##### 



FORM 10-QSB

U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

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

|                                |  |                
|------------------------------- |  | ---------------
|For the quarterly period ended: |  | Commission file
|September 30, 2002              |  | Number 0-26150 

MILE MARKER INTERNATIONAL, INC.




(Exact Name Of Small Business Registrant As Specified In Its Charter)


|                                               |  |                                     
|---------------------------------------------- |  | ------------------------------------
|Florida                                        |  | 11-2128469                          
|                                               |  |                                     
|(State or other jurisdiction of
incorporation) |  | (IRS Employer Identification Number)

1450 S.W. 13th Court, Pompano Beach, Florida 33069




(Address of principal executive offices)


Registrants Telephone Number: (954) 782-0604

Indicate by check mark whether the Registrant (1) has filed all documents
and reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or 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   o

APPLICABLE ONLY TO CORPORATE ISSUERS

On September 30, 2002, the Registrant had outstanding 10,295,857 shares of
common stock, $.001 par value.





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##### 



MILE MARKER INTERNATIONAL, INC.

RISKS AND UNCERTAINTIES

Current and potential shareholders should consider carefully the risk factors
described below. Any of these factors, or others, many of which are beyond the
Companys control, could negatively affect the Companys revenues,
profitability or cash flows in the future. These factors include:



| |  |  | Demand for the Companys products in general and from the U.S. Government
in particular.                                          
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | Magnitude of price and product competition for the Companys products.                                                            
|
| |  |  | Effects of the weather and natural disasters on the demand for the
Companys products.                                            
|
| |  |  | Effects of foreign political, economic or military developments on
the Companys
international customer or supplier relationships.
|
| |  |  | Ability to control costs and expenses.                                                                                            
|
| |  |  | Ability to retain qualified personnel.                                                                                            
|
| |  |  | Ability to develop and introduce new or enhanced versions of the
Companys products.                                              

FORWARD-LOOKING STATEMENTS

When used in this Quarterly Report on Form 10-QSB or in future filings by the
Company (as hereinafter defined) with the Securities and Exchange Commission,
in the Companys press releases or other public or shareholder communications,
or in oral statements made with the approval of an authorized executive
officer, the words or phrases will likely result, are expected to,  will
continue, is anticipated, estimate, project, or similar expressions
are intended to identify forward-looking statements. The Company wishes to
caution readers not to place undue reliance on any such forward-looking
statements, which speak as of the date made, and to advise readers that various
factors, including regional and national economic conditions, substantial
changes in levels of market interest rates, credit and other risks of
manufacturing, distributing or marketing activities, and competitive and
regulatory factors could affect the companys financial performance and could
cause the Companys actual results for future periods to differ materially from
those anticipated by any forward-looking statements.

The Company does not undertake and specifically disclaims any obligation to
update any forward-looking statements to reflect the occurrence of anticipated
or unanticipated events or circumstances after the date of such statements.

-2-



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##### 



MILE MARKER INTERNATIONAL, INC.

INDEX

|                                                            |                                                                                                              |  |          |   | 
|----------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------ |  | -------- | - | 
|                                                            |                                                                                                              |  | Page No.
|                                                            |                                                                                                              |  |         
|PART I FINANCIAL INFORMATION                                |                                                                                                              |  |          |  
|Item 1. Financial Statements:                               |                                                                                                              |  |          |  
|                                                            | Consolidated Condensed Balance Sheets, September 30, 2002
and December 31, 2001                              |  |          | 4 | 
|                                                            | Consolidated Condensed Statements of Income, Three months
ended September 30, 2002 and September 30, 2001    |  |          | 5 | 
|                                                            | Consolidated Condensed Statements of Income, Nine months
ended September 30, 2002 and September 30, 2001     |  |          | 6 | 
|                                                            | Consolidated Condensed Statements of Cash Flows, Nine
months ended September 30, 2002 and September 30, 2001 |  |          | 7 | 
|                                                            | Notes to Consolidated Condensed Financial Statements                                                         |  |          | 8 | 
|Item 2. Managements Discussion or Plan of Operation        |                                                                                                              |  | 9-11     |  
|Item 3. Controls and Procedures                             |                                                                                                              |  | 12       |  
|PART II OTHER INFORMATION                                   |                                                                                                              |  |          |  
|Item 1. Legal Proceedings                                   |                                                                                                              |  | 12       |  
|Item 2. Changes in Securities                               |                                                                                                              |  | 12       |  
|Item 3. Defaults Upon Senior Securities                     |                                                                                                              |  | 12       |  
|Item 4. Submission of Matters to a Vote of Security Holders |                                                                                                              |  | 12       |  
|Item 5. Other Information                                   |                                                                                                              |  | 12       |  
|Item 6. Exhibits and Reports on Form 8-K                    |                                                                                                              |  | 12       |  
|SIGNATURES                                                  |                                                                                                              |  | 13       |  
|CERTIFICATIONS                                              |                                                                                                              |  | 14-15    |  

-3-



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##### 



MILE MARKER INTERNATIONAL, INC. AND SUBSIDIARYConsolidated Condensed Balance SheetsSeptember 30, 2002 and December 31, 2001
UNAUDITED

|                                                                                                                                                              |                                                                                                  |                            |           |               |           |              |           |           |           | 
|------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------ | -------------------------- | --------- | ------------- | --------- | ------------ | --------- | --------- | --------- | 
|                                                                                                                                                              |                                                                                                  |                            |           | September 30, |           | December 31,
|                                                                                                                                                              |                                                                                                  |                            |           | 2002          |           | 2001        
|                                                                                                                                                              |                                                                                                  |                            |           |               |           |             
|ASSETS                                                                                                                                                        |                                                                                                  |                            |           |               |           |              |           |          
|CURRENT ASSETS                                                                                                                                                |                                                                                                  |                            |           |               |           |              |           |          
|                                                                                                                                                              | Cash                                                                                             |                            | $         | 151,115       |           |              | $         | 50,089    |          
|                                                                                                                                                              | Accounts Receivable, net of allowance for doubtful
accounts of $18,000 and $29,000, respectively |                            |           | 1,297,274     |           |              |           | 3,063,209 |          
|                                                                                                                                                              | Inventories                                                                                      |                            |           | 3,252,840     |           |              |           | 3,254,473 |          
|                                                                                                                                                              | Notes and Other Receivables                                                                      |                            |           | 326,711       |           |              |           | 149,764   |          
|                                                                                                                                                              | Deferred Tax Asset                                                                               |                            |           | 38,079        |           |              |           | 39,800    |          
|                                                                                                                                                              | Prepaid Expenses                                                                                 |                            |           | 51,545        |           |              |           | 60,210    |          
|                                                                                                                                                              |                                                                                                  |                            |           |               |           |              |           |           |          
|                                                                                                                                                              |                                                                                                  | Total Current Assets       |           |               | 5,117,564 |              |           |           | 6,617,545 | 
|PROPERTY AND EQUIPMENT, NET                                                                                                                                   |                                                                                                  |                            | 385,245   |               |           |              | 440,681   |          
|OTHER ASSETS                                                                                                                                                  |                                                                                                  |                            | 102,925   |               |           |              | 101,904   |          
|                                                                                                                                                              |                                                                                                  |                            |           |               |           |              |           |           |          
|Total Assets                                                                                                                                                  |                                                                                                  | $                          | 5,605,734 |               |           | $            | 7,160,130 |          
|                                                                                                                                                              |                                                                                                  |                            |           |               |           |              |           |           |          
|LIABILITIES AND SHAREHOLDERS EQUITY                                                                                                                          |                                                                                                  |                            |           |               |           |              |           |          
|CURRENT LIABILITIES                                                                                                                                           |                                                                                                  |                            |           |               |           |              |           |          
|                                                                                                                                                              | Notes Payable  Line of Credit                                                                   |                            | $         | 1,284,615     |           |              | $         | 2,584,282 |          
|                                                                                                                                                              | Notes Payable  Current Portion                                                                  |                            |           |              |           |              |           | 21,066    |          
|                                                                                                                                                              | Accounts Payable                                                                                 |                            |           | 363,961       |           |              |           | 1,111,343 |          
|                                                                                                                                                              | Income Taxes Payable                                                                             |                            |           | 199,095       |           |              |           | 425,538   |          
|                                                                                                                                                              | Accrued Liabilities                                                                              |                            |           | 54,222        |           |              |           | 73,953    |          
|                                                                                                                                                              |                                                                                                  |                            |           |               |           |              |           |           |          
|                                                                                                                                                              |                                                                                                  | Total Current Liabilities  |           |               | 1,901,893 |              |           |           | 4,216,182 | 
|DEFERRED TAX CREDIT                                                                                                                                           |                                                                                                  |                            | 30,138    |               |           |              | 42,172    |          
|LONG-TERM LIABILITIES                                                                                                                                         |                                                                                                  |                            |           |               |           |              |           |          
|                                                                                                                                                              | Notes Payable                                                                                    |                            |           |              |           |              |           | 87,790    |          
|                                                                                                                                                              |                                                                                                  |                            |           |               |           |              |           |           |          
|                                                                                                                                                              |                                                                                                  | Total Liabilities          |           |               | 1,932,031 |              |           |           | 4,346,144 | 
|                                                                                                                                                              |                                                                                                  |                            |           |               |           |              |           |           |          
|SHAREHOLDERS EQUITY                                                                                                                                          |                                                                                                  |                            |           |               |           |              |           |          
|Common Stock, $.001 par value; 20,000,000 shares
authorized, 10,364,357 shares issued at September 30,
2002 and 10,634,357 shares issued at December 31, 2001 |                                                                                                  |                            | 10,364    |               |           |              | 10,634    |          
|Additional Paid-in Capital                                                                                                                                    |                                                                                                  |                            | 1,315,485 |               |           |              | 1,521,215 |          
|Treasury Shares (68,500 shares at cost)                                                                                                                       |                                                                                                  |                            | (49,191   | )             |           |              |          |          
|Retained Earnings                                                                                                                                             |                                                                                                  |                            | 2,397,045 |               |           |              | 1,282,137 |          
|                                                                                                                                                              |                                                                                                  |                            |           |               |           |              |           |           |          
|                                                                                                                                                              |                                                                                                  | Total Shareholders Equity |           |               | 3,673,703 |              |           |           | 2,813,986 | 
|                                                                                                                                                              |                                                                                                  |                            |           |               |           |              |           |           |          
|Total Liabilities & Shareholders Equity                                                                                                                      |                                                                                                  | $                          | 5,605,734 |               |           | $            | 7,160,130 |          
|                                                                                                                                                              |                                                                                                  |                            |           |               |           |              |           |           |          

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

-4-



---



##### 



MILE MARKER INTERNATIONAL, INC. AND SUBSIDIARYConsolidated Condensed Statements of Income
Three Months Ended September 30, 2002 and 2001
UNAUDITED

|                                         |                                               |                                           |                  |                              |         |         |           |            |         |         |           |  
|---------------------------------------- | --------------------------------------------- | ----------------------------------------- | ---------------- | ---------------------------- | ------- | ------- | --------- | ---------- | ------- | ------- | --------- | -
|                                         |                                               |                                           |                  |                              |         | 2002    |           | 2001      
|                                         |                                               |                                           |                  |                              |         |         |           |           
|Sales                                    |                                               | $                                         | 1,906,837        |                              |         | $       | 3,086,174 |           
|Cost of Sales                            |                                               |                                           | 1,042,993        |                              |         |         | 1,478,928 |           
|                                         |                                               |                                           |                  |                              |         |         |           |           
|                                         |                                               |                                           |                  | Gross Profit                 |         |         | 863,844   |            |         |         | 1,607,246 |  
|                                         |                                               |                                           |                  |                              |         |         |           |           
|Selling Expenses                         |                                               |                                           | 191,836          |                              |         |         | 256,334   |           
|                                         |                                               |                                           |                  |                              |         |         |           |           
|General and Administrative Expenses      |                                               |                                           |                  |                              |         |         |           |           
|                                         | Salaries and Wages                            |                                           |                  | 307,811                      |         |         |           | 348,307    |        
|                                         | Professional Fees                             |                                           |                  | 16,647                       |         |         |           | 58,878     |        
|                                         | Rent                                          |                                           |                  | 34,952                       |         |         |           | 44,059     |        
|                                         | Depreciation and Amortization                 |                                           |                  | 36,436                       |         |         |           | 33,063     |        
|                                         | Insurance                                     |                                           |                  | 19,828                       |         |         |           | 25,932     |        
|                                         | Vehicle Expenses                              |                                           |                  | 13,573                       |         |         |           | 18,274     |        
|                                         | Research & Development                        |                                           |                  | 14,923                       |         |         |           | 7,118      |        
|                                         | Other                                         |                                           |                  | 88,359                       |         |         |           | 60,591     |        
|                                         |                                               |                                           |                  |                              |         |         |           |           
|                                         |                                               | Total General and Administrative Expenses |                  |                              | 532,529 |         |           |            | 596,222 |        
|                                         |                                               |                                           |                  |                              |         |         |           |           
|                                         |                                               |                                           |                  | Total Expenses               |         |         | 724,365   |            |         |         | 852,556   |  
|                                         |                                               |                                           |                  |                              |         |         |           |           
|Income from Operations                   |                                               |                                           | 139,479          |                              |         |         | 754,690   |           
|                                         |                                               |                                           |                  |                              |         |         |           |           
|Other Income/(Expense)                   |                                               |                                           |                  |                              |         |         |           |           
|                                         |                                               |                                           | Interest Expense |                              |         | (13,901 | )         |            |         | (37,129 | )        
|                                         |                                               |                                           | Interest Income  |                              |         | 26,117  |           |            |         |        |          
|                                         |                                               |                                           | Other Income     |                              |         | 5,000   |           |            |         | 17,383  |          
|                                         |                                               |                                           |                  |                              |         |         |           |           
|                                         |                                               |                                           |                  | Total Other Income/(Expense) |         |         | 17,216    |            |         |         | (19,746   | )
|                                         |                                               |                                           |                  |                              |         |         |           |           
|Income before Provision for Income Taxes |                                               |                                           | 156,695          |                              |         |         | 734,944   |           
|Provision for Income Taxes               |                                               |                                           | (73,013          | )                            |         |         | (275,260  | )         
|                                         |                                               |                                           |                  |                              |         |         |           |           
|                                         |                                               | Net Income                                |                  | $                            | 83,682  |         |           | $          | 459,684 |        
|                                         |                                               |                                           |                  |                              |         |         |           |           
|Per Share Data:                          |                                               |                                           |                  |                              |         |         |           |           
|                                         | Weighted Average Shares Outstanding  Basic   |                                           |                  | 10,374,792                   |         |         |           | 10,634,357 |        
|                                         | Weighted Average Shares Outstanding  Diluted |                                           |                  | 10,385,318                   |         |         |           | 10,634,357 |        
|                                         | Earnings per Common Share  Basic             |                                           | $                | 0.01                         |         |         | $         | 0.04       |        
|                                         | Earnings per Common Share  Diluted           |                                           | $                | 0.01                         |         |         | $         | 0.04       |        

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

-5-



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##### 



MILE MARKER INTERNATIONAL, INC. AND SUBSIDIARYConsolidated Condensed Statements of Income
Nine Months Ended September 30, 2002 and 2001
UNAUDITED

|                                         |                                               |                                           |                        |                              |           |         |           |            |           |          |           |  
|---------------------------------------- | --------------------------------------------- | ----------------------------------------- | ---------------------- | ---------------------------- | --------- | ------- | --------- | ---------- | --------- | -------- | --------- | -
|                                         |                                               |                                           |                        |                              |           | 2002    |           | 2001      
|                                         |                                               |                                           |                        |                              |           |         |           |           
|Sales                                    |                                               | $                                         | 8,299,752              |                              |           | $       | 7,710,854 |           
|Cost of Sales                            |                                               |                                           | 4,098,200              |                              |           |         | 4,041,730 |           
|                                         |                                               |                                           |                        |                              |           |         |           |           
|                                         |                                               |                                           |                        | Gross Profit                 |           |         | 4,201,552 |            |           |          | 3,669,124 |  
|                                         |                                               |                                           |                        |                              |           |         |           |           
|Selling
Expenses                         |                                               |                                           | 719,613                |                              |           |         | 685,389   |           
|                                         |                                               |                                           |                        |                              |           |         |           |           
|General and Administrative Expenses      |                                               |                                           |                        |                              |           |         |           |           
|                                         | Salaries and Wages                            |                                           |                        | 968,241                      |           |         |           | 809,652    |          
|                                         | Professional Fees                             |                                           |                        | 120,999                      |           |         |           | 167,091    |          
|                                         | Rent                                          |                                           |                        | 114,433                      |           |         |           | 110,386    |          
|                                         | Depreciation and Amortization                 |                                           |                        | 106,664                      |           |         |           | 90,164     |          
|                                         | Insurance                                     |                                           |                        | 63,037                       |           |         |           | 51,312     |          
|                                         | Vehicle Expenses                              |                                           |                        | 45,435                       |           |         |           | 38,588     |          
|                                         | Research & Development                        |                                           |                        | 30,427                       |           |         |           | 44,163     |          
|                                         | Other                                         |                                           |                        | 247,614                      |           |         |           | 174,023    |          
|                                         |                                               |                                           |                        |                              |           |         |           |           
|                                         |                                               | Total General and Administrative Expenses |                        |                              | 1,696,850 |         |           |            | 1,485,379 |         
|                                         |                                               |                                           |                        |                              |           |         |           |           
|                                         |                                               |                                           |                        | Total Expenses               |           |         | 2,416,463 |            |           |          | 2,170,768 |  
|                                         |                                               |                                           |                        |                              |           |         |           |           
|Income from Operations                   |                                               |                                           | 1,785,089              |                              |           |         | 1,498,356 |           
|                                         |                                               |                                           |                        |                              |           |         |           |           
|Other Income/(Expense)                   |                                               |                                           |                        |                              |           |         |           |           
|                                         |                                               |                                           | Interest Expense       |                              |           | (59,902 | )         |            |           | (118,986 | )        
|                                         |                                               |                                           | Interest Income        |                              |           | 38,464  |           |            |           | 6,883    |          
|                                         |                                               |                                           | Other (Expense)/Income |                              |           | (322    | )         |            |           | 10,500   |          
|                                         |                                               |                                           |                        |                              |           |         |           |           
|                                         |                                               |                                           |                        | Total
Other Income/(Expense) |           |         | (21,760   | )          |           |          | (101,603  | )
|                                         |                                               |                                           |                        |                              |           |         |           |           
|Income before Provision for Income Taxes |                                               |                                           | 1,763,329              |                              |           |         | 1,396,753 |           
|Provision for Income Taxes               |                                               |                                           | (648,421               | )                            |           |         | (548,621  | )         
|                                         |                                               |                                           |                        |                              |           |         |           |           
|                                         |                                               | Net Income                                |                        | $                            | 1,114,908 |         |           | $          | 848,132   |         
|                                         |                                               |                                           |                        |                              |           |         |           |           
|Per Share Data:                          |                                               |                                           |                        |                              |           |         |           |           
|                                         | Weighted Average Shares Outstanding  Basic   |                                           |                        | 10,513,368                   |           |         |           | 10,634,357 |          
|                                         | Weighted Average Shares Outstanding  Diluted |                                           |                        | 10,523,760                   |           |         |           | 10,634,357 |          
|                                         | Earnings per Common Share  Basic             |                                           | $                      | 0.11                         |           |         | $         | 0.08       |          
|                                         | Earnings per Common Share  Diluted           |                                           | $                      | 0.11                         |           |         | $         | 0.08       |          

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

-6-



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##### 



MILE MARKER INTERNATIONAL, INC. AND SUBSIDIARYConsolidated Condensed Statements of Cash FlowsNine Months Ended September 30, 2002 and 2001
UNAUDITED

|                                                                                         |                               |                                              |                             |         |         |           |          |         |         |          |  
|---------------------------------------------------------------------------------------- | ----------------------------- | -------------------------------------------- | --------------------------- | ------- | ------- | --------- | -------- | ------- | ------- | -------- | -
|                                                                                         |                               |                                              |                             |         | 2002    |           | 2001    
|                                                                                         |                               |                                              |                             |         |         |           |         
|OPERATING ACTIVITIES                                                                     |                               |                                              |                             |         |         |           |          |        
|Net income                                                                               |                               | $                                            | 1,114,908                   |         |         | $         | 848,132  |        
|Adjustments to reconcile net income to net cash
provided/(used) by operating activities: |                               |                                              |                             |         |         |           |          |        
|                                                                                         | Depreciation and amortization |                                              |                             | 130,922 |         |           |          | 105,652 |        
|                                                                                         | Deferred income taxes         |                                              |                             | (13,754 | )       |           |          | 21,215  |        
|                                                                                         | Bad debts                     |                                              |                             | 22,235  |         |           |          | 39,442  |        
|Changes in operating assets and liabilities:                                             |                               |                                              |                             |         |         |           |          |        
|(Increase) decrease in:                                                                  |                               |                                              |                             |         |         |           |          |        
|                                                                                         |                               |                                              | Accounts receivable         |         |         | 1,743,701 |          |         |         | (938,600 | )
|                                                                                         |                               |                                              | Inventories                 |         |         | 1,633     |          |         |         | (897,497 | )
|                                                                                         |                               |                                              | Prepaid expenses            |         |         | 8,665     |          |         |         | (791     | )
|                                                                                         |                               |                                              | Notes and other receivables |         |         | (176,947  | )        |         |         | (180,324 | )
|                                                                                         |                               |                                              | Other assets                |         |         | (29,472   | )        |         |         | (8,821   | )
|(Decrease) increase in:                                                                  |                               |                                              |                             |         |         |           |          |        
|                                                                                         |                               |                                              | Accounts payable            |         |         | (747,382  | )        |         |         | 365,440  |  
|                                                                                         |                               |                                              | Income taxes payable        |         |         | (226,443  | )        |         |         | 383,902  |  
|                                                                                         |                               |                                              | Accrued liabilities         |         |         | (19,731   | )        |         |         | 13,282   |  
|                                                                                         |                               |                                              |                             |         |         |           |          |        
|Net cash provided/(used) by operating activities                                         |                               |                                              | 1,808,335                   |         |         |           | (248,968 | )      
|                                                                                         |                               |                                              |                             |         |         |           |          |        
|INVESTING ACTIVITIES:                                                                    |                               |                                              |                             |         |         |           |          |        
|Proceeds from sale of property and equipment                                             |                               |                                              | 29,000                      |         |         |           |         |        
|Property and equipment acquisitions                                                      |                               |                                              | (72,595                     | )       |         |           | (255,553 | )      
|                                                                                         |                               |                                              |                             |         |         |           |          |        
|Net cash (used) by investing activities                                                  |                               |                                              | (43,595                     | )       |         |           | (255,553 | )      
|                                                                                         |                               |                                              |                             |         |         |           |          |        
|FINANCING ACTIVITIES                                                                     |                               |                                              |                             |         |         |           |          |        
|(Repayments)/proceeds of short term borrowing  net                                      |                               |                                              | (1,299,667                  | )       |         |           | 470,055  |        
|Purchase of treasury common stock                                                        |                               |                                              | (255,191                    | )       |         |           |         |        
|Proceeds from long term borrowing                                                        |                               |                                              |                            |         |         |           | 119,538  |        
|Principal payments on long-term debt                                                     |                               |                                              | (108,856                    | )       |         |           |         |        
|                                                                                         |                               |                                              |                             |         |         |           |          |        
|Net cash (used)/provided by financing activities                                         |                               |                                              | (1,663,714                  | )       |         |           | 589,593  |        
|                                                                                         |                               |                                              |                             |         |         |           |          |        
|Increase in Cash                                                                         |                               |                                              | 101,026                     |         |         |           | 85,072   |        
|Cash at Beginning of Period                                                              |                               |                                              | 50,089                      |         |         |           | 27,191   |        
|                                                                                         |                               |                                              |                             |         |         |           |          |        
|Cash at End of Period                                                                    |                               | $                                            | 151,115                     |         |         | $         | 112,263  |        
|                                                                                         |                               |                                              |                             |         |         |           |          |        
|Supplemental disclosure of cash flow information:                                        |                               |                                              |                             |         |         |           |          |        
|                                                                                         |                               | Cash paid during the period for interest     |                             | $       | 55,653  |           |          | $       | 118,988 |         
|                                                                                         |                               | Cash paid during the period for income taxes |                             | $       | 885,178 |           |          | $       | 143,505 |         

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

-7-



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##### 



MILE MARKER INTERNATIONAL, INC.NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Unaudited)

Note 1: Basis of Presentation

The unaudited consolidated condensed financial statements include the
accounts of Mile Marker International, Inc. and its wholly-owned subsidiary,
Mile Marker, Inc. (collectively the Company). All necessary adjustments to
the financial statements have been made, and significant inter-company accounts
and transactions have been eliminated in consolidation.

The accompanying unaudited consolidated condensed financial statements,
which are for interim periods, do not include all disclosures provided in the
annual consolidated financial statements. These unaudited consolidated
condensed financial statements should be read in conjunction with the
consolidated financial statements and the footnotes thereto contained in the
Annual Report on Form 10-KSB for the year ended December 31, 2001 of Mile
Marker International, Inc., as filed with the Securities and Exchange
Commission. The summary December 31, 2001, balance sheet was derived from
audited consolidated financial statements, but does not include all disclosures
required by generally accepted accounting principles at December 31, 2001.

In the opinion of the Company, the accompanying unaudited consolidated
condensed financial statements contain all adjustments (which are of a normal
recurring nature) necessary for a fair presentation of the financial
statements. The results for interim periods are not necessarily indicative of
results to be expected for the complete fiscal year.

Per share data was computed by dividing net income by the weighted average
number of shares outstanding during the period. The diluted share base for
the period ended September 30, 2002 includes incremental shares for stock
options outstanding during this period, but excludes incremental shares for
stock options outstanding during the period ended September 30, 2001, since
their effect was anti-dilutive during that period.

Note 2: Shareholders Equity

During the nine months ended September 30, 2002, the Company purchased
338,500 shares of its common stock, $.001 par value, for $255,190.50. As of
September 30, 2002, 68,500 shares were being held in the Companys treasury,
and 270,000 of the Companys common shares had been retired.

Note 3: Reclassification

Certain amounts in prior periods have been reclassified for comparative
purposes.

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##### 



Item 2. Managements Discussion or Plan of Operation

The following discussion and analysis should be read in conjunction with
the Financial Statements appearing elsewhere in this quarterly report on Form
10-QSB.

RESULTS OF OPERATIONS

The following table summarizes the results of operations, stated as a
percentage of sales, for the nine months and three months ended September 30,
2002, and 2001:

|                                             |                |  |             |      |              |  |       |      |      |  |       |      |   |  |       |      |  
|-------------------------------------------- | -------------- |  | ----------- | ---- | ------------ |  | ----- | ---- | ---- |  | ----- | ---- | - |  | ----- | ---- | -
|                                             |                |  | Nine Months |      | Three Months
|                                             |                |  |             |      |             
|                                             |                |  | 2002        |      | 2001         |  | 2002  |      | 2001
|                                             |                |  |             |      |              |  |       |      |     
|Sales                                        |                |  | 100.0       | %    |              |  | 100.0 | %    |      |  | 100.0 | %    |   |  | 100.0 | %   
|Cost of Sales                                |                |  | 49.4        | %    |              |  | 52.4  | %    |      |  | 54.7  | %    |   |  | 47.9  | %   
|                                             |                |  |             |      |              |  |       |      |      |  |       |      |   |  |       |     
|                                             | Gross Profit   |  |             | 50.6 | %            |  |       | 47.6 | %    |  |       | 45.3 | % |  |       | 52.1 | %
|Selling, General and
Administrative Expenses |                |  | 29.1        | %    |              |  | 28.2  | %    |      |  | 38.0  | %    |   |  | 27.7  | %   
|                                             |                |  |             |      |              |  |       |      |      |  |       |      |   |  |       |     
|Income from Operations                       |                |  | 21.5        | %    |              |  | 19.4  | %    |      |  | 7.3   | %    |   |  | 24.4  | %   
|Other Income/(Expense)                       |                |  | (0.3        | )%   |              |  | (1.3  | )%   |      |  | .9    | %    |   |  | (.6   | )%  
|                                             |                |  |             |      |              |  |       |      |      |  |       |      |   |  |       |     
|                                             | Pre-Tax Income |  |             | 21.2 | %            |  |       | 18.1 | %    |  |       | 8.2  | % |  |       | 23.8 | %
|Income Taxes                                 |                |  | (7.8        | )%   |              |  | (7.1  | )%   |      |  | (3.8  | )%   |   |  | (8.9  | )%  
|                                             |                |  |             |      |              |  |       |      |      |  |       |      |   |  |       |     
|                                             | Net Income     |  |             | 13.4 | %            |  |       | 11.0 | %    |  |       | 4.4  | % |  |       | 14.9 | %

Sales of $8,299,752 for the nine months ended September 30, 2002, were
$588,898, or approximately 8%, more than sales of $7,710,854 during the same
period in 2001. This sales increase was due chiefly to greater military and
civilian winch sales in the first nine months of 2002 than in the comparable
period in 2001. An increase of approximately $1,100,000 in winch sales during
this period was offset by approximately $500,000 in lower sales of all other
products. Total sales of $1,906,837 in the three months ended September 30,
2002, were $1,179,337, or approximately 38%, less than sales of $3,086,174
during the same period in 2001. The major reason for this decrease was a
decrease of approximately $1,300,000 in military winch sales during the
September 2002 quarter compared to the comparable period in 2001 due to the
completion of the $7,137,938 military winch order that the Company announced in
2001. The Companys sales volume during the nine months ended September 30,
2002, was heavily affected by the military winch order, and such sales volume
will not be sustainable in the near future without another similar large
military order.

The Companys gross profit margin increased from 47.6% of sales in the
nine months ended September 30, 2001 to 50.6% of sales in the comparable 2002
period primarily due to a decreased volume of lower margin special order
products and an increased volume of military winch orders. The gross margin in
the three months ended September 30, 2002 decreased to 45.3% from 52.1% in the
comparable period in 2001 due to reduced military winches in the product mix
for the third quarter of 2002.

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##### 



Selling costs increased by $34,224, or about 5%, in the first nine months
of 2002 to $719,613 from $685,389 in the comparable period in 2001. Virtually
all of this increase in selling costs was due to increased sales commissions
paid on higher sales volume. For the three months ending September 30, 2002,
selling costs were approximately $64,000 less than during the comparable period
in 2001 due to the lower sales volume.

Total general and administrative expenses for the nine months ended
September 30, 2002, increased by approximately $211,000, or about 14%, to
$1,696,850 from $1,485,379 in the comparable period in 2001. Virtually all of
this increase is attributable to increased staffing costs required to fulfill
the Companys substantial military orders and to aggressively market winches to
the non-military markets. Relative to sales volume, the Companys total general
and administrative costs increased from 19.3% of sales in the first nine months
of 2001 to 20.4% of sales during the same period in 2002. For the three
months ended September 30, 2002, general and administrative expenses decreased
by $63,693, or approximately 11%, over the comparable period in 2001. The
decreases in this period were principally in staffing, professional fees, rent,
and insurance expenses.

The Companys results from operations for the first nine months of 2002
reflected income from operations of $1,785,089 compared to income from
operations of $1,498,356 during the same period in 2001. This increase of
approximately 19% in the first nine months of 2002 compared to the same period
in 2001 is due to the 8% increase in sales, an improved profit margin and
controlled expense increases. Income from operations in the three months ended
September 30, 2002, were $139,479, compared to $754,690 in income from
operations during the same period in 2001. This decrease of approximately 82%
is due primarily to the fact that sales in the third quarter of 2002 were 38%
less than sales in the same period in 2001 and at lower margins. Interest
expenses in the first nine months of 2002 were $59,902, compared to $118,986 in
the first nine months of 2001, reflecting lower borrowing costs and a lower
volume of borrowings. Also, during the three months and nine months ended
September 30, 2002, the Company received $26,117 and $38,464, respectively, of
interest income on its notes receivable, compared to $ 0 and $6,883 of interest
income during the same periods in 2001.

During the nine months ended September 30, 2002, the Company recorded
income before taxes of $1,763,329 compared to income before taxes of $1,396,753
during the same period in 2001. Net income for the first nine months of 2002
totaled $1,114,908 compared to net income of $848,132 for the first nine months
of 2001, an increase of approximately 31%. This net income represents earnings
per common share of $0.11 for the first nine months of 2002 compared to
earnings per common share of $0.08 for the first nine months of 2001. During
the three months ended September 30, 2002, the Company recorded net income of
$83,682 compared to net income of $459,684 during the same three-month period
in 2001, a decrease of approximately 82%. This net income represents earnings
per common share of $0.01 for the third quarter of 2002 compared to earnings
per common share of $0.04 for the same period in 2001.

-10-



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##### 



LIQUIDITY AND CAPITAL RESOURCES

Net working capital increased by $814,308 to $3,215,671 on September 30,
2002, from $2,401,363 on December 31, 2001, and the Companys current ratio
increased to 2.69 at September 30, 2002, compared to 1.57 at December 31, 2001.
The Companys current assets decreased by $1,499,981 to $5,117,564 at
September 30, 2002, compared to $6,617,545 at December 31, 2001. Most of this
decrease was due to collected accounts receivable, which decreased from
$3,063,209 on December 31, 2001, to $1,297,274 on September 30, 2002.
Offsetting this decrease in accounts receivable was an increase of $176,947 in
notes receivable in the first nine months of 2002.

The Companys current liabilities decreased by $2,314,289 to $1,901,893 at
September 30, 2002, compared to $4,216,182 at December 31, 2001, and all
$87,790 of the Companys long term debt was repaid. The Companys short-term
borrowings under its line of credit decreased by $1,299,667 from December 31,
2001 levels, and its trade accounts payable decreased by $747,382 during the
nine months ended September 30, 2002. Income taxes payable also decreased by
$226,443 in the same period. The major source of cash to reduce these
liabilities in 2002 was the cash provided by operating activities, which was
$1,808,335, compared to $248,968 of cash used by operating activities in the
first nine months of 2001.

The Company anticipates having more than adequate capital and liquidity
for its foreseeable operational needs. The Company has no material commitments
outstanding for major capital expenditures during 2002. During the first nine
months of 2002, the Company invested approximately $73,000 in capital
expenditures, primarily tooling and fixtures. During the first nine months of
2002, the Company also utilized $255,191 of its cash to repurchase 338,500
shares of its common stock.

The Companys cash balances increased by $101,026 from the December 31,
2001, level of $50,089 to $151,115 on September 30, 2002, due to the timing of
deposits in transit. However, these cash balances are not indicative of the
Companys true liquidity because the Company employs an efficient cash
management system utilizing a zero balance disbursement account funded by the
Companys credit facility at the time outstanding checks are presented and
paid. The Company funds its operations chiefly through the collection of its
trade receivables, supplemented with periodic short-term borrowings from a
lender.

On February 28, 2002, the Companys lender increased the maximum amount of
the Companys working capital line of credit to $3,500,000, extended its
maturity date to February 28, 2003, and changed the interest rate on all
borrowings to 2.55% above the One Month London Interbank Offered Rate. This
credit facility is secured by substantially all of the Companys assets and
contains certain affirmative, negative and

-11-



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##### 



financial covenants which, among others, specify tangible net worth and fixed
charge coverage requirements. The Companys actual borrowings at September 30,
2002, however, were only about 37% of its total availability due to the
significant cash flow generated from its operations, which facilitated the
substantial reduction of its liabilities.

Item 3. Controls and Procedures

Based on an evaluation conducted within 90 days of the filing date of this
report, the Chief Financial Officer and the Chief Executive Officer of the
Registrant have determined the effectiveness of the Registrants disclosure
controls and procedures. These officers determined that there were no
significant changes in the Registrants internal controls or in other factors
that could significantly affect these controls subsequent to the date of their
evaluation, including any corrective actions with regard to significant
deficiencies and material weaknesses.

PART II  OTHER INFORMATION

Item 1. Legal Proceedings

From time to time, the Company is a party to business disputes arising in
the normal course of its business operations. The Companys management
believes that none of these actions, standing alone, or in the aggregate,
currently are material to the Companys operations or finances.

Item 2 Changes in Securities

None.

Item 3 Defaults Upon Senior Securities

None

Item 4 Submission of Matters to a Vote of Security Holders

None

Item 5 Other Information

None

Item 6 Exhibits and Reports on Form 8K

None

-12-



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##### 



SIGNATURES

In accordance with 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,
duly authorized.

|                                             |  |                                                                 
|-------------------------------------------- |  | ----------------------------------------------------------------
|MILE MARKER INTERNATIONAL, INC.
(Registrant) |  |                                                                 
|                                             |  |                                                                 
|11/1/02                                      |  | /s/ Richard E. Aho                                              
|                                             |  |                                                                 
|(Date)                                       |  | Richard E. Aho, President and
Chief Executive Officer           
|                                             |  |                                                                 
|11/1/02                                      |  | /s/ Alvin A. Hirsch                                             
|                                             |  |                                                                 
|(Date)                                       |  | Alvin A. Hirsch, Secretary/Treasurer
and Chief Financial Officer

-13-



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##### 



CERTIFICATION

Pursuant to Section 302 of the Securities Exchange Act of 1934

I, Richard E. Aho, certify that:

1.     I have reviewed
this quarterly report on Form 10-QSB of Mile Marker
International, Inc. (the Registrant).

2.     Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;

3.     Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
issuer as of, and for, the periods presented in this quarterly report;

4.     The Registrants other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the Registrant and we have:

(a)  designed such disclosure controls and procedures to ensure that material
information relating to the Registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this quarterly report is being prepared;

(b)  evaluated the effectiveness of the Registrants disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the Evaluation Date); and

(c)  presented in this quarterly report our conclusions about the effectiveness
of the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;

5.     The Registrants other certifying officers and I have disclosed, based on
our most recent evaluation, to the Registrants auditors and the audit
committee of Registrants board of directors (or persons fulfilling the
equivalent function):

(a)  all significant deficiencies in the design or operation of internal
controls which could adversely affect the Registrants ability to record,
process, summarize and report financial data and have identified for the
Registrants auditors any material weaknesses in internal controls; and

(b)  any fraud, whether or not material, that involves management or other
employees who have a significant role in the issuers internal controls; and

6.     The Registrants other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.

|              |  |                                       
|------------- |  | --------------------------------------
|Date: 11/1/02 |  |                                       
|              |  | /s/ Richard E. Aho                    
|              |  |                                       
|              |  | Richard E. Aho
Chief Executive Officer

-14-



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##### 



CERTIFICATION

Pursuant to Section 302 of the Securities Exchange Act of 1934

I, Alvin A. Hirsch, certify that:

1.     I have reviewed
this quarterly report on Form 10-QSB of Mile Marker
International, Inc. (the Registrant).

2.     Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;

3.     Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
issuer as of, and for, the periods presented in this quarterly report;

4.     The Registrants other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the Registrant and we have:

(a)  designed such disclosure controls and procedures to ensure that material
information relating to the Registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this quarterly report is being prepared;

(b)  evaluated the effectiveness of the Registrants disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the Evaluation Date); and

(c)  presented in this quarterly report our conclusions about the effectiveness
of the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;

5.     The Registrants other certifying officers and I have disclosed, based on
our most recent evaluation, to the Registrants auditors and the audit
committee of Registrants board of directors (or persons fulfilling the
equivalent function):

(a)  all significant deficiencies in the design or operation of internal
controls which could adversely affect the Registrants ability to record,
process, summarize and report financial data and have identified for the
Registrants auditors any material weaknesses in internal controls; and

(b)  any fraud, whether or not material, that involves management or other
employees who have a significant role in the issuers internal controls; and

6.     The Registrants other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.

|              |  |                                        
|------------- |  | ---------------------------------------
|Date: 11/1/02 |  |                                        
|              |  |                                        
|              |  | /s/ Alvin A. Hirsch                    
|              |  |                                        
|              |  | Alvin A. Hirsch
Chief Financial Officer

-15-