Net revenues for the second quarter ended March 31, 2001 totaled $35.2 million, a 60% increase compared with $22.0 million reported in the previous quarter ended December 31, 2000. EBITDA , excluding non-cash stock option compensation expense was ($13.6) million for the second quarter of fiscal 2001, compared with ($20.4) million for the previous quarter and ($11.6) million for the same period a year ago. For the three months ended March 31, 2001, the Company reported a net loss of ($28.4) million, or $2.18 per share, compared with a net loss of ($33.9) million in the previous quarter, or $2.64 per share, a sequential quarterly loss improvement of $5.5 million.

For the six months ended March 31, 2001, the Company reported net revenues of $57.2 million. EBITDA, excluding non-cash stock option compensation expense, was ($34.1) million for the first six months of fiscal 2001, compared with ($17.0) million for the same period a year ago. AirGate PCS reported a net loss of ($62.2) million, or $4.82 per share, in the six months ended March 31, 2001 compared with a net loss of $2.23 per share, in the same period of 2000.

The Company had $39.9 million in cash and cash equivalents at the end of the second fiscal quarter ended March 31, 2001, compared with $52.5 million at December 31, 2000. Working capital at the end of the second quarter of fiscal 2001 was $25.1 million. The Company believes that the proceeds of the concurrent equity and debt offerings completed in September 1999, together with the undrawn senior credit facility commitment led by Lehman Brothers of $98.0 million, will fund AirGate’s existing build-out plan as well as expected working capital requirements through 2002, at which point the Company expects to achieve break-even operating cash flow.

We are very pleased with the unprecedented progress we made this quarter as AirGate continued to build momentum in the marketplace, said Thomas M. Dougherty, president and chief executive officer of AirGate PCS. As a result of our outstanding execution, we again exceeded our operating targets. In addition to impressive subscriber growth, our performance reflects a strong sequential increase in service revenues, higher average revenue per user and declining customer churn, important indicators of our success in building a quality customer base.

We are excited about our prospects for the remainder of the year and see a significant opportunity for continued growth as we further penetrate the markets in our territory. AirGate has a distinct competitive advantage in offering the best clarity, coverage, connectivity and value for customers that is synonymous with the Sprint PCS brand name. Additionally, we benefit from the Sprint PCS national footprint and intend to leverage these advantages in the market as we continue to aggressively add more customers, added Dougherty.

Additional financial and operating highlights for the second quarter of fiscal 2001 include the following:

AirGate added 40,108 net new customers in its fifth quarter of commercial PCS operations. As a result, the Company had a total of 143,548 subscribers as of March 31, 2001.

Average revenue per subscriber (ARPU), excluding roaming, net of bad debt, was $58 for the quarter, compared with $54 for the previous quarter.

Total roaming revenue was $11.0 million for the second fiscal quarter of 2001, compared with $7.4 million for the previous quarter. Roaming expense was $7.4 million for the quarter, compared with $3.6 million for the previous quarter.

The Company opened two Sprint PCS stores in the second fiscal quarter (In addition, AirGate recently acquired certain operating assets to convert one of its resellers into Company-owned Sprint PCS retail outlets, providing an additional eight retail stores and two mall kiosks), bringing the total number of stores to thirty-three.

Churn, net of 30-day returns, was 2.6% compared with 2.9% in the prior quarter.

Capital expenditures were $12.1 million, reflecting additional cell site expenditures.

The Company also indicated that, based on current preliminary information and internal projections, it is providing guidance for the third fiscal quarter of 2001 ended June 30, 2001 as follows:

Net subscriber additions (net adds) are expected to be 27,000 to 30,000.

Roaming revenue is forecasted to be $11-$14 million. Conversely, roaming expense is expected to be $8 -$10 million.

ARPU is expected to be $57 to $59.

Churn, net of 30-day returns, is expected to be 2.5% – 2.7%.

Capital expenditures are expected to be approximately $12 million, primarily due to additional cell sites.

EBITDA losses, excluding non-cash stock option compensation expense, are expected to be $8 – $10 million.