UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

(Mark One)

[x]                 QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarter period ended: October 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:# 0-14754

(Exact Name of Registrant as specified in its Charter)

(972) 934-8797

(Registrant's telephone number, including area code)

____________________________________________

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities 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

The number of shares outstanding of each of the Issuer's Classes of Common Stock, as of the close of the period covered by this report:

Common - $0.01 Par Value - 6,471,934 shares at December 11, 2002.

Index to Form 10-Q

For the Quarter Ended October 31, 2002

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Board of Directors

Electric & Gas Technology, Inc.

We have reviewed the accompanying condensed consolidated balance sheet of Electric & Gas Technology, Inc. and Subsidiaries as of October 31, 2002 and the related condensed consolidated statements of operations, changes in stockholders' equity and cash flows for the three-month periods October 31, 2002 and 2001. These statements are the responsibility of the Company's management.

We conducted our review in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of analytical procedures applied to financial data and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications that should be made to the accompanying condensed financial statements in order for them to be in conformity with generally accepted accounting principles.

We have previously audited, in accordance with auditing standards generally accepted in the United States of America, the consolidated balance sheet of Electric & Gas Technology, Inc. and Subsidiaries as of July 31, 2002 and the related statements of operations, changes in stockholders' equity and cash flows for the year then ended (not presented separately herein), and in our report dated October 28, 2002, we expressed an unqualified opinion on those financial statements. In our opinion, the information set forth in the accompanying condensed consolidated balance sheet as of July 31, 2002 is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

/s/ Whitley Penn

Whitley Penn

Dallas, Texas

December 13, 2002

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October 31, 2002 and July 31, 2002

See accompanying notes.

4

Three Months Ended October 31, 2002 and 2001

(Unaudited)

5

Three months ended October 31, 2002

(Unaudited)

See accompanying notes.

6

Three months ended October 31, 2002 and 2001 (Unaudited)

See accompanying notes.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

October 31, 2002

(Unaudited)

NOTE A - GENERAL

     Electric & Gas Technology, Inc.("the Company" or "ELGT") was organized under the laws of the State of Texas on March 18, 1985, to serve as a holding company for operating subsidiary corporations. The Company presently is the owner of 100% of Reynolds and Hydel and owns 91.5% of AWT and, through such subsidiaries, operates in three distinct business segments: (1) production of atmospheric water, filtration and enhanced water products (AWT); (2) the manufacture and sale of natural gas measurement, metering and odorization equipment (Reynolds); and (3) the manufacture and sale of electric meter enclosures and pole-line hardware for the electric utility industry and the general public (Hydel).

     The accompanying condensed consolidated financial statements have been prepared in accordance with the regulations of the Securities and Exchange Commission (SEC) for inclusion in the Company's Quarterly Report on Form 10-Q. They are subject to year-end audit adjustments; however, they reflect all adjustments of a normal recurring nature, which are, in the opinion of Management, necessary for a fair statement of the results of operations for the interim periods.

     The statements were prepared using generally accepted accounting principles. As permitted by the SEC, the statements depart from generally accepted accounting disclosure principles in that certain data is combined, condensed or summarized that would otherwise be reported separately and certain disclosures of the type that were made in the Notes to Financial Statements for the year ended July 31, 2002 have been omitted, even though they are necessary for a fair presentation of the financial position at October 31, 2002 and 2001 and the results of operations and cash flows for the periods then ended.

NOTE B - INVENTORIES

     Inventories are comprised as follows:

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

October 31, 2002

(Unaudited)

NOTE C - ACCUMULATED OTHER COMPREHENSIVE INCOME:

     The components of other comprehensive income are as follows:

NOTE D - INDUSTRY SEGMENT DATA:

     The Company's business is primarily comprised of three industry segments: i. water (AWT); ii. natural gas measurement and recording devices and odorization (Reynolds); and iii. electrical components and enclosures (Hydel) as set forth below. Operating profits represent total sales less cost of sales and general and administrative expenses.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

October 31, 2002

(Unaudited)

NOTE D - INDUSTRY SEGMENT DATA (Continued):

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS

     The Company, through its subsidiaries, operates within three separate industries. These are (i) production of atmospheric water, filtration and enhanced water products; (ii) the manufacture of natural gas measurement equipment and gas odorization products; and (iii) the manufacture and sale of metal enclosures and other electrical equipment for use in the electric utility industry.

     Summary.  The Company reported net loss of $(127,823) and $(164,531) for the three months ended October 31, 2002 and 2001, respectively. Operating income increased by $27,459 for the three month periods, the result of decreasing expenses. Gross margins decreased from 25.52% to 24.99% for the three months ended October 31, 2002. Also, selling, general and administrative expenses as a relationship to revenues at the segment level decreased from 23.97% to 22.31% of revenues.

     Increases (decreases) for the three months periods ended October 31, 2002, as compared with the similar period of 2001, for key operating data were as follows:

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     The following table represents the changes [increase/(decrease)] in operating revenues, operating income and net earnings before income taxes by the respective industry segments when compared to the previous period:

     Water segment only had revenue of $2,161 during the first quarters of fiscal 2002. Expenses were $40,785 and $20,071 for the three months ended October 31, 2002 and 2001, respectively. The Company has entered into a contractual agreement with Lockheed Martin Corporation as a strategic partner in the sale and deployment of AWT products. The initial purchase order is for four (4) "proof of performance" systems, with a total value of $1,200,000. Two of the systems are currently anticipated for delivery in January and February 2003, with projected revenue of $600,000.

    Gas revenues decreased by $(118,328) and operating income increased by $32,969 for the three months ended October 31, 2002. This increase resulted in operating profit of $19,148 for the period. Selling, general and administrative expenses decreased to 39.38% of revenue, compared to 42.58% for the three-month period ending October 31, 2001. Expenses decreased in relation to revenues, primarily due to reduction in staffing levels, lower revenue in the lower gross margin products, change in debt structure to lower interest rates/banking fees and elimination/reduction of some outside services. The BTU meter project has been put on hold, pending resolution of technical issues. A new product is in testing phase internally, with anticipated production and sales in January to February of 2003. This product is an electronic replacement for the mechanical pressure recorder. Early interest from utility companies indicates a need and market for the cost effective "Chartless Data Recorder" (CDR).

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     Electric revenues increased for the three months ended October 31, 2002 by $65,611. Operating profits increased by $19,292 for the three months ended October 31, 2002. Revenues increased primarily in the Canadian meter socket and pole line hardware product lines serving the Canadian market, and decreased in the custom manufacturing area, primarily serving the U.S. market. The gross profit margin remained essentially unchanged increasing by 0.43% to 21.77% for the three months ended October 31, 2002. Production in the meter socket was substantially enhanced by the addition of new automated manufacturing equipment.

     With the exception of expense relationships discussed above in the specific segment discussion, such other relationships remain consistent. Operating profits increased by 69.19% for the three months ended October 31, 2002, the effect of decreased expenses, discussed above.

     Liquidity.  Current assets of the Company totaled $4,051,784 at October 31, 2002, up from current assets of $3,875,100 at July 31, 2002, or an increase of $176,684. Current liabilities decreased by $(20,899), resulting in an increase in working capital (current assets less current liabilities) of $197,583 to $1,623,592 at October 31, 2002, from $1,426,009 at July 31, 2002. The Company believes that it has and will generate sufficient cash to meet its working capital requirements and debt obligations.

     Hydel has a working capital line-of-credit with a Canadian bank in the amount of approximately $1,500,000. The Canadian credit facility is secured by receivables, inventories and equipment of Hydel.

     Reynolds has a working capital line-of-credit with a major U.S. Bank of $400,000, secured by accounts receivable and inventory.

     For Fiscal 2003, the Company (and its subsidiaries) does not anticipate any significant capital expenditures, other than in the ordinary course of replacing worn-out or obsolete machinery and equipment utilized by its subsidiaries.

     No cash dividends have been declared by the Company's Board of Directors since the Company's inception. The Company does not contemplate paying cash dividends on its common stock in the foreseeable future since it intends to utilize it cash flow to invest in its businesses.

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     In the 90-day period before the filing of this report, the President and Treasurer of the Company (collectively, the "certifying officers") have evaluated the effectiveness of the Company's disclosure controls and procedures (as such term is defined in Rules 13a-14(c) and 15d-14(c) under the Securities and Exchange Act of 1934, as amended). These disclosure controls and procedures are designed to ensure that the information required to be disclosed by the Company in its periodic reports filed with the Securities and Exchange Commission (the "Commission") is recorded, processed, summarized and reported within the time periods specified by the Commission's rules and forms, and that the information is communicated to the certifying officers on a timely basis.

     The certifying officers concluded, based on their evaluation, that the Company's disclosure controls and procedures are effective for the Company, taking into consideration the size and nature of the Company's business and operations.

     No significant changes in the Company's internal controls or in other factors were detected that could significantly affect the Company's internal controls subsequent to the date when the internal controls were evaluated.

     Inflation.  The Company does not expect the current effects of inflation to have any effect on its operations in the foreseeable future. The largest single impact affecting the Company's overall operations is the general state of the economy and principally new home construction.

     Information regarding and factors affecting forward-looking statements. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performances and underlying assumption and other statements, which are other than statements of historical facts. Certain statements contained herein are forward-looking statements and, accordingly, involve risks and uncertainties, which could cause actual results or outcomes to differ materially from those expressed in the forward-looking statements. The Company's expectations, beliefs and projections are expressed in good faith and are believed by the Company to have a reasonable basis, including without limitations, management's examination of historical operating trends, data contained in the Company's records and other data available from third parties, but there can be no assurance that management's expectations, beliefs or projections will result, or be achieved, or accomplished.

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ITEM 1. LEGAL PROCEEDINGS

     Unites States of America, Plaintiff Vs Commercial Technology, Inc., et.al., Defendant in the United States District Court, Northern District of Texas. Case number 3-99-CV-2668-X. Plaintiff brought an action to collect on a defective judgment to force the sale of an office building, which was acquired from the defendant by ELGT in 1987. The court has ruled that the transaction the Government relied upon to enforce the judgment was not a debt and was therefore not entitled to relief under the Act; and that they are not entitled to a judicial sale of the property. The Government's only further action was under the Texas Fraudulent Conveyance. A jury trial was held between March 26 and April 6, 2001. The court granted a motion as to the Company and dismissed all claims. However, a unanimous verdict was returned in favor of the Plaintiff on April 6, 2001 finding that Commercial Technology, Inc. ("Comtec") transferred a piece of real property to the Company in violation of the Texas Uniform Fraudulent Transfer Act ("Act"). Commercial Technology, Inc. and the Company filed on April 27, 2001 a renewed motion for judgment as a matter of law, or, alternatively, for a new trial. Such motion will show that the real property is not an asset under the Act, the Company's Hypothecation Agreement operates as a deed and therefore the Company acquired equitable title and/or is entitled to subrogation. The Company's appeal was pending Comtec's filing of a Chapter 11 bankruptcy proceeding on July 3, 2001. Such proceeding has been dismissed. The Company's appeal to the United States Court of Appeals for the Fifth Circuit is presently in progress. In order to go forward with the appeal, the court required the Company to obtain a performance bond in the amount of approximately $500,000. CIT Group Credit Finance, Inc. ("CIT") held what bankruptcy counsel believes is a secured lien on the building as a result of their loans to the Company. An affiliate of the Company acquire d CIT's secured lien on the building. The Company will vigorously defend its position. The Company believes the ultimate outcome of the above matter will not have a material effect on the Company's financial position.

     Electric & Gas Technology, Inc., Retech, Inc. and Hydel Enterprises, Inc. (Plaintiff) Vs Nathan Mazurek, American Circuit Breaker Corp. and Provident Group, Inc. (Defendants)- Civil Action N. 3:01-CV-2756-G. Plaintiff filed suit in the 160^th District Court in Dallas, County. The Case has been removed to United States District Court for the Northern District of Texas, Dallas Division. Plaintiff alleges the non-payment of a note to Retech, Inc. of approximately $1,150,000, unpaid accounts receivable to Hydel Enterprises, Inc. of approximately $975,000 (Canadian Dollars), plus added sums in penalties, damages and attorneys fees. The court dismissed Nathan Mazurek on jurisdictional grounds and granted Plaintiff's motion to stay pending litigation in Delaware involving the related parties over the same issues.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

     (a)     NONE

     (b) Reports on Form 8-K.  -  NONE

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SIGNATURE

     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.

ELECTRIC & GAS TECHNOLOGY, INC.

Fred M. Updegraff

Vice President and Treasurer

Chief Accounting Officer

Dated: December 14, 2002

I, S. Mort Zimmerman, certify that:

     1. 1 have reviewed this quarterly report on Form 10-Q of Electric & Gas Technology, Inc.;

     2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

     3. Based on my knowledge, the consolidated financial statements, and other financial information included in this quarterly report, fairly present in all material respects the consolidated financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

     4. The registrant's other certifying officer and I am responsible for establishing and maintaining disclosure controls and procedures (as defined in the Exchange Act Rules 13a- 14 and 15d- 14) for the registrant and have:

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     5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):

     6. The registrant's other certifying officer and I have indicated in this quarterly report whether there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

Date: December 14, 2002

/s/ S. Mort Zimmerman

S. Mort Zimmerman

President and Chairman of the Board

I, Fred M. Updegraff, certify that:

     1. 1 have reviewed this quarterly report on Form 10-Q of Electric & Gas Technology, Inc.;

     2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

     3. Based on my knowledge, the consolidated financial statements, and other financial information included in this quarterly report, fairly present in all material respects the consolidated financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

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     4. The registrant's other certifying officer and I am responsible for establishing and maintaining disclosure controls and procedures (as defined in the Exchange Act Rules 13a- 14 and 15d- 14) for the registrant and have:

     5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):

     6. The registrant's other certifying officer and I have indicated in this quarterly report whether there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

Date: December 14, 2002

/s/ Fred M. Updegraff

Fred M. Updegraff

Vice President & Treasurer

Chief Accounting Officer

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