SECURITIES & 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 September 30, 2000
                               ------------------

                                       or

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

For the transition period from            to

                            Commission File No. 1-106
                            -------------------------


                                LYNCH CORPORATION
                                -----------------
             (Exact name of Registrant as specified in its charter)


            Indiana                                           38-1799862
-------------------------------                          ----------------------
(State or other jurisdiction of                              I.R.S. Employer
incorporation or organization)                               Identification No.)


401 Theodore Fremd Avenue, Rye, New York                        10580
----------------------------------------                        -----
(Address of principal executive offices)                      (Zip Code)

                                (914) 921-7601
                                --------------
               Registrant's telephone number, including area code


Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities 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 the number of shares outstanding of each of the Registrant's classes of
Common Stock, as of the latest practical date.

   Class                                        Outstanding at October 31, 2000
   -----                                        --------------------------------
Common Stock, no par value                                 1,510,183

<PAGE>

                                      INDEX

                       LYNCH CORPORATION AND SUBSIDIARIES


PART I.     FINANCIAL INFORMATION


Item 1.  Financial Statements (Unaudited)

     Condensed  Consolidated Balance Sheets: - September 30, 2000 - December 31,
     1999

     Condensed  Consolidated  Statements of Operations:  - Three and nine months
     ended September 30, 2000 and 1999

     Condensed  Consolidated  Statements  of Cash  Flows:  - Nine  months  ended
     September 30, 2000 and 1999

     Notes to Condensed Consolidated Financial Statements:


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


Item 3.  Quantitative and Qualitative Disclosure About Market Risk


PART II.    OTHER INFORMATION



Item 6.  Exhibits  and  Reports on Form 8-K

     (a)  Exhibit 4(d)
     (b)  Exhibit 4(d)(i)
     (c)  Exhibit 4(d)(ii)
     (d)  Exhibits 27 - Financial Data Schedule
     (e)  Reports on Form 8-K  -  None




<PAGE>




SIGNATURES











<PAGE>


Part 1 - FINANCIAL INFORMATION -
Item 1 - Financial Statements
<TABLE>


                       LYNCH CORPORATION AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                 (In Thousands)
<CAPTION>
                                                                   September 30,   December 31,
                                                                       2000           1999
                                                                    (unaudited)        (A)
                                                                   -------------   ------------

ASSETS
CURRENT ASSETS
<S>                                                                <C>            <C>
     Cash and cash equivalents .................................   $    19,227    $    13,106
     Receivables, less allowances of $306 and $361 .............        36,916         24,642
     Inventories ...............................................        37,280         31,680
     Deferred income tax benefits ..............................         9,381          8,943
     Other current assets ......................................         1,096          1,303
                                                                   -----------    -----------

     TOTAL CURRENT ASSETS ......................................       103,900         79,674
Restricted Cash ................................................          --           56,026

PROPERTY, PLANT AND EQUIPMENT
     Land ......................................................           672            672
     Buildings and improvements ................................        11,028         11,015
     Machinery and equipment ...................................        56,084         54,529
                                                                   -----------    -----------
                                                                        67,784         66,216
     Accumulated depreciation ..................................       (25,932)       (22,137)
                                                                   -----------    -----------
                                                                        41,852         44,079

EXCESS OF COST OVER FAIR VALUE OF NET ASSETS ACQUIRED,NET ......        21,912         22,020
OTHER ASSETS ...................................................         7,641          9,393
                                                                   -----------    -----------
    TOTAL ASSETS ...............................................   $   175,305    $   211,192
                                                                   ===========    ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
     Notes payable to banks ....................................   $    24,531    $    23,178
     Trade accounts payable ....................................        21,768         14,404
     Accrued liabilities .......................................        19,586         16,382
     Customer advances .........................................         5,610            860
     Current maturities of long-term debt ......................         3,237          1,636
                                                                   -----------    -----------
     TOTAL CURRENT LIABILITIES .................................        74,732         56,460

LONG TERM DEBT .................................................        58,864        116,765
DEFERRED INCOME TAXES ..........................................         6,048          6,225
OTHER LONG TERM LIABILITIES ....................................         4,417          4,866
MINORITY INTERESTS .............................................        10,405         10,885

SHAREHOLDERS' EQUITY
   COMMON STOCK,  NO PAR VALUE - 10,000,000  SHARES  AUTHORIZED;
     1,513,191 and 1,471,191 shares issued
     (at stated value) .........................................         5,139          5,139
   ADDITIONAL PAID-IN CAPITAL ..................................        10,111          8,302
   RETAINED EARNINGS ...........................................         5,691          3,843
   ACCUMULATED OTHER COMPREHENSIVE LOSS ........................           (40)           (40)
   TREASURY STOCK OF 3,008 and 61,008 SHARES, AT COST ..........           (62)        (1,253)
                                                                   -----------    -----------
   TOTAL SHAREHOLDERS' EQUITY ..................................        20,839         15,991
                                                                   -----------    -----------

   TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY ..................   $   175,305    $   211,192
                                                                   ===========    ===========

<FN>
(A) The Balance  Sheet at December  31, 1999 has been  derived  from the audited
financial  statements at that date, but does not include all of the  information
and footnotes required by generally accepted accounting  principles for complete
financial statements.
</FN>

                             See accompanying notes
</TABLE>

<PAGE>


<TABLE>

                       LYNCH CORPORATION AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                      (In thousands, except share amounts)

<CAPTION>
                                                                            Three Months              Nine months
                                                                         Ended September 30,      Ended September 30,
                                                                        ---------------------    -----------------------
                                                                           2000       1999           2000       1999
                                                                        ---------------------    -----------------------
<S>                                                               <C>            <C>            <C>            <C>
SALES AND REVENUES ............................................   $    56,192    $    51,070    $   161,674    $   144,844
Costs and expenses:
    Manufacturing cost of sales ...............................        47,926         45,380        139,701        128,165
    Selling and administrative ................................         7,758          4,683         19,554         14,827
    Restructuring charge ......................................          --             --              527            450
                                                                   -----------    -----------   -----------     ----------
OPERATING PROFIT ..............................................           508          1,007          1,892          1,402
Other income (expense):
    Investment Income .........................................           335            565          1,296            572
    Interest expense ..........................................        (2,471)        (3,267)        (8,412)        (7,796)
                                                                   -----------    -----------   -----------    -----------
                                                                       (2,136)        (2,702)        (7,116)        (7,224)
                                                                   -----------    -----------   -----------    -----------
LOSS FROM CONTINUING OPERATIONS BEFORE INCOME
  TAXES,  MINORITY INTERESTS, DISCONTINUED
  OPERATIONS AND EXTRAORDINARY ITEM ...........................        (1,628)        (1,695)        (5,224)        (5,822)

Benefit  from income taxes ....................................           796            700          1,875          2,337
Minority interests ............................................         1,058            378          2,951          1,393
                                                                  -----------    -----------    -----------    -----------
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE
   DISCONTINUED OPERATIONS AND EXTRAORDINARY ITEM .............           226           (617)          (398)        (2,092)

DISCONTINUED OPERATIONS:
  Income  (loss)  from  operations  of  Lynch  Interactive
   Corporation distributed to shareholders  (less income tax
   (provision) benefit of ($803) and $3,068 and minority
   interests of $147 and $578) ................................          --            1,024           --           (7,493)

   Loss from  discontinued  operations  of  industrial  tape
    segment  of Spinnaker  Industries (less  applicable  income
    tax benefit of $308 and minority interests of $558) .......          --             --             --             (572)

   Gain on sale of Spinnaker's Industrial Tape operations
    (less income tax provision of $9,495 and minority
    interest of $7,013) .......................................          --            7,431           --            7,431

EXTRAORDINARY ITEM
     Gain  on early extinguishment of debt (less income tax
      provision of $73, $2,612 and $73 minority interest of
      $60, $2,472 and $60) ....................................          --               54          2,245             54
                                                                  -----------    -----------    -----------    -----------
NET INCOME (LOSS) .............................................   $       226    $     7,892    $     1,847    ($    2,672)
                                                                  ===========    ===========    ===========    ===========
   Weighted average shares outstanding ........................     1,510,000      1,412,000      1,485,000      1,415,000
                                                                  ===========    ===========    ===========    ===========
Basic and diluted earnings per share:

   Income ( loss) from continuing operations ..................   $      0.15    ($     0.44)   ($     0.27)   ($     1.48)
    Income (loss) from Lynch Interactive Corporation ..........          --             0.73           --            (5.30)
    Income from Spinnaker Tape operations and sale ............          --             5.26           --             4.85
    Extraordinary item ........................................          --             0.04           1.51           0.04
                                                                  -----------    -----------    -----------    -----------
NET INCOME (LOSS) .............................................   $      0.15    $      5.59    $      1.24    ($     1.89)
                                                                  ===========    ===========    ===========    ===========
                        See accompanying notes

</TABLE>

<PAGE>
<TABLE>


                       LYNCH CORPORATION AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (In Thousands)
<CAPTION>
                                                                    Nine months Ended
                                                                       September 30,
                                                                     2000         1999
                                                                  ----------   ----------
OPERATING ACTIVITIES:
<S>                                                              <C>          <C>
Net income (loss) ............................................   $   1,847    ($  2,672)
Adjustment to reconcile net income (loss) to net cash
provided by operating activities of continuing operations:
     Loss from operations of Lynch Interactive Corporation ...        --          7,493
     Loss from operations of industrial tape segment .........        --            572
     Gain on sale of industrial tape segment .................        --         (7,431)
     Extraordinary item ......................................      (2,245)         (54)
     Depreciation and amortization ...........................       4,968        4,226
     Amortization of deferred financing charges ..............       1,168          630
     Deferred taxes ..........................................        (615)        (805)
     Minority interests ......................................        (480)      (1,393)
     Gain on sale of fixed assets ............................        --           (854)
     Changes in operating assets and liabilities:
        Receivables ..........................................     (12,274)         495
        Inventories ..........................................      (5,600)      (3,563)
        Accounts payable and accrued liabilities .............      15,318        3,091
        Other ................................................         208          418
                                                                 ---------    ---------
Cash provided by operating activities of
   continuing operations                                             2,295          153
                                                                 ---------    ---------
INVESTING ACTIVITIES:
Capital expenditures .........................................      (2,317)      (2,828)
Proceeds from sale of Spinnaker's industrial tape segment ....        --        104,450
Proceeds from sale of fixed assets ...........................        --          2,442
Other ........................................................          75         (737)
                                                                 ---------    ---------
Cash provided by (used in) investing activities
  of continuing operations ...................................      (2,242)     103,327
                                                                 ---------    ---------
FINANCING ACTIVITIES:
Change in notes payable ......................................       1,353      (39,026)
Repayment & buy back of long-term debt .......................     (53,986)      (5,100)
Deferred financing costs .....................................         (69)        (468)
Sale of common stock .........................................       3,000         (474)
Other ........................................................        (256)      (1,188)
                                                                 ---------    ---------
Cash (used in) financing activities of continuing operations
                                                                   (49,958)     (46,256)
                                                                 ---------    ---------
Net (decrease) increase in cash and cash equivalents .........     (49,905)      57,224
Cash provided by Lynch Interactive Corporation ...............        --         15,987
Cash provided by industrial tape segment .....................        --          4,310
                                                                 ---------    ---------
(Decrease) increase in cash and cash equivalents .............     (49,905)      77,521
Cash and cash equivalents at beginning of period including
   $56,026 of Restricted Cash at December 31, 1999 ...........      69,132        1,132
                                                                 ---------    ---------
Cash and cash equivalents at end of period ...................   $  19,227    $  78,653
                                                                 =========    =========

                           See accompanying notes

</TABLE>

<PAGE>

LYNCH CORPORATION AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

A.     Subsidiaries of the Registrant
<TABLE>

As of September 30, 2000, the Subsidiaries of the Registrant are as follows:
<CAPTION>

Subsidiary                                                                   Owned By Lynch
----------                                                                   --------------
<S>                                                                          <C>
Lynch Display Technologies, Inc. .......................................     100.0%
Lynch Systems, Inc. ....................................................      92.0%
     Lynch International Holding Corporation ...........................      92.0%
     Lynch-AMAV LLC ....................................................      69.0%
M-tron Industries, Inc. ................................................     100.0%
     M-tron Industries, Ltd. ...........................................     100.0%
     Spinnaker Industries, Inc. ........................................      47.6%(O)60.4%(V)
          Entoleter, Inc. ..............................................      47.6%(O)60.4%(V)
          Spinnaker Coating, Inc. ......................................      47.6%(O)60.4%(V)
                Spinnaker Coating-Maine, Inc. ..........................      47.6%(O)60.4%(V)
             Spinnaker Electrical Tape Company .........................      47.6%(0)60.4%(V)
<FN>
Notes:(O)=Percentage of equity ownership; (V)=Percentage voting control
</FN>
</TABLE>




<PAGE>

B.       Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance  with  accounting  principles  generally  accepted in the
United States for interim  financial  information  and with the  instructions to
Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all
of the  information  and  footnotes  required by generally  accepted  accounting
principles for complete financial statements. In the opinion of management,  all
adjustments (consisting of normal recurring accruals) considered necessary for a
fair  presentation  have been  included.  Operating  results  for the nine month
period ended  September 30, 2000 are not  necessarily  indicative of the results
that  may be  expected  for the year  ending  December  31,  2000.  For  further
information,  refer  to the  consolidated  financial  statements  and  footnotes
thereto  included in the  Registrant's  Annual  Report on Form 10-K for the year
ended December 31, 1999.

The accompanying  unaudited condensed  consolidated financial statements reflect
the  spin  off of  Lynch  Interactive  Corporation  ("Interactive")  from  Lynch
Corporation ("Lynch" or "Registrant") that occurred in the third quarter of 1999
(see  Note  D) and  the  sale  of  the  industrial  tape  segment  of  Spinnaker
Industries, Inc., that occurred in the third quarter of 1999 (see Note C).

C.       Discontinued Operations

In the third  quarter of 1999,  the Company's  48% owned  subsidiary,  Spinnaker
Industries,  Inc. sold its two industrial tape units,  Central  Products Company
and Spinnaker  Electrical,  which  comprised  its  industrial  tape segment,  to
Intertape Polymer Group, Inc. ("Intertape").  The consideration for the sale was
approximately  $105 million and 300,000 five-year warrants to purchase shares of
Intertape  common  stock at  $29.50  each.  Spinnaker  recognized  a gain on the
transactions  of $24 million before tax and the Registrant  recognized a similar
gain before income tax and minority  interests.  The agreement to sell Spinnaker
Electrical  was  completed  on July 30, 1999 and the  agreement  to sell Central
Products was completed on August 10, 1999. As a result, the Company's industrial
tape segment is being reported as a discontinued  operation in the  accompanying
condensed consolidated financial statements.  Accordingly,  operating results of
the industrial tape segment have been segregated from continuing  operations and
reported as a separate line item on the statements of operations. The industrial
tape segment's net sales were $10.7 million and $69.5 million,  respectively for
the three and nine month periods ended September 30, 1999.

D.       Spin Off

On August 12, 1999,  the Board of Directors  approved a plan to  distribute  the
stock  of  Lynch  Interactive  Corporation  on  a  one  for  one  basis  to  the
shareholders of Lynch ("Spin Off"). Lynch completed the Spin Off on September 1,
1999 to  stockholders  of record on August 23,  1999.  Pursuant to the Spin Off,
each Lynch shareholder received one share of Interactive stock for each share of
Lynch  owned.  Lynch had  received a private  letter  ruling  from the  Internal
Revenue  Service  that  the Spin  Off  would be tax free to Lynch  shareholders.
Interactive is listed on the American Stock Exchange under the symbol "LIC".

Interactive owns all of what was Lynch's multimedia and service businesses while
Lynch  retains the  manufacturing  businesses.  Interactive  owns the  telephone
companies,  television  interests and PCS  interests,  as well as the 55% equity
interest of The Morgan Group, Inc. In addition,  Interactive owns a 13.6% equity
interest in Spinnaker  Industries,  Inc.  Lynch owns a 47.6% equity  interest in
Spinnaker (60.4% of voting interest), as well as 100% of M-tron Industries, Inc.
and 92% of Lynch Systems, Inc.

As a result,  the Company's  multimedia and services segments are being reported
as  operations   distributed  to  shareholders  in  the  accompanying  condensed
consolidated financial statements. Accordingly, operating results of Interactive
have been segregated from continuing  operations and reported as a separate line
item on the statements of operations.

Interactive's net sales for the three and nine month periods ended September 30,
1999 were $52.8 million and $155.8 million, respectively.

In the third  quarter  of 1999,  Lynch  acquired  by merger  all of the stock of
Central Scott Telephone Company. This company became part of Interactive and was
included in the Spin Off.

Interactive  and Lynch have entered into certain  agreements  governing  various
ongoing  relationships,  including the  provision of support  services and a tax
allocation  agreement.  The tax allocation agreement provides for the allocation
of  tax  attributes  to  each  company  as if it had  actually  filed  with  the
respective tax authority. At the Spin Off, the employees of the corporate office
of Lynch became the employees of Interactive  and  Interactive  began  providing
certain corporate  management  services to Lynch,  which is charged a management
fee for these  services.  This charge was $60,000 and $240,000 for the three and
nine months ended September 30, 2000, respectively.

Net assets of  approximately  $23 million were distributed to Interactive at the
Spin Off. Such amount was  subsequently  decreased in the fourth quarter of 1999
by $1.6 million to reflect a revision in the allocation of certain liabilities.

E.       Inventories

Inventories  are stated at the lower of cost or market  value.  At September 30,
2000 and December 31, 1999,  inventories were valued by three methods:  last in,
first-out  (LIFO)- 26%;  specific  identification - 72%; and first in, first out
(FIFO) - 2%. At December  31,  1999,  the  percentages  were 12%,  80%,  and 8%,
respectively.
<TABLE>
<CAPTION>
                         (In Thousands)
                   September 30, December 31,
                       2000      1999
                     ---------------------
<S>                   <C>       <C>
Raw materials .....   $10,265   $10,407
Work in process ...     3,507     2,114
Finished goods ....    23,508    19,159
                      -------   -------
  Total Inventories   $37,280   $31,680
                      =======   =======
</TABLE>

F.       Indebtedness

Spinnaker   Industries,   Inc.  maintains  revolving  lines  of  credit  at  its
subsidiaries which total $40 million,  of which $23.6 million was outstanding as
of  September  30,  2000 and had $5.8  million of  available  borrowings.  These
facilities were refinanced in conjunction  with the sale of Central Products and
Spinnaker Electrical.

In general, the credit facilities are secured by property,  plant and equipment,
inventory,  receivables  and common  stock of certain  subsidiaries  and contain
certain covenants restricting distributions to the Registrant.
<TABLE>
<CAPTION>
                                                                             (In Thousands)
Long term debt consists of:                                             September 30,  December 31,
                                                                            2000           1999
                                                                         -------------------------
<S>                                                                       <C>          <C>
Spinnaker -  10.75% Senior Secured Note due 2006 .......................   $  51,135    $ 108,585

Spinnaker - 10% Subordinated Note with PIK interest and principal due on
January 31, 2002 .......................................................       7,000        7,000

Other ..................................................................       3,966        2,816
                                                                           ---------    ---------
                                                                              62,101      118,401
Current Maturities .....................................................      (3,237)      (1,636)
                                                                           ---------    ---------
                                                                           $  58,864    $ 116,765
                                                                           =========    =========
</TABLE>

As of September 30, 2000,  proceeds from the sale of Central  Products (see Note
C) have been utilized in accordance  with the terms of the Senior  Secured Notes
Indenture to either repay  indebtedness or invest in the  adhesive-backed  paper
business. For the nine months ended September 30, 2000 Spinnaker purchased $57.5
million  (par value) of the  outstanding  Senior  Notes on the open market at an
average  price of 83.1%  reflecting  a pre-tax  gain of $7.5  million  after the
charge off of applicable  deferred financing costs. The Registrant  recognized a
similar gain before income taxes and minority interest.  There were no purchases
in the third quarter.

The Senior Note purchases to date and capital  expenditures in the business have
fully utilized the Restricted Proceeds from the above referenced sale.

During the first nine months of 2000 the Company has guaranteed project specific
credit  facilities  for Lynch  Systems  totaling  approximately  $8 million.  At
September 30, 2000 there was $1.7 million borrowed on these facilities and it is
expected  that these and any other amounts  borrowed on these  facilities in the
future will be repaid in the first quarter of 2001.

G.     Earnings per share

Basic  earnings  per common  share  amounts are based on the  average  number of
common shares outstanding during each period,  excluding the dilutive effects of
options, warrants, and convertible securities of which there were none.

H.       Segment Information

After the distribution to shareholders of the stock of Interactive,  the Company
is engaged in the manufacture of adhesive-backed label stock,  frequency control
devices  and  other  manufacturing.  The  Company  measures  performance  of its
segments  primarily by revenues,  operating profit and EBITDA  (operating profit
before  income  taxes,   depreciation,   amortization  and  allocated  corporate
expenses). Except for Spinnaker (the adhesive-backed label stock business) using
approximately  $56.0  million  of  restricted  cash to  repurchase  debt and for
capital asset  purchases,  identifiable  assets of each segment have not changed
materially since December 31, 1999.

EBITDA for  operating  segments is equal to operating  profit  before  interest,
taxes,  depreciation,  and  amortization.  EBITDA is  presented  because it is a
widely  accepted  financial  indicator of value and ability to incur and service
debt.  EBITDA  is not a  substitute  for  operating  income or cash  flows  from
operating   activities  in  accordance   with  generally   accepted   accounting
principles.

Operating  profit  is equal  to  revenues  less  operating  expenses,  excluding
interest,  minority  interests  and income taxes.  Prior to the Spin Off,  Lynch
allocated a portion of its general corporate expenses to its operating segments.
Subsequent  to  the  Spin  Off,   Interactive  is  providing  certain  corporate
management  services  to  the  Registrant  and  charging  a  corporate  overhead
management  fee while the  Registrant  still  allocates a portion of its general
corporate expenses to its operating segments.

In 1999, general corporate office expenses related to finance and administrative
functions  including  public  company  compliance  reporting,  bank and investor
relations,  taxes and other  than  income  taxes and  holding  company  payroll,
historically  allocated and charged to the industrial tape segment were reversed
and allocated back to continuing operations.  These expenses were not considered
to be directly attributable to discontinued operations.

On October 27, the Company announced that M-tron,  our frequency control devices
business had filed a  registration  statement  with the  Securities and Exchange
Commission for a rights  offering of shares of M-tron's  common stock that would
represent an approximate 13% interest in M-tron. Subject to the effectiveness of
the registration statement, Lynch presently contemplates that it will distribute
to its  shareholders one right for each share of Lynch common stock owned on the
record date to be established. One and one-half rights will permit the holder to
purchase one share of M-tron stock for $5 per share. Nothing contained herein is
intended to constitute an offer of M-tron's common stock.

<PAGE>
<TABLE>
<CAPTION>

                                                Three Months Ended       Nine months Ended
                                                  September 30,             September 30,
                                                ------------------       -----------------
                                                2000        1999         2000       1999
                                               ------      ------       ------     ------
Revenues:
<S>                                           <C>          <C>          <C>          <C>
  Adhesive-backed label stock .............   $  35,756    $  39,535    $ 113,374    $ 116,191
  Frequency control devices ...............      10,900        7,087       29,384       19,458
  Other Manufacturing .....................       9,536        4,448       18,916        9,195
                                              ---------    ---------    ---------    ---------
  Consolidated Total ......................   $  56,192    $  51,070    $ 161,674    $ 144,844
                                              ---------    ---------    ---------    ---------
EBITDA
  Adhesive-backed label stock .............   $     609    $   1,864    $   4,577    $   6,553
  Frequency control devices ...............       1,391          951        3,885        2,039
  Deferred incentive compensation-frequency
    frequency control devices .............        (420)        --           (420)        --
  Other manufacturing .....................       1,296          228        1,911         (831)
  Corporate manufacturing expenses ........        (313)        (223)      (1,454)      (1,061)
                                              ---------    ---------    ---------    ---------
  Total manufacturing .....................       2,563        2,820        8,499        6,700

  Corporate expenses ......................        (356)        (382)      (1,112)        (622)
  Restructuring charge - Spinnaker ........        --           --           (527)        (450)
                                              ---------    ---------    ---------    ---------
  Consolidated Total ......................   $   2,207    $   2,438    $   6,860    $   5,628
                                              ---------    ---------    ---------    ---------
Operating Profit
   Adhesive-backed label stock ............   $    (734)   $     916    $     682    $   3,562
   Frequency control devices ..............       1,214          668        3,373        1,510
   Deferred incentive compensation-
      frequency control devices ...........        (420)        --           (420)        --
   Other manufacturing ....................       1,161          151        1,510       (1,167)
   Corporate manufacturing expenses .......        (282)        (721)      (1,389)      (1,666)
                                              ---------    ---------    ---------    ---------
   Total manufacturing ....................         939        1,014        3,756        2,239

   Unallocated corporate expenses .........        (431)          (7)      (1,337)        (387)
   Restructuring charge - Spinnaker .......        --           --           (527)        (450)
                                              ---------    ---------    ---------    ---------
   Consolidated Total .....................   $     508    $   1,007    $   1,892    $   1,402
                                              =========    =========    =========    =========

Other profit or loss
   Investment income ......................         335          565        1,296          572
   Interest expense .......................      (2,471)      (3,267)      (8,412)      (7,796)
                                              ---------    ---------    ---------    ---------

Loss from continuing operations
   before taxes, minority interest
   and extraordinary items ................   $  (1,628)   $  (1,695)   $  (5,224)   $  (5,822)
                                              =========    =========    =========    =========
</TABLE>


I.       Accounting and Reporting Policies

Securities and Exchange  Commission's  Staff Accounting  Bulletin 101 summarizes
certain  of  the  staff's  views  in  applying  generally  accepted   accounting
principles to revenue  recognition in the financial  statements.  The Registrant
has assessed the impact that SAB 101 will have on its revenue recognition policy
when it is adopted in the fourth quarter of 2000 and has  determined  that there
is little, if any, exposure.

Item 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
         CONDITION AND RESULTS OF OPERATIONS.

Sales and Revenues

Revenues  for the third  quarter of 2000  increased  by $5.1  million or 10%, to
$56.2  million,  from the third  quarter of 1999.  Revenues  for the nine months
ended September 30, 2000 increased by $16.8 million or 11.6% from the comparable
1999 period reflecting increased order flow.

Revenues from Spinnaker  Industries,  Inc.'s continuing  operations fell by $4.5
million  between the two  quarters  primarily  due to an  extremely  competitive
pricing  environment  resulting in lower average  selling  prices and volumes in
Spinnaker's  general  purpose  pressure-sensitive  products.   Additionally,  as
compared  to the same  period in 1999,  lower  sales  are the  result of a joint
venture  entered into to outsource the  manufacturing  and sales of non-pressure
sensitive product lines in the fourth quarter of 1999. Offsetting these declines
is the continued  growth in sales of pressure  sensitive sheet  products,  which
increased by  approximately  $1.1 million  from the  corresponding  1999 period.
Spinnaker's  revenues for the nine months ended  September  30, 2000 were $117.6
million,  compared  to $121.5  million in the  corresponding  1999  period.  The
decrease in net sales for 2000 is attributed to entering into a joint venture to
outsource the manufacturing and sales of non-pressure sensitive product lines in
the  fourth  quarter  of  1999  and  lower  sales  volumes  of  general  purpose
pressure-sensitive  products.  Net sales were also impacted by lower prices from
intense price  competition in the general  purpose and other  pressure-sensitive
product lines. Offsetting these declines were strong sales of pressure sensitive
sheet products, in which volumes increased approximately 62% over the comparable
1999 period.

Revenues at M-tron  increased by $3.8  million or 54%, to $10.9  million for the
three month period due to increased demand from the telecommunications  industry
and  increased  sales of new  products.  Revenues  at M-tron  for the nine month
period increased $9.9 million, or 51%, to $29.4 million due to the same factors.
Lynch Systems'  revenues for the third quarter increased by $5.8 million to $8.0
million  reflecting  increased  orders and sales of glass press machines.  Lynch
Systems  revenues for the nine month  period  increased  $10.8  million to $14.7
million for the same reasons.

Operating  profit for the third  quarter  2000 of $.5 million  decreased  by $.5
million  compared to the prior year. For the nine month period  operating profit
of  $1.9  million  increased  by  $.5  million  compared  to  the  1999  period.
Spinnaker's  operating  profit in the third quarter declined by $2.0 million due
to lower  volumes,  and  reduction  in gross  margins  as a result  of the lower
pricing  noted  above.  These  factors  also  affected the nine month period for
Spinnaker  where  there was an  operating  loss of $1.1  million  compared to an
operating profit of $1.8 million in 1999. The 1999 period included a $.9 million
gain from the sale of operating assets. For the third quarter M-tron's operating
profit  increased by $.5 million to $1.2  million due to increased  sales volume
mentioned above. For the nine months,  M-tron's  operating  profits increased by
$1.8  million  to $3.4  million  due to strong  order flow and  increased  sales
volume. The current quarter and year-to-date results were before an


accrual of $420,000 for deferred incentive compensation.  No payment will be due
under  this   arrangement  in  the  event  M-tron  goes  public,   as  presently
contemplated,  in which case this obligation  will be eliminated.  Lynch Systems
had an  operating  profit of $1.0 million  compared to an operating  loss of $.7
million in the third  quarter of 1999.  For the nine month period Lynch  Systems
had an operating  profit of $1.3 million  compared to an operating  loss of $2.0
million in the comparable  period in 1999.  This  turnaround for both periods at
Lynch Systems is  principally  due to increased  activity on orders  received in
1999 and earlier this year. The 2000 Operating profit also benefited as a result
of better absorption of overhead.

Other Income (Expense), Net

Investment  income  decreased for the quarter as the  utilization  of restricted
cash from the 1999 sale of  Spinnaker's  industrial  tape units to buy back debt
reduced  the  funds  available  for short  term  investment.  Investment  income
increased  for the nine  months  due to the net  proceeds  of the  1999  sale of
Spinnaker's industrial tape units, which were invested in short term instruments
during the periods until the debt repurchase mentioned above.

Interest  expense was $2.5 million for the quarter and decreased by $.8 million,
primarily  due  to  the  repuchase  of  Spinnaker's  Senior  Notes.  During  the
nine-month  period ended September 30, 2000,  interest expense  increased by $.6
million.  This  increases for the nine months was  primarily due to  allocations
during the 1999 periods of a portion of the interest expense to the discontinued
industrial tape units until the time of their sale.

Tax Provision

The income tax benefit includes  federal,  as well as state and local taxes. The
tax benefit for the nine months ended  September  30, 2000 and 1999,  represents
effective  tax  rates of 36% and 40%,  respectively.  The  differences  from the
federal  statutory rate are principally due to the effect of state income taxes,
foreign income (loss) and amortization of non-deductible goodwill.

Minority Interest

Minority  interests  contribution to net income increased by $.7 million for the
quarter and $1.6 million for the nine  months,  from the  respective  prior year
periods of 1999 due to the  increased net losses from  continuing  operations at
Spinnaker for both periods and the increase in the minority interest  percentage
at this subsidiary.

Discontinued Operations

As a result of the Spin Off (see Note D), the Company's  multimedia and services
segments are being  reported as operations  distributed to  shareholders  in the
accompanying  condensed  consolidated financial statements for the 1999 periods.
Accordingly,   operating  results  of  Interactive  have  been  segregated  from
continuing  operations  and reported as a separate line item on the statement of
operations.

As a result of Spinnaker's  sale of its industrial  tape segment (see Note C) in
the third quarter of 1999, operating results of the industrial tape segment have
been  segregated  from  continuing  operations  and reported  separately  in the
statement of operations for 1999.

Net Income/Loss

Net income for the three months ended  September 30, 2000 was $226,000,  or $.15
per share,  as compared to a net income of $7.9  million,  or $5.59 per share in
the previous  year's three month  period.  The absence of the income in the spun
off  operations of Interactive  and the gain on the sale of the industrial  tape
segment at Spinnaker in 1999 were the primary  reasons for this reduction in Net
Income, although income from continuing operations improved.

Net income for the nine months  ended  September  30,  2000 was $1.8  million or
$1.24 per share,  as compared  to a net loss of $2.7  million or $1.89 per share
for the 1999 period.  The absence of the losses in the discontinued  operations,
the gain on the early extinguishment of debt at Spinnaker and improved operating
results from  continuing  operations,  offset by the gain on sale of Spinnaker's
industrial tape segment, were the primary reasons for this improvement.

Backlog/New Orders

Total backlog of manufactured  products from continuing  operations at September
30, 2000 was $44.7  million,  which  represents an increase of $9.4 million from
the backlog of $35.3  million at December 31, 1999.  Increased  order receipt at
M-tron  accounted for the  significant  increase to the backlog at September 30,
2000.


FINANCIAL CONDITION
Liquidity/Capital Resources

As of September 30, 2000,  the Company had current  assets of $103.9 million and
current  liabilities  of $74.7  million.  Working  capital was  therefore  $29.2
million as  compared to $23.2  million at December  31,  1999.  The  increase is
primarily due to improved operating results.

Capital  expenditures  for the nine  months  were $2.3  million in 2000 and $2.8
million  in 1999.  The  Company  plans to spend  approximately  $4.8  million on
capital  expenditures  for the year and anticipates that it will have sufficient
cash flow from  operations  and  borrowing  availability  under  various  credit
facilities at its subsidiaries to fund such capital expenditure plans.

At September  30, 2000,  total debt was $86.6  million,  which was $55.0 million
less than the $141.6  million at the end of 1999. The reduction is primarily due
to principal  repayments and debt repurchases.  Total debt at September 30, 2000
included  $60.3 million of fixed interest rate debt, at an average cash interest
rate of 10.6%,  and $26.3  million of variable  interest rate debt at an average
interest  rate of 9.2%.  Additionally,  the Company  had unused  lines of credit
facilities  of which the Spinnaker  Credit  Facility is the major  portion.  The
Spinnaker Credit Facility is available to fund acquisitions and support periodic
fluctuations in working capital.  Credit availability under the Spinnaker Credit
Facility is subject to certain  variables,  such as  inventory  and  receivables
eligible  to be  included  in the  borrowing  base.  The  Company  is charged an
available credit fee of 0.375% per annum.  Outstanding  borrowings bear interest
at variable rates related to the prime interest rate or LIBOR.  At September 30,
2000, the combined  effective  interest rate was 9.2%. In  conjunction  with the
industrial  tape sale,  the Spinnaker  Credit  Facility was  refinanced  and the
aggregate facility was decreased from $60 million to $40 million. The Refinanced
Credit Facility will expire December 31, 2001. As of November 1, 2000, aggregate
availability  under the Refinanced  Spinnaker Credit Facility was  approximately
$28.2 million, of which approximately $23.6 million was outstanding.  During the
first nine months of 2000, the Company has guaranteed  project  specific  credit
facilities for Lynch Systems totaling approximately $8 million. At September 30,
2000,  there was $1.7 million  borrowed on these  facilities  and it is expected
that these facilities will be repaid in the first quarter of 2001.

The Company does not at present  have credit  facilities  at the parent  company
level. Management believes it has adequate working capital at this level to fund
current operations for the foreseeable future.

Current debt outstanding at subsidiaries  contains restrictions on the amount of
readily available funds that can be transferred to Lynch Corporation.

Accounting and Reporting Policies

Securities and Exchange  Commission's  Staff Accounting  Bulletin 101 summarizes
certain  of  the  staff's  views  in  applying  generally  accepted   accounting
principles to revenue  recognition in the financial  statements.  The Registrant
was  assessed  the impact that SAB will have on its revenue  recognition  policy
when it is adopted in the fourth quarter of 2000 and has  determined  that there
is little, if any, exposure.

MARKET RISK

The Company is exposed to market risk  relating to changes in the general  level
of U.S. interest rates. Changes in interest rates affect the amounts of interest
earned  on  the  Company's   cash   equivalents   and   short-term   investments
(approximately  $19.2  million at September  30,  2000).  The Company  generally
finances the debt  portion of the  acquisition  of  long-term  assets with fixed
rate,  long-term debt. The Company generally  maintains the majority of its debt
as fixed rate in nature by borrowing  on a fixed  long-term  basis.  The Company
does  not use  derivative  financial  instruments  for  trading  or  speculative
purposes.  Management does not foresee any significant changes in the strategies
used to manage  interest rate risk in the near future,  although the  strategies
may be reevaluated as market conditions dictate.

At September  30, 2000,  approximately  $26.3  million,  or 30% of the Company's
long-term debt and notes payable bears interest at variable rates.  Accordingly,
the Company's earnings and cash flows are affected by changes in interest rates.
Assuming the current level of  borrowings  for variable rate debt and assuming a
one  percentage  point  change in the 2000  average  interest  rate under  these
borrowings, it is estimated that the Company's nine months 2000 interest expense
would have changed by less than $.2 million.  In the event of an adverse  change
in interest rates,  management would likely take actions to further mitigate its
exposure. However, due to the uncertainty of the actions that would be taken and
their  possible  effects,  the analysis  assumes no such actions.  Further,  the
analysis  does not  consider  the  effects of the change in the level of overall
economic activity that could exist in such an environment.

Included in this Management  Discussion and Analysis of Financial  Condition and
Results  of  Operations  are  certain  forward   looking   financial  and  other
information,  including  without  limitation  matters  relating to Spinnaker and
Market Risk.  It should be recognized  that such  information  are  projections,
estimates  or  forecasts  based  on  various   assumptions,   including  without
limitation, meeting its assumptions regarding expected operating performance and
other matters specifically set forth, as well as the expected performance of the
economy as it impacts the  Registrant's  businesses,  government  and regulatory
actions and approvals, and tax consequences, and the risk factors and cautionary
statements  set forth in reports  filed by  Registrant  and  Spinnaker  with the
Securities and Exchange Commission.  As a result, such information is subject to
uncertainties, risks and inaccuracies, which could be material.


Item 3.  Quantitative and Qualitative Disclosure About Market Risk

                  See "Market Risk" under Item 2 above.

PART II OTHER  INFORMATION

Item 6. Exhibits and Reports on Form 8-K

(a) Exhibits


     4(d) Referenced Credit Agreement among Spinnaker Coating,  Inc.,  Spinnaker
          Coating-Maine,  Inc.  and  Entoleter,  Inc.  as  Borrowers,  Spinnaker
          Industries,  Inc. as  Guarantor,  each of the  financial  institutions
          listed as Schedule 1 hereto and Transamerica Business Corporation,  as
          Agent,  dated  August  9,  19999  and  the  First,  Second  and  Third
          Amendments thereto  (incorporated by reference to Exhibits 10.5, 10.6,
          10.7 and 10.8 to Spinnaker's Form 10-K for the year ended December 31,
          1999).

     4(d)(i) Fourth  Amendment to Referenced  Credit  Agreement  dated April 17,
          2000  (incorporated  by reference to Exhibit 10.1 to Spinnaker's  form
          10-Q for the quarter ended March 31, 2000).

     4(d)(ii) Fifth Amendment to Referenced Credit Agreement dated September 30,
          2000  (incorporated  by reference to Exhibit 10.1 to Spinnaker's  Form
          10-Q for the quarter ended September 30, 2000).

          27 -   Financial Data Schedule

                  (b)  Reports on Form 8-K
                      None


<PAGE>




                                   SIGNATURES


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


                            LYNCH CORPORATION
                            (Registrant)



                             By: s/Roger J. Dexter
                                 Roger J. Dexter
                                 Chief Financial Officer

November 13, 2000