<PAGE>   1
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 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 September 30, 1997

[ ]      Transition report under Section 13 or 15(d) of the Exchange Act For the
         transition period from _____________ to _____________

         Commission file number 0-29236


                         MARINE MANAGEMENT SYSTEMS, INC.
        (Exact Name of Small Business Issuer as Specified in Its Charter)

         Delaware                                             06-0886588
(State or Other Jurisdiction of                             (I.R.S. Employer
Incorporation or Organization)                            Identification Number)

                      470 West Avenue, Stamford, CT, 06902
                    (Address of Principal Executive Offices)

                                 (203) 327-6404
                (Issuer's Telephone Number, Including Area Code)

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

Yes  _x_   No  ___

Number of Shares of Issuer's Common Stock, $.002 par value outstanding as of
October 31, 1997 was 4,421,120

Transitional Small Business Disclosure Format (check one):

Yes  __  No  _x_


<PAGE>   2
                         MARINE MANAGEMENT SYSTEMS, INC.
                                   Form 10-QSB
                                TABLE OF CONTENTS


PART I - FINANCIAL INFORMATION                                          Page No.

Item 1.  Financial Statements  (unaudited, except as noted)               3-9

         Balance Sheets, September 30, 1997  and December 31, 1996
         (audited)                                                          3

         Statements of Operations, Three Months and  Nine Months Ending     4
         September 30, 1997 and  September 30, 1996

         Statement of Cash Flows,  Nine Months Ending September 30, 1997    5
         and September 30, 1996

         Notes to Financial Statements                                      6

Item 2.  Management's Discussion and Analysis or Plan of Operation         10


PART II - OTHER INFORMATION

Item 2.  Changes in Securities and Use of Proceeds                         15
Item 6.  Exhibits and Reports on Form 8-K                                  16
Signatures                                                                 17
<PAGE>   3
PART I - FINANCIAL INFORMATION
Item 1.  Financial Statements

                         MARINE MANAGEMENT SYSTEMS, INC.

                                 BALANCE SHEETS


<TABLE>
<CAPTION>
                                                                                9/30/97            12/31/96
                                                                              (unaudited)
<S>                                                                           <C>                 <C>
Assets
Current:
  Cash                                                                        $    963,352        $     58,117
  Accounts receivable                                                            1,582,554             954,480
  Inventories                                                                       16,061              22,307
  Prepaid expenses and other                                                       115,369              44,865
                                                                              ------------        ------------

     Total current assets                                                        2,677,336           1,079,769
Property and Equipment, net of accumulated depreciation                            208,837             210,449
     of $240,327 and of $170,340
Computer software costs, net of accumulated amortization
     of $1,546,426 and $1,306,426                                                2,937,302           2,002,281
Deferred registration costs                                                           --               314,141
Other                                                                                 --                 5,914
                                                                              ------------        ------------

  Total Assets                                                                $  5,823,475        $  3,612,554
                                                                              ============        ============


Liabilities and Stockholders' equity (deficit) 
Current:
  Short-term borrowings                                                       $    475,000        $    975,000
  Accounts payable and accrued expenses                                            649,958             812,914
  Subordinated debt - related parties                                                 --               410,000
  Billings in excess of costs on uncompleted contracts                              92,831              81,704
  Deferred revenue                                                                 133,428             275,226
  Customer deposits                                                                 80,497              79,240
  Current portion of long-term debt and capital lease obligations                  111,768             296,767
                                                                              ------------        ------------

     Total current liabilities                                                   1,543,482           2,930,851
Long-term debt and capital lease obligations, less current portion                 131,207             266,292
Subordinated debt - related parties                                                666,000             666,000
                                                                              ------------        ------------

     Total liabilities                                                           2,340,689           3,863,143
                                                                              ------------        ------------

Redeemable preferred stock, $100 par value, 8% cumulative, 7,500 shares
  authorized, none and 7,500 shares issued and outstanding                            --               750,000
                                                                              ------------        ------------


Stockholders' equity (deficit):
  Common stock, $.002 par value, 9,000,000 shares authorized,
    4,421,120 and 2,701,110 issued and outstanding                                   8,842               5,402
  Additional paid-in capital                                                    11,535,485           5,333,475
  Loans receivable officers                                                           --              (388,837)
  Accumulated deficit                                                           (8,061,541)         (5,950,629)
                                                                              ------------        ------------
     Total stockholders' equity (deficit)                                        3,482,786          (1,000,589)

  Total Liabilities and Stockholders' Equity (Deficit)                        $  5,823,475        $  3,612,554
                                                                              ============        ============
</TABLE>

                                                                               3

                See accompanying Notes to Financial Statements
<PAGE>   4
                         MARINE MANAGEMENT SYSTEMS, INC.
                            STATEMENTS OF OPERATIONS
                                   (UNAUDITED)



<TABLE>
<CAPTION>
                                            Three Months Ended September 30,     Nine Months Ended September 30,
                                            --------------------------------     -------------------------------

                                                  1997            1996                 1997             1996
                                                  ----            ----                 ----             ----
<S>                                          <C>              <C>                  <C>              <C>
Revenues
  Software                                   $   630,356      $   302,356          $ 1,882,956      $ 1,349,225
  Hardware                                       225,468          249,596              655,202        1,317,846
  Contract                                        20,000          204,939              199,457          837,960
                                             -----------------------------         -----------------------------
                                                 875,824          756,891            2,737,615        3,505,031

Cost of Revenues:
  Software                                       325,332          239,677              792,326          864,646
  Software amortization                           90,000           61,167              240,000          189,839
  Hardware                                        97,304          160,673              423,988        1,007,961
  Contract                                        20,000          123,907              170,418          480,587
                                             -----------------------------         -----------------------------
                                                 532,636          585,424            1,626,732        2,543,033


     Gross profit                            $   343,188      $   171,467          $ 1,110,883      $   961,998

Operating expenses:
  Research and development                        57,651          129,279              149,691          226,545
  Selling and administrative                     920,182          370,779            2,628,810        1,341,505
  Depreciation and amortization                   23,308           28,680               69,965           61,104
                                             -----------------------------         -----------------------------
                                               1,001,141          528,738            2,848,466        1,629,154

Loss from operations                            (657,953)        (357,271)          (1,737,583)        (667,156)

Other income (expense):
  Interest expense, net of interest inc           (3,615)         (10,435)            (373,329)        (122,305)



Net loss                                     $  (661,568)     $  (367,706)         $(2,110,912)     $  (789,461)
                                             =============================         ============================

Loss per share of common stock and
     common stock equivalents                $     (0.15)     $     (0.11)         $     (0.57)     $     (0.29)

Weighted average number of common              4,397,780        2,879,407            3,711,085        2,623,736
     shares outstanding
</TABLE>

                                                                               4
                 See accompanying Notes to Financial Statements
<PAGE>   5
                         MARINE MANAGEMENT SYSTEMS, INC.
                            STATEMENTS OF CASH FLOWS

                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                    Nine Months Ended September 30,

                                                                         1997              1996
                                                                         ----              ----
<S>                                                                  <C>              <C>
Cash flows from operating activities:
Net (loss)                                                           $(2,110,912)     $  (789,461)
    Adjustments to reconcile net loss to net cash
    used in operating activities:
      Depreciation and amortization                                      309,965          250,943
      Provision for losses on accounts receivable                                          25,000
      Discount on issuance of preferred stock                                              13,076
    Changes in Assets and Liabilities
      Accounts receivable                                               (628,074)         237,687
      Inventory                                                            6,246            2,777
      Prepaid expenses                                                   (70,504)         (81,224)
      Deferred registration costs and other                                              (133,898)
      Accounts payable and accrued expenses                             (571,566)         202,990
      Other                                                                5,914                0
      Billings in excess, deferred revenue and customer deposits        (129,414)        (113,925)
                                                                     -----------      -----------

NET CASH USED IN OPERATING ACTIVITIES                                $(3,188,345)     $  (386,035)

Cash flows from investing activities:
      Capitalized computer software costs                             (1,175,021)        (871,168)
      Acquisitions of property and equipment - net                       (68,355)         (31,153)
                                                                     -----------      -----------

NET CASH USED IN INVESTING ACTIVITIES                                $(1,243,376)     $  (902,321)

CASH FLOWS FROM FINANCING ACTIVITIES:
      Proceeds from line of credit                                                         25,000
      Proceeds from advances payable                                                      125,000
      Long-term debt and capitalized lease obligations                  (320,084)         (94,338)
      Net proceeds from sale of preferred stock                                           500,000
      Net proceeds from sale of common stock                           5,657,040          732,875
                                                                     -----------      -----------

NET CASH PROVIDED BY FINANCING ACTIVITIES                            $ 5,336,956      $ 1,288,537
                                                                     -----------      -----------

NET INCREASE IN CASH                                                     905,235              181

CASH, BEGINNING OF PERIOD                                                 58,117           15,350
                                                                     -----------      -----------

CASH, END OF PERIOD                                                  $   963,352      $    15,531
                                                                     ===========      ===========


SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for:
    Interest                                                         $   177,672      $    60,326
Supplemental disclosure of non-cash investing and
     financing activity:
     Discount of subordinated short term loan                        $   146,000
     Conversion of debt for equity                                   $ 1,000,000
</TABLE>

                                                                               5
                 See accompanying Notes to Financial Statements
<PAGE>   6
                         MARINE MANAGEMENT SYSTEMS, INC.

                          NOTES TO FINANCIAL STATEMENTS

                                    UNAUDITED


NOTE 1.  NATURE OF BUSINESS

         Marine Management Systems, Inc. (the "Company") provides a variety of
products and services related to ship operations and maintenance management. The
Company develops and sells computer software programs, information systems and
computer equipment, as well as provides support and engineering services related
to these products throughout the world.

NOTE 2.  BASIS OF PRESENTATION

(a) The accompanying unaudited financial statements, which are for interim
periods, except the December 31, 1996 balance sheet, do not include all
information contained in the Company's audited financial statements and the
footnotes thereto for the year ended December 31, 1996 (the "Financial
Statements"). The December 31, 1996 balance sheet was derived from the audited
Financial Statements. Certain information and footnote disclosures included in
the Financial Statements, which are prepared in accordance with generally
accepted accounting principles, have been condensed or omitted. The accompanying
unaudited financial statements were prepared on a basis consistent with the
Financial Statements.

(b) In the opinion of the Company, the accompanying unaudited financial
statements contain all adjustments (which are of a normal recurring nature)
necessary for a fair presentation of the financial statements. The results of
operations for the three months and nine months ending September 30, 1997 are
not necessarily indicative of the results to be expected for the full year.

(c)      Computer Software Costs and Amortization
         The Company capitalizes the direct costs and allocated overhead
associated with the development and testing of software programs after
technological feasibility has been established. The annual amortization of the
capitalized costs is the greater of the amount computed using the rates that
current gross revenues for a product or products bear to the total of current
and anticipated future gross revenues for that product or products, or the
straight-line method over the remaining estimated economic life of the product
including the period being presented. The establishment of technological
feasibility and the on-going assessment of recoverability of capitalized
computer software costs require considerable judgment by management with respect
to certain external factors, including, but not limited to, anticipated future
revenues, estimated economic life and changes in 

                                       6
<PAGE>   7
software and hardware technologies. Research and Development expenditures are
expensed in the period incurred.

(d)      Loss Per Share

         Loss per share of Common Stock is calculated by dividing net loss by
the weighted average number of shares of Common Stock and common stock
equivalents, if dilutive, outstanding during each of the periods presented after
giving retroactive effect to a 1 for 2.7 reverse stock split effected on August
21, 1996. In addition, Common Stock and common stock equivalents issued by the
Company at a price less than the initial public offering price of the common
stock during the twelve months immediately preceding the initial public offering
are treated as outstanding for all periods presented, using the treasury stock
method.


(e)      Revenue and Cost Recognition

         Software revenues are revenues which are derived from the sale of
software, extended warranty and support services to the marine industry
customers. Revenues are recognized in the period when the products are delivered
or the services are rendered. Revenues from the sales of extended warranty
contracts are deferred and recognized on a straight-line basis over the term of
the contract.

         Hardware revenues are revenues which are derived from the sale of
hardware to non-marine and marine industry customers.

         Revenues for contracts with a term in excess of one year are recognized
using the percentage of completion method, measured by percentage of costs
incurred to date to estimated total costs for each contract. Contract costs
include all direct costs and those indirect costs related to contract
performance. Provisions for estimated losses on uncompleted contracts are made
in the period in which such losses are determined. Changes in job performance,
job conditions and estimated profitability may result in revisions to costs and
income and are recognized in the period in which revisions are determined.
Billings in excess of costs and estimated earnings on uncompleted contracts
represent billings in excess of revenues recognized on contracts in progress.
Revenues for contracts with a term of less than one year are recognized when
either the services are performed or when the products are delivered.



(f)      Deferred Registration Costs

         Costs incurred in connection with the Company's initial public offering
were deferred and offset against the proceeds of the initial public offering
effective May 1, 1997.

(g)      Recent Accounting Announcements

                                                                               7
<PAGE>   8

         During February 1997, the Financial Accounting Standards Board (FASB)
issued SFAS No. 128, "Earnings per Share", which replaces the presentation of
primary earnings per share ("EPS") with basic EPS. It also requires dual
presentation of basic and diluted EPS. SFAS No. 128 is effective for periods
ending after December 15, 1997.

         During June 1997, FASB issued SFAS No. 130 "Reporting Comprehensive
Income"' which establishes standards for reporting and display of comprehensive
income, its components and accumulated balances. Comprehensive income is defined
to include all changes in equity except those resulting from investments by
owners and distribution to owners. Among other disclosures, SFAS 130 requires
that all items that are required to be recognized under current accounting
standards as components of comprehensive income be reported in a financial
statement that is displayed with the same prominence as other financial
statements.

         SFAS 130 is effective for financial statements for periods beginning
after December 15, 1997 and requires comparative information for earlier years
to be restated. Because of the recent issuance of this standard, management has
been unable to fully evaluate the impact, if any, the standard may have on
future financial statement disclosures. Results of operations and financial
position, however, will be unaffected by implementation of this standard.

NOTE 3.  CASH BALANCES

         Cash balances in September of $963,352 include $650,000 certificate of
deposit and $313,352 of cash on hand and in banks. The certificate of deposit is
hypothecated against approximately $650,000 in long term and revolving loans.


NOTE 4.  INITIAL PUBLIC OFFERING

(a) The Company completed an initial public offering (the "Initial Public
Offering") underwritten by Whale Securities Co., L. P. on May 1, 1997 of
1,440,000 shares of Common Stock of the Company at a price of $5.00 per share
and 1,656,000 warrants at a price of $.10 per warrant. Each warrant will be
exercisable effective May 1, 1998, to purchase one share of Common Stock at
$5.50 per share. For further information with respect to the Company and such
securities, reference is made to the Company's Registration Statement on Form
SB-2 (File No. 333-21043) and the exhibits and schedules filed as part thereof.


(b) Immediately prior to effectiveness of the Company's Initial Public Offering,
certain officers of the Company satisfied their respective outstanding debt to
the Company in the aggregate amount of $388,837 by selling to the Company 77,767
shares of the Company's Common Stock. As of December 31, 1996, such balances
have been included as a reduction of stockholders' equity.

                                                                               8
<PAGE>   9
NOTE 5.  SALE OF INVESTMENT UNITS

          In January 1997, the Company completed the sale of seven investment
units (the "Bridge Units") to six private investors at a price of $50,000 per
Bridge Unit for total gross proceeds of $350,000 (the "Bridge Financing"). Each
Bridge Unit consisted of a 9% promissory note of the Company in the principal
amount of $50,000, maturing upon the consummation, and payable out of the
proceeds, of the Initial Public Offering (each a "Bridge Note") and the 10,000
shares of Common Stock (the "Bridge Shares"). In May 1997, an aggregate of
20,000 Bridge Shares were returned to the Company by two investors in the Bridge
Financing for no consideration.

         In connection with the sale of the Bridge Units, the Company recognized
a loan discount in the amount of $146,000 and debt issuance costs of $32,000.
The Company recognized a charge to operations in the second quarter in the
amount of $178,000 for satisfaction of the debt from the proceeds of the Initial
Public Offering.

NOTE 6.  CII TRANSACTIONS

         Immediately prior to the consummation of the Initial Public Offering,
all 7,500 shares of the redeemable preferred stock, par value $100 per share,
which shares were held by Connecticut Innovations, Incorporated ("CII") an
agency of the State of Connecticut and a principal stockholder of the Company,
converted into an aggregate 277,777 shares of Common Stock. In addition, the
remaining $235,924 principal amount plus accrued interest outstanding under the
Company's March 1995 promissory note to CII was paid out of the proceeds of the
Initial Public Offering. Simultaneous with the consummation of this offering,
the Company used $94,185 of the proceeds from the Initial Public Offering to buy
back from CII warrants which were exercisable to purchase 129,944 shares of
Common Stock at an exercise price of $2.31 per share. This transaction was
consummated and the amount was charged to operations (interest) during the
second quarter of 1997.





                                                                               9
<PAGE>   10
Item 2.  Management's Discussion And Analysis Or Plan Of Operation

         This report contains "forward-looking statements" within the meaning of
the Private Securities Litigation Reform Act of 1995. Statements in this report
which are not historical facts are forward looking statements. Such
forward-looking statements, including those concerning the Company's
expectations for liquidity, demand and sales of new and existing products,
industry and market segment growth and market and technology opportunities, all
involve risks and uncertainties. Actual results may differ materially from such
forward-looking statements for reasons including, but not limited to, changes in
the marine transportation industry, delays or problems in the development and
commercialization of the Company's products, customer interest in and acceptance
of the Company's current and new products and services, the impact of
competitive products and services and technological changes affecting the
Company's products and products under development.

Overview

         The Company made initial modules of the Windows-based version of the
Fleet Manager Series commercially available in July and August 1997. The
remaining modules of the Windows-based Fleet Manager Series of products are near
completion and are in final testing . The Company expects the balance of Fleet
Manager Series modules to be commercially available by the end of 1997. While
the Company expects significant growth in revenues from the introduction of
these products, there can be no assurance that any introduction of Windows-based
products by the Company's competitors prior to the Company's completion of its
new product version will not exert downward price pressure on the Company's
existing Fleet Manager Series products or will not render them obsolete and
unmarketable. Moreover, there can be no assurances that the Company will be able
to successfully complete development of the remaining Windows-based products
within the anticipated time frame, of that the Windows-based version of the
Fleet Manager Series will achieve market acceptance.

         Starting in mid-1995, the Company began the development of the
Integrated Shipboard Information Technology (ISIT) platform for the maritime
industry. This platform is designed to permit the integration of a myriad of
ship equipment and informational systems under a common protocol, including
proposed ISIT-compliant versions of the Company's Fleet Manager Series products
currently under development, and to provide a standard interface to shore-based
systems. When completed, the ISIT platform is intended to provide users with a
common communication path for all of their ISIT-compliant software applications,
enabling them to use most satellite services and a variety of telephone networks
and services, including the Internet. ISIT is also intended to provide a means
for collecting and storing a ship's operating data (for instance the data found
in the various control systems on the ship's bridge and engine room which
operate with their own proprietary protocols) in a common database and format.

                                                                              10
<PAGE>   11

         The Company completed the initial development and began testing of the
ISIT platform in the second quarter of 1997. It is postponing the initial
marketing of the ISIT platform and ISIT-compliant versions of its Windows-based
Fleet Manager Series products until the middle of 1998, electing to initially
work with selected companies to build specific interfaces to ISIT. The Company
believes this will lead to a stronger product and the ability, as part of its
marketing strategy, to provide demonstrations of successful commercial
applications of ISIT. While the Company believes the ISIT platform and ISIT
compliant versions of its Fleet Manager Series will result in significant growth
in revenues, there can be no assurance that the development of the ISIT platform
or of ISIT-compliant versions of the Fleet Manager Series or other products will
be completed and ready for market by the middle of 1998, or that any product
resulting from such development will adequately meet the requirements of the
marketplace or achieve market acceptance. The success of the Company in
developing, introducing, selling or supporting the ISIT platform, ISIT-compliant
versions of the Fleet Manager Series or additional ISIT platform-related
products will depend on a variety of factors in addition to the timely and
successful completion of product design and development, including: timely and
efficient implementation of the manufacturing process; effective sales,
marketing and customer services; and the absence of performance problems or
other difficulties that may require design modifications and related expenses
and hinder market acceptance. If the market for the ISIT platform fails to
develop, develops more slowly than anticipated or if ISIT-compliant products do
not achieve market acceptance, the Company's business, results of operations and
financial condition will be materially adversely affected.

         The Company's future level of sales and potential profitability will
depend on many factors including: an increased demand for the Company's existing
products; the ability of the Company to develop and sell new products and
product versions to meet customers' needs; the ability of management to control
costs and successfully implement the Company's strategy; and the ability of the
Company to develop and deliver products in a timely manner.

Results Of Operations

Three Months Ending September 30, 1997 Compared to Three Months Ending September
30, 1996.

         Revenues. Total revenues increased 15.7% from $756,891 for the quarter
ended September 30, 1996 to $875,824 for the quarter ended September 30, 1997.
The increase was due entirely to a significant increase in software sales which
more than offset the decline in hardware and contract business. Software
revenues increased 108.5% from $302,356 for the third quarter of 1996 to
$630,356 for the third quarter of 1997, primarily due to increased sales of the
Windows-based version of the Fleet Manager Series. Hardware revenues decreased
9.7% from $249,656 in the third quarter of 1996 to $225,468 for the third
quarter of 1997, primarily reflecting non-replacement of a major hardware sale
to a non-marine customer during the third quarter of 1996. Contract 

                                                                              11
<PAGE>   12
revenues decreased 90.2% from $204,939 for the third quarter of 1996 to $20,000
for the third quarter of 1997, reflecting the winding down of the U.S.
Government's partial funding of the ISIT project.

         Gross profit. Gross profit increased 100% from $171,467 for the third
quarter of 1996 to $343,188 for the same quarter of 1997. Gross margins
increased from 22.7% in the third quarter of 1996 to 39.2% in the third quarter
of 1997 as a result of the significant change in product mix to the higher
margin software products, and away from less profitable hardware sales and
government contract revenues.

         Operating expenses. Operating expenses increased 89.3% from $528,738 in
the third quarter of 1996 to $1,001,141 in the third quarter of 1997 primarily
as a result of the increase in Selling and Administration expenses of $549,403
from 1996 to 1997. This increase was primarily due to an increase in sales,
marketing and client services personnel between the comparable periods as the
Company anticipated the launch of new software products and services.

         Other income (expense). Interest expense for the third quarter of 1997
reflects the cost of interest offset by interest income cash balances held in
banks.

         Net loss. The net loss for the third quarter of 1997 increased 79.9% to
$661,568 from $367,706 for the third quarter of 1996. This net loss increase was
a result of higher selling and administrative expenses partially offset by
increased sales and profit margins.

Nine Months Ending September 30, 1997 Compared to Nine Months Ending September
30, 1996.

         Revenues. Total revenues decreased 21.9% from $3,505,031 for the nine
months ended September 30, 1996 to $2,737,615 for the nine months ended
September 30, 1997. The decrease was due to the decline of hardware sales to
non-marine customers which outweighed the increase in software revenues.
Software revenues increased 39.6% from $1,349,225 in the first nine months of
1996 to $1,882,956 in the first nine months of 1997 due to increased Fleet
Manager Series sales and services. Hardware revenues decreased 50.3% from
$1,317,846 in the first nine months of 1996 to $655,202 in the first nine months
of 1997 primarily as a result of the completion of non-recurring major hardware
sale to a non-marine customer during the 1996 period. Contract revenues
decreased 76.2% from $837,960 in the first nine months of 1996 to $199,457 in
the first nine months of 1997 as a result of the winding down of the U. S.
government's partial funding of the ISIT project.


         Gross profit. Gross profit increased 15.5% from $961,998 for the first
nine months of 1996 to $1,110,883 for the first nine months of 1997, reflecting
the improved product mix of sales. Gross margins increased from 27.4% in the
first nine months of 1996 to 40.6% in the first nine months of 1997, reflecting
increased sales of higher 

                                                                            12
<PAGE>   13
margin software sales coupled with reduced levels of lower margin hardware and
contract revenues.

         Operating expenses. Operating expenses increased 74.8% from $1,629,154
in the first nine months of 1996 to $2,848,466 in the first nine months of 1997
reflecting primarily the increase in Selling and Administration expenses of
$1,287,305 from 1996 to 1997. This increase was primarily due to an increase in
sales and marketing personnel and related expenses between the comparable
periods as the Company anticipated the launch of new software products.

         Other income (expense). Interest expenses increased 205.2% from
$122,305 in the first nine months of 1996 to $373,329 in the first nine months
of 1997. This increase was primarily due to the recognition of two one-time
charges totaling $272,158 charged to operations related to the satisfaction of
debt out of the proceeds from the Initial Public Offering.

         Net loss. The Company's net loss increased from $789,461 for the first
nine months of 1996 to $2,110,912 for the first nine months of 1997 primarily as
a result of increased operating and interest expenses partially offset by
improved margins, as described above.




Liquidity And Capital Resources

         Net cash used in operations was $3188,345 for the nine months ended
September 30, 1997 compared to $386,035 for the same nine month period in 1996.
The net cash used in operations during the first nine months of 1997 was
primarily attributed to increased operating expenses, particularly for sales and
marketing salaries and expenses as the Company anticipated the launch of
Windows-based products, coupled with a reduction in accounts payable from funds
made available from the Initial Public Offering, and an increase in accounts
receivable.

         Net cash used in investing activities was $1,243,376 for the nine
months ended September 30, 1997 compared to $902,321 for the same nine month
period in 1996. The net cash used in investing activities during this period was
primarily attributed to capitalized software development costs for both the
Windows-based Fleet Manager product and for ISIT development. The Company's cash
requirements to fund developmental expenses incurred in connection with the
establishment of new products have decreased during the third quarter as the
development and testing of the Window-based Fleet Manager Series products near
completion.

         Net cash provided by financing activities was $5,336,956 for the nine
months ended September 30, 1997 compared to $1,288,537 for the nine months
period in 1996. 

                                                                              13
<PAGE>   14
In May 1997, the Company completed its Initial Public Offering which generated
net proceeds of $5,657,040 net of underwriting discounts, commissions and
expenses of the offering. Cash from the Initial Public Offering was used to pay
down long term and short term debt, as well as to fund development and operating
cash requirements.

         As of September 30, 1997, the Company had cash of $963,352 and working
capital of $1,133,854. The cash balance of $963,352 includes $650,000
certificate of deposit which is hypothecated against approximately $650,000 in
long-term and revolving loans. The Company anticipates, based on its current
level of revenues, that its current cash balances may not be sufficient to fund
the Company's operations and capital requirements beyond the fourth quarter of
1997. Management has taken actions to reduce the Company's cash requirements,
including selected staff reductions and cost deferments. While management
believes that the release of its Windows-based Fleet Manager Series products may
result in increased revenues, the Company may be required to seek additional
financing.

         The Company has initiated discussions with several potential sources of
additional financing, but has no current arrangements with respect to such
financing. There can be no assurance that any additional financing, if needed,
will be available to the Company, on commercially reasonable terms, or at all.
The failure to obtain any needed additional financing would have a material
adverse effect on the Company. If the Company is unable to obtain additional
financing and exhausts its current sources of capital, the Company will be
required to take additional actions to continue its operations. Such actions may
include immediate reduction of the Company's operating costs and other
expenditures including additional staff reductions and cost deferments. Any such
actions may limit the Company's opportunities to achieve increased sales and may
affect the Company's ability to achieve break-even or profitable operations.





                                                                              14
<PAGE>   15
PART II - OTHER INFORMATION

Item 2. Changes in Securities and Use of Proceeds

         The Company sold 1,440,000 shares of Common Stock, par value $.002 per
share, and 1,656,000 warrants, each to purchase one share of Common Stock at an
exercise price of $5.50 per share, pursuant to a registration statement on Form
SB-2 (File No. 333-21043), which was declared effective by the Securities and
Exchange Commission on May 1, 1997. The underwriter of the offering was Whale
Securities Co., L P. The aggregate gross proceeds of the offering were
$7,365,600. The Company's total expenses in connection with the offering were
$1,708,560, of which $736,560 was for underwriting discounts and commissions and
$972,000 was for other expenses paid to persons other than directors or officers
of the Company, persons owning more than 10 percent of any class of equity
security of the Company or affiliates of the Company. The Company's net proceeds
from the offering were $5,657,040. As of September 30, 1997, the Company
expended the following amounts toward the purposed indicated:

<TABLE>
<S>                                                        <C>       
Repayment of indebtedness and retirement of warrants       $1,437,924
Purchase of machinery and equipment                            51,484
Sales and Marketing                                           700,000
Software development                                          999,496
Communications                                                      0
Working Capital                                             1,499,096
                                                           ----------
                                                           $4,688,000
</TABLE>

         Payments of $160,000, included in the $1,434,924 repayments of
indebtedness, were made to directors or officers (or members of their families)
of the Company as retirement of loans. No other payments were made to directors,
officers or persons owning more than 10 percent of any class of equity security
of the Company or to affiliates of the Company.

         Expenditures on communications were not anticipated until the fourth
quarter of 1997, but these expenditures will likely be deferred until 1998.
There are no other material changes in the actual use of proceeds from those
described in the Company's final prospectus dated May 1, 1997 relating to the
Initial Public Offering.

         As of September 30, 1997, the remaining net proceeds of $969,040 were
invested in Certificates of Deposits ($650,000) and cash balances and other
current assets.



                                                                              15
<PAGE>   16
Item 6.  Exhibits and Reports on Form 8-K

(a)      Exhibits. The following exhibits are filed herewith:

         11.      Statement re: Computation of Per Share Earnings

         27.      Financial Data Schedule

(b)      Reports on Form 8-K. No reports on Form 8-K were filed in the quarter
         ended September 30, 1997.


                                                                              16
<PAGE>   17
MARINE MANAGEMENT SYSTEMS, INC


                                   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.


                         MARINE MANAGEMENT SYSTEMS, INC
                                  (Registrant)

Dated:  November 12, 1997           By: /s/Robert D. Ohmes
                                        ------------------
                                    Robert D. Ohmes
                                    Executive Vice President and
                                    Chief Financial Officer


Dated: November 12, 1997            By:  /s/Eugene D. Story
                                         ------------------
                                    Eugene D. Story
                                    President and Chief Executive Officer

                                                                              17