##### Table of Contents






United States Securities and Exchange
Commission

Washington, DC 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 or 15(d) of the
	Securities
	Exchange Act of 1934
	For the transition period from   to   .         

Commission File Number: 0-21213

LCC International, Inc.

(Exact name of registrant as specified in its
charter)




---

|                                         |  |                                     
|---------------------------------------- |  | ------------------------------------
|                                        
|                                        
|                                        
|                                        
|Delaware                                 |  | 54-1807038                          
|(State of Incorporation)                 |  | (IRS Employer Identification Number)
|                                        
|                                        
|                                        
|                                        
|                                        
|7925 Jones Branch Drive, McLean, VA      |  | 22102                               
|(Address of principal executive offices) |  | (Zip Code)                          

Registrants telephone number, including area code:
(703) 873-2000

Not Applicable




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

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

Yes  X
          No

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PRECEDING FIVE YEARS:

Indicate by check mark whether the registrant has filed all
documents and reports required to be filed by Sections 12,
13 or 15(d) of the Securities Exchange Act of 1934 subsequent to
the distribution of securities under a plan confirmed by a court.

Yes  
          No

APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the
issuers classes of common stock, as of the latest
practicable date.

As of November 6, 2000 the registrant had outstanding
12,026,436 shares of Class A Common Stock, par value
$0.01 per share (the Class A Common Stock)
and 8,449,984 shares of Class B Common Stock, par
value $0.01 per share (the Class B Common
Stock).



---






---

TABLE OF CONTENTS



|                                                                                              |                              |  |  |  |  |  |  | 
|--------------------------------------------------------------------------------------------- | ---------------------------- |  |  |  |  |  |  | 
|PART I: FINANCIAL INFORMATION                                                                
|                                                                                              | Item 1: Financial Statements
|Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
|PART II: OTHER INFORMATION                                                                   
|                                                                                              | Item 1: Legal Proceedings   
|                                                                                              | Signature                   
|Computations Of Earnings Per Share                                                           
|Financial Data Schedule                                                                      



---



LCC International, Inc. and Subsidiaries

Quarterly Report on Form 10-Q

For the quarter ended September 30, 2000


INDEX

|         |  |                                                                                                                  |  |        |    | 
|-------- |  | ---------------------------------------------------------------------------------------------------------------- |  | ------ | -- | 
|         |  |                                                                                                                  |  | Page  
|         |  |                                                                                                                  |  | Number
|         |  |                                                                                                                  |  |       
|PART I:  |  | FINANCIAL INFORMATION                                                                                            |  |        |    | 
|        
|        
|        
|        
|ITEM 1:  |  | FINANCIAL STATEMENTS                                                                                             |  |        |    | 
|        
|        
|        
|        
|         |  | Condensed consolidated statements of operations for the three
	and nine months ended September 30, 1999 and 2000 |  |        | 3  | 
|        
|        
|        
|        
|         |  | Condensed consolidated balance sheets as of December 31,
	1999 and September 30, 2000                            |  |        | 4  | 
|        
|        
|        
|        
|         |  | Condensed consolidated statements of cash flows for the nine
	months ended September 30, 1999 and 2000           |  |        | 5  | 
|        
|        
|        
|        
|         |  | Notes to condensed consolidated financial statements                                                             |  |        | 6  | 
|        
|        
|        
|        
|ITEM 2:  |  | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
	AND RESULTS OF OPERATIONS                           |  |        | 10 | 
|        
|        
|        
|        
|PART II: |  | OTHER INFORMATION                                                                                                |  |        |    | 
|        
|        
|        
|        
|ITEM 1:  |  | Legal Proceedings                                                                                                |  |        | 15 | 
|        
|        
|        
|        
|ITEM 2:  |  | Changes in Securities                                                                                            |  |        | 15 | 
|        
|        
|        
|        
|ITEM 3:  |  | Defaults Upon Senior Securities                                                                                  |  |        | 15 | 
|        
|        
|        
|        
|ITEM 4:  |  | Submission Of Matters to a Vote of Security Holders                                                              |  |        | 15 | 
|        
|        
|        
|        
|ITEM 5:  |  | Other Information                                                                                                |  |        | 15 | 
|        
|        
|        
|        
|ITEM 6:  |  | Exhibits and Reports on Form 8-K                                                                                 |  |        | 15 | 

2



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##### Table of Contents






PART I:  FINANCIAL INFORMATION






Item 1:  Financial Statements


LCC International, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations

(In thousands, except per share data)


(Unaudited)


|                                                  |                                              |                    |        |                   |   |      |        |        |   |   |        |        |   |   |         |         |  
|------------------------------------------------- | -------------------------------------------- | ------------------ | ------ | ----------------- | - | ---- | ------ | ------ | - | - | ------ | ------ | - | - | ------- | ------- | -
|                                                  |                                              |                    |        |                  
|                                                  |                                              | Three Months Ended |        | Nine Months Ended
|                                                  |                                              | September 30,      |        | September 30,    
|                                                  |                                              |                    |        |                  
|                                                  |                                              | 1999               |        | 2000              |   | 1999 |        | 2000  
|                                                  |                                              |                    |        |                   |   |      |        |       
|REVENUES:                                         |                                              |                    |        |                   |   |      |        |        |   |   |        |        |   |   |         |        
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Services                                     |                    | $      | 17,437            |   |      | $      | 40,912 |   |   | $      | 50,561 |   |   | $       | 104,359 |  
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Tower ownership and management               |                    |        | 805               |   |      |        | 25     |   |   |        | 1,485  |   |   |         | 1,008   |  
|                                                  |                                              |                    |        |                   |   |      |        |        |   |   |        |        |   |   |         |        
|                                                  |                                              |                    | 18,242 |                   |   |      | 40,937 |        |   |   | 52,046 |        |   |   | 105,367 |        
|                                                  |                                              |                    |        |                   |   |      |        |        |   |   |        |        |   |   |         |        
|COST OF REVENUES:                                 |                                              |                    |        |                   |   |      |        |        |   |   |        |        |   |   |         |        
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Services                                     |                    |        | 13,091            |   |      |        | 29,886 |   |   |        | 37,053 |   |   |         | 76,326  |  
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Tower ownership and management               |                    |        | 276               |   |      |        | 10     |   |   |        | 801    |   |   |         | 333     |  
|                                                  |                                              |                    |        |                   |   |      |        |        |   |   |        |        |   |   |         |        
|                                                  |                                              |                    | 13,367 |                   |   |      | 29,896 |        |   |   | 37,854 |        |   |   | 76,659  |        
|                                                  |                                              |                    |        |                   |   |      |        |        |   |   |        |        |   |   |         |        
|GROSS PROFIT                                      |                                              |                    | 4,875  |                   |   |      | 11,041 |        |   |   | 14,192 |        |   |   | 28,708  |        
|                                                  |                                              |                    |        |                   |   |      |        |        |   |   |        |        |   |   |         |        
|OPERATING EXPENSES:                               |                                              |                    |        |                   |   |      |        |        |   |   |        |        |   |   |         |        
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Sales and marketing                          |                    |        | 1,259             |   |      |        | 1,934  |   |   |        | 4,058  |   |   |         | 6,081   |  
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | General and administrative                   |                    |        | 4,046             |   |      |        | 5,292  |   |   |        | 13,544 |   |   |         | 14,146  |  
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Tower portfolio sale and administration, net |                    |        |                  |   |      |        | (889   | ) |   |        |       |   |   |         | (26,195 | )
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Depreciation and amortization                |                    |        | 955               |   |      |        | 621    |   |   |        | 2,495  |   |   |         | 2,213   |  
|                                                  |                                              |                    |        |                   |   |      |        |        |   |   |        |        |   |   |         |        
|                                                  |                                              |                    | 6,260  |                   |   |      | 6,958  |        |   |   | 20,097 |        |   |   | (3,755  | )      
|                                                  |                                              |                    |        |                   |   |      |        |        |   |   |        |        |   |   |         |        
|OPERATING INCOME (LOSS)                           |                                              |                    | (1,385 | )                 |   |      | 4,083  |        |   |   | (5,905 | )      |   |   | 32,463  |        
|                                                  |                                              |                    |        |                   |   |      |        |        |   |   |        |        |   |   |         |        
|OTHER INCOME (EXPENSE):                           |                                              |                    |        |                   |   |      |        |        |   |   |        |        |   |   |         |        
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Interest income                              |                    |        | 207               |   |      |        | 623    |   |   |        | 427    |   |   |         | 1,441   |  
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Interest expense                             |                    |        | (428              | ) |      |        | (6     | ) |   |        | (2,023 | ) |   |         | (261    | )
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Other expense                                |                    |        | (54               | ) |      |        | (287   | ) |   |        | (1,398 | ) |   |         | (850    | )
|                                                  |                                              |                    |        |                   |   |      |        |        |   |   |        |        |   |   |         |        
|                                                  |                                              |                    | (275   | )                 |   |      | 330    |        |   |   | (2,994 | )      |   |   | 330     |        
|                                                  |                                              |                    |        |                   |   |      |        |        |   |   |        |        |   |   |         |        
|INCOME (LOSS) FROM OPERATIONS BEFORE INCOME TAXES |                                              |                    | (1,660 | )                 |   |      | 4,413  |        |   |   | (8,899 | )      |   |   | 32,793  |        
|                                                 
|                                                 
|                                                 
|                                                 
|PROVISION (BENEFIT) FOR INCOME TAXES              |                                              |                    | (500   | )                 |   |      | 2,509  |        |   |   | (2,680 | )      |   |   | 14,429  |        
|                                                  |                                              |                    |        |                   |   |      |        |        |   |   |        |        |   |   |         |        
|NET INCOME (LOSS)                                 |                                              | $                  | (1,160 | )                 |   | $    | 1,904  |        |   | $ | (6,219 | )      |   | $ | 18,364  |        
|                                                  |                                              |                    |        |                   |   |      |        |        |   |   |        |        |   |   |         |        
|NET INCOME (LOSS) PER SHARE:                      |                                              |                    |        |                   |   |      |        |        |   |   |        |        |   |   |         |        
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Basic                                        |                    | $      | (0.06             | ) |      | $      | 0.09   |   |   | $      | (0.38  | ) |   | $       | 0.90    |  
|                                                  |                                              |                    |        |                   |   |      |        |        |   |   |        |        |   |   |         |        
|                                                  | Diluted                                      |                    | $      | (0.06             | ) |      | $      | 0.09   |   |   | $      | (0.38  | ) |   | $       | 0.82    |  
|                                                  |                                              |                    |        |                   |   |      |        |        |   |   |        |        |   |   |         |        
|WEIGHTED AVERAGE SHARES USED IN CALCULATION       |                                              |                    |        |                   |   |      |        |        |   |   |        |        |   |   |         |        
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | OF NET INCOME (LOSS) PER SHARE:              |                    |        |                   |   |      |        |        |   |   |        |        |   |   |         |         |  
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Basic                                        |                    |        | 18,133            |   |      |        | 20,417 |   |   |        | 16,487 |   |   |         | 20,320  |  
|                                                  |                                              |                    |        |                   |   |      |        |        |   |   |        |        |   |   |         |        
|                                                  | Diluted                                      |                    |        | 18,133            |   |      |        | 22,368 |   |   |        | 16,487 |   |   |         | 22,363  |  
|                                                  |                                              |                    |        |                   |   |      |        |        |   |   |        |        |   |   |         |        

See accompanying notes to condensed consolidated financial
statements.

3



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##### Table of Contents



LCC International, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(In thousands)


|                                                                                 |                                                                                                                                        |                                         |         |               |        |   |         |        |        | 
|-------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------- | ------- | ------------- | ------ | - | ------- | ------ | ------ | 
|                                                                                 |                                                                                                                                        | December 31,                            |         | September 30,
|                                                                                 |                                                                                                                                        | 1999                                    |         | 2000         
|                                                                                 |                                                                                                                                        |                                         |         |              
|                                                                                 |                                                                                                                                        |                                         |         | (Unaudited)  
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|ASSETS:                                                                          |                                                                                                                                        |                                         |         |               |        |   |         |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Current assets:                                                                  |                                                                                                                                        |                                         |         |               |        |   |         |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | Cash and cash equivalents                                                                                                              |                                         | $       | 1,951         |        |   | $       | 24,495 |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | Short-term investments                                                                                                                 |                                         |         | 86            |        |   |         | 15,556 |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | Receivables, net of allowance for doubtful accounts of $7,860
	and $1,751 at December 31, 1999 and September 30,
	2000, respectively:  |                                         |         |               |        |   |         |        |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 |                                                                                                                                        | Trade accounts receivable               |         |               | 15,052 |   |         |        | 25,406 | 
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 |                                                                                                                                        | Due from related parties and affiliates |         |               | 836    |   |         |        | 1,402  | 
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 |                                                                                                                                        | Unbilled receivables                    |         |               | 5,187  |   |         |        | 15,815 | 
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | Deferred income taxes, net                                                                                                             |                                         |         | 5,083         |        |   |         | 2,958  |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | Prepaid expenses and other current assets                                                                                              |                                         |         | 3,202         |        |   |         | 2,721  |       
|                                                                                 |                                                                                                                                        |                                         |         |               |        |   |         |       
|                                                                                 |                                                                                                                                        | Total current assets                    |         |               | 31,397 |   |         |        | 88,353 | 
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Property and equipment, net                                                      |                                                                                                                                        |                                         | 37,762  |               |        |   | 5,432   |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Investments                                                                      |                                                                                                                                        |                                         | 1,095   |               |        |   | 3,627   |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Deferred income taxes, net                                                       |                                                                                                                                        |                                         | 11,562  |               |        |   | 4,753   |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Other assets                                                                     |                                                                                                                                        |                                         | 1,052   |               |        |   | 571     |       
|                                                                                 |                                                                                                                                        |                                         |         |               |        |   |         |       
|                                                                                 |                                                                                                                                        | $                                       | 82,868  |               |        | $ | 102,736 |       
|                                                                                 |                                                                                                                                        |                                         |         |               |        |   |         |       
|LIABILITIES AND SHAREHOLDERS EQUITY:                                            |                                                                                                                                        |                                         |         |               |        |   |         |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Current liabilities:                                                             |                                                                                                                                        |                                         |         |               |        |   |         |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | Line of credit                                                                                                                         |                                         | $       | 4,535         |        |   | $       |       |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | Accounts payable                                                                                                                       |                                         |         | 4,565         |        |   |         | 3,821  |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | Accrued expenses                                                                                                                       |                                         |         | 7,567         |        |   |         | 7,202  |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | Accrued employee compensation and benefits                                                                                             |                                         |         | 13,516        |        |   |         | 13,074 |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | Deferred revenue                                                                                                                       |                                         |         | 780           |        |   |         | 759    |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | Income taxes payable                                                                                                                   |                                         |         | 5,844         |        |   |         | 4,517  |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | Other current liabilities                                                                                                              |                                         |         | 2,629         |        |   |         | 864    |       
|                                                                                 |                                                                                                                                        |                                         |         |               |        |   |         |       
|                                                                                 |                                                                                                                                        | Total current liabilities               |         |               | 39,436 |   |         |        | 30,237 | 
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | Other liabilities                                                                                                                      |                                         |         | 1,006         |        |   |         | 6,000  |       
|                                                                                 |                                                                                                                                        |                                         |         |               |        |   |         |       
|                                                                                 |                                                                                                                                        | Total liabilities                       |         |               | 40,442 |   |         |        | 36,237 | 
|                                                                                 |                                                                                                                                        |                                         |         |               |        |   |         |       
|Preferred stock:                                                                 |                                                                                                                                        |                                         |         |               |        |   |         |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | 10,000 shares authorized; -0- shares issued and outstanding                                                                            |                                         |         |              |        |   |         |       |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Class A common stock, $0.01 par value:                                           |                                                                                                                                        |                                         |         |               |        |   |         |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | 70,000 shares authorized; 11,630 and 12,003 shares
	issued and outstanding at December 31, 1999 and
	September  30, 2000, respectively |                                         |         | 116           |        |   |         | 120    |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Class B common stock, $0.01 par value:                                           |                                                                                                                                        |                                         |         |               |        |   |         |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | 20,000 shares authorized; 8,461 and 8,450 shares
	issued and outstanding at December 31, 1999 and
	September 30, 2000, respectively    |                                         |         | 85            |        |   |         | 85     |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Paid-in capital                                                                  |                                                                                                                                        |                                         | 85,846  |               |        |   | 91,377  |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Accumulated deficit                                                              |                                                                                                                                        |                                         | (38,999 | )             |        |   | (20,635 | )     
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Notes receivable from shareholders                                               |                                                                                                                                        |                                         | (3,025  | )             |        |   | (2,325  | )     
|                                                                                 |                                                                                                                                        |                                         |         |               |        |   |         |       
|                                                                                 | Subtotal                                                                                                                               |                                         |         | 44,023        |        |   |         | 68,622 |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Accumulated other comprehensive loss  foreign
	currency translation adjustments |                                                                                                                                        |                                         | (1,597  | )             |        |   | (2,123  | )     
|                                                                                 |                                                                                                                                        |                                         |         |               |        |   |         |       
|                                                                                 |                                                                                                                                        | Total shareholders equity              |         |               | 42,426 |   |         |        | 66,499 | 
|                                                                                 |                                                                                                                                        |                                         |         |               |        |   |         |       
|                                                                                 |                                                                                                                                        | $                                       | 82,868  |               |        | $ | 102,736 |       
|                                                                                 |                                                                                                                                        |                                         |         |               |        |   |         |       

See accompanying notes to condensed consolidated financial
statements.

4



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##### Table of Contents



LCC International, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(In thousands)


(Unaudited)


|                                                                     |                                                                                                              |                                              |                                          |         |       |        |         |         |         |         |  
|-------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------ | -------------------------------------------- | ---------------------------------------- | ------- | ----- | ------ | ------- | ------- | ------- | ------- | -
|                                                                     |                                                                                                              |                                             
|                                                                     |                                                                                                              | Nine Months Ended                           
|                                                                     |                                                                                                              | September 30,                               
|                                                                     |                                                                                                              |                                             
|                                                                     |                                                                                                              | 1999                                         |                                          | 2000   
|                                                                     |                                                                                                              |                                              |                                          |        
|Cash flows from operating activities:                                |                                                                                                              |                                              |                                          |         |       |        |         |        
|                                                                    
|                                                                    
|                                                                    
|                                                                    
|                                                                     | Net income (loss)                                                                                            |                                              | $                                        | (6,219  | )     |        | $       | 18,364  |        
|                                                                    
|                                                                    
|                                                                    
|                                                                    
|                                                                     | Adjustments to reconcile income (loss) from continuing
	operations to net cash used in operating activities: |                                              |                                          |         |       |        |         |         |        
|                                                                    
|                                                                    
|                                                                    
|                                                                    
|                                                                     |                                                                                                              | Depreciation and amortization                |                                          |         | 2,495 |        |         |         | 2,213   |        
|                                                                    
|                                                                    
|                                                                    
|                                                                    
|                                                                     |                                                                                                              | Deferred income taxes                        |                                          |         |      |        |         |         | 13,789  |        
|                                                                    
|                                                                    
|                                                                    
|                                                                    
|                                                                     |                                                                                                              | Gain on sale of tower portfolio              |                                          |         |      |        |         |         | (26,195 | )      
|                                                                    
|                                                                    
|                                                                    
|                                                                    
|                                                                     |                                                                                                              | Changes in operating assets and liabilities: |                                          |         |       |        |         |         |         |        
|                                                                    
|                                                                    
|                                                                    
|                                                                    
|                                                                     |                                                                                                              |                                              | Trade, unbilled, and other receivables   |         |       | (231   | )       |         |         | (22,124 | )
|                                                                    
|                                                                    
|                                                                    
|                                                                    
|                                                                     |                                                                                                              |                                              | Accounts payable and accrued expenses    |         |       | 2,280  |         |         |         | (2,275  | )
|                                                                    
|                                                                    
|                                                                    
|                                                                    
|                                                                     |                                                                                                              |                                              | Other current assets and liabilities     |         |       | 8,008  |         |         |         | (2,528  | )
|                                                                    
|                                                                    
|                                                                    
|                                                                    
|                                                                     |                                                                                                              |                                              | Other non-current assets and liabilities |         |       | (7,668 | )       |         |         | (686    | )
|                                                                     |                                                                                                              |                                              |                                          |         |       |        |         |        
|Net cash used in operating activities                                |                                                                                                              |                                              | (1,335                                   | )       |       |        | (19,442 | )      
|                                                                     |                                                                                                              |                                              |                                          |         |       |        |         |        
|Cash flows from investing activities:                                |                                                                                                              |                                              |                                          |         |       |        |         |        
|                                                                    
|                                                                    
|                                                                    
|                                                                    
|                                                                     | Increase in short-term investments, net                                                                      |                                              |                                          |        |       |        |         | (15,470 | )      
|                                                                    
|                                                                    
|                                                                    
|                                                                    
|                                                                     | Purchases of property and equipment                                                                          |                                              |                                          | (14,659 | )     |        |         | (3,425  | )      
|                                                                    
|                                                                    
|                                                                    
|                                                                    
|                                                                     | Proceeds from tower portfolio sale, net of expenses                                                          |                                              |                                          |        |       |        |         | 72,176  |        
|                                                                    
|                                                                    
|                                                                    
|                                                                    
|                                                                     | Purchase of minority interest                                                                                |                                              |                                          |        |       |        |         | (7,174  | )      
|                                                                    
|                                                                    
|                                                                    
|                                                                    
|                                                                     | Proceeds from sale of property and equipment                                                                 |                                              |                                          |        |       |        |         | 209     |        
|                                                                    
|                                                                    
|                                                                    
|                                                                    
|                                                                     | Investments                                                                                                  |                                              |                                          | (1,100  | )     |        |         | (2,532  | )      
|                                                                     |                                                                                                              |                                              |                                          |         |       |        |         |        
|Net cash provided by (used in) investing activities                  |                                                                                                              |                                              | (15,759                                  | )       |       |        | 43,784  |        
|                                                                     |                                                                                                              |                                              |                                          |         |       |        |         |        
|Cash flows from financing activities:                                |                                                                                                              |                                              |                                          |         |       |        |         |        
|                                                                    
|                                                                    
|                                                                    
|                                                                    
|                                                                     | Proceeds from issuance of common stock, net                                                                  |                                              |                                          | 361     |       |        |         | 435     |        
|                                                                    
|                                                                    
|                                                                    
|                                                                    
|                                                                     | Proceeds from exercise of options                                                                            |                                              |                                          | 108     |       |        |         | 1,502   |        
|                                                                    
|                                                                    
|                                                                    
|                                                                    
|                                                                     | Payments on line of credit                                                                                   |                                              |                                          | (5,484  | )     |        |         | (14,235 | )      
|                                                                    
|                                                                    
|                                                                    
|                                                                    
|                                                                     | Proceeds from line of credit                                                                                 |                                              |                                          | 25,161  |       |        |         | 9,700   |        
|                                                                    
|                                                                    
|                                                                    
|                                                                    
|                                                                     | Repayment of loan from shareholder                                                                           |                                              |                                          |        |       |        |         | 800     |        
|                                                                     |                                                                                                              |                                              |                                          |         |       |        |         |        
|Net cash provided by (used in) financing activities                  |                                                                                                              |                                              | 20,146                                   |         |       |        | (1,798  | )      
|                                                                     |                                                                                                              |                                              |                                          |         |       |        |         |        
|Net increase in cash and cash equivalents  continuing
	operations   |                                                                                                              |                                              | 3,052                                    |         |       |        | 22,544  |        
|                                                                    
|                                                                    
|                                                                    
|                                                                    
|Net decrease in cash and cash equivalents 
	discontinued operations |                                                                                                              |                                              | (4,245                                   | )       |       |        |        |        
|                                                                     |                                                                                                              |                                              |                                          |         |       |        |         |        
|Net increase (decrease) in cash and cash equivalents                 |                                                                                                              |                                              | (1,193                                   | )       |       |        | 22,544  |        
|                                                                    
|                                                                    
|                                                                    
|                                                                    
|Cash and cash equivalents at beginning of period                     |                                                                                                              |                                              | 4,240                                    |         |       |        | 1,951   |        
|                                                                     |                                                                                                              |                                              |                                          |         |       |        |         |        
|Cash and cash equivalents at end of period                           |                                                                                                              | $                                            | 3,047                                    |         |       | $      | 24,495  |        
|                                                                     |                                                                                                              |                                              |                                          |         |       |        |         |        
|Supplemental disclosures of cash flow information:                   |                                                                                                              |                                              |                                          |         |       |        |         |        
|                                                                    
|                                                                    
|                                                                    
|                                                                    
|                                                                     | Cash paid during the nine months for:                                                                        |                                              |                                          |         |       |        |         |         |        
|                                                                    
|                                                                    
|                                                                    
|                                                                    
|                                                                     |                                                                                                              | Interest                                     |                                          | $       | 1,573 |        |         | $       | 148     |        
|                                                                    
|                                                                    
|                                                                    
|                                                                    
|                                                                     |                                                                                                              | Income taxes                                 |                                          |         | 2,760 |        |         |         | 1,980   |        

Supplemental disclosures of non-cash investing
and financing activities:

In July 1999, the Company issued
approximately 2.8 million shares of Class A common
stock in exchange for its 4.4% convertible subordinated notes.
As a result both long-term debt and long-term deferred tax
assets were reduced by $50.0 million and
$12.6 million, respectively and shareholders equity
increased $37.4 million.

In August 1999, the Company issued
approximately 0.9 million shares of Class A common stock in
exchange for its 9.0% convertible notes payable. As a result,
current debt was reduced by $5.0 million, accrued interest
$0.2 million, and shareholders equity increased
$5.2 million.

See accompanying notes to condensed consolidated financial
statements.

5



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##### Table of Contents



LCC International, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)


Note 1:  Description of Operations

LCC International, Inc. and subsidiaries (also referred to
herein as the Company) is a leading provider of
end-to-end services relating to the design, engineering,
deployment and operation of wireless communications systems.

The Company operates in a highly competitive environment subject
to rapid technological change and emergence of new technologies.
Future revenues are dependent upon the re-engineering of
existing wireless communications systems, introduction of
existing wireless technologies into new markets, the entrance of
new wireless providers into existing markets, the introduction
of new technologies and the recruiting, training and retention
of management and professional staff. Although the Company
believes that its services are transferable to emerging
technologies, rapid changes in technology could have an adverse
financial impact on the Company.

Note 2:  Basis of Presentation

The condensed consolidated financial statements of LCC
International, Inc. and subsidiaries included herein have been
prepared by the Company without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission and
reflect all adjustments which are, in the opinion of management,
necessary for a fair presentation of the results for the interim
period.

Certain information and footnote disclosure normally included in
the financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted.
The interim financial statements should be read in conjunction
with the consolidated financial statements and notes thereto
included in the Companys Annual Report on Form 10-K
for the fiscal year ended December 31, 1999. Operating
results for the interim periods are not necessarily indicative
of results for an entire year.

Certain reclassifications of prior year amounts have been made
to conform with the current year presentation.

Note 3:  Other Comprehensive Income (Loss)

During the first quarter of 1998, the Company adopted Statement
of Financial Accounting Standards No. 130 (SFAS
No. 130), Reporting Comprehensive Income,which established standards for reporting and displaying
comprehensive income and its components in the financial
statements. Comprehensive income is defined as net income plus
the change in equity of a business enterprise during a period
from transactions and other events and circumstances from
non-owner sources. Other comprehensive income refers to
revenues, expenses, gains and losses that under generally
accepted accounting principles are included in comprehensive
income, but excluded from net income. Other comprehensive income
consists solely of foreign currency

6



---



##### Table of Contents





|                                                            |  |               |        |                   |  |      |       |      |  |   |        |   |  |   |        |  
|----------------------------------------------------------- |  | ------------- | ------ | ----------------- |  | ---- | ----- | ---- |  | - | ------ | - |  | - | ------ | -
|                                                            |  |               |        |                   |  |     
|                                                            |  | Three Months  |        |                  
|                                                            |  | Ended         |        | Nine Months Ended
|                                                            |  | September 30, |        | September 30,    
|                                                            |  |               |        |                  
|                                                            |  | 1999          |        | 2000              |  | 1999 |       | 2000
|                                                            |  |               |        |                   |  |      |       |     
|Net income (loss)                                           |  | $             | (1,160 | )                 |  | $    | 1,904 |      |  | $ | (6,219 | ) |  | $ | 18,364 |  
|                                                            |  |               |        |                   |  |      |       |      |  |   |        |   |  |   |        |  
|Other comprehensive loss, before tax                        |  |               | (160   | )                 |  |      | (602  | )    |  |   | (360   | ) |  |   | (940   | )
|                                                           
|                                                           
|                                                           
|                                                           
|Income tax benefit related to items of comprehensive income |  |               | (48    | )                 |  |      | (265  | )    |  |   | (108   | ) |  |   | (414   | )
|                                                            |  |               |        |                   |  |      |       |      |  |   |        |   |  |   |        |  
|Other comprehensive loss, net of tax                        |  |               | (112   | )                 |  |      | (337  | )    |  |   | (252   | ) |  |   | (526   | )
|                                                            |  |               |        |                   |  |      |       |      |  |   |        |   |  |   |        |  
|Comprehensive income (loss)                                 |  | $             | (1,272 | )                 |  | $    | 1,567 |      |  | $ | (6,471 | ) |  | $ | 17,838 |  
|                                                            |  |               |        |                   |  |      |       |      |  |   |        |   |  |   |        |  

Note 4:  Investments in Unconsolidated
Affiliates

In September 1999, the Company, through its wholly-owned
subsidiary, LCC, United Kingdom, Limited, acquired 19.9% of
Tecnosistemi S.p.A. (Tecnosistemi) (formerly,
Italtel Sistemi, S.p.A.) for $1.1 million. Tecnosistemi is
an Italian telecommunications services company, and is a
recently spun off division of the Italtel Group whose major
shareholders were Siemens and Telecom Italia. The Company, until
September 2000, applied the equity method to account for
its investment in Tecnosistemi. Tecnosistemi incurred cumulative
losses since the date of acquisition through September 30,
2000 of $3.4 million. The Company recorded a loss in other
income (expense) of $0.8 million related to its
pro-rata share of the losses generated by Tecnosistemi since the
date of acquisition. During September 2000, Tecnosistemi
merged into Tecneudosia S.p.A. As a result of the merger, the
Companys ownership percentage was decreased to 9.4% and
the Company discontinued application of the equity method.

In June 2000, the Company acquired 18.2% of Mobilocity,
Inc. (Mobilocity) for $0.5 million. Mobilocity
provides mobile-business strategic consulting and implementation
services. During August 2000, the Companys ownership
percentage was diluted to 3.1% as Mobilocity raised additional
capital, as planned, through issuance of additional stock. The
Company uses the cost method to account for this investment.

In August 2000, the Company acquired 15.0% of Plan + Design
Netcare AG (PDN) for $2.9 million. PDN is a
German wireless network deployment firm. In addition to the
investment, the Company entered into a five-year joint marketing
agreement with PDN. The Company uses the cost method to account
for this investment.

Note 5:  Tower Portfolio Sale and
Administration

During March 2000, Microcell Management, Inc.
(Microcell), a subsidiary of the Company, completed
the initial closing of the sale of its telecommunication tower
portfolio to Pinnacle Towers Inc. (Pinnacle)
pursuant to an Asset Purchase Agreement between Pinnacle and
Microcell. Pursuant to the Asset Purchase Agreement, Microcell
agreed to sell up to 197 tower sites owned or to be constructed
by Microcell for a total purchase price of up to
$80 million in cash payable as the sites are conveyed to
Pinnacle. As of September 30, 2000, 177 tower sites were
conveyed to Pinnacle for net proceeds of $72.2 million.
While some portion of the remaining towers may convey
periodically through year-end, the Company believes
substantially all of the towers that will convey have been
conveyed to Pinnacle. As a part of the sale transaction,
Microcell and Pinnacle entered into a Master Antenna Site Lease
pursuant to which Microcell has agreed to lease, until
December 31, 2002, the unoccupied space on each
telecommunication tower sold to Pinnacle. The Company has
deferred $5.2 million of the gain from the tower sales
through September, which relate to the maximum lease obligations
under the Master Antenna Site Lease. These amounts are included
in other long-term obligations. Microcell and Pinnacle have also
entered into a Tower Services Agreement pursuant to which
Microcell will provide Pinnacle with audit, maintenance, and
program management services regarding site improvements and
capacity upgrades for an initial 204 sites and additional sites
that may be added by mutual agreement. The Services Agreement
provides for minimum annual payments to Microcell of

7



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##### Table of Contents





On February 15, 2000, Microcell and the Company entered
into a Settlement and Release Agreement (Settlement
Agreement) with the minority shareholders of Microcell.
Pursuant to the Settlement Agreement, concurrent with the
Pinnacle tower sale, the aggregate 16.25% minority shareholder
interests were redeemed and other costs paid and/or reimbursed
for $7.2 million. The payment was capitalized as part of
the Microcell assets and will be expensed as sites are conveyed
to Pinnacle. As part of the settlement, all pending claims of
the minority shareholders were settled and dismissed with
prejudice (see note 6).

Note 6:  Contingencies

The Company is party to various non-material legal proceedings
and claims incidental to its business.

Albert Grimes et al. v. LCC International, Inc. et al.,
Civil Action No. 16957-NC, in the Court of Chancery of the
State of Delaware, Castle County. On February 12, 1999, the
minority shareholders of the Companys majority-owned
Microcell subsidiary filed a suit against the Company, the
directors appointed by the Company to the Microcell Board and
Microcell itself, seeking rescission of the shareholders
agreement between the Company and the minority shareholders
(which concerns management of Microcell, funding commitments and
other matters), the appointment of a custodian or receiver, and
unspecified monetary damages. In connection with the sale of the
Company towers to Pinnacle Towers, Inc., the parties settled all
pending litigation, and all claims were dismissed with prejudice
on March 7, 2000.

Note 7:  Recent Accounting Pronouncements

During June 1998, the Financial Accounting Standards Board
(FASB) issued SFAS No. 133, Accounting for
Derivative Instruments and Hedging Activities. SFAS
No. 133, as amended by SFAS No. 137 and further
amended by SFAS No. 138, established accounting and
reporting standards for derivative financial instruments and
associated hedging activities as well as hedging activities in
general. The Company does not have any derivative instruments,
and as such does not expect the adoption of SFAS No. 133,
as amended, to have a material affect on its consolidated
financial statements.

Note 8:  Segment Information

The Companys operating segments include Services
(Engineering and Design Services, System Deployment Services,
and Tower Services and Management) and Tower Ownership and
Management. Engineering and Design Services provides engineering
and design services for cellular phone system operators,
personal communication system (PCS) operators and
other wireless communication systems providers. System
Deployment Services provides program and construction management
services related to the build-out of wireless communication
systems. Tower Services and Management offers site audit,
maintenance and project management services to
telecommunications tower owners. Tower Ownership and Management
builds, owns and manages telecommunications towers.

8



---



##### Table of Contents



Segment detail is summarized as follows (in thousands):

|                                |                         |               |        |                 |        |               |         |         |         |      |        |       |       |   |        |       |       |   |       |        |        |   |        |         |         | 
|------------------------------- | ----------------------- | ------------- | ------ | --------------- | ------ | ------------- | ------- | ------- | ------- | ---- | ------ | ----- | ----- | - | ------ | ----- | ----- | - | ----- | ------ | ------ | - | ------ | ------- | ------- | 
|                                |                         |               |        |                 |        |               |         |         |         |     
|                                |                         |               |        | Tower Ownership |        |              
|                                |                         | Services      |        | and Management  |        | Segment Total
|                                |                         |               |        |                 |        |              
|                                |                         | 1999          |        | 2000            |        | 1999          |         | 2000    |         | 1999 |        | 2000 
|                                |                         |               |        |                 |        |               |         |         |         |      |        |      
|Nine Months Ended September 30, |                         |               |        |                 |        |               |         |         |         |      |        |       |       |   |        |       |       |   |       |        |        |   |        |        
|                               
|                               
|                               
|                               
|Revenues:                       |                         |               |        |                 |        |               |         |         |         |      |        |       |       |   |        |       |       |   |       |        |        |   |        |        
|                               
|                               
|                               
|                               
|                                | From external customers |               | $      | 50,561          |        |               | $       | 104,359 |         |      | $      | 1,485 |       |   | $      | 1,008 |       |   | $     | 52,046 |        |   | $      | 105,367 |        
|                               
|                               
|                               
|                               
|                                | Inter-segment revenue   |               |        | 344             |        |               |         |        |         |      |        |      |       |   |        |      |       |   |       | 344    |        |   |        |        |        
|                                |                         |               |        |                 |        |               |         |         |         |      |        |       |       |   |        |       |       |   |       |        |        |   |        |        
|                                |                         | Total revenue |        | $               | 50,905 |               |         | $       | 104,359 |      |        | $     | 1,485 |   |        | $     | 1,008 |   |       | $      | 52,390 |   |        | $       | 105,367 | 
|                                |                         |               |        |                 |        |               |         |         |         |      |        |       |       |   |        |       |       |   |       |        |        |   |        |        
|Net income (loss)               |                         | $             | 5,771  |                 |        | $             | 12,311  |         |         | $    | (3,357 | )     |       | $ | 15,517 |       |       | $ | 2,414 |        |        | $ | 27,828 |        
|                                |                         |               |        |                 |        |               |         |         |         |      |        |       |       |   |        |       |       |   |       |        |        |   |        |        
|Total assets                    |                         | $             | 22,372 |                 |        | $             | 101,855 |         |         | $    | 30,796 |       |       | $ | 1,078  |       |       |   |       |        |        |   |        |        
|                                |                         |               |        |                 |        |               |         |         |         |      |        |       |       |   |        |       |       |   |       |        |        |   |        |        

|                                 |                         |               |       |                 |        |               |       |        |        |      |        |      |     |   |     |    |    |   |     |        |        |   |       |        |        | 
|-------------------------------- | ----------------------- | ------------- | ----- | --------------- | ------ | ------------- | ----- | ------ | ------ | ---- | ------ | ---- | --- | - | --- | -- | -- | - | --- | ------ | ------ | - | ----- | ------ | ------ | 
|                                 |                         |               |       |                 |        |               |       |        |        |     
|                                 |                         |               |       | Tower Ownership |        |              
|                                 |                         | Services      |       | and Management  |        | Segment Total
|                                 |                         |               |       |                 |        |              
|                                 |                         | 1999          |       | 2000            |        | 1999          |       | 2000   |        | 1999 |        | 2000
|                                 |                         |               |       |                 |        |               |       |        |        |      |        |     
|Three Months Ended September 30, |                         |               |       |                 |        |               |       |        |        |      |        |      |     |   |     |    |    |   |     |        |        |   |       |       
|                                
|                                
|                                
|                                
|Revenues:                        |                         |               |       |                 |        |               |       |        |        |      |        |      |     |   |     |    |    |   |     |        |        |   |       |       
|                                
|                                
|                                
|                                
|                                 | From external customers |               | $     | 17,437          |        |               | $     | 40,912 |        |      | $      | 805  |     |   | $   | 25 |    |   | $   | 18,242 |        |   | $     | 40,937 |       
|                                
|                                
|                                
|                                
|                                 | Inter-segment revenue   |               |       | 42              |        |               |       |       |        |      |        |     |     |   |     |   |    |   |     | 42     |        |   |       |       |       
|                                 |                         |               |       |                 |        |               |       |        |        |      |        |      |     |   |     |    |    |   |     |        |        |   |       |       
|                                 |                         | Total revenue |       | $               | 17,479 |               |       | $      | 40,912 |      |        | $    | 805 |   |     | $  | 25 |   |     | $      | 18,284 |   |       | $      | 40,937 | 
|                                 |                         |               |       |                 |        |               |       |        |        |      |        |      |     |   |     |    |    |   |     |        |        |   |       |       
|Net income (loss)                |                         | $             | 1,655 |                 |        | $             | 4,917 |        |        | $    | (1,120 | )    |     | $ | 987 |    |    | $ | 535 |        |        | $ | 5,904 |       
|                                 |                         |               |       |                 |        |               |       |        |        |      |        |      |     |   |     |    |    |   |     |        |        |   |       |       

A reconciliation of net income (loss) reported for the
operating segments to the amount in the condensed consolidated
financial statements is as follows (in thousands):

|                                   |  |                    |        |                   |  |      |        |      |  |   |        |   |  |   |        |  
|---------------------------------- |  | ------------------ | ------ | ----------------- |  | ---- | ------ | ---- |  | - | ------ | - |  | - | ------ | -
|                                   |  |                    |        |                  
|                                   |  | Three Months Ended |        | Nine Months Ended
|                                   |  | September 30,      |        | September 30,    
|                                   |  |                    |        |                  
|                                   |  | 1999               |        | 2000              |  | 1999 |        | 2000
|                                   |  |                    |        |                   |  |      |        |     
|Segment total                      |  | $                  | 535    |                   |  | $    | 5,904  |      |  | $ | 2,414  |   |  | $ | 27,828 |  
|                                  
|                                  
|                                  
|                                  
|Unallocated corporate expenditures |  |                    | (1,693 | )                 |  |      | (4,000 | )    |  |   | (8,388 | ) |  |   | (9,464 | )
|                                  
|                                  
|                                  
|                                  
|Eliminations                       |  |                    | (2     | )                 |  |      |       |      |  |   | (245   | ) |  |   |       |  
|                                   |  |                    |        |                   |  |      |        |      |  |   |        |   |  |   |        |  
|Consolidated net income (loss)     |  | $                  | (1,160 | )                 |  | $    | 1,904  |      |  | $ | (6,219 | ) |  | $ | 18,364 |  
|                                   |  |                    |        |                   |  |      |        |      |  |   |        |   |  |   |        |  

9



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##### Table of Contents



LCC International, Inc. and Subsidiaries






Managements Discussion and Analysis of

Financial Condition and Results of Operations


For the Three and Nine Months Ended September 30, 1999
and 2000

This quarterly report on Form 10-Q contains forward-looking
statements within the meaning of Section 27A of the
Securities Exchange Act of 1934. The Managements
Discussion and Analysis of Financial Condition and Results of
Operations include, without limitation, forward-looking
statements regarding the Companys ability to pursue and
secure new business opportunities, its tower management business
and its working capital. A more complete discussion of business
risks is included in the Companys Annual Report on
Form 10-K for the year ended December 31, 1999.

Overview

The Company is one of the worlds largest independent
providers of Radio Frequency (RF) engineering and
system deployment services to the wireless telecommunications
industry. The Company has provided these services to operators
of more than 200 wireless systems in more than 50 countries. In
1996 the Company entered the tower ownership and management
business which consists of acquiring, developing and managing
telecommunications towers. The telecommunication towers were
sold in March 2000, and the Company repositioned this
operation to provide telecommunications site audits and
operation and management services.

The Companys revenues are generated through contracts for
RF engineering and system deployment services, and management
revenue from its tower ownership and management business. The
Company provides engineering design services on a contract
basis, usually in a customized plan for each client and
generally charges for engineering services on a time and
materials or fixed price basis. The Company generally provides
system deployment services on a time and materials or fixed
price basis. The Companys revenues also include
reimbursement for expenses, including the living expenses of
engineers on customer sites. The Company derives a significant
portion of its total revenues from its international customers.
To date, its tower ownership and management revenues have come
exclusively from the leasing of RF transmission towers in the
United States.

Cost of revenues consists of costs associated with engineering
design and system deployment services and direct costs related
to the tower ownership and management business. Sales and
marketing expenses consist of salaries, sales commissions,
bonuses, travel and other expenses required to implement the
Companys marketing, sales and customer support plans.
General and administrative expenses consist of the compensation,
benefits, office and occupancy, and other costs required for the
finance, human resources, information systems and executive
office functions.

The key drivers of the Companys growth have historically
been (i) the issuances of new or additional wireless
telecommunications licenses by governmental authorities to
wireless operators, (ii) increases in the number of cell
sites operated and the number of subscribers served by wireless
network operators, (iii) the introduction of new services
or technologies, (iv) the increasing complexity of the
systems deployed by wireless network operators, and (v) the
expansion and optimization of existing systems by wireless
network operators.

To keep pace with the subscriber growth currently anticipated by
most industry analysts, the Company expects that there will
continue to be significant investments by network system
operators over the next few years in design, system deployment
and tower services and management.

10



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##### Table of Contents



Results of Operations

The following table and discussion provide information which
management believes is relevant to an assessment and
understanding of the Companys consolidated results of
operations and financial condition. The discussion should be
read in conjunction with the condensed consolidated financial
statements and accompanying notes thereto included elsewhere
herein.

|                                                  |                                          |                              |      |                   |       |      |      |      |       |  |       |       |       |   |      |       |       |  
|------------------------------------------------- | ---------------------------------------- | ---------------------------- | ---- | ----------------- | ----- | ---- | ---- | ---- | ----- |  | ----- | ----- | ----- | - | ---- | ----- | ----- | -
|                                                  |                                          |                             
|                                                  |                                          | Percentage of Revenues      
|                                                  |                                          |                             
|                                                  |                                          |                              |      |                  
|                                                  |                                          | Three Months Ended           |      | Nine Months Ended
|                                                  |                                          | September 30,                |      | September 30,    
|                                                  |                                          |                              |      |                  
|                                                  |                                          | 1999                         |      | 2000              |       | 1999 |      | 2000
|                                                  |                                          |                              |      |                   |       |      |      |     
|Revenues:                                         |                                          |                              |      |                   |       |      |      |      |       |  |       |       |       |   |      |      
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Services                                 |                              |      | 95.6%             |       |      |      | 99.9 | %     |  |       | 97.1% |       |   |      | 99.0  | %    
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Tower ownership and management           |                              |      | 4.4               |       |      |      | 0.1  |       |  |       | 2.9   |       |   |      | 1.0   |      
|                                                  |                                          |                              |      |                   |       |      |      |      |       |  |       |       |       |   |      |      
|                                                  |                                          | Total revenues               |      |                   | 100.0 |      |      |      | 100.0 |  |       |       | 100.0 |   |      |       | 100.0 |  
|                                                  |                                          |                              |      |                   |       |      |      |      |       |  |       |       |       |   |      |      
|Cost of revenues:                                 |                                          |                              |      |                   |       |      |      |      |       |  |       |       |       |   |      |      
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Services                                 |                              |      | 71.8              |       |      |      | 73.0 |       |  |       | 71.2  |       |   |      | 72.4  |      
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Tower ownership and management           |                              |      | 1.5               |       |      |      | 0.0  |       |  |       | 1.5   |       |   |      | 0.3   |      
|                                                  |                                          |                              |      |                   |       |      |      |      |       |  |       |       |       |   |      |      
|                                                  |                                          | Total cost of revenues       |      |                   | 73.3  |      |      |      | 73.0  |  |       |       | 72.7  |   |      |       | 72.7  |  
|                                                  |                                          |                              |      |                   |       |      |      |      |       |  |       |       |       |   |      |      
|Gross profit:                                     |                                          |                              |      |                   |       |      |      |      |       |  |       |       |       |   |      |      
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Services                                 |                              |      | 23.8              |       |      |      | 26.9 |       |  |       | 25.9  |       |   |      | 26.6  |      
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Tower ownership and management           |                              |      | 2.9               |       |      |      | 0.1  |       |  |       | 1.4   |       |   |      | 0.7   |      
|                                                  |                                          |                              |      |                   |       |      |      |      |       |  |       |       |       |   |      |      
|                                                  |                                          | Total gross profit           |      |                   | 26.7  |      |      |      | 27.0  |  |       |       | 27.3  |   |      |       | 27.3  |  
|                                                  |                                          |                              |      |                   |       |      |      |      |       |  |       |       |       |   |      |      
|Operating expenses:                               |                                          |                              |      |                   |       |      |      |      |       |  |       |       |       |   |      |      
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Sales and marketing                      |                              |      | 6.9               |       |      |      | 4.7  |       |  |       | 7.8   |       |   |      | 5.8   |      
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | General and administrative               |                              |      | 22.2              |       |      |      | 12.9 |       |  |       | 26.0  |       |   |      | 13.4  |      
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Tower portfolio sale and operations, net |                              |      |                  |       |      |      | (2.2 | )     |  |       |      |       |   |      | (24.9 | )    
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Depreciation and amortization            |                              |      | 5.2               |       |      |      | 1.5  |       |  |       | 4.8   |       |   |      | 2.1   |      
|                                                  |                                          |                              |      |                   |       |      |      |      |       |  |       |       |       |   |      |      
|                                                  |                                          | Total operating expenses     |      |                   | 34.3  |      |      |      | 16.9  |  |       |       | 38.6  |   |      |       | (3.6  | )
|                                                  |                                          |                              |      |                   |       |      |      |      |       |  |       |       |       |   |      |      
|Operating income (loss)                           |                                          |                              | (7.6 | )                 |       |      | 10.1 |      |       |  | (11.3 | )     |       |   | 30.9 |      
|                                                  |                                          |                              |      |                   |       |      |      |      |       |  |       |       |       |   |      |      
|Other income (expense):                           |                                          |                              |      |                   |       |      |      |      |       |  |       |       |       |   |      |      
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Interest income                          |                              |      | 1.1               |       |      |      | 1.5  |       |  |       | 0.8   |       |   |      | 1.4   |      
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Interest expense                         |                              |      | (2.3              | )     |      |      | (0.0 | )     |  |       | (3.9  | )     |   |      | (0.2  | )    
|                                                 
|                                                 
|                                                 
|                                                 
|                                                  | Other                                    |                              |      | (0.3              | )     |      |      | (0.7 | )     |  |       | (2.7  | )     |   |      | (0.8  | )    
|                                                  |                                          |                              |      |                   |       |      |      |      |       |  |       |       |       |   |      |      
|                                                  |                                          | Total other income (expense) |      |                   | (1.5  | )    |      |      | 0.8   |  |       |       | (5.8  | ) |      |       | 0.4   |  
|                                                  |                                          |                              |      |                   |       |      |      |      |       |  |       |       |       |   |      |      
|Income (loss) from operations before income taxes |                                          |                              | (9.1 | )                 |       |      | 10.9 |      |       |  | (17.1 | )     |       |   | 31.3 |      
|                                                  |                                          |                              |      |                   |       |      |      |      |       |  |       |       |       |   |      |      
|Provision (benefit) for income taxes              |                                          |                              | (2.7 | )                 |       |      | 6.1  |      |       |  | (5.2  | )     |       |   | 13.7 |      
|                                                  |                                          |                              |      |                   |       |      |      |      |       |  |       |       |       |   |      |      
|Net income (loss)                                 |                                          |                              | (6.4 | )%                |       |      | 4.8  | %    |       |  | (11.9 | )%    |       |   | 17.6 | %    
|                                                  |                                          |                              |      |                   |       |      |      |      |       |  |       |       |       |   |      |      

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Three Months Ended September 30, 1999

Compared to


Three Months Ended September 30, 2000


Revenues. Revenues for the three months ended
September 30, 2000 were $40.9 million compared to
$18.2 million for the prior year, an increase of
$22.7 million or 124%. Increased revenue in North America
of $19.8 million was the largest contributor to the growth,
with the XM Satellite contract providing 67% of the North
American increase. Other North American growth of
$6.6 million was derived from radio frequency design
($1.6 million) and deployment ($5.0 million) services.
Also contributing to the increased revenue, was
$4.1 million of deployment services revenue generated in
the Middle East.

Cost of Revenues. Cost of revenues for the three months
ended September 30, 2000 was $29.9 million compared to
$13.4 million for the prior year, an increase of
$16.5 million or 124%. As a percentage of total revenues,
cost of revenues was 73.0% and 73.3% for 2000 and 1999,
respectively.

Gross Profit. Gross profit for the three months ended
September 30, 2000 was $11.0 million compared to
$4.9 million for the prior year, an increase of
$6.1 million or 126%. The gross profit increase is largely
attributable to the increase in revenues. As a percentage of
total revenues, gross profit was 27.0% and 26.7% for 2000 and
1999, respectively.

Sales and Marketing. Sales and marketing expenses were
$1.9 million for the three months ended September 30,
2000 compared to $1.3 million for the prior year, an
increase of $0.6 million. As a percentage of total
revenues, sales and marketing was 4.7% and 6.9% for 2000 and
1999, respectively. The increased revenue from large, end-to-end
service contracts enabled sales and marketing costs to increase
at a lower rate than revenue growth.

General and Administrative. General and administrative
expenses were $5.3 million for the three months ended
September 30, 2000 compared to $4.0 million for the
prior year, an increase of $1.3 million. The increase is
attributed to increased recruiting costs and human resources
costs in Europe and North America. As a percentage of total
revenues, general and administrative cost was 12.9% and 22.2%
for 2000 and 1999, respectively. The increased revenue from
large, end-to-end service contracts enabled general and
administrative costs to increase at a lower rate than revenue
growth.

Tower Portfolio Sale and Administration. During
February 2000, the Company entered into an agreement for
the sale of up to 197 tower sites owned or to be constructed for
a total purchase price of up to $80.0 million when the
sites are conveyed. During the current quarter, 7 tower sites
were successfully conveyed resulting in a net gain of
$0.9 million.

Depreciation and Amortization. Depreciation and
amortization expense was $0.6 million for the three months
ended September 30, 2000 compared to $1.0 million for
the prior year. The decrease is a result of a reduction in
assets due to the Companys tower portfolio sale.

Interest Income/ Expense. Interest income, net of
interest expense, was $0.6 million for the three months
ended September 30, 2000 compared to an expense of
$0.2 million for the prior year. The interest expense in
1999 was largely attributed to borrowings under the
Companys credit facility to finance the construction of
towers. The proceeds from the sale of the towers in 2000
provided sufficient proceeds to repay the Companys credit
facility and provide cash and cash equivalents that generated
interest income.

Other Expense. Other expense was $0.3 million for
the three months ended September 30, 2000 compared to an
expense of $0.06 million for the prior year. The other
expense in the current quarter is attributable to losses using
the equity method of accounting for the Companys 19.9%
investment in Tecnosistemi of $0.1 million and to foreign
currency losses of $0.2 million.

Provision (Benefit) for Income Taxes. The provision for
income taxes was $2.5 million for the three months ended
September 30, 2000 compared to a benefit of
$0.5 million for the prior year. The provision for income
taxes was recorded for the three months ended September 30,
2000 using an effective income tax rate of 56.9%. The effective
income tax rate for the quarter reflects an increase in the
effective income tax rate for the year from 42% to 44%,
resulting in an adjustment of $0.6 million. The increased
effective income tax rate

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##### Table of Contents





Net Income (Loss). Net income was $1.9 million for
the three months ended September 30, 2000 compared to a
loss of $1.2 million for the prior year. The increase in
net income was due to the increase in gross profit generated by
revenue growth.

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##### Table of Contents



Nine Months Ended September 30, 1999

Compared to


Nine Months Ended September 30, 2000


Revenues. Revenues for the nine months ended
September 30, 2000 were $105.4 million compared to
$52.1 million for the prior year, an increase of
$53.3 million or 102%. Increased revenue in North America
of $46.0 million was the largest contributor to the growth,
with the XM Satellite contract providing 77% of the North
American increase. Other North American growth of
$10.7 million was derived from radio frequency design
($4.0 million) and deployment ($6.7 million) services.
Also contributing to the increased revenue, was
$11.7 million of deployment services revenue generated in
the Middle East, offset by declines in Central and Latin America
($4.1 million).

Cost of Revenues. Cost of revenues for the nine months
ended September 30, 2000 was $76.7 million compared to
$37.9 million for the prior year, an increase of
$38.8 million or 103%. As a percentage of total revenues,
cost of revenues was 72.7% for both September 30, 2000 and
1999.

Gross Profit. Gross profit for the nine months ended
September 30, 2000 was $28.7 million compared to
$14.2 million for the prior year, an increase of
$14.5 million or 102%. The gross profit increase is largely
attributable to the increase in revenues. As a percentage of
total revenues, gross profit was 27.3% for both
September 30, 2000 and 1999.

Sales and Marketing. Sales and marketing expenses were
$6.1 million for the nine months ended September 30,
2000 compared to $4.1 million for the prior year, an
increase of $2.0 million. As a percentage of total
revenues, sales and marketing was 5.8% and 7.8% for 2000 and
1999, respectively. The increased revenue from large, end-to-end
service contracts enabled sales and marketing costs to increase
at a lower rate than revenue growth.

General and Administrative. General and administrative
expenses were $14.1 million for the nine months ended
September 30, 2000 compared to $13.5 million for the
prior year, an increase of $0.6 million. As a percentage of
total revenues, general and administrative cost was 13.4% and
26.0% for 2000 and 1999, respectively. General and
administrative expenditures as a percent of revenue were
unusually high due to large legal expenditures in 1999 relative
to litigation with minority shareholders of Microcell and
support relative to the sale of discontinued operations.
Additionally, the increased revenue from large, end-to-end
service contracts enabled general and administrative costs to
increase at a lower rate than revenue growth.

Tower Portfolio Sale and Administration. During
February 2000, the Company entered into an agreement for
the sale of up to 197 tower sites owned or to be constructed for
a total purchase price of up to $80.0 million when the
sites are conveyed. Through the end of September 2000, 177
tower sites were successfully conveyed resulting in a net gain
of $26.2 million. The Company believes substantially all of
the towers that will convey have been conveyed through
September 2000.

Depreciation and Amortization. Depreciation and
amortization expense was $2.2 million for the nine months
ended September 30, 2000 compared to $2.5 million for
the prior year. The decrease is a result of a reduction in
assets due to the Companys tower portfolio sale.

Interest Income/ Expense. Interest income, net of
interest expense, was $1.2 million for the nine months
ended September 30, 2000 compared to an expense of
$1.6 million for the prior year. The interest expense in
1999 was largely attributed to borrowings under the
Companys credit facility to finance the construction of
towers. The proceeds from the sale of the towers in 2000
provided sufficient proceeds to repay the Companys credit
facility and provide cash and cash equivalents that generated
interest income.

Other Expense. Other expense was $0.9 million for
the nine months ended September 30, 2000 compared to an
expense of $1.4 million for the prior year. The other
expense in the current year is attributable to losses using the
equity method of accounting for the Companys 19.9%
investment in Tecnosistemi of $0.8 million and to foreign
currency losses of $0.4 million, offset by a one-time gain
of $0.3 million. The loss in 1999 was largely driven by
foreign currency transaction losses of approximately
$1.4 million relative to the Companys Latin America
operations.

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##### Table of Contents



Provision (Benefit) for Income Taxes. The provision for
income taxes was $14.4 million for the nine months ended
September 30, 2000 compared to a benefit of
$2.7 million for the prior year. The provision for income
taxes was recorded for the nine months ended September 30,
2000 using an effective income tax rate of 44.0%. The effective
income tax rate in excess of the statutory rate reflects the
effect of non-deductible expenses resulting from the tower
portfolio sale. The benefit for income taxes was recorded in
1999 based on an effective income tax rate of 30.1%. The change
in effective income tax rates is due both to the impact of the
sale of the telecommunication tower portfolio and to the
conversion of the MCI note during the third quarter of 1999.

Net Income (Loss). Net income was $18.4 million for
the nine months ended September 30, 2000 compared to a loss
of $6.2 million for the prior year. The increase in net
income was due to income generated from the sale of the
telecommunications towers conveyed during the year and
additional gross profit generated by increased revenue.

Liquidity and Capital Resources

Cash and cash equivalents were $24.5 million at
September 30, 2000 compared to $2.0 million at
December 31, 1999, an increase of $22.5 million. Cash
combined with short-term investments at September 30, 2000
provides total liquid assets of $40.0 million. This
increase in liquidity stems from cash received from the tower
portfolio sale of $72.2 million. The tower proceeds were
largely used to acquire minority shareholder interests in the
tower subsidiary ($7.2 million), eliminate debt
($4.5 million), make strategic investments
($2.5 million) and fund operating activities
($19.4 million). Cash used in operating activities was
primarily related to receivable growth as a result of increased
revenue.

Working capital was $58.1 million at September 30,
2000 compared to $(8.0) million at December 31, 1999, an
increase of $66.1 million. The increase in working capital
was primarily due to the proceeds received-to-date from the sale
of the Companys telecommunication tower portfolio. The
Company believes it has sufficient working capital for the next
year.

15



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##### Table of Contents






PART II:  OTHER INFORMATION




Item 1:  Legal Proceedings

None

Item 2:  Changes in Securities

Not Applicable

Item 3:  Defaults Upon Senior Securities

Not Applicable

Item 4:  Submission of Matters to a Vote of
Security Holders

Not Applicable

Item 5:  Other Information

Not Applicable

Item 6:  Exhibits and Reports on Form 8-K



| |     |         
| | --- | --------
| | (a) | Exhibits

11  Computations of Earnings Per Common Share

27  Financial Data Schedule

(b)  Reports on Form 8-K

On July 31, 2000 the Company filed a Current Report on
Form 8-K/ A amending exhibit 2.1 of the original Report on
Form 8-K to include certain information previously omitted
pursuant to a request for confidential treatment. No other
information in the original Report on Form 8-K was amended
by this amendment.

On November 6, 2000 the Company filed a Current Report on
Form 8-K which reported that, on November 1, 2000, the
Company issued a press release announcing its third quarter
revenue and operating results.

16



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##### Table of Contents






Signature

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

|                        |  |                                                                                                          
|----------------------- |  | ---------------------------------------------------------------------------------------------------------
|                        |  | LCC International, Inc. and Subsidiaries                                                                 
|                       
|Date: November 13, 2000 |  | Signed: /s/ DAVID N. WALKERDavid N. Walker
	Senior Vice President, Treasurer
	and Chief Financial Officer

17