SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

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

                  For the quarterly period ended March 31, 2002

                         Commission file number 0-28572

                             OPTIMAL ROBOTICS CORP.
             (Exact name of registrant as specified in its charter)

CANADA                                      98-0160833
(State or Other Jurisdiction of             (I.R.S. Employer Identification No.)
Incorporation or Organization)

         4700 de la Savane, Suite 101, Montreal, Quebec, Canada H4P 1T7

                                 (514) 738-8885
              (Registrant's Telephone Number, including Area Code)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.

Yes [X] No [_]

At April 29, 2002,  the  registrant  had  15,100,535  Class "A" shares  (without
nominal or par value) outstanding.

<PAGE>

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements


                                     - 1 -
<PAGE>

OPTIMAL ROBOTICS CORP.
Consolidated Balance Sheets
(Unaudited)

March 31, 2002 and December 31, 2001
(expressed in US dollars)

<TABLE>
<CAPTION>
===================================================================================================================
                                                                                 March 31,             December 31,
                                                                                      2002                     2001
-------------------------------------------------------------------------------------------------------------------
                                                                                                          (Audited)
<S>                                                                          <C>                      <C>
Assets

Current assets:
     Cash and cash equivalents                                               $   1,819,217            $   9,616,430
     Short-term investments                                                     83,414,282               94,487,326
     Accounts receivable, net of allowance for doubtful accounts of
       $300,000 ($300,000 at December 31, 2001)                                 24,982,963                9,009,445
     Inventories (note 3)                                                       23,751,215               22,355,267
     Tax credits receivable                                                        984,057                  884,057
     Future income taxes                                                           302,834                  284,253
     Prepaid expenses and deposits                                                 697,934                  989,107
     --------------------------------------------------------------------------------------------------------------
                                                                               135,952,502              137,625,885

Property, plant and equipment                                                    6,379,082                6,130,347

Goodwill                                                                         2,730,353                2,730,353

Intangibles (note 4)                                                               964,791                  904,810

-------------------------------------------------------------------------------------------------------------------
                                                                             $ 146,026,728            $ 147,391,395
===================================================================================================================

Liabilities and Shareholders' Equity

Current liabilities:
     Accounts payable and accrued liabilities                                $   9,291,729            $   6,673,804
     Income taxes payable                                                        1,825,445                4,794,476
     Deferred revenue                                                            6,474,228                1,307,312
     --------------------------------------------------------------------------------------------------------------
                                                                                17,591,402               12,775,592

Future income taxes                                                              1,073,244                1,143,213

Shareholders' equity:
     Share capital (note 5)                                                    123,445,380              126,476,633
     Other capital                                                                   5,282                    5,282
     Retained earnings                                                           5,395,891                8,475,146
     Cumulative translation adjustment                                          (1,484,471)              (1,484,471)
     --------------------------------------------------------------------------------------------------------------
                                                                               127,362,082              133,472,590

Contingencies (note 6)

-------------------------------------------------------------------------------------------------------------------
                                                                             $ 146,026,728            $ 147,391,395
===================================================================================================================
</TABLE>

See accompanying notes to unaudited consolidated financial statements.


                                     - 2 -
<PAGE>

OPTIMAL ROBOTICS CORP.
Consolidated Statements of Operations
(Unaudited)

Three-month periods ended March 31, 2002 and 2001
(expressed in US dollars)

===============================================================================
                                                           2002            2001
-------------------------------------------------------------------------------

Revenues                                           $ 20,374,389    $ 19,607,998

Cost of sales                                        12,918,677      12,271,007

-------------------------------------------------------------------------------
Gross margin                                          7,455,712       7,336,991

Expenses (income):
     Selling, general and administrative              6,528,179       3,417,893
     Research and development (note 7)                  400,734         330,004
     Amortization                                       614,947         297,675
     Operating lease                                    395,192         206,352
     Investment income                                 (705,006)     (1,056,511)
     --------------------------------------------------------------------------
                                                      7,234,046       3,195,413

-------------------------------------------------------------------------------
Earnings before income taxes                            221,666       4,141,578

Income taxes provision (note 8)                         115,450       1,622,140

-------------------------------------------------------------------------------
Net earnings                                       $    106,216    $  2,519,438
===============================================================================

Weighted average number of shares:
     Basic                                           15,384,010      13,807,141
     Plus impact of stock options and warrants           21,323       1,277,064

-------------------------------------------------------------------------------
     Diluted                                         15,405,333      15,084,205
===============================================================================

Earnings per share:
     Basic                                         $       0.01    $       0.18
     Diluted                                               0.01            0.17

===============================================================================

See accompanying notes to unaudited consolidated financial statements.


                                     - 3 -
<PAGE>

OPTIMAL ROBOTICS CORP.
Consolidated Statements of Retained Earnings
(Unaudited)

Three-month periods ended March 31, 2002 and 2001
(expressed in US dollars)

<TABLE>
<CAPTION>
============================================================================================
                                                                       2002             2001
--------------------------------------------------------------------------------------------
<S>                                                             <C>              <C>
Retained earnings (deficit), beginning of period                $ 8,475,146      $  (830,545)

Net earnings                                                        106,216        2,519,438

Excess of purchase price over book value of shares (note 5)      (3,185,471)              --

--------------------------------------------------------------------------------------------
Retained earnings, end of period                                $ 5,395,891      $ 1,688,893
============================================================================================
</TABLE>

See accompanying notes to unaudited consolidated financial statements.


                                     - 4 -
<PAGE>

OPTIMAL ROBOTICS CORP.
Consolidated Statements of Cash Flows
(Unaudited)

Three-month periods ended March 31, 2002 and 2001
(expressed in US dollars)

<TABLE>
<CAPTION>
===================================================================================================
                                                                             2002              2001
---------------------------------------------------------------------------------------------------
<S>                                                                  <C>               <C>
Cash flows from operating activities:
     Net earnings                                                    $    106,216      $  2,519,438
     Adjustments for:
         Amortization                                                     614,947           297,675
         Unrealized foreign exchange loss on contract advance                  --           121,768
         Non-refundable tax credits                                            --          (113,662)
         Future income taxes                                              (88,550)        1,622,140
         Loss on securitization of accounts receivable                         --            24,424
     Changes in operating assets and liabilities:
         Amounts receivable                                           (15,973,518)      (11,014,079)
         Proceeds on securitization of trade accounts receivable               --         3,038,907
         Inventories                                                   (1,395,948)       (2,910,904)
         Tax credits receivable                                          (100,000)           44,106
         Prepaid expenses and deposits                                    291,173          (498,556)
         Accounts payable and accrued liabilities                       2,617,925         2,960,852
         Income taxes payable                                          (2,969,031)               --
         Deferred revenue                                               5,166,916         2,729,683
---------------------------------------------------------------------------------------------------
                                                                      (11,729,870)       (1,178,208)
Cash flows from financing activities:
     Proceeds from issuance of common shares                                   --         1,735,978
     Repurchase of common shares                                       (6,216,724)               --
     ----------------------------------------------------------------------------------------------
                                                                       (6,216,724)        1,735,978
Cash flows from investing activities:
     Purchase of capital assets                                          (923,663)         (805,953)
     Decrease in short-term investments                                11,073,044         5,214,219
     ----------------------------------------------------------------------------------------------
                                                                       10,149,381         4,408,266

---------------------------------------------------------------------------------------------------
Net (decrease) increase in cash and cash equivalents
   during the period                                                   (7,797,213)        4,966,036

Cash and cash equivalents, beginning of period                          9,616,430         5,006,982

---------------------------------------------------------------------------------------------------
Cash and cash equivalents, end of period                             $  1,819,217      $  9,973,018
===================================================================================================

Cash and cash equivalents consist of:
     Cash balances with banks                                        $  1,819,217      $  6,123,697
     Short-term investments                                                    --         3,849,321

---------------------------------------------------------------------------------------------------
                                                                     $  1,819,217      $  9,973,018
===================================================================================================

Supplementary disclosure of cash flow information:
     Cash paid during the period for:
         Interest                                                    $      4,010      $     33,000
         Income taxes                                                   3,173,030            10,000
===================================================================================================
</TABLE>

See accompanying notes to unaudited consolidated financial statements.


                                     - 5 -
<PAGE>

OPTIMAL ROBOTICS CORP.
Notes to Consolidated Financial Statements
(Unaudited)

Three-month periods ended March 31, 2002 and 2001
(expressed in US dollars)

================================================================================

1.   Interim financial information:

     These consolidated financial statements have been prepared by management in
     accordance with Canadian  generally  accepted  accounting  principles.  The
     unaudited  balance sheet as at March 31, 2002 and the unaudited  statements
     of operations, retained earnings and cash flows for the periods ended March
     31,  2002 and  2001  reflect  all  adjustments  which,  in the  opinion  of
     management, are necessary to a fair statement of the results of the interim
     periods presented. The Company's revenue and income are subject to seasonal
     variations.  Consequently,  the results of operations for the first quarter
     ended March 31, 2002 are not  traditionally  indicative  of the results for
     the full year. These interim  consolidated  financial statements follow the
     same accounting  policies and methods of their  application as described in
     note 2 of the annual consolidated  financial  statements for the year ended
     December 31, 2001.  The interim  consolidated  financial  statements do not
     include all disclosures required for annual financial statements and should
     be read in conjunction with the most recent annual  consolidated  financial
     statements of the Company as at and for the year ended December 31, 2001.

     Certain of the prior year amounts have been  reclassified to conform to the
     current fiscal year presentation. These changes had no impact on previously
     reported  results  of  operations,   financial   position,   cash  flow  or
     shareholders' equity.

     All  amounts  in the  attached  notes  are  unaudited  unless  specifically
     identified.

2.   Significant accounting policies:

     (a)  Stock-based compensation:

          Effective January 1, 2002, the Company adopted the new recommendations
          of the Canadian Institute of Chartered Accountants ("CICA"),  Handbook
          Section  3870,   with  respect  to  the  accounting  for   stock-based
          compensation and other stock-based  payments.  The new recommendations
          require that all stock-based  payments to non-employees,  and employee
          awards that are direct awards of stock, call for settlement in cash or
          other  assets,  or  are  stock  appreciation   rights  that  call  for
          settlement by the issuance of equity instruments,  granted on or after
          January 1, 2002 be accounted for using the fair value method.  For all
          other  stock-based  employee  compensation  awards,  the  CICA has not
          prescribed  specific methods,  and therefore the Company has chosen to
          continue to follow its existing policy of using the settlement  method
          of accounting as permitted under the new standard.  Under this method,
          no compensation expense is recognized when stock options are issued to
          employees.  Any consideration received from the plan participants upon
          exercise of stock options is credited to share capital.

          The new  standard  requires  that the Company  disclose  the pro forma
          effect of accounting  for all  stock-based  awards  granted during the
          three-month  period  ended March 31,  2002 under the fair  value-based
          method.

          There is no impact on the Company's  consolidated  financial position,
          results of  operations  and cash flows as a result of  adopting  these
          recommendations.


                                     - 6 -
<PAGE>

OPTIMAL ROBOTICS CORP.
Notes to Consolidated Financial Statements, Continued
(Unaudited)

Three-month periods ended March 31, 2002 and 2001
(expressed in US dollars)

================================================================================

2.   Significant accounting policies (continued):

     (b)  Goodwill and other intangible assets:

          Effective January 1, 2002, the Company adopted the new recommendations
          of the CICA, Handbook Section 3062, with respect to the accounting for
          goodwill  and  other  intangible  assets.  The  standard  changes  the
          accounting   for   goodwill   from  an   amortization   method  to  an
          impairment-only  approach. In addition, the standard requires acquired
          intangible  assets to be  separately  recognized if the benefit of the
          intangible  assets is  obtained  through  contractual  or other  legal
          right, or if the intangible assets can be sold, transferred, licensed,
          rented or exchanged.

          The change was accounted for prospectively. The Company did not record
          an  amortization of goodwill in the three months ended March 31, 2002.
          Goodwill was tested for impairment  during the first quarter of fiscal
          2002.  The fair value of the Alpha  Microsystems  business,  which was
          acquired  during the second  quarter of fiscal 2001 and from which the
          goodwill  arose,  was  estimated  using the expected  present value of
          future cash flows.  Management considered that there was no impairment
          in the carrying value of goodwill.

          There  has been no change in the  estimated  useful  life of the other
          intangible   assets  which   continue  to  be   amortized   using  the
          straight-line method at the following annual rates:

          ======================================================================

          Customer list                                                     25%
          Patents                                                            5%

          ======================================================================

          As  required   under  CICA  Handbook   Section  3062,   the  following
          information is presented:

          ======================================================================
                                                              2002          2001
          ----------------------------------------------------------------------

          Reported net earnings                           $106,216    $2,519,438
          Add back goodwill amortization                        --            --

          ----------------------------------------------------------------------
          Adjusted net earnings                           $106,216    $2,519,438
          ======================================================================

          The  acquisition  which gave rise to the  recording  of goodwill  only
          occurred during the second quarter of fiscal 2001. Accordingly,  there
          was no  goodwill or  amortization  thereof  recorded  in the  accounts
          during the three  months  ended March 31, 2001 and thus,  there was no
          impact on the Company's results of operations and earnings per share.


                                     - 7 -
<PAGE>

OPTIMAL ROBOTICS CORP.
Notes to Consolidated Financial Statements, Continued
(Unaudited)

Three-month periods ended March 31, 2002 and 2001
(expressed in US dollars)

================================================================================

3.   Inventories:

     ===========================================================================
                                                   March 31,        December 31,
                                                        2002                2001
     ---------------------------------------------------------------------------
                                                                       (Audited)

     Finished goods                              $ 1,668,070         $ 2,778,678
     Work in process                                 645,756             542,378
     Raw materials                                 8,267,880           6,969,536
     Replacement parts                            13,169,509          12,064,675

     ---------------------------------------------------------------------------
                                                 $23,751,215         $22,355,267
     ===========================================================================

4.   Intangibles:

     ===========================================================================
                                                                       March 31,
                                                                            2002
     ---------------------------------------------------------------------------

                                Gross carrying      Accumulated         Net book
                                        amount     amortization            value
     ---------------------------------------------------------------------------

     Customer list              $      786,414    $      65,321    $     721,093
     Patents                           260,759           17,061          243,698

     ---------------------------------------------------------------------------
                                $    1,047,173    $      82,382    $     964,791
     ===========================================================================

     ===========================================================================
                                                                    December 31,
                                                                            2001
     ---------------------------------------------------------------------------
                                                                       (Audited)

                                Gross carrying      Accumulated         Net book
                                        amount     amortization            value
     ---------------------------------------------------------------------------

     Customer list              $      786,414    $      26,000    $     760,414
     Patents                           158,364           13,968          144,396

     ---------------------------------------------------------------------------
                                $      944,778    $      39,968    $     904,810
     ===========================================================================


                                     - 8 -
<PAGE>

OPTIMAL ROBOTICS CORP.
Notes to Consolidated Financial Statements, Continued
(Unaudited)

Three-month periods ended March 31, 2002 and 2001
(expressed in US dollars)

================================================================================

5.   Share capital:

     Changes in the issued and outstanding share capital were as follows:

<TABLE>
<CAPTION>
============================================================================================================
                                                March 31, 2002                      March 31, 2001
                                          -----------------------------         ----------------------------
                                              Number            Dollars             Number           Dollars
------------------------------------------------------------------------------------------------------------
<S>                                       <C>             <C>                   <C>            <C>
     Balance, December 31,
       2001 and 2000                      15,471,335      $ 126,476,633         13,708,690     $ 107,050,914

     Issued for cash pursuant to
       exercise of stock options                  --                 --             14,000            64,688

     Issued pursuant to exercise
       of warrants:                               --                 --            253,420                --
       - Ascribed value from other
           capital                                --                 --                 --             4,402
       - Cash                                     --                 --                 --         1,671,290

     Stock repurchase plan (i)              (370,800)        (3,031,253)                --                --

------------------------------------------------------------------------------------------------------------
     Balance, March 31, 2002
       and 2001                           15,100,535      $ 123,445,380         13,976,110     $ 108,791,294
============================================================================================================
</TABLE>

     (i)  On  February  26,  2002,  the  Board  of  Directors  approved  a stock
          repurchase  program  authorizing the Company to purchase up to 750,000
          of the Company's Class "A" shares in the open market  commencing March
          5, 2002 and ending March 4, 2003. As at March 31, 2002, 370,800 shares
          having a book value of  $3,031,253  had been  repurchased  for a total
          consideration  of  $6,216,724.  The excess of the purchase  price over
          book value of the shares in the amount of  $3,185,471  was  charged to
          retained earnings.

6.   Contingencies:

     (a)  In 1995 and 1996,  the Company  received  demand letters from the same
          claimant  alleging  patent  infringement.  In July 1999,  the claimant
          filed a civil action alleging patent infringement in the United States
          District  Court for the  District of Utah  against the Company and PSC
          Inc., one of the Company's suppliers.  In addition, a similar suit has
          been  filed  in the  State  of  Utah  against  one  of  the  Company's
          customers.  The  Company  is  contractually  bound  to  indemnify  the
          customer for any damages it incurs in  connection  with such suit.  At
          the Company's  expense,  the Company's legal counsel is defending this
          suit.  The Company also received a lawyer's  letter from another party
          in 1999, and again in February 2001, alleging  infringement of another
          patent.


                                     - 9 -
<PAGE>

OPTIMAL ROBOTICS CORP.
Notes to Consolidated Financial Statements, Continued
(Unaudited)

Three-month periods ended March 31, 2002 and 2001
(expressed in US dollars)

================================================================================

6.   Contingencies (continued):

     (a)  (Continued):

          The Company  believes  these claims to be without merit and intends to
          vigorously  defend its position.  Consequently,  no provision has been
          made in these financial statements with respect to the above claims.

     (b)  The  Company is party to  litigation  arising in the normal  course of
          operations. The Company does not expect the resolution of such matters
          to have a  materially  adverse  effect on the  financial  position  or
          results of operations of the Company.

7.   Research and development:

     ===========================================================================
                                                            2002           2001
     --------------------------------------------------------------------------

     Research and development expenses                 $ 500,734      $ 399,560
     Less tax credits                                   (100,000)       (69,556)

     --------------------------------------------------------------------------
                                                       $ 400,734      $ 330,004
     ==========================================================================

8.   Income taxes:

     The income tax provision  differs from the amount  computed by applying the
     combined  Canadian  federal and Quebec tax rates to earnings  before income
     taxes.  The reasons for the  difference  and the related tax effects are as
     follows:

     ===========================================================================
                                                            2002            2001
     --------------------------------------------------------------------------

     Earnings before income taxes                      $ 221,666      $4,141,578
     ===========================================================================

     Combined Canadian federal and Quebec
       provincial income taxes at 36% (2001 - 37%)     $  79,800      $1,532,384
     Foreign exchange (1)                                 51,417              --
     Permanent differences and other                     (15,767)         89,756

     --------------------------------------------------------------------------
     Income tax provision                              $ 115,450      $1,622,140
     ===========================================================================


                                     - 10 -
<PAGE>

OPTIMAL ROBOTICS CORP.
Notes to Consolidated Financial Statements, Continued
(Unaudited)

Three-month periods ended March 31, 2002 and 2001
(expressed in US dollars)

================================================================================

8.   Income taxes (continued):

     (1)  For purposes of calculating the income tax provision of the Company, a
          tax liability is recognized on the foreign  exchange gains which arise
          on the  conversion  into Canadian  dollars of the net monetary  assets
          denominated  in U.S.  dollars  which  is  required  for tax  purposes.
          Because these financial statements are presented in U.S. dollars, this
          foreign  exchange  gain does not impact  earnings  before income taxes
          even though the income tax provision includes a tax liability for this
          gain.  Future  fluctuations  in the foreign  exchange rate between the
          Canadian  and U.S.  dollar  will  change  the  amount  of the  foreign
          exchange  gains  (losses)  and thus the  provision  for  income  taxes
          thereon.

     The provision for income taxes is composed of the following:

     ---------------------------------------------------------------------------
                                                            2002            2001
     ===========================================================================

     Current income taxes                            $   204,000      $       --
     Future income taxes                                 (88,550)      1,622,140

     ---------------------------------------------------------------------------
                                                     $   115,450      $1,622,140
     ===========================================================================

9.   Segmented information:

     The  Company  operates  in  one  segment,   the   development,   marketing,
     installation, servicing and sale of automated transaction products designed
     for use in the retail sector. Substantially all of the Company's revenue is
     derived  from  sales to  retailers  located  in the  United  States  and is
     denominated in U.S. dollars.  Property,  plant and equipment,  goodwill and
     intangibles by geographic area are as follows:

     ---------------------------------------------------------------------------
                                                       March 31,    December 31,
                                                            2002            2001
     ===========================================================================
                                                                       (Audited)

     Canada                                          $ 4,886,436      $4,436,119
     United States                                     5,187,790       5,329,391

     ---------------------------------------------------------------------------
                                                     $10,074,226      $9,765,510
     ===========================================================================


                                     - 11 -
<PAGE>

OPTIMAL ROBOTICS CORP.
Notes to Consolidated Financial Statements, Continued
(Unaudited)

Three-month periods ended March 31, 2002 and 2001
(expressed in US dollars)

================================================================================

10.  Additional  disclosures  required  by U.S.  GAAP  and  differences  between
     Canadian GAAP and U.S. GAAP:

     (a)  Consolidated statement of operations:

          The  reconciliation  of earnings  reported in accordance with Canadian
          GAAP with U.S. GAAP is as follows:

<TABLE>
<CAPTION>
          ==========================================================================================
                                                                        March 31,          March 31,
                                                                             2002               2001
          ------------------------------------------------------------------------------------------
<S>                                                                 <C>               <C>
          Net earnings in accordance with Canadian GAAP             $     106,216     $    2,519,438
          Stock-based compensation costs (i)                            9,745,833        (14,008,625)

          ------------------------------------------------------------------------------------------
          Net earnings (loss) in accordance with U.S. GAAP          $   9,852,049     $  (11,489,187)
          ==========================================================================================

          Earnings (loss) per share:
               Basic                                                $        0.64     $       (0.83)
               Diluted                                                       0.64             (0.83)
          ==========================================================================================
</TABLE>

     (i)  Accounting for stock-based compensation:

          For stock-based compensation plans, the Company has chosen to use, for
          U.S. GAAP purposes,  the intrinsic  value method (APB Opinion No. 25),
          which requires  compensation costs to be recognized on the difference,
          if any, between the quoted market price of the stock at the grant date
          and the amount the individual  must pay to acquire the stock.  Certain
          of the Company's stock options are variable because the exercise price
          is  not  known  until  the  options  are   exercised.   As  a  result,
          compensation cost is measured on the date the options are exercised.

          Under  Canadian  GAAP,  the  Company  uses the  settlement  method  of
          accounting for options and compensation expense is not recognized.

     (ii) Accounting for the Impairment or Disposal of Long-lived Assets:

          SFAS No. 144 provides  accounting guidance for long-lived assets to be
          disposed of other than by sale,  and to be  disposed of by sale.  This
          statement is effective for the Company's fiscal year beginning January
          1,  2002.  The  adoption  of this  standard  did not  have an  initial
          material impact on its financial statements.


                                     - 12 -
<PAGE>

OPTIMAL ROBOTICS CORP.
Notes to Consolidated Financial Statements, Continued
(Unaudited)

Three-month periods ended March 31, 2002 and 2001
(expressed in US dollars)

================================================================================

10.  Additional  disclosures  required  by U.S.  GAAP  and  differences  between
     Canadian GAAP and U.S. GAAP (continued):

     (b)  Consolidated balance sheets:

<TABLE>
<CAPTION>
          ======================================================================================================
                                                     March 31, 2002                       December 31, 2001
                                               ---------------------------           ---------------------------
                                               Canadian                 US           Canadian                 US
                                                   GAAP               GAAP               GAAP               GAAP
          ------------------------------------------------------------------------------------------------------
                                                                                           (Audited)
<S>                                       <C>                <C>                <C>                <C>
          Shareholders' equity:
               Share capital              $ 123,445,380      $ 165,901,943      $ 126,476,633      $ 168,933,196
               Other capital                      5,282         29,894,319              5,282         39,640,152
               Retained earnings
                 (deficit)                    5,395,891        (65,415,947)         8,475,146        (72,082,525)
               Cumulative translation
                 adjustment                  (1,484,471)                --         (1,484,471)                --
               Accumulated other
                 comprehensive loss                  --         (3,018,233)                --         (3,018,233)

          ------------------------------------------------------------------------------------------------------
                                          $ 127,362,082      $ 127,362,082      $ 133,472,590      $ 133,472,590
          ======================================================================================================
</TABLE>

     (c)  Recent accounting pronouncements:

          In August  2001,  FASB  issued  SFAS No.  143,  "Accounting  for Asset
          Retirement  Obligations".  SFAS No. 143 requires the Company to record
          the fair value of an asset retirement obligation as a liability in the
          period  in which  it  incurs a legal  obligation  associated  with the
          retirement of tangible  long-lived assets. This statement is effective
          for the Company's  fiscal year beginning  January 1, 2003. The Company
          does  not  expect  SFAS  No.  143 to  have a  material  impact  on its
          financial statements.


                                     - 13 -
<PAGE>

Item 2.           MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

     This Form 10-Q  contains  certain  forward-looking  statements  within  the
meaning of Section 27A of the  Securities  Act of 1933, as amended,  and Section
21E of the Securities Exchange Act of 1934, as amended, which are intended to be
covered by the safe  harbors  created  thereby.  These  statements  are based on
current   expectations   and   assumptions   that  are   subject  to  risks  and
uncertainties.  Actual results could differ  materially  because of factors such
as: we principally depend on one line of products; we relied on one customer for
a majority of our revenues in 2001; we may not be able to manage our growth;  we
rely on third  party  suppliers;  our  U-Scan(R)  systems are  assembled  at two
facilities;  we may not be able to keep  pace with  changes  in  technology;  we
depend upon key  personnel;  competition  could  reduce  revenue from the U-Scan
system;  our products may contain defects;  the adverse resolution of litigation
against us could  adversely  impact  our  business;  organized  labor may resist
U-Scan; we may be vulnerable to technological  problems; and economic conditions
in the United  States and Canada,  affecting  the  self-checkout  industry,  are
beyond our control and may result in reduced demand and pricing  pressure on our
products,  all as discussed in our annual report on Form 10-K for the year ended
December 31, 2001.

     The  following  discussion  of  the  financial  condition  and  results  of
operations  of our  company  should  be read in  conjunction  with  our  audited
consolidated  financial statements for the year ended December 31, 2001, and the
foregoing  factors.  All dollar amounts are expressed in U.S. dollars and, other
than those  expressed  in millions of dollars,  have been rounded to the nearest
thousand.

Overview

     We are the leading  provider of  self-checkout  systems to retailers in the
United  States.  Our  principal  product is the U-Scan  automated  self-checkout
system which  enables  shoppers to scan,  bag and pay for their  purchases  with
little or no assistance from store personnel.

     The U-Scan system can be operated  quickly and easily by shoppers and makes
the checkout  process more  convenient.  The U-Scan  system  reduces the cost of
checkout  transactions  to retailers and addresses  labor  shortage  problems by
replacing manned checkout counters with our automated self-checkout stations.

     We believe that the potential market for self-checkout  solutions  includes
applications beyond  supermarkets and supercenters.  General merchandise stores,
home  improvement  stores and other  big-box  retailers  have begun to  purchase
self-checkout  systems.  Other  types of stores  that we have  identified  where
self-checkout  systems  could be used  include drug  stores,  warehouse  stores,
office superstores and toy stores.

     We  prepare  our  consolidated  financial  statements  in  accordance  with
accounting   principles   which  are   generally   accepted  in  Canada  with  a
reconciliation to accounting principles generally accepted in the United States,
as  disclosed  in note 10 of the  notes to our  interim  consolidated  financial
statements for the periods ended March 31, 2002 and 2001.

Change in accounting policy

     Effective January 1, 2002, the Company adopted the new  recommendations  of
the Canadian  Institute of Chartered  Accountants with respect to the accounting
for goodwill and other  intangible


                                     - 14 -
<PAGE>

assets.  The standard  changes the accounting for goodwill from an  amortization
method to an  impairment-only  approach.  In  addition,  the  standard  requires
acquired  intangible  assets to be  separately  recognized if the benefit of the
intangible  assets is obtained  through  contractual or other legal right, or if
the intangible assets can be sold, transferred, licensed, rented or exchanged.

     The change was accounted for  prospectively.  The Company did not record an
amortization of goodwill in the three months ended March 31, 2002.  Goodwill was
tested for impairment during the first quarter of fiscal 2002. The fair value of
the Alpha Microsystems ("Alpha") business,  which was acquired during the second
quarter of fiscal 2001 and from which the goodwill  arose,  was estimated  using
the expected present value of future cash flows. We considered that there was no
impairment in the carrying value of goodwill.

Financial Condition

     Our cash and short-term  investment portfolio amounted to $85,233,000 as at
March 31, 2002,  compared to  $104,104,000 as at December 31, 2001. The decrease
relates primarily to cash used in operations (primarily the increase in accounts
receivable) and funds used for the repurchase for  cancellation of our Class "A"
shares.  Our  portfolio  of  short-term   investments   consists  of  short-term
discounted notes. Our investments are liquid and investment grade. The portfolio
is  invested in U.S.  and  Canadian  dollar  denominated  securities,  which are
short-term to minimize interest rate risk.

     Our  inventory  position  at  March  31,  2002  was  $23,751,000,  up  from
$22,355,000  at the end of 2001.  This  increase is mainly  attributable  to raw
materials  and  replacement  parts  amounting  to  $8,267,000  and  $13,170,000,
respectively,  for  March 31,  2002  compared  to  $6,970,000  and  $12,065,000,
respectively, for December 2001. Raw materials increased in order to provide for
deliveries  in the  second  quarter of 2002.  The  replacement  parts  inventory
increased  in order to service  additional  systems  sold during the period.  We
believe that,  considering our current installed base, this level of replacement
parts is appropriate for the current servicing and support of our customers.

     We have no long-term  debt.  Shareholders'  equity as at March 31, 2002 was
$127,362,000  as compared to  $133,473,000 as at December 31, 2001. The decrease
is  attributable  to the repurchase of 370,800 shares under the Company's  stock
repurchase  program for a total  consideration  of  $6,217,000.  On February 26,
2002,  the  Board  of  Directors  had  approved  the  stock  repurchase  program
authorizing  the Company to purchase up to 750,000  Class "A" shares in the open
market. The share repurchase program expires March 4, 2003.

Results of Operations

First Three Months of 2002 Compared with First Three Months of 2001

     Total revenues  increased by $766,000,  or 4%, in the first three months of
the year compared to last year. Our sales were impacted by a general weakness in
the economy  and in  particular  due to reduced  Information  Technology  ("IT")
spending by our customers.

     Total cost of sales increased by $648,000, or 5%, in the three-month period
ended  March 2002  compared  to the first  quarter  of 2001.  The  increase  was
consistent with the increase in sales.


                                     - 15 -
<PAGE>

Overall, gross margins remained constant as a percentage of sales at 37% for the
three-month periods ended March 31, 2002 and 2001.

     Gross research and development expenses increased by $101,000, or 25%, from
2001 to 2002. As a percentage of total revenues,  gross research and development
expenses  remained  constant at 2% for both three-month  periods ended March 31,
2001 and 2002.  Research and  development  expenses for the  three-month  period
ended March 31, 2002 included  continuing costs of completion of the development
of the U-Scan Mobile  Attendant(TM)  device and the development of an electronic
signature  capture  interface and process;  a paging  feature;  a lower profile,
smaller  footprint  U-Scan  system;  and the  improvement  of the graphical user
interface (GUI).

     Selling, general,  administrative and operating lease expenses increased by
$3,299,000, or 91%, in 2002 compared to 2001. As a percentage of total revenues,
these expenses  increased from 18% to 34%. The increase was  attributable to the
following  items:  the  inclusion  of the  operating  costs of  Optimal  Systems
Services (formerly Alpha) which was acquired in May 2001;  increased  investment
in sales and marketing; and an increase in support, technical and administrative
staff in order to service the expanded customer base.

     The  Company's  net  earnings  were  $106,000  in the  quarter  compared to
$2,519,000  in 2001. On a per share basis,  the Company  earned $0.01 (basic and
diluted) compared to $0.18 ($0.17 on a diluted basis) in 2001.

Liquidity and Capital Resources

     As of  March  31,  2002,  we had  cash,  cash  equivalents  and  short-term
investments  of  $85,233,000  (2001 -  $104,104,000),  and  working  capital  of
$118,361,000 (2001 - $124,850,000).

     Operating  activities used  $11,730,000 of cash and cash equivalents in the
first three months of 2002,  compared to $1,178,000  used during the first three
months of 2001.  The increase  reflects lower earnings in the quarter as well as
the Company's  additional  investment in accounts  receivable at March 31, 2002.
Under an agreement with a Canadian  chartered bank, the Company has the right to
sell  designated  accounts  receivable to the bank on a non-recourse  basis.  No
receivables were sold by the Company in the period ended March 31, 2002, whereas
$6,469,000  and   $3,063,000   were  sold  in  December  2001  and  March  2001,
respectively.

     During the first  three  months of 2002,  the  Company,  through  its stock
repurchase program,  repurchased for cancellation 370,800 Class "A" shares at an
average price of $16.77 for a total  consideration  of $6,217,000.  In addition,
during the first three  months in 2002,  the Company did not issue any Class "A"
shares pursuant to the exercise of options or warrants, whereas during the first
three months of 2001, the Company  issued  267,420 Class "A" shares  pursuant to
the exercise of options and  warrants,  which  resulted in net cash  proceeds of
$1,736,000.

     In the first three months of 2002,  the Company  invested  $924,000  (2001-
$806,000),  to purchase capital assets,  which  principally  related to computer
equipment and software and testing units.

     We believe that our cash, cash equivalents and short-term  investments will
be adequate to meet our needs for at least the next 12 months.


                                     - 16 -
<PAGE>

Item 3. There have been no material changes since December 31, 2001.


                                     - 17 -
<PAGE>

PART II. OTHER INFORMATION

Item 1.
Legal Proceedings

     In each of 1995  and  1996,  we  received  a  demand  letter  from the same
claimant  alleging that the U-Scan system infringes upon the claimant's  patent.
In July 1999,  this claimant filed a civil action in the United States  District
Court for the District of Utah  against us and PSC, the former  assembler of the
U-Scan system,  alleging patent infringement.  A second party also sent a demand
letter to us in 1999,  and again in February 2001,  alleging a different  patent
infringement.  Although  after  consultation  with counsel,  we believe that the
former  claimant  should not prevail in its lawsuit and that the latter claimant
should not  prevail if a lawsuit is brought to assert its claim,  and that these
claims will not have a material adverse effect on our business or prospects,  no
assurance can be given that a court will not find that the system infringes upon
one or both of such  claimants'  rights.  A  determination  by a court  that the
system  infringes  upon either of the  claimant's  rights  would have a material
adverse effect on our business and results of operations.

     Kroger and one of its subsidiaries have also been sued by the same claimant
in the  State of Utah  based  upon the same  issues  underlying  the suit  filed
against us in 1999. At our expense, our counsel is also defending Kroger and its
subsidiary in such action.  Furthermore, we are contractually bound to indemnify
Kroger for any damages that it may incur in connection with such suit.

     We are also party to litigation arising in the normal course of operations.
We do not expect the  resolution  of such matters to have a  materially  adverse
effect on our financial position or results of operations.

Item 2. The registrant has nothing to report under this item.

Items 3. through 5. The registrant has nothing to report under these items.

Item 6.

(a)  Exhibits - Not applicable.

(b)  Reports on Form 8K : Form 8-K filed with the  Commission  on  February  28,
     2002 (Item 7- Exhibits).


                                     - 18 -
<PAGE>

                                   Signatures

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

                                               OPTIMAL ROBOTICS CORP.

Dated: May 2, 2002                        By:  /s/ Holden L. Ostrin
                                               ---------------------------------
                                                   Holden L. Ostrin
                                                   Co-Chairman


                                          By:  /s/ Gary S. Wechsler
                                               ---------------------------------
                                                   Gary S. Wechsler
                                                   Treasurer and Chief Financial
                                                   Officer


                                     - 19 -
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