SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

(Mark One)

[X]     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
        EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2003

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

                         Commission file number 0-21271

                       SANGUI BIOTECH INTERNATIONAL, INC.
             (Exact Name of Registrant as Specified in its Charter)

                   COLORADO                                      84-1330732
      (State or other jurisdiction of                        (I.R.S.  Employer
        incorporation or organization)                       Identification No.)

                            Alfred-Herrhausen-Str. 44
                                  58455 Witten
                                     Germany

   (Address of Principal Executive Offices)                    (Zip Code)
   Registrant's Telephone Number, Including Area Code:     011-49-2302-915-204

                                  ___________

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days. Yes [ X ] No [ ]

Indicate the number of shares outstanding of each of the issuer's class of
common stock, as of the latest practicable date:

Title of each class of Common Stock              Outstanding at October 31, 2003
-----------------------------------------        -------------------------------
  Common  Stock,  no par  value                           40,655,363


Transitional  Small  Business  Disclosure  Format

(Check one);

Yes  [ ]   No  [X]

<PAGE>

INDEX


                       SANGUI BIOTECH INTERNATIONAL, INC.

                       PART  I.  FINANCIAL  INFORMATION

Item 1.  Financial Statements

         Consolidated Balance Sheet at September 30, 2003 (Unaudited)........3

         Consolidated Statements of Operations and Comprehensive Loss
         (Unaudited) Three Months Ended September 30, 2003 and 2002..........4

         Consolidated Statements of Cash Flows(Unaudited)
         Three Months Ended September 30, 2003 and 2002......................5

         Notes to Consolidated Financial Statements (Unaudited)..............6

Item 2.  Management's Discussion and Analysis of Financial Condition
         and Results of Operations..........................................10

Item 3.  Controls and Procedures............................................11

                         PART  II.  OTHER  INFORMATION

Item 1.  Legal Proceedings..................................................12

Item 2.  Change in Securities and Use of Proceeds...........................12

Item 3.  Defaults Upon Senior Securities....................................12

Item 4.  Submission of Matters to a Vote of Securities Holders..............12

Item 5.  Other Information..................................................12

Item 6.  Exhibits and Reports on Form 8-K...................................12

                                       2
<PAGE>

                       SANGUI BIOTECH INTERNATIONAL, INC.
                           CONSOLIDATED BALANCE SHEET


                                     ASSETS

                                                                   SEPTEMBER 30,
                                                                      2003
                                                                   (UNAUDITED)
                                                                   -------------
Current assets

       Cash and cash equivalents                                    $  581,734
       Available for sale securities                                   811,177
       Taxes receivable                                                179,525
       Prepaid expenses and other assets                                79,486
                                                                    ----------
            Total current assets                                     1,651,922

Property and equipment-net                                             134,580

Patents and licenses-net                                                17,383

                                                                    ----------
Total assets                                                        $1,803,885
                                                                    ==========

                      LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities

       Accounts payable and accrued expenses                     $    122,552
                                                                 ------------

Commitments and contingencies

Stockholders' equity

       Preferred stock, no par value; 5,000,000 shares
       authorized, no shares issued and outstanding                        --
       Common stock,  no par value, 50,000,000 shares
       authorized, 40,655,363 shares issued and outstanding        18,345,491
       Additional paid-in capital                                   2,000,000
       Accumulated other comprehensive income                         504,154
       Accumulated deficit                                        (19,168,312)
                                                                 ------------

       Total stockholders' equity                                   1,681,333

                                                                 ------------
Total liabilities and stockholders' equity                       $  1,803,885
                                                                 ============

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

                                       3
<PAGE>

                       SANGUI BIOTECH INTERNATIONAL, INC.

          CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

<TABLE>
<CAPTION>
                                                                        FOR THE
                                                                   THREE MONTHS ENDED
                                                                      SEPTEMBER 30,
                                                                       (UNAUDITED)
                                                           --------------------------------------
                                                                2003                    2002
                                                           ------------              ------------
<S>                                                        <C>                       <C>
Revenues                                                   $         --              $         --
Operating expenses:
Research and development                                        184,107                   229,706
General and administrative                                      211,218                   274,602
Depreciation and amortization                                    30,970                    45,595
                                                           ------------              ------------

Total operating expenses                                        426,295                   549,903
Other income:
Interest income                                                   7,916                    15,141
Other income                                                      4,324                    47,112
                                                           ------------              ------------
Total other income                                               12,240                    62,253

Loss from continuing operations                                (414,055)                 (487,650)

Loss from discontinued operations                                    --                   (47,059)

                                                           ------------              ------------
Net loss                                                       (414,055)                 (534,709)
Other comprehensive income (loss):
Foreign currency translation adjustments                           (661)                 (209,224)
Unrealized gain (loss)on marketable securities                   12,109                   (61,646)
                                                           ------------              ------------
Comprehensive loss                                         $   (402,607)             $   (805,579)
                                                           ============              ============
Loss available to common
stockholders per common share - basic and diluted:
Loss from continuing operations                            $      (0.01)             $      (0.01)
                                                           ============              ============
Loss from discontinued operations                          $         --              $         --
                                                           ============              ============
Net loss                                                   $      (0.01)             $      (0.01)
                                                           ============              ============
Basic and diluted weighted average
number of common shares outstanding                          40,655,363                40,655,363
                                                           ============              ============
</TABLE>

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

                                       4
<PAGE>

                       SANGUI BIOTECH INTERNATIONAL, INC.

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                                                  FOR THE
                                                                                             THREE MONTHS ENDED
                                                                                                SEPTEMBER 30,
                                                                                                 (UNAUDITED)
                                                                                       --------------------------------
                                                                                           2003                 2002
                                                                                       -----------          -----------
<S>                                                                                    <C>                  <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss                                                                               $  (414,055)         $  (534,709)
Adjustments to reconcile net loss to net cash used in operating activities:
      Depreciation and amortization                                                         30,970               45,595
      Realized gains on sale of marketable securities                                           --              (34,263)
      Realized gain on sale of assets of discontinued operations                                --              (16,980)
      Loss on impairment of assets                                                              --              106,927
Changes in operating assets and liabilities:
      Accounts receivable                                                                       --               52,301
      Inventories                                                                               --               16,362
      Grant receivable                                                                          --               68,935
      Taxes receivable                                                                       3,295                   --
      Prepaid expenses and other assets                                                     11,930               95,678
      Accounts payable and accrued expenses                                                 (3,264)            (224,052)
                                                                                       -----------          -----------

Net cash used in operating activities                                                     (371,124)            (424,206)
                                                                                       -----------          -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
      Increase in marketable securities                                                         --             (682,607)
      Maturities of marketable securities                                                       --            1,117,898
      Purchase of property and equipment                                                    (1,830)             (21,150)
                                                                                       -----------          -----------

Net cash provided by (used in) investing activities                                         (1,830)             414,141
                                                                                       -----------          -----------

Effect of exchange rate changes                                                             (1,843)            (209,224)
                                                                                       -----------          -----------

Net decrease in cash and cash equivalents                                                 (374,797)            (219,289)

Cash and cash equivalents, beginning of period                                             956,531              832,130
                                                                                       -----------          -----------

Cash and cash equivalents, ending of period                                            $   581,734          $   612,841
                                                                                       ===========          ===========
Supplemental disclosures:
      Cash paid during the period for:
      Interest                                                                         $        --          $        --
                                                                                       ===========          ===========
      Income taxes                                                                     $        --          $        --
                                                                                       ===========          ===========
</TABLE>

During the quarter ended September 30, 2002, the Company recorded a note
receivable for $60,000 from the sale of inventory and equipment related to its
discontinued operations, which is recorded in prepaid expenses and other assets.

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

                                       5
<PAGE>

                       SANGUI BIOTECH INTERNATIONAL, INC.
             Notes to Consolidated Financial Statements (Unaudited)

NOTE 1 - BASIS OF PRESENTATION
------------------------------

The  accompanying  consolidated financial statements have been prepared without
audit in accordance with accounting principles generally accepted in the United
States of America for  interim  financial information and with the instructions
to  Form  10-QSB  and  Item 301 of Regulation  S-B.   Certain  information  and
footnote disclosures normally  included  in  financial  statements  prepared in
accordance  with accounting principles generally accepted in the United  States
of  America  have  been  condensed  or  omitted  pursuant  to  such  rules  and
regulations.  The unaudited consolidated financial statements and notes should,
therefore, be  read  in  conjunction with the consolidated financial statements
and notes thereto in the Company's  Form  10-KSB  for  the  year ended June 30,
2003.  In the opinion of management, all adjustments (consisting  of normal and
recurring adjustments) considered necessary for a fair presentation,  have been
included.  The results of operations for the three month period ended September
30,  2003  are not indicative of the results that may be expected for the  full
fiscal year ending June 30, 2004.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
---------------------------------------------------

Nature of Business
------------------

Sangui BioTech  International,  Inc.,  incorporated in Colorado in 1995, and its
subsidiaries  (collectively,  the ("Company") have been engaged in the research,
development, manufacture, and sales of medical products.

SanguiBioTech AG ("Sangui AG"), the Company's German  subsidiary,  is engaged in
the  development  of  artificial  oxygen  carriers  (external   applications  of
hemoglobin,  blood substitute and blood additives) as well as in the development
of glucose implant sensors.  On June 30, 2003,  GlukoMediTech  AG, the Company's
German subsidiary, was merged into Sangui AG.

The operations of Sangui BioTech, Inc. ("Sangui USA"), a wholly owned subsidiary
of the Company, were discontinued during 2002.

The  operations  of Sangui  Singapore,  incorporated  in  Singapore in 1999 as a
regional office for the Company, were discontinued during 2002.

Consolidation
-------------

The  consolidated  financial  statements  include the accounts of Sangui BioTech
International,   Inc.  and  its  wholly  owned  subsidiaries.   All  significant
intercompany  accounts and transactions  have been eliminated in  consolidation.
Certain  amounts  in the  three  months  ended  September  30,  2002  have  been
reclassified   to  conform  to  the  three  months  ended   September  30,  2003
presentation.  These reclassifications have no effect on the previously reported
net loss.

Use of Estimates
----------------

The preparation of financial statements in conformity with accounting principles
generally  accepted in the United States of America requires  management to make
estimates  and  assumptions  that  affect  the  reported  amounts  of assets and
liabilities  and disclosure of contingent  assets and liabilities at the date of
the  financial  statements  and the  reported  amounts of revenues  and expenses
during the respective  reporting period.  Actual results could differ from those
estimates.  Significant  estimates  made by management  are,  among others,  the
realization  of  receivables,  long-lived  assets,  and  valuation  allowance on
deferred tax assets.

Risk and Uncertainties
----------------------

The Company's line of future pharmaceutical products (artificial oxygen carriers
or blood  substitute  and  additives) and in vivo  biosensors  (glucose  implant
sensor)  being  developed  by Sangui  AG,  are  deemed  as  medical  devices  or
biologics,  and as such are governed by the Federal Food and Drug and  Cosmetics
Act and by the  regulations  of state  agencies and various  foreign  government
agencies.  The  pharmaceutical  and biosensor  products,  under  development  in
Germany, will be subject to more stringent regulatory requirements, because they
are in vivo  products  for  humans.  The Company  and its  subsidiaries  have no
experience  in  obtaining  regulatory  clearance  on these  types  of  products.
Therefore,  the Company  will be subject to the risks of delays in  obtaining or
failing to obtain regulatory clearance.

                                       6
<PAGE>

The accompanying  consolidated  financial statements have been prepared assuming
the Company will continue as a going concern,  which  contemplates,  among other
things,  the realization of assets and satisfaction of liabilities in the normal
course of business.  The Company has  accumulated  deficit of  $19,168,312 as of
September 30, 2003 and has been significantly reducing its working capital since
June 30, 2003. The Company's management believes, based on its current operating
plan,  that its current cash and highly liquid  marketable  securities  totaling
approximately  $1.4 million at September  30, 2003,  are  sufficient to fund the
Company's operations and working capital requirements at least through September
30, 2004.  There are no  assurances,  however,  that the Company  will  generate
sufficient  cash  flows  from  operations  or  complete  any sales or  financing
transactions or, even if such transactions are completed,  have sufficient funds
to execute  its  intended  business  plan over an extended  period of time.  The
accompanying  financial  statements do not include any adjustments that might be
necessary should the Company be unable to continue as a going concern.

Foreign Currency Translation
----------------------------

Assets and liabilities of the Company's  foreign  operations are translated into
U.S.  dollars  at  period-end  exchange  rates.  Net  exchange  gains or  losses
resulting from such  translation  are excluded from net loss but are included in
comprehensive   income  (loss)  and  accumulated  in  a  separate  component  of
stockholders'  equity.  Income and expenses are  translated at weighted  average
exchange rates for the period.

Cash and Cash Equivalents
-------------------------

The  Company  maintains  its cash in bank  accounts  in  Germany.  Cash and cash
equivalents  include time deposits for which the Company has no requirements for
compensating  balances.  The  Company  has not  experienced  any  losses  in its
uninsured bank accounts.

Marketable Securities
---------------------

Marketable securities are classified as available-for-sale. Unrealized gains and
losses are excluded  from net loss and are  reported as a separate  component of
accumulated other comprehensive income in stockholders'  equity.  Realized gains
and losses are included in other income and are determined based on the specific
identification of the securities bought and sold (see Note 3).

Revenue Recognition
-------------------

Revenues from product sales are recognized at the time of shipment.

Research and Development
------------------------

Research and  development  costs are charged to operations as they are incurred.
Legal fees and other direct costs incurred in obtaining and  protecting  patents
are expensed as incurred.

Basic and Diluted Loss Per Common Share
---------------------------------------

Basic loss per common  share is computed by dividing  loss  available  to common
stockholders by the weighted average number of common shares  outstanding during
the period of computation.  Diluted loss per share gives effect to all potential
dilutive  common  shares  outstanding  during  the period of  compensation.  The
computation  of diluted loss per share does not assume  conversion,  exercise or
contingent  exercise of  securities  that would have an  antidilutive  effect on
earnings.  As of  September  30, 2003 and 2002,  the Company had no  potentially
dilutive  securities  that  would  effect  the loss per share if they were to be
dilutive.

                                       7
<PAGE>

Comprehensive Income (Loss)
---------------------------

Total  comprehensive  income (loss)  represents the net change in  stockholders'
equity during a period from sources other than  transactions  with  stockholders
and as such,  includes net earnings (loss).  For the Company,  the components of
other  comprehensive  income  (loss) are the changes in the  cumulative  foreign
currency  translation  adjustments  and unrealized  gains (losses) on marketable
securities and are recorded as components of stockholders' equity.

Segments of an Enterprise and Related Information
-------------------------------------------------

The Company applies  Statement of Financial  Accounting  Standards  ("SFAS") No.
131, "Disclosures about Segments of an Enterprise and Related Information". SFAS
No. 131 establishes  standards for the way public companies  report  information
about  segments  of their  business in their  annual  financial  statements  and
requires them to report selected segment  information in their quarterly reports
issued to  shareholders.  It also  requires  entity-wide  disclosures  about the
products and  services an entity  provides,  the material  countries in which it
holds assets and reports revenues and its major customers (see Note 6).

New Accounting Pronouncements
-----------------------------

In May 2003, the Financial  Accounting  Standards Board ("FASB") issued SFAS No.
150, "Accounting for Certain Financial  Instruments with Characteristics of Both
Liabilities and Equity".  SFAS No. 150  establishes  standards for how an issuer
classifies and measures certain financial  instruments with  characteristics  of
both  liabilities  and equity.  It requires that an issuer  classify a financial
instrument  that is  within  its  scope  as a  liability  (or an  asset  in some
circumstances). SFAS No. 150 is effective for financial instruments entered into
or modified  after May 31, 2003,  and otherwise is effective at the beginning of
the first interim period  beginning after June 15, 2003. It is to be implemented
by reporting the  cumulative  effect of a change in an accounting  principle for
financial instruments created before the issuance date of SFAS No. 150 and still
existing at the beginning of the interim period of adoption.  Restatement is not
permitted.  The  adoption of SFAS No. 150 did not have a material  effect on the
Company's consolidated financial statements.

NOTE 3 - AVAILABLE FOR SALE SECURITIES
--------------------------------------
Available for sale securities consist of the following at September 30, 2003:

                                       Cost   Fair market value  Unrealized Gain

Corporate bonds due within one year  $680,612      $811,177           $130,565
                                     ========      ========           ========

NOTE 4  - DISCONTINUED OPERATIONS
---------------------------------

Sangui  USA  manufactured  in vitro  immunodiagnostic  blood test kits that were
primarily  sold  in the  United  States  and  Europe.  The  Company  decided  to
discontinue the in vitro immunodiagnostics  business in August 2002, sold Sangui
USA's  inventory and property and  equipment to an unrelated  party for $60,000,
and  closed  the  facility.  The sale  resulted  in a gain of  $16,980  which is
included  as part of  loss  from  discontinued  operations  in the  accompanying
statements of operations for the three months ended  September 30, 2002. In July
2002,  the  Company  received   $100,000  as  part  of  an  agreement  to  cease
manufacturing and selling certain blood test kits which is included in loss from
discontinued  operations in the  accompanying  statements of operations  for the
three months ended  September 30, 2002. The Company  decided to discontinue  the
operations of Sangui  Singapore in August 2002,  recorded an impairment  loss on
property and equipment of $106,927,  and closed the facility  effective December
31, 2002.

Components of amounts reflected in the accompanying  consolidated  statements of
operations and comprehensive  loss for the three months ended September 30, 2002
are presented below:
                                                   2002
                                                  ------
                                            Sangui       Sangui
                                             USA        Singapore       Total
                                          ---------     ----------    ---------
Sales                                     $ 138,542     $    --       $ 138,542
Cost of sales                                94,747          --          94,747
Operating expenses                           76,060        24,487       100,907
                                          ---------     ----------    ---------
Loss from continuing
operations                                  (32,265)      (24,487)      (57,112)
Other income                                116,980          --         116,980
Impairment
of assets                                      --        (106,927)     (106,927)
                                          ---------     ---------     ---------
Income(loss) from discontinued
operations
                                          $  84,715     $(131,774)    $ (47,059)
                                          =========     =========     =========

                                       8
<PAGE>

NOTE 5 - COMMITMENTS AND CONTINGENCIES
--------------------------------------

Litigation
----------

The Company may, from time to time, be involved in various litigation resulting
from the ordinary course of operating its business. Management is currently not
able  to predict the outcome of any such cases.  However,  management  believes
that the  amount  of  ultimate  liability, if any, with respect to such actions
will not have a material effect on  the Company's financial position or results
of operations.

Indemnities and Guarantees
--------------------------

During the normal course of business,  the Company has made certain indemnities
and guarantees under which it may be required  to  make payments in relation to
certain transactions.  These indemnities include certain  agreements  with  the
Company's  officers,  under which the Company may be required to indemnify such
person for liabilities  arising  out  of  their  employment  relationship.  The
duration of these indemnities and guarantees varies and, in certain  cases,  is
indefinite.   The  majority  of these indemnities and guarantees do not provide
for any limitation of the maximum  potential  future payments the Company could
be obligated to make.  Historically, the Company has not been obligated to make
significant  payments  for  these  obligations and  no  liabilities  have  been
recorded for these indemnities and guarantees  in the accompanying consolidated
balance sheet.

NOTE 6 - BUSINESS SEGMENTS
--------------------------

The Company reports it business segments based on geographic regions, which are
as follows as of September 30, 2003 and for the  three  months  ended September
30, 2003 and 2002:

                                                        2003            2002
                                                     -----------    -----------
NET SALES
Sangui AG                                            $      --      $      --
Sangui BioTech International, Inc.                          --             --
Sangui USA (included in discontinued operations)            --          138,542
Sangui Singapore                                            --             --
                                                     -----------    -----------
                                                     $      --      $   138,542
                                                     ===========    ===========
NET INCOME (LOSS)
Sangui AG                                            $  (364,173)   $  (398,328)
Sangui BioTech International, Inc.                       (49,882)       (89,322)
Sangui USA                                                  --           84,715
Sangui Singapore                                            --         (131,774)
                                                     -----------    -----------
                                                     $  (414,055)   $  (534,709)
                                                     ===========    ===========
DEPRECIATION AND AMORTIZATION
Sangui AG                                            $    30,970    $    45,595
Sangui BioTech International, Inc.                          --             --
Sangui USA                                                  --             --
Sangui Singapore                                            --             --
                                                     -----------    -----------
                                                     $    30,970    $    45,595
                                                     ===========    ===========
IDENTIFIABLE ASSETS
Sangui AG                                            $ 1,653,117
Sangui BioTech International, Inc.                       150,768
Sangui USA                                                  --
Sangui Singapore                                            --
                                                     -----------
                                                     $ 1,803,885
                                                     ===========
                                       9
<PAGE>

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

Forward-looking Statements
--------------------------

The following  discussion  of our financial  condition and results of operations
should be read in conjunction with the consolidated financial statements and the
related notes thereto included  elsewhere in this quarterly report.  Some of the
information  in  this  quarterly  report  contains  forward-looking  statements,
including statements related to anticipated operating results,  margins, growth,
financial resources,  capital requirements,  adequacy of the Company's financial
resources,  trends in spending on research and  development,  the development of
new markets, the development,  regulatory approval,  manufacture,  distribution,
and  commercial  acceptance  of new  products,  and future  product  development
efforts.  Investors are cautioned that forward-looking  statements involve risks
and  uncertainties,  which may affect our business and prospects,  including but
not limited  to, the  Company's  expected  need for  additional  funding and the
uncertainty of receiving the additional funding,  changes in economic and market
conditions,  acceptance  of our  products by the health  care and  reimbursement
communities,   new   development   of  competitive   products  and   treatments,
administrative and regulatory approval and related  considerations,  health care
legislation and regulation,  and other factors discussed in our filings with the
Securities and Exchange Commission.

GENERAL
-------

The  Company is  primarily  involved in the  development  of  artificial  oxygen
carriers and glucose sensors.

The Company's  clinical  development  projects are primarily in the  preliminary
stages.  The  Company is  diligently  developing  several  applications  for its
clinical development projects,  but does not anticipate beginning any government
protocols or clinical trials in the near term. In the course of the ongoing cost
containment  efforts,  these  projects  were halted during the last fiscal year,
after having  achieved  the planned  milestones.  The Company  decided to reduce
further expenditures in the blood substitute,  blood additive and glucose sensor
projects to the amount  necessary to find financing,  industrial or distribution
partners for further development and marketing of the resulting products.

The  Company's  development  projects  related to cosmetic  applications  of its
oxygen carrier are nearing completion.  The Company has established contact with
a German  cosmetics  vendor and is planning and  preparing to jointly  introduce
this  application as a cosmetic  anti-aging  product in the German market in the
course of the current fiscal year.

Cost Savings
------------

In total, management has been able to reduce the Company's operating expenses by
23% to approximately $426,000 in the first three months of fiscal 2004, compared
to approximately $550,000 in the respective period of last fiscal year. Research
and  development  expenses  and general and  administrative  expenses  have been
reduced by 20% and 23%,  respectively,  in the first three months of fiscal 2004
as compared to the  respective  period of last fiscal year.  This effort is also
reflected in the net cash used in operating  activities  which  decreased 13% to
approximately  $371,000  compared  to  approximately  $424,000  net cash used in
operating  activities in the respective  period of last fiscal year.  Management
assumes that the current  planning is realistic and that the Company's funds and
liquidity are  sufficient to finance its  activities at least through the period
ending September 30, 2004.

FINANCIAL POSITION
------------------

The Company's current assets  decreased  approximately  $378,000,  or 19%, from
June 30, 2003 to approximately $1.7 million at September 30, 2003. The decrease
is  primarily  attributable  to  a  decrease  in  cash and cash equivalents  of
approximately  $375,000.  The  decrease  in cash and cash  equivalents  results
primarily from funding the current year's  operations  of  the  Company with no
revenues in the three month period ended September 30, 2003.

The Company's net property and equipment decreased approximately $25,000, or 16%
from June 30, 2003 to approximately $135,000 at September 30, 2003. The decrease
is primarily attributable to current year depreciation of approximately $31,000.

The Company funded its operations primarily through its existing cash reserves.
The  Company's  stockholders'  equity  decreased  approximately $403,000.   The
primary  decrease  is  caused  by  the Company's current  period  net  loss  of
approximately  $414,000, and an increase  in  accumulated  other  comprehensive
income of approximately $12,000 due to foreign currency translation adjustments
and unrealized gains on marketable securities.

                                       10
<PAGE>

RESULTS OF OPERATIONS
---------------------

Three months ended September 30, 2003 and 2002:

Sangui AG
---------

RESEARCH AND  DEVELOPMENT.  Research and development  expenses  decreased 19% to
approximately $184,000 in 2003 from approximately $230,000 in 2002. The decrease
is due to the refocusing of research and development activities.

GENERAL AND ADMINISTRATIVE. General and administrative expenses decreased 11% to
approximately  $161,000  in 2003  from  approximately  $182,000  in  2002.  This
decrease is mainly attributed to decreased legal fees.

DEPRECIATION.  Depreciation  decreased 32% to approximately $31,000 in 2003 from
approximately $46,000 in 2002. This decrease is mainly attributed to the ongoing
restructuring of the German subsidiary.

Sangui BioTech International, Inc.
----------------------------------

GENERAL AND ADMINISTRATIVE. General and administrative expenses decreased 46% to
approximately  $50,000  in 2003  from to  approximately  $93,000  in  2002.  The
decrease is due to decreased consulting and legal fees.

Consolidated
------------

NET  LOSS.  As a result  of the above  factors  and the loss  from  discontinued
operations (see Note 4), the Company's  consolidated net loss was  approximately
$414,000,  or $0.01  per  common  share,  in  2003,  compared  to  approximately
$535,000, or $0.01 per common share, in 2002.

LIQUIDITY AND CAPITAL RESOURCES
-------------------------------

For the three months ended  September  30,  2003,  net  cash  used in operating
activities decreased to approximately $371,000 from approximately  $424,000  in
the  corresponding  period  in  2002,  primarily  related  to a decrease in the
Company's consolidated net loss as a result of the ongoing refocusing program.

For the three  months  ended  September  30,  2003,  net cash used in  investing
activities was approximately $2,000 compared to approximately  $414,000 net cash
provided  by  investing  activities  in the  corresponding  period in 2002.  The
principal decrease is due to the maturity of marketable securities and purchases
of  marketable  securities  in  2002.  There  was no  maturity  or  purchase  of
marketable securities in 2003.

Working capital was approximately $1.5 million at September 30, 2003, a decrease
of  approximately  $400,000  million  from June 30,  2003 due  primarily  to the
Company's  net loss for the three month  period.  A  substantial  portion of the
Company's total assets consists of cash and highly liquid marketable  securities
classified as available for sale  securities.  The highly liquid nature of these
assets  provides the Company  with  flexibility  in  financing  and managing its
business.  For the three months ended September 30, 2003, there were no realized
gains  on  the  Company's  marketable   securities  and  unrealized  gains  were
approximately $131,000.

At September 30, 2003, the Company had cash and liquid marketable  securities of
approximately $1.4 million. The Company believes that its available cash will be
sufficient  to satisfy  its  requirements  at least  through  the period  ending
September  30,  2004.  However,  the Company  will need  substantial  additional
funding to fulfil its business plan and the Company intends to explore financing
sources for its future  development  activities.  No assurance can be given that
these efforts will be successful.

ITEM 3 - CONTROLS AND PROCEDURES
--------------------------------

As of September 30, 2003, an evaluation was performed  under the supervision and
with the participation of the Company's  management,  including the CEO/CFO,  of
the  effectiveness  of the  design and  operation  of the  Company's  disclosure
controls and procedures.  Based on that  evaluation,  the Company's  management,
including  CEO/CFO,   concluded  that  the  Company's  disclosure  controls  and
procedures  were  effective  as of  September  30,  2003.  There  have  been  no
significant  changes in the Company's internal controls or in other factors that
could significantly affect internal controls subsequent to September 30, 2003.

                                       11
<PAGE>

ITEM 4 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
-------------------------------------------------------------------

The  Company  has no  derivative  financial  instruments.  Exposure  to  foreign
currency exchange rates is limited,  as the Company has no operating business or
staff outside Germany since December 31, 2002.

PART II - OTHER INFORMATION
---------------------------

ITEM 1 - LEGAL PROCEEDINGS
--------------------------

On July 26,  2001,  the Company  filed a lawsuit in the United  States  District
Court for the  District of Colorado  against  Helmut  Kappes,  a director of the
Company.  In the  lawsuit,  the Company  alleged  that Mr.  Kappes is engaged in
conduct  related to the Company's  affairs that is  fraudulent,  dishonest and a
gross abuse of his  authority or  discretion  as a director and that his removal
from the  Company's  Board of  Directors  would be in the best  interest  of the
Company.  In October 2002, the Court granted the motion of counsel to Mr. Kappes
to withdraw from  representation of Mr. Kappes.  Upon consideration by the Board
of Directors of the legal costs to prosecute  the claims  against Mr. Kappes and
the  likelihood of being able to collect on any obtained  judgment,  the Company
has requested its attorneys to take the steps necessary to dismiss the liability
claim. On November 5, 2003, the Court has issued an order to dismiss the lawsuit
without prejudice.

ITEM 2 - CHANGE IN SECURITIES AND USE OF PROCEEDS
-------------------------------------------------
None

ITEM 3 - DEFAULTS UPON SENIOR SECURITIES
----------------------------------------

Not applicable

ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS
--------------------------------------------------------------

Not applicable

ITEM 5 - OTHER INFORMATION
--------------------------

As of July 9, 2003,  Dr.  Christoph  Ludz and Dr.  Markus  Volpers  were elected
Directors of Sangui BioTech International, Inc.

As of  September  15,  2003,  Dora Malek has  resigned  from her  position  as a
Director  of  Sangui  BioTech  International,  Inc.  as well as from  all  other
positions she held within the Company and its subsidiaries.

As of July 30, 2003, it was resolved to convert the Company's German  subsidiary
to a public  limited  company under German law (GmbH).  The pertinent  documents
have been filed with the Registry Court in Witten,  Germany.  The conversion was
registered effective November 4, 2003.

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

31.1 Certification Pursuant to Rule 13a-14(a) and 15d-14(a), filed herewith.

32.  Certification  Pursuant  to Section  1350 of Title 18 of the United  States
Code, filed herewith.

                                       12
<PAGE>

SIGNATURES
----------

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

SANGUI BIOTECH INTERNATIONAL, INC.
----------------------------------

By: /s/ Wolfgang Barnikol
    -----------------------------------------
     Wolfgang Barnikol
     President, Chief Executive Officer and
     Chief Financial Officer

Date: November 13, 2003

                                       13