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

                                   FORM 10-QSB

(Mark One)
[X]    QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
       OF 1934
             For the fiscal quarter ended           March 31, 2004
                                                    --------------

[   ]  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
             For the transition period from           to

             Commission file number                0-17580
                                                   -------

                              SYNERGX SYSTEMS INC.
        (Exact name of small business issuer as specified in its charter)

        Delaware                                      11-2941299
----------------------------                -----------------------------------
(State or jurisdiction of incorporation or  (IRS employer identification Number)
organization)


                  209 Lafayette Drive, Syosset, New York 11791
               (Address of Principal Executive Offices) (Zip code)


                                 (516) 433-4700
                           (Issuer's telephone number)

Check  whether  the issuer  (1) has filed all  reports  required  to be filed by
Section 13 or 15(d) of the Exchange  Act during the  preceding 12 months (or for
such shorter period that 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 May 12, 2004,  4,756,862 shares
of Registrant's Common Stock were issued and outstanding.

Transitional Small Business Disclosure Format (check one)  Yes[    ]     No[ X ]

<PAGE>
                                      INDEX


Part I - Financial Information (unaudited)                                 Page

    Item 1.  Financial Statements.

    Condensed Consolidated Balance Sheet at March 31, 2004                    3

    Condensed Consolidated Statements of Operations for the Three and
         Six Month Periods Ended March 31, 2004 and 2003                      5

    Condensed Consolidated Statements of Cash Flows for the Three and
         Six Month Periods Ended March 31, 2004 and 2003                      6

    Notes to Condensed Consolidated Financial Statements                      7

    Item 2.  Management's Discussion and Analysis of Financial
                  Condition and Results of Operations                        12

    Item 3.   Controls and Procedures                                        16

Part II - Other Information

    Item 1.  Legal Proceedings.                                              17

    Item 2.  Changes in Securities.                                          17

    Item 3.  Defaults Upon Senior Securities.                                17

    Item 4.  Submission of Matters to a Vote of Security Holders.            17

    Item 5.  Other Information.                                              17

    Item 6.  Exhibits and Reports on Form 8-K                                17

    Signatures                                                               18


<PAGE>
                         Part I - FINANCIAL INFORMATION

                      SYNERGX SYSTEMS INC. AND SUBSIDIARIES

                      CONDENSED CONSOLIDATED BALANCE SHEET
                                   (Unaudited)

                                                                   March 31,
                                                                     2004
                                                                 -------------
ASSETS

CURRENT ASSETS
  Cash and cash equivalents                                      $   351,748
  Accounts receivable, principally trade, less allowance
     for doubtful accounts of $411,541                             5,821,865
  Inventories                                                      3,121,063
  Deferred taxes                                                     315,000
  Prepaid expenses and other current assets                          598,132
                                                                  -----------
                 TOTAL CURRENT ASSETS                             10,207,808
                                                                  -----------


PROPERTY AND EQUIPMENT -at cost, less
   accumulated depreciation and amortization of $1,443,382           363,354

OTHER ASSETS                                                         689,192

                                                                  -----------
                 TOTAL ASSETS                                    $11,260,354
                                                                  ===========

See accompanying Notes to the Condensed Consolidated Financial Statements

<PAGE>



                      SYNERGX SYSTEMS INC. AND SUBSIDIARIES

                      CONDENSED CONSOLIDATED BALANCE SHEET
                                  (Unauditied)


                                                                    March 31,
                                                                      2004
                                                                  -----------
LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES

   Notes and capital leases payable - current portion            $    34,323
   Accounts payable and accrued expenses                           3,087,855
   Deferred revenue                                                  409,253
                                                                  -----------
                 TOTAL CURRENT LIABILITIES                         3,531,431



   Note payable to bank                                            1,845,676
   Notes and capital leases payable - less current portion            33,377
   Deferred taxes                                                     20,300
                                                                  -----------
                 TOTAL LIABILITIES                                 5,430,784
                                                                  -----------
COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY

  Preferred stock, 2,000,000 shares authorized-
     none issued and outstanding
  Common stock, 10,000,000 shares authorized, $.001
     par value; issued and outstanding 4,747,528 shares                4,747
  Capital in excess of par                                         6,400,825
  Accumulated deficit                                               (576,002)
                                                                  -----------
TOTAL STOCKHOLDERS' EQUITY                                         5,829,570
                                                                  -----------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                       $11,260,354
                                                                  ===========

See accompanying Notes to the Condensed Consolidated Financial Statements

<PAGE>



                      SYNERGX SYSTEMS INC. AND SUBSIDIARIES

                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)


<TABLE>
<CAPTION>
                                                            For the  Three Months Ended March 31,
                                                                  2004                 2003
                                                                ---------           -----------
<S>                                                            <C>                  <C>
Product sales                                                  $4,160,318           $3,513,724
Subcontract sales                                                  64,600              172,284
Service revenue                                                 1,165,253            1,102,756
                                                                ----------           ----------
Total revenues                                                  5,390,171            4,788,764
                                                                ----------           ----------


Cost of product sales                                           2,815,526            2,271,933
Cost of subcontract sales                                          54,153              145,194
Cost of service                                                   837,695              782,136
Selling, general and administrative                             1,507,778            1,406,716
Interest expense                                                   21,125               17,274
Depreciation and amortization                                      40,004               42,896
Loss on equity  investment                                         12,000                    -
                                                                ----------           ----------
                                                                5,288,281            4,666,149
                                                                ----------           ----------
Income before provision for
  income taxes                                                    101,890              122,615
                                                                ----------           ----------
Provision for income taxes:
   Current                                                         34,400               64,000
   Deferred                                                         8,600               (3,000)
                                                                ----------           ----------
                                                                   43,000               61,000

                                                                ----------           ----------
Net Income                                                     $   58,890           $   61,615
                                                                ==========           ==========
Earnings per common share
  Basic earnings per share                                          $0.01                $0.02
                                                                    =====                =====
  Diluted earnings per share                                        $0.01                $0.01
                                                                    =====                =====

Weighted average number of common shares outstanding            4,718,991            3,748,850

Weighted average number of common and dilutive
  common shares outstanding                                     5,178,703            4,250,784
</TABLE>

See accompanying Notes to the Condensed Consolidated Financial Statements
<PAGE>


                      SYNERGX SYSTEMS INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                       For the Six Months Ended March 31,
                                                           2004                 2003
                                                        ---------            -----------
<S>                                                    <C>                  <C>
Product sales                                          $7,179,266           $6,805,029
Subcontract sales                                         143,535              443,183
Service revenue                                         2,269,176            2,178,071
                                                        ----------           ----------
Total revenues                                          9,591,977            9,426,283
                                                        ----------           ----------


Cost of product sales                                   4,918,277            4,535,416
Cost of subcontract sales                                 119,668              355,708
Cost of service                                         1,634,977            1,509,897
Selling, general and administrative                     2,870,519            2,735,859
Interest expense                                           40,495               27,392
Depreciation and amortization                              88,447               87,574
Loss on equity  investment                                 32,000
                                                        ----------           ----------
                                                        9,704,383            9,251,846
                                                        ----------           ----------
(Loss) Income before provision for
  (benefit from) income taxes                            (112,406)             174,437
                                                        ----------           ----------
(Benefit from) Provision for income taxes:
   Current                                                (27,800)              88,000
   Deferred                                               (17,200)               3,000
                                                        ----------           ----------
                                                          (45,000)              91,000

                                                        ----------           ----------
Net (Loss) Income                                      $  (67,406)          $   83,437
                                                        ==========           ==========
Earnings Per Common Share
  Basic (Loss) Earnings Per Share                          ($0.02)               $0.02
                                                            =====                =====
  Diluted (Loss) Earnings Per Share                        ($0.01)               $0.02
                                                            =====                =====

Weighted average number of common shares outstanding    4,441,037            3,748,850

Weighted average number of common and dilutive
   common share equivalents outstanding                 5,129,795            4,115,266
</TABLE>

See accompanying Notes to the Condensed Consolidated Financial Statements

<PAGE>


                           SYNERGX SYSTEMS INC. AND SUBSIDIARIES

                      CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                        (Unaudited)

<TABLE>
<CAPTION>

                                                                       For the Six Months Ended March 31,
                                                                            2004                2003
                                                                         ---------            ---------
<S>                                                                     <C>                  <C>
OPERATING ACTIVITIES
Net (loss) income                                                       $ (67,406)           $  83,437
 Adjustments to reconcile net (loss) income to net cash
     (used in) provided by operating activities:
         Depreciation and amortization                                     88,447               87,574
         Deferred (benefit) tax                                           (17,200)               3,000
         Provision for doubtful accounts                                        -              (17,483)
         Loss on equity investment                                         32,000
  Changes in operating assets and liabilities:
    Accounts receivable                                                   (27,944)             684,366
    Inventories                                                          (672,493)            (449,349)
    Prepaid expenses and other current assets                            (209,936)            (246,335)
    Other assets                                                          (25,204)             (24,600)
    Accounts payable and accrued expenses                                 161,591               65,048
    Deferred revenue                                                      (25,638)             (27,885)
                                                                         ---------            ---------
NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES                      (763,783)             157,773
                                                                         ---------            ---------
INVESTING ACTIVITIES
  Purchases of property and equipment                                     (30,004)            (102,013)
                                                                         ---------            ---------
NET CASH USED IN INVESTING ACTIVITIES                                     (30,004)            (102,013)
                                                                         ---------            ---------
FINANCING ACTIVITIES
  Principal payments on notes payable and capital lease obligations       (89,435)             (80,362)
  Payments and proceeds from revolving line of credit - net               590,174               46,526
  Proceeds from exercise of stock options and warrants                    351,610
                                                                         ---------            ---------
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES                       852,349              (33,836)
                                                                         ---------            ---------

NET INCREASE  IN CASH AND CASH EQUIVALENTS                                 58,562               21,924

Cash and cash equivalents at beginning of period                          293,186              200,201
                                                                         ---------            ---------
Cash and cash equivalents at end of period                                351,748              222,125
                                                                         =========            =========
SUPPLEMENTAL CASH FLOW INFORMATION:

Cash paid during the period for:
     Income taxes                                                       $ 130,519            $  15,158
     Interest                                                           $  48,277            $  29,421
</TABLE>

SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES:

During the six months  ended  March 31, 2004 and 2003,  the Company  incurred no
capital lease obligations for the acquisition of equipment.

See accompanying Notes to the Condensed Consolidated Financial Statements

<PAGE>


                      SYNERGX SYSTEMS INC. AND SUBSIDIARIES

            NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                         SIX MONTHS ENDED MARCH 31, 2004

                                   (UNAUDITED)

1. BASIS OF PRESENTATION

The accompanying unaudited financial statements have been prepared in accordance
with accounting  principles  generally  accepted in the United States of America
for interim financial information.  Accordingly,  they do not include all of the
information and footnotes required by accounting  principles  generally accepted
in the United  States of  America  for  complete  financial  statements.  In the
opinion of management, all adjustments (consisting of normal recurring accruals)
considered  necessary in order to make the financial  statements  not misleading
have been  included.  Results for the three and six months  ended March 31, 2004
are not  necessarily  indicative  of the results  that may be  expected  for the
fiscal year ending  September 30, 2004.  For further  information,  refer to the
consolidated  financial  statements  and footnotes  thereto  included in Synergx
Systems Inc.  ("Synergx" or "the  Company") and  Subsidiaries'  annual report on
Form 10-KSB for the year ended September 30, 2003.

2. REVENUE RECOGNITION

Product sales include sale of systems, which are similar in nature, that involve
fire alarm,  life safety and security (CCTV and card access),  transit (on board
systems) and  communication  (paging,  announcement and  audio/visual).  Product
sales  represent  sales of  product  along  with the  integration  of  technical
services at a fixed price under a contract with an electrical  contractor or end
user customer or customer  agent.  Product sales are allocated  using a constant
gross profit  percentage over the entire  contract,  and  recognized,  using the
percentage-of-completion   method  of   accounting.   The  Company   utilizes  a
units-of-work  performed method to measure  progress  towards  completion of the
contract.  The  effects  of  changes  in  contract  terms are  reflected  in the
accounting period in which they become known. Contract terms provide for billing
schedules  that  differ  from  revenue  recognition  and give  rise to costs and
estimated  profits in excess of  billings,  and  billings in excess of costs and
estimated  profits.  Costs and  estimated  profits in excess of billing were not
material  at  March  31,  2004  and 2003 and  have  been  included  in  accounts
receivable.  There were no billing in excess of costs and  estimated  profits at
March 31, 2004 and 2003.

Subcontract   sales  principally   represents   revenue  related  to  electrical
installation  of wiring and piping  performed by others for the Company when the
Company  acts  as the  prime  contractor  and  sells  its  products  along  with
electrical  installation.  Subcontract  revenue  is also  recognized  during the
entire  project  using  the  percentage-of-completion  method of  accounting  as
electrical installation is performed at the job site.

Service  revenue  from  separate  maintenance   contracts  is  recognized  on  a
straight-line  basis  over  the  terms  of the  respective  contract,  which  is
generally one year. Non-contract service revenue is recognized when services are
performed.

<PAGE>

                      SYNERGX SYSTEMS INC. AND SUBSIDIARIES

      NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - Continued

                         SIX MONTHS ENDED MARCH 31, 2004

                                   (UNAUDITED)


3. INVENTORIES

Inventories are priced at the lower of cost (first-in,  first-out) or market and
consist primarily of raw materials.

4. LONG TERM DEBT

On October 9, 2003, the Company entered into a new $3 million  revolving  credit
facility with Hudson United Bank (the "Credit  Facility").  The Credit  Facility
has an interest rate of prime plus 1/4% on outstanding  balances (4.25% at March
31,  2004) and expires in October  2005.  The Credit  Facility is secured by all
assets of the Company and all of its operating subsidiaries. Advances under this
Credit  Facility are measured  against a borrowing  base  calculated on eligible
receivables and inventory.

Initial  proceeds  from the new  Credit  Facility  were used to pay off a former
credit facility with Citizens Business Credit. At March 31, 2004 the full amount
of the Credit  Facility was available  under the borrowing base  calculation and
$1,846,000 was outstanding under this facility.

The Credit Facility includes certain  restrictive  covenants,  which among other
things, impose limitations on declaring or paying dividends,  acquisitions,  and
capital expenditures. The Company is also required to maintain certain financial
ratios and tangible net worth  covenants.  At March 31, 2004 the Company was not
in default with any of its financial covenants.

5. EXERCISE OF WARRANTS AND STOCK OPTIONS

Mirtronics the largest  stockholder of the Company had  outstanding  warrants to
purchase  620,000  shares of the Company's  Common  Stock,  which were issued in
1998,  and were  exercisable  at any time until December 31, 2003 at an exercise
price of $.51 per share.  Mirtronics  exercised  these warrants in December 2003
for a total consideration of $316,200.

During the six months ending March 31, 2004,  employee stock options to purchase
66,384  shares of Common  Stock  were  exercised  for a total  consideration  of
$35,410.

<PAGE>


                      SYNERGX SYSTEMS INC. AND SUBSIDIARIES

      NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - Continued

                         SIX MONTHS ENDED MARCH 31, 2004

                                   (UNAUDITED)

6. EARNINGS (LOSS) PER SHARE

The Financial  Accounting Standards Board ("FASB") issued Statement of Financial
Accounting  Standards  ("SFAS")  No. 128  "Earnings  Per Share"  which  requires
companies to report basic and diluted  earnings per share ("EPS")  computations.
Basic EPS excludes dilution and is based on the  weighted-average  common shares
outstanding  and diluted EPS gives  effect to potential  dilution of  securities
that could  share in the  earnings of the  Company.  Diluted  EPS  reflects  the
assumed  issuance of shares with respect to the Company's  employee stock option
plan and  warrants.  The Company did not have stock based  compensation  for the
three and six months ended March 31, 2004 or 2003.
<TABLE>
<CAPTION>

                                                      Three Months ended March 31,           Six Months ended March 31,
Basic EPS Computation                                2004                2003                2004              2003
                                              -------------------------------------     ------------------------------------
<S>                                             <C>                 <C>                 <C>               <C>
  Net Income (Loss) available to common
       stockholders                             $   58,890          $   61,615          $  (67,406)       $   83,437
  Weighted average outstanding shares            4,718,991           3,748,850           4,441,037         3,748,850
  Basic EPS (Loss)                                    $.01                $.02              $(.02)              $.02
                                                      ====                ====              ======              =====


Diluted EPS Computation

Net Income (Loss) available to common
         stockholders                           $   58,890          $   61,615          $  (67,406)       $   83,437
                                                   =======             =======            =========         ========

Weighted-average shares-basic                    4,718,991           3,748,850           4,441,037         3,748,850
                                                 ---------           ---------           ----------         ---------
 Plus:  Incremental shares from
               assumed conversions
        Employee Stock Options                     147,680              96,134             153,707            74,128
        Warrants                                   312,032             405,800             535,051           292,288
                                                  --------             -------             -------           --------

   Dilutive potential common shares                459,712             501,934             688,758           366,416
                                                   -------             -------             -------           -------
   Adjusted weighted average shares diluted      5,178,703           4,250,784           5,129,795         4,115,266
                                                 ---------           ---------           ---------         ---------

    Diluted EPS (Loss)                                $.01                $.01               $(.01)             $.02
                                                      ====                ====               ======              ====
</TABLE>

<PAGE>

                      SYNERGX SYSTEMS INC. AND SUBSIDIARIES

      NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - Continued

                         SIX MONTHS ENDED MARCH 31, 2004

                                   (UNAUDITED)

7. INVESTMENT IN SECURE 724 L.P.

On May 29, 2003, the Company (through a special purpose Nova Scotia  subsidiary)
acquired  25% of the  equity of Secure  724 LP  ("Secure  724 LP"),  an  Ontario
limited partnership, from Nafund Inc. ("Nafund") in consideration of (a) 300,000
shares of Common Stock;  (b) warrants to purchase  50,000 shares of Common Stock
at $1.15 per share for 24 months; (c) agreeing to provide secured loans of up to
Cdn$300,000 (which was approximately  $229,000 U.S. at March 31, 2004) to Secure
724 LP pro rata with  equity/loans  to be provided by Nafund and tied to certain
development  milestones  and (d) 150,000  shares of Common Stock to be issued in
the future upon Secure 724 LP satisfying the milestones and Nafund providing the
funding.  Either the Company  and/or  Nafund can elect not to provide all or any
part of the above funding  (regardless  of whether the milestones are attained).
If  milestones  are attained and either the Company  and/or Nafund elects not to
provide all or part of the above funding it would have its equity  reduced based
on a formula.

The 25%  investment  in Secure 724 L.P.  for 300,000  shares of Common Stock and
warrants to purchase 50,000 shares of Common Stock was valued at $432,500.  This
investment is accounted for utilizing the equity method and is included in OTHER
ASSETS.  The underlying equity of this investment on the date of the transaction
was  approximately  $73,000;  resulting in goodwill of  approximately  $359,500;
which will not be amortized but will be tested for impairment. For the three and
six months ended March 31, 2004, a $12,000 and $32,000, respectively, adjustment
to the equity  investment  was recorded to reflect the  Company's 25% portion of
the operating loss of Secure 724 LP.

In connection with initial capital  contribution per the partnership  agreement,
the Company advanced $18,158  (Cdn$25,000) to Secure 724 LP in May 2003 and upon
reaching milestones advanced $125,089  (Cdn$175,000) in August 2003. These notes
receivable bear interest at a rate of 4% and mature in May 2006 and August 2006,
respectively.

This  transaction was submitted to the stockholders of Synergx (as two directors
of Synergx are directors of Secure 724 LP) and approved at its Annual Meeting on
March 26, 2003.

There  can be no  assurance  that  the  investment  in  Secure  724 LP  will  be
profitable.

8. OTHER EVENTS

RePort Business Solutions

On November 20, 2003, the Company's Board of Directors  approved entering into a
revised  agreement to organize a new Ontario limited  partnership to acquire and
operate the business of RePort Business Solutions ("RePort") in partnership with
NSC Holdings Inc. ("NSCH") and Nafund Inc. ("Nafund").

This  transaction  was originally  submitted to the  stockholders of Synergx for
approval  at its Annual  Meeting on March 26,  2003  because  two  directors  of
Synergx are directors of Nafund and one is also a director and principal

<PAGE>

                      SYNERGX SYSTEMS INC. AND SUBSIDIARIES

      NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - Continued

                         SIX MONTHS ENDED MARCH 31, 2004

                                   (UNAUDITED)

8. OTHER EVENTS (Continued)

of NSCH.  Management  believes that the revised  structure and consideration are
within the scope of the stockholder approval.

Pursuant to the revised  agreement  (which is subject to approval by NSCH's bank
and completion of definitive documentation),  the Company, through a subsidiary,
would  acquire  from  Nafund,  25% of the  Class B  equity  units of  RePort  in
consideration of the issuance to Nafund of 150,000 shares of Common Stock.

RePort  which  is  currently  a  division  of  NSCH,  provides  software  to the
independent  international  investment  counseling,   portfolio  management  and
brokerage  community.  Located in  Toronto,  Ontario,  RePort's  software  links
external or outsourced trading,  custodian,  broker and bank systems in internal
diverse security and asset management  systems and contact  information  systems
and electronic filing and documentation  systems.  RePort will provide these and
related  back office  services to NSCH (which is an  investment  counselor/money
manager) and to other third party investment counselors,  money managers,  funds
and similar entities.

There can be no assurance however that this transaction will take place.

9. STOCK SPLIT

On July 7, 2003, the Company's Board of Directors declared a 2-for-1 stock split
of its  outstanding  common  stock.  The stock split took the form of a dividend
whereby the  Company  issued on July 25th to each  shareholder  of record at the
close of business on July 18, 2003 one additional  share for every share held on
that date.  The  financial  statements  and  footnotes  have been  retroactively
adjusted to reflect this stock split.

10. 2004 NON-QUALIFIED STOCK OPTION PLAN

At the Company's  annual meeting of  stockholders  on March 10, 2004 the Company
and its stockholders adopted a new nonqualified stock option plan ("2004 Plan").
Under the 2004  Plan,  the Board of  Directors  may grant  options  to  eligible
employees at exercise  prices not less than 100% of the fair market value of the
common shares at the time the option is granted.  The number of shares of Common
Stock  that may be issued  shall not  exceed  an  aggregate  of up to 10% of its
issued and outstanding  shares from time to time. Options vest at the discretion
of the Board of  Directors  at such time as the options are  granted.  Issuances
under the new 2004 Plan are to be reduced by  options  outstanding  under a 1997
nonqualified  stock  option  plan  (replaced  by the  new  2004  Plan).  Options
outstanding  under the 1997 Plan will expire from June 2004 though  December 31,
2005. As of March 31, 2004,  there were 124,914  options  outstanding  under the
1997 Plan and none outstanding under the 2004 Plan.



<PAGE>

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


Liquidity and Capital Resources

In October  2003,  the Company  entered into a new $3 million  revolving  credit
facility with Hudson United Bank.  (the "Credit  Facility") This credit facility
has an  interest  rate of prime plus 1/4% and expires in October  2005.  Initial
proceeds  from the new credit  facility  were used to pay off a credit  facility
with Citizens  Business Credit.  Advances under the Credit Facility are measured
against a borrowing base calculated on eligible  receivables and inventory.  The
Credit Facility is secured by all assets of the Company and all of its operating
subsidiaries.

The Credit Facility includes various covenants, which among other things, impose
limitations  on  declaring  or  paying   dividends,   acquisitions  and  capital
expenditures.  The Company is also required to maintain certain financial ratios
and tangible  net worth  covenants.  At March 31,  2004,  the Company was not in
default with any of its financial  covenants and at such time the full amount of
the Credit Facility was available under the borrowing base calculation. At March
31, 2004, $1,846,000 was owed under the Credit Facility.

Net cash (used) by  operations  for the six months ended March 31, 2004 amounted
to ($763,783)  as compared to cash being  provided by operations of $157,773 for
the comparable prior year period.  The increase in cash being used by operations
was due to a ($112,400)  operating loss in the 2004 six month period compared to
an  operating  profit of  $174,400 in the  comparable  2003 period and due to an
increase  in  working  capital  requirements  in  order to fund an  increase  in
inventory for projects expected to be shipped after March 31, 2004. The net cash
outflow of  ($763,783)  from  operations  during  2004  coupled  with  equipment
purchases of ($30,004)  were funded by an increase of $590,176 in bank borrowing
and from $316,200 of proceeds from exercise of warrants to purchase common stock
by  Mirtronics  and $35,410  from  exercise  of stock  options by  employees  to
purchase common stock.

The ratio of the Company's  current assets to current  liabilities  increased to
approximately  2.88 to 1 at March 31,  2004  compared  to 2.62 to 1 at March 31,
2003.  The increase in the current ratio is due to an  improvement  in cash flow
since  March  31,  2003  due to the  return  to  profitable  operations  through
September 30, 2003,  from $351,610 of proceeds from the exercise of warrants and
employees  stock  options,  and from a  increase  of $1.5  million  of  accounts
receivable in 2004. Working capital increased by $1.4 million to $6.6 million at
March 31, 2004 compared to $5.2 million at March 31, 2003;  while bank borrowing
increased by $961,000 since March 31, 2003.

<PAGE>



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


Results of Operations

Revenues and Gross Profit
<TABLE>
<CAPTION>

                                              Three Months Ended               Six Months Ended
                                                  March 31,                         March 31,
                                               2004      2003                  2004        2003
                                               ----      ----                  ----        ----
                                                         (In thousands of dollars)
<S>                                          <C>        <C>                  <C>          <C>
           Product Revenue                   $4,160     $3,514               $7,179       $6,805
           Subcontract Revenue                   65        172                  144          443
           Service Revenue                    1,165      1,103                2,269        2,178
           Total Revenue                      5,390      4,789                9,592        9,426

           Gross Profit Product               1,345      1,242                2,261        2,270
           Gross Profit Subcontract              10         27                   24           87
           Gross Profit Service                 328        321                  634          668
           Total Gross Profit                 1,683      1,590                2,919        3,025

           Gross Profit Product %               32%        35%                  31%          33%
           Gross Profit Subcontract %           15%        16%                  17%          20%
           Gross Profit Service %               28%        29%                  28%          31%
</TABLE>

Revenues

The Company's  product  revenues during the three and six months ended March 31,
2004 increased from the comparable prior year periods, representing increases of
18% and 6% for the  respective  periods.  These  increases  in product  revenues
resulted  from  an  improvement  in  economic  activity  in both  the  Company's
principal New York City market and its Dallas, Texas market. The product revenue
increase  during  current  quarter  reflects  strong  improvement  in Dallas and
revenues from New York City transit  projects where approvals for production and
shipment  were  delayed last  quarter and were  released in the current  period.
However,  the  increase  in product  revenues  still  reflects  softness  in the
Company's New York City market for its other products.  Product  revenues in our
Dallas,  Texas market area improved  significantly from very low 2003 levels. In
the Dallas,  Texas market,  higher product revenues  resulted from certain costs
reduction initiatives  implemented during the last fifteen months, which allowed
the Company to price aggressively in that competitive  market. We are continuing
to quote  business  aggressively  in both  that  area  and in the New York  City
metropolitan area.

Subcontract  revenue decreased during the current three and six month periods as
the Company was responsible for various small  electrical  installations  during
the 2004  periods  which in the  aggregate  were less than two large  electrical
installation projects in 2003.

Service  revenues  increased  during the current  three and six month periods of
2004.  The increase in both  periods is primarily  due to an increase in service
contracts as the Company  expanded  its service  base into the Long  Island,  NY
market for fire alarm  systems.  In addition,  the 2004 periods  benefited  from
call-in  service  related to several  new  customers  added  during the  current
quarter.

<PAGE>




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


Gross Profit

Gross  profit on product  revenues  for the three  months  ended March 31, 2004,
increased  8% compared to the  respective  prior year  period.  The  increase in
absolute gross profit is primarily related to higher product sales (noted above)
and related gross margin.  However, gross profit on product revenues for the six
months ended March 31, 2004 decreased 1% even though products revenues increased
6% for this period. The decrease in absolute gross profit during the current six
months period reflects lower profit margins  resulting from  aggressive  pricing
and from an increase in certain overhead costs.  Over the last two years certain
project  engineers  were  added to  support  product  expansion  in a effort  to
increase  products sales to a higher level.  While the Company's  fixed overhead
cost base  increased  the product  revenue  increase  did not occur by March 31,
2004. The decrease in gross profit  percentage  during the current three and six
month  periods  is due to a  combination  of lower than  anticipated  sales with
increased  overhead,  and aggressive pricing  (particularly in the Dallas market
area) in order to book new business.

Gross profit related to subcontract  revenues for the three and six months ended
March 31, 2004 decreased in absolute terms as the Company was  responsible for a
smaller amount of electrical installation.  However, the gross profit percentage
was lower  during  the three and six  months of 2004 as  markups  on  electrical
installation were lower due to the competitive environment during this period.

Gross  profit on service  revenues  for the three  months  ended  March 31, 2004
increased due to the increase in service  contract  revenues.  Gross profit from
service  revenues  during the six months ended March 31, 2004 decreased in spite
of an increase in service revenues. The gross profit decline for this period was
due to an increase in technicians to support  higher  service  revenues,  salary
increases,  and technicians  moving up to higher paying  categories.  These cost
increases could not be fully absorbed by price increases to service contracts or
by additional call-in service revenue.

Income Before Tax

The decline in income  before income taxes during the three and six months ended
March 31, 2004 is primarily  due to the  decrease in gross lower profit  margins
resulting  from  aggressive  pricing  in Dallas to obtain  business  and from an
increase in certain  overhead costs to support product  expansion in New York in
an effort to increase  product sales to a higher  level.  This decline in income
before tax was also  caused by lower  gross  profit  from  subcontract  revenues
(three and six months of 2004) and from lower gross  profit on service  revenues
during the six months of 2004. In addition,  selling, general and administrative
expenses  increased  (7% and 5%  during  the  three  and  six  months  of  2004,
respectively)  due to  higher  insurance  costs  in  2004  and  from  additional
management and sales staff to support  product  expansion  directed at increased
levels.  Interest expense  increased during 2004 due to higher borrowing levels.
For the three and six  month  periods  of 2004 the  Company  recorded  a loss of
$12,000 and $32,000, respectively, on its equity in the operating loss of Secure
724 LP.

Tax Provision

The Company's current income tax provision  represents federal,  state and local
income taxes. Deferred taxes represent the net change in deferred tax assets and
non current  deferred tax liability as it related to certain timing  differences
of book and tax deductions.

<PAGE>


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


Order Position

The Company's order position,  excluding service,  at March 31, 2004 amounted to
$15,800,000 as compared to $16,500,000 at September 30, 2003 and  $14,100,000 at
March 31, 2003. These historically high levels of order position reflects recent
large new orders received for several subway complexes which will be deliverable
over several  years as the projects are released and reflects  recent  increased
new orders in our Dallas, Texas Market area.. In addition,  the backlog includes
$2.5 million of orders for communication  and announcement  systems from several
transit car manufacturers, that will be shippable over the next 24 month period.
While  quotation  activity is brisk,  there is no assurance  when orders will be
received and whether the order position will increase.  Due to the fact that the
Company's  products  are sold  and  installed  as part of  larger  mass  transit
construction  projects,  there is  typically a delay  between the booking of the
contract  and its  revenue  realization.  The order  position  includes  and the
Company   continues  to  bid  on  projects   that  might   include   significant
subcontractor labor (electrical  installation  performed by others). The Company
expects to be active in seeking  orders  where the Company  would act as a prime
contractor  and  be  responsible  for  management  of the  project  as  well  as
electrical installation.


                         Item 3. Controls and Procedures

Evaluation  of  disclosure  controls and  procedures.  At the period end of this
Quarterly  Report  on Form  10-QSB,  the  Company's  management,  including  the
Company's Chief  Executive  Officer and Chief  Financial  Officer  evaluated the
effectiveness of the design and operation of the Company's  disclosure  controls
and procedures.  Based on that evaluation, the Company's Chief Executive Officer
and Chief Financial Officer have concluded, as of the end of the quarter covered
by this report, that:

The Company's  disclosure  controls and  procedures  are designed to ensure that
information  required to be  disclosed by the Company in the reports it files or
submits  under  the  Securities  Exchange  Act of 1934 is  recorded,  processed,
summarized and reported within the time periods specified.

That Company's  disclosure  controls and procedures are effective to ensure that
such  information is accumulated and  communicated to the Company's  management,
and made known to the  Company's  Chief  Executive  Officer and Chief  Financial
Officer, to allow timely decision regarding the required disclosure.

There have been no changes in the Company's  internal  controls  over  financial
report that have  materially  affected,  or is  reasonably  likely to materially
affect the Company's  internal  controls  over  financial  reporting  during the
period covered by this Quarterly Report.


                           Part II - OTHER INFORMATION

Item 1.  Legal Proceedings.

                  Not Applicable

Item 2.  Changes in Securities.

     Mirtronics the largest stockholder of the Company had outstanding  warrants
to purchase 620,000 shares of the Company's  Common Stock,  which were issued in
1998,  and were  exercisable  at any time until December 31, 2003 at an exercise
price of $.51 per share.  Mirtronics  exercised  these warrants in December 2003
for a total consideration of $316,200.

Item 3.  Defaults Upon Senior Securities.

     Not applicable

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

     The Registrant's Annual Meeting of Stockholders was held on March 10, 2004.
At the meeting, Stockholders considered and voted upon:

     (1)  the election of seven (7) directors to Synergx's Board of Directors,

     (2)  the  selection  of  Marcum &  Kleigman  LLP as  Synergx's  independent
          auditiors for the fiscal year ending September 2004

     (3)  to adopt the 2004 Non-Qualified Stock Option Plan.

         The seven nominees for director were unopposed and were, accordingly
elected by the Stockholders. The following table details the votes cast for,
against and abstained from voting on each matter considered by the Stockholders.
<TABLE>
<CAPTION>

                          MATTER                              FOR                AGAINST              ABSTAINED
         -------------------------------------------------------------------------------------------------------
<S>                                                     <C>                          <C>                      <C>
         Daniel Tamkin                                  4,446,866                    3,828                    0
         John Poserina                                  4,446,866                    3,828                    0
         Henry Schnurbach                               4,446,866                    3,828                    0
         Joseph Vitale                                  4,446,866                    3,828                    0
         Dennis McConnell                               4,446,800                    3,894                    0
         J Ian Dalrymple                                4,446,824                    3,870                    0
         Mark I. Litwin                                 4,446,824                    3,870                    0
         --------------------------------------------------------------------------------------------------------
         Auditors                                       4,444,597                    2,068                4,029
         --------------------------------------------------------------------------------------------------------
         Adoption   2004 Non-Qualified Stock            2,701,781                  47,840               15,650
         Option Plan
         --------------------------------------------------------------------------------------------------------
</TABLE>

Item 5.   Other Information.

          On January 30, 2004, the Company filed a post-effective amendment No.
1 to Form S-8 Registration Statement (Reoffer Prospectus) for 86,322 shares of
Common Stock which provides for the sales thereof by certain executive officers
and directors.

Item 6.  Exhibits and Reports on form 8-K.

(a) Exhibits

     31.1 Certification of Daniel S. Tamkin pursuant to 18 U.S.C.  Section 1350,
          as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

     31.2 Certification of John A. Poserina pursuant to 18 U.S.C.  Section 1350,
          as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

     32.1 Certifications  of Daniel S.  Tamkin  pursuant  to Section  906 of the
          Sarbanes-Oxley Act of 2002

     32.2 Certifications  of John A.  Poserina  pursuant  to Section  906 of the
          Sarbanes-Oxley Act of 2002

(b) Reports on Form 8-K

     None

Other

     The information in Item 2 and Item 6 regarding shares of Common Stock
have been adjusted for a 2 for 1 stock split that took the form of a dividend
that was distributed on July 25, 2003.

<PAGE>


                                   SIGNATURES


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

                                          SYNERGX SYSTEMS INC
                                          (Registrant)


                                          /s/ JOHN A. POSERINA
                                          ------------------------------
                                           John A. Poserina,
                                           Chief Financial Officer
                                           (Principal Accounting and
                                           Financial Officer), Secretary
                                           And Director
Date:  May 12, 2004