================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                             ----------------------


                                    FORM 10-Q




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

                 For the Quarterly Period Ended October 1, 2004

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



                        Commission File Number 333-43089




                               THE GSI GROUP, INC.
             (Exact name of registrant as specified in its charter)


                             DELAWARE     37-0856587
                (State or other jurisdiction     (I.R.S. Employer
            of incorporation or organization)     Identification No.)

             1004 E. ILLINOIS STREET, ASSUMPTION, ILLINOIS     62510
             (Address of principal executive offices)     (Zip 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:  Yes
[  ]  No  [X]

     Indicate  the  number  of  shares  outstanding  of each of the registrant's
classes  of  common stock, as of the latest practicable date.  Common stock, par
value  $0.01  per  share,  826,948  shares  outstanding as of November 8, 2004.

================================================================================

                                        1
<PAGE>




                                TABLE OF CONTENTS
                                                                           PAGE
                                                                           ----
PART  I  -  FINANCIAL  INFORMATION
  Item  1.   Financial  Statements
               Condensed Consolidated Balance Sheets                          3
               Condensed Consolidated Statements of Income                    4
               Condensed Consolidated Statements of Cash Flows                5
               Notes to Condensed Consolidated Financial Statements           6

  Item 2.   Management's Discussion and Analysis of Financial Condition and
            Results  of  Operations                                          17
  Item 3.   Quantitative  and Qualitative Disclosure About Market Risk       20
  Item 4.   Controls and Procedures                                          20

PART  II  -  OTHER  INFORMATION
  Item 1.   Legal Proceedings                                                21
  Item 2.   Changes in Securities and Use of Proceeds                         *
  Item 3.   Defaults Upon Senior Securities                                   *
  Item 4.   Submission of Matters to a Vote of Security Holders               *
  Item 5.   Other Information                                                 *
  Item 6.   Exhibits and Reports on Form 8-K                                 21




*  No  response  to  this  item  is  included  herein  for the reason that it is
inapplicable.

                                        2
<PAGE>
                         PART I - FINANCIAL INFORMATION

                          ITEM 1 - FINANCIAL STATEMENTS
<TABLE>
<CAPTION>

                                   THE GSI GROUP, INC. AND SUBSIDIARIES
                                   CONDENSED CONSOLIDATED BALANCE SHEETS
                              (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

                                                  (UNAUDITED)

                                                                               OCTOBER 1,    DECEMBER 31,
ASSETS                                                                            2004           2003
----------------------------------------------------------------------------  ------------  --------------
<S>                                                                           <C>           <C>
Current Assets:
  Cash and cash equivalents. . . . . . . . . . . . . . . . . . . . . . . . .  $     2,239   $       3,439
  Accounts receivable, net . . . . . . . . . . . . . . . . . . . . . . . . .       42,226          27,083
  Inventories, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       52,355          54,165
  Prepaids . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        2,225           4,468
  Other. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        2,937           2,882
                                                                              ------------  --------------
      Total current assets . . . . . . . . . . . . . . . . . . . . . . . . .      101,982          92,037
                                                                              ------------  --------------
Property, Plant and Equipment, net . . . . . . . . . . . . . . . . . . . . .       31,588          32,673
                                                                              ------------  --------------
Other Assets:
  Goodwill and other intangible assets, net. . . . . . . . . . . . . . . . .       11,775          12,243
  Deferred taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        1,461           1,077
  Other. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        2,718           2,881
                                                                              ------------  --------------
      Total other assets . . . . . . . . . . . . . . . . . . . . . . . . . .       15,954          16,201
                                                                              ------------  --------------
      Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $   149,524   $     140,911
                                                                              ============  ==============

LIABILITIES AND  STOCKHOLDERS' DEFICIT
----------------------------------------------------------------------------
Current Liabilities:
  Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $    17,565   $      17,139
  Accrued interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        4,252           1,751
  Payroll and payroll related expenses . . . . . . . . . . . . . . . . . . .        6,351           3,071
  Accrued expenses and other liabilities . . . . . . . . . . . . . . . . . .        6,433           3,697
  Customer deposits. . . . . . . . . . . . . . . . . . . . . . . . . . . . .        8,614           8,875
  Current maturities of long-term debt . . . . . . . . . . . . . . . . . . .        5,422             148
                                                                              ------------  --------------
      Total current liabilities. . . . . . . . . . . . . . . . . . . . . . .       48,637          34,681
                                                                              ------------  --------------
Long-Term Debt, less current maturities. . . . . . . . . . . . . . . . . . .      132,812         129,563
                                                                              ------------  --------------
Commitments and Contingencies
Stockholders' Deficit:
  Common stock, $.01 par value, voting (authorized 6,900,000 shares; issued
    6,633,652 shares; outstanding 626,948 shares at October 1, 2004 and
    1,575,000 shares at December 31, 2003 ). . . . . . . . . . . . . . . . .           16              16
  Common stock, $.01 par value, nonvoting (authorized 1,100,000 shares;
    issued 1,059,316 shares; outstanding 200,000 shares) . . . . . . . . . .            2               2
  Paid-in capital. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .        3,006           3,006
  Accumulated other comprehensive loss (cumulative currency  translation
   adjustment) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      (12,257)        (11,929)
  Retained earnings. . . . . . . . . . . . . . . . . . . . . . . . . . . . .       18,867          12,531
  Treasury stock, at cost, voting (6,006,704 shares at October 1, 2004 and
    5,058,652 shares at December 31, 2003) . . . . . . . . . . . . . . . . .      (41,550)        (26,950)
  Treasury stock, at cost, nonvoting (859,316 shares). . . . . . . . . . . .           (9)             (9)
                                                                              ------------  --------------
      Total stockholders' deficit. . . . . . . . . . . . . . . . . . . . . .      (31,925)        (23,333)
                                                                              ------------  --------------
      Total liabilities and stockholders' deficit. . . . . . . . . . . . . .  $   149,524   $     140,911
                                                                              ============  ==============
</TABLE>


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

                                        3
<PAGE>
<TABLE>
<CAPTION>


                             THE GSI GROUP, INC. AND SUBSIDIARIES
                          CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                        (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
                                          (UNAUDITED)


                       THREE FISCAL MONTHS ENDED     NINE FISCAL MONTHS ENDED
                       -------------------------     ------------------------

                                               OCT. 1,    SEPT. 26,     OCT. 1,     SEPT. 26,
                                                2004        2003         2004         2003
                                              ---------  -----------  -----------  -----------
<S>                                           <C>        <C>          <C>          <C>
Sales                                         $ 89,856   $   77,270   $  228,345   $  187,233

Cost of sales                                   68,315       59,421      181,654      147,183
                                              ---------  -----------  -----------  -----------

    Gross profit . . . . . . . . . . . . . .    21,541       17,849       46,691       40,050

Selling, general and administrative expenses     9,832        9,924       26,885       27,474
Amortization expense . . . . . . . . . . . .       163          236          487          859
                                              ---------  -----------  -----------  -----------
  Total operating expenses . . . . . . . . .     9,995       10,160       27,372       28,333
                                              ---------  -----------  -----------  -----------

Operating income . . . . . . . . . . . . . .    11,546        7,689       19,319       11,717

Other expense:
  Interest expense . . . . . . . . . . . . .    (3,940)      (3,239)     (10,454)      (9,414)
  Other, net . . . . . . . . . . . . . . . .      (822)         112       (1,331)        (533)
                                              ---------  -----------  -----------  -----------

    Income before income tax expense . . . .     6,784        4,562        7,534        1,770

Income tax expense . . . . . . . . . . . . .       104          212          448          400
                                              ---------  -----------  -----------  -----------

    Net income . . . . . . . . . . . . . . .  $  6,680   $    4,350   $    7,086   $    1,370
                                              ---------  -----------  -----------  -----------


Basic and diluted income per share . . . . .  $   8.08   $     2.45   $     4.85   $     0.77
                                              ---------  -----------  -----------  -----------

Weighted average common shares outstanding .   826,948    1,775,000    1,461,281    1,775,000
                                              =========  ===========  ===========  ===========
</TABLE>




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

                                        4
<PAGE>
<TABLE>
<CAPTION>

                                    THE GSI GROUP, INC. AND SUBSIDIARIES
                               CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                               (IN THOUSANDS)
                                                 (UNAUDITED)


                                                                      NINE FISCAL MONTHS ENDED
                                                                     --------------------------
                                                                              OCT. 1,             SEPT. 26,
                                                                                2004                2003
                                                                     --------------------------  -----------
<S>                                                                  <C>                         <C>
Cash Flows From Operating Activities:
  Depreciation and amortization expense . . . . . . . . . . . . . .                      3,937        4,859
  Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                      5,430        1,758
                                                                     --------------------------  -----------
          Net cash flows provided by operating activities . . . . .                      9,367        6,617
                                                                     --------------------------  -----------


Cash Flows From Investing Activities:
  Capital expenditures. . . . . . . . . . . . . . . . . . . . . . .                     (3,415)      (1,167)
  Proceeds from sale of fixed assets. . . . . . . . . . . . . . . .                        870          993
  Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                         (7)         499
                                                                     --------------------------  -----------
          Net cash flows provided by (used in) investing activities                     (2,552)         325
                                                                     --------------------------  -----------

Cash Flows From Financing Activities:
    Proceeds from shareholder loan. . . . . . . . . . . . . . . . .                      5,816        1,216
    Payments on shareholder loan. . . . . . . . . . . . . . . . . .                       (970)      (1,991)
  Payments on long-term debt. . . . . . . . . . . . . . . . . . . .                         --       (2,006)
  Net (payments) borrowings under line of credit agreement. . . . .                      3,561       (3,574)
    Purchase of Treasury Stock. . . . . . . . . . . . . . . . . . .                    (14,600)          --
    Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . .                       (750)        (959)
  Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                     (1,090)         486
                                                                     --------------------------  -----------
          Net cash flows used in financing activities . . . . . . .                     (8,033)      (6,828)
                                                                     --------------------------  -----------

Effect of Exchange Rate Changes on Cash . . . . . . . . . . . . . .                         18          256
                                                                     --------------------------  -----------

Increase (Decrease) In Cash and Cash Equivalents. . . . . . . . . .  $                  (1,200)  $      370
Cash and Cash Equivalents, beginning of period. . . . . . . . . . .                      3,439        2,936
                                                                     --------------------------  -----------
Cash and Cash Equivalents, end of period. . . . . . . . . . . . . .  $                   2,239   $    3,306
                                                                     ==========================  ===========


</TABLE>



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


                                        5
<PAGE>
                      THE GSI GROUP, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1.     SUMMARY  OF  SIGNIFICANT  ACCOUNTING  POLICIES

          The  financial  statements  have  been prepared by The GSI Group, Inc.
(the  "Company"),  without  audit,  pursuant to the rules and regulations of the
Securities  and  Exchange  Commission.  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 pursuant to such rules and regulations, although
the  Company  believes that the disclosures are adequate to make the information
not  misleading.  These  financial statements should be read in conjunction with
the  financial  statements and related notes contained in the Company's December
31,  2003 Form 10-K as filed with the Securities and Exchange Commission.  Other
than  as  indicated herein, there have been no significant changes from the data
presented  in  said  10-K.

     In  the  opinion  of  management,  the  financial  statements  contain  all
adjustments necessary to present fairly the financial position of the Company as
of  October  1,  2004  and  the  results of operations for the nine months ended
October 1, 2004 and cash flows for the nine months ended October 1, 2004.  Those
adjustments  consist  only  of  normal  recurring  adjustments.

     The  results  of operations for the nine-month period ended October 1, 2004
are  not  necessarily  indicative  of  the  operating results for the full year.


2.     COMPREHENSIVE  INCOME

          The  components  of comprehensive income for the periods presented are
as  follows  (in  thousands):
<TABLE>
<CAPTION>


                                             October 1,   September 26,
                                                2004           2003
                                            ------------  --------------
<S>                                         <C>           <C>
Net income . . . . . . . . . . . . . . . .  $     7,086   $        1,370
Cumulative currency translation adjustment         (328)           2,100
  Comprehensive income . . . . . . . . . .  $     6,758   $        3,470
                                            ============  ==============
</TABLE>



3.     DETAIL  OF  CERTAIN  ASSETS
<TABLE>
<CAPTION>


                    OCTOBER 1,   DECEMBER 31,
                       2004          2003
                    -----------  -------------
(IN THOUSANDS)
<S>                 <C>          <C>
Inventories
  Raw materials. .  $    19,153  $      13,940
  Work-in-process.        8,752         18,443
  Finished goods .       24,450         21,782
                    -----------  -------------
       Total . . .  $    52,355  $      54,165
                    ===========  =============
</TABLE>



4.   SUPPLEMENTAL  CASH  FLOW  INFORMATION

     The  Company  paid  approximately $6.9 million and $6.5 million in interest
during  the  nine  months  ended  October  1,  2004 and September 26, 2003.  The
Company  paid  no  income  taxes  during the first nine months of 2004 and 2003.


                                        6
<PAGE>

5.     LONG-TERM  DEBT

     The  indenture  governing  the Company's senior subordinated notes contains
certain  restrictive  covenants.  The more significant of the covenants restrict
the  ability of the Company to dispose of assets, incur additional indebtedness,
pay  dividends  or make distributions and other payments affecting subsidiaries.
The  Company  was  in  compliance  with  the covenants under the indenture as of
October  1,  2004.

          The  Credit  Facility  with  Congress  Financial Corporation (Central)
requires  the  Company  to  maintain  a  senior debt to EBITDA ratio and a fixed
charge  coverage  ratio.  Borrowings  under  the  Credit Facility are secured by
substantially  all  of the assets of the Company, including the capital stock of
any  existing  or  future  subsidiaries,  except  the Brazilian subsidiary.  The
Company  had  $29.2  million of availability on the line as of October 1, 2004.

     On July 9, 2004, Congress Financial Corporation and the Company amended the
existing credit facility (the "Credit Facility") to provide for term loans up to
a  maximum  of  $20.8  million,  as  well as to increase the Sloan Participation
Obligations  set forth therein from $2.5 million to $5.0 million.  Proceeds from
the  increased  term  loan  were used to purchase Voting Common Stock from Craig
Sloan  upon  his  retirement.  A  Capital Call Agreement was also signed on this
date  requiring  Mr.  Sloan to invest in the Company, if Excess Availability, as
defined  in  the  Credit  Facility,  falls below $5.0 million, in an amount that
causes  such  availability  to  be  at  least  $10.0  million.

     On October 19, 2004, Congress Financial Corporation and the Company amended
the  existing  credit  facility (the "Credit Facility") to decrease the interest
rate  on the term note by 1.25% and to provide for a revolving feature where the
line  can  be  between  $8.0  million  and  $17.5 million for the period between
October  19,  2004  and  April  19,  2005.

     Subsequent  to  October  1,  2004,  the  Company  purchased  a building and
manufacturing  equipment  from  a  company  controlled  by  a shareholder of the
Company  for  $2.3 million.  The Company was previously leasing the building and
manufacturing  equipment  from  a  company  controlled  by  a  shareholder.

6.     COMMITMENTS  AND  CONTINGENCIES

     Sales  of  agricultural  equipment are seasonal, with farmers traditionally
purchasing  grain  storage  bins  and grain drying and handling equipment in the
summer and fall in conjunction with the harvesting season, and swine and poultry
producers  purchasing equipment during prime construction periods in the spring,
summer  and  fall.  The  Company's  sales  and net income have historically been
lower  during the first and fourth fiscal quarters as compared to the second and
third  quarters.

     The  Company  has  a  contract  with  the  Yemen  Company  for  Industrial
Development to manufacture and supervise the assembly of grain handling systems.
Other current assets include $1.0 million of retainage withheld until completion
of  the  project  and  the  meeting  of  certain  performance  criteria.

     The  Company  has a contract with BMA Consulting, Inc., which is owned by a
shareholder of the Company, to provide consulting services over the next 3 years
and  to  pay  $0.7  million  at  the  end  of  the  period.

7.   BUSINESS  SEGMENT

     The  Company  has  no  separately  reportable  segments  in accordance with
Statement  of  Financial Accounting Standard ("SFAS") No. 131, "Disclosure About
Segments  of  an Enterprise and Related Information."  Under the enterprise wide
disclosure  requirements  of SFAS 131, the Company reports sales by each product
line.  Amounts  for  the  first nine months of 2004 and 2003 are as shown in the
table  below  (in  thousands).
<TABLE>
<CAPTION>


                      OCT. 1,   SEPT. 26,
                        2004       2003
                      --------  ----------
<S>                   <C>       <C>
Grain product line .  $146,737  $  116,037
Swine product line .    34,207      31,568
Poultry product line    47,401      39,628
                      --------  ----------
     Sales . . . . .  $228,345  $  187,233
                      ========  ==========
</TABLE>


     For  the  first  nine  months  of 2004 and 2003, sales in Brazil were $20.2
million  and $12.4 million, respectively.  Long-lived assets in Brazil were $3.9
million  at  October  1,  2004.


                                        7
<PAGE>

8.     GUARANTOR  SUBSIDIARIES

     The  Company's  payment  obligation under the senior subordinated notes are
fully  and  unconditionally  guaranteed  on  a  joint  and  several  basis  by
GSI/Cumberland  de  Mexico  S. de R.L. de C.V., The GSI Group (Europe) Ltd., The
GSI  Group Poland Sp. z.o.o. The GSI Group (Africa) (Pty) Ltd., GSI Group (Asia)
Sdn.  Bhd., Agromarau Industria e Comercio Ltda., The GSI Group (Shanghai) Ltd.,
and  The  GSI Group (Canada) Inc. (the "Guarantor Subsidiaries").  The Guarantor
Subsidiaries  are  direct  wholly  owned  subsidiaries  of  the  Company.  The
obligations  of  the  Guarantor  Subsidiaries  under  their  guarantees  are
subordinated  to  such  subsidiaries'  obligations  under their guarantee of the
Credit  Facility.

     Presented  below is unaudited condensed consolidating financial information
for  The  GSI Group, Inc. ("Parent Company") and the Guarantor Subsidiaries.  In
the  Company's  opinion,  separate  financial  statements  and other disclosures
concerning  the  Guarantor Subsidiaries would not provide additional information
that  is  material  to  investors.

     Investments  in  subsidiaries are accounted for by the Parent Company using
the  equity  method  of  accounting.  Earnings  of  subsidiaries are, therefore,
reflected  in  the  Parent  Company's  investments  in  and  advances  to/from
subsidiaries'  accounts  and  earnings.  The  elimination  entries  eliminate
investments  in  subsidiaries  and  intercompany  balances  and  transactions.

     During  July  2004,  the  Company dissolved the legal entity known as David
Manufacturing  Company (DMC).  The dissolution of DMC had no impact on earnings.
GSI  continues  to  sell  under  the  DMC  brand  name.


                                        8
<PAGE>

8.   GUARANTOR  SUBSIDIARIES  (CONTINUED)
<TABLE>
<CAPTION>

                               SUPPLEMENTAL CONDENSED CONSOLIDATING BALANCE SHEET
                                                OCTOBER 1, 2004
                                                 (IN THOUSANDS)


                                                       Parent      Guarantor
                                                       Company    Subsidiaries    Eliminations    Consolidated
                                                      ---------  --------------  --------------  --------------
<S>                                                   <C>        <C>             <C>             <C>
ASSETS
Current assets:
   Cash and cash equivalents . . . . . . . . . . . .  $     94   $       2,145   $          --   $       2,239
   Accounts receivable, net. . . . . . . . . . . . .    37,827           8,228          (3,829)         42,226
   Inventories, net. . . . . . . . . . . . . . . . .    42,077          10,278              --          52,355
   Other current assets. . . . . . . . . . . . . . .     2,840           2,963            (641)          5,162
                                                      ---------  --------------  --------------  --------------

Total current assets . . . . . . . . . . . . . . . .    82,838          23,614          (4,470)        101,982

Property, plant and equipment, net . . . . . . . . .    26,975           4,613              --          31,588
Goodwill and other intangible assets, net. . . . . .     8,534           3,241              --          11,775
Investment in and advances to/from subsidiaries. . .    32,752          (2,129)        (30,623)             --
Deferred taxes . . . . . . . . . . . . . . . . . . .        --           1,461              --           1,461
Other long-term assets . . . . . . . . . . . . . . .     2,716               2              --           2,718
                                                      ---------  --------------  --------------  --------------

Total assets . . . . . . . . . . . . . . . . . . . .  $153,815   $      30,802   $     (35,093)  $     149,524
                                                      =========  ==============  ==============  ==============
LIABILITIES AND STOCKHOLDERS' EQUITY(DEFICIT)
Current liabilities:
   Current portion of long-term debt . . . . . . . .  $  4,994   $         428   $          --   $       5,422
   Accounts payable. . . . . . . . . . . . . . . . .    13,082           8,312          (3,829)         17,565
   Accrued liabilities . . . . . . . . . . . . . . .    22,595           3,696            (641)         25,650
                                                      ---------  --------------  --------------  --------------

Total current liabilities. . . . . . . . . . . . . .    40,671          12,436          (4,470)         48,637

Long-term debt . . . . . . . . . . . . . . . . . . .   132,812           7,838          (7,838)        132,812
                                                      ---------  --------------  --------------  --------------

Total liabilities. . . . . . . . . . . . . . . . . .   173,483          20,274         (12,308)        181,449

Stockholders' equity (deficit):
   Common stock. . . . . . . . . . . . . . . . . . .        18          22,196         (22,196)             18
   Additional paid-in capital. . . . . . . . . . . .     3,006             505            (505)          3,006
   Accumulated other comprehensive loss. . . . . . .        --         (12,257)             --         (12,257)
   Retained earnings . . . . . . . . . . . . . . . .    18,867              84             (84)         18,867
   Treasury stock, at cost . . . . . . . . . . . . .   (41,559)             --              --         (41,559)
                                                      ---------  --------------  --------------  --------------

Total stockholders' equity (deficit) . . . . . . . .   (19,668)         10,528         (22,785)        (31,925)
                                                      ---------  --------------  --------------  --------------

Total liabilities and stockholders' equity (deficit)  $153,815   $      30,802   $     (35,093)  $     149,524
                                                      =========  ==============  ==============  ==============
</TABLE>




                                        9
<PAGE>


8.     GUARANTOR  SUBSIDIARIES  (CONTINUED)
<TABLE>
<CAPTION>

                         SUPPLEMENTAL CONDENSED CONSOLIDATING STATEMENT OF INCOME
                                THREE FISCAL MONTHS ENDED OCTOBER 1, 2004
                                              (IN THOUSANDS)


                                                 Parent      Guarantor
                                                 Company    Subsidiaries    Eliminations    Consolidated
                                                ---------  --------------  --------------  --------------
<S>                                             <C>        <C>             <C>             <C>
Sales. . . . . . . . . . . . . . . . . . . . .  $ 83,541   $       9,999   $      (3,684)  $      89,856
Cost of sales. . . . . . . . . . . . . . . . .    65,597           6,414          (3,696)         68,315
                                                ---------  --------------  --------------  --------------

Gross profit . . . . . . . . . . . . . . . . .    17,944           3,585              12          21,541

Selling, general and administrative expenses .     7,769           2,226              --           9,995
                                                ---------  --------------  --------------  --------------

Operating income . . . . . . . . . . . . . . .    10,175           1,359              12          11,546

Interest expense . . . . . . . . . . . . . . .    (3,883)            (57)             --          (3,940)
Other income (expense) . . . . . . . . . . . .      (825)              3              --            (822)
                                                ---------  --------------  --------------  --------------

Income before income taxes . . . . . . . . . .     5,467           1,305              12           6,784
(Benefit) provision for income taxes . . . . .      (183)            287              --             104
                                                ---------  --------------  --------------  --------------
Income before equity in income of
Consolidated subsidiaries. . . . . . . . . . .     5,650           1,018              12           6,680
Equity in income of consolidated subsidiaries.     1,018              --          (1,018)             --
                                                ---------  --------------  --------------  --------------

Net income . . . . . . . . . . . . . . . . . .  $  6,668   $       1,018   $      (1,006)  $       6,680
                                                =========  ==============  ==============  ==============
</TABLE>




                                       10
<PAGE>

8.     GUARANTOR  SUBSIDIARIES  (CONTINUED)
<TABLE>
<CAPTION>

                         SUPPLEMENTAL CONDENSED CONSOLIDATING STATEMENT OF INCOME
                                 NINE FISCAL MONTHS ENDED OCTOBER 1, 2004
                                              (IN THOUSANDS)


                                                 Parent      Guarantor
                                                 Company    Subsidiaries    Eliminations    Consolidated
                                                ---------  --------------  --------------  --------------
<S>                                             <C>        <C>             <C>             <C>
Sales. . . . . . . . . . . . . . . . . . . . .  $200,311   $      37,128   $      (9,094)  $     228,345
Cost of sales. . . . . . . . . . . . . . . . .   165,157          25,591          (9,094)        181,654
                                                ---------  --------------  --------------  --------------

Gross profit . . . . . . . . . . . . . . . . .    35,154          11,537              --          46,691

Selling, general and administrative expenses .    19,174           8,198              --          27,372
                                                ---------  --------------  --------------  --------------

Operating income . . . . . . . . . . . . . . .    15,980           3,339              --          19,319

Interest expense . . . . . . . . . . . . . . .   (10,379)            (75)             --         (10,454)
Other income (expense) . . . . . . . . . . . .    (1,376)             45              --          (1,331)
                                                ---------  --------------  --------------  --------------

Income before income taxes . . . . . . . . . .     4,225           3,309              --           7,534
(Benefit) provision for income taxes . . . . .      (188)            636              --             448
                                                ---------  --------------  --------------  --------------
Income before equity in income of
Consolidated subsidiaries. . . . . . . . . . .     4,413           2,673              --           7,086
Equity in income of consolidated subsidiaries.     2,673              --          (2,673)             --
                                                ---------  --------------  --------------  --------------

Net income . . . . . . . . . . . . . . . . . .  $  7,086   $       2,673   $      (2,673)  $       7,086
                                                =========  ==============  ==============  ==============
</TABLE>




                                       11
<PAGE>

8.     GUARANTOR  SUBSIDIARIES  (CONTINUED)
<TABLE>
<CAPTION>

                        SUPPLEMENTAL CONDENSED CONSOLIDATING STATEMENT OF INCOME
                              THREE FISCAL MONTHS ENDED SEPTEMBER 26, 2003
                                             (IN THOUSANDS)


                                                Parent      Guarantor
                                                Company    Subsidiaries    Eliminations    Consolidated
                                               ---------  --------------  --------------  --------------
<S>                                            <C>        <C>             <C>             <C>
Sales . . . . . . . . . . . . . . . . . . . .  $ 64,710   $      15,025   $      (2,465)  $      77,270
Cost of sales . . . . . . . . . . . . . . . .    50,134          12,343          (3,056)         59,421
                                               ---------  --------------  --------------  --------------

Gross profit. . . . . . . . . . . . . . . . .    14,576           2,682             591          17,849

Selling, general and administrative expenses.     7,920           2,240              --          10,160
                                               ---------  --------------  --------------  --------------

Operating income. . . . . . . . . . . . . . .     6,656             442             591           7,689

Interest expense. . . . . . . . . . . . . . .    (3,226)            (13)             --          (3,239)
Other income. . . . . . . . . . . . . . . . .        24              88              --             112
                                               ---------  --------------  --------------  --------------

Income before income taxes. . . . . . . . . .     3,454             517             591           4,562
Provision for income taxes. . . . . . . . . .        --             212              --             212
                                               ---------  --------------  --------------  --------------
Income before equity in income of
Consolidated subsidiaries . . . . . . . . . .     3,454             305             591           4,350
Equity in income of consolidated subsidiaries       305              --            (305)             --
                                               ---------  --------------  --------------  --------------

Net loss. . . . . . . . . . . . . . . . . . .  $  3,759   $         305   $         286   $       4,350
                                               =========  ==============  ==============  ==============
</TABLE>




                                       12
<PAGE>

8.     GUARANTOR  SUBSIDIARIES  (CONTINUED)
<TABLE>
<CAPTION>

                        SUPPLEMENTAL CONDENSED CONSOLIDATING STATEMENT OF INCOME
                               NINE FISCAL MONTHS ENDED SEPTEMBER 26, 2003
                                             (IN THOUSANDS)


                                                Parent      Guarantor
                                                Company    Subsidiaries    Eliminations    Consolidated
                                               ---------  --------------  --------------  --------------
<S>                                            <C>        <C>             <C>             <C>
Sales . . . . . . . . . . . . . . . . . . . .  $160,259   $      35,401   $      (8,427)  $     187,233
Cost of sales . . . . . . . . . . . . . . . .   127,305          28,171          (8,293)        147,183
                                               ---------  --------------  --------------  --------------

Gross profit. . . . . . . . . . . . . . . . .    32,954           7,230            (134)         40,050

Selling, general and administrative expenses.    20,203           8,130              --          28,333
                                               ---------  --------------  --------------  --------------

Operating income (loss) . . . . . . . . . . .    12,751            (900)           (134)         11,717

Interest expense. . . . . . . . . . . . . . .    (9,379)            (35)             --          (9,414)
Other expense . . . . . . . . . . . . . . . .      (447)            (86)             --            (533)
                                               ---------  --------------  --------------  --------------

Income (loss) before income taxes . . . . . .     2,925          (1,021)           (134)          1,770
Provision for income taxes. . . . . . . . . .         2             398              --             400
                                               ---------  --------------  --------------  --------------
Income (loss) before equity in income of
Consolidated subsidiaries . . . . . . . . . .     2,923          (1,419)           (134)          1,370
Equity in loss of consolidated subsidiaries .    (1,419)             --           1,419              --
                                               ---------  --------------  --------------  --------------

Net income (loss) . . . . . . . . . . . . . .  $  1,504   $      (1,419)  $       1,285   $       1,370
                                               =========  ==============  ==============  ==============
</TABLE>




                                       13
<PAGE>

8.     GUARANTOR  SUBSIDIARIES  (CONTINUED)
<TABLE>
<CAPTION>

                              SUPPLEMENTAL CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
                                       NINE FISCAL MONTHS ENDED OCTOBER 1, 2004
                                                    (IN THOUSANDS)



                                                               Parent      Guarantor
                                                               Company    Subsidiaries   Eliminations    Consolidated
                                                              ---------  --------------  -------------  --------------
<S>                                                           <C>        <C>             <C>            <C>
Cash flows provided by operating activities. . . . . . . . .  $  2,981   $       6,386   $          --  $       9,367
                                                              ---------  --------------  -------------  --------------

Cash flows from investing activities:
Capital expenditures and proceeds from sales of fixed assets    (1,128)         (1,417)             --         (2,545)
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . .     7,812          (7,819)             --             (7)
                                                              ---------  --------------  -------------  --------------

Net cash provided by (used in) investing activities. . . . .     6,684          (9,236)             --         (2,552)
                                                              ---------  --------------  -------------  --------------

Cash flows from financing activities:
Net payments on debt . . . . . . . . . . . . . . . . . . . .     7,619             788              --          8,407
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . .   (17,295)            855              --        (16,440)
                                                              ---------  --------------  -------------  --------------

Net cash provided by (used in) financing activities. . . . .    (9,676)          1,643              --         (8,033)
                                                              ---------  --------------  -------------  --------------

Effect of exchange rate changes on cash. . . . . . . . . . .        --              18              --             18
                                                              ---------  --------------  -------------  --------------

Change in cash and cash equivalents. . . . . . . . . . . . .       (11)         (1,189)             --         (1,200)

Cash and cash equivalents, beginning of period . . . . . . .       105           3,334              --          3,439
                                                              ---------  --------------  -------------  --------------

Cash and cash equivalents, end of period . . . . . . . . . .  $     94   $       2,145              --  $       2,239
                                                              =========  ==============  =============  ==============
</TABLE>




                                       14
<PAGE>

8.     GUARANTOR  SUBSIDIARIES  (CONTINUED)
<TABLE>
<CAPTION>

                              SUPPLEMENTAL CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
                                      NINE FISCAL MONTHS ENDED SEPTEMBER 26, 2003
                                                    (IN THOUSANDS)



                                                               Parent      Guarantor
                                                               Company    Subsidiaries   Eliminations    Consolidated
                                                              ---------  --------------  -------------  --------------
<S>                                                           <C>        <C>             <C>            <C>
Cash flows provided by operating activities. . . . . . . . .  $  2,236   $       4,381   $          --  $       6,617
                                                              ---------  --------------  -------------  --------------

Cash flows from investing activities:
Capital expenditures and proceeds from sales of fixed assets      (418)           (749)             --        (1, 167)
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . .     3,719          (2,227)             --          1,492
                                                              ---------  --------------  -------------  --------------

Net cash provided by (used in) investing activities. . . . .     3,301          (2,976)             --            325
                                                              ---------  --------------  -------------  --------------

Cash flows from financing activities:
Net payments on debt . . . . . . . . . . . . . . . . . . . .    (3,939)         (2,416)             --         (6,355)
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . .    (1,544)          1,071              --           (473)
                                                              ---------  --------------  -------------  --------------

Net cash used in financing activities. . . . . . . . . . . .    (5,483)         (1,345)             --         (6,828)
                                                              ---------  --------------  -------------  --------------

Effect of exchange rate changes on cash. . . . . . . . . . .        --             256              --            256
                                                              ---------  --------------  -------------  --------------

Change in cash and cash equivalents. . . . . . . . . . . . .        54             316              --            370

Cash and cash equivalents, beginning of period . . . . . . .       205           2,731              --          2,936
                                                              ---------  --------------  -------------  --------------

Cash and cash equivalents, end of period . . . . . . . . . .  $    259   $       3,047              --  $       3,306
                                                              =========  ==============  =============  ==============
</TABLE>




                                       15
<PAGE>

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

     The  following  discussion  of  the  financial  condition  and  results  of
operations  of  the  Company should be read in conjunction with the Consolidated
Financial  Statements  and  the  notes  included  in  Item  1  hereof.

GENERAL

     The  Company  is  a  leading  manufacturer  and  supplier  of  agricultural
equipment  and  services  worldwide.  The  Company's  grain,  swine  and poultry
products  are  used  by  producers  and purchasers of grain, and by producers of
swine  and  poultry. Fluctuations in grain and feed prices directly impact sales
of  the  Company's  grain equipment. Because the primary cost of producing swine
and  poultry  is the cost of the feed grain consumed by animals, fluctuations in
the  supply and cost of grain to users of the Company's products in the past has
impacted  sales  of  the  Company's  swine  and  poultry  equipment. The Company
believes,  however,  that its diversified product offerings mitigate some of the
effects  of  fluctuations  in  the  price  of  grain  since the demand for grain
storage,  drying  and  handling  equipment  tends  to increase during periods of
higher  grain prices, which somewhat offsets the reduction in demand during such
periods  for  the  Company's  products  by  producers  of  swine  and  poultry.

     Sales  of  agricultural  equipment are seasonal, with farmers traditionally
purchasing  grain  storage  bins  and grain drying and handling equipment in the
summer and fall in conjunction with the harvesting season, and swine and poultry
producers  purchasing equipment during prime construction periods in the spring,
summer  and fall.  The Company's net sales and net income have historically been
lower  during the first and fourth fiscal quarters as compared to the second and
third  quarters.

     Although  the Company's sales are primarily denominated in U.S. dollars and
are  not  generally  affected by currency fluctuations (except for the Company's
Brazilian  and  South  African operations), the production costs, profit margins
and competitive position of the Company are affected by the strength of the U.S.
dollar  relative  to  the  strength  of  the  currencies  in countries where its
products  are  sold.

     The Company's international sales have historically comprised a significant
portion  of  net  sales.  In  the  first  nine months of both 2004 and 2003, the
Company's  international  sales  accounted for 26% of net sales.   International
operations  generally  are  subject  to  various  risks  that are not present in
domestic  operations,  including  restrictions  on  dividends,  restrictions  on
repatriation  of  funds, unexpected changes in tariffs and other trade barriers,
difficulties in staffing and managing foreign operations, political instability,
fluctuations  in  currency  exchange  rates, reduced protection for intellectual
property  rights in some countries, seasonal reductions in business activity and
potentially  adverse  tax  consequences, any of which could adversely impact the
Company's  international  operations.

     The  primary  raw materials used by the Company to manufacture its products
are  steel and polymers.  Fluctuations in the prices and availability of vendors
for  steel  and,  to a lesser extent, polymer materials can impact the Company's
cost  of  sales.   Recent  sharp increases in the price of steel have forced the
Company  to pass along price increases to its customers, which may affect future
demand.  In  addition,  the  Company may be unable to recover the full amount of
these  steel  price  increases  from  its  customers.

     On  July 1, 2004, Craig Sloan retired as the Chief Executive Officer of The
GSI  Group,  Inc.  (the  "Company").  On July 8, 2004, Mr. Sloan and the Company
entered  into  a  Severance,  Non-Compete and Consulting Agreement providing the
terms  and  conditions  of  Mr. Sloan's retirement and establishing a three-year
period (subject to extension) during which Mr. Sloan will act as a consultant to
the  Company. Pursuant to that agreement, the Company also repurchased a portion
of  Mr.  Sloan's common stock. Mr. Sloan is continuing to serve as a director of
the  Company  and  as  the non-executive Chairman of the Board. Upon Mr. Sloan's
retirement,  the  Board of Directors elected Russell C. Mello as Chief Executive
Officer  of  the  Company.

     The  Company  currently  operates  as  a  subchapter  S  corporation  and,
accordingly, is not subject to federal income taxation for the periods for which
financial  information  has  been  presented  herein.  Because  the  Company's
stockholders  are  subject  to tax liabilities based on their pro rata shares of
the  Company's income, the Company's policy is to make periodic distributions to
its  stockholders  in  amounts  equal  to  such  tax  liabilities.

                                       16
<PAGE>

RESULTS  OF  OPERATIONS

Three  Months Ended October 1, 2004 Compared to Three Months Ended September 26,
2003

     Sales  increased  16.3%  or  $12.6  million  to  $89.9 million in the third
quarter  of  2004  compared to $77.3 million in the third quarter of 2003.  This
increase  was  driven  by  increased  demand for the Company's grain and poultry
products.

     Gross  profit  increased  to  $21.5 million in the third quarter of 2004 or
24.0%  of sales from $17.8 million or 23.0% of sales in the same period of 2003.
This  increase  was  primarily  a  result  of  increased  sales.

     Operating  expenses  decreased 1.6% or $0.2 million to $10.0 million in the
third  quarter  of  2004  from  $10.2  million  in the same period of 2003. This
decrease  was  primarily  the  result  of  cost  cutting  measures.

     Operating  income  increased  to $11.5 million in the third quarter of 2004
from  $7.7  million  in  the third quarter of 2003.  This increase was primarily
attributable  to  the  increase  in  gross  profit.

     Interest  expense  increased  $0.7  million in the third quarter of 2004 as
compared  to  the  third  quarter  of  2003  due  to  higher  borrowing  costs.

     Net  income increased $2.3 million to $6.7 million for the third quarter of
2004  from  $4.4  million  in  the  same  period  of  2003.

Nine  Months  Ended  October 1, 2004 Compared to Nine Months Ended September 26,
2003

     Sales  increased 22.0% or $41.1 million to $228.3 million in the first nine
months  of  2004  compared  to  $187.2 million in the first nine months of 2003.
This  increase  was  driven  by  increased  demand  for  essentially  all of the
Company's  products.

     Gross profit increased to $46.7 million in the first nine months of 2004 or
20.5%  of sales from $40.1 million or 21.4% of sales in the same period of 2003.
This  increase was a result of increased sales.  The decrease in gross profit as
a  percent  of  sales  was  primarily  the  result  of  higher  material  costs.

     Operating  expenses  decreased 3.4% or $0.9 million to $27.4 million in the
first  nine  months  of 2004 from $28.3 million in the same period of 2003. This
decrease  was  primarily  the  result  of  cost  cutting  measures.

     Operating income increased substantially to $19.3 million in the first nine
months  of  2004  from  $11.7  million  in  the first nine months of 2003.  This
increase  was  primarily  attributable  to  the  increase  in  gross  profit.

     Interest expense increased $1.0 million in the first nine months of 2004 as
compared  to  the  first  nine  months  of  2003  due to higher borrowing costs.

     Net income increased $5.7 million to $7.1 million for the first nine months
of  2004  from  $1.4  million  in  the  same  period  of  2003.

LIQUIDITY  AND  CAPITAL  RESOURCES

     The  Company  has historically funded capital expenditures, working capital
requirements,  debt  service,  stockholder  dividends and stock repurchases from
cash flow from its operations, augmented by borrowings made under various credit
agreements  and  the  sale  of  the  Company's  10  % senior subordinated notes.

     As  of October 1, 2004, the Company had $53.3 million of working capital, a
decrease  of  $4.0  million  from  working capital as of December 31, 2003.  The
decrease  in working capital was primarily due to increases in accrued expenses,
current  maturities  of  long-term  debt, and accounts payable of $13.9 million,
partially  offset  by  increases  in  accounts receivable and decreases in cash,
prepaids,  and  inventory  of  $9.9  million.

     Operating activities provided $9.4 million and $6.6 million in cash flow in
the  first  nine  months  of  2004  and  2003,  respectively.  This $2.8 million
increase  in  cash  flow  was primarily the result of an increase in net income,
accounts  receivable,  other  current  assets,  accrued  expenses,  and customer
deposits  of  $16.6  million, partially offset by a decrease in depreciation and
amortization,  accounts  payable,  deferred taxes and inventory of $14.5 million
compared  to  the  first  nine  months  of  2003.

     Investing activities used $2.6 million and $0.3 million in cash flow in the
first  nine  months of 2004 and 2003, respectively.  The cash was used primarily
for  machinery  and equipment purchases.  The $2.9 million decrease in cash used
in  investing activities was partially a result of higher proceeds from the sale
of  fixed  assets  in  2003  compared  to  2004.
                                       17
<PAGE>

     Financing activities used $8.0 million and $6.8 million in cash flow in the
first  nine  months of 2004 and 2003, respectively.  The cash was used primarily
for the purchase of treasury stock in 2004 and for payments on long-term debt in
2003.

     The  Company  believes  that  existing  cash, cash flow from operations and
available borrowings under the Credit Facility will be sufficient to support its
working  capital,  capital  expenditures  and  debt service requirements for the
foreseeable  future.

INFLATION

     The  Company  believes  that inflation has not had a material effect on its
results  of  operations  or  financial  condition  during  recent  periods.

CRITICAL  ACCOUNTING  POLICIES

     There  are  no  material  changes to the critical accounting policies since
December  31,  2003.

FORWARD-LOOKING  STATEMENTS

     Certain  statements  contained  in  this  report  are  "forward-looking
statements"  within the meaning of Section 27A of the Securities Act of 1933, as
amended,  and  Section  21E  of the Securities Exchange Act of 1934, as amended.
Forward-looking  statements  are statements other than historical information or
statements  of  current  condition.  Some  forward-looking  statements  may  be
identified  by the use of terms such as "believes," "anticipates," "intends," or
"expects."  Forward-looking  statements  are subject to risks, uncertainties and
other  factors  that could cause actual results to differ materially from future
results  expressed or implied by such statements, and such statements should not
be  regarded  as  a  representation  the  stated  objectives  will  be achieved.



                                       18
<PAGE>

ITEM  3.  QUANTITATIVE  AND  QUALITATIVE  DISCLOSURES  ABOUT  MARKET  RISK

     The  Company  is  subject to market risk associated with adverse changes in
interest  rates  and foreign currency exchange rates.  The Company does not hold
any market risk sensitive instruments for trading purposes.  At October 1, 2004,
principal exposed to interest rate risk was limited to $38.3 million in variable
rate  debt.  The  Company  measures its interest rate risk by estimating the net
amount  by which potential future net earnings would be impacted by hypothetical
changes  in  market interest rates related to all interest rate sensitive assets
and liabilities.  A 1% change in interest rates would have a $0.4 million impact
on  the  Company's  results  of  operations.

     At  October  1,  2004,  approximately  16.2%  of  sales  were  derived from
international  operations  with exposure to foreign currency exchange rate risk.
The  Company  mitigates  its  foreign currency exchange rate risk principally by
establishing  local  production  facilities  in  the  markets  it  serves and by
invoicing  customers  in  the  same currency as the source of the products.  The
Company  also  monitors  its  foreign  currency  exposure  in  each  country and
implements  strategies  to  respond  to  changing  economic  and  political
environments.  The  Company's  exposure  to  foreign currency exchange rate risk
relates primarily to the financial position and the results of operations of its
Brazilian  and  South  African  subsidiaries.  The  Company's  exposure  to such
exchange rate risk as it relates to the Company's financial position and results
of  operations  would  be  adversely  impacted  by  further  devaluation  of the
Brazilian  Real  per  U.S.  dollar  and  the South African Rand per U.S. dollar.
These  amounts  are  difficult to accurately estimate due to factors such as the
inherent  fluctuation  of inter-company account balances, balance sheet accounts
and  the  existing  economic  uncertainty  and future economic conditions in the
international  marketplace.


ITEM  4.  CONTROLS  AND  PROCEDURES

          The  Company  maintains a system of disclosure controls and procedures
which  are  designed  to ensure that information required to be disclosed by the
Company  in  the  reports  filed  under  the  Securities Exchange Act of 1934 is
recorded,  processed,  summarized and reported within the time periods specified
under the SEC's rules and forms.  Based on an evaluation performed as of the end
of  the period covered by this report, the Company's Chief Executive Officer and
Principal  Accounting  Officer  have  concluded that the disclosure controls and
procedures  were effective to provide reasonable assurance of the achievement of
this  objective.

     There  were  no  changes  in the Company's internal controls over financial
reporting  identified  in  the  evaluation that have materially affected, or are
reasonably  likely  to  materially  affect, the Company's internal controls over
financial  reporting.



                                       19
<PAGE>



                                     PART II
                                OTHER INFORMATION

ITEM  1.  LEGAL  PROCEEDINGS.

     There  are  no legal proceedings pending against the Company, which, in the
opinion  of  management,  would  have a material adverse affect on the Company's
business,  financial  position  or  results  of  operations.


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

     (a)  EXHIBITS:

           A  list  of  the  exhibits  included as part of this Form 10-Q is set
forth in the Index to Exhibits that immediately precedes such exhibits, which is
incorporated  herein  by  reference.

(b)     REPORTS  ON  FORM  8-K:

          The  Company  did  not file any Current Reports on Form 8-K during its
fiscal  quarter  ended  October  1,  2004.

                                       20
<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.

                                   The  GSI  Group,  Inc.

                                   By:     /s/  Ann  Montgomery
                                           --------------------
                                         Vice  President  -  Finance  (Principal
Accounting  Officer)


                            DATE:  NOVEMBER 8, 2004


                                       21
<PAGE>


                                INDEX TO EXHIBITS


EXHIBIT
 NO.                            DOCUMENT DESCRIPTION
 ---                            --------------------


10.11   Amendment No. 2 and Limited Waiver to the October 31, 2003 Loan and
        Security Agreement, dated October 19, 2004, between The GSI Group,
        Inc., as borrower, and Congress Financial Corporation, as lender.

31.1    Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer.

31.2    Rule 13a-14(a)/15d-14(a) Certification of Principal Accounting Officer.

32      Section  1350  Certification  of  Chief  Executive Officer and Principal
        Accounting  Officer.






                                       22
<PAGE>