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

                                   FORM 10-QSB

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

For the quarterly period ended:                                  March 31, 2002
                                       OR


[      ]   TRANSITION REPORT PURSUANT TO 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 registrant 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
(Address of principal executive offices)                       (Zip Code)


Registrant's telephone and fax numbers, including area code:
                      301-773-1784 (tel)
                      301-322-3041 (fax)
                      301-773-4560 (24-hour public information FaxVault System)

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
                                --------     --------

As of May 9, 2002, the following number of shares of each of the issuer's
classes of common stock were outstanding:
                    Common Stock            1,189,538
                    Class B Common Stock      293,418
                                            ---------
                    Total                   1,482,956



                                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 the Nine Months Ended
              March 31, 2002 and March 31, 2001 (unaudited).....................................................  3

              Condensed Consolidated Balance Sheets as of March 31, 2002 and June 30, 2001 (unaudited)..........  4

              Condensed Consolidated Statements of Cash Flows for the Nine Months Ended March 31, 2002 and
              March 31, 2001 (unaudited)........................................................................  5

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

Item 2.       Management's Discussion and Analysis of Financial Condition and Results of Operations.............  9

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

Item 1.       Legal Proceedings.................................................................................  12

Item 2.       Changes in Securities and Use of Proceeds.........................................................  12

Item 3.       Defaults upon Senior Securities...................................................................  12

Item 4.       Submission of Matters to a Vote of Security Holders...............................................  12

Item 5.       Other Information.................................................................................  12

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


                         PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

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

<TABLE>
<CAPTION>
                                                      For the three months ended            For the nine months ended
                                                               March 31                              March 31
                                                   ---------------------------------    ----------------------------------
                                                       2002               2001               2002               2001
                                                   --------------    ---------------    ---------------     --------------

<S>                                                <C>               <C>                <C>                   <C>
Sales                                              $4,883,746        $6,289,934         $14,933,629           $18,427,517
                                                   --------------    ---------------    ---------------     --------------
Costs and Expenses:
  Cost of sales                                       4,233,120         5,860,096          13,553,989          16,213,995
  Selling, general and administrative expenses        1,603,606         1,464,707           3,604,433           3,785,727
                                                   --------------    ---------------    ---------------     --------------
    Total Costs and Expenses                          5,836,726         7,324,803          17,158,422          19,999,722
                                                   --------------    ---------------    ---------------     --------------

Operating Loss                                         (952,980)       (1,034,869)         (2,224,793)         (1,572,205)
Investment Income                                       110,314           220,211             408,101             721,123
Interest Expense                                         (1,018)           (3,972)             (4,560)            (12,520)
Other Expense - net                                     (60,266)         (212,283)           (145,268)           (599,840)
                                                   --------------    ---------------    ---------------     --------------
Loss Before Non-Owned Interests in Insituform
  East, Inc. and Income Taxes                          (903,950)       (1,030,913)         (1,966,520)         (1,463,442)
(Credit) Provision  for Income Taxes                   (901,500)          (23,000)           (871,500)             62,000
                                                   --------------    ---------------    ---------------     --------------
Loss Before Non-Owned Interests in Insituform
  East, Inc.                                             (2,450)       (1,007,913)         (1,095,020)         (1,525,442)
Non-Owned Interests in (Earnings) Loss of
  Insituform East, Inc.                                (290,960)          394,483             341,707             511,234
                                                    --------------   ---------------    ---------------     --------------
                                         NET LOSS   $  (293,410)      $  (613,430)        $  (753,313)        $(1,014,208)
                                                   ==============    ===============    ===============     ==============

Net Loss per Share of Common Stock:
    Basic Loss per Share                            $     (0.20)      $     (0.41)        $     (0.51)        $     (0.68)
    Diluted Loss per Share                          $     (0.20)      $     (0.41)        $     (0.51)        $     (0.68)
</TABLE>


See notes to condensed consolidated financial statements.

<PAGE>


<TABLE>
                                  CERBCO, Inc.
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                   (unaudited)
                                                                                                          As of
                                                                                           --------------------------------------
<CAPTION>
                                                                                            March 31, 2002         June 30, 2001
                                                                                           ------------------    ----------------
ASSETS
Current Assets:
<S>                                                                                         <C>                   <C>
   Cash and cash equivalents                                                                $  3,551,595          $  1,735,972
   Marketable securities                                                                       7,700,983             7,995,843
   Accounts receivable                                                                         6,536,226             6,983,481
   Inventories                                                                                 1,056,128             1,102,521
   Prepaid and refundable taxes                                                                  951,918                80,418
   Prepaid expenses and other                                                                    214,419               289,217
                                                                                           ------------------    ----------------
     Total Current Assets                                                                     20,011,269            18,187,452
                                                                                           ------------------    ----------------

Property, Plant and Equipment - at cost less accumulated depreciation of $17,471,900 at
   March 31, 2002 and $16,922,043 at June 30, 2001                                             7,501,166             8,516,639
                                                                                           ------------------    ----------------

Other Assets:
   Excess of acquisition cost over value of net assets acquired less accumulated
     amortization of $1,437,803 at March 31, 2002 and $1,388,825 at June 30, 2001              1,501,986             1,550,964
   Cash surrender value of SERP life insurance                                                 2,063,884             2,000,107
   Marketable securities                                                                       1,014,518             3,582,029
   Deferred income taxes - net of valuation allowance of $1,661,000 at March 31, 2002
     and $1,858,000 at June 30, 2001                                                                   0                     0
   Deposits and other                                                                             44,489                53,156
                                                                                           ------------------    ----------------
     Total Other Assets                                                                        4,624,877             7,186,256
                                                                                           ------------------    ----------------
         Total Assets                                                                      $  32,137,312         $  33,890,347
                                                                                           ==================    ================

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
  Accounts payable and accrued liabilities                                                  $  2,041,910          $  2,991,939
  Income taxes payable                                                                            10,000                10,000
  Current portion of capital lease obligations                                                     5,480                32,448
                                                                                           ------------------    ----------------
     Total Current Liabilities                                                                 2,057,390             3,034,387
                                                                                           ------------------    ----------------

Long-Term Liabilities:
  Accrued SERP liability                                                                       1,861,716             1,532,851
  Capital lease obligations (less current portion shown above)                                       264                10,147
                                                                                           ------------------    ----------------
     Total Long-term Liabilities                                                               1,861,980             1,542,998
                                                                                           ------------------    ----------------
         Total Liabilities                                                                     3,919,370             4,577,385
                                                                                           ------------------    ----------------

Commitments and Contingencies

Non-Owned Interests in Consolidated Subsidiaries                                               5,233,193             5,574,900
                                                                                           ------------------    ----------------

Stockholders' Equity:
  Common stock, $.10 par value
     Authorized:  3,500,000 shares
     Issued and outstanding: 1,189,538 shares (at March 31, 2002)                                118,953
     Issued and outstanding:  1,189,476 shares (at June 30, 2001)                                                      118,947
  Class B Common stock (convertible), $.10 par value
     Authorized:  700,000 shares
     Issued and outstanding: 293,418 shares (at March 31, 2002)                                   29,342
     Issued and outstanding: 293,480 shares (at June 30, 2001)                                                          29,348
  Additional paid-in capital                                                                   7,527,278             7,527,278
  Retained earnings                                                                           15,309,176            16,062,489
                                                                                           ------------------    ----------------
     Total Stockholders' Equity                                                               22,984,749            23,738,062
                                                                                           ------------------    ----------------
         Total Liabilities and Stockholders' Equity                                        $  32,137,312         $  33,890,347
                                                                                           ==================    ================
</TABLE>

See notes to condensed consolidated financial statements.



<PAGE>


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

<CAPTION>
                                                                           For the nine months ended March 31
                                                                           ---------------------------------------
                                                                                 2002                  2001
                                                                           -----------------     -----------------

Cash Flows from Operating Activities:
<S>                                                                          <C>                   <C>
  Net loss                                                                   $  (753,313)          $(1,014,208)
  Adjustments to reconcile net loss to net cash
    used in operations:
    Depreciation and amortization                                              1,179,505             1,562,586
    Amounts attributable to non-owned interests                                 (341,707)             (511,234)
    Gain on sale of equipment                                                    (48,857)                    0
    Increase in accrued SERP liability                                           328,865               394,189
    Changes in operating assets and liabilities:
      Decrease (increase) in accounts receivable                                 447,255            (1,602,986)
      Decrease in inventories                                                     46,393               278,289
      Increase in prepaid expenses and other current assets                     (796,702)             (137,336)
      Decrease in accounts payable and accrued expenses                         (801,733)             (195,250)
      Decrease in income taxes payable                                                 0              (148,000)
                                                                           -----------------     -----------------
Net Cash Used in Operating Activities                                           (740,294)           (1,373,950)
                                                                           -----------------     -----------------

Cash Flows from Investing Activities:
  Capital expenditures                                                          (122,837)             (253,850)
  Sale of equipment                                                               65,307                68,762
  Redemption of marketable securities - net                                    2,862,371               517,657
  Increase in investment in Insituform East                                            0                (2,930)
  (Increase) decrease in cash surrender value of life insurance                  (63,777)              557,231
                                                                           -----------------     -----------------
Net Cash Provided by Investing Activities                                      2,741,064               886,870
                                                                           -----------------     -----------------

Cash Flows from Financing Activities:
  Principal payments on capital lease obligations                                (36,851)              (22,009)
  Dividends paid                                                                (148,296)             (148,296)
                                                                           -----------------     -----------------
  Net Cash Used in Financing Activities                                         (185,147)             (170,305)
                                                                           -----------------     -----------------

Net Increase (decrease) in Cash and Cash Equivalents                           1,815,623              (657,385)
Cash and Cash Equivalents at Beginning of Period                               1,735,972             2,344,077
                                                                           -----------------     -----------------
Cash and Cash Equivalents at End of Period                                  $  3,551,595          $  1,686,692
                                                                           =================     =================

Supplemental Disclosure of Cash Flow Information:
  Interest paid                                                             $         4,560       $      21,761
  Income taxes paid                                                         $             0       $     330,000


</TABLE>

See notes to condensed consolidated financial statements.



<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");  and its  majority-controlled
subsidiary,  Insituform  East,  Incorporated  ("Insituform  East," together with
CERBCO, the "Company").  All significant  intercompany accounts and transactions
have been eliminated.

     The  Condensed  Consolidated  Balance  Sheet  as of  March  31,  2002,  the
Condensed  Consolidated  Statements of Operations  for the three months and nine
months ended March 31, 2002 and 2001, and the Condensed Consolidated  Statements
of Cash  Flows  for the nine  months  ended  March  31,  2002 and 2001 have been
prepared by the Company without audit. The Condensed  Consolidated Balance Sheet
as of June 30, 2001  (unaudited)  has been derived from the  Company's  June 30,
2001 audited financial statements. 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 March 31, 2002
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  accounting  principles
generally  accepted in the United  States of America.  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 CERBCO annual report on Form 10-KSB for the fiscal year ended June 30, 2001.
Operating  results  for  interim  periods  are  not  necessarily  indicative  of
operating results for an entire fiscal year.

2.   Earnings (Loss) Per Share

     Basic  earnings  (loss) per share data are computed based upon the weighted
average number of common shares outstanding during each period. Diluted earnings
(loss) per share data are  computed  based upon the weighted  average  number of
common shares  outstanding  during the period including common stock equivalents
from  dilutive  stock  options,  if any. The weighted  average  number of common
shares outstanding used in computing diluted loss per share for the three months
and nine months ended March 31, 2002 and 2001  include no net shares  associated
with unexercised  dilutive stock options.  The following  numbers of shares have
been used in the loss per share computations:

<TABLE>
                                                       For the three months and nine months ended March 31
                                                   --------------------------------------------------------------
<CAPTION>
                                                              2002                               2001
                                                   ---------------------------         --------------------------

<S>                                                        <C>                                 <C>
                  Basic                                    1,482,956                           1,482,956
                                                   ===========================         ==========================
                  Diluted                                  1,482,956                           1,482,956
                                                   ===========================         ==========================
</TABLE>

3.   Marketable Securities

     Marketable securities consist of:
<TABLE>
                                                          March 31, 2002                        June 30, 2001
                                             -------------------------------------    ---------------------------------
<CAPTION>
                                                Amortized              Fair             Amortized            Fair
                                                  Cost                Value               Cost               Value
                                             ----------------    -----------------    --------------     --------------
        Current:
<S>                                            <C>                 <C>                 <C>                <C>
            U.S. Government and agencies       $ 4,947,337         $ 4,971,168         $ 6,495,213        $ 6,546,031
            Corporate                            2,753,646           2,762,616           1,500,630          1,504,102
                                             ----------------    -----------------    --------------     --------------
                                                 7,700,983           7,733,784           7,995,843          8,050,133
                                             ----------------    -----------------    --------------     --------------
        Non-current:
            U.S. Government and agencies         1,014,518           1,019,940           2,270,179          2,277,260
            Corporate                                    0                   0           1,311,850          1,323,338
                                             ----------------    -----------------    --------------     --------------
                                                 1,014,518           1,019,940           3,582,029          3,600,598
                                                                 -----------------                       --------------
                                             ----------------                         --------------
                Total marketable securities    $ 8,715,501         $ 8,753,724         $11,577,872        $11,650,731
                                             ================    =================    ==============     ==============
</TABLE>


4.   Accounts Receivable

     Accounts receivable consist of:

<TABLE>
<CAPTION>
                                                       March 31, 2002          June 30, 2001
                                                      ----------------       -----------------

<S>                                                      <C>                    <C>
        Due from customers                               $6,335,925             $6,689,864
        Miscellaneous                                       200,301                293,617
                                                      -----------------      -----------------
                                                          6,536,226              6,983,481
        Less: Allowance for doubtful accounts                     0                      0
                                                      -----------------      -----------------
                                                         $6,536,226             $6,983,481
                                                      =================      =================
</TABLE>


5.   Equity in Insituform East

     At March 31, 2002, CERBCO  beneficially held 1,414,850 shares of Insituform
East Common Stock, par value $0.04 per share (the "Common  Stock"),  and 296,141
shares of convertible  Insituform East Class B Common Stock, par value $0.04 per
share (the  "Class B Common  Stock"),  representing  approximately  34.9% of the
Common Stock,  99.5% of the Class B Common Stock,  39.3% of the total equity and
62.2% of the total voting power of all  outstanding  classes of Insituform  East
common  stock.  Holders of Class B Common Stock,  voting  separately as a class,
have the right to elect the  remaining  members of the Board of Directors  after
election  of not less than 25% of such  members  by  holders of shares of Common
Stock, voting separately as a class.

     From time to time,  Insituform East 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.  No additional  shares were issued in the three months or nine months
ended  March 31,  2002.  If all the options  outstanding  at March 31, 2002 were
exercised,  the resulting  percentages  of CERBCO's  equity  ownership and total
voting power would be 34.9% and 57.8%, respectively.

     From time to time, Insituform East purchases shares of its common stock for
treasury.  Changes  in capital  structure  resulting  from such stock  purchases
increase CERBCO's equity ownership.  Insituform East did not purchase any shares
during the three months and nine months ended March 31, 2002.

6.   Accounts Payable and Accrued Liabilities

     Accounts payable and accrued liabilities consist of:

<TABLE>
<CAPTION>
                                                       March 31, 2002         June 30, 2001
                                                      ------------------     -----------------

<S>                                                      <C>                   <C>
       Accounts payable                                  $1,327,635            $1,685,392
       Accrued compensation and other expenses              714,275             1,158,251
       Dividends payable                                          0               148,296
                                                      ------------------     -----------------
                                                         $2,041,910            $2,991,939
                                                      ==================     =================
</TABLE>


7.   Contingencies

     Dispute with ITI - United States District Court for the Middle District
     -----------------------------------------------------------------------
     of Tennessee
     ------------

     As previously reported, on December 3, 1999, Insituform Technologies,  Inc.
and its  Netherlands  affiliate  (collectively,  "ITI") filed suit in the United
States  District Court for the Middle District of Tennessee  against  Insituform
East and its subsidiary Midsouth Partners.  In its Amended Complaint,  which was
filed on June 13,  2000,  ITI alleged  that  Midsouth  Partners  has  violated a
Settlement Agreement entered into in July 1999 (the "Settlement Agreement") with
respect to certain  litigation  initiated  earlier in 1999 by allegedly using or
failing to timely remove from certain  materials and equipment the Insituform(R)
trademark.  ITI claimed that these alleged breaches of the Settlement  Agreement
also  constitute  violations of the Lanham Act and the Tennessee Model Trademark
Act. In August 2001, ITI filed a Supplemental  Amended  Complaint  alleging that
Midsouth  Partners  is  insolvent  and  that  this is a  further  breach  of the
Settlement Agreement.


     ITI sought  declarations  (i) that  Midsouth  Partners has committed one or
more  noncurable  breaches  of the  Settlement  Agreement;  (ii)  that  Midsouth
Partners has  violated the Lanham Act and the  Tennessee  Model  Trademark  Act;
(iii) that  Midsouth  Partners is no longer  entitled to exploit the  technology
available  to it under its former  Insituform  sub-license,  to use certain tube
labeled  with the name  "Insituform,"  and to  continue  buying tube from ITI as
provided in the Settlement  Agreement;  (iv) that the Settlement Agreement is or
can be terminated; (v) that the right of Insituform East and its subsidiaries to
perform  certain   subcontract  work  for  Midsouth  Partners  pursuant  to  the
Settlement  Agreement is or can be terminated  and that the other  provisions of
the  Settlement  Agreement  remain in full force and  effect;  and (vi) that the
various license  agreements  between Insituform East and ITI bar Insituform East
from  exploiting the Insituform  process,  using the  Insituform  trademark,  or
practicing any  cured-in-place  pipe ("CIPP")  techniques  outside of Insituform
East's  territories  without payment of the appropriate  cross-over  royalty and
regular  royalty  totaling 20% (except as otherwise  provided by the  Settlement
Agreement)  and that these  restrictions  extend to  Midsouth  Partners as well,
because  Midsouth  Partners and Insituform  East are allegedly alter egos of one
another.  In addition to declaratory and injunctive  relief,  ITI also sought to
recover more than a million  dollars in royalties and crossover  royalties under
its alter ego and "holdover licensee" theories.

     ITI also  sought  declarations  (i)  that  Insituform  East's  Sub-Licenses
require the payment of cross-over  royalties should  Insituform East install the
Insituform process outside of its exclusive  territories and (ii) that ITI is no
longer  obligated to make payments to  Insituform  East under its August 4, 1980
agreement with Insituform East's  predecessor-in-interest (the "SAW Agreement"),
under  which ITI agreed to pay  Insituform  East's  predecessor-in-interest  for
recruiting  potential licensees of the Insituform Process.  ITI alleged that its
acquisition or merger of several such licensees has extinguished its obligations
under the SAW Agreement to pay Insituform  East, which was assigned the right to
receive payments for such licensees in April 1981.

     On April 24, 2002, the Court,  having conducted a four-day trial,  issued a
ruling  confirming the ability of Midsouth  Partners to offer its  MSP-Liner(TM)
brand  of  cured-in-place  pipe  rehabilitation  process  and  products  without
geographic  restriction or royalty  obligations to ITI. The Court rejected ITI's
claim that Midsouth  Partners'  operations are limited to the territory in which
it formerly  enjoyed  exclusive CIPP rights as an Insituform  Sub-Licensee.  The
Court likewise  rejected ITI's claim that Midsouth Partners is restricted by the
Insituform  Sub-Licenses  currently held by Midsouth  Partners'  parent company,
Insituform East. The Court thus vindicated  Midsouth Partners' position that the
termination of its Insituform  Sub-License  left it free to offer competing CIPP
products substantially without geographic or product restriction.

     The Court also rejected ITI's claim that Midsouth Partners has breached the
Settlement Agreement whereunder ITI granted to Midsouth Partners a royalty-free,
non-exclusive  right,  without  limit in time to continue to utilize  within its
former  exclusive  territory  the  cured-in-place  processes,   techniques,  and
inventions that it formerly  practiced  pursuant to its Insituform  Sub-License.
The Court similarly  rejected ITI's claims that Midsouth Partners and Insituform
East have  violated  the Patent Act,  the Lanham Act,  and the  Tennessee  Model
Trademark Act.

     The  Court  issued a  declaratory  judgment  confirming  Insituform  East's
obligation  to pay  crossover  royalties  for CIPP  work  that  Insituform  East
performs outside of its exclusive territories,  as well as ITI's relief from any
continuing obligation to Insituform East under the SAW Agreement.

     The  parties  have until May 24,  2002 to notice an appeal  from any of the
Court's rulings.

Summary and Other

     Management believes ultimate resolution of the matters discussed above will
not have a material effect on the financial  statements of CERBCO.  Accordingly,
no provision for these contingencies has been reflected therein.  The Company is
also  involved  in other  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.



<PAGE>


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

Overview and Outlook

     The  Company  reported a  consolidated  net loss of  -$293,410  (-$0.20 per
share) on sales of $4.9 million for the third quarter,  and a  consolidated  net
loss of  -$753,313  (-$0.51  per share) on sales of $14.9  million  for the nine
months ended March 31, 2002.  For the  comparative  periods of fiscal year 2001,
the Company reported a consolidated net loss of -$613,430  (-$0.41 per share) on
sales of $6.3 million,  and a consolidated  net loss of -$1,014,208  (-$0.68 per
share) on sales of $18.4 million, respectively.

     The Company attributed its unfavorable third quarter results to an increase
in  legal  and  consulting   fees  incurred  in  connection  with  the  proposed
recapitalization  of the parent company  considered for adoption by stockholders
at the Company's  annual meeting for fiscal year 2001, which was held on May 14,
2002. The parent company's losses in the third quarter were offset, to a degree,
by the positive  third quarter  results of Insituform  East,  Inc.  ("Insituform
East"), the Company's majority-controlled and only operating segment. Insituform
East recognized  consolidated net earnings of $479,113 on sales of $4.9 million,
contributing  earnings of $188,153 to CERBCO in the third quarter of fiscal year
2002.  Insituform  East  attributed  its positive third quarter fiscal year 2002
results  primarily to the favorable  impact of a $683,000  credit  provision for
income  taxes  resulting  from  tax  legislation   enacted  during  the  quarter
permitting  Insituform  East to carry back tax losses incurred during the fiscal
year ended June 30, 2001 against  taxable  income  recognized  during the fiscal
year ended June 30, 1996.  Previous tax law permitted only a two-year carry-back
period  for  fiscal  year  2001  tax  losses.  Insituform  East  also  benefited
operationally  from a consistent  volume of immediately  workable backlog in its
licensed  Insituform(R)  process territories and a focused reduction in activity
and  associated  costs in the southeast  region of the United  States,  a region
generally served by its Midsouth Partners subsidiary.

     The  recapitalization  proposal was a proposed  transaction in which CERBCO
would  merge with  CERBCO  Recapitalization  Subsidiary,  Inc.,  a wholly  owned
subsidiary of CERBCO newly formed for the purpose of facilitating the merger and
the recapitalization. In connection with the merger, each CERBCO stockholder was
to elect to receive a number of shares of new Common Stock or new Class B Common
Stock equal to the number of shares he, she or it held  before the merger,  plus
either  additional  shares of new Common  Stock or new Class B Common Stock or a
cash payment.

     As  forward-looking  information,  the Company  anticipates  a  significant
reduction in immediately workable backlog during the closing month of the fourth
quarter of fiscal year 2002 with this  condition  extending for some months into
fiscal year 2003.  Insituform  East was not the low bidder on renewal  work with
its  largest   Insituform(R)  product  customer,  a  county  government  in  the
Washington,  DC metropolitan area, and the county is anticipated to take several
months into the Company's fiscal year 2003 to determine if contracts  awarded to
lower  bidders  are able to be  performed  pursuant  to  stringent  solicitation
performance  criteria specifying a production  measurement standard on a monthly
basis.  Additionally,  the Company  believes that prevailing price levels in the
southeast region of the United States reflect a current  oversupply of capacity.
To adjust for these current and forward anticipated adverse business conditions,
the  Company  has both  undertaken  an  indefinite  suspension  of its  Midsouth
Partners  subsidiary  operations  and  initiated an  aggressive  cost  reduction
program  in  its  licensed  Insituform  process  territories.  Income  from  the
Company's  non-operating  activities  presently  is  anticipated  to continue to
approximate the normal levels of its holding  company  expenses into the future;
accordingly, absent unusual items or circumstance, such as costs associated with
the current proposed  recapitalization,  the Company's  forward-looking  results
typically are anticipated to  substantially  parallel  CERBCO's  approximate 39%
participation in the forward results of Insituform East.

     Insituform  East's total backlog value of all  uncompleted  and  multi-year
contract awards was approximately $14.8 million at March 31, 2002 as compared to
$21.6 million at March 31, 2001. The twelve-month  backlog at March 31, 2002 was
approximately  $8.9 million as compared to $14.0 million at March 31, 2001.  The
total backlog value of all  uncompleted  and  multi-year  contracts at March 31,
2002 and  2001includes  work not estimated to be released and  installed  within
twelve months,  as well as potential work included in term contract awards which
may or may not be  fully  ordered  by  contract  expiration.  While  potentially
helpful  as a possible  trend  indicator,  "total"  and  "twelve-month"  backlog
figures at specific dates are not  necessarily  indicative of sales and earnings
for future  periods due to the  irregular  timing and  receipt of major  project
awards,  including large,  multi-year,  menu-priced contracts with estimated but
uncertain order  quantities  further subject to the specifics of individual work
releases.  On a week-to-week and month-to-month basis, the availability of often
volatile "immediately workable" backlog most directly affects productivity, with
such   availability   subject  to   unpredictable   changes   such  as  weather,
customer-initiated delays and found variances in site conditions.

     In addition to Insituform  East's  immediately  workable  backlog,  another
significant  factor  affecting  the  Company's  future  performance  remains the
volatility of Insituform East's earnings as a function of sales volume at normal
margins.  Accordingly,  because a substantial portion of Insituform East's costs
are  semi-fixed in nature,  its earnings can, at times,  be severely  reduced or
eliminated  during  periods of  depressed  sales at normal  margins or  material
increases in  discounted  sales,  even where total  revenues may  experience  an
apparent  buoyancy or growth from the addition of  discounted  sales  undertaken
from  time to  time  for  strategic  reasons.  Conversely,  at  normal  margins,
increases in Insituform East's period sales typically leverage positive earnings
significantly.

     As previously  reported,  Insituform East's Insituform process licensor and
former partner in the Midsouth Partners  partnership,  Insituform  Technologies,
Inc. ("ITI"),  initiated a second calendar year 1999 lawsuit against  Insituform
East and  Midsouth  Partners on December  3, 1999,  following  the July 20, 1999
settlement (the Midsouth Settlement Agreement) of earlier litigation filed March
11,  1999.  On April 24, 2002,  the Court,  having  conducted a four-day  trial,
issued a ruling  confirming  the  ability  of  Midsouth  Partners  to offer  its
MSP-Liner(TM) brand of cured-in-place  pipe rehabilitation  process and products
without geographic restriction or royalty obligations to ITI. The Court rejected
ITI's claim that Midsouth  Partners'  operations are limited to the territory in
which it formerly enjoyed  exclusive CIPP rights as an Insituform  Sub-Licensee.
The Court likewise  rejected ITI's claim that Midsouth Partners is restricted by
the Insituform Sub-Licenses currently held by Midsouth Partners' parent company,
Insituform East. The Court thus vindicated  Midsouth Partners' position that the
termination of its Insituform  Sub-License  left it free to offer competing CIPP
products substantially without geographic or product restriction. The Court also
rejected  ITI's  claim  that  Midsouth  Partners  has  breached  the  Settlement
Agreement   whereunder  ITI  granted  to  Midsouth   Partners  a   royalty-free,
non-exclusive  right,  without  limit in time to continue to utilize  within its
former  exclusive  territory  the  cured-in-place  processes,   techniques,  and
inventions that it formerly  practiced  pursuant to its Insituform  Sub-License.
The Court similarly  rejected ITI's claims that Midsouth Partners and Insituform
East have  violated  the Patent Act,  the Lanham Act,  and the  Tennessee  Model
Trademark  Act. The Court issued a declaratory  judgment  confirming  Insituform
East's obligation to pay crossover  royalties for CIPP work that Insituform East
performs outside of its exclusive territories,  as well as ITI's relief from any
continuing obligation to Insituform East under the SAW Agreement with respect to
former Insituform process licensees.

Results of Operations

       Three Months Ended 3/31/02 Compared with Three Months Ended 3/31/01

     Consolidated  sales decreased $1.4 million (-22%) from $6.3 million for the
quarter  ended  March 31, 2001 to $4.9  million for the quarter  ended March 31,
2002, due primarily to reduced  comparable  period sales in the southeast region
of the United States.

     The  consolidated  operating  loss  decreased 8% from  -$1,034,869  for the
quarter  ended March 31, 2001 to -$952,980 for the quarter ended March 31, 2002.
Consolidated  cost of sales  decreased  28% in the third  quarter of fiscal year
2002 as compared to the third  quarter of fiscal year 2001.  As a result,  gross
profit as a  percentage  of sales  increased  from a gross  profit of 7% for the
third quarter of fiscal year 2001 to a gross profit of 13% for the third quarter
of fiscal year 2002.  This  increase is due primarily to an improved mix of work
to include a reduced  volume of lower  margin work  performed  in the  southeast
region  of  the  United  States.   Insituform   East's   selling,   general  and
administrative  expenses  decreased  16%, due in part to reduced  marketing  and
administrative personnel costs during the third quarter of fiscal year 2002. The
parent company's  unallocated  general corporate  expenses  increased 69% in the
third  quarter of fiscal  year 2002,  primarily  due to an increase in legal and
consulting  fees  incurred in  connection  with the  Company's  recapitalization
proposed for adoption by stockholders at the Company's annual meeting for fiscal
year 2001 held on May 14, 2002.

     Investment  income  decreased 50% in the third quarter of fiscal year 2002,
primarily  as a result  of a decline  in  interest  rates.  Other  expense  -net
decreased  from a net expense of  $212,283  in the third  quarter of fiscal year
2001 to a net  expense  of $60,266  in the third  quarter  of fiscal  year 2002,
primarily  as a result  of a lesser  decrease  in the cash  surrender  values of
insurance  policies  funding the parent company's  supplemental  retirement plan
during the current quarter.

     The  credit  for income  taxes for the third  quarter  of fiscal  year 2002
includes a credit for income taxes of $683,000  recorded by Insituform East as a
result of tax legislation enacted during the quarter permitting  Insituform East
to carry back tax losses incurred during fiscal year 2001 against taxable income
recognized  during  fiscal year 1996.  The credit for income taxes for the third
quarter of fiscal year 2001 was  recorded by the parent  company.  No credit for
income taxes was  recorded by  Insituform  East for the third  quarter of fiscal
year 2001 as the credit  calculated using  applicable  enacted federal and state
tax  rates of 39% of  pretax  losses  was  applied  to  increase  the  valuation
allowance recorded against the deferred tax asset.

        Nine Months Ended 3/31/02 Compared with Six Months Ended 3/31/01

     Consolidated sales decreased $3.5 million (-19%) from $18.4 million for the
nine  months  ended March 31,  2002 to $14.9  million for the nine months  ended
March  31,  2001,  due  primarily  to  reduced  comparable  period  sales in the
southeast  region of the United States and, to a lesser extent, a reduced volume
of immediately  workable  backlog in Insituform  East's  licenses  Insituform(R)
process territory.

     The  consolidated  operating  loss  increased 42% from -$1.6 million in the
nine months ended March 31, 2001 to -$2.2 million in the nine months ended March
31,  2002.  Consolidated  cost of sales  decreased  16% in the nine months ended
March 31, 2002 as compared to the nine months ended March 31, 2001. As a result,
gross profit as a percentage of sales  decreased  from a gross profit of 12% for
the nine months ended March 31, 2001 to a gross profit of 9% for the nine months
ended  March 31,  2002.  This  decrease  is due  primarily  to  reduced  margins
experienced  in the southeast  region of the United States and the absorption of
semi-fixed costs over reduced sales levels.  Insituform East's selling,  general
and  administrative  expenses decreased 14% due in part to reduced marketing and
legal expenses during the nine months ended March 31, 2002. The parent company's
unallocated  general  corporate  expenses  increased  26%  primarily  due  to an
increase in legal and consulting fees in the third quarter of fiscal year 2002.

     Investment  income  decreased  43% in the nine months ended March 31, 2002,
primarily  as a  result  of a  decline  in  interest  rates.  Other  expense-net
decreased from a net expense of $599,840 in the nine months ended March 31, 2001
to a net expense of $145,268 in the nine months ended March 31, 2002,  primarily
as a result of a lesser  decrease  in the cash  surrender  values  of  insurance
policies funding the parent company's supplemental retirement plan.

     The  credit for  income  taxes for the nine  months  ended  March 31,  2002
includes a credit for income taxes of $683,000  recorded by Insituform East as a
result of tax  legislation  enacted during the third quarter of fiscal year 2002
permitting  Insituform East to carry back tax losses incurred during fiscal year
2001 against  taxable income  recognized  during fiscal year 1996. The provision
for income  taxes for the nine months  ended March 31, 2001 was  recorded by the
parent  company.  No credit for income taxes was recorded by Insituform East for
the nine months ended March 31, 2001 as the credit  calculated  using applicable
enacted  federal  and state tax rates of 39% of pretax  losses  was  applied  to
increase the valuation allowance recorded against the deferred tax asset.

Financial Condition

     During the nine  months  ended  March 31,  2002,  the  Company's  operating
activities used approximately $0.7 million in cash, primarily as a result of the
Company's net loss and amounts attributable to non-owned interests in Insituform
East's net loss.  The  positive  effect on cash flow of a $447,255  decrease  in
accounts  receivable,  and the effect of expense items  included in the net loss
that did not require the outlay of cash, such as $1,179,505 in depreciation  and
amortization expense and a $328,865 increase in the supplemental retirement plan
liability,  were  offset by the  negative  effects  on cash  flow of a  $796,702
increase in prepaid  expenses,  primarily a $683,000  increase in prepaid taxes,
and an $801,733 decrease in accounts payable and accrued expenses.

     The Company's investing activities provided $2.7 million in cash during the
nine months ended March 31, 2002,  primarily due to the timing between purchases
and redemptions of its investments in marketable  debt  securities.  The Company
used cash of $0.2  million in its  financing  activities,  primarily  due to the
payment of dividends by the parent company, CERBCO.

     The  Company's   liquidity   remained   strong  with  working   capital  of
approximately  $18.0  million and a current ratio of 9.7 to 1 at March 31, 2002.
As of March  31,  2002,  the  parent  company,  CERBCO,  has cash and  temporary
investments in excess of $12.0 million, which it believes are more than adequate
to meet  its own  cash  flow  requirements  and the  temporary  requirements  of
Insituform East in the foreseeable future.



<PAGE>


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.  The Company's  ability to predict  results or the actual effect of
future plans or strategies is  inherently  uncertain.  Factors that could have a
material  adverse affect on the  operations and future  prospects of the Company
include,  but are not  limited  to, the  availability  of  immediately  workable
backlog,  mix of work,  weather,  changes in interest rates and general economic
conditions,  and  legislative/regulatory  changes. These risks and uncertainties
should be considered in evaluating forward-looking statements and undue reliance
should not be placed on such statements.


                           PART II - OTHER INFORMATION

Item 1.  Legal Proceedings
--------------------------

     See Part I, Item 1, "Notes to Condensed  Consolidated  Financial Statements
(unaudited)  - Note  7.  Contingencies"  for  details  concerning  a  previously
disclosed  lawsuit filed in the U.S.  District Court for the Middle  District of
Tennessee against Insituform East and Midsouth Partners.

Item 2.  Changes in Securities and Use of Proceeds
--------------------------------------------------

         Not applicable.

Item 3.  Defaults upon Senior Securities
----------------------------------------

         Not applicable.

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

         Not applicable.

Item 5.  Other Information
--------------------------

     As  previously  disclosed,  the Company had  determined to delay its annual
meeting of  stockholders,  typically  held in the  second  quarter of the fiscal
year. On April 16, 2002,  the Company sent notice to its  stockholders  that its
annual meeting would be held on May 14, 2002 in Wilmington, Delaware.

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

(a)      Exhibits:

         99 - CERBCO, Inc. Consolidating Schedules: Statement of Operations
              Information for the three months ended March 31, 2002; Statement
              of Operations Information for the nine months ended March 31,
              2002; Balance Sheet Information and Consolidating Elimination
              Entries as of March 31, 2002.

(b)      Reports on Form 8-K:

         No reports on Form 8-K were filed during the quarter ended March 31,
2002.


<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.

Date: May 15, 2002

                        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)


                                  CERBCO, Inc.
                  3421 Pennsy Drive o Landover o Maryland 20785
                                Tel: 301.773.1784
                                Fax: 301.322.3041
                         24-Hour FaxVault: 301.773.4560