FORM 10-QSB

                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

(Mark One)

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

         For the quarterly period ended:       May 31, 1998


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

                          Commission File No.: 0-10093


                          AMERICAN METALS SERVICE, INC.
       (Exact name of small business issuer as specified in its charter)


         Florida                                                 59-1224913
(State or other jurisdiction of                               (I.R.S. Employer
incorporation or organization)                               Identification No.)


           376 Main Street, P.O. Box 74, Bedminster, New Jersey 07921
              (Address of principal executive offices) (Zip Code)


                                 (908) 234-0078
                           (Issuer's telephone number)

                                 Not Applicable
              (Former name, former address and former fiscal year,
                          if changed since last report)

     Check  whether  the issuer (1) filed all  reports  required  to be filed by
Section 13 or 15(d) of the  Exchange  Act during the past 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 _____

     State the number of shares  outstanding of each of the issuer's  classes of
common equity as of the latest practicable date: As of June 30, 1998, the issuer
had 1,970,107 shares of its common stock, par value $.01 per share, outstanding.

     Transitional Small Business Disclosure Format (check one):
                            Yes____    No X



<PAGE>



PART I -  FINANCIAL INFORMATION

Item 1. - Financial Statements



<TABLE>
<CAPTION>

                          AMERICAN METALS SERVICE, INC.
                                  BALANCE SHEET
                                   (Unaudited)


                                                                 May 31,
                                                                  1998
                                                             --------------
                                                             ($000 Omitted)
                                                            
ASSETS
------
     <S>                                                         <C>
     Current assets:
        Cash and cash equivalents, including
          U.S. treasury bills of $2,033,000                      $2,147
                                                                 ------
            Total current assets                                 $2,147
                                                                 ======



LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------

     Current liabilities:
        Accounts payable and accrued liabilities                 $    4
                                                                 ------
            Total current liabilities                                 4
                                                                 ------

     Stockholders' equity:
        Common stock, $.01 par value, 6,000,000
          shares authorized, 1,970,107 outstanding                   20
        Additional capital in excess of par value                 3,070
        Accumulated deficit                                     (   947)
                                                                 ------

            Total stockholders' equity                            2,143
                                                                 ------
            Total liabilities and stockholders'
              equity                                             $2,147
                                                                 ======



                 See accompanying notes to financial statements.


</TABLE>
 


<PAGE>


<TABLE>
<CAPTION>


                          AMERICAN METALS SERVICE, INC.
                            STATEMENTS OF OPERATIONS
                                   (Unaudited)



                                                     For the three months ended
                                                               May 31,
                                                     ---------------------------
                                                       1998               1997
                                                     --------           --------
                                                           ($000 Omitted,
                                                       Except Per Share Data)

<S>                                                   <C>               <C>
Interest income                                       $    26           $    26

General and administrative expenses                        23                16
                                                      -------           -------

Income before income taxes                                  3                10

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

Net income                                            $     3           $    10
                                                      =======           =======

Basic and diluted net income per share                $     -           $   .01
                                                      =======           =======

Weighted average number of shares
    outstanding (in 000's)                              1,970             1,958
                                                      =======           =======



                 See accompanying notes to financial statements.

</TABLE>


                                                       
<PAGE>


<TABLE>
<CAPTION>

                          AMERICAN METALS SERVICE, INC.
                            STATEMENTS OF OPERATIONS
                                   (Unaudited)



                                                     For the nine months ended
                                                              May 31,
                                                     --------------------------
                                                       1998              1997
                                                     --------           ------- 
                                                          ($000 Omitted,
                                                       Except Per Share Data)

<S>                                                   <C>              <C>
Revenues:

    Interest                                          $    79          $    76
    Other income                                            -                1
                                                      -------          -------
                                                           79               77


General and administrative expenses                        55               44
                                                      -------          -------

Income before income taxes                                 24               33

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

Net income                                            $    24          $    33
                                                      =======          =======

Basic and diluted net income per share                $   .01          $   .02
                                                      =======          =======

Weighted average number of shares
    outstanding (in 000's)                              1,961            1,958
                                                      =======          =======



                 See accompanying notes to financial statements.

</TABLE>
                                                       





<PAGE>


<TABLE>
<CAPTION>

                          AMERICAN METALS SERVICE, INC.
                            STATEMENTS OF CASH FLOWS
                                   (Unaudited)



                                                     For the nine months ended
                                                              May 31,
                                                     --------------------------
                                                       1998              1997
                                                     --------          --------
                                                           ($000 Omitted)

<S>                                                  <C>               <C>
Cash flows from operating activities:
        Net cash provided by
           operating activities                       $   20            $   19

Cash flows from financing activities:
        Purchase of common stock                           -           (     7)
        Issuance of common stock upon
           exercise of stock options                      16                 -
                                                      ------            ------
        Net cash provided by (used in)
           financing activities                           16           (     7)
                                                      ------            ------

Net increase in cash and cash
    equivalents                                           36                12
Cash and cash equivalents at beginning
    of the period                                      2,111             2,090
                                                      ------            ------
Cash and cash equivalents at end of
    the period                                        $2,147            $2,102
                                                      ======            ======

Reconciliation of net income 
    to net cash provided by 
    operating activities:
  Net income                                         $   24             $   33
    Adjustments to reconcile net income
      to net cash provided by
      operating activities:
     Change in accounts payable
       and accrued liabilities                      (     4)           (    14)
                                                     ------             ------
  Net cash provided by operating
    activities                                       $   20             $   19
                                                     ======             ======




                 See accompanying notes to financial statements.


</TABLE>


                                                         

<PAGE>



                          AMERICAN METALS SERVICE, INC.

                          NOTE TO FINANCIAL STATEMENTS

                                   (Unaudited)




1.   Basis of Presentation
     ---------------------

     The accompanying unaudited financial statements of American Metals Service,
Inc. (the "Company") as of May 31, 1998 and for the three and nine month periods
ended May 31,  1998 and 1997  reflect all  material  adjustments  which,  in the
opinion of management,  are necessary for a fair presentation of results for the
interim periods.  Certain  information and footnote  disclosures  required under
generally accepted accounting principles have been condensed or omitted pursuant
to the rules and regulations of the Securities and Exchange Commission, although
the Company  believes that the  disclosures are adequate to make the information
presented  not  misleading.   These  financial  statements  should  be  read  in
conjunction with the year-end financial statements and notes thereto included in
the  Company's  Annual Report on Form 10-KSB for the year ended August 31, 1997,
as filed with the Securities and Exchange Commission.

     The results of  operations  for the three and nine month  periods ended May
31, 1998 are not  necessarily  indicative  of the results to be expected for the
entire fiscal year or for any other period.


2.   Income Per Share
     ----------------

     Income (loss) per common share is calculated in accordance  with  Statement
of Financial  Accounting  Standards No.128 "Earnings Per Share" ("SFAS No. 128")
and is based on the  weighted  average  number  of shares  outstanding.  Diluted
earnings  per share  includes the assumed  conversion  of shares  issuable  upon
exercise  of  options  where  appropriate.   Prior  years'  earnings  per  share
information has been restated to comply with the requirements of SFAS No. 128.



<PAGE>




Item 2. -  Management's Discussion and Analysis or Plan of
           -----------------------------------------------
           Operations
           ----------


Results of Operations
---------------------

     Until the fourth  quarter of fiscal  1992,  the  Company was engaged in the
wholesale distribution of aluminum alloys, steel and other specialty metals. The
Company has liquidated the assets of its former business and is actively seeking
an acquisition with the goal of becoming an operating  company.  In the interim,
available cash is being invested in U.S.  Treasury  securities.  Interest income
for both of the quarters ended May 31, 1998 and 1997, was approximately $26,000.
For the nine month  period  ended May 31,  1998,  interest  income  was  $79,000
compared to $76,000 for the  comparable  period of the prior  fiscal  year.  The
increase in interest income during the current fiscal year compared to the prior
fiscal year was due to higher available  interest rates and invested balances on
the Company's cash equivalents.  Collections of previously  written-off accounts
receivable  of $1,000  accounted  for the other  income in the nine month period
ended May 31, 1997.

     General  and  administrative  expenses  were  $23,000  and  $16,000 for the
quarters ended May 31, 1998 and 1997, respectively,  and $55,000 and $44,000 for
the nine month periods ended May 31, 1998 and 1997,  respectively.  The increase
in general  and  administrative  expenses  was due to  expenses  incurred in the
search for an operating business in the current fiscal year. A management fee of
$12,500 per quarter is paid to an affiliated  company for accounting,  financial
and administrative  management.  This fee is based on the affiliate's  estimated
costs,  and management  believes that the allocation  method is reasonable.  The
remaining general and  administrative  expenses for the nine month periods ended
May 31, 1998 and 1997 consist of stockholder,  insurance and other miscellaneous
expenses.


Liquidity and Capital Resources
-------------------------------

     At May 31, 1998,  cash and cash  equivalents  and net working  capital were
approximately $2,147,000 and $2,143,000,  respectively. U.S. Treasury securities
of approximately  $2,033,000 mature at various dates through August 13, 1998 and
bear  interest  rates  ranging  from  5.10% to 5.14%.  Management  believes  the
Company's cash and cash equivalents and net working capital are adequate for its
remaining business  activities and for the costs of seeking an acquisition of an
operating  business.  The net  book  value  of the  Company  at May 31,  1998 is
approximately $1.09 per share.





<PAGE>



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

Item 6. - Exhibits and Reports on Form 8-K
          --------------------------------
      (a)    Exhibits
             --------

              (27). Financial Data Schedule for the nine months ended
                    May 31, 1998.

       (b)   Reports on Form 8-K
             -------------------

             No reports on Form 8-K were filed during the quarter for which
             this Form 10-QSB is filed.

<PAGE>


                                    SIGNATURE


     In accordance  with the  requirements  of the Exchange Act, the  registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.


                                                  AMERICAN METALS SERVICE, INC.




Dated: July 10, 1998                              By:/s/ Mark Koscinski
                                                  -----------------------------
                                                  Mark Koscinski
                                                  Vice President and Secretary
                                                  (Principal Accounting Officer)