the accounts of E-Z-EM, Inc.
      ("E-Z-EM") and all 100%-owned subsidiaries (the "Company"). All
      significant intercompany balances and transactions have been eliminated.

NOTE B - STOCK-BASED COMPENSATION

      In December 2002, the Financial Accounting Standards Board ("FASB") issued
      Statement of Financial Accounting Standards ("SFAS") No. 148, "Accounting
      for Stock-Based Compensation - Transition and Disclosure." SFAS No. 148
      amends the disclosure provisions of SFAS No. 123, "Accounting for
      Stock-Based Compensation," and APB Opinion No. 28, "Interim Financial
      Reporting," to require disclosure in the summary of significant accounting
      policies of the effects of an entity's accounting policy with respect to
      stock-based employee compensation on reported net earnings and earnings
      per share in annual and interim financial statements. The adoption of SFAS
      No. 148 disclosure requirements, effective March 2, 2003, did not have an
      effect on the Company's consolidated financial statements. At August 30,
      2003, the Company has three stock-based compensation plans. The Company
      accounts for these plans under the recognition and measurement principles
      of APB Opinion No. 25, "Accounting for Stock Issued to Employees" and
      related interpretations. Accordingly, no compensation expense has been
      recognized under these plans concerning options granted to key employees
      and to members of the Board of Directors, as all such options granted had
      an exercise price equal to or greater than the market value of the
      underlying common stock on the date of grant. During the thirteen weeks
      ended August 30, 2003 and August 31, 2002, compensation expense of $1,000
      was recognized under these plans for options granted to consultants.


                                      -9-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                       August 30, 2003 and August 31, 2002
                                   (unaudited)

NOTE B - STOCK-BASED COMPENSATION (continued)

      The following table illustrates the effect on net loss and losses per
      share if the Company had applied the fair value recognition provisions of
      SFAS No. 123 to options granted under these plans to key employees and to
      members of the Board of Directors:

                                                 Thirteen weeks ended
                                               -----------------------
                                               August 30,   August 31,
                                                 2003         2002
                                               ----------   ----------
                                                    (in thousands)

      Net loss
        As reported                              $(299)       $(741)
        Pro forma                                 (509)        (966)

      Basic and diluted loss per common
        share
          As reported                            $(.03)       $(.07)
          Pro forma                               (.05)        (.10)

NOTE C - EARNINGS PER COMMON SHARE

      Basic earnings per share are based on the weighted average number of
      common shares outstanding without consideration of potential common stock.
      Diluted earnings per share are based on the weighted average number of
      common and potential common shares outstanding. The calculation takes into
      account the shares that may be issued upon exercise of stock options,
      reduced by the shares that may be repurchased with the funds received from
      the exercise, based on the average price during the period. Potential
      common shares were excluded from the diluted calculation for the thirteen
      weeks ended August 30, 2003 and August 31, 2002, as their effects were
      anti-dilutive.

      Excluded from the calculation of earnings per common share, are options to
      purchase 1,078,381 and 1,395,780 shares of common stock at August 30, 2003
      and August 31, 2002, respectively, as their inclusion would be
      anti-dilutive. The range of exercise prices on the excluded options was
      $3.66 to $12.49 per share at August 30, 2003 and August 31, 2002.

NOTE D - EFFECTS OF RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

      As of July 1, 2003, the Company adopted SFAS No. 149, "Amendment of
      Statement 133 on Derivative Instruments and Hedging Activities." SFAS No.
      149 amends and clarifies accounting for derivative instruments, including
      certain derivative instruments embedded in other contracts, and for
      hedging activities under SFAS No. 133. The adoption of this statement has
      had no effect on the Company's financial position or results of
      operations.


                                      -10-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                       August 30, 2003 and August 31, 2002
                                   (unaudited)

NOTE D - EFFECTS OF RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS (continued)

      In May 2003, the FASB issued SFAS No. 150, "Accounting for Certain
      Financial Instruments with Characteristics of Both Liabilities and
      Equity." SFAS No. 150 improves the accounting for certain financial
      instruments that, under previous guidance, issuers could account for as
      equity. The new statement requires that those instruments be classified as
      liabilities in statements of financial position. This statement shall be
      effective for financial instruments entered into or modified after May 31,
      2003 and otherwise shall be effective at the beginning of the first
      interim period beginning after June 15, 2003. The Company does not have
      any financial instruments which would require reclassification under SFAS
      No. 150. Accordingly, the adoption of SFAS No. 150 has had no effect on
      the Company's financial position or results of operations.

      In January 2003, the FASB issued FASB Interpretation No. 46 ("FIN No.
      46"), "Consolidation of Variable Interest Entities." In general, a
      variable interest entity is a corporation, partnership, trust, or any
      other legal structure used for business purposes that either (a) does not
      have equity investors with voting rights or (b) has equity investors that
      do not provide sufficient financial resources for the entity to support
      its activities. A variable interest entity often holds financial assets,
      including loans or receivables, real estate or other property. A variable
      interest entity may be essentially passive or it may engage in activities
      on behalf of another company. Until now, a company generally has included
      another entity in its consolidated financial statements only if it
      controlled the entity through voting interests. FIN No. 46 changes that by
      requiring a variable interest entity to be consolidated by a company if
      that company is subject to a majority of the risk of loss from the
      variable interest entity's activities or entitled to receive a majority of
      the entity's residual returns or both. FIN No. 46's consolidation
      requirements apply immediately to variable interest entities created or
      acquired after January 31, 2003. The consolidation requirements apply to
      older entities in the first fiscal year or interim period beginning after
      June 15, 2003. Certain of the disclosure requirements apply to all
      financial statements issued after January 31, 2003, regardless of when the
      variable interest entity was established. The Company does not have any
      variable interest entities which would require consolidation under FIN No.
      46. Accordingly, the adoption of FIN No. 46 has had no effect on the
      Company's consolidated financial condition or results of operations.

      In November 2002, the Emerging Issues Task Force ("EITF") reached a
      consensus opinion of EITF 00-21, "Revenue Arrangements with Multiple
      Deliverables". That consensus provides that revenue arrangements with
      multiple deliverables should be divided into separate units of accounting
      if certain criteria are met. The consideration of the arrangement should
      be allocated to the separate units of accounting based on their relative
      fair values, with different provisions if the fair value is contingent on
      delivery of specified items or performance conditions. Applicable revenue
      criteria should be considered separately for each separate unit of
      accounting. EITF 00-21 is effective for revenue arrangements entered into
      in fiscal periods beginning after June 15, 2003. Entities may elect to
      report the change as a cumulative effect adjustment in accordance with APB
      Opinion 20, "Accounting Changes." The Company is currently evaluating the
      effect of the adoption of EITF 00-21 on its financial position and results
      of operations.


                                      -11-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                       August 30, 2003 and August 31, 2002
                                   (unaudited)

NOTE E - COMPREHENSIVE LOSS

      The components of comprehensive loss, net of related tax, are as follows:

                                                     Thirteen weeks ended
                                                   ------------------------
                                                   August 30,    August 31,
                                                      2003          2002
                                                   ----------    ----------
                                                        (in thousands)

      Net loss                                       $(299)       $  (741)
      Unrealized holding gain (loss) on debt
        and equity securities                          144           (851)
      Increase in fair value on interest
        rate swap                                      155
      Foreign currency translation
        adjustments                                   (302)          (376)
                                                     -----        -------

          Comprehensive loss                         $(302)       $(1,968)
                                                     =====        =======

      The components of accumulated other comprehensive loss, net of related
      tax, are as follows:

                                                    August 30,     May 31,
                                                       2003          2003
                                                    ----------     -------
                                                         (in thousands)

      Unrealized holding gain on debt
        and equity securities                        $   899        $ 755
      Fair value on interest rate swap                  (145)        (300)
      Cumulative translation adjustments              (1,227)        (925)
                                                     -------        -----

          Accumulated other comprehensive loss       $  (473)       $(470)
                                                     =======        =====

NOTE F - PLANT CLOSING AND OPERATIONAL RESTRUCTURING

      In May 2003, the Company announced a plan to close its device
      manufacturing facility in San Lorenzo, Puerto Rico as well as its
      heat-sealing operation in Westbury, New York, each of which is part of the
      E-Z-EM segment. The Company has entered into an agreement to outsource
      these operations to a third-party manufacturer. This operations
      realignment is part of the Company's strategic plan of restructuring its
      operations to achieve greater efficiency. The Company expects the project
      to be completed in the fourth quarter of fiscal 2004 and generate savings
      beginning in the 2005 fiscal year. Project costs, primarily severance
      related, are estimated at $1,900,000 and will affect fiscal 2004. During
      the thirteen weeks ended August 30, 2003, project costs aggregated
      $572,000. No loss is expected on the long-lived assets, principally land
      and building with a net carrying value of $1,076,000 at August 30, 2003.


                                      -12-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                       August 30, 2003 and August 31, 2002
                                   (unaudited)

NOTE G - INVENTORIES

      Inventories consist of the following:

                                               August 30,          May 31,
                                                  2003               2003
                                               ----------          -------
                                                      (in thousands)

      Finished goods                            $14,828            $15,738
      Work in process                             2,152              1,653
      Raw materials                              11,694             11,076
                                                -------            -------

                                                $28,674            $28,467
                                                =======            =======

NOTE H - LONG-TERM DEBT

      In September 2002, the Company closed on the financing for the expansion
      of the AngioDynamics headquarters and manufacturing facility in
      Queensbury, New York. The expansion is being financed principally with
      Industrial Revenue Bonds (the "Bonds") issued by the Warren and Washington
      Counties Industrial Development Agency (the "Agency") aggregating
      $3,500,000. The Bonds are issued under a Trust Agreement by and between
      the Agency and a bank, as trustee (the "Trustee"). The proceeds of the
      Bonds are being advanced, as construction occurs, pursuant to a Building
      Loan Agreement by and among the Agency, the Trustee, a second bank (the
      "Bank") and the Company. As of August 30, 2003, the advances aggregated
      $2,777,000 with the remaining proceeds of $723,000 classified as
      restricted cash. The Bonds mature every seven days and are resold by a
      Remarketing Agent. The Bonds bear interest based on the market rate on the
      date the Bonds are resold (1.03% per annum at August 30, 2003) and require
      quarterly interest payments and quarterly principal payments ranging from
      $25,000 to $65,000 through May 2022. In connection with the issuance of
      the Bonds, the Company entered into a Letter of Credit and Reimbursement
      Agreement with the Bank to support the outstanding principal and specified
      interest payments of the Bonds and requires payment of an annual fee on
      the outstanding balance ranging from 1% to 1.9%, depending on financial
      results achieved. The Company also entered into a Remarketing Agreement,
      pursuant to which the Remarketing Agent will use its best efforts to
      arrange for a sale in the secondary market of such Bonds. The Remarketing
      Agreement provides for the payment of an annual fee of .1% of the
      remaining balance.

      The Reimbursement Agreement contains certain financial covenants, relating
      to fixed charge coverage and interest coverage, as defined. Amounts
      borrowed under the Agreement are secured by the aforementioned letter of
      credit and a first mortgage on the land, building and equipment relating
      to the facility.

      The Company entered into an interest rate swap agreement with the Bank,
      effective September 2002, with an initial notional amount of $3,500,000 to
      limit the effect of variability due to interest rates on its rollover of
      the Bonds. The swap agreement, which qualifies as a hedge under SFAS No.
      133, is a contract to exchange floating interest rate payments for fixed
      interest payments periodically over the life of the agreement without the
      exchange of the underlying notional amounts. The swap agreement requires
      the Company to pay a fixed rate of 4.45% and receive payments based on 30
      day LIBOR repriced


                                      -13-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                       August 30, 2003 and August 31, 2002
                                   (unaudited)

NOTE H - LONG-TERM DEBT (continued)

      every seven days through May 2022. Since the swap agreement is classified
      as a cash flow hedge, the fair value of $229,000 has been recorded as a
      component of accrued liabilities, and accumulated other comprehensive loss
      has been increased by $145,000, net of tax benefit, with no impact on
      earnings (see Note E). Amounts to be paid or received under the swap
      agreement are accrued as interest rates change and are recognized over the
      life of the swap agreement as an adjustment to interest expense.

NOTE I - COMMON STOCK

      Under the 1983 and 1984 Stock Option Plans, options for 140,509 shares
      were exercised at prices ranging from $4.22 to $8.58 per share, options
      for 1,002 shares were forfeited at $5.63 per share, and no options were
      granted or expired during the thirteen weeks ended August 30, 2003. Under
      the 1997 AngioDynamics Stock Option Plan, options for .06 shares were
      forfeited at $40,000 per share, and no options were granted, exercised or
      expired during the thirteen weeks ended August 30, 2003.

      In March 2003, the Board of Directors authorized the repurchase of up to
      300,000 shares of the Company's common stock at an aggregate purchase
      price of up to $3,000,000. The Company repurchased 8,900 shares of common
      stock for approximately $74,000 during the thirteen weeks ended August 31,
      2003. In aggregate, the Company repurchased 45,734 shares of common stock
      for approximately $373,000 under this program.

      In June 2003, the Company's Board of Directors declared a cash dividend of
      $.25 per outstanding share of the Company's common stock. The dividend was
      distributed on August 1, 2003 to shareholders of record as of July 15,
      2003. Future dividends are subject to Board of Directors' review of
      operations and financial and other conditions then prevailing.

      On October 22, 2002, the Company completed the previously announced plan
      to combine its two former classes of common stock (Class A and Class B)
      into a single, newly created class of common stock. The transaction was
      effected by merging a newly formed subsidiary into E-Z-EM, with E-Z-EM
      continuing as the surviving corporation in the merger. As a result of this
      merger: each outstanding Class A share and each outstanding Class B share
      was converted into one share of a newly created class of common stock of
      the Company; the super-majority voting requirements contained in the
      Company's certificate of incorporation, relating to the former Class A
      shares, were eliminated and are not applicable to the Company's new class
      of common stock; each holder of common stock now has one vote per share;
      and all matters brought before the stockholders of the Company, other than
      the removal of directors, are now determined by a majority vote.


                                      -14-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                       August 30, 2003 and August 31, 2002
                                   (unaudited)

NOTE J - OPERATING SEGMENTS

      The Company is engaged in the manufacture and distribution of a wide
      variety of products which are classified into two operating segments:
      E-Z-EM products and AngioDynamics products. E-Z-EM products include X-ray
      fluoroscopy products, CT imaging products, virtual colonoscopy products,
      specialty diagnostic tests, and accessory medical products and devices.
      The E-Z-EM segment also includes third-party contract manufacturing of
      diagnostic contrast agents, pharmaceuticals, cosmetics and defense
      decontaminants. AngioDynamics products include angiographic products and
      accessories, dialysis products, PTA dilation catheters, thrombolytic
      products, image-guided vascular access products, endovascular laser venous
      system, and drainage products used in the interventional radiology
      marketplace.

      The Company's chief operating decision maker utilizes operating segment
      net earnings (loss) information in assessing performance and making
      overall operating decisions and resource allocations. Information about
      the Company's segments is as follows:

                                                    Thirteen weeks ended
                                                 --------------------------
                                                 August 30,      August 31,
                                                    2003            2002
                                                 ----------      ----------
                                                       (in thousands)

      Net sales to external customers
        E-Z-EM products                           $ 22,642        $ 22,183
        AngioDynamics products                      10,415           8,097
                                                  --------        --------

      Total net sales to external customers       $ 33,057        $ 30,280
                                                  ========        ========

      Intersegment net sales
        AngioDynamics products                    $    215        $    231
                                                  --------        --------

      Total intersegment net sales                $    215        $    231
                                                  ========        ========

      Operating profit (loss)
        E-Z-EM products                           $   (936)       $ (1,675)
        AngioDynamics products                         943             560
        Eliminations                                    28              (4)
                                                  --------        --------

      Total operating profit (loss)               $     35        $ (1,119)
                                                  ========        ========

      Net earnings (loss)
        E-Z-EM products                           $   (854)       $ (1,069)
        AngioDynamics products                         527             332
        Eliminations                                    28              (4)
                                                  --------        --------

      Total net loss                              $   (299)       $   (741)
                                                  ========        ========


                                      -15-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                       August 30, 2003 and August 31, 2002
                                   (unaudited)

NOTE J - OPERATING SEGMENTS (continued)

                                              August 30,         May 31,
                                                 2003              2003
                                              ----------        ---------
                                                     (in thousands)

      Assets
        E-Z-EM products                       $ 108,896         $ 112,899
        AngioDynamics products                   25,745            26,000
        Eliminations                            (28,050)          (28,275)
                                              ---------         ---------

      Total assets                            $ 106,591         $ 110,624
                                              =========         =========


                                      -16-
<PAGE>

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

The following information should be read together with the consolidated
financial statements and the notes thereto and other information included
elsewhere in this Quarterly Report on Form 10-Q.

Forward-Looking Statements
--------------------------

This Quarterly Report on Form 10-Q, including the section entitled "Management's
Discussion and Analysis of Financial Condition and Results of Operations",
contains certain forward-looking statements within the meaning of Section 27A of
the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E
of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), which
are intended to be covered by the safe harbors created thereby. These statements
relate to future events or the Company's future financial performance and
involve known and unknown risks, uncertainties and other factors that may cause
the Company or its industry's actual results, levels of activity, performance or
achievements to be materially different from any future results, levels of
activity, performance or achievements expressed or implied by the
forward-looking statements. These risks and other factors include those listed
under "Management's Discussion and Analysis of Financial Condition and Results
of Operations - Risk Factors" and elsewhere in this Quarterly Report on Form
10-Q. In some cases, forward-looking statements may be identified by terminology
such as "may", "will", "should", "expects", "intends", "anticipates", "plans",
"believes", "seeks", "estimates", "predicts", "potential", "continue" or
variations of such terms or similar expressions. These statements are only
predictions. In evaluating these statements, readers should specifically
consider various factors, including the risks outlined under "Management's
Discussion and Analysis of Financial Condition and Results of Operations - Risk
Factors". These factors may cause the Company's actual results to differ
materially from any forward-looking statement.

Although the Company believes that the assumptions underlying the
forward-looking statements contained herein are reasonable, any of the
assumptions could be inaccurate, and therefore, there can be no assurance that
the forward-looking statements included in this Form 10-Q will prove to be
accurate. In light of the significant uncertainties inherent in the
forward-looking statements included herein, the inclusion of such information
should not be regarded as a representation by the Company or any other person
that the objectives and plans of the Company will be achieved.

Results of Operations
---------------------

The Company's quarters ended August 30, 2003 and August 31, 2002 both represent
thirteen weeks.

Segment Overview
----------------

The Company operates in two industry segments: E-Z-EM products and AngioDynamics
products. The E-Z-EM operating segment includes X-ray fluoroscopy products, CT
imaging products, virtual colonoscopy products, specialty diagnostic tests, and
accessory medical products and devices. The E-Z-EM segment also includes
third-party contract manufacturing of diagnostic contrast agents,
pharmaceuticals, cosmetics and defense decontaminants. The AngioDynamics
operating segment includes angiographic products and accessories, dialysis
products, PTA dilation catheters, thrombolytic products, image-guided vascular
access products, endovascular laser venous system, and drainage products used in
the interventional radiology marketplace.


                                      -17-
<PAGE>

The following table sets forth certain financial information with respect to the
Company's operating segments:

<TABLE>
<CAPTION>
                                     E-Z-EM      AngioDynamics    Eliminations      Total
                                     ------      -------------    ------------      -----
                                                         (in thousands)
<S>                                 <C>             <C>              <C>          <C>
Quarter ended August 30, 2003
-----------------------------

  Unaffiliated customer sales       $ 22,642        $10,415             --        $ 33,057
  Intersegment sales                      --            215          ($215)             --
  Gross profit                         8,406          5,535             28          13,969
  Operating profit (loss)               (936)           943             28              35

Quarter ended August 31, 2002
-----------------------------

  Unaffiliated customer sales       $ 22,183        $ 8,097             --        $ 30,280
  Intersegment sales                      --            231          ($231)             --
  Gross profit (loss)                  8,333          4,168             (4)         12,497
  Operating profit (loss)             (1,675)           560             (4)         (1,119)
</TABLE>

E-Z-EM Products

E-Z-EM segment operating losses for the current quarter decreased by $739,000.
Both the current quarter and the comparable quarter of the prior year included
charges for restructuring and repositioning the Company. The current quarter
included $572,000 in plant closing and operational restructuring costs related
to the planned closure of the Company's device manufacturing facility in San
Lorenzo, Puerto Rico, as well as its heat-sealing operation in Westbury, New
York. After the realignment, the Company will maintain three core manufacturing
sites; Westbury, New York and Montreal, Canada for its E-Z-EM segment and
Queensbury, New York for its AngioDynamics segment. An expected charge to
earnings of $1,900,000 (inclusive of the $572,000 charge for the first quarter),
mainly severance related, will be recorded in the current year as a result of
this program. Included in the comparable period of last year were $582,000 in
costs associated with the Company's recapitalization, which was completed in the
second quarter.

Excluding the effect of the planned closure of the Company's device
manufacturing facility in San Lorenzo, Puerto Rico and its heat-sealing
operation in Westbury, New York, and the recapitalization costs, E-Z-EM segment
operating losses decreased by $729,000 due to decreased operating expenses and
slightly higher gross profit. Net sales increased 2%, or $459,000, due primarily
to increased sales of CT imaging contrast products, particularly the Company's
CT Smoothie lines, and CT injector systems totaling $913,000, partially offset
by decreased sales of contract manufacturing products of $555,000, due to the
rescheduling of some shipments by two major customers. Price increases had
minimal effect on net sales for the current quarter. Gross profit, expressed as
a percentage of net sales, decreased to 37% for the current quarter, from 38%
for the comparable quarter of the prior year, due primarily to increased raw
material costs and unfavorable changes in sales product mix, partially offset by
decreased freight costs affecting the Company's Westbury operations. Excluding
the aforementioned plant closing and recapitalization costs, operating expenses
decreased $656,000 due to decreased selling and marketing promotional activities
and decreased severance costs of $372,000.

AngioDynamics Products

AngioDynamics segment operating profit improved by $383,000 in the current
quarter due to increased sales and improved gross profit, partially offset by
increased operating expenses. Net sales increased 29%, or $2,318,000, due
primarily to the introduction of new products in the prior year and the growth
in existing products resulting, in large part, from the expansion in the
domestic


                                      -18-
<PAGE>

sales force. Successful new products included the Dura-Flow(TM) Chronic Dialysis
catheter and the Endovascular Laser Venous System for the treatment of varicose
veins. Price increases had minimal effect on net sales for the current quarter.
Gross profit, expressed as a percentage of net sales, improved to 52% for the
current quarter, from 50% for the comparable quarter of the prior year. This
improvement was due primarily to decreased freight costs and improved
manufacturing efficiencies, resulting from a redesign of the production lines
made possible by the recent expansion of the Company's Queensbury, New York
facility. Operating expenses increased $984,000 due, in large part, to the
continued expansion of the domestic sales force, investment in new product
introductions and increased administrative and research and development
expenses.

Consolidated Results of Operations
----------------------------------

For the quarter ended August 30, 2003, the Company reported a net loss of
$299,000, or ($.03) per common share on both a basic and diluted basis, as
compared to a net loss of $741,000, or ($.07) per common share on both a basic
and diluted basis, for the comparable period of last year. Results for the
current quarter were favorably affected by increased sales in both the E-Z-EM
and AngioDynamics segments, improved gross profit in the AngioDynamics segment
and decreased operating expenses in the E-Z-EM segment, partially offset by
increased operating expenses in the AngioDynamics segment. Results for the
current quarter included $572,000, or $.05 per basic share, in plant closing and
operational restructuring costs related to the planned closure of the Company's
device manufacturing facility in San Lorenzo, Puerto Rico, as well as its
heat-sealing operation in Westbury, New York. Results for the comparative period
of last year included $582,000 in costs associated with the Company's common
stock recapitalization, which increased net losses for that quarter by $.06 per
basic share.

Net sales for the quarter ended August 30, 2003 increased 9%, or $2,777,000, as
compared to the quarter ended August 31, 2002, due to increased sales of
AngioDynamics products of $2,318,000 and E-Z-EM products of $459,000, which
resulted from the factors previously disclosed in the segment overview. Price
increases had minimal effect on net sales for the current quarter. Net sales in
international markets, including direct exports from the U.S., decreased 4%, or
$314,000, for the current quarter from the comparable period of last year due
primarily to decreased sales of contract manufacturing products of $555,000,
partially offset by increased sales of X-ray fluoroscopy products of $154,000.

Gross profit, expressed as a percentage of net sales, improved to 42% for the
current quarter from 41% for the comparable quarter of the prior year due to
improved gross profit in the AngioDynamics segment, partially offset by reduced
gross profit as a percentage of net sales in the E-Z-EM segment, which resulted
from the factors previously disclosed in the segment overview.

Selling and administrative ("S&A") expenses were $11,558,000 for the quarter
ended August 30, 2003 compared to $12,027,000 for the quarter ended August 31,
2002. This decrease of $469,000, or 4%, was due to decreased E-Z-EM S&A expenses
of $1,275,000, partially offset by increased AngioDynamics S&A expenses of
$806,000. Decreased E-Z-EM S&A expenses can be attributed to: i) costs
associated with the Company's common stock recapitalization of $582,000 in the
comparable period of the prior year; ii) decreased selling and marketing
promotional activities; and iii) decreased severance costs of $372,000.
Increased AngioDynamics S&A expenses resulted, in large part, from the continued
expansion of its domestic sales force and investment in new product
introductions.

Research and development ("R&D") expenditures remained at 5% of net sales and
increased 14% for the current quarter to $1,804,000 from $1,589,000 for the
comparable quarter of the prior year due primarily to increased spending
relating to AngioDynamics projects of $178,000. Of the R&D expenditures for the
current


                                      -19-
<PAGE>

quarter, approximately 42% relate to AngioDynamics projects, 30% to X-ray
fluoroscopy and CT imaging projects, 17% to general regulatory costs, 5% to
virtual colonoscopy projects, 5% to accessory medical products and devices and
1% to other projects. R&D expenditures are expected to continue at approximately
current levels.

Other income, net of other expenses, totaled $34,000 of expense for the current
quarter compared to $317,000 of income for the comparable period of last year.
This change was due to a decline in foreign currency exchange gains of $312,000
and increased interest expense of $46,000, resulting from the financing of the
AngioDynamics facility expansion.

For the quarter ended August 30, 2003, the Company reported an income tax
provision of $300,000 against earnings before income taxes of $1,000, due
primarily to: i) losses incurred at the Company's Puerto Rican subsidiary, which
are subject to lower tax rates; ii) non-deductible expenses; and iii) the fact
that the Company did not provide for the tax benefit on losses incurred in
certain foreign jurisdictions, since it is more likely than not that such
benefits will not be realized. The losses incurred at the Company's Puerto Rican
subsidiary resulted from the plan to close this facility and to outsource these
operations. For the quarter ended August 31, 2002, the Company's unusually low
effective tax benefit rate of 8% differed from the Federal statutory tax rate of
34% due to non-deductible expenses, primarily related to the Company's common
stock recapitalization.

Liquidity and Capital Resources
-------------------------------

For the quarter ended August 30, 2003, cash dividends, capital expenditures,
repayments of debt, the purchase of treasury stock and working capital were
funded by cash provided by operations and cash reserves. The Company's policy
has generally been to fund operations and capital requirements without incurring
significant debt. However, the Company did elect to finance the AngioDynamics
facility expansion. At August 30, 2003, debt (notes payable, current maturities
of long-term debt and long-term debt) was $4,260,000 (including $3,360,000
relating to the financing of the AngioDynamics facility expansion), as compared
to $4,369,000 at May 31, 2003. The Company has available $2,244,000 under two
bank lines of credit, of which no amounts were outstanding at August 30, 2003.

At August 30, 2003, approximately $16,372,000, or 15%, of the Company's assets
consisted of cash and cash equivalents and short-term debt and equity
securities. The current ratio was 5.38 to 1, with working capital of
$58,084,000, at August 30, 2003, compared to a current ratio of 4.95 to 1, with
working capital of $60,123,000, at May 31, 2003. The Company believes that its
cash reserves as of August 30, 2003, cash generated from operations and existing
lines of credit will provide sufficient liquidity to meet its current
obligations for the next 12 months.

During fiscal 2003, the Company began the expansion of the AngioDynamics
headquarters and manufacturing facility in Queensbury, New York, and, as of
August 30, 2003, had expended approximately $3,140,000 on this project. The
Company expects this expansion to cost approximately $3,500,000. This expansion
is being financed principally with Industrial Revenue Bonds (the "Bonds") issued
by the Warren and Washington Counties Industrial Development Agency (the
"Agency") aggregating $3,500,000. The proceeds of the Bonds are being advanced,
as construction occurs, pursuant to a Building Loan Agreement by and among the
Agency, the Trustee, a bank (the "Bank") and the Company. As of August 30, 2003,
the advances aggregated $2,777,000 with the remaining proceeds of $723,000
classified as restricted cash. The Bonds mature every seven days and are resold
by a Remarketing Agent. The Bonds bear interest based on the market rate on the
date the bonds are resold (1.03% per annum at August 30, 2003) and require
quarterly interest payments and quarterly principal payments ranging from
$25,000 to $65,000 through May 2022. The Company entered into an interest rate
swap with


                                      -20-
<PAGE>

the Bank to convert the variable interest rate to a fixed interest rate of 4.45%
per annum. The principal payments on the Bonds are secured by a letter of credit
with the Bank.

In March 2003, the Board of Directors authorized the repurchase of up to 300,000
shares of the Company's common stock at an aggregate purchase price of up to
$3,000,000. The Company repurchased 8,900 shares of common stock for
approximately $74,000 during the quarter ended August 31, 2003. In aggregate,
the Company has repurchased 45,734 shares of common stock for approximately
$373,000 under this program.

In June 2003, the Company's Board of Directors declared a cash dividend of $.25
per outstanding share of the Company's common stock. The dividend was
distributed on August 1, 2003 to shareholders of record as of July 15, 2003.
Future dividends are subject to Board of Directors' review of operations and
financial and other conditions then prevailing.

Critical Accounting Policies
----------------------------

The Company's significant accounting policies are summarized in Note A to the
Consolidated Financial Statements included in the Company's fiscal 2003 Annual
Report on Form 10-K. While all of these significant accounting policies impact
its financial condition and results of operations, the Company views certain of
these policies as critical. Policies determined to be critical are those
policies that have the most significant impact on the Company's financial
statements and require management to use a greater degree of judgment and/or
estimates. Actual results may differ from those estimates.

The Company believes that given current facts and circumstances, it is unlikely
that applying any other reasonable judgments or estimate methodologies would
cause a material effect on the Company's consolidated results of operations,
financial position or liquidity for the periods presented in this report. The
accounting policies identified as critical are as follows:

Revenue Recognition - The Company recognizes revenues in accordance with
generally accepted accounting principles as outlined in Staff Accounting
Bulletin No. 101, which requires that four basic criteria be met before revenue
can be recognized: (1) persuasive evidence of an arrangement exists; (2) the
price is fixed or determinable; (3) collectibility is reasonably assured; and
(4) product delivery has occurred or services have been rendered. Decisions
relative to criterion (3) regarding collectibility are based upon management
judgments and, should conditions change in the future and cause management to
determine this criterion is not met, the Company's recognized results may be
affected. The Company recognizes revenue as products are shipped and title
passes to customers. Shipping and credit terms are negotiated on a customer by
customer basis. Products are shipped primarily to distributors at an agreed upon
list price. The distributor then resells the products primarily to hospitals
and, depending upon contracts between the Company, the distributor and the
hospital, the distributor may be entitled to a rebate. The Company deducts all
rebates from sales and has a provision for rebates based on historical
information for all rebates that have not yet been submitted to the Company by
the distributors. All customer returns must be pre-approved by the Company. The
Company records revenue on warranties and extended warranties on a straight-line
basis over the term of the related warranty contracts, which generally cover one
year. Deferred revenues related to warranties and extended warranties are
$300,000 at August 30, 2003. Service costs are expensed as incurred.

Accounts Receivable - Accounts receivable, principally trade, are generally due
within 30 to 60 days and are stated at amounts due from customers net of an
allowance for doubtful accounts. The Company performs ongoing credit evaluations
of its customers and adjusts credit limits based upon payment history and the
customer's current credit worthiness, as determined by a review of its current


                                      -21-
<PAGE>

credit information. The Company continuously monitors agings, collections and
payments from customers, and a provision for estimated credit losses is
maintained based upon the Company's historical experience and any specific
customer collection issues that have been identified. While credit losses have
historically been within the Company's expectations and the provisions
established, the Company cannot guarantee that the same credit loss rates will
be experienced in the future. The Company writes off accounts receivable when
they become uncollectible. Concentration risk exists relative to the Company's
accounts receivable, as 25% of the Company's total accounts receivable balance
at August 30, 2003 is concentrated in one distributor. While the accounts
receivable related to this distributor may be significant, the Company does not
believe the credit loss risk to be significant given the distributor's
consistent payment history.

Income Taxes - In preparing the Company's financial statements, income tax
expense is calculated for each of the jurisdictions in which the Company
operates. This process involves estimating actual current taxes due plus
assessing temporary differences arising from differing treatment for tax and
accounting purposes that are recorded as deferred tax assets and liabilities.
Deferred tax assets are periodically evaluated to determine their recoverability
(based primarily on the Company's ability to generate future taxable income),
and where their recovery is not likely, a valuation allowance is established and
a corresponding additional tax expense is recorded in the Company's statement of
earnings. If actual results differ from the Company's estimates given changes in
assumptions, the provision for income taxes could be materially impacted.

Inventories - The Company values its inventory at the lower of the actual cost
to purchase and/or manufacture (on the first-in, first-out method) or the
current estimated market value of the inventory. On an ongoing basis, inventory
quantities on hand are reviewed and an analysis of the provision for excess and
obsolete inventory is performed based primarily on product expiration dating and
the Company's estimated sales forecast of product demand, which is based on
sales history and anticipated future demand. The Company's estimates of future
product demand may prove to be inaccurate, in which case the Company may have
understated or overstated the provision required for excess and obsolete
inventory. Therefore, although every effort is made to ensure the accuracy of
the Company's forecasts of future product demand, any significant unanticipated
changes in demand could have a significant impact on the value of the Company's
inventory and reported operating results.

Property, Plant and Equipment - Property, plant and equipment stated at cost,
less accumulated depreciation, is depreciated principally using the
straight-line method over the estimated useful lives of the assets. Useful lives
are based on management's estimates of the period over which the asset will
generate revenue. Any change in conditions that would cause management to change
its estimate as to the useful lives of a group or class of assets may
significantly impact the Company's depreciation expense on a prospective basis.

Effects of Recently Issued Accounting Pronouncements
----------------------------------------------------

As of July 1, 2003, the Company adopted SFAS No. 149, "Amendment of Statement
133 on Derivative Instruments and Hedging Activities." SFAS No. 149 amends and
clarifies accounting for derivative instruments, including certain derivative
instruments embedded in other contracts, and for hedging activities under SFAS
No. 133. The adoption of this statement has had no effect on the Company's
financial position or results of operations.

In May 2003, the FASB issued SFAS No. 150, "Accounting for Certain Financial
Instruments with Characteristics of Both Liabilities and Equity." SFAS No. 150
improves the accounting for certain financial instruments that, under previous
guidance, issuers could account for as equity. The new statement requires that


                                      -22-
<PAGE>

those instruments be classified as liabilities in statements of financial
position. This statement is effective for financial instruments entered into or
modified after May 31, 2003 and otherwise is effective at the beginning of the
first interim period beginning after June 15, 2003. The Company does not have
any financial instruments that would require reclassification under SFAS No.
150. Accordingly, the adoption of SFAS No. 150 has had no effect on the
Company's financial position or results of operations.

In January 2003, the FASB issued FASB Interpretation No. 46 ("FIN No. 46"),
"Consolidation of Variable Interest Entities." In general, a variable interest
entity is a corporation, partnership, trust, or any other legal structure used
for business purposes that either (a) does not have equity investors with voting
rights or (b) has equity investors that do not provide sufficient financial
resources for the entity to support its activities. A variable interest entity
often holds financial assets, including loans or receivables, real estate or
other property. A variable interest entity may be essentially passive or it may
engage in activities on behalf of another company. Until now, a company
generally has included another entity in its consolidated financial statements
only if it controlled the entity through voting interests. FIN No. 46 changes
that by requiring a variable interest entity to be consolidated by a company if
that company is subject to a majority of the risk of loss from the variable
interest entity's activities or entitled to receive a majority of the entity's
residual returns or both. FIN No. 46's consolidation requirements apply
immediately to variable interest entities created or acquired after January 31,
2003. The consolidation requirements apply to older entities in the first fiscal
year or interim period beginning after June 15, 2003. Certain of the disclosure
requirements apply to all financial statements issued after January 31, 2003,
regardless of when the variable interest entity was established. The Company
does not have any variable interest entities which would require consolidation
under FIN No. 46. Accordingly, the adoption of FIN No. 46 has had no effect on
the Company's consolidated financial condition or results of operations.

In November 2002, the Emerging Issues Task Force ("EITF") reached a consensus
opinion of EITF 00-21, "Revenue Arrangements with Multiple Deliverables". That
consensus provides that revenue arrangements with multiple deliverables should
be divided into separate units of accounting if certain criteria are met. The
consideration of the arrangement should be allocated to the separate units of
accounting based on their relative fair values, with different provisions if the
fair value is contingent on delivery of specified items or performance
conditions. Applicable revenue criteria should be considered separately for each
separate unit of accounting. EITF 00-21 is effective for revenue arrangements
entered into in fiscal periods beginning after June 15, 2003. Entities may elect
to report the change as a cumulative effect adjustment in accordance with APB
Opinion 20, "Accounting Changes." The Company is currently evaluating the effect
of the adoption of EITF 00-21 on its financial position and results of
operations.

Risk Factors
------------

The risks described below are not the only ones facing the Company. The
Company's business is also subject to the risks that affect many other companies
in its industry, such as competition, technology, results of pending or future
clinical trials, overall economic conditions, general market conditions, foreign
currency exchange rate fluctuations and international operations. Additional
risks not currently known to management or that it believes are immaterial also
may impair the Company's business operations and its liquidity.


                                      -23-
<PAGE>

The market dynamics and competitive environment in the healthcare industry are
subject to rapid change, factors which may affect the Company's operations

The Company believes that government regulation, private sector programs and
reimbursement policies will continue to change the worldwide healthcare
industry, potentially resulting in further business consolidations and
alliances. As such, the market dynamics and competitive environment are subject
to rapid change, factors which may affect the Company's growth plans and
operating results.

The Company's products require regulatory approval, which can be expensive and
time-consuming, and may not be granted

The Company's products are subject to extensive regulation in the U.S. by the
Food & Drug Administration ("FDA"), as well as certain state authorities.
Similar regulatory oversight is in place in foreign markets where the Company
operates. The Company must obtain specific approval or clearance from the FDA
and respective foreign regulatory bodies before it can market products in these
markets. The process of obtaining such approvals or clearances can be onerous
and costly, requiring the Company to demonstrate the safety and efficacy of new
products. There can be no assurance that all approvals and clearances sought by
the Company will be granted on a timely basis, if at all. The Company is
presently awaiting 510(k) market clearance from the FDA for several line
extension and next generation medical devices.

Price pressure in the healthcare industry is expected to continue to increase

Public and private sector programs designed to reduce healthcare costs exist in
the U.S. and in many other countries where the Company does business. Such
policies and programs require healthcare providers to focus on the delivery of
medical services on the most cost-effective basis. New products developed by the
Company may offer the potential to improve productivity and reduce costs, but
must meet the aforementioned regulatory requirements prior to commercialization.
Even after regulatory approval is obtained for such products, demand may be
limited until reimbursement policies are established by private and public
third-party payers. These factors can combine to create downward pressure on
product prices in the market in general.

Pricing flexibility is further constrained by the formation of large Group
Purchasing Organizations ("GPO" or "GPOs") - combinations of hospitals and other
large customers to combine purchasing power. Due to the multi-year term of
typical GPO contracts, the Company's ability to pass along base cost increases
through increased prices is limited. Consolidation in the healthcare industry
has also resulted in a broader product range in typical GPO contracts.
Transactions with GPOs are often larger, more complex, and involve more
long-term contracts than in the past. GPOs' enhanced purchasing power may
continue to increase the pressure on product pricing in the market as a whole.
Several GPOs have executed contracts with the Company's market competitors,
which exclude the Company, and other GPOs may do so in the future. In many
cases, the Company has continued to sell to individual members of these GPOs on
a direct basis, by lowering its pricing. While the Company continues to sell to
individual members of these GPOs on a direct basis, the contracts, if enforced
against the GPO members, may adversely affect the Company's sales in the future.

The adoption rate of Virtual Colonoscopy as a screening modality for colon
cancer has been slower than anticipated

The Company's growth strategy involves investing a portion of its financial,
management and other resources on the further development of a unique product
set for use in Virtual Colonoscopy. However, to date, the adoption rate of
Virtual Colonoscopy as a screening modality for colon cancer has been slower
than anticipated. The Company believes this is principally due to the present
lack


                                      -24-
<PAGE>

of private and public reimbursement standards for Virtual Colonoscopy screening.
Additionally, the American Cancer Society ("ACS") has not yet included Virtual
Colonoscopy in its published screening guidelines for colon cancer, believing
the evidence to do so is insufficient at this time. Together, these and other
factors contribute to the uncertainly surrounding the evolution of the Virtual
Colonoscopy market and the Company's position in it.

The market potential for Reactive Skin Decontamination Lotion is uncertain

The market potential for Reactive Skin Decontamination Lotion ("RSDL"), a
product for which the Company has exclusive manufacturing rights, is subject to
a number of uncertainties. One factor is the nature of the military procurement
process itself -- a lengthy bureaucratic process that often requires product
modifications before substantial orders are placed. Another factor is
uncertainty surrounding the threat from chemical weapons as instruments of
terror, making it difficult to quantify the potential of the civilian emergency
service organization market. These and other factors may have an impact on RSDL
sales in the future.

The Company's success will be increasingly dependent on the development,
manufacturing and marketing of new products

An increasing portion of the Company's revenues are derived from new products,
both internally developed and externally sourced. Continued success requires
effective product development, regulatory approval, production and marketing of
new products. The Company obtains marketing rights to new products by partnering
with other companies who seek to penetrate the markets which the Company serves.
Typically these partnerships involve manufacturing agreements under which the
Company has the right to manufacture the product if there is a failure to
supply. However, the failure to meet market demand, even temporarily can have an
adverse effect on market penetration.

A significant part of the Company's business is dependent on its intellectual
property

The Company's continued ability to market and further develop its EmpowerCT(R)
injector system - a product important to its continued growth and the only CT
injector on the market to include patented EDA(TM) technology designed to aid in
the detection of contrast extravasations - is dependent on the Company's ability
to protect its patent rights in the product. The CT injector market is
characterized by strong intellectual property ("IP") positions and aggressive IP
protection strategies among all principal competitors. These factors combine to
make the introduction of new differentiating technology and other product
enhancements a slow and costly process. The Company continues to take what it
believes to be appropriate measures to protect its IP position in this area, but
challenges to its patents and copyrights can not be discounted.

The Company holds a number of other issued U.S. and foreign patents and has
filed a number of U.S. and counterpart patent applications in other countries.
There can be no assurance that the Company's U.S. and foreign issued patents or
patent applications will offer any protection or that they will not be
challenged, invalidated or circumvented. In addition, there can be no assurance
that competitors will not obtain patents that will prevent, limit or interfere
with the Company's ability to make, use or sell its products either in the U.S.
or in international markets.

Item 3. Quantitative and Qualitative Disclosures About Market Risk
        ----------------------------------------------------------

The Company is exposed to market risk from changes in foreign currency exchange
rates and, to a much lesser extent, interest rates on investments and financing,
which could impact results of operations and financial position. While the


                                      -25-
<PAGE>

Company entered into an interest rate swap with a bank to limit its exposure to
interest rate change market risk on its variable interest rate financing, it
does not currently engage in any other hedging or other market risk management
tools. There have been no material changes with respect to market risk
previously disclosed in the fiscal 2003 Annual Report on Form 10-K.

Foreign Currency Exchange Rate Risk
-----------------------------------

The financial reporting of the Company's international subsidiaries is
denominated in currencies other than the U.S. dollar. Since the functional
currency of the Company's international subsidiaries is the local currency,
foreign currency translation adjustments are accumulated as a component of
accumulated other comprehensive loss in stockholders' equity. Assuming a
hypothetical aggregate change in the exchange rates of foreign currencies versus
the U.S. dollar of 10% at August 30, 2003, the Company's assets and liabilities
would increase or decrease by $2,864,000 and $398,000, respectively, and the
Company's net sales and net losses would increase or decrease by $2,000,000 and
$40,000, respectively, on an annual basis.

The Company also maintains intercompany balances and loans receivable with
subsidiaries with different local currencies. These amounts are at risk of
foreign exchange losses if exchange rates fluctuate. Assuming a hypothetical
aggregate change in the exchange rates of foreign currencies versus the U.S.
dollar of 10% at August 30, 2003, pre-tax earnings would be favorably or
unfavorably impacted by approximately $367,000 on an annual basis.

Interest Rate Risk
------------------

The Company is exposed to interest rate change market risk with respect to its
investments in tax-free municipal bonds in the amount of $5,410,000. The bonds
bear interest at a floating rate established weekly. For the quarter ended
August 30, 2003, the after-tax interest rate on the bonds approximated 1.0%.
Each 100 basis point (1%) fluctuation in interest rates will increase or
decrease interest income on the bonds by approximately $54,000 on an annual
basis.

As the Company's principal amount of fixed interest rate financing approximated
$900,000 at August 30, 2003, a change in interest rates would not materially
impact results of operations or financial position. At August 30, 2003, the
Company maintained variable interest rate financing of approximately $3,360,000
in connection with the AngioDynamics facility expansion and has limited its
exposure to interest rate change market risk by entering into an interest rate
swap agreement with a bank.

Item 4. Controls and Procedures
        -----------------------

Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by this report, the Company's management,
under the supervision and with the participation of the Company's Chief
Executive Officer and Chief Financial Officer, evaluated the effectiveness of
the design and operation of the Company's disclosure controls and procedures
pursuant to Rule 13a-15(b) of the Securities Exchange Act of 1934, as amended.
Based on that evaluation, the Chief Executive Officer and the Chief Financial
Officer concluded that the Company's disclosure controls and procedures as of
the end of the period covered by this report have been designed and are
functioning effectively to provide reasonable assurance that the information
required to be disclosed by the Company (including its consolidated
subsidiaries) in reports filed under the Securities Exchange Act of 1934, as
amended, is recorded, processed, summarized and reported within the time periods
specified in the Securities and Exchange Commission's rules and forms. The
Company believes that a controls system, no


                                      -26-
<PAGE>

matter how well designed and operated, cannot provide absolute assurance that
the objectives of the controls system are met, and no evaluation of controls can
provide absolute assurance that all control issues and instances of fraud, if
any, within a company have been detected.

Changes in Internal Controls over Financial Reporting

No significant changes were made in the Company's internal controls over
financial reporting or in other factors that could significantly affect these
controls during the quarter ended August 30, 2003.


                                      -27-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

                           Part II: Other Information

Item 1. Legal Proceedings
        -----------------

None.

Item 2. Changes in Securities and Use of Proceeds
        -----------------------------------------

None.

Item 3. Defaults Upon Senior Securities
        -------------------------------

None.

Item 4. Submission Of Matters to a Vote of Security Holders
        ---------------------------------------------------

None.

Item 5. Other Information
        -----------------

None.

Item 6. Exhibits and Reports on Form 8-K
        --------------------------------

(a) Exhibits
    --------

No.                           Description                                Page
---                           -----------                                ----

 3.1  Restated Certificate of Incorporation of the Registrant, as
      amended                                                             (a)

 3.2  Bylaws of the Registrant, as amended                                (b)

31.1  Certification pursuant to Rule 13a-14(a)/15d-14(a) as adopted
      pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
      (Anthony A. Lombardo)                                               31

31.2  Certification pursuant to Rule 13a-14(a)/15d-14(a) as adopted
      pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
      (Dennis J. Curtin)                                                  32

32.1  Certification pursuant to Title 18, United States Code,
      Section 1350 as adopted pursuant to Section 906 of the
      Sarbanes-Oxley Act of 2002 (Anthony A. Lombardo)                    33

32.2  Certification pursuant to Title 18, United States Code,
      Section 1350 as adopted pursuant to Section 906 of the
      Sarbanes-Oxley Act of 2002 (Dennis J. Curtin)                       34

      (a)   Incorporated by reference to Exhibit 3(i) to the Registrant's Annual
            Report on Form 10-K for the fiscal year ended May 31, 1997, filed
            under Commission File No. 1-11479, and to Exhibit 1 to the
            Registrant's Registration Statement on Form 8-A filed with the
            Commission on October 22, 2002.


                                      -28-
<PAGE>

      (b)   Incorporated by reference to Exhibit 3(ii) to the Registrant's
            Annual Report on Form 10-K for the fiscal year ended May 28, 1994,
            filed under Commission File No. 0-13003.

(b) Reports on Form 8-K
    -------------------

The following reports on Form 8-K were filed during the quarter ended August 30,
2003:

The Company filed a Form 8-K dated August 13, 2003 reporting information under
"Item 7. Financial Statements and Exhibits" and "Item 12. Results of Operations
and Financial Condition" announcing its results of operations for the quarter
ended August 30, 2003.


                                      -29-
<PAGE>

                                   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.

                                        E-Z-EM, Inc.
                                        ----------------------------------------
                                        (Registrant)


Date October 13, 2003                   /s/ Anthony A. Lombardo
     ----------------                   ----------------------------------------
                                        Anthony A. Lombardo, President,
                                        Chief Executive Officer and Director


Date October 13, 2003                   /s/ Dennis J. Curtin
     ----------------                   ----------------------------------------
                                        Dennis J. Curtin, Senior Vice
                                        President - Chief Financial Officer
                                        (Principal Financial and Chief
                                        Accounting Officer)


                                      -30-