##### Table of Contents









United States Securities and Exchange
Commission

Washington, DC 20549




---

Form 10-Q/ A

(Amendment No. 1)


(Mark One)

|     |  |                                                                                                                                                         
|---- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------
|    
|    
|    
|    
|[X]  |  | Quarterly report pursuant to Section 13
	or 15(d) of the Securities
	Exchange Act of 1934
	For the quarterly period ended March 31, 2001                
|     |  | 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 May 7, 2001 the registrant had
outstanding 12,109,770 shares of Class A Common Stock, par
value $0.01 per share (the Class A Common
Stock) and 8,446,833 shares of Class B Common Stock,
par value $0.01 per share (the Class B Common
Stock).



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##### Table of Contents



EXPLANATORY NOTE

The Company is amending its Form 10-Q for
the fiscal year ending March 31, 2001, filed on
May 14, 2001, to add certain information required to be
included in Item 2 of Part I and on the signature page.

2



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TABLE OF CONTENTS



|                                                     |                                                                                               |  |  |  |  |  |  | 
|---------------------------------------------------- | --------------------------------------------------------------------------------------------- |  |  |  |  |  |  | 
|PART I: FINANCIAL INFORMATION                       
|                                                     | Item 1: Financial Statements                                                                 
|Condensed Consolidated Balance Sheets               
|Condensed Consolidated Statements of Cash Flows     
|Notes to Condensed Consolidated Financial Statements
|                                                     | Item 2: Managements Discussion and Analysis of Financial Condition and Results of Operations
|                                                     | Item 1: Legal Proceedings                                                                    
|                                                     | Item 2: Changes in Securities                                                                
|                                                     | Item 3: Defaults Upon Senior Securities                                                      
|                                                     | Item 4: Submission of Matters to a Vote of Security Holders                                  
|                                                     | Item 5: Other Information                                                                    
|                                                     | Item 6: Exhibits and Reports on Form 8-K                                                     
|                                                     | SIGNATURE                                                                                    
|Ex 11 Calculation of Net Income Per Share           



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##### Table of Contents



LCC International, Inc. and
Subsidiaries

Quarterly Report on Form 10-Q

For the quarter ended March 31,
2001


INDEX

|         |  |                                                                                                     |  |        |    | 
|-------- |  | --------------------------------------------------------------------------------------------------- |  | ------ | -- | 
|         |  |                                                                                                     |  | Page  
|         |  |                                                                                                     |  | Number
|         |  |                                                                                                     |  |       
|PART I:  |  | FINANCIAL INFORMATION                                                                               |  |        |    | 
|        
|        
|        
|        
|ITEM 1:  |  | FINANCIAL STATEMENTS                                                                                |  |        |    | 
|        
|        
|        
|        
|         |  | Condensed consolidated statements of operations
	for the three months ended March 31, 2000 and 2001 |  |        | 4  | 
|        
|        
|        
|        
|         |  | Condensed consolidated balance sheets as of
	December 31, 2000 and March 31, 2001                   |  |        | 5  | 
|        
|        
|        
|        
|         |  | Condensed consolidated statements of cash flows
	for the three months ended March 31, 2000 and 2001 |  |        | 6  | 
|        
|        
|        
|        
|         |  | Notes to condensed consolidated financial
	statements                                               |  |        | 7  | 
|        
|        
|        
|        
|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 | 

3



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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
|                                                                      |                                                          | March 31,         
|                                                                      |                                                          |                   
|                                                                      |                                                          | 2000               |         | 2001   
|                                                                      |                                                          |                    |         |        
|REVENUES:                                                             |                                                          |                    |         |         |   |   |        |       
|                                                                     
|                                                                     
|                                                                     
|                                                                     
|                                                                      | Service                                                  |                    | $       | 29,297  |   |   | $      | 42,655 |  
|                                                                     
|                                                                     
|                                                                     
|                                                                     
|                                                                      | Tower ownership and management                           |                    |         | 849     |   |   |        |       |  
|                                                                      |                                                          |                    |         |         |   |   |        |       
|                                                                      |                                                          |                    | 30,146  |         |   |   | 42,655 |       
|                                                                      |                                                          |                    |         |         |   |   |        |       
|COST OF REVENUES:                                                     |                                                          |                    |         |         |   |   |        |       
|                                                                     
|                                                                     
|                                                                     
|                                                                     
|                                                                      | Service                                                  |                    |         | 21,721  |   |   |        | 32,747 |  
|                                                                     
|                                                                     
|                                                                     
|                                                                     
|                                                                      | Tower ownership and management                           |                    |         | 262     |   |   |        |       |  
|                                                                      |                                                          |                    |         |         |   |   |        |       
|                                                                      |                                                          |                    | 21,983  |         |   |   | 32,747 |       
|                                                                      |                                                          |                    |         |         |   |   |        |       
|GROSS PROFIT                                                          |                                                          |                    | 8,163   |         |   |   | 9,908  |       
|                                                                      |                                                          |                    |         |         |   |   |        |       
|OPERATING (INCOME) EXPENSE:                                           |                                                          |                    |         |         |   |   |        |       
|                                                                     
|                                                                     
|                                                                     
|                                                                     
|                                                                      | Sales and marketing                                      |                    |         | 1,873   |   |   |        | 2,006  |  
|                                                                     
|                                                                     
|                                                                     
|                                                                     
|                                                                      | General and administrative                               |                    |         | 4,046   |   |   |        | 4,187  |  
|                                                                     
|                                                                     
|                                                                     
|                                                                     
|                                                                      | Gain on sale of tower portfolio and
	administration, net |                    |         | (21,218 | ) |   |        | (1,605 | )
|                                                                     
|                                                                     
|                                                                     
|                                                                     
|                                                                      | Depreciation and amortization                            |                    |         | 952     |   |   |        | 720    |  
|                                                                      |                                                          |                    |         |         |   |   |        |       
|                                                                      |                                                          |                    | (14,347 | )       |   |   | 5,308  |       
|                                                                      |                                                          |                    |         |         |   |   |        |       
|OPERATING INCOME                                                      |                                                          |                    | 22,510  |         |   |   | 4,600  |       
|                                                                      |                                                          |                    |         |         |   |   |        |       
|OTHER INCOME (EXPENSE):                                               |                                                          |                    |         |         |   |   |        |       
|                                                                     
|                                                                     
|                                                                     
|                                                                     
|                                                                      | Interest income                                          |                    |         | 230     |   |   |        | 589    |  
|                                                                     
|                                                                     
|                                                                     
|                                                                     
|                                                                      | Interest expense                                         |                    |         | (228    | ) |   |        |       |  
|                                                                     
|                                                                     
|                                                                     
|                                                                     
|                                                                      | Other                                                    |                    |         | (394    | ) |   |        | (49    | )
|                                                                      |                                                          |                    |         |         |   |   |        |       
|                                                                      |                                                          |                    | (392    | )       |   |   | 540    |       
|                                                                      |                                                          |                    |         |         |   |   |        |       
|INCOME FROM OPERATIONS BEFORE INCOME TAXES                            |                                                          |                    | 22,118  |         |   |   | 5,140  |       
|                                                                     
|                                                                     
|                                                                     
|                                                                     
|PROVISION FOR INCOME TAXES                                            |                                                          |                    | 9,290   |         |   |   | 2,056  |       
|                                                                      |                                                          |                    |         |         |   |   |        |       
|NET INCOME                                                            |                                                          | $                  | 12,828  |         |   | $ | 3,084  |       
|                                                                      |                                                          |                    |         |         |   |   |        |       
|NET INCOME PER SHARE:                                                 |                                                          |                    |         |         |   |   |        |       
|                                                                     
|                                                                     
|                                                                     
|                                                                     
|                                                                      | Basic                                                    |                    | $       | 0.64    |   |   | $      | 0.15   |  
|                                                                      |                                                          |                    |         |         |   |   |        |       
|                                                                      | Diluted                                                  |                    | $       | 0.57    |   |   | $      | 0.15   |  
|                                                                      |                                                          |                    |         |         |   |   |        |       
|WEIGHTED AVERAGE SHARES USED IN CALCULATION OF
	NET INCOME PER SHARE: |                                                          |                    |         |         |   |   |        |       
|                                                                     
|                                                                     
|                                                                     
|                                                                     
|                                                                      | Basic                                                    |                    |         | 20,160  |   |   |        | 20,494 |  
|                                                                      |                                                          |                    |         |         |   |   |        |       
|                                                                      | Diluted                                                  |                    |         | 22,604  |   |   |        | 21,189 |  
|                                                                      |                                                          |                    |         |         |   |   |        |       

See accompanying notes to condensed consolidated
financial statements.

4



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##### Table of Contents



LCC International, Inc. and
Subsidiaries






Condensed Consolidated Balance
Sheets


(In thousands)


|                                                                                 |                                                                                                                                   |                                         |         |             |        |   |         |        |        | 
|-------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------- | ------- | ----------- | ------ | - | ------- | ------ | ------ | 
|                                                                                 |                                                                                                                                   | December 31,                            |         | March 31,  
|                                                                                 |                                                                                                                                   | 2000                                    |         | 2001       
|                                                                                 |                                                                                                                                   |                                         |         |            
|                                                                                 |                                                                                                                                   |                                         |         | (Unaudited)
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|ASSETS:                                                                          |                                                                                                                                   |                                         |         |             |        |   |         |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Current assets:                                                                  |                                                                                                                                   |                                         |         |             |        |   |         |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | Cash and cash equivalents                                                                                                         |                                         | $       | 22,271      |        |   | $       | 18,863 |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | Short-term investments                                                                                                            |                                         |         | 20,064      |        |   |         | 19,986 |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | Receivables, net of allowance for doubtful
	accounts of $1,829 and $1,942 at December 31, 2000 and
	March 31, 2001, respectively: |                                         |         |             |        |   |         |        |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 |                                                                                                                                   | Trade accounts receivable               |         |             | 31,306 |   |         |        | 29,869 | 
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 |                                                                                                                                   | Due from related parties and affiliates |         |             | 746    |   |         |        | 634    | 
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 |                                                                                                                                   | Unbilled receivables                    |         |             | 17,050 |   |         |        | 20,479 | 
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | Deferred income taxes, net                                                                                                        |                                         |         | 1,850       |        |   |         | 2,513  |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | Prepaid expenses and other current assets                                                                                         |                                         |         | 1,858       |        |   |         | 1,771  |       
|                                                                                 |                                                                                                                                   |                                         |         |             |        |   |         |       
|                                                                                 |                                                                                                                                   | Total current assets                    |         |             | 95,145 |   |         |        | 94,115 | 
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Property and equipment, net                                                      |                                                                                                                                   |                                         | 5,638   |             |        |   | 5,886   |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Investments                                                                      |                                                                                                                                   |                                         | 3,650   |             |        |   | 5,369   |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Deferred income taxes, net                                                       |                                                                                                                                   |                                         | 5,066   |             |        |   | 3,428   |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Other assets                                                                     |                                                                                                                                   |                                         | 546     |             |        |   | 514     |       
|                                                                                 |                                                                                                                                   |                                         |         |             |        |   |         |       
|                                                                                 |                                                                                                                                   | $                                       | 110,045 |             |        | $ | 109,312 |       
|                                                                                 |                                                                                                                                   |                                         |         |             |        |   |         |       
|LIABILITIES AND SHAREHOLDERS
	EQUITY:                                           |                                                                                                                                   |                                         |         |             |        |   |         |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Current liabilities:                                                             |                                                                                                                                   |                                         |         |             |        |   |         |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | Accounts payable                                                                                                                  |                                         | $       | 5,926       |        |   | $       | 6,946  |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | Accrued expenses                                                                                                                  |                                         |         | 10,465      |        |   |         | 9,634  |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | Accrued employee compensation and benefits                                                                                        |                                         |         | 12,420      |        |   |         | 10,742 |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | Deferred revenue                                                                                                                  |                                         |         | 332         |        |   |         | 150    |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | Income taxes payable                                                                                                              |                                         |         | 5,725       |        |   |         | 5,828  |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | Other current liabilities                                                                                                         |                                         |         | 817         |        |   |         | 1,573  |       
|                                                                                 |                                                                                                                                   |                                         |         |             |        |   |         |       
|                                                                                 |                                                                                                                                   | Total current liabilities               |         |             | 35,685 |   |         |        | 34,873 | 
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Other liabilities                                                                |                                                                                                                                   |                                         | 5,944   |             |        |   | 3,020   |       
|                                                                                 |                                                                                                                                   |                                         |         |             |        |   |         |       
|                                                                                 |                                                                                                                                   | Total liabilities                       |         |             | 41,629 |   |         |        | 37,893 | 
|                                                                                 |                                                                                                                                   |                                         |         |             |        |   |         |       
|Preferred stock:                                                                 |                                                                                                                                   |                                         |         |             |        |   |         |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | 10,000 shares authorized; 0 shares issued and
	outstanding                                                                        |                                         |         |            |        |   |         |       |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Class A common stock, $0.01 par value:                                           |                                                                                                                                   |                                         |         |             |        |   |         |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | 70,000 shares authorized; 12,040 and 12,088
	shares issued and outstanding at December 31, 2000 and
	March 30, 2001, respectively |                                         |         | 120         |        |   |         | 121    |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Class B common stock, $0.01 par value:                                           |                                                                                                                                   |                                         |         |             |        |   |         |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|                                                                                 | 20,000 shares authorized; 8,450 and 8,447 shares
	issued and outstanding at December 31, 2000 and
	March 31, 2001, respectively   |                                         |         | 85          |        |   |         | 85     |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Paid-in capital                                                                  |                                                                                                                                   |                                         | 91,407  |             |        |   | 91,745  |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Accumulated deficit                                                              |                                                                                                                                   |                                         | (18,381 | )           |        |   | (15,297 | )     
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Notes receivable from shareholders                                               |                                                                                                                                   |                                         | (2,325  | )           |        |   | (2,325  | )     
|                                                                                 |                                                                                                                                   |                                         |         |             |        |   |         |       
|                                                                                 | Subtotal                                                                                                                          |                                         |         | 70,906      |        |   |         | 74,329 |       
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Accumulated other comprehensive loss 
	foreign currency translation adjustments |                                                                                                                                   |                                         | (2,490  | )           |        |   | (2,910  | )     
|                                                                                 |                                                                                                                                   |                                         |         |             |        |   |         |       
|                                                                                 |                                                                                                                                   | Total shareholders equity              |         |             | 68,416 |   |         |        | 71,419 | 
|                                                                                 |                                                                                                                                   |                                         |         |             |        |   |         |       
|                                                                                 |                                                                                                                                   | $                                       | 110,045 |             |        | $ | 109,312 |       
|                                                                                 |                                                                                                                                   |                                         |         |             |        |   |         |       

See accompanying notes to condensed consolidated
financial statements.

5



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##### Table of Contents



LCC International, Inc. and
Subsidiaries






Condensed Consolidated Statements of Cash
Flows


(In thousands)


(Unaudited)


|                                                      |                                                                                |                                              |                                          |         |         |         |        |        |        |        |  
|----------------------------------------------------- | ------------------------------------------------------------------------------ | -------------------------------------------- | ---------------------------------------- | ------- | ------- | ------- | ------ | ------ | ------ | ------ | -
|                                                      |                                                                                |                                             
|                                                      |                                                                                | Three Months Ended                          
|                                                      |                                                                                | March 31,                                   
|                                                      |                                                                                |                                             
|                                                      |                                                                                | 2000                                         |                                          | 2001   
|                                                      |                                                                                |                                              |                                          |        
|Cash flows from operating activities:                 |                                                                                |                                              |                                          |         |         |         |        |       
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      | Net income                                                                     |                                              | $                                        | 12,828  |         |         | $      | 3,084  |       
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      | Adjustments to reconcile net income to net cash
	used in operating activities: |                                              |                                          |         |         |         |        |        |       
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      |                                                                                | Depreciation and amortization                |                                          |         | 952     |         |        |        | 720    |       
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      |                                                                                | Provision for doubtful accounts              |                                          |         |        |         |        |        | 262    |       
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      |                                                                                | Gain on sale of tower portfolio              |                                          |         | (21,218 | )       |        |        | (1,605 | )     
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      |                                                                                | Changes in operating assets and liabilities: |                                          |         |         |         |        |        |        |       
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      |                                                                                |                                              | Trade, unbilled, and other receivables   |         |         | (11,745 | )      |        |        | (2,138 | )
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      |                                                                                |                                              | Accounts payable and accrued expenses    |         |         | (4,737  | )      |        |        | (1,489 | )
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      |                                                                                |                                              | Other current assets and liabilities     |         |         | 240     |        |        |        | 791    |  
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      |                                                                                |                                              | Other non-current assets and liabilities |         |         | (8,744  | )      |        |        | (586   | )
|                                                      |                                                                                |                                              |                                          |         |         |         |        |       
|Net cash used in operating activities                 |                                                                                |                                              | (14,936                                  | )       |         |         | (961   | )     
|                                                      |                                                                                |                                              |                                          |         |         |         |        |       
|Cash flows from investing activities:                 |                                                                                |                                              |                                          |         |         |         |        |       
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      | (Purchases) sales of short term investments                                    |                                              |                                          | (13,557 | )       |         |        | 78     |       
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      | Purchases of property and equipment                                            |                                              |                                          | (1,326  | )       |         |        | (1,087 | )     
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      | Investments                                                                    |                                              |                                          |        |         |         |        | (1,732 | )     
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      | Proceeds from tower portfolio sale, net                                        |                                              |                                          | 57,655  |         |         |        |       |       
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      | Redemption of minority shareholders                                            |                                              |                                          | (7,174  | )       |         |        |       |       
|                                                      |                                                                                |                                              |                                          |         |         |         |        |       
|Net cash provided by (used in) investing
	activities  |                                                                                |                                              | 35,598                                   |         |         |         | (2,741 | )     
|                                                      |                                                                                |                                              |                                          |         |         |         |        |       
|Cash flows from financing activities:                 |                                                                                |                                              |                                          |         |         |         |        |       
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      | Proceeds from issuance of common stock, net                                    |                                              |                                          | 112     |         |         |        | 162    |       
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      | Proceeds from exercise of options                                              |                                              |                                          | 1,176   |         |         |        | 132    |       
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      | Proceeds from line of credit                                                   |                                              |                                          | 9,700   |         |         |        |       |       
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      | Payments on line of credit                                                     |                                              |                                          | (14,235 | )       |         |        |       |       
|                                                      |                                                                                |                                              |                                          |         |         |         |        |       
|Net cash provided by (used in) financing
	activities  |                                                                                |                                              | (3,247                                   | )       |         |         | 294    |       
|                                                      |                                                                                |                                              |                                          |         |         |         |        |       
|Net increase (decrease) in cash and cash
	equivalents |                                                                                |                                              | 17,415                                   |         |         |         | (3,408 | )     
|                                                     
|                                                     
|                                                     
|                                                     
|Cash and cash equivalents at beginning of period      |                                                                                |                                              | 1,951                                    |         |         |         | 22,271 |       
|                                                      |                                                                                |                                              |                                          |         |         |         |        |       
|Cash and cash equivalents at end of period            |                                                                                | $                                            | 19,366                                   |         |         | $       | 18,863 |       
|                                                      |                                                                                |                                              |                                          |         |         |         |        |       
|Supplemental disclosures of cash flow information:    |                                                                                |                                              |                                          |         |         |         |        |       
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      | Cash paid during the quarter for:                                              |                                              |                                          |         |         |         |        |        |       
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      |                                                                                | Interest                                     |                                          | $       | 196     |         |        | $      |       |       
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      |                                                                                | Income taxes                                 |                                          |         | 413     |         |        |        | 851    |       

See accompanying notes to condensed consolidated
financial statements.

6



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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
(referred to herein as the Company) provide
end-to-end solutions for wireless voice and data communications
networks with offerings ranging from high level technical
consulting, system design and deployment and ongoing management
and optimization services.

The Company operates in a highly competitive
environment subject to rapid technological change and emergence
of new technologies. Historically, the key drivers of growth in
the Companys wireless service business have been
(1) the issuance of new or additional licenses to wireless
operators; (2) the introduction of new services or
technologies; (3) increases in the number of subscribers
served by wireless operators; and (4) the increasing
complexity of wireless systems in operation. 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 the Company 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 consolidated financial statements
prepared in accordance with accounting principles generally
accepted in the United States of America 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, 2000.
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

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 accounting
principles generally accepted in the United States of America
are included in comprehensive income, but excluded from net
income. Other comprehensive income consists solely of foreign
currency translation adjustments at March 31, 2000 and
2001. Comprehensive income, for the three months ended
March 31 is as follows (in thousands).

|                                                             |  |      |        |      |  |   |       |  
|------------------------------------------------------------ |  | ---- | ------ | ---- |  | - | ----- | -
|                                                             |  | 2000 |        | 2001
|                                                             |  |      |        |     
|Net income                                                   |  | $    | 12,828 |      |  | $ | 3,084 |  
|                                                             |  |      |        |      |  |   |       |  
|Other comprehensive loss, before tax                         |  |      | (199   | )    |  |   | (700  | )
|                                                            
|                                                            
|                                                            
|                                                            
|Income tax benefit related to items of
	comprehensive income |  |      | (75    | )    |  |   | (280  | )
|                                                             |  |      |        |      |  |   |       |  
|Other comprehensive loss, net of tax                         |  |      | (124   | )    |  |   | (420  | )
|                                                             |  |      |        |      |  |   |       |  
|Comprehensive income                                         |  | $    | 12,704 |      |  | $ | 2,664 |  
|                                                             |  |      |        |      |  |   |       |  

7



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##### Table of Contents



Note 4:  Investments

In February 2001, the Company invested an
additional $1.7 million to maintain its 15.0% interest in
Plan + Design Netcare AG (PDN). 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 December 31, 2000, 177 tower sites were
conveyed to Pinnacle for net proceeds of $72.2 million.
While some portion of the remaining towers may convey in the
future, 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 had deferred $5.2 million of the
gain as of December 31, 2000 which relates to the remaining
lease obligations under the Master Antenna Site Lease. The
Company recognized $1.6 million of the gain during the
quarter ended March 2001 due to the subleasing of a portion
of the unoccupied space on some of the telecommunication towers.
The remaining $3.6 million is included in current and other
long-term liabilities as of March 31, 2001.

During 2000, 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 improvement 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
$10 million for project management and audit services; it
also provides for approximately $1.0 million per year for
maintenance services based on the current number of sites as to
which Microcell has been engaged. In each case, the pricing and
scope of services are subject to annual review and
re-negotiation on or around June 1 of each year.

Note 6:  Contingencies

The Company is party to various non-material
legal proceedings and claims incidental to its business.
Management does not believe that these maters will have a
material adverse affect on the consolidated results of
operations or financial condition of the Company.

Note 7:  Segment
Information

The Companys operating segments include
Services (Design Services and Deployment Services) and Tower
ownership and management. Design Services provides engineering
and design services for cellular phone system operators,
personal communication system (PCS) operators and
other wireless communication system providers. Deployment
Services provides program and construction management services
related to the build-out of wireless communication systems.

8



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##### Table of Contents



Segment detail is summarized as follows (in
thousands):

|                                   |                                     |               |       |                 |        |         |        |     |       |   |        |        |        | 
|---------------------------------- | ----------------------------------- | ------------- | ----- | --------------- | ------ | ------- | ------ | --- | ----- | - | ------ | ------ | ------ | 
|                                   |                                     |               |       | Tower Ownership |        | Segment
|                                   |                                     | Services      |       | and Management  |        | Total  
|                                   |                                     |               |       |                 |        |        
|Three Months Ended March 31,
	2000 |                                     |               |       |                 |        |         |        |     |       |   |        |       
|Revenues                           |                                     |               |       |                 |        |         |        |     |       |   |        |       
|                                  
|                                  
|                                  
|                                  
|                                   | Net revenue from external customers |               | $     | 29,297          |        |         | $      | 849 |       |   | $      | 30,146 |       
|                                  
|                                  
|                                  
|                                  
|                                   | Inter-segment revenue               |               |       |                |        |         |        |    |       |   |        |       |       
|                                   |                                     |               |       |                 |        |         |        |     |       |   |        |       
|                                   |                                     | Total revenue |       | $               | 29,297 |         |        | $   | 849   |   |        | $      | 30,146 | 
|                                   |                                     |               |       |                 |        |         |        |     |       |   |        |       
|Net income                         |                                     | $             | 2,571 |                 |        | $       | 20,923 |     |       | $ | 23,494 |       
|                                   |                                     |               |       |                 |        |         |        |     |       |   |        |       
|                                   |                                     | Total assets  |       | $               | 86,178 |         |        | $   | 8,191 |   |        | $      | 94,369 | 
|                                   |                                     |               |       |                 |        |         |        |     |       |   |        |       

|                                   |                                     |               |       |                 |         |         |     |   |       |   |       |        |         | 
|---------------------------------- | ----------------------------------- | ------------- | ----- | --------------- | ------- | ------- | --- | - | ----- | - | ----- | ------ | ------- | 
|                                   |                                     |               |       | Tower Ownership |         | Segment
|                                   |                                     | Services      |       | and Management  |         | Total  
|                                   |                                     |               |       |                 |         |        
|Three Months Ended March 31,
	2001 |                                     |               |       |                 |         |         |     |   |       |   |       |       
|Revenues                           |                                     |               |       |                 |         |         |     |   |       |   |       |       
|                                  
|                                  
|                                  
|                                  
|                                   | Net revenue from external customers |               | $     | 42,655          |         |         | $   |  |       |   | $     | 42,655 |        
|                                  
|                                  
|                                  
|                                  
|                                   | Inter-segment revenue               |               |       |                |         |         |     |  |       |   |       |       |        
|                                   |                                     |               |       |                 |         |         |     |   |       |   |       |       
|                                   |                                     | Total revenue |       | $               | 42,655  |         |     | $ |      |   |       | $      | 42,655  | 
|                                   |                                     |               |       |                 |         |         |     |   |       |   |       |       
|Net income                         |                                     | $             | 3,580 |                 |         | $       | 923 |   |       | $ | 4,503 |       
|                                   |                                     |               |       |                 |         |         |     |   |       |   |       |       
|                                   |                                     | Total assets  |       | $               | 107,586 |         |     | $ | 1,726 |   |       | $      | 109,312 | 
|                                   |                                     |               |       |                 |         |         |     |   |       |   |       |       

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

|     |            |         |   |              |  |              |   |                    |   |  |   |     |  |  |   |        | 
|---- | ---------- | ------- | - | ------------ |  | ------------ | - | ------------------ | - |  | - | --- |  |  | - | ------ | 
|     |            |         |   | Unallocated  |  |              |   |                   
|     |            | Segment |   | Corporate    |  |              |   |                   
|     |            | Total   |   | Expenditures |  | Eliminations |   | Consolidated Total
|     |            |         |   |              |  |              |   |                   
|2000 |            |         |   |              |  |              |   |                    |   |  |   |     |  |  |   |       
|    
|    
|    
|    
|     | Net income |         | $ | 23,494       |  |              | $ | (10,666            | ) |  | $ |    |  |  | $ | 12,828 | 
|     |            |         |   |              |  |              |   |                    |   |  |   |     |  |  |   |       
|2001 |            |         |   |              |  |              |   |                    |   |  |   |     |  |  |   |       
|    
|    
|    
|    
|     | Net income |         | $ | 4,503        |  |              | $ | (1,694             | ) |  | $ | 275 |  |  | $ | 3,084  | 
|     |            |         |   |              |  |              |   |                    |   |  |   |     |  |  |   |       

Note 8:  Recovery of
Receivables

On March 28, 2001, the United States
Bankruptcy Court, District of Maryland, Northern Division,
entered an order confirming the Amended Joint Plan of
Reorganization Under Chapter 11 (the Plan) for
DCR PCS, Inc. (DCR) and Pocket Communications, Inc.
(Pocket). The Plan provides that the Companys
claim against DCR will be allowed in the amount of
$5.0 million. The Company received payment of
$5.0 million on April 11, 2001 which will be
recognized during the quarter ended June 30, 2001. The Plan
also provides that LCCs general unsecured claim against
Pocket will be allowed in the amount filed minus
$5.0 million, or approximately $12.4 million, which is
to be paid at the same percentage recovery received by the
Pocket general unsecured creditors as a class (excluding certain
creditors which also hold secured claims under the Plan and who
have agreed to forgo recovery on the first $5.8 million in
available funds) after the resolution of certain remaining
disputed claims and the calculation of administrative fees and
expenses of the estate. Based on the estimates of the Official
Committee of Unsecured Creditors, there is a potential of
recovery on the Pocket general unsecured claims of 10% to 16% of
the allowed amount. Any additional amounts recovered will be
recognized if and when received.

During 1997, the Company recorded a charge for
receivables due from a Malaysian corporation. On March 15,
2001, the Company received payment of $2.1 million, net of taxes
withheld at the source of $0.4 million, as complete
settlement on these balances after the Malaysian corporation
successfully emerged from bankruptcy. This amount has been
recognized as a recovery of bad debt during the quarter ended
March 31, 2001 and was recorded as a reduction in general
and administrative expense.

9



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##### Table of Contents






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

LCC International, Inc. and
Subsidiaries

For the Three Months Ended March 31, 2000
and 2001

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 includes, without limitation,
forward-looking statements regarding the Companys ability
to pursue and secure new business opportunities, its tower
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, 2000.

Overview

The Company provides integrated end-to-end
solutions for wireless voice and data communications networks
with offerings ranging from high level technical consulting,
system design and deployment and ongoing management and
optimization services. Since its inception in 1983, the Company
has delivered wireless network solutions to more than 200
customers in over 50 countries.

In the last two years, the Company has made
several strategic decisions that have enable it to return to its
core competency in providing end-to-end wireless services. In
October 1999, the company disposed of its software product
business and, in March 2000, the Company sold its
telecommunication tower business. In addition, during the last
two years, the Company has entered into a number of joint
ventures and strategic investments to enhance its wireless
capabilities with a particular focus on certain international
markets.

The Company operates in a highly competitive
environment subject to rapid technological change and emergence
of new technologies. Historically, the key drivers of growth in
the companys wireless services business have been
(1) the issuance of new or additional licenses to wireless
operators; (2) the introduction of new services or
technologies; (3) increases in the number of subscribers
served by wireless operators; and (4) the increasing
complexity of wireless systems in operation.

The Companys principal sources of revenues
are design services and system deployment services. The Company
provides 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 offers its deployment services on a
fixed-price, time-certain basis. Revenues are recognized for
such contracts using the percentage-of-completion method. Under
the percentage-of-completion method, expenses on each project
are recognized as incurred, and revenues are recognized based on
the ratio of the current costs incurred for the project to the
then estimated total costs of the project. Accordingly, revenue
recognized in a given period depends on, among other things, the
costs incurred on each individual project and the current
estimate of the total costs to complete a project. If cost
estimates increase, gross profit for any single project may be
significantly reduced or eliminated. If the total contract cost
estimates indicate that there is a loss, such loss is recognized
in the period such determination is made.

Cost of revenues consists of costs associated
with engineering design and program management services. 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.

10



---



##### 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              
|                                           |                                              | March 31,                       
|                                           |                                              |                                 
|                                           |                                              | 2000                             |      | 2001 
|                                           |                                              |                                  |      |      
|Revenues:                                  |                                              |                                  |      |       |       |   |      |      
|                                          
|                                          
|                                          
|                                          
|                                           | Service                                      |                                  |      | 97.2  | %     |   |      | 100.0 | %    
|                                          
|                                          
|                                          
|                                          
|                                           | Tower ownership and management               |                                  |      | 2.8   |       |   |      |      |      
|                                           |                                              |                                  |      |       |       |   |      |      
|                                           |                                              | Total revenues                   |      |       | 100.0 |   |      |       | 100.0 | 
|                                           |                                              |                                  |      |       |       |   |      |      
|Cost of revenues:                          |                                              |                                  |      |       |       |   |      |      
|                                          
|                                          
|                                          
|                                          
|                                           | Service                                      |                                  |      | 72.0  |       |   |      | 76.8  |      
|                                          
|                                          
|                                          
|                                          
|                                           | Tower ownership and management               |                                  |      | 0.9   |       |   |      |      |      
|                                           |                                              |                                  |      |       |       |   |      |      
|                                           |                                              | Total cost of revenues           |      |       | 72.9  |   |      |       | 76.8  | 
|                                           |                                              |                                  |      |       |       |   |      |      
|Gross profit:                              |                                              |                                  |      |       |       |   |      |      
|                                          
|                                          
|                                          
|                                          
|                                           | Service                                      |                                  |      | 25.1  |       |   |      | 23.2  |      
|                                          
|                                          
|                                          
|                                          
|                                           | Tower ownership and management               |                                  |      | 2.0   |       |   |      |      |      
|                                           |                                              |                                  |      |       |       |   |      |      
|                                           |                                              | Total gross profit               |      |       | 27.1  |   |      |       | 23.2  | 
|                                           |                                              |                                  |      |       |       |   |      |      
|Operating (income) expense:                |                                              |                                  |      |       |       |   |      |      
|                                          
|                                          
|                                          
|                                          
|                                           | Sales and marketing                          |                                  |      | 6.2   |       |   |      | 4.7   |      
|                                          
|                                          
|                                          
|                                          
|                                           | General and administrative                   |                                  |      | 13.4  |       |   |      | 9.8   |      
|                                          
|                                          
|                                          
|                                          
|                                           | Tower portfolio sale and administration, net |                                  |      | (70.4 | )     |   |      | (3.8  | )    
|                                          
|                                          
|                                          
|                                          
|                                           | Depreciation and amortization                |                                  |      | 3.2   |       |   |      | 1.7   |      
|                                           |                                              |                                  |      |       |       |   |      |      
|                                           |                                              | Total operating (income) expense |      |       | (47.6 | ) |      |       | 12.4  | 
|                                           |                                              |                                  |      |       |       |   |      |      
|Operating income                           |                                              |                                  | 74.7 |       |       |   | 10.8 |      
|                                           |                                              |                                  |      |       |       |   |      |      
|Other income (expense):                    |                                              |                                  |      |       |       |   |      |      
|                                          
|                                          
|                                          
|                                          
|                                           | Interest income                              |                                  |      | 0.8   |       |   |      | 1.3   |      
|                                          
|                                          
|                                          
|                                          
|                                           | Interest expense                             |                                  |      | (0.8  | )     |   |      |      |      
|                                          
|                                          
|                                          
|                                          
|                                           | Other                                        |                                  |      | (1.3  | )     |   |      | (0.1  | )    
|                                           |                                              |                                  |      |       |       |   |      |      
|                                           |                                              | Total other income (expense)     |      |       | (1.3  | ) |      |       | 1.2   | 
|                                           |                                              |                                  |      |       |       |   |      |      
|Income from operations before income taxes |                                              |                                  | 73.4 |       |       |   | 12.0 |      
|                                          
|                                          
|                                          
|                                          
|Provision for income taxes                 |                                              |                                  | 30.8 |       |       |   | 4.8  |      
|                                           |                                              |                                  |      |       |       |   |      |      
|Net income                                 |                                              |                                  | 42.6 | %     |       |   | 7.2  | %    
|                                           |                                              |                                  |      |       |       |   |      |      

11



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##### Table of Contents



Three Months Ended March 31,
2000

Compared to


Three Months Ended March 31,
2001


Revenues.Revenues
for the three months ended March 31, 2001 were
$42.7 million compared to $30.2 million for the prior
year, an increase of $12.5 million or 41%. Increased
revenue in North America services of $13.8 million was the
largest contributor to the growth, with the XM Satellite
contract providing 72% of the North American increase. The North
American growth was offset by a reduction of $0.9 million
in tower ownership revenue as a result of the tower portfolio
sale in the prior year.

Cost of Revenues.Cost of revenues for the three months ended March 31, 2001
were $32.8 million compared to $22.0 million for the
prior year, an increase of $10.8 million or 49%. As a
percentage of total revenues, cost of revenues was 76.8% and
72.9% for 2001 and 2000, respectively. Cost of revenues was
higher as a percent of revenue in 2001 because of costs
associated with lower utilization of professional staff,
resulting from the reduction or postponement of certain projects.

Gross Profit.Gross
profit for the three months ended March 31, 2001 was
$9.9 million compared to $8.2 million for the prior
year, an increase of $1.7 million or 21%. The gross profit
increase is largely attributable to the increase in revenues. As
a percentage of total revenues, gross profit from services was
23.2% and 25.2% for 2001 and 2000. The decline in gross profit
margin in 2001 is largely attributable to lower utilization of
professional staff, resulting from the reduction or postponement
of certain projects as discussed above.

Sales and Marketing.Sales and marketing expenses were $2.0 million for the
three months ended March 31, 2001 compared to
$1.9 million for the prior year, an increase of
$0.1 million. As a percentage of total revenues, sales and
marketing was 4.7% and 6.2% for 2001 and 2000, 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 $4.2 million for the three months
ended March 31, 2001 compared to $4.1 million for the
prior year. General and administrative expenditures in 2001
included the recovery of $2.5 million related to a
Malaysian clients account receivable balance that the
Company expensed in 1997. Excluding all charges and recoveries
of doubtful accounts, general and administrative expenses were
$6.4 million and $4.6 million or 15.0% and 15.3%,
respectively, of 2001 and 2000 revenues.

Gain on Sale of Tower Portfolio and
Administration, net.During February
2000, the Company entered into an agreement for the sale of
tower sites owned or to be constructed for a total purchase
price of up to $80.0 million when the sites are conveyed.
As part of the sale agreement the Company agreed to lease
unoccupied space on the towers, effectively guaranteeing a
minimum rent level of $5.2 million on the towers sold. The
gain from the tower portfolio sale deferred an amount
corresponding to this rent commitment, until the space was
leased to another tenant. In the current quarter, the Company
recognized $1.6 million of this previously deferred gain
due to the subleasing of a portion of the unoccupied space to
other tenants.

Depreciation and
Amortization.Depreciation and
amortization expense was $0.7 million for the three months
ended March 31, 2001 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 was
$0.6 million for the three months ended March 31,
2001. The proceeds from the sale of the towers in 2000 provided
sufficient proceeds to repay the Companys credit facility
and provide cash balances that generated interest income.

Other Expense.Other
expense was $0.05 million for the three months ended
March 31, 2001 compared to $0.4 million for the prior
year, a decrease of $0.35 million. The decrease is largely
attributable to the Company discontinuing the application of the
equity method of accounting for the Companys investment in
Tecnosistemi during the third quarter of 2000.

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Provision for Income
Taxes.The provision for income taxes
was recorded for the three months ended March 31, 2001
using an effective income tax rate of 40.0% compared to 42.0%
for the comparable period in 2000. The higher tax rate in 2000
reflects non-recurring, permanent differences relative to the
tower portfolio sale.

Net Income.Net
income was $3.1 million for the three months ended March
31, 2001 compared to $12.8 million in the prior year. Net
income was increased by the gain on the sale of the tower
portfolio in both years. In addition, 2001 earnings reflect a
$2.5 million recovery related to a Malaysian clients
account receivable balance that the Company took a charge for in
1997.

Liquidity and Capital Resources

Cash combined with short-term investments at
March 31, 2001 provides total liquid assets of
$38.8 million compared to $42.3 million at
December 31, 2000.

Cash used in operations was $1.0 million for
the three months ended March 31, 2001, compared to cash used of
$14.9 million in the prior year. The cash used from
operating activities in 2000 was driven by trade receivable
increases relative to the December 31, 1999 balances, which
reflected an extremely advantageous payment term on a large
contract in that year.

Cash used by investing activities totaled
$2.7 million for the three months ended March 31,
2001, related to investments of $1.7 million, and purchases
of property and equipment of $1.1 million. Investing
activities for the three months ended March 31, 2000
provided $35.6 million. Cash provided from investing
activities in 2000 was driven by tower portfolio sale proceeds
of $57.7 million. Offsetting the tower portfolio proceeds
in 2000 was the use of cash to purchase minority shareholder
interests for $7.2 million, short-term investments of
$13.6 million, and purchases of property and equipment of
$1.3 million.

Cash from financing activities provided
$0.3 million and used $3.2 million for the three
months ended March 31, 2001 and 2000, respectively. The
largest source of financing activities in 2000 was from the
Companys line of credit until the credit line was repaid
with the tower portfolio sale proceeds during the same year. The
Companys strong cash position negated the need for any
significant financing activity during the three months ended
March 31, 2001.

Working capital was $59.2 million at
March 31, 2001 compared to $59.5 million at
December 31, 2000. The Companys primary requirement
for working capital is to fund receivables relative to services
performed. The Company has no material cash commitments other
than obligations under its operating leases. Future capital
requirements will depend upon many factors, including the timing
of payments under contracts and increases in personnel in
advance of new contracts.

The Company had no debt and did not maintain a
line of credit as of March 31, 2001, since it had cash and
short-term investments that it considered sufficient to meet
liquidity requirements. The Company believes it has sufficient
assets and relationships with financial institutions to obtain a
loan commitment should the business need arise.

For the short-term the Company believes it will
generate sufficient cash flow from operations and has adequate
cash reserves to satisfy cash requirements for the next twelve
months. The Company also believes it will generate sufficient
cash from operations to meet its long-term liquidity needs.

Quantitative and Qualitative Disclosures about
Market Risk

The Company is exposed to the impact of foreign
currency fluctuations. The Companys exposure to exchange
rates relates primarily to its foreign subsidiaries.
Subsidiaries with material foreign currency exposure are in the
United Kingdom, Brazil, Egypt, and Colombia. For its foreign
subsidiaries, exchange rates impact the U.S. dollar value of
their reported earnings and the intercompany transactions with
the subsidiaries.

Approximately 23% of the Companys revenues
are generated outside the United States for the three months
ended March 31, 2001, the majority of which are in Europe.
As a result, fluctuations in the value of

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foreign currencies against the U.S. dollar may
have a significant impact on the reported results of the
Company. Revenues and expenses denominated in foreign currencies
are translated into United States dollars monthly at the
weighted average exchange rate. Consequently, as the value of
the dollar strengthens relative to other currencies in the
Companys major markets the resulting translated revenues,
expenses and operating profits are lower.


Fluctuations in currency exchange rates also
impact the U.S. dollar amount of Shareholders equity of
the Company. The assets and liabilities of the Companys
non-U.S. subsidiaries are translated into United States dollars
both at the exchange rate in effect at March 31, 2001 as
well as historical rates. The resulting translation adjustments
are recorded in Shareholders equity as Accumulated other
comprehensive loss. The dollar was stronger relative to many of
the foreign currencies at March 31, 2001 compared to
December 31, 2000. Consequently, the Accumulated other
comprehensive loss component of Shareholders equity
increased $0.4 million during the three months ended
March 31, 2001. As of March 31, 2001, the total amount
of long-term intercompany receivable/ payables in non-U.S.
subsidiaries subject to this equity adjustment, using the
exchange rate as of the same date, was approximately
$6.9 million.

The Company is exposed to the impact of foreign
currency fluctuations due to the operations of and short-term
intercompany transactions with its consolidated foreign
subsidiaries. While these intercompany balances are eliminated
in consolidation, exchange rate changes do affect consolidated
earnings. Foreign subsidiaries with amounts owed to U.S.
operations (denominated in U.S. dollars) are the United Kingdom,
Colombia and Brazil at March 31, 2001 in the amount of
$0.6 million, $0.5 million and $0.3 million,
respectively. The potential foreign currency translation losses
from a hypothetical 10% adverse change relative to these
intercompany balances would be $0.1 million. In addition, a
hypothetical 10% adverse change would result in a
$0.1 million decline relative to operating profits
generated outside the United States for the three months ended
March 31, 2001. This was estimated using a 10%
deterioration factor to the average monthly exchange rates
applied to net income or loss for each of the subsidiaries in
the respective period. Foreign exchange gains and losses
recognized on any transactions are included in the Consolidated
Statements of Operations.

Although currency fluctuations impact the
Companys reported results and Shareholders equity,
such fluctuations generally do not affect the Companys
cash flow or result in actual economic gains or losses. The
Company currently does not hedge any of these risks in its
foreign subsidiaries because: (i) the Companys
Brazilian and Egyptian subsidiaries derive revenues and incur
expenses within a single country and consequently, do not incur
currency risks in connection with the conduct of their normal
operations, (ii) the British pound sterling, U.S. dollar,
and Euro is relatively stable against each other,
(iii) other foreign operations are minimal, and
(iv) the Company does not believe that to do so is
justified by the current exposure and cost at this time.

Trends That May Affect Results of Operations
and Financial Condition

In recent months, the Company has seen a
tightening of the capital markets, and specifically a slowdown
in wireless telecommunications infrastructure spending. The
Companys success depends upon continued growth in the
deployment and optimization of wireless networks. Many wireless
customers are reliant upon the capital markets to obtain funds
to finance building and improving their wireless networks. Most
vulnerable are customers that are new licensees and
operators/carriers who have limited sources of funds from
operations. Revenue from broadband customers only constituted
4.7% of revenue for the three months ended March 31, 2001
and is not expected to be a significant source of revenue in
2001. In Europe deploying 3G networks, which only
constituted 2.0% of revenues for the three months ended
March 31, 2001, is expected to provide substantial growth
in the future for the Company. However, the availability of
equipment for the European 3G markets and other capital market
driven slowdowns may shift 2001 revenues into 2002 and 2003.
Additionally, various established U.S. carriers may delay system
upgrades due to a variety of factors including technology
issues, equipment availability, and capital spending reductions.

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PART II:  OTHER
INFORMATION




Item 1:  Legal
Proceedings

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




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  Calculation of Net Income Per Share

(b) Reports on Form 8-K

On May 1, 2001, the Company filed a Current
Report on Form 8-K, which reported that on May 1,
2001, the Company issued a press release announcing its first
quarter revenues and operating results.

On February 5, 2001, the Company filed a
Current Report on Form 8-K, which reported that on
February 5, 2001, the Company issued a press release
announcing its fourth quarter and year end revenues and
operating results.

On January 16, 2001, the Company filed a
Current Report on Form 8-K, which reported that on
January 16, 2001, the Company issued a press release
announcing certain modifications to the terms of a contract,
dated August 18, 1999, with XM Satellite Radio Inc.
(XM) for the design and deployment of XMs
terrestrial repeater network.

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SIGNATURE

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



| |                                         
| | ----------------------------------------
| | LCC International, Inc. and Subsidiaries



| |         |                    
| | ------- | -------------------
| | Signed: | /s/ DAVID N. WALKER

| |                                  
| | ---------------------------------
| |                                  
| | David N. Walker                  
| | Senior Vice President, Treasurer 
| | and Chief Financial Officer      
| | (Principal Accounting Officer and
| | Chief Financial Officer)         

Date: December 20, 2001


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