<PAGE>
 
                      SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C.  20549

                            ______________________

                                   FORM 10-Q
                                   ---------

    [ X ]  Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
           Exchange Act of 1934

                 For the quarterly period ended March 31, 1999


                                       or

    [   ]  Transition Report Pursuant to Section 13 or 15(d) of the Securities
           Exchange Act of 1934

             For the transition period ___________ to ___________


                       Commission File Number:  0-23363


                        AMERICAN DENTAL PARTNERS, INC.
            (Exact name of registrant as specified in its charter)


            DELAWARE                                     04-3297858
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
 incorporation or organization)     

                        American Dental Partners, Inc.
                        301 Edgewater Place, Suite 320
                        Wakefield, Massachusetts  01880
         (Address of principal executive offices, including zip code)

                                (781) 224-0880
                             (781) 224-4216 (fax)
             (Registrant's telephone number, including area code)

                                      N/A
             (Former name, former address and former fiscal year, 
                         if changed 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 reports), and (2) has been subject to such filing
requirements for the past 90 days.


                               X    YES                   NO
                             -----                 -----

Indicate the number of shares outstanding of each of the issuer's classes of
common stock as of the latest practicable date.

Common Stock, $0.01 par value, outstanding as of May 12, 1999:  7,517,448 shares


================================================================================
                                                Exhibit Index appears on Page 17
<PAGE>
 
                        AMERICAN DENTAL PARTNERS, INC.

                                        
                                     INDEX
                                     -----
<TABLE>
<CAPTION>
                                                                            Page
                                                                            ----
<S>                                                                        <C>
Part I.       Financial Information
 
Item 1.       Financial Statements
 
              Consolidated Balance Sheets at December 31, 1998
              and March 31, 1999 (unaudited)................................  3
 
              Consolidated Statements of Earnings for the Three Months
              Ended March 31, 1998 and 1999 (unaudited).....................  4
 
              Consolidated Statement of Stockholders' Equity for the
              Three Months Ended March 31, 1999 (unaudited) ................  5
 
              Consolidated Statements of Cash Flows for the
              Three Months Ended March 31, 1998 and 1999 (unaudited)........  6
 
              Notes to Interim Consolidated Financial Statements ...........  7
      
Item 2.       Management's Discussion and Analysis of Financial Condition 
              and Results of Operations.....................................  9


Item 3.       Quantitative and Qualitative Disclosures About Market Risk.... 15
 
Part II.      Other Information
 
Item 1.       Legal Proceedings ............................................ 15
 
Item 2.       Changes in Securities and Use of Proceeds..................... 15
 
Item 3.       Defaults Upon Senior Securities .............................. 15
 
Item 4.       Submission of Matters to a Vote of Security Holders .......... 15
 
Item 5.       Other Information ............................................ 15
 
Item 6.       Exhibits and Reports on Form 8-K ............................. 15
 
Signatures    .............................................................. 16
 
Exhibit Index .............................................................. 17
 
Exhibit 27    .............................................................. 18
</TABLE>

                                       2
<PAGE>
 
                        AMERICAN DENTAL PARTNERS, INC.

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


<TABLE>
<CAPTION>
                                                    December 31,     March 31,
                                                        1998           1999
                                                        ----           ----
                                                                   (unaudited)
<S>                                              <C>           <C>
ASSETS 
Current assets:                                
 Cash and cash equivalents........................   $ 2,091        $ 2,995
 Accounts receivable..............................       186            218
 Receivables due from affiliated practices........     4,579          5,586
 Inventories......................................       585            779
 Prepaid expenses and other receivables...........     1,466          1,569
 Deferred income taxes............................        65             65
                                                     -------        -------
       Total current assets.......................     8,972         11,212
                                                     -------        -------
                                               
Property and equipment, net.......................    12,943         15,401
                                                     -------        -------
Non-current assets:                            
 Intangible assets, net...........................    47,152         56,461
 Deferred income taxes............................     1,120          1,528
 Other assets.....................................       348            351
                                                     -------        -------
       Total non-current assets...................    48,620         58,340
                                                     -------        -------
       Total assets...............................   $70,535        $84,953
                                                     =======        =======
                                               
LIABILITIES AND STOCKHOLDERS' EQUITY           
Current liabilities:                           
 Accounts payable.................................   $ 3,010        $ 4,158
 Accrued compensation, benefits and taxes.........     3,426          3,572
 Accrued expenses.................................     3,377          4,234
 Income taxes payable.............................       805            661
 Current maturities of debt.......................     1,079          1,184
                                                     -------        -------
       Total current liabilities..................    11,697         13,809
                                                     -------        -------
Non-current liabilities:                       
 Long-term debt...................................     9,980         20,076
 Other liabilities................................       553            748
                                                     -------        -------
       Total non-current liabilities..............    10,533         20,824
                                                     -------        -------
       Total liabilities..........................    22,230         34,633
                                                     -------        -------
Stockholders' equity:                          
   Preferred stock, par value $0.01 per share, 
     1,000,000 shares authorized, no shares    
     issued or outstanding........................         -              -
   Common stock, par value $0.01 per share,    
     25,000,000 shares authorized, 7,436,066   
     and 7,517,448 shares issued and outstanding..        74             75 
   Additional paid-in capital.....................    45,742         46,396 
   Unearned compensation..........................       (24)           (18)
   Retained earnings..............................     2,513          3,867
                                                     -------        -------
       Total stockholders' equity.................    48,305         50,320
                                                     -------        -------
Commitments and contingencies                  
       Total liabilities and stockholders' equity.   $70,535        $84,953
                                                     =======        =======
</TABLE>
     See accompanying notes to interim consolidated financial statements.

                                       3
<PAGE>
 
                        AMERICAN DENTAL PARTNERS, INC.

                      CONSOLIDATED STATEMENTS OF EARNINGS
                   (in thousands, except per share amounts)

<TABLE>
<CAPTION>
                                                      Three Months Ended
                                                           March 31,
                                                       ----------------
                                                       1998        1999
                                                       ----        ----
                                                         (unaudited)
<S>                                                 <C>         <C>
Net revenue......................................    $18,171     $26,234
                                                     -------     -------
Operating expenses:                              
    Salaries and benefits........................      9,649      12,913
    Lab fees and dental supplies.................      2,196       3,507
    Office occupancy.............................      1,609       2,445
    Other operating expenses.....................      1,645       2,154
    General corporate expenses...................        975       1,196
    Depreciation.................................        556         768
    Amortization of intangibles..................        333         554
                                                     -------     -------
        Total operating expenses.................     16,963      23,537
                                                     -------     -------
Earnings from operations.........................      1,208       2,697
    Interest expense, net........................        439         284
                                                     -------     -------
Earnings before income taxes.....................        769       2,413
    Income taxes.................................        300       1,059
                                                     -------     -------
    Net earnings.................................    $   469     $ 1,354
                                                     =======     =======
                                                 
Net earnings per common share:                   
    Basic........................................    $  0.06     $  0.18
    Diluted......................................    $  0.06     $  0.18
                                           
Weighted average common shares outstanding:       
    Basic........................................      2,429       7,471
    Diluted......................................      2,632       7,669
</TABLE>
     See accompanying notes to interim consolidated financial statements.

                                       4
<PAGE>
 
                        AMERICAN DENTAL PARTNERS, INC.

                CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
                   FOR THE THREE MONTHS ENDED MARCH 31, 1999
                                (in thousands)
                                  (unaudited)

<TABLE>
<CAPTION>
                                                 Common Stock        Additional                                     Total
                                             -------------------      Paid-in        Unearned       Retained    Stockholders'
                                             Shares       Amount      Capital      Compensation     Earnings       Equity
                                             ------       ------      -------      ------------     --------    ------------
<S>                                         <C>      <C>         <C>           <C>              <C>          <C>
Balance at December 31, 1998...............   7,436         $74       $45,742            $(24)       $2,513        $48,305
  Common stock issued for
    acquisitions and affiliations..........      50           1           351               -             -            352
  Common stock issued for the
    employee stock purchase plan...........      31           -           303               -             -            303
  Amortization of unearned compensation....       -           -             -               6             -              6
  Net earnings.............................       -           -             -               -         1,354          1,354
                                              -----         ---       -------            ----        ------        -------
Balance at March 31, 1999..................   7,517         $75       $46,396            $(18)       $3,867        $50,320
                                              =====         ===       =======            ====        ======        =======
</TABLE>
     See accompanying notes to interim consolidated financial statements.

                                       5
<PAGE>
 
                         AMERICAN DENTAL PARTNERS, INC.

                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (in thousands)
<TABLE>
<CAPTION>
                                                            Three Months Ended
                                                                 March 31,
                                                             -----------------
                                                             1998         1999
                                                             ----         ----
                                                               (unaudited)
<S>                                                       <C>         <C>
Cash flows from operating activities:
  Net earnings...........................................  $   469     $  1,354
  Adjustments to reconcile net earnings to                   
    net cash provided by operating activities:               
      Depreciation.......................................      556          768
      Amortization of intangibles........................      333          554
      Other amortization.................................       25           26
      Changes in assets and liabilities, net of                  
        acquisitions and affiliations:                           
          Accounts receivable............................       45          511
          Receivables due from affiliated practices......      148       (1,640)
          Other current assets...........................     (111)        (149)
          Accounts payable and accrued expenses..........     (281)         798
          Accrued compensation, benefits and taxes.......   (1,061)        (354)
          Income taxes payable...........................      439         (144)
                                                           -------     --------
            Net cash provided by operating activities....      562        1,724
                                                           -------     --------
                                                           
Cash flows from investing activities:                      
  Acquisitions and affiliations, net of cash acquired....   (2,590)      (7,038)
  Capital expenditures, net..............................     (669)      (2,592)
  Other..................................................     (423)        (490)
                                                           -------     --------
            Net cash used for investing activities.......   (3,682)     (10,120)
                                                           -------     --------
                                                           
Cash flows from financing activities:                      
  Borrowings under (repayments of) revolving line of         
    credit, net..........................................    3,850        9,597
  Common stock issued for the employee stock purchase 
    plan.................................................        -          303
  Repayment of borrowings................................     (387)        (586)
  Payment of initial public offering costs...............     (322)           -
  Payment of debt issuance costs.........................        -          (14)
                                                           -------     --------
            Net cash provided by financing activities....    3,141        9,300
                                                           -------     --------
                                                           
Increase in cash and cash equivalents....................       21          904
Cash and cash equivalents at beginning of period.........    4,675        2,091
                                                           -------     --------
Cash and cash equivalents at end of period...............  $ 4,696     $  2,995
                                                           =======     ========
                                                           
Supplemental disclosure of cash flow information:          
  Cash paid during the period for interest, net..........  $   361     $    156
                                                           =======     ========
  Cash paid during the period for income taxes, net......  $    13     $  1,203
                                                           =======     ========
Acquisitions and affiliations:                             
  Assets acquired........................................  $ 4,228     $ 11,101
  Liabilities assumed and issued.........................   (1,391)      (3,575)
  Common stock issued....................................     (247)        (359)
                                                           -------     --------
  Cash paid..............................................    2,590        7,167
  Less cash acquired.....................................        -         (129)
                                                           -------     --------
            Net cash paid for acquisitions and 
             affiliations................................  $ 2,590     $  7,038
                                                           =======     ========
</TABLE>
     See accompanying notes to interim consolidated financial statements.

                                       6
<PAGE>
 
                        AMERICAN DENTAL PARTNERS, INC.
              NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS


(1)  Basis of Presentation

     The interim consolidated financial statements include the accounts of
American Dental Partners, Inc. and its wholly-owned subsidiaries (the
"Company"). All intercompany balances and transactions have been eliminated in
consolidation.

     The Company does not own any interests in or control the activities of the
affiliated dental practices. Accordingly, the financial statements of the
affiliated dental practices are not consolidated with those of the Company.

     The interim consolidated financial statements are unaudited, but in the
opinion of management include all adjustments, which consist only of normal and
recurring adjustments, necessary for a fair presentation of its financial
position and results of operations. Results of operations for the interim
periods are not necessarily indicative of the results to be expected for the
full year. These financial statements should be read in conjunction with the
consolidated financial statements of the Company as of and for the year ended
December 31, 1998.

(2)  Acquisitions and Affiliations

     During 1998, the Company acquired substantially all the assets of ten
dental practices and simultaneously entered into 40-year service agreements with
four of the affiliated dental groups (six practices joined existing affiliates).
The aggregate purchase price paid in connection with these transactions
consisted of approximately $18.4 million in cash, $2.2 million in subordinated
promissory notes, $1.0 million in deferred payments, 54,354 shares of Common
Stock and future contingent payments for one affiliation based on a multiple of
service fees received in excess of a predetermined threshold for each of the
three years ending May 31, 1999, 2000 and 2001. All transactions completed in
1998 are referred to as the "1998 Transactions."

     From January 1, 1999 to March 31, 1999, the Company acquired substantially
all the assets of five dental group practices and simultaneously entered into 
40-year service agreements with two of the affiliated dental groups (three
practices joined existing affiliates). The aggregate purchase price paid in
connection with these transactions consisted of approximately $7.2 million in
cash, $0.7 million in subordinated promissory notes, $0.3 million in deferred
payments and 50,568 shares of Common Stock. All transactions completed in 1999
are referred to as the "1999 Transactions."

The 1998 and 1999 Transactions completed through March 31, 1999 are as follows:

<TABLE>
<CAPTION>
                Date                         Affiliated Group                        Location(s)
                ----                         ----------------                        -----------
<S>                                   <C>                                    <C>
January 1998........................  Associated Dental Care Providers       Phoenix and Tucson, AZ
April 1998..........................  Family Care Dental Centers             Janesville, Kenosha and Racine, WI
April 1998..........................  John E. Carey, D.D.S. and              Madison, WI
                                        James J. Peterman, D.D.S.
April 1998..........................  Leroy S. Crapanzano, D.D.S.            Hammond, LA
June 1998...........................  Reston Dental Group                    Reston, VA
June 1998...........................  TSC Dental Centers                     Houston, TX
July 1998...........................  Indiana Dental Group                   Indiana, PA
September 1998......................  Mintz & Pincus Dental Group            Oxon Hill and Waldorf, MD
September 1998......................  Westmore Dental Group                  Mt. Pleasant, PA
November 1998.......................  St. Croix Valley Orthodontics          Hudson, WI
February 1999.......................  Dental Care of Alabama                 Birmingham and Tuscaloosa, AL
February 1999.......................  CIGNA HealthCare of Arizona            Phoenix, AZ
March 1999..........................  OK Dental                              Oklahoma City and Tulsa, OK
March 1999..........................  Jack G. Stacker, D.D.S.                Wausau, WI
March 1999..........................  Kenneth W. Van Sickle, Jr., D.M.D.     Mt. Pleasant, PA
</TABLE>

  The accompanying interim consolidated financial statements include the results
of operations under the service agreements from the date of acquisition. The
excess of the purchase price of all the 1998 and 1999 Transactions over the
estimated fair value of the net assets acquired has been recorded as intangible
assets.

                                       7
<PAGE>
 
                        AMERICAN DENTAL PARTNERS, INC.
        NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS  (Continued)


(3)  Earnings Per Share

     Earnings per share are computed based on Statement of Financial Accounting
Standard No. 128 "Earnings per Share" ("SFAS 128"). SFAS 128 requires
presentation of basic earnings per share ("Basic EPS") and diluted earnings per
share ("Diluted EPS") by all entities that have publicly traded common stock or
potential common stock (options, warrants, convertible securities or contingent
stock arrangements). Basic EPS is computed by dividing income available to
common stockholders by the weighted average number of common shares outstanding
during the period. Diluted EPS gives effect to all dilutive potential common
shares outstanding during the period. The computation of Diluted EPS does not
assume conversion, exercise or contingent exercise of securities that would have
an antidilutive effect on earnings.

     The following table provides a reconciliation of the numerators and
denominators of the basic and diluted earnings per share computations for the
three months ended March 31:

<TABLE>
<CAPTION>
                                                                               Three Months Ended
                                                                                    March 31,
                                                                             -----------------------
                                                                              1998             1999
                                                                             ------           ------
                                                                              (in thousands, except 
                                                                                  per share data)
<S>                                                                         <C>              <C>
Basic Earnings Per Share                                                  
Net earnings.............................................................    $  469           $1,354
Less: Dividends on Series A Convertible Preferred Stock..................      (165)               -
      Dividends on Series B Redeemable Preferred Stock...................      (159)               -
                                                                             ------           ------
Net earnings available to common stockholders............................    $  145           $1,354
                                                                             ======           ======
Weighted average common shares outstanding...............................     2,429            7,471
                                                                             ======           ======
Net earnings per share...................................................    $ 0.06           $ 0.18
                                                                             ======           ======

Diluted Earnings Per Share                                                
Net earnings.............................................................    $  469           $1,354
Less: Dividends on Series A Convertible Preferred Stock..................      (165)               -
      Dividends on Series B Redeemable Preferred Stock...................      (159)               -
                                                                             ------           ------ 
Net earnings available to common stockholders............................    $  145           $1,354
                                                                             ======           ======
                                                                          
Weighted average common shares outstanding...............................     2,429            7,471
Add: Dilutive effect of options..........................................       203              198
     Assumed conversion of Series A Convertible Preferred Stock(1).......         -                -
                                                                             ------           ------ 
Weighted average common shares as adjusted...............................     2,632            7,669
                                                                             ======           ======
                                                                          
Net earnings per share...................................................    $ 0.06           $ 0.18
                                                                             ======           ======
</TABLE> 
(1)  The assumed conversion of Series A Convertible Preferred Stock was not
     included in the calculation of Diluted EPS for the three months ended 
     March 31, 1998, as the inclusion of this item would have been antidilutive.

                                       8
<PAGE>
 
                        AMERICAN DENTAL PARTNERS, INC.
                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                 FINANCIAL CONDITION AND RESULTS OF OPERATIONS


     Certain statements in this Report on Form 10-Q may constitute "forward-
looking statements" within the meaning of the federal securities laws. Forward-
looking statements are based on management's current beliefs, assumptions and
expectations of our future economic performance, taking into account information
available at the time the statements are made. Forward-looking statements are
subject to uncertainties and other factors that may cause our actual performance
or financial condition in the future to be materially different from the
expectations stated in the forward-looking statements. Some of the important
factors that could cause our actual results, performance or financial condition
to differ materially from expectations are set forth in the "Risk Factors"
section of our Registration Statement on Form S-4 (File No. 333-56941).

     Statements which include the words "believe," "expect," "anticipate,"
"project," "estimate," "forecast" and similar expressions should be considered
forward-looking statements. These statements speak only as of the date they were
made, and we are not obligated to publicly update or revise them, whether as a
result of new information, future events or otherwise.

Overview

     American Dental Partners, Inc. is a leading provider of dental practice
management services to multi-disciplinary dental group practices in selected
markets throughout the United States. We were formed in December 1995. We began
our dental practice management operations in November 1996 when we completed the
affiliation with our first dental group practice. Our rapid growth has resulted
primarily from our affiliations with dental group practices. From November 1996
to March 31, 1999, we completed affiliations with 24 dental group practices and,
at March 31, 1999, operated 123 dental facilities with 1,013 operatories in ten
states.

Affiliation Summary

     When affiliating with a dental group practice, we acquire substantially all
its assets, except those required by law to be owned or maintained by dentists
(such as third party contracts, certain governmental receivables and patient
records), and enter into a long-term service agreement with the affiliated
dental practice or professional corporation (the "PC"). Under our service
agreements, we are responsible for providing all services necessary for the
administration of the non-clinical aspects of the dental operations. The PC is
responsible for the provision of dental care. Each of our service agreements is
for an initial term of 40 years. We do not own or control the affiliated dental
practices and, accordingly, do not consolidate the financial statements of the
PCs with ours.

  1998 Transactions

     During 1998, we acquired substantially all the assets of ten dental group
practices and simultaneously entered into 40-year service agreements with four
of them (six practices joined existing affiliates).

  1999 Transactions (completed through March 31, 1999)

     Since the beginning of 1999, we have acquired substantially all the assets
of five dental group practices and simultaneously entered into 40-year service
agreements with two of them (three practices joined existing affiliates).

Components of Revenue and Expenses

     Affiliate Adjusted Gross Revenue and Payor Mix.  Our affiliated dental
group practices generate revenue from patients and third party payors under fee-
for-service, PPO plans and capitated managed care plans. The affiliated dental
group practices record revenue at established rates reduced by contractual
adjustments and allowances for doubtful accounts to arrive at adjusted gross
revenue. Contractual adjustments represent the difference between gross billable
charges at established rates and the portion of those charges reimbursed
pursuant to certain third party payor contracts. While payor mix varies from
market to market, the aggregate payor mix percentage of our affiliated practices
for the three months ended March 31, 1999 was approximately 43% fee-for-service,
12% preferred provider organization plans and 45% capitated managed care plans.

                                       9
<PAGE>
 
                        AMERICAN DENTAL PARTNERS, INC.
                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS  (Continued)


     The PC reimburses us for expenses incurred on its behalf in connection with
the operation and administration of the dental facilities and pays fees to us
for management services. Expenses incurred for the operation and administration
of the dental facilities include salaries and benefits for non-dentist personnel
working at the dental facilities (the administrative staff and, where permitted
by law, the dental hygienists and dental assistants), lab fees, dental supplies,
office occupancy costs of the dental facilities (rent, utilities, etc.) and
depreciation related to the fixed assets at the dental facilities. The PC is
also responsible for provider expenses, which generally consist of the salaries,
benefits and certain other expenses of the dentists.

     Net Revenue.  Our net revenue represents the aggregate fees charged to the
affiliated dental practices pursuant to the terms of the long-term service
agreements under which we agree to manage the non-clinical aspects of the dental
practice. Under such agreements, the affiliated dental group practices reimburse
us for actual expenses incurred in connection with the operation and
administration of the dental facilities and pay fees to us for our management
services. Our service fees typically consist of a fixed monthly fee and an
additional variable fee. The fixed monthly fee is determined prior to each
affiliation and annually thereafter by agreement of us and the affiliated dental
group in a formal budgeting process. To the extent that there is operating
income after payment of the fixed monthly fee, reimbursement of expenses
incurred in connection with the operation and administration of the dental
facilities and payment of provider expenses, an additional variable fee is paid
to us in the amount of such excess up to budgeted operating income and 50% of
such excess over budgeted operating income. Under certain service agreements,
our service fees consist of a variable monthly fee which is based upon a
specified percentage of the amount by which the PC's adjusted gross revenue
exceeds expenses incurred in connection with the operation and administration of
its dental facilities. In those situations, no additional variable fee is
applicable. Additionally, our net revenue includes amounts from third party
payors related to the arrangement of the provision of care to patients.

     Operating Expenses.  Operating expenses (excluding general corporate
expenses, depreciation and amortization of intangibles) consist of the expenses
incurred by us in fulfilling our obligations under the service agreements. These
expenses are operating costs and expenses that would have been incurred by the
affiliated dental groups had they not affiliated with us and include non-dentist
salaries and benefits, lab fees and dental supplies, office occupancy costs and
other expenses related to operations. Salaries and benefits expense are for
personnel working for us at the dental facilities, as well as the local
operating management. At the facility level, we generally employ the
administrative staff and, where permitted by law, the dental hygienists and
dental assistants. The local operating management team supervises and supports
the staff at the dental facilities. Office occupancy includes rent expense and
certain other operating costs such as utilities associated with dental
facilities and the local administrative offices. Such costs vary based on the
size of each facility and the market rental rate for dental office space in the
particular geographic market. Other expenses consist of professional fees,
marketing costs and other general and administrative expenses.

     General Corporate Expenses.  General corporate expenses consist of
compensation expenses for our corporate personnel and administrative staff, as
well as facility and other administrative costs of our corporate office. We
provide management, administrative, third party contracting and other services
to the affiliated groups.

     Depreciation.  Depreciation expense includes depreciation charges related
to leasehold improvements and furniture, fixtures and equipment used to operate
the dental facilities, local management offices and our corporate office.

     Amortization of Intangibles.  Amortization of intangibles relates to
intangible assets incurred in connection with completed transactions.

                                       10
<PAGE>
 
                        AMERICAN DENTAL PARTNERS, INC.
                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS  (Continued)


Three Months Ended March 31, 1998 Compared to the Three Months Ended March 31,
1999

  Overview

     Our net earnings amounted to $469,000 or diluted earnings per share of
$0.06 for the three months ended March 31, 1998, as compared with net earnings
of $1,354,000 or diluted earnings per share of $0.18 for the three months ended
March 31, 1999. The increase in net earnings resulted from incremental earnings
provided from completed acquisitions and affiliations and from internal growth.

     Net Revenue.  Net revenue increased from $18,171,000 for 1998 to
$26,234,000 for 1999, an increase of approximately 44%. The increase in net
revenue in 1999 is due primarily to the inclusion of revenue derived from
service agreements entered into in connection with the 1998 transactions for the
entire period and from the 1999 transactions. In addition, same market growth
from our affiliates in Austin, Milwaukee, Minneapolis, New Orleans, Phoenix,
Pittsburgh and Tucson resulted from the addition and expansion of our
facilities, the addition of dentists to our affiliated dental group network and
increases in certain affiliates' fees. Net revenue included expense
reimbursements ($12,204,000 for 1998 as compared with $17,476,000 for 1999),
management service fees ($3,925,000 for 1998 as compared with $6,367,000 for
1999) and revenue related to the arrangement of the provision of care to
patients ($2,042,000 for 1998 as compared with $2,391,000 for 1999). Expense
reimbursements included rent expense ($1,164,000 for 1998 as compared with
$1,761,000 for 1999) and other operating expenses ($11,040,000 for 1998 as
compared with $15,715,000 for 1999). Management service fees included a monthly
fee ($3,740,000 for 1998 as compared with $6,096,000 for 1999) and an additional
variable fee ($185,000 for 1998 as compared with $271,000 for 1999). Net revenue
derived from our service agreement with Park Dental represented approximately
44% and 36% of our consolidated net revenue for 1998 and 1999, respectively.

     Salaries and Benefits Expense.  Salaries and benefits amounted to
$9,649,000 or 53.1% of net revenue for 1998, as compared with $12,913,000 or
49.2% of net revenue for 1999. The decrease in salaries and benefits as a
percentage of net revenue resulted primarily from more efficient utilization of
staff in existing facilities, the regionalization of finance, operations and
administrative staff in certain markets and the acquisition of facilities with a
generally lower ratio of staffing costs to net revenue in their respective
markets compared to the existing base of facilities. These savings were
partially offset by an increase in the amount of expense related to the
arrangement of the provision of care to patients, which is at a higher
percentage of net revenue.

     Lab Fees and Dental Supplies Expense.  Lab fees and dental supplies expense
increased from $2,196,000 or 12.1% of net revenue for 1998 to $3,507,000 or
13.4% of net revenue for 1999. Lab fees and dental supplies expense varies from
affiliate to affiliate and is affected by the volume and type of procedures
performed. The increase in lab fees and dental supplies as a percentage of net
revenue is attributable to a combination of the acquisition of facilities with a
generally higher ratio of lab fees and dental supplies expense to net revenue in
their respective markets compared to the existing base of facilities, rate
increases from certain lab providers and the outsourcing of certain lab work
which was previously handled in-house.

     Office Occupancy Expense.  Office occupancy expense amounted to $1,609,000
or 8.9% of net revenue for 1998, as compared with $2,445,000 or 9.3% of net
revenue for 1999. Office occupancy expense increased as a percentage of net
revenue due to investment in the expansion of dental facilities and local
management offices in Arizona, Texas and Virginia. These increased costs were
partially offset by better utilization of capacity in existing facilities.

     Other Operating Expenses. Other expenses amounted to $1,645,000 or 9.1% of
net revenue for 1998, as compared with $2,154,000 or 8.2% of net revenue for
1999. Other costs decreased as a percentage of net revenue due primarily to the
reduction of certain expenses associated with the administration of a benefit
plan that was renegotiated, the regionalization of administrative functions in
certain markets, and efficiencies from managing certain expenses, such as
professional fees and other costs associated with operating a stand alone dental
group practice, on a national level, as opposed to on a local level.

                                       11
<PAGE>
 
                        AMERICAN DENTAL PARTNERS, INC.
                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS  (Continued)


     General Corporate Expenses. General corporate expenses were $975,000 or
5.4% of net revenue for 1998, as compared with $1,196,000 or 4.6% of net revenue
for 1999. We have built our management infrastructure in anticipation of rapid
growth. This included the hiring of key management and support staff in the
areas of finance, operations and information systems. In 1998, we began to
leverage these costs, resulting in a reduction of general corporate expenses as
a percentage of net revenue. This leverage continues to a lesser extent during
1999. This reduction was partially offset by an increase in costs associated
with being a public company. The level of general corporate expenses will likely
continue to increase in the future as we continue to expand our management
infrastructure. However, it is anticipated that these expenses will continue to
decline as a percentage of net revenue.

     Depreciation. Depreciation expense was $556,000 or 3.1% of net revenue for
1998, as compared with $768,000 or 2.9% of net revenue for 1999. Depreciation
expense included depreciation related primarily to the assets acquired and
capital expenditures associated with the development of new dental facilities in
Minneapolis and Phoenix and the expansion of facilities in Austin and
Minneapolis in 1999, the opening of three new facilities in Minneapolis and one
new facility in Phoenix in 1998 and the addition of new operatories in Austin,
Milwaukee and Minneapolis in 1998. Depreciation expense decreased as a
percentage of net revenue due to leveraging of our existing property and
equipment, despite the capital expenditures described above. Depending on the
amount and timing of future capital expenditures, depreciation expense will
likely increase.

     Amortization of Intangibles.  Amortization of intangibles was $333,000 or
1.8% of net revenue for 1998, as compared with $554,000 or 2.1% of net revenue
for 1999. The increase in amortization resulted from intangible assets recorded
in connection with our ten affiliations completed during 1998 and five
affiliations completed during 1999. We expect that amortization of intangibles
will increase in the future as a result of intangibles recorded in connection
with future acquisitions and affiliations.

     Interest Expense, net.  Net interest expense was $439,000 or 2.4% of net
revenue for 1998, as compared with $284,000 or 1.1% of net revenue for 1999. The
decrease in interest expense resulted from a lower average balance of borrowings
under our revolving credit facility in 1999 as compared with 1998. Borrowings
under our revolving line of credit that were outstanding during 1998 were repaid
with proceeds from our initial public offering completed in April 1998. This
interest expense savings was partially offset by higher interest expense related
to the issuance of subordinated notes in connection with the completed
Transactions in 1998 and 1999.

     Income Taxes.  We incurred income tax expense of $300,000 for 1998, as
compared with $1,059,000 for 1999. Our effective tax rate was approximately 39%
for 1998 as compared with 43.9% for 1999. The increase in the effective tax rate
is primarily attributable to the fact that the remaining net operating loss
carryforwards from 1996 were fully utilized to offset a portion of our taxable
income in 1998. In addition, an increase in the amount of amortization of
intangible assets which are not deductible for tax purposes also led to an
increase in the effective tax rate in 1999.

Liquidity and Capital Resources

     We have financed our operating and capital needs, including cash used for
acquisitions, capital expenditures and working capital, from our sales of equity
securities, borrowings under our revolving line of credit and cash generated
from operations.

     From January 1, 1998 through March 31, 1999, we completed 15 dental group
practice affiliations for aggregate consideration of $25.6 million in cash, 
$2.9 million in subordinated promissory notes, $1.3 million in deferred
payments, 104,922 shares of Common Stock and future contingent payments for one
affiliation based on a multiple of service fees received in excess of a
predetermined threshold for each of the three years ending May 31, 1999, 2000
and 2001.

     For the three months ended March 31, 1998 and 1999, cash provided by
operating activities amounted to $562,000 and $1,724,000, respectively. The
increase in cash from operations resulted primarily from earnings generated from
acquisitions and affiliations, same market growth and expanded profit margins.

                                       12
<PAGE>
 
                        AMERICAN DENTAL PARTNERS, INC.
                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS  (Continued)


     For the three months ended March 31, 1998 and 1999, cash used in investing
activities amounted to $3,682,000 and $10,120,000, respectively. Cash used for
investing activities included cash used for acquisitions and affiliations and
for capital expenditures. Cash used for acquisitions, net of cash acquired, was
$2,590,000 for 1998 and $7,038,000 for 1999. Cash used for capital expenditures
was $669,000 and $2,592,000 for 1998 and 1999, respectively. Capital
expenditures for 1998 included costs associated with the addition of three new
dental facilities in Minneapolis, a new dental facility in Phoenix and the
addition of new operatories in Austin, Milwaukee and Minneapolis. Capital
expenditures for 1999 included costs associated with the addition of new
facilities in Minneapolis and Phoenix and the expansion of existing facilities
in Austin and Minneapolis. The establishment of new dental facilities and the
expansion of existing dental facilities in the future will require ongoing
capital expenditures.

     For the three months ended March 31, 1998 and 1999, cash provided by
financing activities amounted to $3,141,000 and $9,300,000, respectively. Cash
provided by financing activities during 1998 resulted from borrowings under our
revolving line of credit of $3,850,000, net of the repayment of certain
indebtedness and the payment of initial public offering costs. Cash provided by
financing activities in 1999 resulted from borrowings under our revolving line
of credit of $9,597,000 and proceeds from the issuance of common stock for the
employee stock purchase plan of $303,000, net of the repayment of certain
indebtedness.

     In April 1997, we entered into a $30 million revolving line of credit
agreement with a bank. In December 1998, we amended our line of credit to 
(i) increase the amount available under the line to $50 million, (ii) add two
additional banks, (iii) extend the maturity date and (iv) modify certain other
terms, including pricing. The credit facility is being used for general
corporate purposes including acquisitions and affiliations. Borrowings under
this line of credit bear interest at either prime or LIBOR plus a margin, at our
option. The margin for LIBOR loans is based upon our debt coverage ratio and
ranges up to 1.625%. In addition, we pay a commitment fee of 0.25% of the
average daily balance of the unused line. Borrowings are limited to an
availability formula based on adjusted EBITDA. The credit facility is secured by
a first lien on substantially all of our assets, including a pledge of the stock
of our subsidiaries. We are also required to comply with certain financial and
other covenants. The line of credit matures in December 2001. The outstanding
balance under this line as of March 31, 1999 was $13,897,000.

     We have a Shelf Registration Statement on file with the Securities and
Exchange Commission (Registration No. 333-56941) covering a total of 750,000
shares of Common Stock and $25,000,000 aggregate principal amount of
subordinated promissory notes to be issued in connection with future dental
group practice affiliations. As of March 31, 1999, 679,878 shares and
$23,805,000 of notes remain available for issuance under this Shelf Registration
Statement.

     We believe that cash generated from operations and amounts available under
our revolving credit facility will be sufficient to fund our anticipated cash
needs for working capital, capital expenditures and acquisitions and
affiliations for at least the next 12 months.

Year 2000 Issue

     The Year 2000 issue is the result of certain computer programs being
written using two digits rather than four digits to define the year.
Accordingly, computer programs that have date-sensitive software may recognize a
date using "00" as the year 1900 rather than 2000. This could result in system
failures or miscalculations causing disruptions in operations, including the
temporary inability to process transactions, send invoices or statements, or
engage in similar normal business activities. We utilize software and related
computer technologies essential to our operations.

     All significant operating systems, the general ledger system and network
communication software system utilized by us are either already Year 2000
compliant or are expected to be Year 2000 compliant upon installation of
available patches or upgrades at minimal to no cost. The general ledger system
has already been satisfactorily tested for compliance by the software vendor. We
expect that all necessary upgrades for significant operating systems and network
communication software will be completed by the end of the second quarter of
1999.

                                       13
<PAGE>
 
                        AMERICAN DENTAL PARTNERS, INC.
                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS  (Continued)


     We also use various dental practice management software systems in our
affiliated dental group practices. In particular, our proprietary practice
management system, Comdent, which is currently used at 38 of our dental
facilities, is Year 2000 compliant. We intend, when appropriate, to convert our
current and future affiliated dental group practices to Comdent. In general, the
other practice management systems utilized by us are commercially available
systems that are either already Year 2000 compliant or scheduled for Year 2000
compliance by the end of the third quarter of 1999. Preliminary compliance
testing has been done by us on Comdent and other significant practice management
systems and we intend to complete all such testing by the end of the second
quarter of 1999. Any systems deemed to be non-compliant at such time are 
expected to be converted to Year 2000 compliant systems by the end of 1999. As
part of our due diligence in connection with future affiliations, we will
perform a review of the dental practice management software systems being used
by those dental practices for Year 2000 compliance. Continual system upgrades
and conversion of dental practice management systems to our preferred systems is
an integral part of our overall information systems strategy. We believe that
costs specifically associated with Year 2000 compliance issues, if any, will not
be material to our financial position or results of operations.

     We are still in the process of identifying potential compliance issues with
non-information technology ("non-IT") systems such as phone systems and
certain other equipment. We do not believe the failure of such systems would
have a material adverse effect on our operations. Non-IT systems that are not
compliant, if any, are expected to be upgraded or replaced by the end of the
third quarter of 1999. The costs of such upgrades are not expected to be
material to our financial position or results of operations.

     Year 2000 issues also relate to third parties with which we have
significant relationships. In particular, our affiliated dental groups have
contracts with third party payors to provide dental services in exchange for
capitation, fee-for-service and PPO payments. These third party payors have
systems that may be vulnerable to Year 2000 issues. We have identified and
initiated discussions with all significant third party payors to determine their
compliance status and develop appropriate contingency plans. There can be no
assurance, however, that the systems of these significant third party payors
will be Year 2000 compliant on a timely basis. We believe Year 2000 problems
experienced by such third party payors is the most reasonably likely worst case
scenario and that such problems could result in late payments received under the
payor contracts and related cash flow problems. Potential contingency plans may
include temporary advancing of funds to our affiliates by third party payors
unable to process claims on a timely basis and the direct billing of patients in
lieu of reimbursements under the payor contracts. In addition, we could, if
necessary, use borrowings under our revolving credit facility to support working
capital obligations in the event of payment problems from third party payors.
Due to the dependence of our affiliated dental groups on third party payor
relationships, Year 2000 system failures of such payors could have a material
adverse effect on our cash flows and financial condition.

                                       14
<PAGE>
 
                        AMERICAN DENTAL PARTNERS, INC.
                  PART I.  FINANCIAL INFORMATION  (Continued)

Item 3.  Quantitative and Qualitative Disclosures About Market Risk

         Not applicable.

 


                          PART II.  OTHER INFORMATION
                                        


Item 1.  Legal Proceedings

         From time to time, we may be subject to litigation incidental to our
business. We are not presently a party to any material litigation. The dentists
employed by, or independent contractors of, our affiliated dental group
practices are from time to time subject to malpractice claims. Such claims, if
successful, could result in damage awards exceeding applicable insurance
coverage which could have a material adverse effect on our business, financial
condition and results of operations.


Item 2.  Changes in Securities and Use of Proceeds

         Not applicable


Item 3.  Defaults Upon Senior Securities

         Not applicable.


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

         Not applicable.


Item 5.  Other Information

         Not applicable.


Item 6.  Exhibits and Reports on Form 8-K

         (a)  Exhibits

              (27)  Financial Data Schedule.

         (b)  Reports on Form 8-K

              We filed a Current Report on Form 8-K dated as of February 8, 1999
              related to the acquisition of certain non-clinical assets of the
              dental facilities formerly part of CIGNA HealthCare of Arizona,
              Inc. in Phoenix.

                                       15
<PAGE>
 
                        AMERICAN DENTAL PARTNERS, INC.

                                  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.



May 12, 1999                     AMERICAN DENTAL PARTNERS, INC.


                                 /s/  Gregory A. Serrao
                                 -----------------------------------------------
                                 Gregory A. Serrao
                                 Chairman, President and Chief Executive Officer



May 12, 1999                     /s/  Ronald M. Levenson
                                 -----------------------------------------------
                                 Ronald M. Levenson
                                 Senior Vice President,
                                 Chief Financial Officer and Treasurer
                                 (principal financial officer)

                                       16
<PAGE>
 
                        AMERICAN DENTAL PARTNERS, INC.
                                        
                                 EXHIBIT INDEX
                                 -------------


Exhibit
Number                          Exhibit Description
------                          -------------------

 **10(r)  Amended and Restated Service Agreement dated January 1, 1999, between
          PDHC, Ltd. and PDG, P.A.

 **10(s)  Amended and Restated Service Agreement dated January 1, 1999, between
          Smileage Dental Care, Inc. and Wisconsin Dental Group, S.C.

  +10(ee) Amended and Restated Asset Purchase Agreement dated February 8, 1999,
          among American Dental Partners, Inc., Innovative Practice Concepts,
          Inc., Associated Dental Care Providers, P.C., CIGNA HealthCare of
          Arizona, Inc. and CIGNA Dental Health, Inc.

**#10(ff) Employment and Noncompetition Agreement dated January 1, 1999, between
          American Dental Partners, Inc. and Joseph V. Errante, D.D.S.

  *27     Financial Data Schedule.


__________________________
*    Filed herewith.

**   Previously filed as an exhibit to our Annual Report on Form 10-K filed with
     the Securities and Exchange Commission on March 9, 1999 and incorporated
     herein by reference. For Exhibits 10(r) and 10(s), certain portions of
     these exhibits have been omitted pursuant to confidential treatment granted
     under Rule 406 of the Securities Act.

+    Previously filed as Exhibit 2 to our Current Report on Form 8-K filed with
     the Securities and Exchange Commission on February 18, 1999 and
     incorporated herein by reference.

#    Management contracts or compensatory plans or arrangements.

                                       17