For the quarter, Globalstar L.P.'s net loss applicable to ordinary partnership interests declined to $129 million, a reduction of 30% from the previous quarter and the smallest loss recorded since the company initiated commercial operations in 2000.

Globalstar recorded a total of 6.8 million minutes of use (MOUs), including both mobile and fixed service, in the first quarter, representing a 3% decrease in traffic from the previous quarter. The estimated number of mobile and fixed subscribers at the end of March was 69,000, an increase of 5% over the previous quarter.

The rate of subscriber growth slowed from previous quarters, largely due to ongoing restructuring activities involving several of the company's service providers, where, in some cases, ownership changes disrupted business development efforts.

"The current restructuring process has temporarily diverted some of our resources from more productive sales and marketing activities," said Olof Lundberg, chairman and CEO of Globalstar. "Nevertheless, the quality of our service remains undiminished, and our customers continue to find utility and value in the products we offer.

"In the weeks ahead, we hope to complete a number of important steps, including acquisition of full ownership of Globalstar USA by Globalstar L.P. and the introduction of new sales programs, designed to make Globalstar service even more attractive to potential customers. In the meantime, our reduced expense structure gives us more time and flexibility in which to complete our business plan toward an orderly emergence from the restructuring process."

As previously announced, acquisition of full ownership of Globalstar USA by Globalstar L.P. is part of the company's overall strategy of consolidating operations in key markets to provide greater integration and control over sales and marketing activities.

Other steps in this strategy include acquiring a majority interest in Globalstar Canada, which was accomplished in late 2001, and acquiring full ownership in Globalstar Caribbean, which is expected to take place in the near future.

Financial Results

A full discussion of Globalstar's financial performance for the first quarter can be found in the company's Report on Form 10-Q, to be filed shortly with the U.S. Securities and Exchange Commission. Highlights are as follows:

Service revenues for the first quarter were $2.8 million, up 75% over the previous quarter. This was primarily due to the acquisition of a majority interest in Globalstar Canada in late 2001. The company also recorded an additional $1.1 million of equipment sales revenue from the sale of handsets and related equipment by the Canadian operation. Total revenues for the first quarter of 2002 were $3.9 million, a 144% increase over the fourth quarter of 2001.

As of March 31, 2002, Globalstar had approximately $46.4 million in cash on hand. The company has continued its cost-cutting measures, showing steady quarterly improvements in operating expenses over the past year. Exclusive of $11.0 million of non-cash bad debt expense related to service provider purchases of gateways, Globalstar had operating expenses for the quarter of $24 million, slightly more than half the level recorded for the same period in 2001.

Globalstar, L.P.'s $129 million loss for the quarter converts to a loss of $0.25 per share of Globalstar Telecommunications Ltd.

An update of Globalstar's operations was issued last month as part of the company's annual financial results announcement. Since that time, Globalstar engineers successfully restored two anomalous satellites -- one was returned to service, the other is now available as an in-orbit spare. As a result, the constellation now has 47 of 48 satellites in operation (with two spares), and service interruptions are extremely infrequent, occurring only at certain latitudes.

If the final remaining anomalous satellite fully recovers and returns to service, service interruptions will disappear altogether. Furthermore, Globalstar has implemented certain additional operational procedures, based on recent in-flight experience and investigation of the anomalies.

The company believes these procedures have helped accelerate recovery of anomalous satellites and will continue to do so in the future to further protect constellation availability.

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