`UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D. C. 20549




                                   FORM 10-Q

(Mark one)
[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934 For the quarterly period ended March 31, 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 0-19824
                                                -------

                      Nutrition Management Services Company
                      -------------------------------------
             (Exact name of registrant as specified in its charter)

      Pennsylvania                                       23-2095332
--------------------------------------------------------------------------------
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
incorporation or organization)

  Box 725, Kimberton Road, Kimberton, PA                 19442
--------------------------------------------------------------------------------
  (Address of principal executive offices)            (Zip Code)

Registrant's telephone number, including area code (610) 935-2050
                                                   -----------------------------
                                                                             N/A
--------------------------------------------------------------------------------
Former name, former address and former fiscal year, if change since last report.

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  Registrant  was
required  to file  such  report),  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 Exchange Act Rule 12b-2). Yes      No X
                                        ---     ---

2,747,000  Shares of Registrant's  Class A Common Stock,  with no par value, and
100,000  shares of  Registrant's  Class B Common Stock,  with no par value,  are
outstanding as of May 20, 2003.





                                TABLE OF CONTENTS


Part I.   Financial Information                                        Page No.
          ---------------------                                        ---------

          Consolidated Balance Sheets as of
          March 31, 2003 (unaudited) and June 30, 2002                    2

          Consolidated Statements of Operations for the
          Three and Nine Months Ended March 31, 2003 and
          2002 (unaudited)                                                3

          Consolidated Statements of Cash Flows for the
          Nine Months Ended March 31, 2003
          and 2002 (unaudited)                                            4

          Notes to Consolidated Financial Statements                   6-11

          Management's Discussion and Analysis of Financial
          Condition and Results of Operations                         12-15

          Item 4 - Controls and Procedures                               16

Part II.  Other Information                                              17

          Signatures                                                     18

                                       -1-




                      NUTRITION MANAGEMENT SERVICES COMPANY

                           CONSOLIDATED BALANCE SHEETS

                                     ASSETS


                                                                     March 31,                June 30,
                                                                       2003                     2002
                                                                  -----------               -----------
                                                                  (unaudited)

Current assets:
   Cash and cash equivalents                                      $   819,269               $   593,310
   Accounts receivable, net of allowance for doubtful
   accounts of $2,181,326  and $1,774,753, respectively             4,123,964                 5,659,990
   Notes Receivable                                                    11,545                         0
   Unbilled Revenue                                                   187,171                    46,505
   Deferred income taxes                                                    0                   882,487
   Inventory                                                          158,155                   230,238
   Prepaid and other                                                  427,796                   289,079
                                                                  -----------               -----------

Total current assets                                                5,727,900                 7,701,609
                                                                  -----------               -----------

Property and equipment, net                                         8,258,685                 8,683,712
                                                                  -----------               -----------


Other assets:
   Investment in contracts                                                  0                   120,000
   Notes Receivable                                                   138,330                         0
   Advances to employees                                              437,126                   523,490
   Deferred income taxes                                              985,576                   103,089
   Bond issue costs                                                   199,071                   210,096
   Deferred costs and other assets                                     10,021                    10,020
                                                                  -----------               -----------

Total other assets                                                  1,770,124                   966,695
                                                                  -----------               -----------
                                                                  $15,756,709               $17,352,016
                                                                  ===========               ===========


            SEE NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

                                     -2-




                      NUTRITION MANAGEMENT SERVICES COMPANY

                           CONSOLIDATED BALANCE SHEETS

                      LIABILITIES AND STOCKHOLDERS' EQUITY

                                                                                 March 31,          June 30,
                                                                                   2003               2002
                                                                                ------------      ------------
                                                                                (unaudited)
Current liabilities:
     Current portion of long-term debt                                          $    191,813      $    191,814
     Accounts payable                                                              4,180,831         3,811,110
     Accrued expenses                                                                270,950           443,483
     Accrued payroll and related expenses                                            298,483           260,861
     Other                                                                            71,903            71,192
                                                                                ------------      ------------

Total current liabilities                                                          5,013,980         4,778,460
                                                                                ------------      ------------

Long-Term liabilities:
    Long-term debt, net of current portion                                         5,207,093         5,543,852
    Long Term Note Payable                                                             - 0 -           730,146
                                                                                ------------      ------------

Total long-term liabilities                                                        5,207,093         6,273,998
                                                                                ------------      ------------
Stockholders' equity:
    Undesignated preferred stock - no par, 2,000,000 shares authorized, none
            issued or outstanding                                                         --                --

     Common stock:
     Class A - no par, 10,000,000 shares authorized; 3,000,000 issued and
               2,747,000 outstanding, respectively                                 3,801,926         3,801,926
     Class B - no par, 100,000 shares authorized, issued and outstanding                  48                48
     Retained earnings                                                             2,233,225         2,997,147
                                                                                ------------      ------------
                                                                                   6,035,199         6,799,121


     Less:  treasury stock (Class A common: 253,000 shares) - at cost               (499,563)         (499,563)
                                                                                ------------      ------------

Total stockholders' equity                                                         5,535,636         6,299,558
                                                                                ------------      ------------
                                                                                $ 15,756,709      $ 17,352,016
                                                                                ============      ============


            SEE NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

                                       -3-




                      NUTRITION MANAGEMENT SERVICES COMPANY

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)

                                                               Three months ended                 Nine months ended
                                                                     March 31,                         March 31,
                                                             2003             2002             2003               2002
                                                       ------------      ------------      ------------      ------------
Food Service Revenue                                   $  6,358,301      $  6,945,186      $ 20,781,354      $ 22,239,227

Cost of operations
     Payroll and related expenses                         2,645,415         2,351,595         8,266,690         7,258,545
     Other costs of operations                            2,615,696         3,123,867         8,887,074        10,299,564
                                                       ------------      ------------      ------------      ------------
          Cost of operations                              5,261,111         5,475,462        17,153,764        17,558,109
                                                       ------------      ------------      ------------      ------------

Gross profit                                              1,097,190         1,469,724         3,627,590         4,681,118
                                                       ------------      ------------      ------------      ------------

Expenses
     General and administrative expenses                  1,071,604         1,064,830         3,332,037         3,438,356
     Depreciation and amortization                          201,808           210,827           615,614           633,221
     Provision for doubtful accounts                         85,999           225,000           278,261           675,000
                                                       ------------      ------------      ------------      ------------
          Expenses                                        1,359,411         1,500,657         4,225,912         4,746,577
                                                       ------------      ------------      ------------      ------------

(Loss) from operations                                     (262,221)          (30,933)         (598,322)          (65,459)
                                                       ------------      ------------      ------------      ------------

Other (expense) income
     Other                                                   (4,508)            2,545           (25,137)          (19,674)
     Interest income                                          3,832             1,702             7,859             7,165
     Interest expense                                       (43,862)          (53,088)         (148,321)         (213,369)
                                                       ------------      ------------      ------------      ------------
          Other (expense) income - net                      (44,538)          (48,841)         (165,599)         (225,878)
                                                       ------------      ------------      ------------      ------------

 (Loss) before income taxes                                (306,759)          (79,774)         (763,921)         (291,337)

Provision for income taxes                                        0                 0                 0                 0
                                                       ------------      ------------      ------------      ------------


Net Loss                                               $   (306,759)          (79,774)     $   (763,921)     $   (291,337)
                                                       ============       ============      ============      ============


Basic and diluted loss

      - basic and diluted                            $         (.11)     $       (.03)     $       (.27)     $       (.10)
                                                       ============       ============      ============      ============


Weighted average number of shares                         2,847,000         2,847,000         2,847,000         2,847,000
                                                       ============       ============      ============      ============

            SEE NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

                                       -4-




                      NUTRITION MANAGEMENT SERVICES COMPANY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
                                                                                            Nine Months Ended
                                                                                                March 31,

                                                                                          2003                   2002
                                                                                      ---------               --------

Operating activities:
Net (Loss)                                                                         ($  763,921)           ($  291,337)
Adjustments to reconcile net (loss) to net cash provided by/(used in)
operating activities:
     Depreciation and amortization                                                     615,614                633,221
     Provision for bad debts                                                           278,261                675,000
     Amortization of bond costs                                                         10,923                 10,825

Changes in assets and liabilities:
     Accounts receivable                                                             1,257,765                339,968
     Notes Receivable                                                                 (149,875)
     Unbilled Revenue                                                                 (140,666)                94,900
     Inventory and other                                                                72,083                (30,345)
     Accounts payable                                                                 (276,169)              (707,554)
     Accrued expenses                                                                 (146,451)               (36,056)
     Accrued payroll and related expenses                                               37,622                  6,844
     Accrued professional                                                              (26,083)                15,725
     Accrued incomes taxes                                                              (9,691)                (7,217)
     Other                                                                            (128,213)               (30,925)
                                                                                      ---------               --------
Net cash provided by operating activities                                              631,198                673,049
                                                                                      ---------               --------
Investing activities:
     Repayment (Advances) to employees                                                  86,363               (147,763)
     Purchase of property and equipment                                                (70,587)              (218,450)
                                                                                      ---------               --------
     Net cash provided by / (used in) investing activities                              15,776               (366,213)
                                                                                      ---------               --------
Financing activities
     Repayments of long-term borrowing                                              (1,386,900)              (922,000)
     Repayments of long-term payable                                                   (84,247)              (252,741)
     Repayments of term loan                                                           (49,768)               (46,316)
     Proceeds from long term borrowing                                               1,099,900              1,087,000
                                                                                      ---------               --------
Net cash (used in)  financing activities                                              (421,015)              (134,057)
                                                                                      ---------               --------

 Net increase in cash                                                                  225,959                172,779
                                                                                      ---------               --------

Cash and cash equivalents - beginning of period                                        593,310                451,875
                                                                                      ---------               --------

Cash and cash equivalents - end of period                                          $   819,269            $   624,654
                                                                                      =========               ========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
CASH PAID DURING THE PERIOD FOR:
     Interest                                                                      $   152,393            $   221,570
     Income taxes                                                                  $   (15,644)           $    20,452


            See Notes to Unaudited Consolidated Financial Statements

                                       -5-




                      NUTRITION MANAGEMENT SERVICES COMPANY

              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

                                 MARCH 31, 2003

1.      BASIS OF PRESENTATION

        The  accompanying   unaudited  consolidated  financial  statements  were
        prepared in accordance with generally accepted accounting principles for
        interim  financial  information for quarterly  reports on Form 10-Q and,
        therefore,  do not include all of the information and footnotes required
        by generally  accepted  accounting  principles  for  complete  financial
        statements.  However, all adjustments that, in the opinion of management
        are necessary for fair  presentation of the financial  statements,  have
        been  included.  The  results  of  operations  for the  interim  periods
        presented  are not  necessarily  indicative  of the results  that may be
        expected for the entire fiscal year ending June 30, 2003.  The financial
        information  presented  should be read in conjunction with the Company's
        financial statements that were filed under Form 10-K.

2.      NEW ACCOUNTING PRONOUNCEMENTS

        In August 2001, the Financial  Accounting  Standards  Board (the "FASB")
        issued SFAS 143, Accounting for Asset Retirement  Obligations.  SFAS 143
        applies to all entities,  including  rate-regulated  entities, that have
        legal   obligations   associated  with  the  retirement  of  a  tangible
        long-lived   asset  that  result  from   acquisition,   construction  or
        development  and (or) normal  operations of the  long-lived  asset.  The
        application  of this  Statement  is not  limited to certain  specialized
        industries,  such as the extractive or nuclear  industries.  A liability
        for  an  asset  retirement   obligation  should  be  recognized  if  the
        obligation  meets the  definition  of a liability  and can be reasonably
        estimated.  The initial  recording should be at fair value.  SFAS 143 is
        effective for  financial  statements  issued for fiscal years  beginning
        after June 15, 2002, with earlier application encouraged. The provisions
        of the  Statement  have  not  had a  material  impact  on the  financial
        condition or results of operations of the Company.

        In August 2001, the FASB issued SFAS 144,  Accounting for the Impairment
        or  Disposal  of  Long-Lived  Assets.  SFAS  144  retains  the  existing
        requirements  to  recognize  and measure the  impairment  of  long-lived
        assets to be held and used or to be disposed of by sale.  However,  SFAS
        144 makes changes to the scope and certain  measurement  requirements of
        existing  accounting  guidance.  SFAS 144 also changes the  requirements
        relating to reporting the effects of a disposal or  discontinuation of a
        segment of a business.  SFAS 144 is effective for  financial  statements
        issued for fiscal years  beginning  after  December 15, 2001 and interim
        periods  within those fiscal years.  The adoption of this  Statement did
        not have a significant  impact on the financial  condition or results of
        operations of the Company.

        In April 2002,  Statement of  Financial  Accounting  Standards  No. 145,
        "Rescission of FASB  Statements No. 4, 44 and 64,  Amendment of FASB No.
        13, and Technical  Corrections" (SFAS No. 145) was issued. This standard
        changes  the  accounting  principles  governing   extraordinary


                                      -6-




                      NUTRITION MANAGEMENT SERVICES COMPANY

        NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (continued)

                                 MARCH 31, 2003

        items by, among other things,  providing  more  definitive  criteria for
        extraordinary  items by  clarifying  and, to some extent,  modifying the
        existing   definition   and   criteria,    specifying   disclosure   for
        extraordinary  items and specifying  disclosure  requirements  for other
        unusual or infrequently  occurring events and transactions  that are not
        extraordinary  items.  SFAS 145 is effective  for  financial  statements
        issued for  fiscal  years  beginning  after  June 15,  2002,  with early
        adoption  encouraged.  The  adoption  of this  Statement  did not have a
        significant  impact on the financial  condition or results of operations
        of the Company.

        In July  2002,  the FASB  issued  SFAS No.  146,  "Accounting  for Costs
        Associated  with  Exit or  Disposal  Activities"  (SFAS  146).  SFAS 146
        requires  companies to recognize costs  associated with exit or disposal
        activities  when  they  are  incurred  rather  than  at  the  date  of a
        commitment  to  an  exit  or  disposal  plan.   SFAS  146  is  effective
        prospectively for exit and disposal activities  initiated after December
        31,  2002.  The Company  does not  anticipate  that the adoption of this
        Statement will have a significant  impact on the financial  condition or
        results of operations of the Company.

        In December 2002, the FASB issued SFAS 148,  "Accounting for Stock-Based
        Compensation  -  Transition  and  Disclosure".  SFAS 148 amends SFAS 123
        "Accounting  for  Stock-Based   Compensation,"  to  provide  alternative
        methods of  transition  for a  voluntary  change to the fair value based
        method of accounting for stock-based employee compensation. In addition,
        SFAS 148  amends  the  disclosure  requirements  of SFAS 123 to  require
        prominent  disclosures in both annual and interim  financial  statements
        about the method of accounting for stock-based employee compensation and
        the effect of the method used on reported results. SFAS 148 is effective
        for fiscal years  beginning after December 15, 2002. The expanded annual
        disclosure  requirements and the transition provisions are effective for
        fiscal  years ending after  December  15, 2002.  The interim  disclosure
        provisions  are  effective for financial  reports  containing  financial
        statements  for interim  periods  beginning  after  December  15,  2002.
        Management  does not expect the  adoption of SFAS 148 to have a material
        effect on the Company's  financial position,  results of operations,  or
        cash flows.

3.      EARNINGS PER COMMON SHARE

        Earnings  per common  share  amounts  are based on the  weighted-average
        number of shares of common stock  outstanding  during the three and nine
        month periods ending March 31, 2003 and 2002. Stock options and warrants
        did  not  impact   earnings   per  share   each   period  as  they  were
        anti-dilutive.

                                      -7-




                      NUTRITION MANAGEMENT SERVICES COMPANY

        NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (continued)

                                 MARCH 31, 2003

4.     LITIGATION

        On February  7, 2001,  NMSC filed a suit  against a major  client in the
        Court of Common Pleas in Chester County,  PA. This suit has subsequently
        been  removed  to the  United  States  District  Court  for the  Eastern
        District of Pennsylvania.  In the lawsuit, NMSC has made various claims,
        including   among  others  a  claim  that  the  client   failed  to  pay
        approximately  $2.1 million in invoiced amounts, a claim that the client
        failed to pay  approximately  $1 million in other amounts owing, a claim
        for reimbursement for start up costs in an amount in excess of $400,000,
        a claim for over $2 million in lost profits (or, alternatively,  a claim
        for  reimbursement  for over $300,000 in credits  issued in exchange for
        the promise to extend the arrangement),  a claim in the nature of treble
        damages  and  counsel  fees,  and other  claims.  The client has filed a
        counterclaim  which the  Company is  contesting  as part of the  overall
        proceedings.

        In addition to the litigation described above, the Company is exposed to
        asserted  and  unasserted  claims.  In the  opinion of  management,  the
        resolution of these matters will not have a material  adverse  effect on
        the Company's financial position, results of operations or cash flows.

5.      BUSINESS SEGMENTS

        The  Company  follows  the  disclosure   provisions  of  SFAS  No.  131,
        Disclosures  about  Segments of an Enterprise  and Related  Information.
        This management approach focuses on internal financial  information that
        is  used by  management  to  assess  performance  and to make  operating
        decisions.  SFAS  No.  131 also  requires  disclosures  about  products,
        services,  geographic  areas, and major customers.  The adoption of SFAS
        No.  131  had no  effect  on the  Company's  results  of  operations  or
        financial position.

        The Company's  reportable  segments are (1) food service  management and
        (2)  training  and  conference   center.  The  Company  reports  segment
        performance  on an after tax basis.  Deferred taxes are not allocated to
        segments.  The management  accounting policies and processes utilized in
        compiling  segment  financial  information  are highly  subjective  and,
        unlike financial  accounting,  are not based on  authoritative  guidance
        similar to accounting principals generally accepted in the United States
        of America.  As a result,  reported  segment results are not necessarily
        comparable with similar information reported by other similar companies.

                                      - 8 -




                      NUTRITION MANAGEMENT SERVICES COMPANY

        NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (continued)

                                 MARCH 31, 2003



 5.  BUSINESS SEGMENTS - CONTINUED

                                              Food Service          Training and
                                              Management            Conference Center              Total
                                              ----------            -----------------              -----

For the quarter ended Mar. 31, 2003:
  Food service revenue                        $  6,212,344             $    145,957             $  6,358,301
  Depreciation and amortization                     73,927                  127,881                  201,808
  Income (loss) from operations                    157,066                 (419,287)                (262,221)
  Interest income                                    3,832                        0                    3,832
  Interest expense                                 (25,146)                 (18,716)                 (43,862)
  Income (loss) before taxes (benefit)             135,752                 (442,511)                (306,759)
  Net income (loss)                                135,752                 (442,511)                (306,759)
  Total assets                                   7,280,692                8,476,017               15,756,709


                                              Food Service          Training and
                                              Management            Conference Center               Total
                                              ----------            -----------------               -----

For the quarter ended Mar. 31, 2002:
  Food service revenue                        $  6,681,838             $    263,348            $   6,945,186
  Depreciation and amortization                     76,947                  133,880                  210,827
  Income (loss) from operations                    256,900                 (287,833)                 (30,933)
  Interest income                                    1,702                        0                    1,702
  Interest expense                                 (30,276)                 (22,812)                 (53,088)
  Income (loss) before taxes (benefit)             225,662                 (305,436)                 (79,774)
  Net income (loss)                                225,662                 (305,436)                 (79,774)
  Total assets                                   8,401,295                8,909,814               17,311,109

                                      - 9 -




                      NUTRITION MANAGEMENT SERVICES COMPANY

        NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (continued)

                                 MARCH 31, 2003

  5.  BUSINESS SEGMENTS - CONTINUED

                                                        Food Service         Training and
                                                        Management           Conference Center             Total
                                                        ----------           -----------------             -----

For the nine months ended Mar. 31, 2003:
  Food service revenue                                 $ 20,168,296            $    613,058            $ 20,781,354
  Depreciation and amortization                             223,163                 392,451                 615,614
  Income (loss) from operations                             577,349              (1,175,671)               (598,322)
  Interest income                                             7,859                       0                   7,859
  Interest expense                                          (85,768)                (62,553)               (148,321)
  Income (loss) before taxes (benefit)                      487,828              (1,251,749)               (763,921)
  Net income (loss)                                         487,828              (1,251,749)               (763,921)
  Total assets                                            7,280,692               8,476,017              15,756,709



                                                        Food Service         Training and
                                                        Management           Conference Center             Total
                                                        ----------           -----------------             -----
For the nine months ended Mar. 31, 2002:
  Food service revenue                                 $ 21,590,221            $    649,006            $ 22,239,227
  Depreciation and amortization                             246,126                 387,095                 633,221
  Income (loss) from operations                             862,719                (928,180)                (65,459)
  Interest income                                             7,165                       0                   7,165
  Interest expense                                         (116,055)                (97,314)               (213,369)
  Income (loss) before taxes (benefit)                      745,837              (1,037,174)               (291,337)
  Net income (loss)                                         745,837              (1,037,174)               (291,337)
  Total assets                                            8,401,295               8,909,814              17,311,109


                                      -10-



                      NUTRITION MANAGEMENT SERVICES COMPANY

        NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (continued)

                                 MARCH 31, 2003

6.      STOCK-BASED COMPENSATION

        The Company  accounts for stock options  under SFAS No. 123,  ACCOUNTING
        FOR STOCK-BASED COMPENSATION, as amended by SFAS No. 148, which contains
        a fair  value-based  method for valuing  stock-based  compensation  that
        entities may use,  which  measures  compensation  cost at the grant date
        based on the fair value of the award.  Compensation  is then  recognized
        over  the  service   period,   which  is  usually  the  vesting  period.
        Alternatively,  SFAS No. 123 permits entities to continue accounting for
        employee stock options and similar equity  instruments  under Accounting
        Principles  Board  (APB)  Opinion  25,  ACCOUNTING  FOR STOCK  ISSUED TO
        EMPLOYEES. Entities that continue to account for stock options using APB
        Opinion 25 are required to make pro forma  disclosures of net income and
        earnings  per share,  as if the fair  value-based  method of  accounting
        defined in SFAS No. 123 had been applied.

        The Company  accounts for its plan under the recognition and measurement
        principles of APB No. 25, Accounting for Stock Issued to Employees,  and
        related interpretations. Stock-based employee compensation costs are not
        reflected  in net loss,  as all  options  granted  under the plan had an
        exercise price equal to the market value of the underlying  common stock
        on the date of grant. The following table  illustrates the effect on net
        loss and loss  per  share if the  Company  had  applied  the fair  value
        recognition   provisions  of  SFAS  No.  123,  to  stock-based  employee
        compensation.

                                                    Three months ended                   Nine months ended
                                                        March 31,                            March 31,
                                                     2003           2002                2003              2002
                                                     ----           ----                ----              ----

            Net loss:
                   As reported                     ($306,759)    ($79,774)           ($763,921)         ($291,337)
                   Pro forma                       ($306,759)    ($79,774)           ($763,921)         ($291,337)

            Diluted loss per share:
                   As reported                      $ (.11)       $ (.03)            $ (.27)            $ (.10)
                   Pro forma                        $ (.11)       $ (.03)            $ (.27)            $ (.10)

            The Company has not granted stock options since June 1998.


                                      -11-




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

        The following discussion and analysis should be read in conjunction with
the financial statements and notes thereto.

FORWARD LOOKING STATEMENTS

        This Form 10-Q contains 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,  that are intended to be covered by
the  safe  harbors   created   thereby.   Investors  are   cautioned   that  all
forward-looking  statements  involve risks and  uncertainty,  including  without
limitation,  the  adequacy  of the  Company's  cash  from  operations,  existing
balances and  available  credit line.  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.  Factors  that could cause  actual  results to differ
from the results discussed in the forward-looking  statements  include,  but are
not limited to, the outcome of the Company's litigation discussed under Item 4 -
Litigation.   In   light   of   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.

CRITICAL ACCOUNTING POLICIES

        The  discussion  and analysis of our financial  condition and results of
operations are based upon the Company's consolidated financial statements, which
have been prepared in accordance with accounting  principles  generally accepted
in the United States of America.  The preparation of these financial  statements
requires the Company to make  estimates and  judgments  that affect the reported
amount of assets and liabilities,  revenues and expenses, and related disclosure
of contingent  assets and  liabilities  at the date of the  Company's  financial
statements.  Actual  results may differ  from these  estimates  under  different
assumptions or conditions.

        Critical accounting policies are defined as those that are reflective of
significant  judgments and  uncertainties,  and potentially result in materially
different  results  under  different  assumptions  and  conditions.  The Company
believes that its critical accounting policies include those described below.

REVENUE RECOGNITION

        Sales  revenue  is  generated  primarily  from  fees  for  food  service
management at continuing  care and health care  facilities and the  Collegeville
Inn  restaurant.  Revenue is  recognized  when services are  performed.  Ongoing
assessments of the credit worthiness of customers provide the Company reasonable
assurance of collectibility upon performance of services.

                                      -12-




ACCOUNTS RECEIVABLE

            The Company performs ongoing credit evaluations of its customers and
adjusts credit limits based on payment history and the customer's current credit
worthiness,  as determined by a review of their current credit information.  The
Company  continuously  monitors  collections and payments from its customers and
maintains a provision for estimated credit losses based on historical experience
and any specific  customer  collection  issues that have been identified.  While
such credit losses have historically been within the Company's  expectations and
the provisions  established,  the Company cannot guarantee that it will continue
to experience the same credit loss rates that it has in the past.

RESULTS OF OPERATIONS

            Revenues  for the quarter  ended March 31, 2003 were  $6,358,301,  a
decrease  of  $586,885  or 8.5%  compared  to  revenues  of  $6,945,186  for the
corresponding  quarter last year. Revenues for the nine month period ended March
31, 2003 were  $20,781,354,  a decrease of  $1,457,873  or 6.6%  compared to the
corresponding  period in 2002.  This decrease is primarily due to the net impact
of revenues from lost contracts versus revenues from new contracts.

            Costs  of  operations  for  the  current  quarter  were  $5,261,111,
compared  to  $5,475,462  for similar  expenses in the same period last year,  a
decrease of $214,351 or 3.9%.  For the nine month  period  ended March 31, 2003,
cost of operations were $17,153,764, compared to $17,588,109 for the same period
last year, a decrease of $404,345 or 2.3% compared to the  corresponding  period
in 2002.  This decrease in cost of services is due to lower revenues  during the
period partially offset by inflationary  price, wage and expense increases along
with payroll and related costs for new contracts.

            Gross Profit for the quarter was $1,097,190, compared to $1,469,724,
a decrease of $372,534 or 25.3%. For the nine month period ended March 31, 2003,
gross profit was $3,627,590 versus $4,681,118 a decrease of $1,053,528 or 22.5%.
These decreases are due to both lower revenues during the period and a change in
the nature of client contracts.

            General and administrative  expenses for the quarter were $1,071,604
or 16.9% of  revenue,  compared to  $1,064,830  or 15.3% of revenue for the same
quarter last year, an increase of $6,774.  For the nine month period ended March
31,  2003  general  and  administrative  expenses  were  $3,332,037  compared to
$3,438,356 for the corresponding  period last year, a decrease of $106,319.  The
decrease for the nine month period  versus the prior year is due to certain cost
cutting measures implemented by the Company.


                                      -13-




            Provision for doubtful accounts for the quarter was $85,999 compared
to $225,000 for the  corresponding  quarter last year. For the nine month period
ended March 31, 2003  provision for doubtful  accounts was $278,261  compared to
$675,000 for the same period last year. The aforementioned  decreases are due to
increased  collection  activities,  which led to overall  declines  in  accounts
receivables  in  each  of the  current  year's  quarters.  Additionally,  a cash
recovery of $141,738 of accounts receivable previously reserved as uncollectible
was utilized to increase  the  allowance  for  doubtful  accounts in the current
year. Lower sales volume also contributed to the aforementioned decreases.

            Interest expense for the quarter totaled $43,862 compared to $53,088
for the same period last year.  For the nine month  period ended March 31, 2003,
interest  expense was $148,321 versus $213,369 for the  corresponding  period in
2002.  The  decrease  in  interest  expense  is a  result  of the  repayment  of
borrowings as well as a reduction in interest rates.

            For the  reasons  stated  above net loss after taxes for the quarter
ended March 31, 2003 was ($306,759)  compared to ($79,774) for the corresponding
quarter last year. Net loss per share for the current quarter was $0.11 compared
to net loss per share of $0.03 for the corresponding quarter last year.

            Net loss for the nine month period was ($763,921)  versus ($291,337)
for the  corresponding  period last year.  Net loss per share for the nine month
period was ($0.27) compared to net loss per share of ($0.10) for the same period
last year.

LIQUIDITY AND CAPITAL RESOURCES

            At March 31, 2003, the Company had working capital of $713,920.

            OPERATING ACTIVITIES. Cash provided by operations for the nine month
period  ended March 31,  2003 was  $631,198  compared  to $673,049  for the nine
months ended March 31, 2002. The current  period's  activity is primarily due to
increased collections of accounts receivable.

            INVESTING ACTIVITIES.  Investing activities provided $15,776 in cash
in the current  period  compared to $366,213 in cash consumed in the same period
last year.

            FINANCING  ACTIVITIES.  Current period financing activities consumed
$421,015 in cash  compared to $134,057 in the same period last year.  The change
is attributable  to $1,520,915 of debt  repayments  offset by $1,099,900 of debt
proceeds.  Long-Term  Note  Payable  declined  by  $730,146  from June 30,  2002
primarily due to a reclassification to Accounts Payable.


                                      -14-





            CAPITAL  RESOURCES.  The Company has certain credit  facilities with
its bank  including  a  revolving  credit of  $4,000,000.  At March 31, 2003 the
Company had  $1,494,079  available  under its  revolving  credit  facility.  The
Company issued two series of Industrial Bonds totaling $3,560,548 in December of
1996. The outstanding  balance on the bonds was $2,810,000 as of March 31, 2003.
The Company is current with all its obligations to its bank and on its bonds and
is in compliance  with their  financial  covenants  except  covenants which were
specifically  waived  by  the  bank.  Additionally,  the  maturity  date  of the
revolving credit facility was extended from March 31, 2004 to December 31, 2004.



                                                                    Payment Due By Period
                                        =======================================================================
                                                        Less
             Contractual                  Total        than 1          1-3           4-5            After 5
             Obligations                 ------        year           years         years            years
             -----------                               ------         ------        -----           -------
        Long-Term Debt  *               5,398,906      191,813        2,677,093     315,000        2,215,000
        Operating Leases                 15,971        15,971             0            0               0
        Total Contractual Cash
        Obligations                     5,414,877      207,784        2,677,093     315,000        2,215,000



o    Long-Term Debt includes a $2,505,922  outstanding  balance on the revolving
     line of credit,  leaving  $1,494,079  available  for  borrowings  under the
     $4,000,000 revolving line of credit.


                                                                  Amount of Commitment Expiration
                                                                           Per Period
                                        ==================================================================
            Other Commercial            Total Amounts        Less than        1-3          4-5     Over 5
            Commitments                   Committed           1 year         years        years     years
            -----------                   ---------           ------         -----        -----     -----
        Lines of Credit                   4,000,000              0          4,000,000        0        0
        Standby Letter of
        Credit                            3,065,000              0          3,065,000        0        0
        Total Commercial Commitments
                                          7,065,000              0          7,065,000        0        0


                                      - 15-





            A substantial  portion of the Company's  revenues are dependent upon
the payment of its fees by customer  healthcare  facilities,  that, in turn, are
dependent  upon  third-party  payers  such as state  governments,  Medicare  and
Medicaid. Delays in payment by third-party payers,  particularly state and local
governments, may lead to delays in collection of accounts receivable.

            The Company has no material  commitments  for capital  expenditures,
including the Collegeville Inn & Conference  Center,  and believes that its cash
from operations, existing balances, and available credit facilities are adequate
for the foreseeable future to satisfy the needs of its operations.


ITEM 4.

CONTROLS AND PROCEDURES

            Based on their evaluation, as of a date within 90 days of the filing
of this Form 10-Q, the Company's  Chief  Executive  Officer and Chief  Financial
Officer have  concluded the Company's  disclosure  controls and  procedures  (as
defined in Rules  13a-14 and 15d-14 under the  Securities  Exchange Act of 1934)
are effective. There have been no significant changes in internal controls or in
other factors that could  significantly  affect these controls subsequent to the
date of their  evaluation,  including  any  corrective  actions  with  regard to
significant deficiencies and material weaknesses.


                                      -16-




                           PART II - OTHER INFORMATION


Item 1      Legal Proceedings                                           None

Item 2      Changes in Securities                                       None

Item 3      Defaults Upon Senior Securities                             None

Item 4      Submission of Matters to a Vote of Security Holders         None

Item 5      Other Information

            The Company  entered  into an agreement  dated  December 18, 2002 to
sell approximately 19 acres of land for $3,000,000. Such agreement is subject to
a due  diligence  review by the purchaser and  satisfaction  of certain  closing
conditions.  While there can be no assurance that the sale will be  consummated,
completion  of  the  sale  would  increase  the  Company's  working  capital  by
$3,000,000.

Item 6.     Exhibits and Reports on Form 8-K

(a) Exhibits                                                Certifications under
                                                            Section 906 of the
                                                            Sarbanes Oxley Act

(b) Reports on Form 8-K                                     None


                                      -17-





                                   SIGNATURES


            Pursuant to the requirements of the Securities Exchange Act of 1934,
the  Company  has duly  caused  this  report to be  signed on its  behalf by the
undersigned thereunto duly authorized.



                                         Nutrition Management Services Company


                                         /s/ Joseph V. Roberts
                                         -------------------------------
                                         Joseph V. Roberts
                                         Chairman and Chief Executive Officer


                                         /s/ William E. Sturgis
                                         --------------------------------
                                         William E. Sturgis
                                        (Principal Financial Officer)





Date:  May 20, 2003


                                      -18-





                      NUTRITION MANAGEMENT SERVICES COMPANY

                           A PENNSYLVANIA CORPORATION
                  CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

                            Section 302 Certification

I, Joseph Roberts, certify that:
     1.   I have  reviewed  this  quarterly  report  on Form  10-Q of  Nutrition
          Management Services Company, Inc.;
     2.   Based on my  knowledge,  this  quarterly  report  does not contain any
          untrue  statement of a material  fact or omit to state a material fact
          necessary to make the statements  made, in light of the  circumstances
          under which such  statements were made, not misleading with respect to
          the period covered by this quarterly report;
     3.   Based on my knowledge,  the financial statements,  and other financial
          information  included in this quarterly report,  fairly present in all
          material respects the financial  condition,  results of operations and
          cash flows of the registrant as of, and for, the periods  presented in
          this quarterly report;
     4.   The registrant's  other certifying  officers and I are responsible for
          establishing  and maintaining  disclosure  controls and procedures (as
          defined in Exchange  Act Rules  13a-14 and 15d-14) for the  registrant
          and have:
          a)   designed such  disclosure  controls and procedures to ensure that
               material  information  relating to the registrant,  including its
               consolidated  subsidiaries,  is made known to us by others within
               those  entities,  particularly  during  the  period in which this
               quarterly   report   is  being   prepared;
          b)   evaluated  the  effectiveness  of  the  registrant's   disclosure
               controls and  procedures as of a date within 90 days prior to the
               filing date of this quarterly report (the "Evaluation Date"); and
          c)   presented  in this  quarterly  report our  conclusions  about the
               effectiveness of the disclosure  controls and procedures based on
               our  evaluation as of the  Evaluation  Date;
     5.   The registrant's other certifying officers and I have disclosed, based
          on our most recent  evaluation,  to the registrant's  auditors and the
          audit  committee  of  registrant's  board  of  directors  (or  persons
          performing the equivalent functions):
          a)   all  significant  deficiencies  in the  design  or  operation  of
               internal  controls which could adversely  affect the registrant's
               ability to record,  process,  summarize and report financial data
               and have  identified for the  registrant's  auditors any material
               weaknesses in internal controls; and
          b)   any fraud,  whether or not material,  that involves management or
               other employees who have a significant  role in the  registrant's
               internal  controls;  and
     6.   The  registrant's  other  certifying  officers and I have indicated in
          this  quarterly  report  whether  there  were  significant  changes in
          internal controls or in other factors that could significantly  affect
          internal   controls   subsequent  to  the  date  of  our  most  recent
          evaluation,   including   any   corrective   actions  with  regard  to
          significant deficiencies and material weaknesses.


          Date: May 20, 2003                           /s/ Joseph Roberts
               ---------------------------             -------------------------
                                                       Joseph Roberts
                                                       Chairman of the Board and
                                                       Chief Executive Officer

                                      -19-




                      NUTRITION MANAGEMENT SERVICES COMPANY

                           A PENNSYLVANIA CORPORATION
                  CERTIFICATION OF PRINCIPAL FINANCIAL MANAGER

                            Section 302 Certification

I, William Sturgis, certify that:
     1.   I have  reviewed  this  quarterly  report  on Form  10-Q of  Nutrition
          Management Services Company, Inc.;
     2.   Based on my  knowledge,  this  quarterly  report  does not contain any
          untrue  statement of a material  fact or omit to state a material fact
          necessary to make the statements  made, in light of the  circumstances
          under which such  statements were made, not misleading with respect to
          the period covered by this quarterly report;
     3.   Based on my knowledge,  the financial statements,  and other financial
          information  included in this quarterly report,  fairly present in all
          material respects the financial  condition,  results of operations and
          cash flows of the registrant as of, and for, the periods  presented in
          this quarterly report;
     4.   The registrant's  other certifying  officers and I are responsible for
          establishing  and maintaining  disclosure  controls and procedures (as
          defined in Exchange  Act Rules  13a-14 and 15d-14) for the  registrant
          and have:
          a)   designed such  disclosure  controls and procedures to ensure that
               material  information  relating to the registrant,  including its
               consolidated  subsidiaries,  is made known to us by others within
               those  entities,  particularly  during  the  period in which this
               quarterly report is being prepared;
          b)   evaluated  the  effectiveness  of  the  registrant's   disclosure
               controls and  procedures as of a date within 90 days prior to the
               filing date of this quarterly report (the "Evaluation Date"); and
          c)   presented  in this  quarterly  report our  conclusions  about the
               effectiveness of the disclosure  controls and procedures based on
               our evaluation as of the Evaluation Date;
     5.   The registrant's other certifying officers and I have disclosed, based
          on our most recent  evaluation,  to the registrant's  auditors and the
          audit  committee  of  registrant's  board  of  directors  (or  persons
          performing the equivalent functions):
          a)   all  significant  deficiencies  in the  design  or  operation  of
               internal  controls which could adversely  affect the registrant's
               ability to record,  process,  summarize and report financial data
               and have  identified for the  registrant's  auditors any material
               weaknesses in internal controls; and
          b)   any fraud,  whether or not material,  that involves management or
               other employees who have a significant  role in the  registrant's
               internal controls; and
     6.   The  registrant's  other  certifying  officers and I have indicated in
          this  quarterly  report  whether  there  were  significant  changes in
          internal controls or in other factors that could significantly  affect
          internal   controls   subsequent  to  the  date  of  our  most  recent
          evaluation,   including   any   corrective   actions  with  regard  to
          significant deficiencies and material weaknesses.


          Date: May 20, 2003                        /s/ William Sturgis
               ------------------------------       --------------------------
                                                    William Sturgis
                                                    Principal Financial Manager


                                      -20-`