UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended March 31, 2003

[ ] 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 1-6659

PHILADELPHIA SUBURBAN CORPORATION
---------------------------------
(Exact name of registrant as specified in its charter)

Pennsylvania                                      23-1702594
-----------------------------------------                 ----------------------
(State or other jurisdiction of                        (I.R.S. Employer
incorporation or organization)                       Identification No.)

762 W. Lancaster Avenue, Bryn Mawr, Pennsylvania               19010 -3489
------------------------------------------------          ----------------------
(Address of principal executive offices)                   (Zip Code)

Registrant's telephone number, including area code:           (610)-527-8000
----------------------

________________________________________________________________________________
(Former Name, former address and former fiscal year,
if changed since last report.)

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 _______

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act).

Yes ___X___           No _______

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of April 29, 2003.

68,097,741.
----------

Part I - Financial Information
Item 1.  Financial Statements

PHILADELPHIA SUBURBAN CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands of dollars, except per share amounts)

March 31,   December 31,
2003          2002
----------    ----------        
Assets                                                (Unaudited)

Property, plant and equipment, at cost                                                  $1,859,062    $1,836,892
Less accumulated depreciation                                                              354,733       346,051
----------    ----------        
Net property, plant and equipment                                                    1,504,329     1,490,841
----------    ----------        
Current assets:
Cash and cash equivalents                                                                8,736         5,915
Accounts receivable and unbilled revenues, net                                          56,714        57,680
Inventory, materials and supplies                                                        5,138         4,555
Prepayments and other current assets                                                     2,234         2,758
----------    ----------        
Total current assets                                                                    72,822        70,908
----------    ----------        

Regulatory assets                                                                           87,783        88,175
Deferred charges and other assets, net                                                      25,781        23,391
Funds restricted for construction activity                                                  40,979        43,754
----------    ----------        
$1,731,694    $1,717,069
==========    ==========        
Liabilities and Stockholders' Equity
Stockholders' equity:
Common stock at $.50 par value, authorized 100,000,000 shares,
issued 70,235,460 and 70,067,784 in 2003 and 2002                              $   35,118    $   35,034
Capital in excess of par value                                                         320,521       317,871
Retained earnings                                                                      183,859       180,047
Minority interest                                                                          503           503
Treasury stock, 2,149,625 and 2,151,350 shares in 2003 and 2002                        (40,388)      (40,421)
Accumulated other comprehensive income                                                     110            63
----------    ----------        
Total stockholders' equity                                                             499,723       493,097
----------    ----------        

6.05% Series B cumulative preferred stock                                                      172           172
Long-term debt, excluding current portion                                                  580,841       582,910
Commitments                                                                                   -             -
Current liabilities:
Current portion of long-term debt                                                       23,889        34,265
Loans payable                                                                          137,230       115,113
Accounts payable                                                                        17,682        31,058
Accrued interest                                                                         9,588         9,269
Accrued taxes                                                                           18,840        14,500
Other accrued liabilities                                                               20,691        22,326
----------    ----------        
Total current liabilities                                                              227,920       226,531
----------    ----------       

Deferred credits and other liabilities:
Deferred income taxes and investment tax credits                                       189,189       187,300
Customers' advances for construction                                                    69,593        69,790
Other                                                                                   15,426        13,330
----------    ----------        
Total deferred credits and other liabilities                                           274,208       270,420
----------    ----------        

Contributions in aid of construction                                                       148,830       143,939
----------    ----------       
$1,731,694    $1,717,069
==========    ==========

See notes to consolidated financial statements on page 5 of this report.

1

PHILADELPHIA SUBURBAN CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
(In thousands, except per share amounts)

(UNAUDITED)

Three Months Ended
March 31,
-------     -------     
2003       2002
------      -------   

Operating revenues                                                              $80,489     $71,669

Costs and expenses:
Operations and maintenance                                                     30,664      27,285
Depreciation                                                                   11,347       9,893
Amortization                                                                      712         540
Taxes other than income taxes                                                   5,320       5,314
-------     -------     
48,043      43,032
-------     -------     

Operating income                                                                 32,446      28,637

Other expense (income):
Interest expense, net                                                          10,612       9,780
Allowance for funds used during construction                                     (376)       (386)
Gain on sale of other assets                                                      (55)       (349)
-------     -------     
Income before income taxes                                                       22,265      19,592
Provision for income taxes                                                        8,938       7,702
-------     -------     
Net income                                                                       13,327      11,890
Dividends on preferred stock                                                          3          15
-------     -------     
Net income available to common stock                                            $13,324     $11,875
=======     =======     

Net income                                                                      $13,327     $11,890
Other comprehensive income (loss), net of tax:
Unrealized gain on securities                                                      47         128
Reclassification adjustment for gains reported in net income                     -           (227)
-------     -------     
Comprehensive income                                                            $13,374     $11,791
=======     =======     

Net income per common share:
Basic                                                                         $  0.20     $  0.17
=======     =======     
Diluted                                                                       $  0.19     $  0.17
=======     =======     

Average common shares outstanding during the period:
Basic                                                                          67,977      68,451
=======     =======     
Diluted                                                                        68,586      69,300
=======     =======

See notes to consolidated financial statements on page 5 of this report.

2

PHILADELPHIA SUBURBAN CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CAPITALIZATION
(In thousands of dollars, except per share amounts)

March 31,  December 31,
2003         2002
----------   ---------
(Unaudited)

Stockholders' equity:
Common stock, $.50 par value                                                      $   35,118   $   35,034
Capital in excess of par value                                                       320,521      317,871
Retained earnings                                                                    183,859      180,047
Minority interest                                                                        503          503
Treasury stock                                                                       (40,388)     (40,421)
Accumulated other comprehensive income                                                   110           63
----------   ----------
Total stockholders' equity                                                                499,723      493,097
----------   ----------

6.05% Series B cumulative preferred stock                                                     172          172

Long-term debt:
First Mortgage Bonds secured by utility plant:
Interest Rate Range
0.00% to  2.49%                                                       16,428       18,009
2.50% to  2.99%                                                       14,918       14,052
3.00% to 3.49%                                                         3,713        4,733
3.50% to 3.99%                                                         3,200        3,200
4.00% to 4.99%                                                         8,135        8,135
5.00% to  5.49%                                                       90,930       90,955
5.50% to  5.99%                                                       76,260       86,260
6.00% to  6.49%                                                      126,360      126,360
6.50% to  6.99%                                                       52,000       52,000
7.00% to  7.49%                                                       58,000       58,000
7.50% to  7.99%                                                       23,000       23,000
8.00% to  8.49%                                                       17,497       17,497
8.50% to  8.99%                                                        9,000        9,000
9.00% to  9.49%                                                       53,054       53,054
9.50% to  9.99%                                                       44,142       44,637
10.00% to 10.50%                                                        6,000        6,000
----------   ----------
Total First Mortgage Bonds                                                                602,637      614,892
Notes payable, 6.05%, due 2006                                                                788          978

Installment note payable, 9%, due in equal annual payments through 2013                     1,305        1,305
----------   ----------
604,730      617,175
Current portion of long-term debt                                                          23,889       34,265
----------   ----------
Long-term debt, excluding current portion                                                 580,841      582,910
----------   ----------
Total capitalization                                                                   $1,080,736   $1,076,179
==========   ==========

See notes to consolidated financial statements on page 5 of this report.

3

PHILADELPHIA SUBURBAN CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOW
(In thousands of dollars)

(UNAUDITED)

Three Months Ended
March 31,
--------       --------     
2003           2002
--------       --------

Cash flows from operating activities:
Net income                                                                          $ 13,327       $ 11,890
Adjustments to reconcile net income to net
cash flows from operating activities:
Depreciation and amortization                                                      12,059         10,433
Deferred income taxes                                                               1,865          1,440
Gain on sale of other assets                                                          (55)          (349)
Net decrease in receivables, inventory and prepayments                                744          5,364
Net decrease in payables, accrued interest, accrued taxes
and other accrued liabilities                                                   (6,883)        (9,410)
Other                                                                              (1,511)           120
--------       --------     
Net cash flows from operating activities                                                 19,546         19,488
--------       --------     

Cash flows from investing activities:
Property, plant and equipment additions, including allowance
for funds used during construction of $376 and $386                                (24,001)       (24,955)
Acquisitions of water and wastewater systems                                             (11)        (2,739)
Proceeds from the sale of other assets                                                    60          1,659
Net decrease in funds restricted for construction activity                             2,775          7,232
Other                                                                                   (130)          (126)
--------       --------     
Net cash flows used in investing activities                                             (21,307)       (18,929)
--------       --------     

Cash flows from financing activities:
Customers' advances and contributions in aid of construction                           1,361          3,840
Repayments of customers' advances                                                       (742)        (1,509)
Net proceeds (repayments) of short-term debt                                          22,117         10,112
Proceeds from long-term debt                                                              24          1,014
Repayments of long-term debt                                                         (11,050)        (2,741)
Redemption of preferred stock                                                             (1)          (300)
Proceeds from issuing common stock                                                     2,665          3,142
Repurchase of common stock                                                              (105)          (428)
Dividends paid on preferred stock                                                         (3)           (15)
Dividends paid on common stock                                                        (9,512)        (9,064)
Other                                                                                   (172)        (1,034)
--------       --------     
Net cash flows from financing activities                                                  4,582          3,017
--------       --------     

Net increase in cash and cash equivalents                                                 2,821          3,576
Cash and cash equivalents at beginning of period                                          5,915          1,010     
--------       --------
Cash and cash equivalents at end of period                                             $  8,736       $  4,586
========       ========

See notes to consolidated financial statements on page 5 of this report.

4

PHILADELPHIA SUBURBAN CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of dollars, except per share amounts)
(UNAUDITED)

Note 1  Basis of Presentation
---------------------

The accompanying consolidated balance sheet and statement of
capitalization of Philadelphia Suburban Corporation ("PSC") at March 31,
2003, the consolidated statements of income and comprehensive income and
cash flow for the three months ended March 31, 2003 and 2002, are
unaudited, but reflect all adjustments, consisting of only normal
recurring accruals, which are, in the opinion of management, necessary
to present fairly the consolidated financial position, the consolidated
results of operations, and the consolidated cash flow for the periods
presented. Because they cover interim periods, the statements and
related notes to the financial statements do not include all disclosures
and notes normally provided in annual financial statements and,
therefore, should be read in conjunction with the PSC Annual Report on
Form 10-K for the year ended December 31, 2002. The results of
operations for interim periods may not be indicative of the results that
may be expected for the entire year.

Note 2  Water Rates
-----------

During the first three months of 2003, operating subsidiaries located in
Pennsylvania, Illinois, Ohio and Maine were granted rate increases,
representing seven rate adjustments, intended to increase total revenues
by approximately $5,600 on an annual basis. Revenues from the rate
increases realized in the first three months of 2003 were approximately
$1,250.

Note 3  Stockholders' Equity
--------------------

PSC reports other comprehensive income in accordance with Statement of
Financial Accounting Standards No. 130, "Reporting Comprehensive
Income." The following table summarizes the activity of accumulated
other comprehensive income:

2003      2002
-----     -----

Balance at January 1,                                    $ 63     $ 726
Unrealized holding gain arising during the period,
net of tax of $25 in 2003 and $68 in 2002          47       128
Less:  reclassification adjustment for gains included
in net income, net of tax of $122 in 2002          -       (227)
----     -----
Other comprehensive income (loss), net of tax            47       (99)
----     -----
Balance at March 31,                                     $110     $ 627
====     =====

5

PHILADELPHIA SUBURBAN CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of dollars, except per share amounts) (continued)
(UNAUDITED)

Note 4  Net Income per Common Share
---------------------------

Basic net income per common share is based on the weighted
average number of common shares outstanding. Diluted net
income per common share is based on the weighted average
number of common shares outstanding and potentially dilutive
shares. The dilutive effect of employee stock options is
included in the computation of Diluted net income per common
share. The following table summarizes the shares, in
thousands, used in computing Basic and Diluted net income per
common share:

Three Months Ended
March 31,
----------------      
2003      2002
------    ------      
Average common shares outstanding during
the period for Basic computation             67,977    68,451
Dilutive effect of employee stock options          609       849
------    ------      
Average common shares outstanding during
the period for Diluted computation           68,586    69,300
======    ======      

Note 5  Stock-Based Compensation
------------------------

PSC accounts for stock-based compensation using the intrinsic
value method in accordance with APB Opinion No. 25,
"Accounting for Stock Issued to Employees". Accordingly, no
compensation expense related to granting of stock options has
been recognized in the financial statements for stock options
that have been granted. Pursuant to the disclosure
requirements of SFAS No. 123, "Accounting for Stock-Based
Compensation," as amended by SFAS No. 148, pro forma net
income available to common stock and earnings per share are
presented in the following table as if compensation cost for
stock options was determined as of the grant date under the
fair value method:

Three Months Ended
March 31,
-------------------
2003        2002
-------     -------
Net income available to common stock:
As reported                                   $13,324     $11,875
Less: pro forma expense related to stock
options granted, net of tax effects          (405)       (317)
-------     -------
Pro forma                                     $12,919     $11,558
=======     =======

Basic net income per share:
As reported                                   $  0.20     $  0.17
Pro forma                                        0.19        0.17
Diluted net income per share:
As reported                                   $  0.19     $  0.17
Pro forma                                        0.19        0.17

The fair value of options at the date of grant was estimated
using the Black-Scholes option-pricing model.

6

PHILADELPHIA SUBURBAN CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of dollars, except per share amounts) (continued)
(UNAUDITED)

Note 6  Recent Accounting Pronouncements
--------------------------------

In July 2001, the Financial Accounting Standards Board ("FASB") approved
Statement of Financial Accounting Standards ("SFAS") No. 143,
"Accounting for Asset Retirement Obligations." SFAS No. 143 requires
that the fair value of a liability for an asset retirement obligation be
recognized in the period in which it is incurred. When the liability is
initially recognized, the carrying amount of the related long-lived
asset is increased by the same amount. Over time, the liability is
accreted to its present value each period, and the capitalized cost is
depreciated over the useful life of the related asset. Upon settlement
of the liability, PSC may settle the obligation for its recorded amount,
or an alternative amount, thereby incurring a gain or loss upon
settlement. The adoption of this statement as required on January 1,
2003 did not have a material impact on PSC's results of operations or
financial position.

In April 2002, the FASB approved SFAS No. 145, "Rescission of FASB
Statements No. 4, 44 and 64, Amendment of FASB Statement No. 13, and
Technical Corrections." SFAS No. 145, among other things, rescinds SFAS
No. 4, which required all gains and losses from the extinguishment of
debt to be classified as an extraordinary item and amends SFAS No. 13 to
require that certain lease modifications that have economic effects
similar to sale-leaseback transactions be accounted for in the same
manner as sale-leaseback transactions. PSC adopted this statement in the
first quarter of 2003 and it did not have a material impact on PSC's
results of operations or financial position.

In June 2002, the FASB approved SFAS No. 146, "Accounting for Costs
Associated with Exit or Disposal Activities." SFAS No. 146 requires the
recognition of costs associated with exit or disposal activities when
they are incurred rather than at the date of a commitment to an exit or
disposal plan. This statement replaces the previous accounting guidance
provided in Emerging Issues Task Force Issue No. 94-3, "Liability
Recognition for Certain Employee Termination Benefits and Other Costs to
Exit an Activity (including Certain Costs Incurred in a Restructuring)."
SFAS No. 146 is effective for exit or disposal activities that are
initiated after December 31, 2002. PSC adopted this standard in the
first quarter of 2003 and it did not have a material impact on PSC's
results of operations or financial position.

7

PHILADELPHIA SUBURBAN CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of dollars, except per share amounts) (continued)
(UNAUDITED)

In November 2002, the FASB issued FASB Interpretation No. 45,
"Guarantor's Accounting and Disclosure Requirements for Guarantees,
Including Indirect Guarantees of Indebtedness of Others," an
interpretation of SFAS No. 5, 57 and 107 and rescission of SFAS No. 34.
This interpretation clarifies the requirements of FASB Statement No. 5,
"Accounting for Contingencies" relating to the guarantor's accounting
for, and disclosure of, the issuance of certain types of guarantees. The
disclosure provisions of the interpretation are effective for financial
statements of periods ending after December 15, 2002. The provisions for
initial recognition and measurement are effective on a prospective basis
for guarantees that are issued or modified after December 31, 2002. PSC
adopted the accounting provisions of this standard in the first quarter
of 2003 and it did not have a material impact on PSC's results of
operations or financial position.

8

PHILADELPHIA SUBURBAN CORPORATION AND SUBSIDIARIES

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)
(In thousands of dollars, except per share amounts)

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

Forward-looking Statements
--------------------------

This Management's Discussion and Analysis of Financial Condition and Results of
Operations and other sections of this Quarterly Report contain, in addition to
historical information, forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. These forward-looking
statements address, among other things: our use of cash; projected capital
expenditures; liquidity; possible acquisitions and other growth ventures; the
expected completion dates for the AquaSource acquisition; the completion of
various construction projects; the projected effects of recent accounting
pronouncements; the final purchase price for and the financing of the purchase
of AquaSource; the projected annual value of rate increases, as well as
information contained elsewhere in this report where statements are preceded by,
followed by or include the words "believes," "expects," "anticipates," "plans"
or similar expressions. These statements are based on a number of assumptions
concerning future events, and are subject to a number of uncertainties and other
factors, many of which are outside our control. Actual results may differ
materially from such statements for a number of reasons, including the effects
of regulation, abnormal weather, changes in capital requirements and funding,
acquisitions and the approval of the AquaSource acquisition by governmental
authorities. We undertake no obligation to update or revise forward-looking
statements, whether as a result of new information, future events or otherwise.

General Information
-------------------

Philadelphia Suburban Corporation ("we" or "us"), a Pennsylvania corporation, is
the holding company for regulated utilities providing water or wastewater
services to approximately 2 million people in Pennsylvania, Ohio, Illinois, New
Jersey, Maine and North Carolina. Our two primary subsidiaries are Pennsylvania
Suburban Water Company ("PSW"), a regulated public utility that provides water
or wastewater services to approximately 1.3 million residents in the suburban
areas north and west of the City of Philadelphia and in 18 other counties in
Pennsylvania, and Consumers Water Company ("CWC"), a holding company for several
regulated public utility companies that provide water or wastewater service to
approximately 700,000 residents in various communities in Ohio, Illinois, New
Jersey and Maine. Other of our smaller subsidiaries provide water and wastewater
services in parts of Pennsylvania, North Carolina and Ohio. Some of our
subsidiaries provide wastewater services to a population of approximately 40,000
people in Pennsylvania, Illinois, New Jersey and North Carolina. In addition, we
provide water and wastewater service to approximately 45,000 people through
operating and maintenance contracts with municipal authorities and other parties
close to our operating companies' service territories. We are the largest
U.S.-based investor-owned water utility based on number of customers.

9

PHILADELPHIA SUBURBAN CORPORATION AND SUBSIDIARIES

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)
(In thousands of dollars, except per share amounts)

Financial Condition
-------------------

During the quarter, we had $24,001 of capital expenditures, repaid $742 of
customer advances for construction and repaid debt and made sinking fund
contributions and other loan repayments of $11,050. The capital expenditures
were related to improvements to treatment plants, new water mains and customer
service lines, the rehabilitation of existing water mains, hydrants and customer
service lines, in addition to well and booster improvements.

During the quarter, the proceeds from our short-term credit facilities, proceeds
from the issuance of common stock, internally generated funds and available
working capital were used to fund the cash requirements discussed above and to
pay dividends. At March 31, 2003, we had short-term lines of credit of $180,000,
of which $42,770, was available.

We entered into a purchase agreement with DQE, Inc. ("DQE") and AquaSource, Inc.
("AquaSource") dated July 29, 2002, as amended by Amendment No. 1 dated March 4,
2003, pursuant to which we agreed to acquire four operating water and wastewater
subsidiaries of AquaSource and assume selected, integrated operating and
maintenance contracts and related assets. The purchase agreement provides for a
target cash purchase price of approximately $205 million subject to various
adjustments. If the transaction is completed, we will purchase operating
utilities, including assets and franchises that serve approximately 130,000
water and wastewater customer accounts in 11 states, and selected water and
wastewater operating contracts that serve approximately 40,000 customers in
seven of these states. The acquisition is subject to certain regulatory
approvals, but does not require approval of the shareholders of DQE or PSC. We
expect to obtain the requisite regulatory approvals in mid-2003. It is our
intention to fund the acquisition at closing with cash from a combination of
short-term debt, long-term debt, the issuance of our common stock and/or an
instrument convertible into our common stock. The ultimate decision regarding
the funding of the acquisition will be based upon market conditions existing at
the time the acquisition is consummated.

Management believes that internally generated funds along with existing credit
facilities and the proceeds from the issuance of long-term debt and common stock
will be adequate to meet our financing requirements for the balance of the year
and beyond.

10

PHILADELPHIA SUBURBAN CORPORATION AND SUBSIDIARIES

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)
(In thousands of dollars, except per share amounts)

Results of Operations
---------------------

Analysis of First Quarter of 2003 Compared to First Quarter of 2002
-------------------------------------------------------------------

Revenues for the quarter increased $8,820 or 12.3% primarily due to increased
water rates granted to our Pennsylvania, New Jersey and Ohio operating
subsidiaries, increased water consumption, and additional water revenues
associated with the larger customer base due to acquisitions, offset partially
by the revenues associated with a water system sold in 2002 of $384.

Operations and maintenance expenses increased by $3,379 or 12.4% primarily due
to increased postretirement benefits expenses, additional operating costs
associated with acquisitions, higher maintenance expenses and increased
insurance expense. The postretirement benefits expense increase resulted
principally from higher pension costs. The increased maintenance expenses
resulted from an increased number of main breaks resulting from the relatively
harsh winter weather that was experienced in the first quarter of 2003.

Depreciation expense increased $1,454 or 14.7% reflecting the utility plant
placed in service since the first quarter of 2002, including the assets acquired
through system acquisitions.

Amortization increased $172 primarily due to the amortization of the costs
associated with, and other costs being recovered in, various rate filings.

Taxes other than income taxes increased by $6 or 0.1% as a result of an increase
in capital stock tax due to an increase in the base on which the tax is applied,
offset partially by a reduction in state taxes. The decrease in state taxes is a
result of a reduction in assessments.

Interest expense increased by $832 or 8.5% primarily due to additional
borrowings to finance on-going capital projects and acquisitions, offset
partially by decreased interest rates on borrowings.

Allowance for funds used during construction ("AFUDC") decreased by $10
primarily due to a decrease in the average balance of utility plant construction
work in progress, to which AFUDC is applied; offset partially by an increase in
the AFUDC rate as a result of tax-exempt borrowings for our multi-year
infrastructure rehabilitation plan.

Gain on sale of other assets decreased $294 due to a decrease in the gain on
sale of marketable securities of $349 as there were no marketable securities
sold in the first quarter of 2003, offset by an increase in the gain on the sale
of land realized of $55.

Our effective income tax rate was 40.1% in the first quarter of 2003 and 39.3%
in the first quarter of 2002. The change was due to a decrease in the
tax-deductible portion of our book expenses.

Net income available to common stock for the quarter increased by $1,449 or
12.2%, in comparison to the same period in 2002 primarily as a result of the
factors described above. On a diluted per share basis, earnings increased $.02
or 11.8% reflecting the change in net income and a 1.0% decrease in the average
number of common shares outstanding. The decrease in the number of shares
outstanding is primarily a result of shares repurchased in the fourth quarter of
2002, offset partially by the additional shares sold or issued through the
dividend reinvestment plan, and employee stock purchase plan and equity
compensation plan and shares issued in connection with acquisitions.

11

PHILADELPHIA SUBURBAN CORPORATION AND SUBSIDIARIES

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)
(In thousands of dollars, except per share amounts)

Impact of Recent Accounting Pronouncements
------------------------------------------

In July 2001, the Financial Accounting Standards Board ("FASB") approved
Statement of Financial Accounting Standards ("SFAS") No. 143, "Accounting for
Asset Retirement Obligations." SFAS No. 143 requires that the fair value of a
liability for an asset retirement obligation be recognized in the period in
which it is incurred. When the liability is initially recognized, the carrying
amount of the related long-lived asset is increased by the same amount. Over
time, the liability is accreted to its present value each period, and the
capitalized cost is depreciated over the useful life of the related asset. Upon
settlement of the liability, we may settle the obligation for its recorded
amount, or an alternative amount, thereby incurring a gain or loss upon
settlement. The adoption of this statement as required on January 1, 2003 did
not have a material impact on our results of operations or financial position.

In April 2002, the FASB approved SFAS No. 145, "Rescission of FASB Statements
No. 4, 44 and 64, Amendment of FASB Statement No. 13, and Technical
Corrections." SFAS No. 145, among other things, rescinds SFAS No. 4, which
required all gains and losses from the extinguishment of debt to be classified
as an extraordinary item and amends SFAS No. 13 to require that certain lease
modifications that have economic effects similar to sale-leaseback transactions
be accounted for in the same manner as sale-leaseback transactions. We adopted
this statement in the first quarter of 2003 and it did not have a material
impact on our results of operations or financial position.

In June 2002, the FASB approved SFAS No. 146, "Accounting for Costs Associated
with Exit or Disposal Activities." SFAS No. 146 requires the recognition of
costs associated with exit or disposal activities when they are incurred rather
than at the date of a commitment to an exit or disposal plan. This statement
replaces the previous accounting guidance provided in Emerging Issues Task Force
Issue No. 94-3, "Liability Recognition for Certain Employee Termination Benefits
and Other Costs to Exit an Activity (including Certain Costs Incurred in a
Restructuring)." SFAS No. 146 is effective for exit or disposal activities that
are initiated after December 31, 2002. We adopted this standard in the first
quarter of 2003 and it did not have a material impact on our results of
operations or financial position.

In November 2002, the FASB issued FASB Interpretation No. 45, "Guarantor's
Accounting and Disclosure Requirements for Guarantees, Including Indirect
Guarantees of Indebtedness of Others," an interpretation of SFAS No. 5, 57 and
107 and rescission of SFAS No. 34. This interpretation clarifies the
requirements of FASB Statement No. 5, "Accounting for Contingencies" relating to
the guarantor's accounting for, and disclosure of, the issuance of certain types
of guarantees. The disclosure provisions of the interpretation are effective for
financial statements of periods ending after December 15, 2002. The provisions
for initial recognition and measurement are effective on a prospective basis for
guarantees that are issued or modified after December 31, 2002. We adopted the
accounting provisions of this standard in the first quarter of 2003 and it did
not have a material impact on our results of operations or financial position.

12

PHILADELPHIA SUBURBAN CORPORATION AND SUBSIDIARIES

Item 3. Quantitative and Qualitative Disclosures About Market Risk
----------------------------------------------------------

We are subject to market risks in the normal course of business,
including changes in interest and equity prices. There have been no
significant changes in our exposure to market risks since December 31,
2002. Refer to Item 7A of the Company's Annual Report on Form 10-K for
the year ended December 31, 2002 for additional information.

Item 4. Controls and Procedures
-----------------------

Under the supervision and with the participation of our Chief Executive
Officer and Chief Financial Officer (our principal executive officer and
principal financial officer), we have evaluated the effectiveness of the
design and operation of our disclosure controls and procedures within 90
days of the filing date of this quarterly report. Based on that
evaluation, the Chief Executive Officer and Chief Financial Officer have
concluded that these disclosure controls and procedures are effective.
There were no significant changes in our internal controls or in other
factors that could significantly affect these controls subsequent to the
date of the evaluation.

13

PHILADELPHIA SUBURBAN CORPORATION AND SUBSIDIARIES

Part II. Other Information

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

There are no pending legal proceedings to which we or any of our
subsidiaries is a party or to which any of their properties is the
subject that are expected to have a material effect on our financial
position, results of operations or cash flows.

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

(a) Exhibits

Exhibit No.          Description
-----------          -----------

99.1                 Certification Pursuant to 18 U.S.C. Section
1350, as Adopted Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002

99.2                 Certification Pursuant to 18 U.S.C. Section
1350, as Adopted Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002

(b) Reports on Form 8-K

Current Report on Form 8-K filed on January 14, 2003, responding to
Item 5, Other Events. (Related to the Company's previous filing of a
Registration Statement on Form S-4 on December 22, 1999 and the
result of applying the Company's 5-for-4 common stock splits
effected in the form of stock dividends distributed on December 1,
2001 and on December 1, 2000).

14

SIGNATURES

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

May 7, 2003

PHILADELPHIA SUBURBAN CORPORATION
---------------------------------
Registrant

/s/    Nicholas DeBenedictis
---------------------------------
Nicholas DeBenedictis
Chairman and President

/s/    David P. Smeltzer
-----------------------------------
David P. Smeltzer
Senior Vice President - Finance
and  Chief Financial Officer

15

CERTIFICATIONS

I, Nicholas DeBenedictis, Chairman, President and Chief Executive Officer of
Philadelphia Suburban Corporation, certify that:

1.   I have reviewed this quarterly report on Form 10-Q of Philadelphia Suburban
Corporation;

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 financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the 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 are responsible for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

a)   designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities,
particularly during the period in which this quarterly report is being
prepared;

b)   evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the "Evaluation Date"); and

c)   presented in this quarterly report our conclusions about the effectiveness
of the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;

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 function):

a)   all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and

b)   any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
controls; and

6.   The registrant's other certifying officer and I have indicated in this
quarterly report whether or not 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: May 7, 2003
/s/ Nicholas DeBenedictis
------------------------------------------
Nicholas DeBenedictis
Chairman, President and Chief Executive Officer

I, David P. Smeltzer, Senior Vice President - Finance and Chief Financial
Officer of Philadelphia Suburban Corporation, certify that:

1.   I have reviewed this quarterly report on Form 10-Q of Philadelphia Suburban
Corporation;

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 financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the 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 are responsible for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

a)   designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities,
particularly during the period in which this quarterly report is being
prepared;

b)   evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the "Evaluation Date"); and

c)   presented in this quarterly report our conclusions about the effectiveness
of the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;

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 function):

a)   all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and

b)   any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
controls; and

6.   The registrant's other certifying officer and I have indicated in this
quarterly report whether or not 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: May 7, 2003
/s/  David P. Smeltzer
-----------------------------------
David P. Smeltzer
Senior Vice President - Finance and
Chief Financial Officer

EXHIBIT INDEX

Exhibit No.                                Description                
-----------                                -----------

99.1               Certification Pursuant to 18 U.S.C. Section 1350, as
Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002

99.2               Certification Pursuant to 18 U.S.C. Section 1350, as
Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002

Exhibit 99.1

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q for the period ended March
31, 2003 of Philadelphia Suburban Corporation (the "Company") as filed with the
Securities and Exchange Commission on the date hereof (the "Report"), I,
Nicholas DeBenedictis, Chief Executive Officer of the Company, certify, pursuant
to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, that:

(1)  The Report fully complies with the requirements of section 13(a) or 15(d)
of the Securities Exchange Act of 1934 (15 U.S.C. Section 78m(a) or Section
78o(d)); and

(2)  The information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the Company.

/s/  Nicholas DeBenedictis               
-----------------------------------
Nicholas DeBenedictis
Chairman, President and Chief Executive Officer
May 7, 2003

Exhibit 99.2

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q for the period ended March
31, 2003 of Philadelphia Suburban Corporation (the "Company") as filed with the
Securities and Exchange Commission on the date hereof (the "Report"), I, David
P. Smeltzer, Chief Financial Officer of the Company, certify, pursuant to 18
U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002, that:

(1)  The Report fully complies with the requirements of section 13(a) or 15(d)
of the Securities Exchange Act of 1934 (15 U.S.C. Section 78m(a) or Section
78o(d)); and

(2)  The information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the Company.

/s/  David P. Smeltzer                     
-------------------------------------
David P. Smeltzer
Senior Vice President - Finance and Chief Financial Officer
May 7, 2003