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Pegasus continues to push forward with its Ka-Band project, but executives assured Wall Street that spending on the future satellite platform is restrained.

Pegasus CEO Mark Pagon described Ka-Band efforts from the company as modest. "We aren't spending much on capital outlay this year," he said of the Ka-Band endeavor.

It will be another three to four years before Pegasus' Ka-Band efforts get off the ground, Pagon said during a first quarter conference call with analysts. At the moment, the company is focused on the design and development of its Ka-Band authorizations. Pagon added that Pegasus will work hard to keep up with Federal Communications Commission milestones tied to its Ka-Band licenses.

On RadioShack, executives said Pegasus has signed up between 70 percent and 75 percent of independent franchises for the electronics retailer in its areas to sell its DirecTV service. Earlier this year, RadioShack suspended sales of DirecTV in areas served by Pegasus and the National Rural Telecommunications Cooperative.

As for the rest of 2002, Pagon said revenues are expected to be about $870 million to $890 million, EBITDA at between $200 and $220 million, and net subscriber additions showing a net increase of 1 percent to 3 percent on the company's installed base.

During the quarter, the company changed the method by which it reports subscribers. In the past, subscriber data included accounts in which service had been suspended for long periods of time. In order to improve reporting of its numbers, Pegasus said it has begun to exclude those accounts. The change resulted in a one-time reduction of 138,217 subscribers during the quarter.

As of the end of the first quarter, Pegasus had 1.379 million customers in its NRTC/DirecTV territories.

During the first quarter, Pegasus' consolidated net revenues grew to $224.2 million, from $213.8 million reported for the same period in 2001. Consolidated EBITDA grew to $41.6 million from a deficit of $2.5 million. The company's net loss applicable to common shares decreased to $39.7 million, or 67 cents per share, from $76.7 million, or $1.39 per share

From SkyReport (Used with Permission)
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