<PAGE>

                                   FORM 10-Q

                      SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, DC 20549

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE SECURITIES
    EXCHANGE ACT OF 1934 FOR THE PERIOD ENDED SEPTEMBER 30, 1997

                                      OR

[  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
     EXCHANGE ACT OF 1934

        For the transition period from         to
                                       -------    ---------
Commission file number 0-27604

                           PICK Communications Corp.
          (Exact name of the registrant as specified in its charter)

        NEVADA                                                   75-2107261
-------------------------------                             -------------------
(State or other jurisdiction of                              (I.R.S. employer
Incorporation or Organization)                              identification no.)

155 Route 46, West, Third Floor
Wayne Interchange Plaza II
Wayne,  NJ                                                          07470
----------------------------------------                          ----------
(Address of principal executive offices)                          (Zip code)

Registrant's Telephone number, including area code:  (973) 812-7425

Indicate by check mark whether the registrant (1) has filed reports to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for 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 the number of shares  outstanding of each of the issuer's  classes of
common stock, as of the latest practicable date.

               Class                             Outstanding at October 31, 1997
        Common Stock, $.001 Par Value                        36,059,817

(See Index to Sections of this Document on Page 2)


<PAGE>

                           PICK Communications Corp.


                               Index to Form 10Q



Part I  Financial Statements
----------------------------

Item 1: Financial Statements.................................................. 3

        Consolidated Balance Sheets
         at  December 31, 1996 and September 30, 1997......................... 4

        Consolidated Statements of Operations - Three months and nine months
          ended September 30, 1996 and September 30, 1997..................... 5
        

        Consolidated Statement of Stockholders' Equity - Nine months
          ended September 30, 1997 ........................................... 6

        Consolidated Statements of Cash Flows - Nine months
          ended September 30, 1996 and September 30, 1997..................... 7

        Notes to Consolidated Financial Statements............................ 9


Item 2: Management's Discussion and Analysis of Financial Condition and
          Results of Operations...............................................12

Part II Other Information:
--------------------------

        Items 1-6  Other Information..........................................15
 

        Signatures............................................................16








                                      2
<PAGE>


Part I - Financial Information


Item 1 - Financial Statements:

The financial statements for the three and nine months ended September
30, 1997 and 1996 are derived from the consolidation of the PICK
Communications Corp. (the "Company"), Public Info/CommKiosk, Inc. ("PICK"),
PICKNET, Inc. ("PICKNET") and P.C.T. Prepaid Telephone Inc. ("PCT").



                                      3



<PAGE>



                           PICK Communications Corp.
                          Consolidated Balance Sheets
                   December 31, 1996 and September 30, 1997
<TABLE>
<CAPTION>
                                                                               1996                  1997
                                                                         -----------------     -----------------
                                 ASSETS                                                           (Unaudited)
<S>                                                                             <C>                <C>
CURRENT ASSETS:
      Cash                                                              $         87,712       $        35,245
      Accounts receivable, net                                                   778,180             1,096,774
      Prepaid telephone card inventory                                            23,914                 8,732
      Prepaid advertising                                                      2,458,155                     0
      Prepaid expenses and other current assets                                   82,252               168,567
                                                                         -----------------     -----------------
           Total current assets                                                3,430,213             1,309,318
                                                                         -----------------     -----------------

PROPERTY AND EQUIPMENT:
      Furniture and equipment, net                                                90,571                77,950
                                                                         -----------------     -----------------
           Total property and equipment                                           90,571                77,950
                                                                         -----------------     -----------------

OTHER ASSETS:
      Security deposits                                                                0                11,796
      Prepaid cellular patent and rights, net                                    583,705               476,830
      Purchased goodwill                                                               0             2,789,968
      Investment in marketable equity securities, net                          4,812,660             1,631,180
                                                                         -----------------     -----------------
           Total other assets                                                  5,396,365             4,909,774
                                                                         -----------------     -----------------
Total assets                                                             $     8,917,149       $     6,297,042
                                                                         =================     =================

                  LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
      Accounts payable                                                    $    1,072,052       $     4,005,751
      Accrued expenses and other current liabilities                           1,318,274               618,535
      Advances from stockholder                                                   25,152               170,000
      Reserve for contingent liability                                         1,749,563             1,100,000
      Deferred revenue                                                         1,667,388               897,854
      Borrowings under line of credit                                            750,000               750,000
                                                                         -----------------     -----------------
           Total current liabilities                                           6,582,429             7,542,140
                                                                         -----------------     -----------------

Minority interest in consolidated subsidiary                                   1,465,141               108,865
                                                                         -----------------     -----------------

STOCKHOLDERS' EQUITY (DEFICIT)
      Common stock, $0.002 par value at December 31, 1996, $0.001
         par value at September 30, 1997; authorized:  75,000,000
         shares; 43,697,516 issued and 43,217,516 outstanding at 
         December 31, 1996; 43,325,317 issued and 36,059,817 
         outstanding at September 30, 1997                                        87,395                43,325
      Additional paid in capital in excess of par                              6,399,720             5,886,825
      Stock subscription receivable                                             (600,000)                    0
      Treasury stock                                                            (602,089)           (4,802,534)
      Marketable equity securities valuation reserve                          (3,904,965)           (2,503,820)
      Retained earnings (deficit)                                               (510,482)               22,241
                                                                         -----------------     -----------------
           Total stockholders' equity (deficit)                                  869,579            (1,353,963)
                                                                         -----------------     -----------------
Total liabilities and stockholders' equity                               $     8,917,149       $     6,297,042
                                                                         =================     =================
</TABLE>

             The accompanying notes are an integral part of these
                            financial statements.

                                      4
<PAGE>



                           PICK Communications Corp.
                     Consolidated Statements of Operations
                                  (UNAUDITED)
<TABLE>
<CAPTION>
                                                    3 months ended Sept. 30            9 months ended Sept. 30
                                                 -------------------------------    -------------------------------
                                                     1996             1997              1996             1997
                                                 --------------  ---------------    --------------   --------------
<S>                                                   <C>              <C>               <C>               <C>
          Revenue
Sales - prepaid telephone calling cards          $    315,631     $    541,272      $  1,490,624     $  1,093,947
Sales - long distance services                      3,125,424        1,754,431         3,680,648        6,496,645
                                                 --------------  ---------------    --------------   --------------
    Total sales                                     3,441,055        2,295,703         5,171,272        7,590,592

Provision for contingent costs                        904,000         (649,563)          904,000         (649,563)
Other cost of sales                                 3,329,525        2,219,887         5,353,220        7,363,240
                                                 --------------  ---------------    --------------   --------------
    Total cost of sales                             4,233,525        1,570,324         6,257,220        6,713,677
                                                 --------------  ---------------    --------------   --------------
    Gross profit (loss)                              (792,470)         725,379        (1,085,948)         876,915
                                                 --------------  ---------------    --------------   --------------

Sales - prepaid cellular licenses                           0                0         3,650,000                0

          Operating expenses
Sales and marketing - related party                    37,309                0            79,645                0
Sales and marketing - other                           386,105            3,839           531,643           40,434
                                                 --------------  ---------------    --------------   --------------
     Total sales and marketing                        423,414            3,839           611,288           40,434

General and administrative                            320,616          470,242         1,218,145        1,346,707
Depreciation                                           11,090            6,417            27,672           19,133
Amortization                                           35,625          139,007           106,875          210,171
Bad debt                                              303,243           13,089           389,921           78,766
                                                 --------------  ---------------    --------------   --------------
      Total operating expenses                      1,093,988          632,594         2,353,901        1,695,211
                                                 --------------  ---------------    --------------   --------------

Income (loss) from operations                      (1,886,458)          92,785           210,151         (818,296)
Interest (income) expense                                (127)          16,597              (782)          46,793
                                                 --------------  ---------------    --------------   --------------

Income (loss) before taxes, minority interest in
   subsidiary loss and other gains (losses)        (1,886,331)          76,188           210,933         (865,089)
Gain on in-substance defeasance                        53,080                0            53,080                0
Gain (loss) on sale of marketable equity
   securities                                               0                0         4,784,000         (748,625)
                                                 --------------  ---------------    --------------   --------------

Income (loss) before taxes and minority interest
    in subsidiary loss                             (1,833,251)          76,188         5,048,013       (1,613,714)
Minority interest in subsidiary loss                   17,787            2,056            36,932          338,437
Provision for deferred income tax (benefit)                 0                0         1,808,000       (1,808,000)
                                                 --------------  ---------------    --------------   --------------

Net income (loss)                                 $(1,815,464)   $      78,244      $  3,276,945          532,723
                                                 ==============  ===============    ==============   ==============

Net income (loss) per share                      $      (0.04)   $        0.00      $       0.08     $       0.01
                                                 ==============  ===============    ==============   ==============
Weighted average number of shares outstanding      42,775,559       36,013,717        42,829,377       37,261,393
                                                 ==============  ===============    ==============   ==============


</TABLE>


              The accompanying notes are an integral part of the
                            financial statements.
 
                                     5
<PAGE>


                           PICK Communications Corp.
                Consolidated Statement of Stockholders' Equity
                                  (UNAUDITED)
<TABLE>
<CAPTION>
                                                                     Marketable
                                         Additional      Stock       Securities                   Retained        Total
                            Common        Paid in    Subscription    Valuation      Treasury      Earnings    Stockholders'
                             Stock        Capital      Receivable     Reserve        Stock        (Deficit)      Equity
                          -------------   ----------- --------------  ------------ -------------  ----------  --------------
         <S>                  <C>           <C>           <C>           <C>           <C>            <C>           <C>
BALANCE, January 1, 
1997:

                  A)     $      87,395   $ 6,399,720  $   (600,000)  $(3,904,965)  $  (602,089)    $(510,482)  $   869,579

Capital transactions:
                  B)           (43,697)       43,697             0             0             0             0             0
                  C)              (600)     (599,400)      600,000             0             0             0             0
                  D)                 0             0             0             0    (2,038,155)            0    (2,038,155)
                  E)                 0             0             0             0       (11,978)            0       (11,978)
                  F)                 0             0             0     3,570,762    (2,150,312)            0     1,420,450
                  G)               227        42,808             0             0             0             0        43,035

Other changes:
                  H)                 0             0             0    (1,808,000)            0             0    (1,808,000)
                  I)                 0             0             0      (361,617)            0             0      (361,617)

Net income                           0             0             0             0             0       532,723       532,723
                         --------------   ----------- --------------  ------------ -------------  ----------  -------------
BALANCE, September 30, 
1997:
                         $      43,325   $ 5,886,825  $          0   $(2,503,820) $ (4,802,534)       22,241   $(1,353,963)
                         ==============   =========== ==============  ============ =============  ==========  =============
</TABLE>

A) 43,697,516 shares issued and 43, 217,516 shares outstanding.
B) Reduction in par value from $0.002 to $0.001 per share.  
C) Cancellation of 600,000 shares subscribed. 43,097,516 shares issued and 
   42,617,516 shares outstanding.
D) 750,000  shares the  Company's  common  stock  received  in return  for  
   $2,038,155  (book  value) of prepaid  advertising.  43,097,516 shares issued 
   and 41,867,516 shares outstanding.
E) Purchased  35,500 shares of the Company's  common stock for $11,978.  
   43,097,516 shares issued and 41,832,016 shares outstanding.
F) Transactions  involving the disposition of the common stock of  Firenze  Ltd.
   and  Ultimistics,  Inc.  See Note 4.  43,097,516  shares issued and 
   35,832,016 shares outstanding.
G) Shares issued as  compensation to employees and others.  43,325,317  shares
   issued and 36,059,817 shares outstanding.
H) Reversal of deferred income tax liability.  See Note 2.
I) Adjustment  to  marketable   securities  valuation  reserve related to 
   investment in the common stock of Jet Vacations, Inc.



              The accompanying notes are an integral part of the
                             financial statements.

                                      6
<PAGE>


                          PICK Communications Corp.
                    Consolidated Statements of Cash Flows
                       Nine months ended September 30,
                                 (UNAUDITED)
<TABLE>
<CAPTION>

                                                                                1996                1997
                                                                          -----------------   -----------------
<S>                                                                           <C>                 <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income                                                                $      3,276,945    $       532,723
Adjustments to reconcile net income (loss) to cash used in  
     operating activities:
 Non-cash revenues - prepaid cellular license revenue                           (3,650,000)                 0
 Non-cash (gain) loss on sale of marketable equity securities                   (4,784,000)           748,625
 Minority interest in consolidated subsidiary loss                                 (36,932)          (338,437)
 Non-cash gain on in-substance defeasance                                          (53,080)                 0
 Non-cash expenses - prepaid advertising                                           256,845                  0
 Depreciation and amortization                                                     134,547            229,304
 Bad debt expense                                                                  389,921             78,766
 Stock issued for services                                                          50,000             43,035
 Reserve for contingent liabilities                                                904,000           (649,563)
 Changes in operating assets and liabilities:
   (Increase) decrease in accounts receivable                                     (767,141)          (396,775)
   (Increase) decrease in prepaid telephone card inventory                          79,803             15,182
   (Increase) decrease in prepaid and other assets                                (117,439)           (98,111)
   Increase (decrease) in accounts payable                                       1,234,633          2,933,699
   Increase (decrease) in accrued expenses and other current                       
     liabilities                                                                   214,657           (699,739)
   Increase (decrease) in deferred revenue                                         643,076           (769,534)
   Increase (decrease) in deferred income taxes payable                          1,808,000         (1,808,000)
                                                                          -----------------   -----------------
Net cash provided by (used in) operating activities                               (416,165)          (178,825)
                                                                          -----------------   -----------------

CASH FLOWS FROM INVESTING ACTIVITIES:
Investments in debt securities                                                    (371,920)                 0
Purchase of fixed assets                                                           (61,632)            (6,512)
                                                                          -----------------   -----------------
Net cash (used in) investing activities                                           (433,552)            (6,512)
                                                                          -----------------   -----------------

CASH FLOWS FROM FINANCING ACTIVITIES:
Common stock issued for cash                                                       125,000                  0
Acquisition of treasury stock for cash                                             (44,500)           (11,978)
Common stock of subsidiary issued for cash                                         527,612                  0
Payments received on stock subscriptions receivable                                325,000                  0
Funds advanced by stockholder                                                       50,000            170,000
Payments on stockholder advances                                                   (50,000)           (25,152)
Payments on third-party debt                                                       (50,000)                 0
                                                                          -----------------   -----------------
Net cash provided by (used in) financing activities                                883,112            132,870
                                                                          -----------------   -----------------

Net increase (decrease) in cash                                                     33,395            (52,467)
CASH, beginning of period                                                          110,715             87,712
                                                                          -----------------   -----------------
CASH, end of period                                                       $        144,110    $        35,245
                                                                          =================   =================
</TABLE>







              The accompanying notes are an integral part of the
                            financial statements.

                                      7
<PAGE>



                          PICK Communications Corp.
                    Consolidated Statements of Cash Flows
                       Nine months ended September 30,
                                 (UNAUDITED)
                                  (Continued)
<TABLE>
<CAPTION>

                                                                                1996                1997
                                                                          -----------------   -----------------
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
<S>                                                                        <C>                        <C>
Interest paid in cash                                                     $              0    $        46,793
                                                                          =================   ================
Stock issued for investment in marketable equity securities               $      2,075,000    $             0
                                                                          =================   =================
Stock issued to acquire prepaid advertising                               $      2,700,000    $             0
                                                                          =================   =================
Stock issued for subscription receivable                                  $        125,000    $             0
                                                                          =================   =================
In substance defeasance                                                   $        425,000    $             0
                                                                          =================   =================
Prepaid advertising and telephone cards exchanged for stock of the
    Company                                                               $        557,589    $             0
                                                                          =================   =================
Prepaid advertising exchanged for stock of the Company and its
    consolidated subsidiary                                               $              0    $     2,458,155
                                                                          =================   =================
Marketable equity securities exchanged for stock of the Company and
   its consolidated subsidiary                                            $              0    $     5,642,313
                                                                          =================   =================


</TABLE>


              The accompanying notes are an integral part of the
                            financial statements.

                                      8
<PAGE>


                           PICK Communications Corp.
                  Notes to Consolidated Financial Statements
                                  (UNAUDITED)


(1)   Summary of significant accounting principles. The financial
      statements have been prepared in conformity with generally accepted
      accounting principles. In preparing the financial statements, management
      is required to make estimates and assumptions that affect the reported
      amounts of assets and liabilities as of the dates of the statements of
      financial condition and revenues and expenses for the periods then
      ended. The financial statements for the three and nine months ended
      September 30, 1996 and 1997 include all adjustments which in the opinion
      of management are necessary for fair presentation.

      Certain amounts in the accompanying financial statements have been
      reclassified from the presentation in previously-issued financial
      statements to conform with the presentation at September 30, 1997.

      In the first quarter of 1997, in three separate transactions, the
      Company transferred, to unrelated third parties, 2,800,000 shares of
      restricted common stock of Ultimistics, Inc., which had a book value, to
      the Company, of $5,600,000, and $420,000 of prepaid advertising. In
      return, the Company received 1,000,000 shares of its common stock and
      10,000,000 shares of the common stock of one of its subsidiaries. The
      Company accounted for these transactions based upon its basis in the
      Ultimistics shares, resulting in the Company's recording of goodwill in
      the amount of $2,893,000 and treasury stock in the amount of $2,150,000.
      If the Company had accounted for these transactions based upon either
      (i) the market value of the Company's shares and the book value of the
      subsidiary's shares at the dates of the transactions or (ii) the market
      value of the Ultimistics shares at the dates of the transactions, the
      Company would have recorded no goodwill and would have reflected an
      additional, non-cash loss on disposition of securities of approximately
      $4,900,000 in its statements of operations for the three months ended
      March 31, 1997 and the nine months ended September 30, 1997.

(2)   Income taxes. In the first quarter of 1997, the Company determined
      it had no income tax liability; therefore, it reversed a
      previously-provided deferred income tax liability of $1,808,000.

(3)   Concentration of credit risk. Three customers accounted for
      approximately 33.6%, 25.6%, and 13.5% of net sales for the nine months
      ended September 30, 1996 and approximately 12.9%, 8.1%, and 47.9% of
      accounts receivable at September 30, 1996. Two customers accounted for
      approximately 22.7% and 14.2% of net sales for the nine months ended
      September 30, 1997; three customers accounted for approximately 16.9%,
      16.2% and 15. 0% of the accounts receivable at September 30, 1997. The
      Company performs periodic credit evaluations of its customers, but
      generally does not require collateral.

(4)   Stockholders' equity. In February 1997, the Company exchanged
      $2,550,000 face amount of the prepaid advertising with IES for 750,000
      shares of its common stock, previously issued into escrow for IES. In
      February 1997, the Company exchanged (with Firenze Ltd.) 5 million
      shares of Firenze common stock for 5 million shares of the Company's
      common stock and 6.25 million shares of PCT common stock. In February
      1997, the Company exchanged (with New Century Media Inc.) 1 million
      shares of Ultimistics Inc. common stock for 1 million shares of the
      Company's common stock and 1 million shares of PCT common stock. In
      March 1997, the Company exchanged (with Yakimoto Investment Ltd.) 1.5
      million shares of Ultimistics Inc. common stock for 4 million shares of
      PCT common stock. In March 1997, the Company exchanged (with an
      unaffiliated third party) 300,000 shares of Ultimistics Inc. common
      stock and the balance of the Company's prepaid advertising for 5 million
      shares of PCT common stock. In March 1997, the Company repurchased
      35,500 shares of its common stock in open market purchases at an average
      price of $0.337 per share, or a total of $11,978. The cumulative total
      of the Treasury stock acquisitions by the Company is $4.2 million.

                                      9
<PAGE>



                           PICK Communications Corp.
                  Notes to Consolidated Financial Statements
                                  (UNAUDITED)

(5)   Commitments. The Company entered into a 63 month operating lease for
      the Company's facilities in June 1996. This lease provides for three
      months free rent and a renewal option for five additional years. Future
      minimum lease payments under this operating lease are $8,620 per month,
      or $103,441 per year. Rent expense for the nine months ended September
      30, 1996 and 1997 was $16,015 and $77,580, respectively.

      The Company has entered into two, three-year, space leases commencing
      October 1, 1997 and two, five-year equipment leases commencing when the
      equipment has been installed and tested. Rent under the two space leases
      is $18,600 per month ($223,200 per year and $669,600 in total). Rent
      under the two equipment leases is $20,640 per month ($247,675 per year
      and $1,238,379 in total).

(6)   Notes payable. In November 1996, the Company received a $ 750,000
      line of credit form Banco Popular, which the Company had drawn down
      completely. This line of credit is payable December 31, 1997, carries an
      interest rate of prime rate plus 2% and is secured by accounts
      receivable and 200,000 shares of Jet Vacations, Inc. common stock.

(7)   Related Party Transactions. The Company purchased $79,645
      advertising services during the nine months ended September 30, 1996
      from an entity controlled by an individual who is a stockholder and a
      member of the Board of Directors.

(8)   Investment in marketable equity securities. In March 1997, the
      Company exchanged with Fairbanks, Inc. 1.9 million shares of Ultimistics
      common stock for 380,000 shares of Fairbanks common stock. The Company
      believes that by completing this exchange it will eventually realize the
      value in the underlying Ultimistics common stock, which, as a minority
      shareholder of Ultimistics, might not have been possible.

      At September 30, 1997, the Company's investment in marketable equity
      securities consists of 500,000 shares of Internet Channel, Inc. valued
      at $50,000 and 380,000 shares of Jet Vacations, Inc., (f/k/a/ Fairbanks,
      Inc.). The 380,000 shares of Jet Vacations, which are restricted until
      March, 1998, have a market value of $5,270,600 at September 30, 1997.
      Because of the restrictions and the limited trading activity in the
      shares of Jet Vacations, the Company valued these shares at 30% of the
      market price, or $1,581,180. The difference between this and the
      Company's basis of $4,085,000 is reflected in the valuation reserve of
      $2,503,820.

(9)   Statement of Financial Accounting Standards not yet evaluated. In
      February, 1997, the Financial Accounting Standards Board issued
      Statements of Financial Accounting Standards ("SFAS") number 128
      ("Earnings per Share") and number 129 ("Disclosure of Information about
      Capital Structure"). The Company will have to implement SFAS 128 and 129
      in its financial statements for the year ended December 31, 1997. The
      provisions of SFAS 128 change the presentation and calculation of
      earnings per share. The Company has not evaluated the impact, if any,
      of the provisions of SFAS 128 and 129.

(10)  Revocation of prepaid cellular marketing rights. In February 1997,
      the Company revoked all the prepaid cellular marketing licenses
      previously granted to Firenze Ltd. and Yakimoto Investments Ltd.

(11)  Reserve for contingent liability. In February, 1996, the Company
      entered into a long-term contract with American Telephone & Telegraph
      Company ("AT&T") to purchase long distance time at favorable rates.
      Based upon the rate schedule provided to the Company during the
      negotiations, the Company began selling bulk time at prices slightly
      above its expected cost. AT&T actually invoiced the time at a rate
      significantly higher than the schedule provided. The Company provided a
      contingency reserve of $904,000 in the third quarter of 1996 and an
      additional $845,563 in the fourth quarter of 1996. In the course of
      further discussions concerning the dispute, AT&T has indicated that, in
      its opinion, the balance due is slightly less than $1,100,000. Based
      upon this, in the third quarter of 1997, the Company has reduced the
      reserve to $1,100,000 and credited cost of sales for this $649,563
      reduction in the reserve.


                                      10


<PAGE>


                           PICK Communications Corp.
                  Notes to Consolidated Financial Statements
                                  (UNAUDITED)



(12)  Stock option plan. In February, 1996, the Company adopted a stock
      option plan for employees and directors. The following summarizes
      activity under the plan:
<TABLE>
<CAPTION>
                                               Nine Months Ended                       Nine Months Ended
                                               September 30, 1996                     September 30, 1997
                                           --------------------------            --------------------------
                                                        Weighted Average                       Weighted Average
                                        Shares           Exercise Price         Shares          Exercise Price
                                       ----------       ---------------       ----------       ----------------
<S>                                      <C>                <C>                 <C>                 <C>
Outstanding at beginning of period              0                 -            3,500,000             $ 0.878
  
Options canceled                                0                 -           (3,500,000)            $ 0.878

Granted                                 3,500,000           $ 0.878            4,500,000             $ 0.230
                                       ----------                             ----------                         
                                         
Outstanding at end of period            3,500,000           $ 0.878            4,500,000             $ 0.230
                                       ==========                             ==========
</TABLE>
(13)  Working capital deficiency. The accompanying consolidated financial
      statements have been prepared assuming that the Company will continue as
      a going concern, which contemplates the realization of assets and the
      satisfaction of liabilities in the normal course of business. As shown
      in the previously filed consolidated financial statements, the Company
      incurred operating losses in each of the years ended December 31, 1994,
      1995 and 1996. For the nine months ended September 30, 1997, the Company
      recorded an operating loss of $818,296. At September 30, 1997, the
      Company has a working capital deficit of $6,232,822 and negative
      tangible net worth (total stockholders' equity less the net book value
      of intangible assets) of $4,620,761.

      The Company believes that profitability from the sale of telephone time
      can best be achieved by having sufficient capacity to properly serve
      existing customer requirements and by attracting more customers. This,
      in turn, will enable the Company to purchase increasing numbers of
      telephone minutes, resulting in more favorable purchase pricing.
      Upgraded technical performance of the telephone switches which process
      the Company's traffic should also encourage increased traffic volume and
      customer satisfaction. To that end, the Company has leased two Siemens
      Stromberg-Carlson central office telephone switches which are currently
      being installed in Miami and Jersey City.

      In addition, utilizing these central office switches will permit the
      Company to pursue direct-connect international agreements for long
      distance termination, which has the potential to improve PICK's pricing
      structure dramatically in these areas.

      These changes also allow the Company to structure the calling costs on
      PICK's prepaid telephone calling cards sold at retail in a manner which
      should result in increased retail sales. Overall, the Company believes
      it will be able to generate operating income in the future.

      The Company has signed a best efforts private placement agreement with
      Kaufman Bros., L.P. to raise $5 million in equity or debt. The Company
      is also pursuing other sources of capital. While the Company believes it
      will be successful in its efforts to raise sufficient capital and to
      restructure its operations so that it may continue as a going concern,
      there can be no assurance that the Company will be successful.


                                      11
<PAGE>



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

This Report includes forward-looking statements that involve risks and 
uncertainties, including the timely development and acceptance of new products 
in a constantly evolving telecommunications industry, the impact of competitive 
products and pricing, government regulations and the other risks detailed from 
time to time in the Company's SEC reports.

Results of Operations:

The Company generates revenues from the sale of international long distance
service to carriers and resellers, and from the sale of prepaid telephone
calling cards to retail outlets. This latter revenue is deferred when the
cards are sold and is recognized when the telephone service is actually
provided.

Nine Months Ended September 30, 1997 Compared with September 30, 1996

Total revenues excluding cellular license revenues, amounted to $7,590,592 for
the nine months ended September 30, 1997 compared to $5,171,272 for the nine
months ended September 30, 1996. This represents an increase of $2,419,320 or
47%. For the nine months ended September 30, 1997, the Company generated
international long distance revenue of $6,496,645 compared to $3,680,648 for
nine months ending September 30, 1996; the international long distance
business began in May of 1996. Prepaid telephone calling card revenues were
$1,093,947 for the nine months ended September 30, 1997, compared to
$1,490,624 for the nine months ended September 30, 1996. This represents a
decrease of $396,677 or 27%. This decrease reflects market changes which have
resulted in product returns and reductions in repeat sales of calling cards.
There were no prepaid cellular license revenues during the nine months ended
September 30, 1997 compared to $ 3,650,000 in license revenues for the nine
months ended September 30, 1996. The cellular license revenues for 1996 were
non-cash transactions which resulted in the acquisition of restricted shares
of marketable securities.

The direct costs of international long distance and calling card services
amounted to $6,713,677 (which is net of a $649,563 credit arising from
reversal of a portion of the previously-provided contingency reserve related
to billing disputes with AT&T - see Note 11, Notes to Consolidated Financial
Statements) for the nine months ending September 30, 1997 compared to
$6,257,220 (including a $904,000 provision for contingent costs provided
related to billing disputes with AT&T) for the nine months ending September
30, 1996. As a result, the gross margin was 11.6% of revenues for the nine
months ended September 30, 1997, compared to a negative gross margin of 21.0%.
Absent the adjustments to the contingency reserve, gross margin would be 3.0%
for the nine months ended September 30, 1997 and negative 3.5% for the
comparable period in 1996.

The decrease in selling and marketing expenses were a direct result of a
reduction of product advertising, largely due to market changes. The general
and administrative costs increased primarily due to a need for increased
outside professional assistance. In addition, there was a modest increase in
personnel cost. Bad debt expense has declined significantly due to unusually
high write-offs and reserves provided in 1996.

Amortization of $210,171 was attributable to the prepaid cellular telephone
technology license, which is being expensed over five years, and goodwill,
which is being amortized over seven years.

During the nine months ended September 30, 1996, the Company recognized



                                      12

<PAGE>

non-cash gains from exchange of marketable securities of $4,784,000 and
provided for deferred tax liabilities in the amount of $1,808,000 related to
those transactions. In the first quarter of 1997, the Company reversed the
deferred tax liability, recognizing income of $1,808,000.

The Company reported net income of $532,723 for the nine months ended
September 30, 1997, compared with net income of $3,276,945 for the comparable
period in 1996, a decrease in net income of $2,744,222. Reported net income
for both periods is affected by significant non-cash transactions. 1997
reported net income benefits from the reversal of previously-provided reserves
for contingencies ($649,563) and deferred income taxes ($1,808,000) and is
burdened by non-cash losses from disposition of marketable securities
($418,625, $748,625 less the portion allocated to the minority interest of
$330,000). 1996 reported net income benefits from sales of prepaid cellular
licenses ($3,650,000) and gain on sale of marketable securities ($4,784,000)
and is burdened by provisions for reserves for contingencies ($904,000) and
deferred income taxes ($1,808,000). Absent the above non-cash transactions,
the Company would have reported a net loss of $1,506,215 for the nine months
ended September 30, 1997 and $2,445,055 for the nine months ended September
30, 1996, an improvement of $938,840.

As discussed in footnote 1 to the consolidated financial statements, the
Company has accounted for certain non-cash transactions consummated in the
first quarter of 1997 based upon the book value of the assets surrendered. If
the Company had accounted for these transactions based upon the fair value of
the assets surrendered, the Company would have reported an additional loss of
approximately $4,900,000 from sale of securities in the nine months ended
March 31, 1997.

Three Months Ended September 30, 1997 Compared with September 30, 1996:

Sales of long distance services declined by $1,370,993 (44%) compared with the
comparable quarter in 1996. During the third quarter of 1996, the Company was
utilizing AT&T for a majority of its international traffic based upon a belief
that it was obtaining very favorable rates. These rates allowed the Company to
attract significant volume, with August, 1996 being the highest volume month
the Company has had. AT&T severed the relationship in late 1996. Consequently,
during the comparable period in 1997, the Company has not had the benefit of
such favorable rates. As a result, volume declined because the rates the
Company has been able to offer its customers have not been as competitive.
Revenues from prepaid telephone calling cards increased by $225,641 (71%)
compared with the comparable period in 1996 due to a combination of high usage
of cards sold in prior periods and recognition of revenue related to the
unused time on cards which expired during the third quarter of 1997.

Gross profit shows an improvement of $1,517,849. This improvement is almost
entirely due to the inclusion in cost of sales of a provision for contingent
costs of $904,000 in 1996 and a reversal of $649,563 of that provision in
1997. Absent the provision and reversal, gross profit would have been $75,816
(3.3% of sales) in 1997 and $111,530 (3.2% of sales) in 1996.

The decrease in selling and marketing expenses were a direct result of a
reduction of product advertising, largely due to market changes. The general
and administrative costs increased primarily due to a need for increased
outside professional assistance. In addition, there was a modest increase in
personnel cost. Bad debt expense has declined significantly due to unusually

                                      13

<PAGE>

high write-offs and reserves provided in 1996.

Amortization expense has increased by $103,382 due to the amortization of
goodwill, which started in 1997.

Liquidity and Capital Resources:

The Company has a working capital deficit of $6,232,822 at September 30, 1997
as compared with a deficit of $3,152,216 at December 31, 1996. Accounts
payable and accrued liabilities have increased by $2,233,960 since December
31, 1996, which, along with an increase in loans from the Company's principal
stockholder from $25,152 to $170,000, has been the source of capital to
finance the Company's operating losses during the period. In order to assure
the Company's survival, it is essential that the Company (i) restructure its
operations so that operating profits are generated and (ii) obtain additional
capital.

The Company has leased two central office telephone switches and related
facilities. Although this will obligate the Company to approximately $40,000
per month in additional facilities and equipment rent, the Company believes
that the increased capacity from the new switches will allow the Company to
generate operating income in the future. The Company believes that
profitability from the sale of telephone time can best be achieved by having
sufficient capacity to properly facilitate existing customer requirements and
by attracting more customers. This, in turn, will enable the Company to
purchase increasing numbers of telephone minutes, resulting in more favorable
purchase pricing. Upgraded technical performance of the telephone switches
which process the Company's traffic should also encourage increased traffic
volume and customer satisfaction. To that end, the Company has leased two
Siemens Stromberg-Carlson central office telephone switches which are
currently being installed in Miami and Jersey City. In addition, utilizing
these central office switches will permit the Company to pursue direct-connect
international agreements for long distance termination, which has the
potential to improve PICK's pricing structure dramatically in these areas.

These changes also allow the Company to structure the calling costs on PICK's
prepaid telephone calling cards sold at retail in a manner which should result
in increased retail sales. Overall, the Company believes it will be able to
generate operating income in the future.

The Company has signed a best efforts private placement agreement with Kaufman
Bros., L.P. to raise $5 million in equity or debt. The Company is also
pursuing other sources of capital. While the Company believes it will be
successful in its efforts to raise sufficient capital and to restructure its
operations so that it may continue as a going concern, there can be no
assurance that the Company will be successful.

                                      14
<PAGE>




Part II  - Other Information
           -----------------

Item 1 - Legal Proceedings:

During the nine months ended September 30, 1997, there were no material
changes in the Company's legal proceeding commenced against American Telephone
& Telegraph Company ("AT&T"). In November, 1997, AT&T indicated that it
intends to withdraw from the mediation. Accordingly, on November 5, 1997, the
Company filed an arbitration proceeding against AT&T.




                                      15
<PAGE>


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.



                                           PICK Communications Corp.


Date: November  14, 1997             By:   /s/  Diego Leiva
                                           -------------------------------------
                                           Diego Leiva
                                           President and Chief Executive Officer



Date: November  14, 1997             By:   /s/  Robert S. Bingham
                                           -------------------------------------
                                           Robert S. Bingham
                                           Chief Financial Officer
                                           (Principal Accounting Officer)



                                      16