UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB

[   X  ] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
         ACT OF 1934
For the quarterly period ended:                               December 31, 2003


[      ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
         ACT OF 1934
For the transition period from                      to
                                -------------------     -------------------

Commission file number:          0-16749

                                  CERBCO, Inc.
        (Exact name of small business issuer as specified in its charter)

          Delaware                                             54-1448835
(State or other jurisdiction of                             (I.R.S. Employer
 incorporation or organization)                            Identification No.)

 3421 Pennsy Drive, Landover, Maryland                         20785-1608
(Address of principal executive offices)                       (Zip Code)


            Issuer's telephone and fax numbers, including area code:
                               301-773-1784 (tel)
                               301-322-3041 (fax)


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 last 12 months  (or such
shorter period that the  registrant was required to file such reports),  and (2)
has been subject to such filing requirements for the past 90 days.

     Yes             X           No
                ------------              ------------


As of February 3, 2004,  the following  number of shares of each of the issuer's
classes of common stock were outstanding:

                 Common Stock                    1,196,899
                 Class B Common Stock              291,057
                                                 --------
                 Total                           1,487,956

Transitional Small Business Disclosure Format:    Yes              No     X
                                                      ----------      ----------


<PAGE>


                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION                                                                            Page
------------------------------                                                                            ----

<S>  <C>                                                                                                    <C>
Item 1.  Financial Statements..........................................................................     3

         Condensed Consolidated Statements of Operations for the Three Months and Six Months Ended
         December 31, 2003 and December 31, 2002 (unaudited)...........................................     3

         Condensed Consolidated Balance Sheet as of December 31, 2003 (unaudited)......................     4

         Condensed Consolidated Statements of Cash Flows for the Six Months Ended December 31, 2003
         and December 31, 2002 (unaudited).............................................................     5

         Notes to Condensed Consolidated Financial Statements (unaudited)..............................     6

Item 2.  Management's Discussion and Analysis of Financial Condition and Results of Operations.........     8

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

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

Item 6.   Exhibits and Reports on Form 8-K..............................................................   12
</TABLE>



<PAGE>


                         PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

                                  CERBCO, Inc.
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (unaudited)

<TABLE>
                                                        Three Months Ended Dec. 31,           Six Months Ended Dec. 31,
                                                        ---------------------------           -------------------------
<CAPTION>
                                                          2003              2002                2003             2002
                                                          ----              ----                ----             ----

<S>                                                      <C>              <C>                 <C>              <C>
Sales                                                    $      0         $       0           $        0       $       0
                                                         --------         ---------           ----------       ---------

Costs and Expenses:
  General and administrative expenses                     164,303           121,914              329,900         257,953
                                                         --------         ---------           ----------       ---------
    Total Costs and Expenses                              164,303           121,914              329,900         257,953
                                                         --------         ---------           ----------       ---------

Operating Loss                                           (164,303)         (121,914)            (329,900)       (257,953)

Investment Income                                          36,908           110,596              101,844         227,130
Other Income (Expense) - Net                              169,330            23,161             (582,443)       (146,004)
                                                         --------         ---------           ----------       ---------

Earnings (Loss) Before Income Taxes                        41,935            11,843             (810,499)       (176,827)

Provision for Income Taxes                                      0           114,000                    0         108,000
                                                         --------         ---------           ----------       ---------

Earnings (Loss) From Continuing Operations                 41,935          (102,157)            (810,499)       (284,827)

(Loss) Earnings from Discontinued Operations -
Net of Non-Owned Interests and Income Taxes               (90,899)         (236,629)           1,276,197        (347,360)
                                                         --------         ---------           ----------       ---------

Net (Loss) Earnings                                      $(48,964)        $(338,786)          $  465,698       $(632,187)
                                                         ========         =========           ==========       =========

Basic and Diluted (Loss) Earnings per Share:
  Earnings (loss) from continuing operations             $   0.03         $   (0.07)          $    (0.55)      $   (0.19)
  (Loss) earnings from discontinued operations              (0.06)            (0.16)                0.86           (0.24)
                                                         --------         ---------           ----------       ---------
    Net (loss) earnings per share                        $  (0.03)        $   (0.23)          $     0.31       $   (0.43)
                                                         ========         ==========          ==========       =========

See notes to condensed consolidated financial statements.

</TABLE>


<PAGE>


                                  CERBCO, Inc.
                      CONDENSED CONSOLIDATED BALANCE SHEET
                                December 31, 2003
                                   (unaudited)

<TABLE>
<CAPTION>
ASSETS
Current Assets:
<S>                                                                                          <C>
  Cash and cash equivalents                                                                  $16,395,436
  Marketable securities                                                                        8,063,877
  Accounts receivable - net                                                                      612,676
  Inventories                                                                                    163,203
  Prepaid and refundable taxes                                                                    14,379
  Prepaid expenses and other                                                                      64,850
                                                                                             -----------
    Total Current Assets                                                                      25,314,421
                                                                                             -----------

Property, Plant and Equipment - at cost less accumulated depreciation of
  $2,689,853                                                                                     360,464
                                                                                             -----------

Other Assets:
  Cash surrender value of SERP life insurance                                                  2,348,767
  Marketable securities                                                                        1,055,357
  Deferred income taxes - net of valuation allowance of $1,410,000                                     0
  Deposits and other                                                                              44,489
                                                                                             -----------
    Total Other Assets                                                                         3,448,613
                                                                                             -----------
        Total Assets                                                                         $29,123,498
                                                                                             ===========

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
  Accounts payable and accrued liabilities                                                   $   541,157
  Income taxes payable                                                                            10,000
                                                                                             -----------
    Total Current Liabilities                                                                    551,157


Accrued SERP liability                                                                         3,087,535
                                                                                             -----------
    Total Liabilities                                                                          3,638,692
                                                                                             -----------

Commitments and Contingencies

Non-Owned Interests in Consolidated Subsidiaries                                               5,684,000
                                                                                             -----------

Stockholders' Equity:
  Common stock, $.10 par value
    Authorized:  3,500,000 shares
   Issued and outstanding: 1,196,899 shares                                                      119,690
  Class B Common stock (convertible), $.10 par value
    Authorized:  700,000 shares
   Issued and outstanding: 291,057 shares                                                         29,105
  Additional paid-in capital                                                                   7,578,028
  Retained earnings                                                                           12,073,983
                                                                                             -----------
        Total Stockholders' Equity                                                            19,800,806
                                                                                             -----------
            Total Liabilities and Stockholders' Equity                                       $29,123,498
                                                                                             ===========

See notes to condensed consolidated financial statements.
</TABLE>


<PAGE>


                                  CERBCO, Inc.
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (unaudited)

<TABLE>
                                                                               Six Months Ended Dec. 31,
                                                                         ------------------------------------
<CAPTION>
                                                                               2003                 2002
                                                                         -----------------   -----------------

Cash Flows from Operating Activities:
<S>                                                                        <C>                   <C>
  Loss from continuing operations                                          $   (810,499)         $ (284,827)
  Earnings (loss) from discontinued operations                                1,276,197            (347,360)
                                                                           ------------          ----------
  Net earnings (loss)                                                           465,698            (632,187)
  Adjustments to reconcile net earnings (loss)
    to net cash provided by (used in) operations:
    Depreciation and amortization                                                 4,952             552,121
    Deferred income taxes                                                       895,000                   0
    Amounts attributable to non-owned interests                               1,984,697            (537,155)
    Gain on sale of equipment                                                (5,756,769)           (292,212)
    Increase in SERP liability                                                  867,831               6,672
    Changes in operating assets and liabilities:
      Decrease in accounts receivable                                         2,288,882           1,204,018
      Decrease (increase) in inventories                                        103,624             (14,856)
      Decrease in prepaid expenses                                              129,061             185,028
      Decrease in accounts payable and accrued expenses                        (925,944)           (490,559)
                                                                           ------------          ----------
  Net Cash Provided by (Used in) Operating Activities                            57,032             (19,130)
                                                                           ------------          ----------

Cash Flows from Investing Activities:
  Capital expenditures                                                                0             (33,202)
  Sale of equipment and other assets                                         11,353,716             363,242
  Redemption of marketable securities - net                                     379,973             221,659
  Increase in cash surrender value of SERP life insurance                      (325,183)            (95,297)
                                                                           ------------          ----------
  Net Cash Provided by Investing Activities                                  11,408,506             456,402
                                                                           ------------          ----------
Cash Flows from Financing Activities:
  Principal payments under capital lease obligations                                 0               (2,013)
  Proceeds from exercise of stock options                                       73,750                    0
  Dividends paid                                                              (148,296)            (148,296)
                                                                           ------------          ----------
  Net Cash Used in Financing Activities                                        (74,546)            (150,309)
                                                                           ------------          ----------

Net Increase in Cash and Cash Equivalents                                   11,390,992              286,963
Cash and Cash Equivalents at Beginning of Period                             5,004,444            5,598,382
                                                                           ------------          ----------
Cash and Cash Equivalents at End of Period                                 $16,395,436           $5,885,345
                                                                           ============          ==========
Supplemental disclosure of cash flow information:
  Income taxes refunded                                                    $    79,384           $        0

See notes to condensed consolidated financial statements.
</TABLE>



<PAGE>


                                  CERBCO, Inc.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (unaudited)

1.   Financial Information

     The condensed consolidated financial statements include the accounts of the
parent holding company,  CERBCO, Inc. ("CERBCO");  its wholly-owned  subsidiary,
CERBERONICS,   Inc.  ("CERBERONICS"),   a  Delaware  holding  company;  and  its
majority-controlled  subsidiary,  INEI Corporation  ("INEI"),  formerly known as
Insituform  East,  Incorporated  ("Insituform  East")  (together with CERBCO and
CERBERONICS,   the  "Company").   All  significant   intercompany  accounts  and
transactions have been eliminated.

     The  Condensed  Consolidated  Balance  Sheet as of December 31,  2003,  the
Condensed  Consolidated  Statements of  Operations  for the three months and six
months  ended  December  31,  2003  and  2002,  and the  Condensed  Consolidated
Statements  of Cash Flows for the six months  ended  December  31, 2003 and 2002
have been prepared by the Company  without audit.  In the opinion of management,
all adjustments (which include only normal recurring  adjustments)  necessary to
present fairly the financial  position,  results of operations and cash flows at
December 31, 2003 and for all periods presented have been made.

     These  statements have been prepared in accordance with the instructions to
Form  10-QSB and  therefore  do not  necessarily  include  all  information  and
footnotes necessary to a presentation of the financial position,  the results of
operations and the cash flows in conformity with generally  accepted  accounting
principles.  Certain information and footnote  disclosures  normally included in
financial  statements  prepared in accordance with generally accepted accounting
principles have been condensed or omitted.  It is suggested that these condensed
financial   statements  be  read  in  conjunction  with  the  audited  financial
statements  and notes thereto  included in the  Company's  annual report on Form
10-KSB for the fiscal year ended June 30,  2003.  Operating  results for interim
periods are not necessarily indicative of operating results for an entire fiscal
year.

2.   Earnings (Loss) Per Share

     Basic and diluted per share data have been computed based upon the weighted
average number of common shares  outstanding  during each period.  For the three
months and six months  ended  December  31,  2003,  weighted  average  shares of
1,483,717 and 1,483,336, respectively, were used in such computations.  Weighted
average  shares of 1,482,956 were used for the three months and six months ended
December 31, 2002.


3.   Discontinued Operations

     In September  2003,  INEI  completed the sale of  substantially  all of its
non-real estate assets and on-going  business to Insituform  Technologies,  Inc.
The purchase price of approximately $5.5 million was paid in cash to INEI at the
closing,  less a 10% escrow. INEI recognized a gain on the sale of approximately
$5.0 million.

     In December  2003,  INEI  completed the sale of all of its real property in
Landover,  MD to Bohrer's Nest, L.L.C., an affiliate of Atlantic  Transportation
Equipment,  Ltd., of Beltsville,  MD. The purchase price of  approximately  $5.1
million  was paid in cash,  less  $306,000  in  expenses  for INEI's  portion of
closing costs and an escrow amount of $225,500 pending final clean-up of certain
areas of the property.

     In May 2003, INEI entered into discussions with several parties  indicating
an interest in a possible purchase of Try Tek Machine Works, Inc. ("Try Tek"), a
wholly-owned subsidiary of INEI, or some or all of its assets. These discussions
are continuing.  Try Tek's  operations have been  significantly  curtailed since
that time.

     As of  June  30,  2003,  all of  INEI's  activities  are  considered  to be
discontinued.  The operating results of INEI for the three months and six months
ended December 31, 2003 are shown  separately in the  accompanying  Consolidated
Statement  of  Operations  as  earnings  from   discontinued   operations.   The
Consolidated  Statement of Operations  for the three months and six months ended
December  31,  2002 has been  restated  to also show  separately  the  operating
results  of INEI as a loss  from  discontinued  operations.  Sales  revenues  of
$109,281 and  $2,149,864  for the three months ended December 31, 2003 and 2002,
respectively,  and  $1,892,501  and $4,751,991 for the six months ended December
31, 2003, respectively, are included in the results from discontinued operations
and are not  shown as  sales  in the  accompanying  Consolidated  Statements  of
Operations.

4.   Marketable Securities

     Marketable securities consist of:


<TABLE>
                                                                        Dec. 31, 2003
                                                          ---------------------------------------
                                                              Amortized               Fair
<CAPTION>
                                                                Cost                  Value
                                                          ------------------   ------------------
        Current:
<S>                                                           <C>                  <C>
            U.S. Government and agencies                      $4,063,887           $4,063,430
            Corporate                                          4,000,000            4,000,000
                                                          ------------------   ------------------
        Non-current:                                          $8,063,877           $8,063,430
            U.S. Government                                    1,055,357            1,068,750
                                                          ------------------   ------------------
                  Total marketable securities                 $9,119,234           $9,132,180
                                                          ==================   ==================
</TABLE>

5.   Accounts Receivable

     Accounts receivable consist of:

<TABLE>
<CAPTION>
                                                                       Dec. 31, 2003
                                                                       -------------
<S>                                                                       <C>
        Due from customers                                                $594,082
        Miscellaneous                                                       40,517
                                                                          --------
                                                                           634,599
        Less: Allowance for doubtful accounts                              (21,923)
                                                                          --------
              Total accounts receivable                                   $612,676
                                                                          ========
</TABLE>

6.   Equity in INEI Corporation

     At September 30, 2003,  CERBCO  beneficially  held 1,414,850 shares of INEI
Common Stock, par value $0.04 per share (the "Common Stock"), and 296,141 shares
of convertible  INEI Class B Common Stock, par value $0.04 per share (the "Class
B Common Stock"), representing approximately 34.7% of the Common Stock, 99.5% of
the  Class B Common  Stock,  39.1% of the  total  equity  and 62.1% of the total
voting power of all outstanding  classes of INEI stock.  Holders of INEI Class B
Common  Stock,  voting  separately  as a  class,  have the  right  to elect  the
remaining members of the INEI Board of Directors after election of not less than
25% of such members by holders of shares of INEI Common Stock, voting separately
as a class.

     From time to time,  INEI issues  additional  shares of stock as a result of
stock  dividends  and  exercised  stock  options.  Changes in capital  structure
resulting from such additional stock issues decrease  CERBCO's equity ownership.
On December 11, 2003, INEI issued 15,000 shares of Common Stock as the result of
an exercise of stock options by a director.  If all the options  outstanding  at
December 31, 2003 were exercised,  the resulting  percentages of CERBCO's equity
ownership and total voting power would be 36.9% and 59.8%, respectively.

     From time to time, INEI purchases  shares of its common stock for treasury.
Changes in  capital  structure  resulting  from such  stock  purchases  increase
CERBCO's  equity  ownership.  INEI did not purchase any shares  during the three
months ended December 31, 2003.

     While  generally   accepted   accounting   principles  (GAAP)  require  the
consolidation  of INEI book values in the  reporting  of  CERBCO's  consolidated
assets,  the  Company  is advised  that INEI has  publicly  disclosed  that INEI
anticipates  corporate  dissolution  in due course and that the amount that INEI
presently  anticipates  ultimately to be  distributed  to  stockholders  will be
between  $1.25 and $1.75 per share of INEI Common  Stock and INEI Class B Common
Stock.  Accordingly,  if such INEI  distribution was ultimately  realized at the
mid-point of such range ($1.50),  the  recoverable  asset value of the Company's
stockholdings  in INEI would be $2,566,487  rather than the  $3,654,915 pro rata
equity value as  currently  reflected in the  Company's  consolidated  financial
statements reported under GAAP.

7.   Accounts Payable and Accrued Liabilities

     Accounts payable and accrued liabilities consist of:

                                                               Dec. 31, 2003
                                                               -------------

       Accounts payable                                          $193,560
       Accrued compensation and other expenses                    347,597
                                                                 --------
           Total accounts payable                                $541,157
                                                                 ========

8.   Contingencies

     The  Company  is  involved  in  certain  contingencies  arising  out of the
ordinary course of business,  the aggregate of which will not, in the opinion of
management,  materially  affect the Company's  financial  position or results of
operations.

9.   Supplemental Executive Retirement Plan

     On  September  24,  2003,  the  CERBCO  Board  of  Directors  preliminarily
determined  by  affirmative  resolution  that,  in due course,  CERBCO should be
orderly  liquidated  and dissolved.  Such  determination  was made,  among other
reasons,  in light of the  September  5,  2003  consummation  of the sale of the
business,  licenses  and  most  operating  assets  of  CERBCO's  sole  operating
subsidiary,  INEI, and such  subsidiary's  disclosed intent to orderly liquidate
and dissolve in due course. The current change in Company assumption from CERBCO
continuing  in  perpetuity,  to an  assumption of  nearer-term  liquidation  and
dissolution,  similarly effects a change in accounting assumptions applicable to
the Company's SERP (a non-qualified retirement plan) for its executive officers.
As it is now questionable whether the Company's executive officers will continue
employment  to the  plan's  assumed  normal  retirement  age  of 65,  accounting
assumptions  have been changed to accrue SERP liability on a present value basis
for the plan year (i.e.,  calendar year)  containing  the reporting  period with
anticipated, lump-sum, beneficiary payouts in January 2005. Based on such change
of  accounting  assumptions,  as of September  30, 2003,  and  effective for and
through  plan/calendar  year 2003,  the  Company  readjusted  the  accrued  SERP
liability  in the  accompanying  Consolidated  Balance  Sheet in the  amount  of
$796,072,  and included  this amount in other  expense-net  in the  accompanying
Consolidated Statement of Operations for the six months ended December 31, 2003.
In December 2003, two of the Company's executive officers filed a claim with the
Company  indirectly  calling into question whether the SERP liability carried on
the books of the Company  adequately  reflects  the full extent of the  benefits
believed by such officers to be due under the plan. Pending final determinations
under such claim, no provision for potential  additional SERP liability  related
thereto has been accrued by the Company.

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

Overview and Outlook

     The Company reported  consolidated  earnings from continuing  operations of
$41,935 ($0.03 per share), a consolidated loss from  discontinued  operations of
-$90,899  (-$0.06 per share) and a consolidated net loss of -$48,964 (-$0.03 per
share) for the second  quarter of fiscal year 2004 ended  December 31, 2003. For
the first six months of fiscal year 2004,  the Company  reported a  consolidated
loss from continuing  operations of -$810,499  (-$0.55 per share),  consolidated
earnings  from  discontinued  operations  of  $1,276,197  ($0.86  per share) and
consolidated  net earnings of $465,698 ($0.31 per share).  Sales of $0.1 million
and  $1.9  million  recognized  by  INEI  Corporation  ("INEI"),  the  Company's
majority-controlled and, prior to September 5, 2003, only-operating segment, for
the three months and six months  ended  December  31,  2003,  respectively,  are
included in the earnings (loss) from discontinued operations.

     The Company  attributed  its favorable  results for the first six months of
fiscal year 2004 to the  discontinued  operations of INEI.  INEI  recognized net
earnings of $3,260,894 for the six months,  primarily due to a $5.0 million gain
on the sale of  substantially  all of its business under an Asset Sale closed on
September 5, 2003 for $5.5  million.  For this current  six-month  period,  INEI
contributed  earnings from discontinued  operations of $1,276,197 (39.1%) to the
Company.

     Until  the  Asset  Sale,  INEI and its  subsidiaries  were  engaged  in the
trenchless  rehabilitation of underground  sewers and other pipelines  primarily
using  cured-in-place  pipe  ("CIPP")   rehabilitation   processes.   INEI  and,
consequently,  the Company, has not had any ongoing operations subsequent to the
Asset Sale,  other than those of Try Tek Machine  Works,  Inc.  ("Try  Tek"),  a
wholly-owned  subsidiary of INEI. Try Tek's  operations have been  significantly
curtailed since May 2003.

     In parallel with the Asset Sale,  the INEI Board of Directors has continued
to  undertake  certain  additional   transactions   designed  to  maximize  INEI
stockholder value,  including the sale of other excess equipment not included in
the Asset Sale and, in December 2003, the sale of all of INEI's real property in
Landover, MD. INEI currently anticipates that additional  transactions will take
the form of the  liquidation  of its  remaining  assets,  including  the sale or
disposition  of  the  assets  of  Try  Tek,  and  the   satisfaction  of  INEI's
liabilities, including personnel termination and related costs, sale transaction
expenses and other final liquidation costs.

     INEI held as of December 31, 2003:

          o    one parcel of improved real property located in Hanover, PA, used
               to house the business of Try Tek, which custom designs and builds
               machinery,  including  machinery used to  rehabilitate  pipelines
               using CIPP processes;

          o    cash and  cash  equivalents  in the  approximate  amount  of $8.7
               million,  substantially  all of  which  represents  residual  net
               proceeds from the sales of INEI's  property,  equipment and other
               assets;

          o    residual  inventory  and  equipment not part of the Asset Sale in
               the approximate amount of $500,000; and

          o    accounts receivable in the approximate amount of $600,000.

     On  September  24,  2003,  the  INEI  Board  of  Directors  concluded  that
dissolution of INEI,  liquidation and distribution of its assets would be in the
best interest of INEI and its stockholders. The INEI Board preliminarily adopted
a plan of  dissolution  and  liquidation  and  intends in due course to submit a
definitive  plan  and  a  final  form  of  proposed  dissolution  to a  vote  of
stockholders at the next annual meeting, currently anticipated to be held during
the quarter ending June 30, 2004.

     Likewise,  on September  24, 2003,  the Company's  Board of Directors  also
concluded that  dissolution of the Company,  liquidation and distribution of its
assets would be in the best  interest of the Company and its  stockholders.  The
CERBCO Board also  preliminarily  adopted a plan of dissolution  and liquidation
and  intends  in due  course to  submit a  definitive  plan and a final  form of
proposed  dissolution to a vote of its stockholders at the Company's next annual
meeting,  also  currently  anticipated to be held during the quarter ending June
30, 2004.

     In connection with the contemplated dissolution proposal, while the Company
at the present time is not able to predict with certainty the actual  realizable
value  of  its  remaining  assets,  the  ultimate   settlement  amounts  of  its
liabilities  or the  amounts it  actually  will  expend  during the  liquidation
process,  it currently  anticipates that the amount ultimately  distributable to
its stockholders  will be between $8.50 and $11.50 per share of Common Stock and
Class B Common Stock. To the extent that the value of its assets is less, or the
amount of its  liabilities or the amounts that it expends during the liquidation
are  greater,  than  the  Company  anticipates,  its  stockholders  may  receive
substantially less than the Company presently anticipates or nothing at all.

Results of Operations

     The  results  from  continuing  operations  are the  results  of the parent
company,  CERBCO. CERBCO's interests in INEI's discontinued operations are shown
as earnings (loss) from discontinued operations - net of non-owned interests and
income taxes.

      Three Months Ended 12/31/03 Compared with Three Months Ended 12/31/02

     CERBCO's general and administrative expenses increased approximately 34% in
the second  quarter of fiscal  year 2004 as  compared  to the second  quarter of
fiscal year 2003, primarily due to an increase in business insurance expense and
legal fees incurred in the second quarter of fiscal year 2004 in connection with
the potential  dissolution of the Company.  The Company's directors and officers
insurance premium for calendar year 2003 increased 42% over calendar year 2002.

     Investment income decreased  approximately  67%, primarily as a result in a
decline in interest  received.  INEI repaid in full an  intercompany  loan of $3
million from the Company on September 5, 2003. Other income-net  increased 631%,
primarily due to increases in the cash  surrender  values of insurance  policies
funding the Company's supplemental retirement plan (SERP).

     The  loss  from  discontinued  operations-net  decreased  from  a  loss  of
-$236,629 in the second quarter of fiscal year 2003 to a loss of -$90,899 in the
second   quarter  of  fiscal  year  2004  primarily  due  to  the  cessation  of
substantially  all of  INEI's  operations  on  September  5,  2003.  The  parent
company's interest in INEI's discontinued operations is 39.1%.

        Six Months Ended 12/31/03 Compared with Six Months Ended 12/31/02

     CERBCO's general and administrative expenses increased approximately 28% in
the first six months of fiscal  year 2004 as compared to the first six months of
fiscal year 2003,  primarily due to increases in business insurance expense, and
legal and  consulting  fees incurred in the first six months of fiscal year 2004
in  connection  with the  potential  dissolution  of the Company.  The Company's
directors and officers  insurance  premium for calendar year 2003  increased 42%
over calendar 2002.

     Investment income decreased  approximately  55%, primarily as a result of a
decline in interest  received.  INEI repaid in full an  intercompany  loan of $3
million from the Company on September 5, 2003. Other expense-net increased 299%,
primarily due to the  recognition  of an adjustment at September 30, 2003 to the
Company's  accrued SERP liability to reflect a change in accounting  assumptions
to accrue such  liability  on a present  value basis with  anticipated  lump-sum
beneficiary payouts in January 2005. Such expense in fiscal year 2004 was offset
to some extent by increases in the cash surrender  values of insurance  policies
funding the Company's SERP.

     Earnings (loss) from discontinued  operations -net increased from a loss of
-$347,360 in the first six months of fiscal year 2003 to earnings of  $1,276,197
in the first six months of fiscal year 2004, primarily due to the recognition by
INEI of a gain of  approximately  $5.0  million on the sale of its  business  on
September  5,  2003.  The parent  Company's  interest  in the  results of INEI's
discontinued operations is 39.1%.

Financial Condition

     During the six months  ended  December 31, 2003,  the  Company's  operating
activities  provided  $57,032 in cash. The Company's net earnings were offset by
the net effect of (i) items that did not affect the  Company's  operating  cash,
including an $895,000  decrease in deferred tax assets,  $1,984,697  in earnings
attributable to non-owned interests, a $5,756,769 gain on the sale of assets and
an $867,831 increase in the Company's  accrued SERP liability,  and (ii) changes
in items that did affect the Company's cash,  including a $2,288,882 decrease in
accounts  receivable,  as  customer  accounts  were  collected,  and an $925,944
decrease  in  accounts  payable  as vendors  were paid,  both as a result of the
winding down of the Company's operations during the period.

     The Company's  investing  activities  provided  $11,408,506  during the six
months ended  December 31, 2003,  primarily  due to the sale of INEI's assets on
September 5, 2003.  The Company used $74,546 in its financing  activities due to
the payment of dividends by the parent company, CERBCO.

     The  Company's   liquidity   remained   strong  with  working   capital  of
approximately $24.8 million and a current ratio of 46 to 1 at December 31, 2003.
The Company has cash and  temporary  investments  in  marketable  securities  of
approximately  $25.5 million which it believes is more than adequate to meet its
cash flow requirements in the foreseeable future.

Forward-Looking Information

     This  report  contains  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. Forward-looking statements that are
based  on  certain  assumptions  and  describe  future  plans,  strategies,  and
expectations  of the  Company  are  generally  identifiable  by use of the words
"believe," "expect," "intend,"  "anticipate,"  "estimate,"  "project" or similar
expressions.  Forward-looking statements such as these involve known and unknown
risks,  uncertainties and other important factors that could cause the Company's
actual  results,  performance  or  achievements,   or  other  subjects  of  such
statements,  to differ materially from the Company's expectations regarding such
matters expressed or implied by such forward-looking  statements.  The Company's
ability to predict results or the actual effect of future plans or strategies is
inherently  uncertain.  Although  the  Company  believes  that the  expectations
reflected in its forward-looking  statements contained herein are reasonable, it
cannot  guarantee  future  events or results.  Except as may be  required  under
federal  law,  the Company  undertakes  no  obligation  to update  publicly  any
forward-looking  statements  for any  reason,  even if new  information  becomes
available or other events occur.

Item 3.  Controls and Procedures

     As of December 31, 2003, an evaluation was performed  under the supervision
and with the participation of the Company's management,  including the Company's
Corporate Executive Committee ("CEC"), which performs as a functional equivalent
of a CEO,  and CFO,  of the  effectiveness  of the design and  operation  of the
Company's  disclosure controls and procedures (as defined in Rules 13a-14(c) and
15d-14(c) under the Securities Exchange Act of 1934 (the "Exchange Act")). Based
on that  evaluation,  the  Company's  management,  including  the  CEC and  CFO,
concluded that the Company's  disclosure  controls and procedures were effective
as of December 31, 2003. There have been no significant changes in the Company's
internal controls or in other factors that could  significantly  affect internal
controls subsequent to December 31, 2003.

     Disclosure controls and procedures generally are the Company's controls and
other  procedures  that are designed to ensure that  information  required to be
disclosed  by the  Company in the  reports  that it files or  submits  under the
Exchange Act is recorded,  processed,  summarized and reported,  within the time
periods specified in the Securities and Exchange  Commission's  rules and forms.
Disclosure  controls and procedures include,  without  limitation,  controls and
procedures  designed to ensure that information  required to be disclosed by the
Company in the reports that it files under the Exchange Act is  accumulated  and
communicated  to the Company's  management,  including  its principal  executive
officers  and  principal  financial  officer,  as  appropriate  to allow  timely
decisions regarding required disclosure.

     In designing, implementing and evaluating the Company's disclosure controls
and  procedures,  the  Company's  management  recognizes  that any  controls and
procedures, no matter how well designed and implemented, may not be effective in
all circumstances.  However,  management believes that the Company's  disclosure
controls and procedures  provide  reasonable  assurance of achieving the desired
disclosure control objectives.



<TABLE>
                           PART II - OTHER INFORMATION

Item 6.  Exhibits and Reports on Form 8-K

<CAPTION>
(a) Exhibits:                                                                                           Pages

<S>       <C>                                       <C>                               <C>                 <C>
          31.1   Certification  pursuant to Section 302 of the  Sarbanes-Oxley Act of 2002                13

          31.2   Certification  pursuant to Section 302 of the  Sarbanes-Oxley Act of 2002                14

          31.3   Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                  15

          32     Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                  16

          99     CERBCO,  Inc.  Consolidating  Schedules:  Statement of Operations  Information
                 for the three months and six months ended  December  31, 2003;  Balance  Sheet
                 Information; and Consolidating Elimination Entries as of December 31, 2003              17-21
</TABLE>

(b)  Reports on Form 8-K:

     The Company filed two reports on Form 8-K during the quarter ended December
31,  2003.  The first  report,  dated  November  14,  2003,  did not include any
financial  statements  and reported  under Item 5. Other  Events:  Issuance of a
press release dated November 14, 2003 announcing the Company's financial results
for the three months ended September 30, 2003.

     The second  report,  dated December 16, 2003, did not include any financial
statements and reported under Item 5. Other Events:  Issuance of a press release
dated December 16, 2003 announcing the Company would not hold its annual meeting
of stockholders for the fiscal year ended June 30, 2003 until the quarter ending
June 30, 2004.


                                   SIGNATURES

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

Date: February 17, 2004

                                CERBCO, Inc.
                                ------------------------------------------------
                                (Registrant)



                                /s/ ROBERT W. ERIKSON
                                ------------------------------------------------
                                Robert W. Erikson
                                President



                                /s/ ROBERT F. HARTMAN
                                ------------------------------------------------
                                Robert F. Hartman
                                Vice President, Secretary & Treasurer
                                (Principal Financial and Accounting Officer)