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Technology Stocks : Orbital science (ORB)

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To: Fred Levine who wrote (2175)	7/26/1999 6:34:00 PM
From: Fred Levine	Read Replies (1) of 2394

Debt rating has been lowered... D&P lowers Orbital Sciences debt rating (Press release provided by Duff & Phelps Credit Rating Co.) Chicago (July 26, 1999)-- Duff & Phelps Credit Rating Co. (DCR) has lowered its implied senior unsecured debt rating of Orbital Sciences from BB+ (Double-B-Plus) to BB (Double-B). DCR has also placed the debt rating on Rating Watch--Down. Today's rating action reflects the build up in Orbital's debt in 1999 and disappointing earnings. Required investment in the ORBCOMM joint venture as well as investments in other joint ventures and acquisitions have required Orbital to draw down from its secured revolver in the first half of 1999. Additional debt or equity financing will be required in 1999. Financial results have also been disappointing, due principally to increased losses in satellite services. Orbital expects continued high losses from ORBCOMM for several quarters as the joint venture builds its subscriber base. ORBCOMM is a satellite-based, global, two-way data messaging, geographic tracking and data collection system. With 1998 sales of $734 million, Orbital is a leader in the rapidly growing market for low-cost space transportation systems, payloads and services. Acquisitions have enlarged and diversified the revenue base into related areas. Success in Orbitals ORBCOMM and ORBIMAGE investments would provide material improvement in profit and cash flow and reduce earnings variability through a monthly stream of service revenues. ORBIMAGE is a satellite-based system for collecting and distributing satellite imagery of the earths surface and atmospheric conditions. DCR will continue to evaluate the companys efforts to strengthen its capitalization in the near term. Orbital had total funded debt at March 31, 1999, of $251 million. fred

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