As filed with the Securities and Exchange Commission on June 30, 2003
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                 --------------

                                    FORM 20-F
|_|               REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g)
                  OF THE SECURITIES EXCHANGE ACT OF 1934
                                       OR
|X|               ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
                  OF THE SECURITIES EXCHANGE ACT OF 1934

                  For the fiscal year ended: December 31, 2002
                                       OR
|_|               TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                  OF THE SECURITIES EXCHANGE ACT OF 1934
                            For the transition period from N/A to N/A
Commission file number: 1-15130

                            New Skies Satellites N.V.
             (Exact name of Registrant as specified in its charter)

                            New Skies Satellites N.V.
                 (Translation of Registrant's name into English)

                                 The Netherlands
                 (Jurisdiction of incorporation or organization)

                              Rooseveltplantsoen 4
                       2517 KR The Hague, The Netherlands
                    (Address of principal executive offices)


Securities registered or to be registered pursuant to Section 12(b) of the Act.

Title of each class                    Name of each exchange on which registered
-------------------                    -----------------------------------------
Ordinary Shares, nominal value         New York Stock Exchange
(euro)0.05 per share                   Euronext Amsterdam N.V.

Securities registered or to be registered pursuant to Section 12(g) of the Act.

                                      None

Securities for which there is a reporting obligation pursuant to Section 15(d)
of the Act.

                                      None

Indicate the number of outstanding shares of each of the issuer's classes of
capital or common stock as of the close of the period covered by the annual
report:

Ordinary Shares, nominal value (euro)0.05 per share 125,376,211

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 |_|

Indicate by check mark which financial statement item the registrant has elected
to follow. Item 17 |_| Item 18 |X|


<PAGE>





                                       ii

Forward looking statements


PART I

Item 1.  IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS.................2

Item 2.  OFFER STATISTICS AND EXPECTED TIMETABLE...............................2

Item 3.  KEY INFORMATION.......................................................2

Item 4.  INFORMATION ON THE COMPANY...........................................13

Item 5.  OPERATING AND FINANCIAL REVIEW AND PROSPECTS.........................29

Item 6.  DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES...........................41

Item 7.  MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS....................51

Item 8.  FINANCIAL INFORMATION................................................54

Item 9.  THE OFFER AND LISTING................................................54

Item 10.  ADDITIONAL INFORMATION..............................................55

Item 11  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK...........60

Item 12.  DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES..............60

PART II

Item 13.  DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES.....................60

Item 14.  MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS
          AND USE OF PROCEEDS.................................................61

Item 15.  DISCLOSURE CONTROLS AND PROCEDURES..................................61

item 16.  [RESERVED]..........................................................61

PART III

Item 17.  FINANCIAL STATEMENTS................................................61

Item 18.  FINANCIAL STATEMENTS................................................61

Item 19.  EXHIBITS............................................................61

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS...................................F-1





<PAGE>


In this document, the "Company," "New Skies," "we," "us," and "our" refer to New
Skies Satellites N.V.

                           FORWARD-LOOKING STATEMENTS

    Certain statements in this annual report are not historical facts and are
"forward-looking statements" within the meaning of U.S. federal securities laws.
We intend that those statements be covered by the safe harbors created under
those laws. Words such as "believes", "expects", "estimates", "may", "intends",
"will", "should" or "anticipates" and similar expressions or their negatives
identify forward-looking statements.

    Forward-looking statements, such as the statements regarding our ability to
develop and expand our business, our ability to manage costs, our ability to
exploit and respond to technological innovation, the effects of laws and
regulations (including tax laws and regulations) and legal and regulatory
changes, the opportunities for strategic business combinations and the effects
of consolidation in our industry on us and our competitors, our anticipated
future revenues, our anticipated capital spending (including for future
satellite procurements), our anticipated financial resources, our expectations
about the future operational performance of our satellites (including their
projected operational lives), the expected strength of and growth prospects for
our existing customers and the markets that we serve, and other statements
contained in this annual report regarding matters that are not historical facts,
involve predictions. Statements of that sort involve known and unknown risks,
uncertainties and other factors that may cause our actual results, performance
or achievements or industry results to be materially different from any future
results, performance or achievements expressed or implied by any statements of
that sort. These risks and uncertainties include:

     o    problems with respect to the construction, launch or in-orbit
          performance of our existing and future satellites;

     o    increased competition;

     o    decreased demand, either for our services or for the products and
          services provided by our customers to third parties;

     o    changing technology;

     o    changes in our business strategy or development plans;

     o    our ability to attract and retain qualified personnel;

     o    our ability to attract sufficient funding to meet our future capital
          requirements;

     o    worldwide economic and business conditions; and

     o    legal and regulatory developments.

Certain of these factors are discussed in more detail elsewhere in this annual
report including, without limitation, in Item 3 "Risk Factors", Item 4
"Information on the Company" and Item 5 "Operating and Financial Review and
Prospects". These risks could cause actual results to vary materially from
future results indicated, expressed or implied in any forward-looking
statements.

Many of these factors are beyond our ability to control or predict. Given these
uncertainties, readers are cautioned not to place undue reliance on
forward-looking statements.

Neither our independent auditors nor any other independent accountants have
compiled, examined or performed any procedures with respect to the prospective
financial information contained herein, nor have they expressed any opinion or
any other form of assurance on such information or its achievability, and assume
no responsibility for, and disclaim any association with, the prospective
financial information.



<PAGE>

ITEM 1.  IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS

         Not applicable.

ITEM 2.  OFFER STATISTICS AND EXPECTED TIMETABLE

         Not applicable.

ITEM 3.  KEY INFORMATION

OVERVIEW

    We are a satellite communications company with global operations and service
coverage. We have been an independent commercial satellite operator since 1998.
We currently operate a network of six satellites located at five different fixed
orbital positions above the earth, together with a ground-based network for
controlling our satellites and providing commercial traffic over them. Our
customers can access one or more of our satellites from almost any point around
the world. We have one additional satellite under construction, which is planned
for launch in fourth quarter 2004. During 2002, the transponder availability
rate for our satellites was 99.998 percent.

    Our customers include established "blue chip" telecommunications carriers,
leading broadcasting and video companies, governmental entities, and
fast-growing smaller companies from around the globe. They use our services for
video contribution and distribution, corporate data networks, voice
transmissions, and Internet applications. We believe that the combination of our
global satellite fleet and our expanding customer base, well diversified in
terms of both geography and service applications, provides us with a solid
foundation from which we can execute our long-term business plan.


SELECTED CONSOLIDATED HISTORICAL FINANCIAL DATA

     The following tables set out our selected consolidated historical financial
data as of and for the years ended December 31, 2002, 2001, 2000, 1999 and 1998.
We have extracted part of the selected consolidated historical financial data as
of December 31, 2002 and 2001 and for the years ended December 31, 2002, 2001
and 2000 from the consolidated historical financial statements included
elsewhere in this annual report. We have extracted part of the selected
consolidated historical financial data as of December 31, 2000, 1999 and 1998
and for the years ended December 31, 1999 and 1998 from the consolidated
historical financial statements previously filed with the U.S. Securities and
Exchange Commission. Our financial statements as of and for the years ended
December 31, 2002, 2001, 2000, 1999 and 1998 have been audited by Deloitte &
Touche Accountants, independent auditors.

    We acquired our initial assets as a spin-off from our predecessor on
November 30, 1998. Our 1999 financial statements reflect our first full year of
independent operations. The information included in our financial statements up
to November 30, 1998 was derived from the historical financial statements of our
predecessor using allocation assumptions. Revenues were allocated on the basis
of the actual historical revenues generated by the satellites transferred to us.
Expenses were allocated on various bases. We believe these allocations were
reasonable and consistently applied.

    Nonetheless, our financial statements for 1998 do not necessarily reflect
actual costs that we would have incurred or revenues that we would have earned
if we had operated as an independent, stand-alone commercial business during
that period. In particular, after our spin-off in November 1998, we incurred a
number of costs associated with being a stand-alone commercial entity that
either were not incurred or were incurred at substantially lower levels when our
predecessor controlled our assets, including the cost of in-orbit insurance,
which we incurred for the first time in November 1998; costs associated with
establishing commercially oriented marketing operations; and costs associated
with sub-contracting our tracking, telemetry and control and payload management
operations, which we now perform ourselves for all but one of our satellites.

    You should read the selected consolidated historical financial data together
with Item 5 "Operating and Financial Review and Prospects" and our consolidated
financial statements and the accompanying notes included elsewhere in this
annual report.

<PAGE>

<TABLE>

                                                                          Year Ended December 31,
                                                      -----------------------------------------------------------------
                                                          2002          2001         2000(1)       1999          1998
                                                      -----------------------------------------------------------------
                                                        (in millions, except for per ordinary share and margin data)
Statement of operations data:
<S>      <C>                                         <C>           <C>          <C>           <C>         <C>
Revenues (2)...................................      $   200.5     $   209.0    $   198.3     $   135.5    $    116.7
Operating expenses:
  Cost of operations (3).......................           50.7          51.5         47.0          30.9          20.7
  Selling, general and administrative (3)......           39.5          38.7         34.8          20.7          11.2
  Organization costs...........................             -             -            -             -            2.9
  Depreciation and amortization................           80.6          75.4         69.9          71.9          71.5
  Termination of the KTV satellite
    contract (4)...............................             -             -         -              15.5            -
                                                      ------------ ------------ ------------- ----------- -------------
Total operating expenses.......................          170.8         165.6        151.7         139.0         106.3
                                                      ------------ ------------ ------------- ----------- -------------

Operating income (loss)........................           29.7          43.4         46.6          (3.5)         10.4
Interest expense (income), net.................            0.5          (9.0)        (2.6)         (0.1)          1.8
                                                      ------------ ------------ ------------- ----------- -------------
Income (loss) before income tax
  (benefit) expense............................           29.2          52.4         49.2          (3.4)          8.6
Income tax (benefit) expense...................           10.5          19.3         17.5          (1.2)         (1.0)
                                                      ------------ ------------ ------------- ----------- -------------
Income (loss) before cumulative effect of change
  in accounting principle.......................          18.7          33.1         31.7          (2.2)          9.6
Cumulative effect of change in accounting
  principle, relating to goodwill, net of taxes (5)      (23.3)           -            -             -             -
                                                      ------------ ------------ ------------- ----------- -------------

Net income (loss) .............................       $   (4.6)     $   33.1    $    31.7     $    (2.2)  $       9.6
                                                      ============ ============ ============= =========== =============

Basic and diluted earnings per share (6) :
Income before cumulative effect of change
  in accounting principle.....................        $    0.14      $   0.25    $    0.29    $    (0.02)  $      0.10

Cumulative effect of change in
  accounting principle........................            (0.18)          -            -             -             -
                                                      ------------ ------------ ------------- ----------- -------------
Basic and diluted earnings per share...........       $   (0.04)    $    0.25    $    0.29    $    (0.02) $       0.10
                                                      ============ ============ ============= =========== =============

Statement of cash flow data:
Net cash provided by operating
  Activities...................................       $  112.0      $  130.7   $   117.9      $    60.2   $      83.2
Net cash used in investing activities
  (or capital expenditures)....................         (231.4)       (222.7)      (148.9)        (73.1)       (117.1)
Net cash (used) provided by financing
  activities...................................          (10.6)         (2.5)      230.5            0.1          80.6

Other financial data (unaudited):
EBITDA (adjusted) (7)..........................       $  110.3      $  118.8    $   116.5     $    83.9   $      81.9
EBITDA (adjusted) margin (8)...................            55%           57%         59%            62%           70%


                                                                           As of December 31,
                                                     ----------------------------------------------------------------
                                                          2002          2001         2000          1999          1998
                                                     ----------------------------------------------------------------
                                                                             (in millions)

Balance sheet data:
Total current assets (4).......................        $  58.3       $ 189.4      $ 287.3       $  85.5       $  65.6
Communications, plant and other property (4)...        1,058.1         886.2        685.4         631.5         749.6
Total assets...................................        1,127.8       1,109.8      1,064.6         782.3         830.7
Total liabilities (4)..........................          108.8          72.6         59.0          63.1         111.5
Total shareholders' equity.....................        1,019.0       1,037.2      1,005.6         719.2         719.2

</TABLE>
----------

(1)  Includes results of operations for New Skies Networks Pty Ltd. for the
     nine-month period from March 31, 2000 (the date of acquisition) to December
     31, 2000.

(2)  Includes a one-time contract termination payment received in 2000 that
     resulted in a net positive impact of $19.7 million.

(3)  After we began independent operations, we incurred additional operating
     costs, including the cost of in-orbit insurance, which we incurred for the
     first time in November 1998; costs associated with establishing
     commercially oriented marketing operations; and costs associated with
     tracking, telemetry and control and payload management operations. Those
     costs either were not included in any of the historical allocations of our
     predecessor's results in 1998 or were included at lower levels.

(4)  In 1999, we terminated a contract for the construction of the KTV satellite
     due to the manufacturer's failure to deliver the satellite by the
     contractual deadline. Due to the termination of the KTV satellite
     construction contract, we originally:

          o    reduced communications, plant and other property by $84.1
               million;

          o    recorded a receivable from the satellite manufacturer of $51.5
               million;

          o    eliminated a $17.1 million liability to the manufacturer of the
               KTV satellite; and

          o    wrote off $15.5 million of previously capitalized interest and
               program management costs.

     The effect of this write-off was to turn net income of $7.9 million to a
     net loss of $2.2 million in 1999. In 2001, the Company received a
     reimbursement of payments previously made for the construction and program
     management of the satellite totaling $53.3 million. The award included the
     reimbursement of $1.8 million of previously expensed KTV project management
     costs.

(5)  As of January 1, 2002, we adopted Statement of Financial Accounting
     Standard No. 142, Goodwill and Other Intangible Assets. This Standard
     eliminates goodwill amortization from the Consolidated Statement of
     Operations and requires an evaluation of goodwill for impairment upon
     adoption of this Standard, as well as subsequent evaluations on an annual
     basis, and more frequently if circumstances indicate a possible impairment.
     Upon adoption of SFAS No. 142, we performed a transitional impairment test
     on the goodwill resulting from the purchase of New Skies Networks Pty
     Limited in March 2000. As a result of this impairment test, we recorded an
     impairment charge of approximately $23 million, which is classified as a
     cumulative effect of a change in accounting principle.

(6)  Basic earnings per ordinary share for the years ending December 31, 2002,
     2001, 2000, and 1999 is calculated by dividing the net income (loss) for
     that period by the weighted average number of ordinary shares outstanding
     for the respective period, which equaled 130.3 million, 130.6 million,
     107.4 million and 100.0 million shares for 2002, 2001, 2000 and 1999,
     respectively. We have computed earnings per ordinary share for the year
     ended December 31, 1998 on a pro forma basis assuming approximately 100.0
     million shares had been outstanding for that year.

     Diluted earnings per share for the year ended December 31, 2001 takes into
     consideration the dilutive effect of stock options for approximately
     141,000 ordinary shares, out of a total of 4,904,302 shares under options
     outstanding at the end of the period. The difference in the weighted
     average number of shares outstanding for 2001 resulted in no differences
     between basic and diluted earnings per share. Diluted earnings per share
     for the year ended December 31, 2000 takes into consideration the dilutive
     effect of stock options for approximately 691,000 ordinary shares, out of a
     total of 3,541,040 shares under options outstanding at the end of the
     period. The difference in the weighted average number of shares outstanding
     for 2000 resulted in no differences between basic and diluted earnings per
     share. In 2002 and 1999 we excluded a number of ordinary shares from this
     calculation that are not outstanding but relate to outstanding stock
     options that have not been exercised. To include these shares in the
     calculation would be antidilutive, because we had a net loss in those
     years.

     The share data for 1998 and 1999 has been adjusted to reflect a 10-to-1
     share split effected on August 24, 2000.

(7)  "EBITDA (adjusted)" as used in this annual report consists of operating
     income before depreciation and amortization, termination of the KTV
     satellite contract and cumulative effect of change in accounting principle
     due to goodwill. We believe EBITDA (adjusted) is an appropriate measure of
     our performance because the annual charge for depreciation, along with the
     1999 charge for the termination of the KTV satellite contract and the
     cumulative effect of change in accounting principle relating to goodwill
     recorded in 2002, comprise a disproportionate share of our expenses. This
     information comes from our historical financial statements. We believe that
     earnings before interest, taxes, depreciation and amortization (EBITDA) is
     a measure of performance used by some investors, equity analysts and others
     to make informed investment decisions. EBITDA is not presented as an
     alternative measure of operating results or cash flow from operations, as
     determined in accordance with generally accepted accounting principles in
     the U.S. EBITDA as presented herein may not be comparable to similarly
     titled measures reported by other companies. See Item 5 "Operating and
     Financial Review and Prospects -- Table 2 `- Reconciliation of EBITDA
     (adjusted) to net (loss) income'".

(8)  EBITDA (adjusted) margin represents EBITDA (adjusted) as a percentage of
     revenues.

<PAGE>

                            EXCHANGE RATE INFORMATION

     On January 1, 1999, the Euro was introduced as a new currency in The
Netherlands and ten other European Union member states. The exchange rate at
which the Dutch guilder has been irrevocably fixed against the Euro is NLG
2.20371 = (euro)1.00.

    Before January 1, 1999, there was no fixed exchange rate between the Euro
and the U.S. dollar. The following table describes, for the periods and dates
indicated, information concerning the noon buying rate for the Euro in New York
City for cable transfers as certified for customs purposes by the Federal
Reserve Bank of New York. Amounts are expressed in U.S. dollars per (euro)1.00,
and average figures reflect the average of the noon buying rates on the last day
of each month during the relevant period.

<TABLE>
<CAPTION>

                                     Rate at
Year Ended                          period end       Average          High            Low

<S>                                   <C>            <C>            <C>               <C>
December 31, 1999...............      1.0070         1.0653         1.1812            1.0016
December 31, 2000...............      0.9388         0.9232         1.0335            0.8270
December 31, 2001...............      0.8901         0.8909         0.9535            0.8370
December 31, 2002...............      1.0485         0.9454         1.0485            0.8594

Month Ended

October 31, 2002..............................................      0.9881            0.9708
November 30, 2002.............................................      1.0139            0.9895
December 31, 2002.............................................      1.0485            0.9927
January 31, 2003..............................................      1.0861            1.0361
February 28, 2003.............................................      1.0875            1.0708
March 31, 2003................................................      1.1062            1.0545
April 30, 2003................................................      1.1180            1.0621
May 31, 2003..................................................      1.1853            1.1200
</TABLE>

The noon buying rate for the Euro on June 25, 2003 was (euro)1.00 = $1.1592.



<PAGE>


                                  RISK FACTORS

 Risks Relating to Our Business

A significant launch delay or launch failure could affect our ability to satisfy
demand for our services, to generate future revenues and, in certain cases, to
maintain our legal rights to use the orbital location from which the satellite
was to operate.

    At this time, we have plans to launch one new satellite (NSS-8) in the
fourth quarter of 2004. NSS-8 will be used to replace our existing NSS-703
satellite. NSS-703, which has an anticipated commercial life ending in 2009,
will then be relocated to a different orbital location. Based on a variety of
considerations, we may choose to launch additional new and replacement
satellites in future years.

    The launch of any future spacecraft may not take place as scheduled. Delays
in launching satellites are quite common and can result from construction
delays, the unavailability of the launch vehicle when construction has been
completed, and other factors. We also may experience delays in achieving
operational service after launch. If we were to experience a material delay in
launching and placing into service a replacement satellite, the delay could
adversely affect our ability to continue providing services to existing
customers and, thereby, adversely affect our future revenues. More generally, a
material delay could defer our ability to generate future revenues. In addition,
because our rights to use our authorized orbital locations expire if we do not
place a satellite into operation within a specified period of time, a
significant launch delay could cause us to lose our rights to make use of the
orbital location intended for that satellite.

    Satellites are subject to launch failure. The overall historical loss rate
for all launches of commercial satellites in fixed orbits is estimated to be
approximately 10 percent, but may be higher. Launch failure rates vary according
to the launch vehicle used. We expect to use a 6,000 kg payload variant of the
Sea Launch Zenit-3SL vehicle to launch NSS-8.

    In the event of a launch failure, we likely would face a significant delay
in constructing and launching a replacement satellite. Typically, the
construction and launch of a satellite takes at least two, and sometimes more
than three, years to complete. A launch failure for a replacement satellite
could affect our ability to continue providing service to existing customers
and, thereby, adversely affect our revenues. More generally, a launch failure
could adversely affect our ability to expand our available capacity. Although we
would endeavor to accommodate customers on one of our other satellites or,
potentially, by using capacity leased from a third party, a launch failure could
adversely affect our ability to generate future revenues. In addition, in
certain cases, a launch failure could cause us to lose our rights to make use of
the orbital location intended for that satellite.

We may experience satellite equipment failures that impair the commercial
performance of our satellites, which could lead to lost revenues.

    During and after their launch, satellites are subject to in-orbit equipment
failures, including for example circuit failures, transponder failures, solar
array failures, battery cell failures, satellite control system failures, and
propulsion system failures. These failures can degrade commercial performance,
reduce transmission capacity, shorten the commercial lives of satellites, or
otherwise limit their revenue generating ability.

    We anticipate that NSS-5, NSS-6, NSS-7, NSS-703, and NSS-806 will have
commercial lives in excess of 12 years from their respective launch dates, but
we cannot assure you that this will be the case. A number of factors will affect
the anticipated commercial lives of our satellites, including:

     o    the amount of propellant used in maintaining orbital position or
          relocating to a new orbital position;

     o    the durability and quality of their construction;

     o    the performance of their components; and

     o    operational considerations, including operational failures.

    To date, we have not experienced any catastrophic in-orbit failures. Certain
of our satellites, however, have experienced component failures. There is a
possibility that one or more transponders or other key components on any of our
existing or future satellites may cease to work in accordance with design
specifications during the satellite's anticipated commercial life. While, in
many cases, back-up components or reconfigurations allow for the continued
operation of an affected transponder or component, it is possible that
individual transponders or components may become inoperable. We cannot assure
you that normal operations could be restored through redundant transponders or
other redundant components on the satellite or that failed components could be
replaced with other components. Where service cannot be restored, the failure
would cause the satellite to suffer performance degradation or to cease
operating prematurely, either in whole or in part.

     Our satellites may suffer from other problems, such as a loss of
propellant, greater than anticipated use of propellant during launch, or
malfunctions that could reduce their maneuver or commercial lives. Acts of war,
magnetic, electrostatic or solar storms, space debris or micrometeoroids could
also damage our satellites.

    Any full or partial failure of one of our satellites could cause our
revenues to decline and adversely affect our ability to generate future
revenues. In addition, a failure could cause us to have to expedite our planned
replacement program and thereby affect our financing needs and our ability to
use available funds for other purposes.

We may experience a failure of our satellite or ground operations infrastructure
that impairs the commercial performance of our satellites or the services
delivered over our satellites, which could lead to lost revenues.

    We operate a primary Satellite Operations Center (SOC) at our headquarters
in The Hague. In addition, we maintain a remote, fully functional, routinely
tested back-up facility for our SOC in Redu, Belgium. Signals from our SOC are
transmitted to our satellites through our own teleport facilities and through
teleports owned by third parties. We may experience a failure in necessary
equipment in our SOC, in our back-up facility, or in the communication links
between these facilities and remote teleport facilities. A failure affecting our
tracking, telemetry and control operations might cause us to be unable to
communicate with our satellites or to transmit an incorrect instruction to the
satellites. This could lead to a degradation in satellite performance or to the
loss of one or more of our satellites, and could adversely affect our future
revenues.

    We also provide communications services through our own teleport facilities
and through teleports owned by third parties. We may experience a failure in
necessary equipment in one of our teleports or in a third-party teleport. A
failure of necessary ground-based communications equipment could lead to a loss
of revenues from customers who were not provided with the proper transmission
services, which could adversely affect our revenues.

Insurance expenses may increase, or insurance may become unavailable.

    We insure our satellites both during launch and during their in-orbit
operational lives. Launch insurance currently costs approximately 15 percent to
25 percent of the insured amount, but may vary depending on market conditions,
the safety record of the launch vehicle and the performance record of similar
satellites built by the same manufacturer. In-orbit insurance generally costs
between 1 percent and 3 percent of the net book value of the insured satellite
each year.

    Insurance costs have increased substantially in recent years and could
increase further for any number of reasons. In particular, the cost of launch
insurance could increase significantly based on one or more launch failures
involving launch vehicles used by us, launch vehicles similar to those to be
used by us, or launch vehicles in general. The cost of in-orbit insurance may
increase based on the failure or degradation of one of our in-orbit satellites,
the failure of another satellite of a similar series owned by another operator,
or satellite failures in general.

    If rates were to rise substantially, our operating costs would increase. In
addition, we might conclude that it does not make business sense to obtain
third-party insurance. It is also possible that insurance could become
unavailable, either generally or for a specific launch vehicle, satellite
series, or a particular satellite, or that new insurance could be subject to
broader exclusions on coverage.

Our insurance for satellite operation and for future satellite launches will not
protect us against all satellite-related losses.

    In the event of a total or partial failure of a satellite, our in-orbit
insurance will reimburse us for the proportion of the net book value of the
satellite lost as a result of the failure, unless the cause of the failure is
subject to a policy exclusion. The insurance will not protect us, however,
against business interruption, lost revenues or delay of revenues.

    We plan to obtain insurance for the launch of any future satellite.
Typically, launch insurance covers the replacement cost of the satellite, the
launch, and the insurance, but does not protect us against business
interruption, lost revenues, delay of revenues or other issues arising from the
launch failure or other operational problems covered by the launch insurance
policy.

    Both launch and in-orbit insurance policies include, or can be expected to
include, specified exclusions, deductibles and material change limitations that
are customary in the industry at the time the policy is written.

The loss of customers, particularly our large customers, may reduce our future
revenues.

    The top ten purchasers of our services accounted for, in the aggregate,
approximately 48 percent of our revenues in 2002, 42 percent of our revenues in
2001, and 47 percent of our revenues in 2000. If we fail to maintain our
relationships with our major customers, if we fail to replace them, if we lose
them or if there is reduced demand from them, it could result in a significant
loss of revenues.

    More generally, our customers may fail to renew or may cancel their
contracts with us, which could negatively affect future revenues.

The loss of key employees could impede our ability to implement our business
plan.

    We rely on a number of key employees. Many of these key employees have been
recruited away from their home countries to work in the Netherlands or in our
other international offices and may intend to return to their home countries in
the future. Our key employees have highly specialized skills and extensive
experience in their respective fields, and their individual contributions to our
operations may be difficult to replace due to the scarcity of candidates of
comparable caliber and experience. Accordingly, the loss of some or all of these
employees could adversely affect our ability to manage our operations and to
execute our long-term business strategy.

We may not have access to sufficient capital to pursue future growth
opportunities.

    We have sufficient funding to complete the construction and launch of the
NSS-8 satellite. However, in the event that we choose to launch new or
replacement satellites, it is possible that we may not have, or be able to
obtain, the financing required to fund such procurements.

    In addition, if we were to choose to engage in any major business
combination or similar strategic transaction, we may require significant
external financing in connection with such a transaction. Depending on market
conditions, investor perceptions of us, and other factors, we may not be able to
obtain capital on acceptable terms, in acceptable amounts, or at appropriate
times to implement any such transaction.


Risks Relating to Our Industry

Changes in technology could make our business obsolete.

    Continuing technological changes in the telecommunications industry could
undermine our competitive position or make our satellite system obsolete, either
generally or for particular types of services. Particular technological
developments that could adversely affect us include the deployment by our
competitors of new satellites with greater power, greater flexibility, greater
efficiency or greater capabilities, as well as continuing improvements in
ground-based wired and wireless technologies.

Overcapacity and competition in the satellite industry and among terrestrial
competitors may adversely affect our ability to sell our services, exert
downward pressure on prices, or both.

    While we believe that capacity on different satellites or satellite systems
can be distinguished from other satellite capacity in some respects, the
provision of satellite-based capacity and services can be subject to
commodity-like price pressures. In addition, while satellite communications
services and ground-based communications services are not perfect substitutes,
we compete in certain markets and for certain services with providers of
ground-based services.

    Supply of satellite- and ground-based services can increase for a number of
reasons, including:

     o    the launch of new satellites with higher power levels, enhanced
          connectivity, on-board switching or greater frequency re-use, each of
          which can lead to increased capacity and lower per-transponder costs;

     o    the creation of new providers of satellite-based services, which can
          introduce new competition;

     o    wider availability of fiber optic cable and other non-satellite
          transmission services, which can result in less expensive
          alternatives, particularly for point-to-point transmission; and

     o    the implementation of new transmission technologies, such as improved
          signal compression, which can reduce the transponder capacity required
          to transmit the same information.

    Where fiber optic networks or other ground-based high-capacity systems are
available and capable of supporting a particular type of transmission with
comparable service parameters (e.g., ease of installation, coverage, speed, and
quality of signal), that capacity is generally less expensive than satellite
capacity. Further expansions in the reach of terrestrial-based networks may
induce our customers to shift their transmissions to non-satellite capacity or
make it more difficult for us to obtain new customers, thereby adversely
affecting our current and future revenues.

    Similarly, over-capacity and competition in the satellite industry may make
it more difficult for us to sell our services and to maintain our prices for the
capacity that we do sell. This, in turn, could adversely affect our revenues and
our ability to increase our revenues over time.

Demand for satellite services, including bundled services, may not develop in
the manner we anticipate.

    Demand for satellite-based transmission services may stop growing, or may
even shrink. A lack of demand could adversely affect our ability to sell our
services and to develop and successfully market new services, could exert
downward pressure on prices, or both. This, in turn, could adversely affect our
revenues and our ability to increase our revenues over time.

Some of our competitors have greater resources than we do, which may make them
better able to compete in terms of pricing, service offerings, marketing, name
recognition, product development, or otherwise.

    The satellite services industry is highly competitive. We compete with a
number of established service providers, including global and regional satellite
service providers, resellers of satellite capacity, and other service providers.
Some of our competitors have long-standing customer relationships; enjoy close
ties with regulatory authorities or more favorable regulatory treatment; and/or
have the ability to subsidize competitive services with revenues from services
they provide as a dominant or monopoly carrier. Many of them are substantially
larger than we are and have financial resources, experience, marketing
capabilities and name recognition that are substantially greater than ours. As a
result, they may have a competitive advantage over us.

We face risks in operating our business globally.

    We face certain risks as a result of the global nature of our business.
Certain countries may impose withholding taxes on us or on our customers or deem
us to have a permanent establishment in their country. These taxes may make our
services more expensive for customers or impose an unanticipated tax burden upon
us. In addition, such tax burdens may not be imposed equally on our competitors
and may not be alleviated or subject to appeal under existing tax treaties. We
also may face difficulties in enforcing our contracts in certain countries.
Finally, while our contracts generally are denominated in U.S. dollars, and
therefore are not sensitive to our customer's local currency exchange
fluctuations, in some countries economic conditions and currency transfer
restrictions may make it difficult for some of our customers to meet their
payment obligations or to make payments in U.S. dollars.

We may not be able to take advantage of, or may be made less competitive as a
result of, industry consolidation.

    We may pursue acquisitions, joint ventures or other strategic transactions
on an opportunistic basis as consolidation of the satellite services industry
continues to unfold. Our principal focus is likely to be on the acquisition of,
or strategic combination with, another satellite operator as and when suitable
opportunities arise, and on the acquisition of rights to use additional orbital
locations. Under appropriate circumstances, we also would consider acquiring
additional individual in-orbit satellites, transponders on existing in-orbit
satellites, or other established facilities and components necessary for the
provision of bundled services. However, we may not find or be able to take
advantage of any suitable opportunities.

    In addition, industry consolidation could adversely affect us by increasing
the scale or scope of our competitors and thereby making it more difficult for
us to compete.


Risks Relating to Regulation

Our rights to use the orbital locations from which our satellites operate are
subject to regulation at the national and international levels.

    There are a limited number of orbital locations in space from which one can
operate the type of satellites that we operate. Rights to make use of these
orbital locations, and the frequencies over which commercial satellites
transmit, are regulated by the International Telecommunication Union, known as
the ITU. Under the treaty and regulations currently in effect, the Government of
the Netherlands has obtained the rights to use the orbital locations and
frequencies used by our satellites, as well as rights to use certain additional
orbital locations and frequencies. We cannot guarantee that the ITU will not
change these rules in the future. A change in these regulations could limit or
preclude our use of some or all of our existing or future orbital locations or
frequencies.

    The Government of the Netherlands authorizes us to make use of the orbital
locations and frequencies that we use for our existing satellites, as well as at
a number of additional orbital locations. While the government has authorized us
to use these orbital locations, we cannot guarantee that it will not modify or
revoke this authorization. A modification or revocation could limit or preclude
our use of some or all of our in-use or presently unoccupied orbital locations,
or some or all of the frequencies we currently use at these orbital locations.

    With respect to the primary frequencies used by commercial geostationary
satellites, the ITU rules grant rights to member states (which are the national
governments party to the ITU treaty) on a "first-in-time, first-in-right" basis
and set forth a process for protecting earlier-registered satellite systems from
interference from later-registered satellite systems. In order to comply with
these rules, we must coordinate the operation of our satellites, including any
replacement satellite that has performance characteristics that exceed those of
the satellite it replaces, with other satellites. The coordination process may
require us to modify our proposed coverage areas, or satellite design or
transmission plans, in order to eliminate or minimize interference with other
satellites or ground-based facilities. Those modifications may mean that our use
of a particular orbital position is restricted, possibly to the extent that it
may not be commercially desirable to place a new satellite in that location. In
certain countries, failure to resolve coordination issues may be used by
regulators as a justification to limit or condition market access by foreign
satellite operators. In addition, while the ITU's rules oblige later-in-time
systems to coordinate their operations with us, we cannot guarantee that other
operators will operate in a manner that does not adversely affects our
operations.

    Under the ITU's rules and our authorization from the Dutch government, we
must begin using our authorized orbital locations and frequencies within a fixed
period of time. If we do not begin or reinstate use of a particular orbital
location within the applicable deadline, we will lose our priority rights to use
that orbital location.

We are subject to regulatory and licensing requirements in each of the countries
in which we provide services, and our business is sensitive to regulatory
changes in those countries.

    The satellite business is heavily regulated. In particular, we are subject
to and need to comply with the laws and regulations of the European Union, the
Netherlands, and the national and local governments of other countries to, from,
or within which we provide services. In addition, while many countries are
permitting increased competition, some countries continue to have laws and
regulations that may impede or prohibit foreign service providers from entering
their markets. These laws and regulations may affect our ability to use
frequencies and to provide satellite capacity and some or all satellite-based
services in specific regions, or to particular types of customers in a given
jurisdiction.

    Obtaining and maintaining the required regulatory approvals can involve
significant time and expense. Our inability to obtain and maintain particular
approvals may delay or prevent our ability to offer some or all of our services
and adversely affect our revenues.

    Generally, once we have received a regulatory authorization, we need an
additional authorization only if we introduce new services or place a new or
replacement satellite into operation. However, countries may adopt new laws,
policies or regulations, or change their interpretation of existing laws,
policies or regulations, and these changes could occur at any time. Such changes
may make it more difficult for us to obtain or maintain authorizations, cause
our existing authorizations to be cancelled, require us to incur additional
costs, or otherwise adversely affect our operations and revenues.

Export control and embargo laws may preclude us from obtaining necessary
satellites, parts or data or providing certain services in the future.

    U.S. companies and companies located in the United States must comply with
U.S. export control laws in connection with any information, products, or
materials that they provide to us relating to satellites, associated equipment
and data and with the provision of related services. If these entities cannot or
do not obtain the necessary export or re-export authorizations from the United
States government, we must obtain such authorizations ourselves. It is possible
that, in the future, they and we may not be able to obtain and maintain the
necessary authorizations, or existing authorizations could be revoked.

    If our manufacturers and we cannot obtain and maintain the necessary
authorizations, this failure could adversely affect our ability to:

     o    procure new U.S.-manufactured satellites;

     o    control our existing satellites;

     o    acquire launch services;

     o    obtain insurance and pursue our rights under insurance policies; or

     o    conduct our satellite-related operations.

    In addition, if we do not properly manage our internal compliance processes
and were to violate the terms of a license, it could have a material adverse
effect on our ability to maintain or obtain licenses and could result in civil
or criminal penalties.

    We must comply with Dutch and E.U. embargo laws. In addition, some of our
subsidiaries, employees and services are subject to the embargo laws of other
jurisdictions, including the United States. This may adversely affect our
ability to provide satellite-based services to entities in countries subject to
an embargo.

Other Risks

Provisions of our articles of association could be used to delay, or otherwise
impede, a change of control in certain circumstances.

    Our shareholders have authorized us to enter into, and we have entered into,
an option agreement with a Dutch foundation, under which it may acquire a number
of governance preference shares equal to the aggregate number of outstanding
ordinary shares and financing preference shares minus one by making a payment
equal to one-quarter of the nominal value of those governance preference shares.
Under the terms of the agreement, the foundation may exercise the option only if
a person or group of persons acting collectively has acquired shares or voting
rights for 30 percent or more of our outstanding ordinary shares and either has
not made a bona fide public offer for all our remaining outstanding ordinary
shares or has made such an offer but did not acquire more than 50 percent of the
outstanding ordinary shares in our capital in response to the offer, taken
together with the shares that person or group held at the time it made the
offer.

    Under the terms of the agreement, the foundation must make the governance
preference shares available to us for repurchase or cancellation if:

     o    the person or group of persons ceases to hold shares or voting rights
          for 30 percent or more of our outstanding ordinary shares;

     o    our board of management, after consultation with our Supervisory
          Board, has approved the aforementioned acquisition; or

     o    the offeror has made a bona fide public offer for all of our
          outstanding ordinary shares and in response to the offer has acquired
          more than 50 percent of our shares, including shares held by the
          offeror or group associated with the offeror prior to the offer.

    Because the governance preference shares have the same voting rights as
ordinary shares, their issuance could make it more difficult for another entity
to acquire control of us under circumstances described above.

Our share price may be adversely affected by the actual or perceived
availability for sale of a large number of our shares.

    Historically, our shares have exhibited relatively thin daily trading volume
on both the Euronext Amsterdam N.V. exchange and the New York Stock Exchange.
Because our shares are not heavily traded, the price of our ordinary shares may
be adversely affected by sales of large numbers of shares by existing
shareholders, or by the perception that such sales may occur.


ITEM 4.  INFORMATION ON THE COMPANY

                                    BUSINESS

Overview

    Our official name is "New Skies Satellites N.V.". Our principal offices are
located at Rooseveltplantsoen 4, 2517 KR The Hague, The Netherlands, and our
telephone number is +31 70 306 4100. Our company was created on April 23, 1998
as a limited liability company (naamloze vennootschap) organized under the laws
of The Netherlands.

    We are a satellite communications company with global operations and service
coverage. We began independent operations as a privatized, commercial spin-off
from INTELSAT, an intergovernmental organization, on November 30, 1998. At that
time, INTELSAT transferred to us certain assets and liabilities, including
satellites and related contracts.

    Today, we operate a network of six (6) satellites located at five (5)
different fixed orbital positions above the earth, including two (2) satellites
that we have designed, constructed, launched and placed in commercial operation
since our creation in 1998. We also have one additional satellite (NSS-8) that
is currently under construction. Our customers can access one or more of our
geostationary satellites from almost any point around the world. We also have
ground-based infrastructure to operate our satellite network and to provide
additional services to access the terrestrial communications network for data,
voice, video, and Internet services. We have developed and expanded the business
we inherited - the simple provision of satellite-based transponder capacity to
telecommunications carriers and to brokers and integrators who resell it to
third parties - into a broader business where we also provide value-added
services and bundled products directly to a broader base of customers further
down the communications distribution chain.

    The headquarters of our operations is in The Hague, The Netherlands. We have
established sales and marketing regional offices or liaison offices in Beijing,
Hong Kong, Johannesburg, New Delhi, Sao Paulo, Sydney, Singapore and Washington
D.C., to provide regional sales support to our worldwide customer base.

    We completed our initial public offering in October 2000 and listed our
ordinary shares on the official segment of Euronext Amsterdam N.V. and our
American Depositary Shares on the New York Stock Exchange.

2002 Key Events

     o    Daniel S. Goldberg became Chief Executive Officer (CEO) of New Skies
          on January 1, 2002, having served the previous two years as New Skies'
          Chief Operating Officer and, prior to that, as New Skies' General
          Counsel. Mr. Robert Ross, New Skies' CEO from its creation in 1998
          through 2001, will be available as an external advisor to the Company
          through mid-2004.

     o    In 2002, we launched two new  satellites,  NSS-7 in April and NSS-6 in
          December.  The addition of these two new  state-of-the-art  satellites
          increased our total inventory of station-kept  satellite capacity from
          194 transponders(1) to 324 transponders, an increase of approximately
          67 percent.

     o    NSS-7 was placed in commercial service on May 30, 2002. It replaced
          two existing satellites at 338.5o E.L., the NSS-K and NSS-5 (formerly
          NSS-803) satellites. Customer traffic on the NSS-K and NSS-5
          satellites was transitioned to NSS-7. The transition was completed in
          August 2002. The NSS-K satellite was subsequently decommissioned. We
          drifted the NSS-5 satellite to the Pacific Ocean Region to 183o E.L.
          in order to replace another satellite, NSS-513.

     o    Following the transition of traffic from NSS-K and NSS-5, we drifted
          NSS-7 one-half a degree from 338.5o to 338o E.L. to comply with a July
          2002 directive of the Netherlands regulatory authority and to meet
          international frequency coordination requirements. The drift of NSS-7,
          which began in November 2002, was completed in January 2003 without
          significant disruption to customer services.

     o    The NSS-6 satellite was launched on December 17, 2002 and placed in
          orbit at 95o E.L. It was placed into commercial operation in February
          2003.

     o    We made a decision to "re-purpose" the NSS-8 satellite. NSS-8 had an
          original delivery date of August 2003 and was intended to provide
          capacity over the Americas at 105o W.L. We decided to re-purpose the
          satellite as a replacement for the NSS-703 satellite that now operates
          in the Indian Ocean Region. Working closely with the satellite's
          manufacturer, Boeing Space Systems, we have been able to re-purpose
          the satellite at a minimal incremental cost. We expect to launch NSS-8
          during the fourth quarter of 2004.

     o    We strengthened the ground infrastructure supporting our value-added
          service offerings by adding a new digital platform in our Washington
          Mediaport and entering into agreements with third-party teleport
          service providers in the United Kingdom (Kingston Inmedia) and
          Singapore (ST Teleport).

     o    During 2002, we operated one of the most reliable satellite fleets in
          the industry, with a 99.998 percent fleet-wide satellite availability
          rate.

     o    Following our adoption of SFAS No. 142 on January 1, 2002, we took a
          one-time non-cash write-off of $23.4 million reflecting the
          unamortized goodwill that the Company had been carrying on its balance
          sheet from its March 2000 acquisition of AAPT Sat-Tel Pty Ltd. (which
          was subsequently renamed New Skies Networks, Pty Ltd).

     o    In October 2002, we initiated a share buyback program to repurchase up
          to ten percent of our then outstanding shares at prevailing market
          prices. Share repurchases began in November 2002.


------------
(1)  Unless  otherwise  indicated,   when  used  in  this  document,   the  term
     "transponder"  means  "36  MHz-equivalent  transponder",   consistent  with
     satellite industry practice. The number of actual physical transponders may
     differ from the number of 36 MHz-equivalent transponders.


Our Strategy

    Our management has sometimes described 2002 as a "bridge year" for New
Skies, bridging the high-growth period we achieved using the assets we inherited
from our predecessor to the high-growth period that we anticipate achieving
using the new satellites that we have constructed and launched on our own. In
2002, we successfully launched two new satellites and made other important
adjustments to the configuration of our satellite constellation. As a result of
these events, we were obligated to idle a certain amount of our satellite
fleet's capacity in order to achieve the required deployments and corresponding
traffic transitions among satellites in the fleet. By doing so, however, we
believe that we have now positioned the company to take advantage of future
growth opportunities consistent with our long-term strategy.

    Our long-term strategy is to offer a seamless global satellite network to
meet our customers' requirements for the transmission of their video, voice and
data services. We combine our satellite resources with ground-based
communications facilities, some of which we own and others which we procure
through third parties (to whom we refer as "our partner teleports"), as needed,
in order to provide customers with bundled services that meet their transmission
and platform needs.

    We intend to grow our business by:

     o    Selling the capacity on our existing satellites - With the launch of
          NSS-6 and NSS-7, we expanded our inventory of station-kept satellite
          capacity from 194 transponders to 324 transponders, an increase of
          approximately 67 percent. Much of the additional capacity has been
          added in regions where we perceive demand to be increasing, namely
          South Asia, the Middle East and Africa. We intend to sell our
          available capacity through a combination of:

          -    proactive marketing;

          -    providing "value-added services", which bundle satellite capacity
               with ground-based services such as Internet protocol and other
               platform services (including video services) available through
               our teleport facilities or those of our partner teleports; and

          -    pricing our available capacity competitively.

          While we expect our fleet to grow over time, we will enter into
          procurement contracts for new satellites only where we have a
          demonstrated need for additional capacity and a sound business case
          for the particular satellite. As we add new satellites or move
          existing satellites to new orbital locations, we will undertake
          focused marketing campaigns in order to maximize the sales of new
          capacity and to highlight the value of new service areas to our
          customers.

     o    Maintaining and augmenting a diverse customer base - We market and
          provide our satellite capacity to major broadcasters, distributors and
          telecommunications providers, and to customers further down the
          distribution chain. Our provision of bundled services has aided us in
          achieving an expansion in our customer base over the past four years,
          and we expect this trend to continue. As we augment and diversify our
          customer base, we endeavor to retain a balanced mix among customers
          with regard to both service type and region. This balance helps
          position us to be able to capture new demand wherever it may arise,
          and to reduce the risks associated with over-reliance upon any one
          market segment or geographic region.

     o    Expanding the services we offer to include a range of selected bundled
          services - In addition to continuing to provide space segment-only
          services to certain customers, we provide value-added services which
          bundle space segment with services provided through ground-based
          facilities, such as video and Internet protocol platforms which reside
          in our own teleports or in our partner teleports.

     o    Acquiring other businesses and entering into strategic transactions -
          We also intend to pursue acquisitions, joint ventures or other
          strategic transactions on an opportunistic basis as consolidation
          within the satellite services industry continues to unfold. Our
          principal focus is likely to be on the acquisition of, or strategic
          combination with, another satellite operator as and when suitable
          opportunities arise, and on the acquisition of rights to use
          additional orbital locations. Under appropriate circumstances, we also
          would consider acquiring additional individual in-orbit satellites,
          transponders on existing in-orbit satellites, or other established
          facilities and components necessary for the provision of bundled
          services.

Our Services

    We currently offer satellite capacity for different applications, which may
be grouped as follows:

     o    video transmission;

     o    private data and voice networks and traditional telephony
          applications; and

     o    Internet-related services.

    Video Transmission

    Our C- and Ku-band global satellite fleet is well-suited to distribute video
signals, on both a point-to-point and point-to-multipoint basis, to ground-based
broadcasting systems around the world, directly to some private
telecommunications networks used by businesses via small antennas, and for
direct-to-home (DTH) applications. We estimate, based on frequency plans
supplied by our customers, that video transmissions have comprised the single
largest source of our revenues since we began independent operations, and
represented approximately 41 percent of our revenues in 2002.

       Cable and Broadcast Television Distribution

    We broadcast television channels to international, regional and national
cable and television networks in Latin America, the Middle East, Africa and
India. This makes our satellites attractive to potential customers for satellite
capacity who would also like to transmit similar or related programs to those
cable or television systems. These groupings of similar channels that develop
are referred to as "neighborhoods". As it can be difficult to redirect the
ground-based antennas, or cable head-ends, of a local cable network that has
multiple antennas, and because groupings of popular channels tend to build
viewer loyalty, video broadcasters often try to develop neighborhoods in markets
with relatively homogeneous viewing characteristics. The New Skies satellites
with significant video neighborhoods are:

     o    NSS-806, which currently reaches cable headends throughout Latin
          America, Western Europe and parts of North America and has one of the
          leading video neighborhoods in Latin America;

     o    NSS-7, from which an offering of leading French language channels,
          such as TV5 Afrique, Canal+Horizons, MCM and CFI target the African
          market; and

     o    NSS-703, which is a key distributor of news and entertainment
          programming throughout Africa, the Middle East and Asia.

       Television Contribution Services

     We provide our broadcast customers with capacity for both regular
television contribution feeds and occasional coverage of special sports, news or
other scheduled events and fast-breaking news stories of global and local
interest. Contribution feeds are signals collected by programmers from multiple
sources or transmitted from the location where specific events are taking place
back to video production facilities. Our customers use contribution feeds to
integrate different segments or special events into a consolidated video program
for broadcast to their customers. We provide television contribution services on
a long-term basis to customers who have a regular need for such services. For
example, the European Broadcast Union (EBU), a group of 119 broadcasters from 80
countries, uses capacity on the NSS-7 satellite and our Washington Mediaport for
the delivery of contribution footage from the United States to its member
broadcasters throughout Europe and the Middle East.

     We also allocate specific capacity for occasional-use services on a
short-term basis for customers who have a temporary need for capacity. We have a
special booking operation for television contribution services to accommodate
major broadcasters such as the EBU, CNN, Reuters and the BBC. Demand for
short-term services is event-related and sometimes unpredictable. Customers
generally request short-term contribution services either in connection with
major international sporting events, such as the Olympics or World Cup, or in
connection with major breaking news events that attract sustained international
attention.

    Data and Voice

    We provide transponder capacity for the operation of private data and voice
networks for governments and businesses in various countries, usually through
carriers, third-party resellers, and other network integrators. Our satellites
support high-bandwidth transmissions, which allow these customers to transmit
information quickly and reliably using relatively small antennas known as VSATs
(very small aperture terminals), which can be located on a business rooftop.
Private networks use VSAT antennas to create a dedicated, interconnected
communication link allowing various geographically dispersed sites to connect
into a central location. Each remote site is able individually to send and
receive information directly to and from the central site.

    We also provide transponder capacity for a number of telephone applications
worldwide. The majority of this business has been the transmission of telephony
on behalf of intermediaries and resellers to and from major post, telephone and
telegraph administrations. We have also begun to market these services to
customers in countries where regulators are opening the telecommunications
market to competition, particularly in Asia and Africa. These markets may offer
substantial demand and new opportunities to provide telephony and related
services at profitable levels.

    In 2002, satellite capacity used for data and voice service applications
accounted for approximately 32 percent of our total revenues, increasing from 30
percent of total revenues in 2001. We expect continued demand for capacity to
provide data and voice services in 2003, driven in part by government
requirements for these services and in part by increasing requirements for
international long-distance voice services from newly authorized service
providers in countries undergoing telephony deregulation. These sources of
demand have helped to counter-balance the general trend toward the use of fiber
optic networks for voice services, and we expect that this segment will continue
to contribute to our revenues over time (although possibly at declining levels).

    Internet-Related Services

    Our satellites connect Internet service providers, businesses and other
customers further down the signal distribution chain who may be in locations
that do not currently have a direct high speed connection to the U.S. or
European Internet backbone. For example:

     o    NSS-703 provides a high-bandwidth Internet connection between the
          Indian subcontinent and South East Asia and the European Internet
          backbone;

     o    NSS-7 provides high-bandwidth connectivity between European Internet
          service providers and the United States and between the Middle East
          and Africa and the Internet backbone; and

     o    NSS-806 serves the same function for this traffic from the United
          States to South America.

    Our primary suite of branded Internet bundled service offerings is called
IPsys(R). These offerings are capable of providing high-speed Internet backbone
connections to Internet service providers, or ISPs, in virtually all regions of
the globe. Since the launch of our IPsys(R) service in May 2000, sales have been
strong. At present, we provide Internet connectivity to customers in India, the
Middle East, Africa, Latin America, and other regions. We target Internet
service providers, multinational corporations and broadcasters for IPsys(R) and
related bundled services.

    To support our IPsys(R) service offerings, we built and operate our own
Network Operations Center, and have installed high-bandwidth digital video
broadcast (or DVB) and frame-relay platforms at the ground facilities through
which we connect to the Internet backbone, as well as other
performance-enhancing equipment.

    Revenues from Internet-related traffic represented approximately 27 percent
of our total revenues in 2002, down slightly from 29 percent of revenues in
2001.

Sales and Marketing and Customers

    We have significantly broadened and expanded our customer base since our
creation in order to increase revenue opportunities while reducing the risks
associated with selling to a limited number of customers. In addition to
providing services to large telecommunications companies, we now also provide
transponder capacity and other services directly to other commercial resellers,
such as network system integrators, ground stations or capacity brokers, as well
as to some of the larger customers further down the distribution chain.

    During 2002, we provided service under contract to more than 240 customers
worldwide. Our ten largest customers represented approximately 48 percent of our
total revenues in 2002.

    Our sales and marketing personnel are divided into six regions: (i) North
America; (ii) Latin America; (iii) Europe; (iv) Asia Pacific; (v) India, the
Middle East and Africa; and (vi) Australasia. We currently have approximately 76
employees who sell, market and provide sales support for our services worldwide.

    We manage our sales, marketing and billing activities from our headquarters
in The Hague. We also have established regional sales or liaison offices in
North America (Washington DC), South America (Sao Paulo), Asia (Singapore, Hong
Kong, Beijing and New Delhi), Africa (Johannesburg) and Australia (Sydney).

    Contracts

    In 2002, we signed 333 new contracts with our customers. Our contracts
generally are denominated in U.S. dollars; provide for payment monthly in
advance; are non-preemptible and non-cancelable during the term (or allow
customers to cancel their commitments only under certain limited conditions and
the payment of significant penalties); and otherwise provide a level of
protection consistent with industry practice. Although the contracts can be
terminated in the event of certain capacity malfunctions, we generally have a
cure period. A small percentage of our current contracts (approximately 10
percent) were assigned or otherwise transferred to us by our predecessor and may
have terms and conditions that differ from our standard agreements (e.g.,
payment quarterly in arrears rather than monthly in advance).

    Backlog

    For 2002 backlog, see Item 5, "Operating and Financial Review and
Prospects".

Our Satellites

    We currently operate and provide commercial service through a network of
five (5) communications satellites positioned in fixed (station-kept)
geosynchronous orbits (NSS-5, NSS-6, NSS-7, NSS-703 and NSS-806). We have one
additional satellite, NSS-513, which is in inclined orbit and is not currently
being used to provide commercial services. We have one additional satellite,
NSS-8, currently under construction, and have also received authorizations from
the Dutch government to use certain additional orbital locations for future
satellites.

    For 2002, we operated one of the most reliable satellite fleets in the
industry, with a 99.998 percent fleet-wide satellite availability rate.

    Our satellites are located approximately 22,300 miles (35,700 kilometers)
above the earth. We operate five of our satellites in station-kept mode, which
means that they maintain their geosynchronous position over the equator within
tightly controlled limits (plus or minus .05o). Because of this control, most
earth antennas within a satellite's beam can communicate continuously with the
satellite without having to track it in orbit. Our oldest satellite, NSS-513, is
in geosynchronous orbit, but it is not station-kept. While we keep the satellite
in the same east-west position above the earth, we allow it to drift north and
south relative to the equator which we call "inclined orbit" operation. It is
typical in the industry to operate a satellite that is near the end of its
useful life in an inclined orbit mode.

    Our newest satellites, NSS-6 and NSS-7, are designed to carry additional and
more powerful transponders than the satellites that we inherited from our
predecessor at the time of our creation, although to a limited extent our
ability to use additional power and frequencies may be limited by technical and
regulatory limits (including, for example, those agreed to in relevant
coordination agreements). They were also designed to provide better connectivity
and to allow for more operational flexibility than our inherited satellites.

    In-Orbit Satellites

       NSS-5

    In 2002, we relocated NSS-5 (formerly known as NSS-803) from 338.5o E.L. to
its current orbital location at 183o E.L. to replace NSS-513. NSS-5 was brought
into commercial use in its new location in January 2003.

    NSS-5 is our principal connectivity satellite for the Pacific Ocean Region
and provides coverage of certain areas in North America, Asia and Australia.
NSS-5 is one of the few satellites that can connect North America with all major
destinations in the Pacific Rim. NSS-5 provides station-kept capacity with high
performance and greater throughput than the NSS-513 satellite. Access to the
satellite from the West Coast of the United States, Canada and Mexico can be
achieved at C-band frequencies on global, hemispheric or zone beams. The
satellite also has a steerable Ku-band spot beam over North America that can
provide additional connectivity and can include Hawaii. Over Asia, a second
steerable Ku-band spot beam has initially been deployed over Japan and Korea.
The western zone beam of NSS-5 covers major destinations such as China, Hong
Kong, and Singapore. Hemispheric coverage extends from the north of China to
Australia and New Zealand.

    One of two duplicate power subsystem units on NSS-5 - a low-voltage bus
converter - stopped operating in 2002. The manufacturer of the satellite has
informed us that the duplicate unit that is currently not operational should
automatically restart if the single unit that is currently operating fails. If
this did not occur, the satellite might prematurely cease to operate (although
we believe that there is only a low risk that the currently operating unit will
fail and that other unit will not restart).

       NSS-6

    NSS-6 was launched successfully on December 17, 2002 to the 95(degree) E.L.
orbital position (over the Asia-Pacific Region) and was placed into service in
early 2003.

    NSS-6 is equipped with 60 36-MHz-equivalent Ku-band transponders. From the
orbital slot at 95o E.L., NSS-6's six high power Ku-band beams provide coverage
of India, China, the Middle East (including Cyprus and Southern Africa),
Australia, Southeast Asia and Northeast Asia. Additionally, NSS-6 has 10 uplink
spot beams in the Ka-band, fixed on the strategic markets of Hong Kong,
Shanghai, Beijing/Tianjin, Wuhan, Taiwan, Seoul, Tokyo/Osaka, Mumbai,
Bangalore/Chennai, Delhi, Sydney and Melbourne. Each of the Ka-band uplinks can
be used in lieu of one Ku-band uplink.

    NSS-6 has significantly greater Ku-band capacity and power than any of our
current satellites. The design of NSS-6 permits extensive transponder switching
among beams, allowing us to reassign capacity among geographic regions in
response to market demand. Moreover, NSS-6 has a broad coverage area and a high
degree of intra-satellite interconnectivity, which will make it possible,
depending on the relevant transmission, for a customer to uplink a signal from
one region and downlink that signal to a different region using a different
transponder.

    NSS-6 is designed to serve a wide range of customers, including
broadcasters, telecommunications carriers, DTH service providers, ISPs,
corporations and other enterprise customers. Its versatile Ku-band and Ka-beams
can also be interconnected ("cross-strapped"), offering enhanced connectivity
throughout its service area.

       NSS-7

    NSS-7 was launched in April 2002 and entered commercial service in May 2002.
It is the first satellite that we designed, constructed and launched entirely
during the course of our operations as an independent company.

    We deployed NSS-7 to 338.5(degree) E.L. (over the Atlantic Ocean Region) to
replace the NSS-K and NSS-5 satellites. Following the transition of customer
traffic from NSS-K and NSS-5, we relocated the NSS-7 by one-half degree to 338o
E.L., its current location, in order to comply with a directive of the
Netherlands government and to meet international frequency coordination
requirements.

    NSS-7 has greater combined capabilities than the two satellites that it
replaced, including higher power, enhanced geographic coverage, and a larger
number of transponders. NSS-7 was built by Lockheed Martin and has a 12-year
design life. It has 49 36-MHz-equivalent C-band and 48 36-MHz-equivalent Ku-band
transponders. It offers the ability to transmit or receive a large number of
C-band and Ku-band signals simultaneously, with a high level of
interconnectivity between different beam coverages on a channel-by-channel
basis. NSS-7 is specifically designed, by means of on-board switching, to
facilitate asymmetric traffic between coverage areas. Its capabilities,
including in particular its higher power, will allow many customers to use
smaller antennas.

    NSS-7 supports a variety of services, including video distribution and
contribution, Internet access, private telecommunications networks used by
businesses, and fixed services such as telephone and data transmission. In
addition, capacity can be flexibly assigned to eleven high-powered coverage
beams, blanketing the Americas, Europe, the Middle East and Africa.

       NSS-513

    We removed NSS-513 from commercial service at its current location,
183(degree) E.L., in December 2002 following the relocation of NSS-5 to that
orbital location and the transfer of customer traffic from NSS-513 to NSS-5.

    NSS-513 has 42 36-MHz-equivalent C-band transponders and 16
36-MHz-equivalent Ku-band transponders. NSS-513 is currently maintained in
inclined orbit, rather than in station-kept orbit. This was done to preserve
fuel that we otherwise would use to keep the satellite over the equator. Because
a satellite in inclined orbit moves in a predictable pattern, only antennas that
can track the satellite are capable of maintaining uninterrupted communications.
NSS-513 has sufficient propellant to continue its inclined-orbit operations for
one to two years depending on where it is relocated and its health.

    We are currently considering possible future commercial uses of the NSS-513
satellite.

       NSS-703

    NSS-703, located at 57o E.L., provides a wide range of services, as the
television and telecommunications needs of the multiple regions it serves are
diverse. Analog and digital television broadcasters, post, telephone and
telegraph authorities and communications service providers are the primary users
of this satellite. NSS-703 is used for telephone services in Asia Minor, cable
television distribution in India and for television distribution and
contribution throughout the Asia Pacific Region.

    NSS-703 provides service via 38 C-band transponders and 20 Ku-band
transponders. Its C-band hemispheric beams cover two major regions. The first is
Africa. The second is the triangle from Eastern Iran to Japan to Australia.
Within this region, NSS-703 offers complete India and China coverage. These
hemispheric beams are supported by four zone beams, which are optimized to
provide service to sub-regions of northeast Asia, Southeast Asia and Australia,
southern Africa and from northern and western Africa to the Mediterranean Sea.
We have currently deployed the satellite's three fully steerable Ku-band spot
beams to service Europe, central Asia and the Arabian Peninsula. We are
currently planning to replace NSS-703 with NSS-8 following NSS-8's launch (which
is expected to occur in the fourth quarter of 2004). Following replacement of
NSS-703 by NSS-8, we are currently planning to re-deploy NSS-703 to another
orbital location.

       NSS-806

    NSS-806, located at 319.5o E.L., provides C-band and Ku-band coverage of the
Americas and Europe. It transmits a neighborhood of 104 Spanish language cable
television channels to South America, including video channels from Argentina,
Brazil, Venezuela, Colombia, Peru, Bolivia and the United States, as well as
other regional services and international channels.

    NSS-806 has 36 C-band transponders and 6 Ku-band transponders. It contains a
single high-powered beam that provides simultaneous coverage of the Spanish- and
Portuguese-speaking regions of both the Americas and Europe. In addition to
providing coverage of the Latin American markets, it reaches the Iberian
Peninsula, the Canary Islands, Western Europe and much of Eastern Europe via a
high-power hemispheric beam. This facilitates the distribution of programming
from both Latin American content providers and North American and European
content providers to Latin American cable networks. The satellite also features
a spot beam covering Mercosur (Argentina, Brazil, Paraguay, Uruguay and Chile)
with high-powered Ku-band coverage over urban areas. This capacity is well
suited for use by corporate network communications. The high power of NSS-806's
signals helps to ensure that its signals can be delivered to small antennas.

    Planned Satellites

       NSS-8

    In March 2001, we entered into a construction and launch contract for our
NSS-8 spacecraft with Boeing Satellite Systems, formerly Hughes Space and
Communications. NSS-8 originally had been planned for launch in late 2003 to
serve the Americas market from 105o W.L.

    We have decided, however, to re-purpose the NSS-8 for deployment to the
57(0) EL. orbital slot as a replacement satellite for NSS-703 satellite
currently located in that slot. By doing so, we will provide expansion capacity
in response to demand in the Indian Ocean Region. NSS-8 is now expected to be
launched in the fourth quarter of 2004.

    NSS-8 will carry 56 C-band and 36 high-power Ku-band transponders, making it
one of the largest and highest power satellites with coverage of Europe, the
Middle East, India, Africa and Asia. As part of our contract with Boeing
Satellite Systems, they are required to deliver the spacecraft to us in orbit.
Currently, the contract calls for the manufacturer to use a Sea Launch Zenit
vehicle to launch the satellite (although under certain circumstances we can
designate a substitute launch vehicle).

    By deploying our newest, largest, and most powerful satellite to an
established orbital location in the Indian Ocean Region, New Skies will endeavor
to continue to meet the current and future needs of its many customers
throughout India, Asia, the Middle East, and Africa as well as capitalize on the
region's strong projected growth.

    The table below summarizes selected data relating to our six operational
satellites and the NSS-8 satellite which is currently under construction:
<TABLE>
<CAPTION>
                                                                                                                   Satellites under
                                                 In-orbit Satellites                                                 construction
                --------------------------------------------------------------------------------------------       ----------------
                    NSS-513(1)        NSS-6          NSS-703          NSS-5           NSS-806          NSS-7            NSS-8
                -------------------------------------------------------------------------------------------------------------------
<S>                  <C>             <C>              <C>            <C>             <C>              <C>                <C>
Orbital position     183o            95o              57o            183o            319.5o           338o               57o
                     East            East            East            East             East            East              East
                  (177o West)    (265o West)      (303o West)     (177o West)     (40.5o West)     (21o West)        (303o West)
                                                                                                                      (planned)
Land regions
served:               --             --          Europe, Asia,  North America,  Europe, Americas Europe, Africa,    Europe, Asia,
  C-band........                                  Australia,    Asia, Australia                     Americas,    Australia, Africa,
                                                    Africa                                         Middle East       Middle East

  Ku-band.......                 Middle East,   Europe, Central North America,     Argentina,    Europe, Africa,
                      --            Asia,            Asia,           Asia            Brazil         Americas,       Europe, Asia,
                                  Australia       Middle East                                      Middle East   Australia, Africa,
                                                                                                                     Middle East

  Ka-band.......      --         Middle East,         --              --               --              --                --
                                    Asia,
                                  Australia

Launch date.....   May 1988     December 2002    October 1994   September 1997    February 1998    April 2002    Fourth Quarter 2004
                                                                                                                       (est.)

Manufacturer....Ford Aerospace Lockheed Martin  Space Systems/  Lockheed Martin  Lockheed Martin Lockheed Martin  Boeing Satellite
                                                     LORAL                                                             Systems
Number of
transponders:(2)      42             --             42                61               36              49                56
  C-band........
  Ku-band.......      16             60             24                12               6               48                36
  Ka-band.......      --             12             --                --               --              --                --
                      --             --             --                --               --              --                --
    Total.......      58             60 (4)        66 (5)             73  (5)          42              97               92 (5)
Maximum signal
strength
at receiving
antenna
(decibel-watts):  23.5 to 29         --            26 to 36        29 to 36        36 to 37.2       38 to 40          38 to 43
(3)
  C-band........
  Ku-band....... 41.1 to 44.4      44 to 52       44.5 to 47       44 to 47         42 to 49        46 to 49          48 to 52
  Ka-band.......      --             --               --              --               --              --                --
Power output
(kilowatts):(6)
  At beginning of
    life........      1.7            13.6             4.9             6.2              7.1            12.7           16.0 (est.)
  At end of
orbital design
    life........      1.3            12.0             4.0             4.8              5.4            10.7           13.8 (est.)
Orbital design
life,
end(7)..........   May 1995     February 2015     August 2005   September 2007     March 2008      April 2014      12 years after
Anticipated                                                                                                       delivery in orbit
commercially
operable end
of life(8)...... See note (1)   First Quarter    Third Quarter   Third Quarter    Third Quarter   Third Quarter    (est) 16 years
                     below           2019            2009            2015             2016            2015        after delivery in
                                                                                                                          orbit
</TABLE>

--------------------------


(1)  NSS-513 is presently operating in inclined orbit and is not in commercial
     service at its current orbital location . See "In-orbit Satellites:
     NSS-513."


(2)  Satellite transponders receive signals from uplink ground stations, then
     convert, amplify and transmit the signals to downlink ground stations. This
     table states the transponder capacity of our satellites in terms of the
     number of 36 MHz equivalents of capacity they can handle. Actual
     transponders range in size. For example, there are 36 MHz, 54 MHz, 72 MHz
     and 112 MHz transponders.


(3)  Measures the transmission power of a transponder based on the strength of
     the signal received by a ground station antenna in decibel-watts. Smaller
     and less expensive ground station antennas can be used with transponders
     that provide higher signal strength at a receiving antenna.


(4)  NSS-6 satellite has 60 transponders, all of which operate in the Ku-band
     for downlink (satellite-to-customer) transmissions and can operate in the
     Ku-band for uplink (customer-to-satellite) transmissions. The satellite
     also contains 12 Ka-band uplink transponders, up to 10 of which can be
     activated at any given time. If activated, a Ka-band uplink operate in lieu
     of one Ku-band uplink.


(5)  For technical reasons, we sometimes configure a satellite so that certain
     transponders are not operational. For example, in order to optimize NSS-5's
     overall performance we are operating it in a manner that effectively
     reduces the number of operational C-band transponders to 55 and we are
     operating NSS-703 in a manner that effectively reduces the number of
     operational C-band transponders to 38 and Ku-band transponders to 20.
     Similarly, we anticipate we will configure NSS-8 in a way that will yield
     only 88 operational transponders.


(6)  Power available, as required under the terms of the satellite construction
     contract, is measured in kilowatts.


(7)  The manufacturer determines a satellite's in-orbit design life. The
     manufacturer contractually commits that the satellite will be able to
     maintain its contractually specified performance throughout this period.


(8)  We estimate anticipated commercially operable life based on a number of
     factors and we update these estimates periodically based on each
     satellite's actual in-orbit performance. The most important factor is the
     length of time during which a satellite's on-board propellant is projected
     to permit maneuvers to keep the satellite in geosynchronous orbit. Under
     appropriate circumstances we would also consider other factors, including
     remaining on-board redundant systems and expected performance of satellite
     components.




    Additional Future Satellites

    We anticipate that we may launch additional satellites in the future, both
to replace our existing satellites as they near their end of life and, depending
upon market conditions, to expand our scale and scope by expanding the size of
our in-orbit fleet.

     We regularly study the demand for satellite services in various regions and
for different applications in order to keep abreast of opportunities. While we
are committed to a long-term strategy of enhancing our satellite fleet, we
expect to enter into procurement contracts for new satellites only where we have
an expected need for the additional capacity and a sound business case for
demand for the particular satellite.

      We may further expand our global coverage, capacity and service offerings
by deploying satellites into new orbital locations. The exact location and
intended use of each of our satellites is subject to various governmental
approvals, coordination issues and other regulatory risks. See "Government
Regulation".

     We may also choose to enter into arrangements with other satellite
providers to use existing orbital and satellite resources at a single orbital
location to expand the respective commercial service offerings of both
operators. We believe such arrangements may make productive use of our orbital
locations without making additional capital expenditures or incurring
significant incremental expenses. Such arrangements are subject to applicable
law and regulation, which may limit their scope or application.

Satellite Operations and Related Facilities

    We perform tracking, telemetry and control (TT&C) functions for all but one
of our satellites from our satellite operations center located in The Hague.
Because NSS-513 had only limited remaining anticipated commercial life when we
inherited that satellite, we have contracted with a third party to perform TT&C
functions for that satellite.

    TT&C functions involve (i) tracking our satellites and ensuring that they
maintain the designated geostationary orbital position; (ii) receiving
information about the operational status of our satellites via the transmission
of coded data; and (iii) relaying operating instructions to our satellites,
including regular maintenance activities and, in the event of component faults,
diagnostic tests and initiation of redundant subsystems.

    The satellite operations center is supported by additional sites around the
globe that we own or lease, and which allow us to communicate with our
satellites. Each of our satellites can communicate with at least two of these
remote TT&C facilities so that flight command instructions and return
performance data can be sent reliably between the satellite operations center
and the satellite on a redundant basis.

    In addition, we perform all of our payload management and carrier monitoring
services with respect to all of our satellites from our own payload operations
center located in The Hague. These functions include (i) monitoring the
appropriate frequencies and power settings for each signal being transmitted by
the satellite in order to preclude interference with other customers or third
parties; (ii) monitoring the quality of signals being transmitted by the
satellite; and (iii) verifying that the customer traffic on our satellites is
being transmitted in accordance with contractual obligations and our operating
procedures. Most of the data provided to our payload operations center regarding
the traffic carried over our satellites is collected by a network of carrier
service monitoring sites that we own or lease worldwide, which measure the usage
of the transponders and quality of service on our satellites.

    These critical TT&C and payload management and carrier monitoring functions
are supported by an auxiliary satellite operations center and auxiliary payload
operations center located at a separate facility in Belgium. These centers are
fully redundant, routinely tested and operate on a stand-by basis to provide an
immediately usable emergency back-up to our primary operations centers at our
headquarters.

Network Operations Facilities

     We currently own and operate ground-based facilities in the United States
and Australia. Our mediaport in the United States, which is located near
Washington, D.C., provides uplink and downlink services to our NSS-7 and NSS-806
satellites. We also have installed equipment at this mediaport and leased fiber
optic cable capacity that enables us to transmit signals between our satellites,
on the one hand, and the U.S. Internet backbone, the public telephone network
and private telecommunications networks used by businesses, on the other hand.
We have a number of teleports across Australia, including two substantial
facilities in Perth and Adelaide. Our Australian teleports can access NSS-5 and
NSS-6 and provide a wide variety of satellite networking and Internet-related
services.

     We also enter into agreements with third parties to provide the teleport
facilities and services which we require in locations around the globe where we
do not have our own terrestrial facilities. In 2002, we concluded such
agreements with teleport operators in the United Kingdom and Singapore, and in
January 2003, with an operator in Hong Kong, thereby adding to the existing set
of relationships that we have with teleport operators on the West Coast of the
United States and the Middle East. We regularly evaluate opportunities to enter
into agreements with teleport operators in strategic locations with facilities
that can access our satellites and facilitate our customers' use of our
services.

     To support IPsys(R) and our other bundled services, we have installed at
our Washington Mediaport and at one or more third-party teleports high-bandwidth
digital video broadcast, or DVB, platforms, as well as equipment that permits
the provision of video-based bundled services such as the compressed
multi-carrier-per-channel transmission of video networks. We have also developed
additional platform facilities to serve customers in Asia, the Middle East and
Africa.

Satellite Operations Risk Management

    Launch Insurance

    We obtained launch insurance for our NSS-7 and NSS-6 satellites, which were
launched in 2002. Launch insurance policies typically cover claims arising from
events that take place during launch and for a fixed period of time following
launch (in the case of NSS-7 and NSS-6, for three years). Launch insurance
policy coverages include:

     o    catastrophic loss of a satellite during launch;

     o    the failure of a satellite to obtain proper orbit; and

     o    the failure of a satellite to perform in accordance with design
          specifications during the policy period.

    The terms of launch insurance policies generally provide for payment of the
full insured amount if 75 percent or more of a satellite's communications
capacity or life is lost within the period, and, partial payment for losses of
less than 75 percent of the satellite's communications capacity within this
period. Launch insurance policies include standard commercial launch insurance
provisions and customary exclusions in launch policies. Special exclusions may
be added in light of the performance of a particular type of satellite or launch
vehicle.

    We currently intend to procure launch insurance for our future satellites in
an amount approximately equal to the net book value of the construction, launch
and launch insurance costs for each satellite at the initial date of coverage.
We may obtain a re-launch guarantee from the launch service contractor, either
in addition to obtaining launch insurance or in lieu of a portion of that
insurance.

    In-Orbit Insurance

    Our in-orbit insurance policies cover claims that relate to events that take
place after the expiration of the relevant launch insurance policy. This
coverage includes the failure of a satellite to continue performing in
accordance with design specifications. Partial failures or anomalies which occur
during a policy period, but which do not give rise to a claim, may be excluded
in renewal policies. Our in-orbit policies include customary commercial
satellite insurance exclusions.

    We seek to obtain in-orbit insurance with respect to our satellites in an
initial amount approximately equal to the unamortized construction, launch and
insurance costs for each of them. We have obtained in-orbit insurance for our
in-orbit satellites, except that we do not have in-orbit insurance for NSS-513
because it currently has no residual book value.

    The amount of in-orbit insurance in force with respect to each of our
satellites will generally decrease over time, typically based on its declining
book value. Typically, in-orbit insurance is renewed annually.

    As is common in the industry, we have not insured against lost revenues in
the event of a total or partial loss of the communications capacity or life of a
satellite.

Employees
    At December 31, 2002, we had approximately 264 full-time employees. We
believe that our relations with our employees are good.

Property

    We established our global headquarters in The Hague in 1998. We own our
headquarters buildings. Our headquarters facilities house our satellite
operations center, payload operations center, operating and engineering staff,
and our sales, marketing and other administrative personnel.

    We currently own and operate teleports in Bristow, Virginia, USA (the
Washington Mediaport), Perth, Western Australia and Adelaide, South Australia.

    We lease office space, either directly or through a local operating
subsidiary, for regional sales or liaison offices in North America (Washington
DC), Australia (Sydney), South America (Sao Paulo), Asia (Singapore, Hong Kong,
Beijing and New Delhi) and Africa (Johannesburg).

    See also "Satellite Operations and Related Facilities" and "Network
Operations Facilities".

Legal Proceedings

    We are often engaged in proceedings before national telecommunications
regulatory authorities. See "Government Regulation". In addition, we also may
become involved from time to time in other legal proceedings arising in the
normal course of our business. We believe that none of these proceedings, either
individually or in the aggregate, is currently likely to have a material adverse
effect on our business or our consolidated financial position.

Competition

    We are one of four global satellite operators. We compete against other
global, regional and national satellite operators and, to a lesser extent, with
suppliers of ground-based communications capacity.

    The other three global satellite operators are Intelsat, PanAmSat and SES
Global, all of which have substantially larger satellite fleets than New Skies.
We also compete with a number of nationally or regionally focused satellite
operators in each region of the world, such as Eutelsat and Loral. Based on our
analysis of market trends, we believe that the number of satellite operators may
decrease slightly or remain broadly constant, with consolidation of the industry
offsetting the emergence of any new operators. Several of our many competitors
whose operations are principally regional may expand their operations through
acquisitions and alliances in an effort to become global operators or may be
acquired by another regional or global operator.

    Fiber optic cable operators may provide an alternative to satellite
capacity, principally on point-to-point long-distance routes, especially
transoceanic routes. The growth in this capacity, particularly across the
Atlantic Ocean, and the reduction in prices of that capacity have led some
services (between major city hubs, including most voice and data traffic and
some video traffic) to migrate from satellite to fiber optic. However,
satellites may remain competitive for signals that need to be transmitted beyond
the main termination points of the fiber optic cables. Satellite capacity is
also competitive in parts of the world where providing fiber optic cable
capacity is not yet cost-effective. Satellites also remain the medium of choice
for broadcast and multicast (or point-to-multipoint) applications.

    Satellite Operators

    Intelsat Ltd. Intelsat, Ltd. is the privatized successor of the
International Telecommunications Satellite Organization (INTELSAT). From 1964
until 2001, INTELSAT operated as an international treaty organization with a
mandate to provide satellite capacity on a non-discriminatory basis to countries
around the world. In July 2001, INTELSAT was privatized by transferring the
assets and liabilities of the intergovernmental organization into a for-profit
satellite operator. Intelsat, Ltd. operates 24 satellites.

    PanAmSat. PanAmSat is another company that we directly compete with in
providing global satellite telecommunications services. PanAmSat currently has a
fleet of 23 satellites. PanAmSat has a particularly strong presence in North and
South America.

    SES Global. SES Global was created in 2001 through the merger of two
regional operators, GE Americom and SES Astra. The company operates 29
satellites of its own and another 13 through equity participations. We do not
compete against SES Global's core direct-to-home consumer video services in
Europe or in cable distribution in the US.

    Loral. Loral, which is also a principal manufacturer of satellites, has
acquired interests in a fleet of 10 satellites since 1997 by acquiring Skynet,
Orion Network Systems, a 75 percent stake of SatMex and entering into a joint
venture with Alcatel to create Europe*Star. Loral has entered into joint
marketing arrangements with other regional and national satellite operators
under the umbrella of the "Loral Global Alliance". This has enabled Loral to
expand its coverage beyond its principal home markets.

    Regional and Domestic Providers. We compete against a number of regional
providers of transponder capacity. These entities include, among others:

     o    Arabsat in the Middle East;

     o    Eutelsat and Europe*Star in Europe, Africa, the Middle East, and on
          trans-Atlantic routes;

     o    Measat, AsiaSat, Apstar and Shinawatra in Asia; and

     o    SatMex, Star One and Nahuelsat in Latin America.

    These entities are active in regions in which we provide facilities and
services. A number of other countries have domestic satellite systems that we
also compete against to some extent, although most of our business is
international in scope.

    Proposed Satellite Systems

    Other companies have announced plans to operate regional or transoceanic
satellite systems. The international satellite communications industry, however,
imposes significant barriers to entry. The construction and launch of a
satellite comparable to our newest satellites usually takes approximately two or
more years and costs approximately $250 million to $300 million. In addition,
there are a limited number of orbital positions and frequencies that can be
coordinated for use through the International Telecommunication Union. The
operation of an international satellite communications system also requires
approvals from particular national telecommunications authorities. While the
trend around the world is to liberalize these regulatory requirements, at
present obtaining the necessary authorizations involves significant time,
expense and expertise.

    Resellers

    We also compete against service providers that offer business communications
and other satellite-based services reselling satellite capacity provided by
other operators, including companies such as Globecast, BT and Verestar. Certain
service providers also use leased satellite capacity to provide limited services
to broadcasters, primarily for ad hoc applications. We also compete in some ways
with local post, telephone and telegraph agencies who provide local connection
services over the "last mile" between transmissions from major service providers
to end user customers.

    Fiber Optic Cables

    The primary use of fiber optic cables is carrying high-volume communications
traffic from point to point. Satellite companies generally do not address this
market. Based on current trends, we expect that in the future, transcontinental
fiber optic cables will carry video signals and other video and audio
applications that use formats compatible with the Internet, although recent
business difficulties among fiber optic cable operators may affect fiber
build-out plans. Fiber optic cables are not, however, well suited for
point-to-multipoint broadcast applications, which we believe will increasingly
develop with the introduction of Internet applications, such as multicasting,
streaming and caching. Fiber optic cables are not readily usable for the
transmission of ad hoc events occurring at locations that are remote from a
fiber optic connection. Those sorts of events require the use of short-term
satellite capacity and transportable uplink ground stations.

                              Government Regulation

    The international communications environment is highly regulated. As an
operator of a private international satellite system based in the Netherlands,
we are subject to the regulatory authority of the government of the Netherlands
and the national communications authorities of the countries in which we
operate. We are also subject to regulations promulgated by the ITU.

    In order to provide services to, from, or within a country, we must comply
with that country's "market access" rules. This has required us, in some
instances, to obtain governmental permissions to provide transponder capacity
and other services to customers in those countries. We believe we will benefit
substantially from the pro-competitive trends informing national regulatory
policies. Under the Agreement on Basic Telecommunications Services, for example,
a number of countries that are members of the World Trade Organization committed
to open their markets to satellite operators established in other member
countries. Despite these trends, however, we will need to continue devoting
considerable time and resources to our market access efforts, and will have to
continue to comply with laws and regulations, including amended laws and
regulations, in the countries in which we provide service.

    We have assembled a team of regulatory professionals devoted almost
exclusively to market access issues. This team prioritizes its continuing
efforts by the magnitude of business opportunities in each market. Our fleet
provides services in the majority of the world's markets, and we believe that we
have obtained all necessary authorizations, permits and licenses for the conduct
of our business as whole.

Regulation in the Netherlands

    The Ministry of Economic Affairs, Directorate-General for Telecommunications
and Post (DGTP) is the governmental body in The Netherlands with primary
authority over satellite carriers. The primary source of regulation with respect
to telecommunications services providers is the Telecommunications Act. This act
requires operators to have a license to use frequencies within the territory of
the Netherlands. We are not required under Dutch law to have a license for the
use of frequencies in space, such as the operation of our satellites at the
specific orbital locations and upon the frequencies assigned to us, although we
have obtained an authorization from the Dutch government allowing us to use such
locations and frequencies. We are not required to have a license in the
Netherlands to operate a telecommunications network or services, although
registration is required with the Dutch independent telecommunications
regulatory agency. The Netherlands government is considering developing
additional laws regarding space activities to comply with its international
treaty obligations.

    The government of the Netherlands has registered our satellites with the
International Telecommunication Union. Accordingly, the government of the
Netherlands remains responsible internationally for resolving any allegations
that our satellites are causing harmful interference to other registered
wireless systems. Thus, although Dutch law provides no specific framework for
satellite licenses, we work closely with DGTP to ensure that we comply with ITU
regulations and any other obligations resulting from international
telecommunications agreements or treaties to which The Netherlands is a
signatory.

Other National Telecommunications Authorities

    Regulation in the United States

    Regulation of Satellite Use. The Federal Communications Commission (FCC) is
the governmental agency in the United States with primary authority over all
satellite operators that want to access that market. In the case of non-U.S.
licensed satellite operators, such as ourselves, the FCC does not generally
grant any licenses directly to the satellite operator. Instead, the FCC
regulates the ability of ground stations in the United States to communicate
with the satellites operated by the non-U.S. company. In March 2001, the FCC
granted our request for full authority to serve customers in the U.S. market.

    Export License Requirements. U.S. companies and companies located in the
United States must comply with U.S. export control laws in connection with their
provision to us of certain products, data, software, documentation and services
relating to our satellites and satellite-related terrestrial facilities. Since
we are a non-U.S. company, the exporter must obtain from the United States
government certain export licenses and other approvals, including new or amended
licenses with respect to each new satellite we may procure in the future from
the United States, and both we and the exporter must comply with the terms of
all such licenses and other approvals.

    Other Governmental Authorities

    In many of the other countries that our satellites can serve, we are subject
to national communications and/or broadcasting laws. While these laws vary from
country to country and are subject to periodic revision, national
telecommunications regulatory authorities generally have not required us to
obtain licenses or regulatory authorizations in order to provide transponder
capacity to authorized entities.

    Many countries have liberalized their national communications market. Many
countries allow authorized communications providers to own their own
transmission facilities and purchase satellite capacity without restriction. In
these environments, we may provide services through one or many authorized
carriers or to customers further down the distribution chain.

    Other countries, however, have maintained strict monopoly regimes or have
regulated the provision of services within their borders. In some cases, we must
establish a local legal entity or representative through which to do business,
and/or obtain specialized governmental licenses, concessions or permits. In
other countries, we must operate pursuant to a bilateral or multilateral
agreement permitting such operations. In other countries, some or all customers
may be required to access our services through one or a small number of
designated entities, which in some cases are government-owned. In order to
provide services in these environments, we may need to negotiate an operating
agreement with the designated entity(ies) that describes the types of services
offered by each party, the contractual terms for service and each party's rates.
Depending on the national regulatory requirements, these operating agreements
may require that customers obtain our services through the monopoly authority
alone at a pre-arranged markup or may allow customers to own and operate their
own facilities but require them to purchase our services through that entity at
a rate reflecting the pre-arranged markup.

    Notwithstanding the wide variety of regulatory regimes existing in the
countries where we currently provide service, we believe that we comply in all
material respects with applicable laws and regulations governing the conduct of
our business as whole.

International Telecommunication Union

    Under current international practice, satellite systems are entitled to
protection from harmful radio frequency interference from other satellite
systems and other transmitters in the same frequency band only if the
authorizing nation of the operator registers the orbital location, frequency and
use of the satellite system on the ITU's Master International Frequency
Register. Nations are required to register their proposed use of orbital
positions with the Radiocommunications Bureau of the International
Telecommunication Union. This ensures that there is an orderly process to
accommodate each country's orbital positions needs. After a nation has advised
the Radiocommunications Bureau that it desires to use a given frequency at a
given orbital position, other nations notify that nation of any use or intended
use that would conflict with the original proposal. These nations are then
obligated to negotiate with each other in an effort to coordinate the proposed
uses and resolve interference concerns. If the countries resolve all disputes,
the member governments are formally notified and the frequency use is
registered. Following that notification, the registered satellite networks are
entitled under international law to interference protection from subsequent or
nonconforming uses. A nation is not entitled to invoke the protections in the
ITU's rules against harmful interference if that nation decided to operate a
satellite at the relevant orbital location without completing the coordination
process.

    Under the ITU's rules, a country that places a satellite or any ground
station into operation without completing coordination and notification:

     o    would have to respond to complaints related to interference;

     o    would not be entitled to seek the assistance of the
          Radiocommunications Bureau in resolving complaints relating to
          interference;

     o    would be vulnerable to interference from other systems; and

     o    might have to alter the operating parameters of its satellite if the
          ITU found that the satellite caused harmful interference to other
          users already entered on the International Frequency Registry.

    The Radio Regulations Board, however, has no effective mechanism to resolve
disputes regarding coordination or to enforce its rules regarding the use of
frequencies and orbital locations.

    Because only nations have full standing as ITU members, we must rely on the
government of the Netherlands to represent our interests there, including filing
and coordinating our orbital positions with the ITU and with the national
administrations of other countries, obtaining new orbital positions, and
resolving disputes related to the ITU's rules and procedures.


C.  Organization Structure/List of Significant Subsidiaries

The significant subsidiaries of New Skies Satellites, N.V. as of December 31,
2002 were:
<TABLE>
<CAPTION>

Name                                            Location                       % ownership
----------------------------------------------- -----------------------------  -------------------
<S>                                             <C>                                   <C>
New Skies Networks, Inc.                        Delaware, U.S.A                       100%
New Skies Satellites, Inc.                      Delaware, U.S.A                       100%
New Skies Satellites Asset Holding, Inc.        Delaware, U.S.A                       100%
New Skies Networks Pty Ltd.                     New South Wales, Australia            100%
New Skies Networks (UK) Ltd.                    London, United Kingdom                100%
New Skies Satellites (UK) Ltd.                  London, United Kingdom                100%
New Skies Satellites MAR B.V.                   The Hague, The Netherlands            100%
New Skies Satellites Kazakhstan B.V.            The Hague, The Netherlands            100%
New Skies Satellites Singapore B.V.             The Hague, The Netherlands            100%
New Skies Satellites India B.V.                 The Hague, The Netherlands            100%
New Skies Satellites Brazil Ltda.               Sao Paulo, Brazil                     100%
</TABLE>


<PAGE>


ITEM 5.  OPERATING AND FINANCIAL REVIEW AND PROSPECTS

The following should be read together with Item 3 "Selected Consolidated
Historical Financial Data" and our consolidated financial statements and the
accompanying notes appearing elsewhere in this annual report. Our financial
statements are prepared in accordance with U.S. GAAP.

Overview

    We are a global satellite telecommunications company that owns and operates
six in-orbit satellites, and has one additional satellite under construction. We
provide satellite-based transponder capacity for the transmission of video
signals, data and telephone traffic, and Internet access services. We also offer
ground-based services in conjunction with our satellite capacity in order to
provide our customers with end-to-end communications services for certain
applications.

    Revenues

    In 2002 we had revenues of $200.5 million. We earn revenues by providing
transponder capacity, or a combination of transponder capacity and terrestrial
facilities and services, to customers to allow them to transmit and receive
signals using our satellites. We currently provide transponder capacity on both
fixed-term and occasional-use bases. We recognize revenues on a straight-line
basis over the period during which satellite services are provided.

                     Revenue diversity by service type: 2002

                                [GRAPHIC OMITTED]



    The chart above presents our estimate, based on our analysis of frequency
plans supplied by our customers, of the percentage of our total revenues in 2002
attributable to each of the three broad categories of content for which our
customers used our services.

    As the chart shows, our revenues are well balanced across these three
categories of demand. Video transmission represented our largest source of
revenues in 2002 followed by data and voice services. Internet connectivity and
other transmissions using Internet formats accounted for the remainder of our
revenues.

    Data and voice services have contributed a significant and growing portion
of our revenues, increasing from 20 percent of total revenues in 2000 to 32
percent in 2002. We expect continued demand for our data and voice services in
2003, driven in part by government requirements for these services and in part
by increasing requirements for international long-distance voice services from
newly authorized service providers in countries undergoing telephony
deregulation. These sources of demand have helped to counter-balance the general
trend toward the use of fiber optic networks for voice services, and we expect
that this segment will continue to contribute to our revenues over time
(although possibly at declining levels).

    Revenue Drivers

    The primary drivers of revenues in the satellite communications industry are
the supply of suitable capacity - i.e., capacity that is capable of providing
the desired communications links between two or more different points - and the
level of demand for that capacity.

    The supply of suitable capacity is driven by two principal factors:

     o    the availability of unused existing satellite capacity and the launch
          of new satellites serving the relevant region; and

     o    the availability of capacity offered by ground-based competitors that
          is suitable for serving a given communications requirement.

    Both we and our competitors build and launch new satellites to replace
existing satellites and to provide new geographic or frequency coverage. Because
the entry into service of any new satellite can add a significant amount of
capacity, the increase in supply can outstrip demand for some period following
launch. We try to mitigate this risk by working to sell the capacity of a new
satellite to customers before it is launched and by employing a business model
that makes reasonable assumptions about the speed with which we will be able to
sell capacity on a new satellite. More generally, we try to mitigate the risk of
over-supply of satellite capacity by designing our new satellites with better
performance characteristics and greater flexibility than other satellites. As
such, we design new satellites with flexibility to address different markets in
a dynamic manner as demand patterns shift, while focusing our new capacity on
regions and communications routes with high demand.

    We also try to mitigate the risk of over-supply of satellite capacity by
enhancing the attractiveness of our satellites to potential customers in other
ways, such as through the creation of a video distribution `neighborhood'. If a
satellite carries video content that is in high demand, then an increasing
number of ground-based receiving antennas will be dedicated to that particular
satellite to receive the popular video signal. If a high number of receiving
antennas are installed to receive the signal from the satellite, then the
satellite has created a `neighborhood' that is desirable to other broadcasters
of video content because a large number of their potential customers already
have antennas dedicated to that satellite. Accordingly, the remaining available
capacity on the satellite that can serve the neighborhood becomes more desirable
to the satellite operator's customers and prospective customers.

    As noted above, the second source of supply is ground-based competition,
such as fiber optic networks. Where ground-based networks exist, and when new
networks are brought into service, they typically are able to provide large
amounts of bandwidth at very low rates. Ground-based capacity and satellite
system capacity, however, are not perfect substitutes. The ability to provide
desirable communications links between different points (for example, between
various corporate offices or between a video programmer's production facility
and cable operators' local networks) is driven by the design of a satellite- or
ground-based network. Capacity can be used for transmissions only along the
particular communications routes or in the areas that the capacity connects. We
call the ability to provide transmission capacity between different places
`connectivity', and the desirability of a given connectivity drives the value of
that particular capacity. The connectivities of a satellite network are
determined principally by the geographic coverage of the satellites and the
frequencies in which they transmit signals. The connectivities of a ground-based
network are determined principally by the geographic route along which it
travels, such as a cable between New York and London. A ground-based network can
only transmit a signal along the route that it physically travels, which we call
`point-to-point' connectivity. A satellite network has the advantage of being
able to connect multiple points with a single transmission because satellites,
in essence, `blanket' an entire coverage area with their signal, which we call
`point-to-multi-point' or `broadcast' connectivity.

    We try to avoid competing with ground-based services by focusing on regions
where such ground-based services are not available, and on services
(particularly point-to-multi-point or broadcast services) where satellites have
a competitive advantage. In addition, we seek to provide services to customers
who desire a combination of ground-based and satellite services, for redundancy
or other reasons.

    Demand is principally driven by economic conditions, both generally and
within a particular geographic area or product/service market. Economic growth
fuels new demand for capacity as society seeks increasing access to news,
entertainment and other forms of media rich content. For example, in healthy
economic environments people may purchase more televisions or personal
computers. Increased television viewership raises demand for additional video
content provided by television broadcasters, who then need to purchase more
capacity to transmit their increased programming. Increased personal computer
use may increase demand for Internet services provided by local Internet Service
Providers, which similarly then need to purchase more capacity to transmit their
data packets. Demand for other applications, such as data and telephony services
or the establishment of private telecommunications networks used by businesses,
also is driven by general economic conditions, both globally and in specific
regions.

    Another key driver of demand for capacity is regulatory access to new
markets. As communications markets are liberalized, competition generally
increases, with two consequences. First, the new competitors desire capacity
upon which to establish their new networks. Second, competition tends to place
downward pressure on prices; as prices decline, a larger number of customers in
the newly liberalized markets are able to afford communications services.
Declining prices and increased competition, moreover, may encourage consumers to
demand improved access to and a broader selection of telecommunications and
video services. Demand also can be driven by events of a shorter-term nature,
such as major sporting events (for example, the Olympics or World Cup) or events
of a newsworthy nature.

    The continuation of past trends for growth, such as the growth of the
Internet and video programming offerings, are uncertain. In 2002 approximately
nine satellites were launched that could reasonably be expected to compete, at
varying levels, with our own satellites. We anticipate, on the basis of publicly
available information, that 17 such satellites could be launched by our
competitors in 2003. Certain of these satellites are replacement satellites,
although they may have incremental capacity. As satellites take roughly three
years to procure, build and launch, the satellites that were launched in 2002
and 2003 were, in all likelihood, contracted for a number of years ago. The
introduction of this new capacity, particularly in the current economic
environment and in light of existing capacity that remains available on some
pre-existing satellites, could place downward pressure on pricing and/or result
in a slower uptake on the capacity we are offering.

    In light of the fact that there is excess satellite capacity in many markets
today, a significant number of commercial satellite operators have announced
their intention to put their expansion plans on hold. Consistent with such
announcements, publicly available information indicates that only two commercial
satellite orders were placed in 2002.

    New Skies was created in 1998 and, at that time, was transferred five
operational satellites. From 1998 to 2002, our growth resulted from our ability
to sell the unused capacity on these satellites. During 2002, however, we
expanded our fleet by launching two new satellites and re-deploying a third.
NSS-7, launched in April 2002, replaced one satellite at the end of its life and
freed a second, NSS-5 (formally referred to as NSS-803) for re-deployment to the
Pacific Ocean Region. NSS-6, launched in December 2002, provides new capacity
for us to utilize in the Asia Pacific Region. We plan to launch another
satellite, NSS-8, in late 2004. NSS-8 will be used to replace an existing
satellite in the Indian Ocean Region, giving us both a newer, more competitive
satellite in that region and incremental capacity to be able to satisfy future
growth. NSS-7 became available for new services in late August 2002, after we
had completed the process of transitioning services onto it from the two
satellites it replaced. NSS-5 completed its drift to the Pacific Ocean Region in
mid-December, 2002, and NSS-6 entered commercial service in early 2003.

    Looking forward, we expect our revenues in 2003 and beyond to reflect the
addition of this new capacity. Together, these new satellites give us
approximately 67 percent more capacity to sell. We believe that our new
satellites are commercially attractive, given their relatively high power
levels, good connectivities, and flexibility that will allow us to allocate
capacity over time to areas in which demand exists.

    Our growth also relies in part on our ability to sell bundled services.
These services involve combining our transponder capacity with ground-based
services, such as transmission of signals from the earth to a satellite and
providing ground-based connections to the Internet. We believe that our ability
to provide those services will allow us to address a broader marketplace by
supplying services to customers further down the signal distribution chain. We
further believe, based on our experience with providing these services, that
this will provide us with an opportunity to capture incremental revenue that we
could not generate from the supply of satellite-based transponder capacity
alone. We provide bundled services using both our own facilities as well as
third-party facilities. In 2002, we entered into agreements with service
providers in Hong Kong, the Middle East, Singapore and the United States that
will expand the range of bundled services we are able to offer to our customers.

    Pricing also affects our revenues. Various market forces, which differ by
region, affect our pricing of transponder capacity. We sell our available
capacity at prevailing market prices, which vary with the connectivity and
neighborhood, the amount of capacity required, and the duration of the service
under contract. In general, we price contracts of shorter duration and for less
capacity on a higher cost-per-unit capacity basis than contracts of longer
duration and for more capacity. Prior to 1999, the majority of our contracts
were for video transmission, which generally had an average duration of five
years and were for capacities of 18 MHz or greater. Over the past several years,
we observed increased customer demand for services related to the transmission
of voice and data and Internet-related content, with capacity requirements of
typically 1-2 MHz and contract durations of three years or less. That said, the
majority of our revenues in 2002 continue to reflect contracts with average
duration of three years or greater. The average duration of our backlog as of
December 31, 2002 was approximately 6.7 years on a weighted average basis, and
approximately 2.5 years on a simple average basis. For new contracts concluded
during 2002, our average rates per transponder (expressed in 36-MHz units) were
approximately $1.5 million per year. These rates were 50 percent higher than the
per transponder rates we inherited from INTELSAT, but less than the approximate
$1.7 million average per transponder rate for similar contracts that we had
concluded in the years since our inception but prior to 2002. Based on our
analysis of market trends, we believe the decrease in average per-transponder
pricing is a result of difficult economic conditions during 2002, significant
competition from other operators, and incentives given to customers to commence
services on one of our newest satellites, NSS-7.

    We continue to market and sell long-term contracts in order to provide
greater stability and certainty regarding our revenues going forward. During
2002, we succeeded in increasing our customers' contractual service commitments,
or backlog, from $631 million at December 31, 2001 to $706 million at December
31, 2002. (See "- Backlog"). Among the market segments that we serve, video and
data customers tend to enter into multi-year contracts, while Internet customers
tend to prefer shorter-term contracts. We anticipate that, consistent with our
prior experience, a number of our Internet customers will renew their
commitments and increase the amount of our capacity they use as their businesses
grow, although some Internet and other customers may not renew contracts for
various reasons.

    We derive our revenues from customers spread around the globe. The chart
above sets forth the geographic source of our revenues in 2002, based on the
sales region. Many of our customers purchase capacity to provide services
outside of their home country. As a result, this distribution may not reflect
actual traffic flow on our satellites.

    We believe, based on our analysis of market trends, that we will continue to
see revenue growth from all regions as we sell capacity on our newest satellites
launched in 2002, NSS-6 and NSS-7, as well as the NSS-5 satellite which we
relocated to the Pacific Ocean Region during 2002. While we will continue to
market our services in all geographic markets, we expect that revenues from
customers in Asia Pacific, India, the Middle East and Africa will form a greater
proportion of our revenue mix in the future, due to the arrival of incremental
capacity in these regions from NSS-5 and NSS-6 and, ultimately, NSS-8.

    Expenses

    Our ongoing operating expenses include our cost of operations, selling,
general and administrative expenses and depreciation. Our cost of operations
includes costs associated with:

     o    tracking, telemetry, control and payload management operations for our
          satellites;

     o    fiber optic and teleport services associated with the provision of
          bundled services;

     o    in-orbit insurance for our satellites; and

     o    the costs associated with our own operations and engineering
          infrastructure.

Selling, general and administrative expenses include costs associated with:

     o    our sales and marketing and administrative staff;

     o    travel, office and occupancy costs; and

     o    other related expenses.

Depreciation includes the costs associated with the depreciation of capital
items, principally our satellites.

    In 2000, we began to perform our own payload management operations for all
of our satellites, and during 2001 we successfully assumed operational control
for the NSS-5, NSS-703 and NSS-806 satellites, activities previously performed
by INTELSAT. We are currently fully monitoring and operating these satellites
using our own tracking, telemetry and control facilities, and our ongoing net
savings achieved from bringing these activities in-house are reflected in the
results of operations in 2002. We also perform tracking, telemetry, control and
monitoring services for our newest satellites, NSS-7 and NSS-6, and expect to
perform these services for NSS-8 once it has been delivered to us in-orbit.

    As discussed in the previous section, we believe that by providing bundled
services we can capture incremental revenue that we could not generate from the
supply of satellite-based transponder capacity alone. Additionally, offering
bundled services allows us to seek new customers and gain access to developing
markets. In order to provide bundled services, however, we incur the costs of
operating our owned teleports and generally must incur additional third-party
ground infrastructure costs. In 2002, we noted an incremental rise in ground
infrastructure costs. To a significant extent, however, the third-party costs
are correlated with actual services and can be scaled to reflect actual sales
success.

    We believe that we have achieved a critical mass with respect to our
operations and staff, with the result that we do not anticipate significant
increases in these expenses in the near term except for effects of insurance
markets and related impact on in-orbit insurance, and from additional
third-party costs as we provide incremental bundled services to our customers,
as mentioned above. To the extent that our operations and sales infrastructure
is in place, we consider this aspect of our business to represent a largely
fixed cost.

    Depreciation is our single largest expense. Because we depreciate our
satellites on a straight-line basis over their anticipated useful lives,
depreciation expense is generally constant from year to year unless we launch a
satellite or a satellite reaches the end of its depreciable life. Depreciation
of a satellite starts when it enters operational service, which begins upon
successful completion of in-orbit testing. In 2002, we placed one new satellite,
NSS-7, into service and took one existing (although fully depreciated) satellite
out of service. This resulted in a significant net increase in depreciation
expense beginning in second half 2002. We launched our NSS-6 satellite in
December 2002, which became operational in the first quarter 2003. Consequently,
depreciation expense will increase substantially in 2003 as a result of the
full-year effect of the NSS-7 depreciation and the partial year effect of the
NSS-6 depreciation. We are constructing one additional satellite, NSS-8, which
is planned for launch in late 2004. This new satellite will involve significant
capital expenditures and will further increase depreciation charges once it is
placed into service. As we add new satellites to our fleet, we will also incur
additional costs for launch insurance and in-orbit insurance.

Backlog

    We provide customers with satellite transponder capacity for contract
periods varying from less than one year to 15 years. At December 31, 2002, we
had a contractual backlog for future services of approximately $706 million. Of
this amount, which we do not recognize as revenue until we actually perform the
services, approximately $601 million, or 85 percent, relates to obligations
provided under non-cancelable agreements. The remaining backlog relates to
preemptible capacity contracts that have cancellation options, subject to the
payment of early termination penalties. We cannot rule out the possibility we
could face contract terminations arising in the normal course of business or as
a result of other market forces.

    As of December 31, 2002, the average remaining duration of our contracted
backlog, based on a simple average of our order book, was approximately 2.2
years. On a weighted average basis, the average remaining duration of our
contracts was approximately 6.7 years.

Results of Operations

    Table 1 sets forth, for the periods indicated, certain items in the
consolidated statements of operations, reflected as a percentage of revenues.

       Table 1 - Statement of operations data as a percentage of revenues


<TABLE>
<CAPTION>

                                                                  Year Ended December 31,
                                                         2002          2001              2000
                                                         ----          ----              ----
Statement of operations data:
<S>                                                      <C>           <C>               <C>
Revenues.............................................    100%          100%              100%
Operating expenses:
  Cost of operations.................................     25            25                24
  Selling, general and administrative................     20            18                18
  Depreciation and amortization......................     40            36                35
Total operating expenses.............................     85            79                77
Operating income.....................................     15            21                23
Income before cumulative effect of change in               9            16                16
   accounting principle.............................
Cumulative effect of change in accounting
   principle........................................     (11)           -                 -
Net (loss) income...................................      (2)           16                16
</TABLE>


    Year ended December 31, 2002 compared to year ended December 31, 2001

    Revenues. Our revenues for the year ended December 31, 2002 were $200.5
million, a decrease of $8.5 million, or 4 percent, from $209.0 million for the
year ended December 31, 2001. The decrease for the year is principally the
result of the prevailing difficult market conditions, as well as the
unavailability of some of our capacity for service during the transition of
traffic from the NSS-K and NSS-5 satellites to NSS-7, which went into commercial
service in August 2002, and the subsequent migration of NSS-5 to the Pacific
Ocean Region, completed in December 2002.

    Our station-kept satellite fleet fill rate for satellites available for
service at December 31, 2002 was 67 percent as compared to 65 percent at
December 31, 2001. Fill rate is defined as the number of our revenue-generating
transponders (expressed in 36-MHz units) divided by our fleet-wide station-kept
transponder capacity available for service (expressed in 36-MHz units). Average
rate per transponder for contracts concluded in 2002 was approximately $1.5
million per year, down $0.2 million as compared to 2001, reflecting difficult
market conditions as well as incentives given to customers to commence services
on NSS-7.

    Cost of operations. Our cost of operations decreased $0.8 million, or 2
percent, to $50.7 million for the year ended December 31, 2002 compared to $51.5
million for the year ended December 31, 2001. As a percentage of revenues, our
cost of operations remained unchanged at 25 percent. In absolute terms, the net
decrease in our cost of operations reflects our success in managing our
discretionary costs and from bringing our tracking, telemetry, control and
payload management operations in-house.

    Selling, general and administrative. Our selling, general and administrative
expenses increased by $0.8 million, or 2 percent, to $39.5 million in the year
ended December 31, 2002 from $38.7 million for the year ended December 31, 2001.
This slight net increase resulted primarily from the expansion of the sales and
marketing staff that we undertook in order to better exploit the capacity on our
new satellites primarily offset by savings arising from careful management of
our discretionary costs.

    Earnings before interest, taxes, depreciation and amortization (EBITDA)
(adjusted). Our EBITDA (adjusted) for the year ended December 31, 2002 was
$110.3 million, a decrease of $8.5 million, or 7 percent, from $118.8 million in
2001. The decrease in EBITDA (adjusted) is attributable to decreased revenues in
2002. In 2002, we calculated EBITDA (adjusted) to exclude the cumulative
effect of change in accounting principle relating to goodwill of $23.4 million.
See footnote 7 to our " - Selected Consolidated Historical Financial Data".

    As a percentage of revenues, EBITDA (adjusted) decreased to 55 percent for
the year ended December 31, 2002 from 57 percent for the year ended December 31,
2001We believe that earnings before interest, taxes, depreciation and
amortization is a measure of performance used by some investors, equity analysts
and others to make informed investment decisions. EBITDA is not presented as an
alternative measure of operating results or cash flow from operations, as
determined in accordance with generally accepted accounting principles in the
U.S. EBITDA as presented herein may not be comparable to similarly titled
measures reported by other companies. (See Table 2 "- Reconciliation of EBITDA
(adjusted) to net (loss) income").

             Table 2 - Reconciliation of EBITDA (adjusted) to net (loss) income

<TABLE>
<CAPTION>

(in thousands of U.S. dollars)                             2002             2001              2000
                                                       --------------  ---------------   ---------------
<S>                                                    <C>             <C>                 <C>
Net (loss) income                                      $   (4,645)     $     33,068        $   31,674
Cumulative effect of change in accounting principle         23,375             -                 -
Income tax expense                                          10,506           19,364            17,506
Interest expense (income) and other, net                       510          (9,008)           (2,543)
Depreciation and amortization                               80,574           75,338            69,870
                                                       --------------  ---------------   ---------------
Earnings before interest, taxes, depreciation
   and amortization (EBITDA) (adjusted)                $   110,320     $    118,762      $    116,507
                                                       ==============  ===============   ===============
</TABLE>


    Depreciation and amortization. Our depreciation and amortization expense
increased $5.3 million, or 7 percent, to $80.6 million for the year ended
December 31, 2002 from $75.3 million for 2001. This increase was primarily due
to commencement of service of NSS-7, successfully launched in April 2002, net of
elimination of goodwill amortization of $2.8 million in 2001.

    Effective January 1, 2002, we adopted Statement of Financial Accounting
Standards No. 142, ("SFAS No. 142") Goodwill and Other Intangible Assets, and in
accordance with the standard stopped amortizing goodwill that resulted from
business combinations completed prior to the adoption of SFAS No. 141. (See "-
Recently Issued Accounting Standards").

    Interest expense (income) and other, net. Net interest expense for the year
ended December 31, 2002 was $0.5 million, a decrease of $9.5 million, compared
to net interest income of $9.0 million for the year ended December 31, 2001. The
decrease primarily arises from lower interest income in 2002, as we fully
utilized the remaining funds raised through our initial public offering to fund
the ongoing construction of our new satellites, NSS-7, NSS-6 and NSS-8. (See "-
Liquidity").

    Income tax expense. Our income tax expense decreased $8.9 million, or 46
percent, to $10.5 million for the year ended December 31, 2002, from $19.4
million in 2001. The decrease was due primarily to the decrease in our pre-tax
income.

    Cumulative effect of change in accounting principle, relating to goodwill,
net of taxes. As of January 1, 2002, we adopted SFAS No. 142. (See "-Recently
Issued Accounting Standards"). This Standard eliminates goodwill amortization
from the consolidated statement of operations and requires an evaluation of
goodwill for impairment upon adoption of this Standard, as well as subsequent
evaluations on an annual basis, and more frequently if circumstances indicate a
possible impairment.

    Upon adoption of SFAS No. 142, we performed a transitional impairment test
on the goodwill resulting from the purchase of New Skies Networks Pty Limited in
March 2000. As a result of this impairment test, we recorded an impairment
charge of $23.4 million, which is classified as a cumulative effect of a change
in accounting principle.

    Year Ended December 31, 2001 Compared to Year Ended December 31, 2000

    Revenues. Our revenues increased by $10.7 million, or 5 percent, to $209.0
million in the year ended December 31, 2001 from $198.3 million in the year
ended December 31, 2000. Our 2000 revenues included the positive impact of a
$19.7 million exceptional one-time contract termination payment made by one
customer. Excluding this one-time payment recorded in 2000, our 2001 revenues
increased 17 percent from $178.6 million in 2000. The increase in revenues was
attributable to the success in increasing the fleet-wide average yield per
transponder and in increasing the fill rate of our station-kept satellite fleet
to 65 percent at December 31, 2001 from a 63 percent fill rate at December 31,
2000. The increase in the fleet-wide average yield per transponder was a result
of our market-based pricing strategy as compared to the pricing we inherited at
the time we commenced independent commercial operations, our willingness to
enter into contracts for smaller units of capacity and for shorter duration, and
our ability to offer value-added services.

    Cost of operations. Our cost of operations increased $4.5 million, or 10
percent, to $51.5 million for the year ended December 31, 2001 compared to $47.0
million for the year ended December 31, 2000. As a percentage of revenue, our
cost of operations remained relatively unchanged at 25 percent for the year
ended December 31, 2001 compared to 24 percent for the year ended December 31,
2000. Excluding the net impact of a one-time exceptional payment to us that was
recorded in the third quarter 2000, cost of operations as a percentage of
revenues was 26 percent in 2000. In absolute terms, the net increase in our cost
of operations of $4.5 million related to the continued development of the
engineering and operational worldwide infrastructure, including the development
of our terrestrial infrastructure.

    Selling, general and administrative. Our selling, general and administrative
expenses increased $3.9 million, or 11 percent, to $38.7 million in the year
ended December 31, 2001 from $34.8 million in the year ended December 31, 2000.
This increase resulted primarily from the full year effect of our continuing
expansion of our sales, marketing and support staff required to fully exploit
the unused capacity of our existing satellites. We employed 261 full-time
employees as of December 31, 2001 compared to 219 full-time employees as of
December 31, 2000.

    Earnings before interest, taxes, depreciation and amortization (EBITDA). Our
EBITDA increased by $2.3 million, or 2 percent, to $118.8 million for the year
ended December 31, 2001 from $116.5 million in 2000. Excluding the $19.7 million
one-time exceptional contract termination payment received in the third quarter
2000, EBITDA increased by $22.0 million, or 23 percent. The increase in EBITDA
was largely attributable to increased revenues in 2001 offset in part by the
planned expansion of marketing and support staff and overall build up of the
corporate and terrestrial infrastructure required to fully exploit the
unutilized capacity of our existing satellites.

    As a percentage of revenues, EBITDA decreased to 57 percent for the year
ended December 31, 2001 from 59 percent for the year ended December 31, 2000.
Excluding the one-time termination payment, EBITDA as a percentage of revenues
improved 3 percent from 54 percent. We believe that earnings before interest,
taxes, depreciation and amortization is a measure of performance used by some
investors, equity analysts and others to make informed investment decisions.
EBITDA is not presented as an alternative measure of operating results or cash
flow from operations, as determined in accordance with generally accepted
accounting principles in the U.S. EBITDA as presented herein may not be
comparable to similarly titled measures reported by other companies. (See Table
2 "- Reconciliation of EBITDA (adjusted) to net (loss) income").

    Depreciation and amortization. Our depreciation and amortization expense
increased $5.4 million, or 8 percent, to $75.3 million for the year ended
December 31, 2001 from $69.9 million for 2000. This increase was due to the
increase in the depreciable assets as a result of the completion of the
construction of our satellite operations center in The Hague and our Washington
D.C. mediaport and the full year effect of amortization of goodwill relating to
the acquisition of New Skies Networks Pty Ltd. on March 31, 2000.

    Interest expense (income) and other, net. Net interest income increased $6.5
million, or 254 percent, to $9.0 million for the year ended December 31, 2001
from net interest income of $2.5 million in 2000. The increase in the overall
interest income was primarily due to the investment of unexpended proceeds
arising from our initial public offering completed in October 2000 and
reimbursement of $1.8 million of KTV project management costs as a part of an
arbitration judgement.

    Income tax expense. Our income tax expense increased $1.9 million, or 11
percent, to $19.4 million for the year ended December 31, 2001, from $17.5
million in 2000. The increase was due primarily to the increase in our taxable
income.

Liquidity and Capital Resources

    Our liquidity requirements arise principally from the need to:

     o    fund capital expenditures for the construction and launch of new
          satellites;

     o    fund working capital requirements;

     o    expand our business organically; and

     o    finance any acquisitions we may make.

    Liquidity

    As of December 31, 2002, our principal sources of funds were cash flows from
operating activities and amounts available under a $300 million unsecured
revolving credit facility. At December 31, 2002, we had drawn down $10 million
on our $300 million credit facility, with $290 million remaining available. Net
cash provided by operating activities totaled $112.0 million in 2002, $130.7
million in 2001 and $117.9 million in 2000. We had cash and cash equivalents of
approximately $8.3 million as of December 31, 2002.

    We intend to use our $300 million facility for capital expenditures,
acquisitions and general corporate purposes. We currently can borrow up to $290
million under this facility, although this maximum amount will be reduced to
$200 million on December 31, 2003 and further reduced to $100 million on June
30, 2004. The facility must be repaid in full by December 31, 2004. The interest
rate on borrowings will vary with LIBOR or EURIBOR and the applicable margin,
which will vary with the amount of our indebtedness as a proportion of our
EBITDA. The facility also contains customary events of default and financial
covenants that relate to our business and regulations that affect us.

    In November 2002, we launched a share buyback initiative to repurchase a
total of 13 million shares as a way to provide additional liquidity to our
shareholders. As of December 31, 2002, 5,194,030 shares had been repurchased at
a cost of $19.3 million. The acquired shares are recorded as `Treasury Stock' as
a reduction of Shareholders' Equity.

    As our business is generally not seasonal, we have little need for
short-term borrowings to finance normal operations.

    As of December 31, 2002, we had approximately $39.1 million of trade
receivables outstanding. Pursuant to its policy, INTELSAT sold capacity with
credit terms that included making payments in arrears. Approximately 52 percent
of trade receivables at the end of 2002 reflect credit terms monthly or
quarterly in arrears. New service agreements generally require payment monthly
in advance.

    Our cost of satellite construction includes an element of deferred
consideration to the satellite manufacturers called `satellite performance
incentives'. We are contractually obligated to make these payments, representing
up to 8 percent of the overall contract price of our existing satellites, over
the minimum, contractually obligated, orbital design lives of the satellites so
long as those satellites continue to meet contractual specifications. We
capitalize the present value of these payments as part of the cost of
constructing these satellites and record a corresponding liability to the
satellite manufacturers. This obligation is then reduced as the satellite
performance incentive payments are made.

    We believe that our cash flows from operations, our cash and cash
equivalents and funds available under our $300 million credit facility will
provide us with sufficient liquidity to meet our currently anticipated future
financial obligations, committed capital expenditures and other needs through
the end of 2003. Nevertheless, we plan to carefully evaluate opportunities to
expand our operations. If capital investments exceed expected levels, we may
seek additional financing.

    Capital expenditures and investments

    Cash used in investing activities, primarily representing capital
expenditures for satellite construction, launch contracts, launch insurance and
other property, was mainly funded using cash flow from operations and, to the
extent necessary, borrowings under our credit facility. Net payments for
investing activities totaled $231.4 million in 2002, $222.7 million in 2001 and
$148.9 million in 2000. We signed a contract for a new satellite, NSS-7, with
Lockheed Martin in 1999, which was launched in April 2002. We signed a contract
for another satellite, NSS-6, with Lockheed Martin in 2000, which was launched
in December 2002. We also signed a contract for a third satellite, NSS-8, with
Boeing Satellite Systems in March 2001. We recently amended that contract,
reconfiguring the satellite for deployment for service in an established orbital
location in the Indian Ocean Region. We anticipate that NSS-8 will enter
commercial service in the first half of 2005.

    We currently anticipate that our capital expenditures for 2003 will be
approximately $65 to $85 million, to be financed with a combination of
borrowings under our $300 million facility and operating cash flow. We expect
that these expenditures will consist primarily of:

     o    payments with respect to the final acceptance of the NSS-6 satellite
          and construction and launch contract for NSS-8;

     o    payments made to acquire and upgrade ground station facilities; and

     o    costs associated with the expansions of our operations.

    As part of our operational and strategic plan, we plan to launch replacement
satellites when existing satellites near the end of their commercial lives. We
will also explore the possibility of adding additional satellites to our fleet
and will evaluate strategic opportunities such as joint ventures and
acquisitions. We regularly study the demand for satellite services in various
regions and for different applications in order to keep abreast of
opportunities. While we are committed to a long- term strategy of enhancing our
satellite fleet, we will enter into procurement contracts for new satellites
only where we have a demonstrated need for the additional capacity and a sound
business case for the particular satellite.

    Table 3 below summarizes our contractual obligations and commercial
commitments as of December 31, 2002.

                        Table 3 - Contractual obligations




<TABLE>
<CAPTION>

 (in thousands of U.S. dollars)                                      Payments due by period
                                        --------------------------------------------------------------------------
                                            Total       Less than 1     1-3 years      4-5 years    After 5 years
                                                           year
                                        -------------- -------------- -------------- -------------- --------------
<S>                                      <C>              <C>           <C>             <C>            <C>
Short-term debt                            $10,000       $ 10,000          $   -           $  -          $   -
Long-term debt                                   -              -              -              -              -
Capital lease obligations                        -              -              -              -              -
Operating leases                             6,088          1,395          2,008            961          1,724
Unconditional purchase obligations          27,377         13,643         10,149          2,014          1,571
Conditional purchase obligations
   (In-progress satellite procurement       86,196         43,988         42,208              -              -
   programs)
Conditional payment obligations
   (In-orbit satellite performance          40,517          5,756         11,538          7,673         15,550
   incentives)
Contingent conditional payment
   obligations (In-progress satellite       39,952          1,672          6,659          6,659         24,962
   performance incentives)
                                        -------------- -------------- -------------- -------------- --------------
TOTAL                                    $ 210,130        $ 76,454      $ 72,562        $17,307        $43,807
                                        ============== ============== ============== ============== ==============
</TABLE>

Taxation

    We are currently in discussions with the Dutch tax authorities to determine
the tax basis of the assets contributed to us by our predecessor. While we have
not agreed to the final determination of the tax basis of these assets with
those authorities, we have made a preliminary valuation of these assets. The
difference between the book value of the assets on November 30, 1998 and the
estimated initial tax basis of the assets of $750 million gave rise to a
deferred tax asset, which approximated $15.6 million at December 1, 1998. We
believe that it is more likely than not that the results of future operations
will generate sufficient taxable income to realize this deferred tax asset.
Application of the deferred tax asset will reduce our annual tax payments by
approximately $1.3 million per year for approximately the next 12 years, based
on the average lives of our current satellites. Should the tax authorities agree
to a different initial valuation of the assets as of November 30, 1998, then
34.5 percent of the difference between that amount and $750 million would be
adjusted to this deferred tax asset provided that recovery is more likely than
not.

    Certain countries within which we operate have sought to impose withholding
taxes or income taxes on payments from customers in those countries,
notwithstanding the existence of tax treaties that do not permit the imposition
of such taxes. We use available legal means to contest such taxation and in
addition, in many but not all such cases, we also have the right under contracts
to pass such taxes on to our customers or to other third parties.

Currency and exchange rates

    All of our major capital expenditures and substantially all of our revenues
and operating expenses are denominated in U.S. dollars. Accordingly, we have
adopted the U.S. dollar as our functional currency. Transactions in other
currencies are translated into U.S. dollars using the rates that were in effect
at the transaction date. Since all of our major inflows and outflows are
denominated in U.S. dollars, we are not exposed to significant foreign currency
exchange risk.

Disclosures about market risk

    We are exposed to market risks relating to interest rate changes from time
to time. To the extent that we make significant borrowings under our $300
million facility, we will evaluate the appropriateness of using various hedging
instruments. We do not enter into derivatives or other financial instruments for
trading, hedging foreign currency exposure or speculative purposes.

Critical Accounting Policies

Our significant accounting policies are described fully in Note 2 to our
consolidated financial statements appearing elsewhere in this annual report. We
consider a number of accounting policies to be critical to the understanding of
our results of operations. These accounting policies relate to revenue
recognition, our communications, plant and other property, impairment of
long-lived assets, income taxes, goodwill and satellite performance incentives.
Our preparation of financial statements in accordance with accounting principles
generally accepted in the United States requires us to make estimates and
assumptions that affect the reported amount of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements, and the reported amounts of revenue and expenses during the
reporting period. Actual results could differ from those estimates.

Revenue recognition

Telecommunications revenue results from utilization charges that are recognized
as revenue on a straight-line basis over the period during which the satellite
services are provided. This revenue is recognized provided that collection of
the related receivable is probable. We make estimates regarding the probability
of collection based upon an evaluation of the customer's creditworthiness, the
customer's payment history and other conditions or circumstances that may affect
the likelihood of payment. When we have determined that the collection of
payments for satellite utilization is not probable at the time the service is
provided, we defer recognition of the revenue until such time that collection is
believed to be probable or the payment is received. We also maintain an
allowance for doubtful accounts for customers' receivables where the collection
of these receivables is uncertain. If our estimate of the probability of
collection is not accurate, we may experience lower revenue or an increase in
our bad debt expense.

We receive payments for satellite utilization charges from some customers in
advance of our providing services. Amounts received from customers pursuant to
satellite capacity prepayment options are recorded in the financial statements
as deferred revenue. These deferred amounts are recognized as revenue on a
straight-line basis over the agreement terms.

Communications, plant and other property

Communications, plant and other property are carried at cost and consist
primarily of the costs of spacecraft construction and launch, including
capitalized performance payments, insurance premiums, capitalized interest, and
costs directly associated with monitoring and support of spacecraft
construction. Satellite construction and launch services costs are capitalized
to reflect progress toward completion, which typically coincides with contract
milestone payment schedules. Insurance premiums related to satellite launches
are capitalized and amortized over the lives of the related satellites.
Insurance policies procured for in-orbit operations are expensed as incurred.
Performance incentives payable in future periods are dependent on the continued
satisfactory performance of the satellites in service.

Communications, plant and other property are depreciated and amortized on a
straight-line basis over their estimated useful lives. The depreciable lives of
our satellites range from 7 years to 13 years. We make estimates of the useful
lives of our satellites for depreciation purposes based upon an analysis of each
satellite's performance, including its orbital design life and its estimated
orbital maneuver life. The orbital design life of a satellite is the length of
time that the satellite's hardware is guaranteed by the manufacturer to remain
operational under normal operating conditions. In contrast, a satellite's
orbital maneuver life is the length of time the satellite is expected to remain
operational as determined by remaining fuel levels and consumption rates.

Impairment of long-lived assets

We periodically review our long-lived assets, which are comprised primarily of
our in-service satellite fleet, to determine whether an impairment exists.
Impairment can arise from complete failure or partial failure of the satellites
as well as a change in expected cash flows. Such impairment tests are based on a
comparison of estimated undiscounted future cash flows to the recorded value of
the asset. If impairment is indicated, the asset value will be written down to
fair value based upon discounted cash flows, using an appropriate discount rate.



Income taxes

We account for income taxes under the provisions of Statement of Financial
Accounting Standards ("SFAS") No. 109, Accounting for Income Taxes. Under this
method, deferred tax assets and liabilities are recognized for the future tax
consequences of temporary differences between the carrying amounts and tax bases
of assets and liabilities and net operating loss carry-forwards using enacted
rates. Valuation allowances are provided against assets that are not likely to
be realized.

We are currently in negotiations with the Dutch tax authorities to determine the
fair value (tax basis) of the assets contributed by our predecessor. While the
final determination of the tax basis of these assets has not been agreed, we
have made a preliminary valuation of these assets. The difference between the
book and estimated tax bases of the contributed assets gives rise to a deferred
tax asset, which approximated $15.6 million at December 1, 1998, the date of the
Asset Transfer. To the extent that the final tax value of the contributed assets
differs from this estimate, a corresponding adjustment will be made to the
deferred tax asset and additional paid-in capital.

Goodwill

The excess of the purchase price over the fair market value of net assets
acquired is recorded as goodwill and is tested for impairment at least on an
annual basis. As of January 1, 2002, we adopted SFAS No. 142, Goodwill and Other
Intangible Assets. This Statement eliminates goodwill amortization from the
Consolidated Statement of Operations and requires an evaluation of goodwill for
impairment upon adoption of this Statement, as well as subsequent evaluations on
an annual basis, and more frequently if circumstances indicate a possible
impairment. Upon adoption of SFAS No. 142, we performed a transitional
impairment test on the goodwill resulting from the purchase of New Skies
Networks Pty Limited. As a result of this impairment test, we recorded an
impairment charge of $23.4 million, which is classified as a cumulative effect
of a change in accounting principle

Satellite performance incentives

Our cost of satellite construction includes an element of deferred consideration
to satellite manufacturers referred to as satellite performance incentives. We
are contractually obligated to make these payments, representing up to 8 percent
of the overall contract price of our existing satellites, over the minimum,
contractually obligated, orbital design lives of the satellites, provided the
satellites continue to operate in accordance with contractual specifications.

Dutch GAAP reconciliation matters

    Our financial statements are prepared in accordance with accounting
principles generally accepted in the United States of America and do not differ
in any material respect from those which would have been prepared if we had used
accounting principles generally accepted in The Netherlands other than the
accounting for goodwill. Under Dutch GAAP goodwill continues to be amortized.
However, given that New Skies Networks Pty Limited was impaired both under US
GAAP and Dutch GAAP, our result for 2002 was the same under both accounting
methods. Under Dutch law, we prepare annual financial statements in accordance
with Dutch accounting principles and file those statements with the Trade
Register of the Chamber of Commerce and Industry in The Hague. These accounts
are available for inspection at our executive offices.

Recently issued accounting standards

    In June 2001, the Financial Accounting Standards Board (FASB) issued SFAS
No.143, Accounting for Asset Retirement Obligations. SFAS No. 143 establishes
accounting standards for the recognition and measurement of legal obligations
associated with the retirement of tangible long-lived assets and requires
recognition of a liability for an asset retirement obligation in the period in
which it is incurred. The provisions of this statement are effective for
financial statements issued for fiscal years beginning after June 15, 2002. On
January 1, 2003, we adopted SFAS No.143 which did not have a material impact on
our consolidated financial statements.

    As of January 1, 2002 we adopted SFAS No. 144, Accounting for the Impairment
or Disposal of Long-Lived Assets. This statement defines the accounting and
reporting for the impairment and disposal of long-lived assets and is effective
on January 1, 2002. Adopting SFAS No.144 did not have a material impact on our
consolidated financial statements.

    As of January 1, 2002, we adopted SFAS No.145, Rescission of SFAS No. 4, 44,
64, Amendment of SFAS No. 13, and Technical Corrections. SFAS No. 4, which was
amended by SFAS No. 64, required all gains and losses from the extinguishment of
debt to be aggregated and, if material, classified as an extraordinary item, net
of related income tax effect. As a result, the criteria in Opinion 30 will now
be used to classify those gains and losses. The provisions of this statement are
effective for financial statements issued for fiscal years beginning after
December 15, 2002. The adoption of SFAS No.145 did not have a material impact on
our consolidated financial statements.

    As of January 1, 2002, we adopted SFAS No.142, Goodwill and Other Intangible
Assets. This Standard eliminates goodwill amortization from the Consolidated
Statement of Operations and requires an evaluation of goodwill for impairment
upon adoption of this Standard, as well as subsequent evaluations on an annual
basis, and more frequently if circumstances indicate a possible impairment. Upon
adoption of SFAS No. 142, we performed a transitional impairment test on the
goodwill resulting from the purchase of New Skies Networks Pty Limited. As a
result of this impairment test, an impairment charge of $23.4 million was
recorded, which is classified as a cumulative effect of a change in accounting
principle. Changes in the carrying amount of goodwill are reflected in Table 4.


              Table 4 - Changes in the carrying amount of goodwill

       (in thousands of U.S. dollars)

       Balance at December 31, 2000               $            26,135
       Amortization                                            (2,760)
                                                  ---------------------

       Balance at December 31, 2001                            23,375
       Impairment loss                                        (23,375)
                                                  ---------------------

       Balance at December 31, 2002               $                -
                                                  =====================


    The reconciliation of reported net (loss) income and earnings per share to
net (loss) income and earnings per share for the years ended December 31, 2002,
2001 and 2000, adjusted to eliminate the effect of goodwill amortization in 2001
and 2000, is reflected in Table 5.

<TABLE>
<CAPTION>



             Table 5 - Net (loss) income and earnings per share as adjusted for goodwill amortization

(in thousands of U.S. dollars, except per share          2002                2001               2000
amounts)
                                                   ------------------   ----------------  -----------------
<S>                                                <C>                  <C>               <C>
Net (loss) income, as reported                     $        (4,645)     $       33,068    $        31,674
Add: Goodwill amortization                                       -               2,760              1,494
                                                   ------------------   ----------------  -----------------
Adjusted net (loss) income                         $        (4,645)     $       35,828    $        33,168
                                                   ==================   ================  =================


Basic and diluted earnings per share, as reported  $         (0.04)     $         0.25    $          0.29
Add: Goodwill amortization                                       -                0.02               0.02
                                                   ------------------   ----------------  -----------------
Adjusted basic and diluted earnings per share      $         (0.04)     $         0.27    $          0.31
                                                   ==================   ================  =================
</TABLE>


    Upon adoption of SFAS No.142, the transition provisions of SFAS No. 141,
Business Combinations, also became effective. These transition provisions
specify criteria for determining whether an acquired intangible asset should be
recognized separately from goodwill. Adopting SFAS No.141 did not have a
material impact on our consolidated financial statements.

    In June 2002, the FASB issued SFAS No. 146, Accounting for Costs Associated
with Exit or Disposal Activities. This statement defines the accounting and
reporting for costs associated with exit or disposal activities and is effective
for exit or disposal activities that are initiated after December 31, 2002. We
do not anticipate that the adoption of SFAS No. 146 will have a material impact
on our consolidated financial statements.

    In December 2002, the FASB issued SFAS No. 148, Accounting for Stock-Based
Compensation - Transition and Disclosure. SFAS No. 148 establishes accounting
standards for the transition from accounting for stock-based compensation to
employees under the intrinsic value method under APB No. 25, Accounting for
Stock Issued to Employees to the fair value based method as defined by SFAS No.
123, Accounting for Stock-Based Compensation. The statement provides three
alternatives of transition: a prospective method, a modified prospective method,
and a retroactive restatement method. We adopted the fair value method as of
January 2003 and will transition using the prospective method provided by SFAS
No. 148. Under the prospective method, we will apply the fair-value based method
of accounting for stock options, recognizing expense for awards granted after
January 1, 2003.

    In November 2002, the FASB issued Interpretation Number 45, Guarantor's
Accounting and Disclosure Requirements for Guarantees, Including Indirect
Guarantees of Indebtedness of Others ("FIN 45"). This interpretation requires
certain disclosures to be made by a guarantor in its interim and annual
financial statements about its obligations under certain guarantees that it has
issued. It also requires a guarantor to recognize, at the inception of a
guarantee, a liability for the fair value of the obligation undertaken in
issuing the guarantee. The disclosure requirements of FIN 45 are effective for
interim and annual periods after December 15, 2002. The adoption of FIN 45 did
not have a material impact on our consolidated financial statements.

    In January 2003, the FASB issued FASB Interpretation No. 46, Consolidation
of Variable Interest Entities - an interpretation of ARB No. 51 ("FIN 46"). FIN
46 clarifies the application of Accounting Research Bulletin No. 51,
Consolidated Financial Statements, to certain entities in which equity investors
do not have the characteristics of a controlling financial interest or do not
have sufficient equity at risk for the entity to finance its activities without
additional subordinated financial support from other parties. FIN 46 is
effective for the first fiscal year or interim period beginning after June 15,
2003 to variable interest entities in which an enterprise holds a variable
interest that it acquired before February 1, 2003. We do not anticipate that the
adoption of FIN 46 will have a material impact on our consolidated financial
statements.

    Several new Dutch accounting guidelines became effective January 1, 2002.
Generally, these guidelines further align Dutch accounting standards with
international accounting standards. The new guidelines did not have a material
impact on our Dutch GAAP financial statements or the reconciliation between
United States and Dutch GAAP.




ITEM 6.  DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

    Our Management Board manages our general affairs and business. Our
Supervisory Board supervises the Management Board.

Supervisory Board

    Our Supervisory Board must approve the resolutions of our Management Board
specified in our articles of association. Our Supervisory Board also advises our
Management Board. In fulfilling their duties, all members of our Supervisory
Board must serve our best interests and the best interests of the business of
our connected enterprises.

    Our articles of association provide that at least three and at most eleven
supervisory directors may serve on our Supervisory Board. Each of our current
supervisory directors was elected for a one-year term and can be re-elected
without limitation until he or she reaches the age of seventy-two. At our last
annual general meeting in May 2003 our shareholders elected nine members to our
Supervisory Board. Under Dutch law, supervisory directors cannot serve as
members of our Management Board.

    The general meeting of shareholders appoints the supervisory directors. Our
shareholders choose the supervisory directors at the general meeting from
non-binding nominations made by the Supervisory Board or by shareholders holding
2 percent or more of our issued and outstanding share capital, and from
declarations of availability submitted by a member of the Supervisory Board who
is not otherwise nominated by the Supervisory Board. The general meeting of
shareholders votes on candidates nominated by the Supervisory Board before
voting on any other candidates. The general meeting of shareholders also decides
the compensation we will pay the supervisory directors. If we were to become
subject to the "structured regime" for large companies in the Netherlands,
however, we would be required to amend our articles of association within three
years to allow supervisory directors to nominate and appoint the candidates for
supervisory directors without shareholder oversight. Dutch law mandates that
companies become subject to the structured regime if they meet certain
requirements including, for example, that for an uninterrupted period of three
years they have more than 100 employees in The Netherlands and they establish
and maintain a works council.

    An absolute majority of the votes cast at a Supervisory Board meeting is
required to approve most decisions.

    The business address of each supervisory director is the address of our
principal executive office in The Hague. All of our Supervisory Board members
currently hold ordinary shares or ADSs, as well as options and rights to acquire
shares. See "-- Compensation of Supervisory Board".

    Our Supervisory Board currently consists of nine members. These supervisory
directors are:

Name                                            Age      Position


Terence Seddon..........................        62      Chairman
S.K. Fung...............................        56      Member
Ashok Ganguly...........................        67      Member
Jerry Kolb..............................        67      Member
Neelie Kroes............................        61      Member
Gerd D. Mueller.........................        66      Member
Luigi Ruspantini........................        63      Member
Claude Seguin...........................        53      Member
Don Wear................................        56      Member

    Our Supervisory Board has three standing committees: Audit and Finance,
Management Compensation and Development and Corporate Governance. Membership on
the committees is:

                                 Committees
--------------------------------------------------------------------------------
    Audit & Finance       Management Compensation &      Corporate Goverance
                                 Development
----------------------    ---------------------------   ------------------------

 Claude Seguin (Chair)       Terence Seddon (Chair)       Neelie Kroes (Chair)
 S.K. Fung                   Ashok Ganguly                S.K. Fung
 Jerry Kolb                  Jerry Kolb                   Terence Seddon
 Gerd D. Mueller             Luigi Ruspantini             Don Wear

    Mr. Seddon, 62 years of age, has served as Chairman of the Supervisory Board
since May 1998. He is a citizen of the United Kingdom. Mr. Seddon currently is
retired. Prior to his retirement he served as Director of Projects in Europe and
also as the Malaysian Representative Director for Cable and Wireless. Prior to
that, Mr. Seddon served as Chief Executive Officer of Asia Satellite
Telecommunications Company Ltd. from 1988 - 1993. Mr. Seddon is a non-executive
Director of Multitone Electronics plc, a specialist mobile telecommunications
product provider.

     Mr. Fung, 56 years of age, has served as a Supervisory Director since May
1999. He is a citizen of the United States of America. Mr. Fung currently is
Managing Director, North Asia of ACNielsen (a VNU N.V. company), a global
provider of market information, research and analysis. Previously, he was a
Director of Media Genesis Limited from 2000 to 2002. From 1999 to 2000, Mr. Fung
was Managing Director of Sage Capital Management and from 1995 to 1999 he was
President of NBC Asia and established the Asian operations of NBC. Mr. Fung also
served as the Chairman of the Cable and Satellite Broadcasting Association of
Asia (CASBAA) from 1997 to 1999. From 1987 to 1995, he was General Manager of
TVB International, a leading broadcaster in Hong Kong.

    Dr. Ganguly, 67 years of age, has served as a Supervisory Director since May
2002. He is a citizen of India. Dr. Ganguly currently serves as the Chairman of
ICICI One Source Ltd., as a Director on the Central Board of the Reserve Bank of
India, to which post he was appointed in November 2000, and as a Director on the
Board of Hemogenomics Pvt Ltd, to which post he was appointed in November 2002.
In addition, Dr. Ganguly heads his own company, Technology Network India Pvt
Ltd., which focuses on industrial research & development and supply chain
management. Dr. Ganguly's principal professional career spanned 35 years with
Unilever, which culminated with his service as a member of the Board of
Directors of Unilever N.V. from 1990 through 1997 with responsibility for
world-wide research and technology. Dr. Ganguly also currently serves as a
non-executive Director of British Airways plc, Mahindra & Mahindra, WIPRO Ltd,
ICICI Knowledge Park, and Tata AIG Life Insurance Co Ltd.. During his career,
Dr. Ganguly has served several public bodies including as a member of the
Science Advisory Council to the Prime Minister of India (1985-89) and the UK
Advisory Board of Research Councils. His honors include, among others, the
Indian award of Padma Bhushan and being named an Honorary Professor by the
Chinese Academy of Science, Shanghai.

Mr. Kolb, 67 years of age, has served as a Supervisory Director since May 1998.
He is a citizen of the United States of America. Until his retirement in May
1998, Mr. Kolb was Vice Chairman of Deloitte & Touche LLP, an international
public accounting and consulting firm. He joined the accounting firm in 1957 and
served as Managing Partner of the Chicago office, Managing Partner of
professional services, and Chief Financial and Administrative Officer, as well
as Vice Chairman. Mr. Kolb has been a member of the Board of Directors of
Gaylord Container Corporation, a manufacturer and distributor of corrugated
containers, containerboard and other paper products, from August 1998 to May
2002, of Mid America Group, a commercial and residential real estate development
and management company, from August 2002, and of Walter Industries, Inc. from
June 2003.

    Mrs. Kroes, 61 years of age, has served as a Supervisory Director since May
1999. She is a citizen of the Netherlands. From 1991 to 2000 Mrs. Kroes served
as President of Nijenrode University in the Netherlands. Prior to that, she
served as an advisor to the European Transport Commissioner from 1989 to 1991
and as Cabinet Minister for Transport and Public Works in the Netherlands from
1982 to 1989. She also served as Deputy Minister for Transport and Public Works
in the Netherlands from 1977 to 1981. Mrs. Kroes is a Member of the Boards of
the following companies: Ballast Nedam N.V., P & O Nedloyd, ProLogis, Corio N.V.
(formerly VIB N.V.), Lucent Technologies B.V., Volvo Group (Sweden), Thales
Group, MM02 (non-executive board), and Nederlandse Spoorwegen (Supervisory
Board). Mrs. Kroes is as of December 2002 a member of the High Level Group on
the trans-European Network in Brussels.

    Mr. Mueller, 66 years of age, has served as a Supervisory Director since May
2001. He is a citizen of Germany and the United States of America residing in
the United States of America. Mr. Mueller is currently retired. Prior to his
retirement, Mr. Mueller served as Executive Vice President and Chief
Administrative and Financial Officer of Bayer Corporation, the U.S. wholly owned
subsidiary of Bayer AG, Germany. He is currently a member of the Board of
Directors of Schott Corporation, a U.S. wholly owned subsidiary of the German
company Schott Glas. Mr. Mueller also is a trustee of the Robert Morris
University and a member of the Board of Directors of the Western Pennsylvania
Hospital, both in Pittsburgh, and Chairman of CDS International (formerly Carl
Duisberg Society), a non-profit organization engaged in the implementation of
exchange programs for young professionals primarily between the United States
and Europe.

    Mr. Ruspantini, 63 years of age, has served as a Supervisory Director since
May 1998. He is a citizen of Italy. Mr. Ruspantini is presently retired after
more than 30 years of experience in satellite communications. Prior to his
retirement, he served as Assistant to the Chief Executive Officer of Telespazio,
at the time a fully owned subsidiary of Telecom Italia, where he was responsible
for the definition of the company's multimedia program strategy and
implementation. Prior to 1997, Mr. Ruspantini served as Director of the
Broadcast Services division of Telespazio and oversaw the provision of
Television, Business Television and Radio Services to the company's customers in
Italy and abroad.

    Mr. Seguin, 53 years of age, has served as a Supervisory Director since May
1998. He is a citizen of Canada. Mr. Seguin is currently Senior Vice President -
Strategic Investments for the Montreal based CGI Group, a global IT service
provider. Previously, he was President of CDP Capital - Private Equity from 2001
to 2003 and Executive Vice-President and Chief Financial Officer of Teleglobe
Inc. from 1992 to 2000. Immediately prior to that, he was the Deputy Minister of
Finance for the Province of Quebec, to which post he was appointed in 1987.

    Mr. Wear, 56 years of age, has served as a Supervisory Director since May
2001. He is a citizen of the United States of America. In 2001 Mr. Wear started
his own business, Wear Multimedia International. Mr. Wear has spent the majority
of his career in the media, television and telecommunications industries,
working in legal, regulatory, commercial, business and senior executive
positions. From 1997 to 2001 Mr. Wear was the President, International Policy
and President, International Networks at Discovery Communications, Inc. From
1993 to 1997, Mr. Wear was Vice President and General Counsel of INTELSAT. Mr.
Wear is a member of the Board of Directors of the International Council of the
National Academy of Television Arts and Sciences in the United States. He is
also a member of several advisory panels, committees and councils dealing with
telecommunications- and television-related matters.

Compensation of Supervisory Board

    Each of our supervisory directors receives a quarterly fee. Additionally,
each supervisory director is paid a stipend in connection with attendance at,
and travel to and from, a Supervisory Board meeting or a Supervisory Board
committee meeting, and reimbursement in connection with other expenses. The
total amount paid to our supervisory directors during 2002 was approximately
$0.5 million. In 2002, the total remuneration of the individual members of the
Supervisory Board were as follows (in thousands of U.S. dollars):

       Supervisory Board
       T.M. Seddon                     $        87
       J.W. Kolb                                59
       C. Seguin                                55
       G.D. Mueller                             54
       L. Ruspantini                            53
       D. Wear                                  53
       S.K. Fung                                50
       N. Kroes                                 39
       A.S. Ganguly                             33
       T. Hashimoto                             10
                                       ------------------
       Total                           $       493
                                       ==================

    We have awarded options to acquire ordinary shares to the members of our
Supervisory Board for each year since our inception. Each option grant has been,
and each future option grant must be, approved by shareholders based on a
proposed grant made to them. The vesting period for all options is three years
and the options have a maximum term of 10 years.

    We granted 99,970 options to the supervisory directors in aggregate in 1998
and 127,960 options in aggregate to them in May 1999. The general meeting of
shareholders approved 1998 and 1999 grants at the annual general meeting held in
June 2000. The exercise price of $7.50 for these options was set at the
estimated fair market value at the time they were granted. Under U.S. GAAP the
Company must record a non-cash compensation cost equal to the excess of the
market value of the shares at the date of ratification (June 28, 2000) over the
exercise price. In establishing the fair market value of the shares, the
Supervisory Board utilized an independent valuation performed by KPMG Corporate
Finance. The calculated compensation cost was amortized over the vesting period
of the options. Using the independent valuation performed by KPMG Corporate
Finance, we have determined that the fair market value of these options was
$11.00 each on June 28, 2000. Accordingly, we recorded $0.8 million as unearned
compensation of which $0.5 million was expensed in 2000 and the remainder was
expensed in 2001 and 2002.

    We also granted options to acquire ordinary shares to the members of our
Supervisory Board in 2003, 2002, 2001 and 2000. The exercise price of these
options was set at the fair market value as of the date of grant. Complete
details of these option grants is set forth in the tables under "-- Outstanding
Stock and Stock Options of the Supervisory Board and the Management Board as of
May 22, 2003".

    In 2003 and 2002, our shareholders also approved the grant to the members of
our Supervisory Board of rights to acquire ordinary shares. These rights are
similar to restricted stock grants, which entitle (and require) the individual
to purchase the shares specified in the grant at a price per share equal to
nominal value ((euro)0.05). The purchase of shares under each grant is to be
settled in three equal installments within 30 days of the designated settlement
dates, which are the first, second and third anniversary of the date of grant.
Grants may be extinguished under certain limited circumstances if the individual
recipient ceases to be a member of our Supervisory Board. As is the case with
options, our shareholders must approve any and all proposed future grants of
this nature.

    We currently have no loans outstanding to members of our Supervisory Board.

Management Board

    Our Management Board manages our business and operations under the
supervision of our Supervisory Board. The general meeting of shareholders
appoints members of our Management Board from binding nominations drawn up by
our Supervisory Board and from nominations made by our shareholders holding two
percent or more of our issued and outstanding share capital, pursuant to a
mechanism described in our Articles of Association. This list of binding
nominations drawn up by our Supervisory Board contains at least two nominations
for each Management Board vacancy to be filled. The general meeting can
over-ride these binding nominations by a vote of two-thirds of the votes cast.
This vote must represent more than one-half of the issued share capital. If our
Supervisory Board does not nominate anyone for a specific position or their
nominee for that position is defeated, the general meeting of shareholders may
appoint any candidate duly nominated by a shareholder holding two percent or
more of our shares by an absolute majority of the votes cast.

    Our Supervisory Board may suspend, but not dismiss, any member of our
Management Board. The general meeting of shareholders has the power to lift a
suspension. In addition, the general meeting of shareholders may dismiss or
suspend any or all members of our Management Board at any time. A resolution to
suspend or dismiss any member of our Management Board may only be passed by a
two-thirds majority of the votes cast representing more than one half of the
issued capital, unless the proposal was made by the Supervisory Board.

    A majority of the members of our Management Board present or represented at
a meeting is required to adopt decisions. Our Management Board may only adopt
valid resolutions by favorable vote when the majority of the members of our
Management Board in office are present or represented at a meeting, provided
that the majority shall at least include the vote of the chief executive
officer.

    Our Management Board is vested with the general legal authority to represent
us. Any member of our Management Board, acting severally, is authorized to
represent us. Certain decisions of our Management Board require the prior
approval of our Supervisory Board. Our articles of association identify these
decisions as they currently stand.

    Our Supervisory Board determines the compensation and benefits of the
members of our Management Board.

    The business address of each member of our Management Board is the address
of our principal executive office in The Hague. Each member of our Management
Board currently holds some ordinary shares and/or options. See "-- Compensation
of Management Board".

    Our articles of association provide that members of our Supervisory Board
are entitled to represent us in case of conflicts of interest between us and
members of our Management Board.

    According to our corporate purpose, we may arrange financing and may take up
loans and provide security for our loans and obligations, as well as for loans
and obligations of companies controlled by our affiliates our subsidiaries or
us. This means that our Management Board and any member of our Management Board
can bind us vis-a-vis third parties in this respect. This can only be varied by
an amendment of our articles of association effecting an amendment to our
corporate purpose, or to our representation provision.

    Our Management Board had six members until February 21, 2003, when Mr. R.
Jockin resigned as Executive Vice President, Sales and Marketing. As a
consequence, as of February 21, 2003, our Management Board has five members. The
members of our Management Board are:

Name                     Age     Position
----                     ---     --------
Daniel Goldberg.......   38      Chief Executive Officer
Andrew Browne.........   47      Chief Financial Officer
Timothy Cowart........   36      Senior Vice President,  Corporate Development
Mary Dent.............   41      General Counsel
Stephen Stott.........   56      Chief Technical Officer

    Mr. Goldberg, 38 years of age, has served as our Chief Executive Officer
since January 2002. Prior to that, he had served as our Chief Operating Officer
from February 2000, and prior to that time, he had served as our General Counsel
since October 1998. Prior to joining us, he worked at PanAmSat as the Associate
General Counsel and Vice President of Government and Regulatory Affairs during
1998. From 1993 to 1997, Mr. Goldberg was an associate at Goldberg, Godles,
Wiener & Wright, a law firm in Washington D.C.

    Mr. Browne, 47 years of age, has served as our Chief Financial Officer since
October 1998. Prior to joining us, he served as Vice President, Chief Financial
Officer of INTELSAT. From 1985 to 1995, Mr. Browne worked for Advanced Micro
Devices, Inc. in several financial and business capacities and, on leaving, was
Director of Worldwide Finance, Sales and Marketing Operations.

    Mr. Cowart, 36 years of age, has served as our Senior Vice President of
Corporate Development since March 1999. Prior to joining us, he worked at
PanAmSat as Vice President of Business Development from 1998 to 1999 and as
Director of Financial Planning from 1997 to 1998. Prior to that, he worked at
Hughes Electronics Corp. from 1995 to 1997 as a senior associate of corporate
development, and from 1993 to 1995 he worked at The Geneva Companies, Inc. as an
associate vice president.

    Ms. Dent, 41 years of age, has served as our General Counsel since March
2000. Prior to joining us, she practiced telecommunications law from 1992 to
2000 with the firm of Goldberg, Godles, Wiener & Wright. Previously, Ms. Dent
served as a counsel for U.S. Senator Edward M. Kennedy and worked in various
capacities for satellite communications companies Hughes Communications Inc. and
Equatorial Communications Co.

    Mr. Stott, 56 years of age, has served as our Chief Technical Officer since
March 1999. Prior to joining us, he worked at INTELSAT from 1985 to 1999, most
recently as Director of Satellite Systems Engineering from 1996 to 1999.

Compensation of Management Board

    In 2002, we had six Management Board members. The aggregate annual base
salary compensation that our Management Board members received during 2002 was
$2.0 million. The members of our Management Board are eligible to participate in
the company's Employee Annual Incentive Plan. In accordance with the terms and
conditions of this plan, in 2002, the Chief Executive Officer and certain other
Management Board members were eligible for an on-target bonus equal to 40
percent of their annual base salary, and the other Management Board members were
eligible for an on-target bonus equal to 25 percent of their annual base salary.
Bonus payments depend on our financial results and achievement of individual
goals and objectives. In February 2003, the Supervisory Board approved an
aggregate amount of $0.6 million in performance related bonus/incentive
compensation for the six members of our Management Board for the year 2002,
including our retired Chief Executive Officer. Other compensation was provided
to the six members of our Management Board in the form of pension contributions
and company leased cars, totaling $0.1 million in aggregate in 2002.

    Total remuneration of the Management Board, including pension costs for the
year ended December 31, 2002, is summarized as follows (in thousands of U.S.
dollars):

                          Base Salary      Bonus       Pension         Total
                        --------------------------------------------------------
  Management Board
   D.S. Goldberg               450          225           27            702
   A.M. Browne                 451           93           34            578
   S.J. Stott                  340           70           31            441
   R. Jockin                   275           92           21            388
   M.J. Dent                   262           88           16            366
   T.L. Cowart                 255           52           15            322
                        --------------------------------------------------------
      Total                  2,033          620          144          2,797
                        ========================================================


    We have established a stock option plan with respect to our management and
employees. Under this plan, members of our Management Board and other specified
employees may be granted an option to acquire a specified number of ordinary
shares. The exercise price for all options issued to date has been between $4.66
and $11.00. The options granted are exercisable for a period of 10 years after
the grant date but are subject to vesting or, in certain cases, resale
restrictions, as well as other restrictions. Options granted vest (or, where
applicable, the resale restrictions are voided) in three equal annual
installments. On December 31, 2002 (and adjusting for the share split), the
number of options outstanding under this plan was 6,910,629. The total number of
unexercised outstanding options held by members of our Management Board as a
group on December 31, 2002 was, on the same basis, 1,845,434. The options have a
maximum term of 10 years. In 2003, we also granted 448,133 stock options to the
members of our Management Board in aggregate for performance during 2002. The
vesting period of these options is three years and they have a maximum term of
10 years. The exercise price for these options was set at the fair market value
as of the date of grant.


    In addition to option grants, the Management Board compensation package for
2002 and 2003 also consisted of grants of rights to acquire shares. In February
2002 we granted to the members of our Management Board rights to acquire an
aggregate of 233,736 ordinary shares and in February 2003 we granted to the
members of our Management Board rights to acquire an aggregate of 180,253
ordinary shares. These rights are similar to restricted stock grants, which
entitle (and require) the individual to purchase the shares specified in the
grant at a price per share equal to nominal value ((euro)0.05). The purchase of
shares under each grant is to be settled in three equal installments within 30
days of the designated settlement dates, which generally are the first, second
and third anniversary of the date of grant. However, in the case of the 2002
grant to our chief executive officer, the settlement dates have been aligned to
match those of the grants made to other members of the Management Board.

    All Management Board equity grants (both options and grants of rights to
acquire shares) are governed by a plan administered by the Supervisory Board.
Under the plans, the size of a grant to an eligible recipient is determined at
the discretion of the plan administrator. All grants under the option plan,
including option grants to employees, are subject to an aggregate cap, which was
raised in 2002 to a total of 13,057,024 ordinary shares. Grants may be
extinguished under certain limited circumstances if the individual recipient
ceases to be an employee of the company.

    For further information regarding stock options, including the accounting
impact and vesting of these options, see Note 10 to our consolidated financial
statements included elsewhere in this annual report.

    We currently have no loans outstanding to members of our Management Board.

Limitation of Liability and Indemnification Matters

    Pursuant to Dutch law, each member of our Supervisory Board and our
Management Board is responsible to us for the proper performance of his or her
assigned duties. They are also responsible for taking measures to prevent the
consequences of any improper performance of duties by another member of our
Supervisory Board or our Management Board. Our articles of association provide
that the adoption of our annual accounts by the general meeting of shareholders
constitutes a discharge from liability for the members of our Supervisory Board
and our Management Board in respect of the exercise of their duties during the
financial year concerned. This is the case only so long as no proviso has
explicitly been made, and without prejudice to what has been or will be provided
by law.

    This discharge of liability may be limited by mandatory provisions of Dutch
law, such as in the case of bankruptcy. In addition, this discharge extends only
to actions or omissions disclosed in or apparent from the adopted annual
accounts or otherwise communicated to the general meeting of shareholders. In
case of actions or omissions, the members of our Supervisory Board and our
Management Board could be jointly and severally liable toward third parties for
any loss sustained by these third parties as a result of these actions or
omissions. An individual Supervisory Board or Management Board member can avoid
liability if he or she can prove that he or she was not responsible for these
actions or omissions and that he or she has not been negligent in taking
measures to prevent the consequences of those actions or omissions. Under Dutch
law, our supervisory directors generally cannot be held personally liable for
decisions made exercising their reasonable business judgment.

    Our articles of association require us to indemnify the persons described
below against all expenses (including attorney's fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by them in relation
to any threatened, pending or completed action, suits or other proceedings,
other than an action by us or on our behalf. We shall also indemnify those
persons if they are threatened to be made a party to any threatened, pending or
completed action or proceeding by or in our right to procure a judgment in their
favor. We shall indemnify a person who acted in good faith and in a manner that
he or she reasonably believed to be in, or not opposed to, our best interests
and who is or was:

     o    a member of our Supervisory Board,

     o    a member of our Management Board,

     o    an officer or agent, or

     o    was serving at our request as a member of our Supervisory Board,
          Management Board, or was an officer or agent of another company, a
          partnership, joint venture, foundation, trust or other enterprise.

    This indemnification generally will not be available if the person seeking
indemnification acted with gross negligence or willful misconduct in the
performance of their duty to us. A court in which an action is brought may,
however, determine that indemnification is appropriate nonetheless.

Outstanding Stock and Stock Options of the Supervisory Board and the Management
Board as of May 22, 2003.

    The following table sets forth the number of shares owned by the respective
individual determined in accordance with the rules of the Securities and
Exchange Commission.
<TABLE>
<CAPTION>

                                                                             Number of       Percent of
                                                            Percent of       shares and        total
                                           Number of      total issued      exercisable       issued
Name                                       shares (1)       shares (2)      options (3)      shares (4)
----                                       ---------        ----------      -----------      ----------
<S>                                          <C>            <C>             <C>              <C>
Supervisory Board:
Terence Seddon.........................       2,314             *            54,681             *
S.K. Fung..............................       3,607             *            26,585             *
Ashok Ganguly..........................         607             *             2,125             *
Jerry Kolb.............................       2,607             *            41,575             *
Neelie Kroes...........................         668             *            25,944             *
Gerd Mueller (5).......................       5,607             *            12,985             *
Luigi Ruspantini.......................       1,607             *            37,915             *
Claude Seguin..........................       3,668             *            43,604             *
Don Wear...............................       1,107             *             8,485             *
                                             ------                        -------
     Total.............................      21,792             *           253,899          0.2%

Management Board:
Daniel Goldberg........................      46,000             *           389,370          0.3%
Andrew Browne..........................      11,835             *           426,079          0.3%
Timothy Cowart.........................      10,143             *           200,550          0.2%
Mary Dent..............................      10,759             *           155,002          0.1%
Stephen Stott..........................      11,156                         257,999          0.2%
                                             ------                        -------
     Total.............................      89,893             *         1,429,000          1.1%
</TABLE>


(1)  Represents share ownership as reported to us by the named individuals.
     Because our shares are publicly traded in bearer form, we have no
     independent means to verify any shareholder's beneficial ownership.


(2)  An asterisk indicates that the percentage is less than one-tenth of one
     percent.


(3)  Represents share ownership as reported to us by the named individuals.
     Because our shares are publicly traded in bearer form, we have no
     independent means to verify any shareholder's beneficial ownership. The
     information includes options over our ordinary shares that are exercisable
     within 60 days of the date of calculation in accordance with Rule 13d-3
     under the U.S. Securities and Exchange Act.


(4)  The percentage is calculated by dividing the number of shares indicated for
     the person or group of persons by the sum of the total number of shares
     issued and outstanding plus the number of options over ordinary shares held
     by the relevant person or group of persons which are exercisable within 60
     days. An asterisk indicates that the percentage is less than one-tenth of
     one percent.

(5)  The shares are held by the Helen Mueller Revocable Trust.

In addition to shares owned or subject to options that are exercisable within 60
days, our supervisory directors and members of the Management Board also have
rights to acquire our ordinary shares. These rights are similar to restricted
stock grants, which entitle (and require) the individual to purchase a
pre-determined number of shares at a price per share equal to nominal value
((euro)0.05), and the purchase of shares subject to each grant is to be settled
in three equal installments within 30 days of the designated settlement dates,
which are the first, second and third anniversary of the date of grant. See
"Compensation of Supervisory Board" and "Management Compensation" for a full
discussion of these rights. Because none of these shares are included in the
table above or are comparable to options set forth in the second table further
below, the following table illustrates the shares subject to these rights
agreements.
<TABLE>
<CAPTION>

                                        Number of        Purchase price per
Name                                    shares (1)              share           Settlement Dates
----                                    ----------              -----           ----------------
<S>                                        <C>                   <C>               <C>
Supervisory Board:
Terence Seddon....................         1,658         (euro)  0.05              05-22-04
                                           1,658                 0.05              05-22-05
                                           1,659                 0.05              05-22-06
                                           1,214                 0.05              05-16-04
                                           1,215                 0.05              05-16-05
S.K. Fung.........................           829                 0.05              05-22-04
                                             829                 0.05              05-22-05
                                             830                 0.05              05-22-06
                                             607                 0.05              05-16-04
                                             608                 0.05              05-16-05
Ashok Ganguly.....................           829                 0.05              05-22-04
                                             829                 0.05              05-22-05
                                             830                 0.05              05-22-06
                                             607                 0.05              05-16-04
                                             608                 0.05              05-16-05
Jerry Kolb........................           829                 0.05              05-22-04
                                             829                 0.05              05-22-05
                                             830                 0.05              05-22-06
                                             607                 0.05              05-16-04
                                             608                 0.05              05-16-05
Neelie Kroes......................           911                 0.05              05-22-04
                                             912                 0.05              05-22-05
                                             912                 0.05              05-22-06
                                             668                 0.05              05-16-04
                                             668                 0.05              05-16-05
Gerd Mueller......................           829                 0.05              05-22-04
                                             829                 0.05              05-22-05
                                             830                 0.05              05-22-06
                                             607                 0.05              05-16-04
                                             608                 0.05              05-16-05
Luigi Ruspantini..................           829                 0.05              05-22-04
                                             829                 0.05              05-22-05
                                             830                 0.05              05-22-06
                                             607                 0.05              05-16-04
                                             608                 0.05              05-16-05
Claude Seguin.....................           911                 0.05              05-22-04
                                             912                 0.05              05-22-05
                                             912                 0.05              05-22-06
                                             668                 0.05              05-16-04
                                             668                 0.05              05-16-05
Don Wear..........................           829                 0.05              05-22-04
                                             829                 0.05              05-22-05
                                             830                 0.05              05-22-06
                                             607                 0.05              05-16-04
                                             608                 0.05              05-16-05

Management Board:
Daniel Goldberg...................        25,751          (euro) 0.05              02-01-04
                                          25,751                 0.05              02-01-05
                                          25,751                 0.05              02-01-06
                                          36,000                 0.05              02-25-04
                                          36,000                 0.05              02-25-05
Andrew Browne.....................        13,333                 0.05              02-01-04
                                          13,333                 0.05              02-01-05
                                          13,334                 0.05              02-01-06
                                          10,835                 0.05              02-25-04
                                          10,835                 0.05              02-25-05
Timothy Cowart....................         7,666                 0.05              02-01-04
                                           7,667                 0.05              02-01-05
                                           7,667                 0.05              02-01-06
                                           7,643                 0.05              02-25-04
                                           7,643                 0.05              02-25-05
Mary Dent.........................        10,000                 0.05              02-01-04
                                           8,860                 0.05              02-25-04
                                           8,860                 0.05              02-25-05
Stephen Stott.....................        10,000                 0.05              02-01-04
                                          10,000                 0.05              02-01-05
                                          10,000                 0.05              02-01-06
                                           8,156                 0.05              02-25-04
                                           8,156                 0.05              02-25-05
</TABLE>


    The following table sets forth the information regarding stock option
ownership for each member of our Supervisory Board and Management Board.
<TABLE>
<CAPTION>

                                       Number of             Exercise            Expiration
Name                                  Options (1)             Price               Date (2)
----                                  -----------             -----               --------
<S>                                    <C>                   <C>               <C>
Supervisory Board:
Terence Seddon...................        17,330              $7.50                05-14-08
                                         17,330               7.50                05-27-09
                                          2,950              11.00                06-28-10
                                         17,581               7.11                05-17-11
                                          9,108               5.49                05-16-12
                                         12,437               6.03                05-22-13
S.K. Fung........................        13,330               7.50                05-27-09
                                          2,270              11.00                06-28-10
                                          8,790               7.11                05-17-11
                                          4,554               5.49                05-16-12
                                          6,219               6.03                05-22-13
Ashok Ganguly....................         4,554               5.49                05-16-12
                                          6,219               6.03                05-22-13
Jerry Kolb.......................        14,660               7.50                05-14-08
                                         14,660               7.50                05-27-09
                                          2,270              11.00                06-28-10
                                          8,790               7.11                05-17-11
                                          4,554               5.49                05-16-12
                                          6,219               6.03                05-22-13
Neelie Kroes.....................        14,660               7.50                05-27-09
                                          2,500              11.00                06-28-10
                                          9,669               7.11                05-17-11
                                          5,009               5.49                05-16-12
                                          6,841               6.03                05-22-13
Gerd Mueller.....................         8,790               7.11                05-17-11
                                          4,554               5.49                05-16-12
                                          6,219               6.03                05-22-13
Luigi Ruspantini.................        13,330               7.50                05-14-08
                                         13,330               7.50                05-27-09
                                          2,270              11.00                06-28-10
                                          8,790               7.11                05-17-11
                                          4,554               5.49                05-16-12
                                          6,219               6.03                05-22-13
Claude Seguin....................        14,660               7.50                05-14-08
                                         14,660               7.50                05-27-09
                                          2,500              11.00                06-28-10
                                          9,669               7.11                05-17-11
                                          5,009               5.49                05-16-12
                                          6,841               6.03                05-22-13
Don Wear.........................         8,790               7.11                05-17-11
                                          4,554               5.49                05-16-12
                                          6,219               6.03                05-22-13

Management Board:
Daniel Goldberg..................       233,330            $  7.50                10-26-08
                                         37,100              11.00                02-17-10
                                        109,410               9.14                02-23-11
                                        193,133               4.66                02-20-13
Andrew Browne....................       266,670               7.50                10-12-08
                                         43,900              11.00                02-17-10
                                        114,880               9.14                02-23-11
                                         81,262               5.00                02-25-12
                                        100,000               4.66                02-20-13
Timothy Cowart...................       120,000               7.50                03-04-09
                                         17,000              11.00                02-17-10
                                         51,450               9.14                02-23-11
                                         57,322               5.00                02-25-12
                                         55,000               4.66                02-20-13
Mary Dent........................        94,740               9.50                03-01-10
                                         41,030               9.14                02-23-11
                                         66,448               5.00                02-25-12
                                         25,000               4.66                02-20-13
Stephen Stott....................       160,000               7.50                03-29-09
                                         20,500              11.00                02-17-10
                                         68,930               9.14                02-23-11
                                         61,170               5.00                02-25-12
                                         75,000               4.66                02-20-13
----------
</TABLE>

(1)  All options are for our ordinary shares, which have the same voting rights
     as all of our other ordinary shares.
(2)  The expiration date of each option is 10 years from the date of grant,
     unless earlier cancelled.


ITEM 7.  MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

Principal Shareholders

The following table sets forth information regarding the beneficial ownership of
our ordinary shares at May 22, 2003 by each person known by us to own
beneficially more than five percent of our outstanding ordinary shares. For
information regarding holdings of shares, grants of stock options and rights to
acquire shares of the members of the Management Board and Supervisory Board see
Item 6.

     Except as otherwise indicated, each shareholder identified by name has:

     o    sole voting and investment power with respect to its shares; and

     o    record and beneficial ownership with respect to its shares.
<TABLE>
<CAPTION>

                                              Number of         Percent of total issued
                                           ordinary shares          ordinary shares
Lockheed Martin Global
<S>                                           <C>                       <C>
Telecommunications(1).....................     18,610,660                14.3%
Stichting Administratiekantoor NSS(2).....      8,135,230                 6.2%
K-Capital Partners LLC....................      See note (3)              5.8%
----------
</TABLE>

(1)  Includes ordinary shares held by wholly owned subsidiaries.

(2)  This stichting holds ordinary shares that could not be distributed to
     signatories or investing parties of our predecessor in connection with the
     transfer of our assets to us on November 30, 1998, together with the shares
     our predecessor distributed to its signatories and investing parties in
     February 2000 and July 2001, less shares that have been removed from the
     stichting by the relevant shareholders. These shares are held for the
     beneficial interest of individually designated signatories and investing
     parties. These shares will be registered in our share register in the name
     of the signatories and investing entities upon completion of appropriate
     documents of transfer.

(3)  The company has no information regarding the actual numbers of shares held
     by K Capital Partners LLC. Under Dutch Law K-Capital Partners LLC is only
     required to file publicly the percentage of shares they hold.

Changes in shareholdings by five-percent shareholders over the last three years.

    The following table shows the significant changes over the past three years
in the shareholdings of those shareholders who currently hold more than five
percent of our issued share capital. The table reflects only those significant
changes in percentage ownership caused an acquisition or disposition of shares
and does not reflect changes in percentage ownership caused by dilution. To
date, we have only issued ordinary shares. Currently, our shareholders may hold
our ordinary shares in one or more of three possible forms: registered shares,
bearer shares and American Depositary Shares, each of which represent one bearer
share. We can confirm the shareholdings and transfers only of shareholders who
hold registered shares. In addition, several of our shareholders hold beneficial
interests in a Dutch foundation, or stichting, which in turn holds registered
shares. Where a shareholder holds a beneficial interest through this stichting,
we are able to verify that beneficial ownership by reference to the stichting's
register. In the case of bearer shares and American Depositary Shares that are
publicly traded on the exchanges, we have no independent means to verify at any
given time the identity of a shareholder or the actual or beneficial ownership
of a known shareholder. In some cases, U.S. and Dutch law require shareholders
of public companies to report publicly their shareholding at certain thresholds,
and in those cases we have been able to verify their shareholding against public
records. As a result, the information below represents only the information that
is contained in our share register or in shareholder public filings that are
known to us. Finally, some of the share numbers below have been adjusted to
reflect a 10-to-1 stock split that became effective on August 24, 2000, and the
percentages are calculated based on the total number of issued and outstanding
shares, as adjusted for the stock split, as of the relevant date.
<TABLE>
<CAPTION>

--------------------------------------------------------------------------------------------------------------
Shareholder                  Transaction                 Date                Number of shares   Percentage
--------------------------------------------------------------------------------------------------------------
<S>                           <C>                       <C>                  <C>                <C>
Lockheed Martin Global       Acquisition of Comsat       August 3, 2000      18,610,660         18.6%
Telecommunications           Corporation and its
                             wholly-owned subsidiaries,
                             Comsat Argentina S.A. and
                             Comsat General Corporation
--------------------------------------------------------------------------------------------------------------
Stichting                    Additional acquisition      February 18, 2000   9,907,620          9.9%
Administratiekantoor NSS
--------------------------------------------------------------------------------------------------------------
                             Transfers                   2000                6,077,780 in 12    4.7%
                                                                             separate
                                                                             transactions
--------------------------------------------------------------------------------------------------------------
                             Transfers                   2001                2,049,630 in 15    1.6%
                                                                             separate
                                                                             transactions
--------------------------------------------------------------------------------------------------------------
                             Transfers                   2002                1,963,650 in 10    1.5%
                                                                             separate
                                                                             transactions
--------------------------------------------------------------------------------------------------------------
K-Capital Partners LLC       Acquisition(s)              May 14, 2003        See note (1)       5.8%
--------------------------------------------------------------------------------------------------------------
</TABLE>

----------
(1)  The company has no information regarding the actual numbers of shares held
     by K Capital Partners LLC. Under Dutch Law K-Capital Partners LLC is only
     required to file publicly the percentage of shares it holds.


    The following table shows the total number of shares held in The Netherlands
as of May 22, 2003. We can confirm the shareholdings only of shareholders who
hold registered shares. In the case of bearer shares and American Depositary
Shares that are publicly traded on the exchanges, we have no independent means
to verify at any given time the identity of a shareholder or the actual or
beneficial ownership of a known shareholder. In some cases, U.S. and Dutch law
require shareholders of public companies to publicly report their shareholding
at certain thresholds. However, individual shareholders may move their shares to
accounts within or outside of The Netherlands at any time without our knowledge.
As a result, the information below represents only the information that is
contained in our share register, and it is likely that there are a number of
shareholders located in The Netherlands that hold an indeterminable number of
shares that are not included in the table below.

    Our only shareholder of record in The Netherlands is a Dutch trust, or
stichting, which holds a number of our shares on behalf of others. We have
included the shares held by this trust in the number of shares stated below,
although, according to the stichting's register, none of the beneficial owners
of those shares are resident in The Netherlands. There are approximately 160
beneficial owners of shares who hold shares through that stichting.

      Number of Shares       Number of Shareholders                Percentage
      ----------------       ----------------------                ----------

         8,135,230                     1                              6.2%

Related Party Transactions

    We have entered into a number of contracts with our shareholders, including
those of our shareholders who hold more than five percent of our outstanding
shares. Certain of these contracts are ongoing service contracts with our
shareholders. We inherited some of these contracts from INTELSAT and we entered
into the others after beginning independent operations. We entered into the
construction contracts for NSS-7 and NSS-6 after beginning independent
operations. We believe that each of these contracts was entered into on an arm's
length basis.

    We entered into the other contracts with INTELSAT in connection with the
transfer of our assets to us at a time when INTELSAT was our sole shareholder.
Certain of these agreements subsequently have been amended.

Service Agreements

    From time to time, we conduct transactions with our shareholders, their
affiliates and other connected persons. We currently provide transponder
capacity to approximately 39 of our current shareholders, including one
shareholder who owns more than five percent of our outstanding share capital. We
anticipate that these arrangements and future similar arrangements will continue
to be conducted on an arm's length basis.

    With respect to our contracts with Lockheed Martin Global
Telecommunications, under the terms of 27 transponder agreements at December 31,
2002, we provide capacity of approximately 800MHz to Lockheed Martin Global
Telecommunications and its subsidiaries and affiliates. These agreements have
remaining terms of approximately 2.5 years on average. In 2002, revenues from
Lockheed Martin Global Telecommunications were approximately 19 percent of total
revenues.

    The transactions mentioned above have been entered into in the ordinary
course of business and on normal commercial terms.

Satellite Construction Contracts for NSS-7 and NSS-6

    Lockheed Martin Global Telecommunications, a wholly owned subsidiary of
Lockheed Martin Corporation, owns approximately 14 percent of our issued share
capital. We contracted with Lockheed Martin Corporation for the construction of
the NSS-7 satellite in 1999. See Item 4 "Business -- Our Satellites -- In-Orbit
Satellites -- NSS-7" for a further description of the NSS-7. We launched NSS-7
in April 2002. In August 2000 we entered into a separate contract with Lockheed
Martin Corporation for the construction of the NSS-6 satellite. See Item 4
"Business -- Our Satellites NSS-6" for a further description of NSS-6. We
launched NSS-6 in December 2002. These contracts have been filed as exhibits to
our Registration Statement on Form F-1 (No. 333-12564) filed September 19, 2000
under the Securities Act of 1933, as amended, and are incorporated by reference
into this annual report.

Agreements Related to the Transfer of Our Assets to Us

    We entered into each of the following agreements with INTELSAT on November
30, 1998 in connection with the transfer of our assets to us. Although INTELSAT
is no longer a related party, at the time we entered into the following
agreements, INTELSAT was a related party of ours. We believe these contracts
were entered into on an arm's length basis.

Subscription Agreement

    The subscription agreement imposes a number of ongoing obligations both on
us and on INTELSAT. Our obligations include the following:

     o    to use our best efforts to replace contracts that were assigned to us
          with new contracts that are directly with our customers;

     o    to use commercially reasonable efforts to transfer any contract
          subject to the leaseback arrangement directly to us;

     o    to take any necessary steps to retire the satellites that were
          transferred to us at the end of their useful lives;

     o    to abide by INTELSAT's coordination agreements with respect to each of
          the satellites transferred to us; and

o        to comply with certain indemnification provisions.

    INTELSAT did not warrant the condition of the satellites transferred to us.
However, on the date we acquired the satellites INTELSAT did provide
representations and warranties that it had disclosed to us all material
information in its possession regarding the technical health status of the
satellites, including material technical problems and the remaining fuel life of
the satellites. INTELSAT expressly excluded all implied warranties and made no
guarantees as to any other information regarding the condition of the
satellites.

    INTELSAT also made certain representations and warranties regarding the
validity and enforceability of the assigned contracts on the date of assignment.
It also agreed that, in the event of a dispute arising in connection with a
transponder service contract assigned to us, it will prosecute or settle any
claim which arises where no alternative forum is available, at our direction and
our cost.

Transponder Leasing Agreement

    The transponder leasing agreement is the agreement under which INTELSAT
leased back transponder capacity from us in order to fulfill the transponder
service contracts that were serviced by INTELSAT under the leaseback mechanism.
INTELSAT effectively terminated the leaseback mechanism by assigning to us all
active service contracts being administered under this mechanism at the time of
its privatization in 2001. Under certain limited circumstances we can reinstate
an inherited contract under the leaseback mechanism with INTELSAT's privatized
successor. While we have no current expectation that this will occur, the last
contract potentially subject to reinstatement on leaseback will not expire until
May 2014. The transponder leasing agreement will terminate on the date the last
agreement subject to leaseback is terminated.

Ensured Capacity Rights Agreement

    The ensured capacity rights agreement provides that, in some limited
circumstances, we are required to bid in response to a tender by INTELSAT's
privatized successor for transponder capacity to be used for international
public telecommunications services. If INTELSAT's privatized successor initiates
the procedures under the contract, we will be required to submit a proposal to
provide the capacity requested, subject to the following:

     o    to the extent we have available transponder capacity on existing
          satellites, we must submit a bid to provide the requested service
          using that existing capacity;

     o    if we do not have any spare transponder capacity, we must either
          submit a proposal for the provision of capacity involving the launch
          of a new satellite into an orbital position allocated to us or,
          alternatively, we could submit a proposal involving the launch of a
          new satellite into an orbital position provided by INTELSAT's
          privatized successor, at our option.

    If we are required to submit a proposal, our offer must be set at a price
calculated to earn an annual return on used assets of 10 percent above the
then-prevailing interest rate on 10-year U.S. Treasury obligations.

    The ensured capacity rights agreement was executed on November 30, 1998;
however the term of the contract begins on January 1, 2005 and the contract
expires on December 31, 2030. Accordingly, INTELSAT's privatized successor can
initiate the ensured capacity rights procedure only if they believe that they
would not be able to meet the demand themselves or if they have fewer than two
satellites in any particular ocean region.

Agreement Between New Skies Satellites and INTELSAT to Establish Technical
Compatibility Between New Skies Satellites' and INTELSAT's Satellite Networks

    We entered into an agreement on November 20, 1998 with INTELSAT to ensure
technical compatibility between the satellite system we operate and their
satellite system. The agreement addresses a number of issues, and is intended to
eliminate interference between satellites. In March 2002, we concluded an
additional frequency coordination agreement with Intelsat Ltd. (INTELSAT's
privatized successor) to ensure we could operate the NSS-7 satellite without
causing or receiving harmful interference from Intelsat's adjacent satellites.



ITEM 8.  FINANCIAL INFORMATION

             CONSOLIDATED STATEMENTS AND OTHER FINANCIAL INFORMATION

    See Item 18 "Financial Statements" pages F-1 to F-19.


ITEM 9.  THE OFFER AND LISTING

                 LISTING DETAILS AND ORDINARY SHARE PRICE RANGE

    Since our initial public offering in October 2000, our ordinary shares have
been listed on the official segment of the Euronext Amsterdam N.V. stock market
and our American Depositary Shares ("ADSs") have been listed on the New York
Stock Exchange under the symbol "NSK". The following table sets forth the low
and high sales prices of our shares as recorded on the Euronext Amsterdam N.V.
stock market and of our ADSs as recorded on the New York Stock Exchange for the
periods indicated.
<TABLE>
<CAPTION>

                                          New York Stock Exchange       Euronext Amsterdam N.V.
                                               price per ADS            price per Ordinary Share
                                            High            Low           High            Low
                                            ----            ---           ----            ---
                                                    ($)                           ((euro))
<S>                                        <C>             <C>           <C>             <C>
      Calendar Year 2001................   10.63           5.85          11.50           6.38
      Calendar Year 2002................    6.45           3.14           7.05           3.00
      First Quarter 2002................    6.45           4.50           7.05           5.00
      Second Quarter 2002...............    6.00           4.60           7.00           4.80
      Third Quarter 2002................    5.18           4.15           5.25           4.00
      Fourth Quarter 2002...............    4.45           3.14           4.47           3.00
      October 2002......................    4.45           3.50           4.47           3.30
      November 2002.....................    4.08           3.25           4.00           3.14
      December 2002.....................    4.45           3.14           4.12           3.00
      January 2003......................    4.12           3.76           3.85           3.55
      February 2003.....................    4.97           3.90           4.75           3.60
      March 2003........................    4.36           3.93           4.25           3.58
      April 2003........................    4.85           4.19           4.20           3.90
      May 2003..........................    6.35           4.20           7.15           4.88
</TABLE>


    On June 28, 2000, our shareholders approved a ten-for-one ordinary share
split and a change in the currency denomination and par value of our ordinary
shares from NLG 1.00 to (euro)0.05. These changes were effected on August 24,
2000, and the stock split has been given retroactive recognition in all periods
presented in our consolidated financial statements.



ITEM 10.  ADDITIONAL INFORMATION

                     MEMORANDUM AND ARTICLES OF ASSOCIATION

    Incorporated by reference from the Registrant's Registration Statement on
Form F-1 (No. 333-12564) filed by the Registrant with the Commission on
September 19, 2000.

                               MATERIAL CONTRACTS

    We have been party to the following material contracts since January 1,
2001:

     o    Amendment No. 2 to Contract No. NSS-20-03-01 for NSS-8 Spacecraft and
          Associated Equipment and Services between Boeing Satellite Systems
          International, Inc. and New Skies Satellites N.V. dated as of March
          21, 2001. This amendment amends the 21 March 2001contract for the
          construction and optional launch of the NSS-8 Satellite in order to
          re-purpose the satellite as a replacement for the NSS-703 satellite.
          See Item 4 "Business--Our Satellites--Planned Satellites--NSS-8".
          Note: Amendment No. 1 to this Contract was superseded in its entirety
          by Amendment No. 2.

     o    Amendment No. 3 to Contract No. NSS-20-03-01 for NSS-8 Spacecraft and
          Associated Equipment and Services between Boeing Satellite Systems
          International, Inc. and New Skies Satellites N.V. dated as of March
          21, 2001. This amendment amends the 21 March 2001contract for the
          construction and optional launch of the NSS-8 Satellite in order to
          optimize certain antenna optimization efforts.

     o    Launch Insurance Contract AF/AG982414 between New Skies Satellites
          N.V. and International Space Brokers dated November 23, 1998, as
          amended. This contract provided the launch insurance coverage for the
          launch of NSS-7 in April 2002 and for the launch of NSS-6 in December
          2002. The contract also provides for in-orbit insurance for all
          station-kept satellites.

     o    Subscription Agreement between New Skies Satellites N.V. and the
          International Telecommunications Satellite Organization, dated
          November 30, 1998. For a description of this contract see Item 7
          "Related Party Transactions--Agreements Related to the Transfer of Our
          Assets to Us--Subscription Agreement".

     o    Ensured Capacity Rights Contract between New Skies Satellites N.V. and
          the International Telecommunications Satellite Organization, dated
          November 30, 1998. For a description of this contract see Item 7
          "Related Party Transactions--Agreements Related to the Transfer of Our
          Assets to Us--Ensured Capacity Rights Agreement".

     o    Transponder Leasing Agreement between New Skies Satellites N.V. and
          the International Telecommunications Satellite Organization, dated
          November 30, 1998. For a description of this contract see Item 7
          "Related Party Transactions--Agreements Related to the Transfer of Our
          Assets to Us--Transponder Leasing Agreement".

     o    Option Agreement Regarding the Issuance and Subscription of Preference
          Shares in the Share Capital of New Skies Satellites N.V. See Item 3
          "Risk Factors--Provisions of our articles of association could prevent
          a change of control" for a discussion of the material terms of this
          option agreement.

     o    $300 million multi-currency loan agreement between New Skies
          Satellites N.V. and ABN AMRO Bank N.V. as Arranger, Agent and Original
          Lender and the banks named therein. For a discussion of the material
          terms of this contract see Item 5 "Operating and Financial Review and
          Prospects--Liquidity and Capital Resources--Liquidity."

     o    Employment Agreement between Daniel S. Goldberg and New Skies
          Satellites, N.V. dated April 23, 2002.



<PAGE>


                                    TAXATION

Netherlands Taxation

    Each investor should consult his or her own tax advisor with respect to the
tax consequences for holding our ordinary Shares or ADSs. The discussion of
certain Netherlands taxes set forth below is included for general information
only and does not address every potential tax consequence of an investment in
our ordinary shares or ADSs under the laws of The Netherlands. The following
summary of Netherlands tax considerations is limited to the tax implications for
(i) a corporation, owning less than five percent of our nominal issued share
capital and (ii) an individual who or a non-resident corporation which does not
have a substantial or deemed substantial interest in us. An individual holding
ordinary shares or ADSs has a substantial interest or deemed substantial
interest if he or she owns, alone or together with his or her partner and
certain other relatives, at least five percent of our issued share capital or
rights (including share options) to acquire at least five percent of our share
capital. A deemed substantial interest would be present if (part of) this
substantial interest is disposed of, or deemed to have been disposed of, under a
deferral facility. The sale of shares includes certain deemed dispositions of
shares, options or profit sharing rights.

    Dividend Withholding Tax

         Non-Residents of The Netherlands

    Dividends distributed by us are subject to Netherlands withholding tax at a
25 percent rate unless the recipient of the dividend qualifies for, and claims
the benefit of, a reduced rate under an applicable tax treaty. Dividends paid to
U.S. holders that are eligible for benefits under the income tax convention
between the United States and The Netherlands (the "Treaty") generally will be
subject to a reduced withholding rate of 15 percent; certain U.S. pension funds
and tax-exempt organizations will qualify for a complete exemption from
Netherlands tax. Whether a U.S. holder will be eligible for Treaty benefits is
discussed under "United States Taxation".

    An eligible U.S. holder may claim the benefit of the reduced Treaty
withholding rate by submitting a duly completed Form IB 92 USA that has been
certified by a financial institution (typically the entity that holds the
ordinary shares or ADSs as custodian for the holder). If we receive the required
documentation prior to the relevant dividend payment date, we may apply the
reduced withholding rate at source. An eligible U.S. holder that fails to
satisfy these requirements may claim a refund of the excess of the amount
withheld over the Treaty rate by filing Form IB 92 USA together with a
supplemental statement with the Netherlands tax authorities. Pension funds and
tax-exempt organizations, which qualify for a complete exemption from tax and
which are not entitled to claim Treaty benefits at source, instead must file
claims for refund by filing Form IB 95 USA.

    Under certain circumstances, we will not be required to transfer to the
Netherlands tax authorities the full amount of the tax we withhold with respect
to dividend distributions made on ordinary shares out of dividends received by
us from foreign affiliates. The amount not transferred to Netherlands tax
authorities cannot exceed three percent of the gross amount of any cash dividend
paid by us on the ordinary shares. This reduction in withholding taxes will not
be paid out to shareholders, but will accrue with us instead.

         Residents of The Netherlands

    Individuals or corporations (or an entity enjoying equivalent status under
Netherlands tax legislation, hereafter referred to as "corporation") which hold
ordinary shares or ADSs and are resident or deemed to be resident in The
Netherlands, will normally be entitled to credit, in whole or in part, the
dividend withholding tax on income from ordinary shares or ADSs against
Netherlands personal or corporate income tax due on such income.

    Netherlands resident entities that are not subject to corporate income tax
may, provided that the shares are not disposed of within 3 months after they
were acquired, apply for, and will normally be granted, a refund of the dividend
withholding tax. The withholding of dividend tax may not be required if the
so-called participation exemption as defined in section 13 of the Netherlands
Corporate Income Tax Act 1969 (Wet op de vennootschapsbelasting 1969) applies to
the benefits which the recipient of the income derives from the ordinary shares
and the ordinary shares form part of the recipient's business carried on in The
Netherlands.

         Anti-dividend stripping legislation

    Anti-dividend stripping measures working retroactively to April 27, 2001
were implemented on July 26, 2002. Based upon this legislation a refund, credit
or abstinence of withholding (in case the participation exemption applies) can
be denied when the person or entity that receives the dividend is considered not
to be the beneficial owner of these dividends.

    Netherlands Personal and Corporate Income Tax

         Non-residents of The Netherlands

    A holder of ordinary shares or ADSs will not be subject to Netherlands
income tax or corporate income tax in respect of dividend distributions on
ordinary shares or ADSs or capital gains realized on the disposal of ordinary
shares or ADSs, provided that:

     o    such holder is neither resident nor deemed to be resident in The
          Netherlands for tax purposes;

     o    such holder does not have an enterprise or an interest in an
          enterprise that is, in whole or in part, carried on through a
          permanent establishment or a permanent representative in The
          Netherlands and to which enterprise or part of an enterprise the
          ordinary shares or ADSs are attributable;

     o    such holder is not entitled to a share in the profits of an enterprise
          that is effectively managed in The Netherlands, other than stemming
          from securities or through an employment contract, the ordinary shares
          being attributable to such an enterprise; and

     o    such holder does not perform other activities in respect of the shares
          in the Netherlands (including without limitation activities that are
          beyond the scope of normal investment activities).

    The exchange of ADSs for ordinary shares will not, for Netherlands tax
purposes, be regarded as a taxable event, provided beneficiary rights have not
or the position of the shares among the assets of the holder has not changed.

         Residents of the Netherlands

    Where the ordinary shares or ADSs are owned by an individual or entity
resident or deemed resident in the Netherlands, the question whether
distribution and/or capital gains on such ordinary shares or ADSs are subject to
Netherlands income tax or corporate income tax depends on the general tax status
of the individual or the entity in question, the capacity in which he or it owns
such ordinary shares or ADSs, the percentage of interest in our capital owned by
him or it, and on certain other facts and circumstances. Generally, dividend
withholding tax with respect to distributions made by us will be creditable
against Netherlands income tax or corporate income tax, or will be recoverable.

    Under the new personal income tax regime as of January 1, 2001, individual
shareholders that are residents of The Netherlands and are holding the shares or
ADSs as investment (for tax purposes) will annually be taxed at the rate of 30
percent on an assumed yield of four percent of the market value of the shares
(based on a calculation method prescribed by law).

    Netherlands Gift, Estate and Inheritance Taxes

    The acquisition of ordinary shares or ADSs as a gift or as a result of the
death of a holder will not be subject to Netherlands gift, estate or inheritance
taxes, provided that:

     o    the donor or decedent was not a resident or a deemed resident of The
          Netherlands and did not hold the ordinary shares or ADSs in connection
          with the conduct of business through a permanent establishment or via
          a permanent representative in The Netherlands;

     o    in the case of a gift of ordinary shares or ADSs by an individual who
          at the date of the gift, was not resident or deemed to be resident in
          The Netherlands, such individual does not die within 180 days after
          the date of the gift, while being resident or deemed to be resident in
          The Netherlands; and

     o    if the donor or decedent was a citizen of The Netherlands, he or she
          was not resident or deemed to be resident in The Netherlands during
          the preceding 10 years.

The United States and The Netherlands have entered into an estate tax convention
that provides rules for reconciling the estate tax systems of the two countries
in circumstances where property otherwise would be subject to taxation in both
countries.

    Other Netherlands Taxes and Duties

    Save for capital tax which we will pay, no registration tax, transfer tax,
stamp duty or other similar documentary tax or duty will be due in The
Netherlands in connection with the subscription, issue, placement, allotment or
delivery of the ordinary shares or ADSs.

United States Taxation

    The following is a summary of the material U.S. federal income tax
considerations regarding the purchase, ownership and disposition of ordinary
shares or ADSs if you are an eligible U.S. holder. You are an eligible U.S.
holder if you are a resident of the United States for purposes of the Treaty and
are fully eligible for benefits under the Treaty. You generally will be entitled
to Treaty benefits if you are:

     o    the beneficial owner of the ordinary shares or ADSs (and of the
          dividends paid with respect to the ordinary shares or ADSs);

     o    an individual resident of the United States, a U.S. corporation, or a
          partnership, estate or trust to the extent your income is subject to
          taxation in the United States in your hands or in the hands of your
          partners or beneficiaries;

     o    not resident in The Netherlands for Netherlands tax purposes; and

     o    not subject to an anti-treaty shopping rule.

    You generally will not be eligible for Treaty benefits, and therefore will
not be an eligible U.S. holder, if you hold the ordinary shares or ADSs in
connection with the conduct of business through a permanent establishment, or
the performance of services through a fixed base, in The Netherlands, or you are
not resident in the United States for U.S. tax purposes.

    The summary does not purport to be a comprehensive description of all of the
tax considerations that may be relevant to an investment in our ordinary shares
or ADSs. In particular, the summary does not address considerations that may be
applicable to you if you do not hold ordinary shares or ADSs as capital assets,
are a taxpayer subject to special tax rules, such as a bank, tax-exempt entity,
insurance company, a regulated investment company, a pension fund, a real estate
investment trust, a dealer in securities or currencies, a person that holds
ordinary shares or ADSs as part of an integrated investment (including a
"straddle") comprised of ordinary shares or ADSs and one or more other
positions, and a person that owns or is deemed to own more than ten percent of
any class of our stock. The summary is based on laws, treaties and regulatory
interpretations in effect on the date of this annual report, all of which are
subject to change. You should consult your own advisers regarding the tax
consequences of an investment in the ordinary shares or ADSs in light of your
particular circumstances, including the effect of any state, local or other
national laws.

    For U.S. federal income tax purposes and for purposes of the Treaty,
beneficial owners of ADSs will be treated as the owners of the underlying
ordinary shares represented by those ADSs.

    Taxation of Dividends

    The gross amount of dividends distributed by us (including amounts withheld
in respect of Netherlands withholding tax) generally will be subject to U.S.
federal income taxation as foreign source dividend income, and will not be
eligible for the dividends received deduction. Dividends paid in Euros will be
included in income in a U.S. dollar amount calculated by reference to the
exchange rate in effect on the date of receipt by you (or by the depositary in
the case of ADSs). Subject to exceptions for positions that are hedged or held
for less than 60 days, an individual US holder generally will be subject to US
taxation at a maximum rate of 15% in respect of dividends received after 2002
and before 2009.

    If such dividends are converted into U.S. dollars on the date of receipt,
you generally should not be required to recognize foreign currency gain or loss
in respect of the dividend income. If you receive a Treaty refund, you may be
required to recognize foreign currency gain or loss to the extent the U.S.
dollar equivalent of the Treaty refund on the date the refund is received by you
differs from the U.S. dollar equivalent of the refund amount on the date the
dividends were received.

Subject to generally applicable limitations and to the special considerations
discussed below, Netherlands withholding tax at the 15 percent Treaty rate will
be treated as a foreign income tax that is eligible for credit against your U.S.
federal income tax liability or, at your election, may be deducted in computing
taxable income. Foreign tax credits will not be allowed for withholding taxes
imposed in respect of certain short-term or hedged positions and arrangements in
which your expected economic profit, after non-U.S. taxes, is insubstantial. You
should consult your own advisers concerning the implications of these rules in
light of your particular circumstances.

    Taxation of Capital Gains

    Gain or loss realized by you on the sale or other disposition of ordinary
shares or ADSs will be capital gain or loss in an amount equal to the difference
between your basis in the ordinary shares or ADSs and the amount realized on the
disposition (or its dollar equivalent, determined at the spot rate on the date
of disposition, if the amount realized is denominated in a foreign currency).
The gain or loss will be long-term gain or loss if the ordinary shares or ADSs
were held for more than one year. If you are an individual, the net amount of
long-term capital gain realized by you generally is subject to taxation at a
maximum rate of 20 percent; however, net long-term capital gain recognized after
May 5, 2003 and before 2009 generally is subject to taxation at a maximum rate
of 15%.

    U.S. Backup Withholding Tax and Information Reporting

    Payments in respect of the ordinary shares or ADSs that are made in the
United States or by a U.S.-related financial intermediary will be subject to
information reporting and may be subject to backup withholding unless you:

     o    are a corporation or other exempt recipient, or

     o    provide an IRS Form W-9 or an acceptable substitute form, certifying
          your taxpayer identification number and that no loss of exemption from
          backup withholding has occurred.

     If you are not a U.S.-resident please consult your local tax lawyer whether
and to what extent you are entitled by Treaty to a reduction in the rate of
withholding tax or an exemption of these rules.



<PAGE>


                              DOCUMENTS ON DISPLAY

    We are subject to the information requirements of the U.S. Securities
Exchange Act of 1934, as amended, and in accordance therewith are required to
file reports, including annual reports on Form 20-F, and other information with
the U.S. Securities Exchange Commission. These materials, including this annual
report on Form 20-F and the exhibits hereto, may be inspected and copied, upon
payment of a duplicating fee, at the Commission's public reference rooms in
Washington, D.C., New York, New York and Chicago, Illinois. Please call the
Commission at +1-800-SEC-0330 for further information on the public reference
rooms. Any filings we make electronically will be available to the public over
the Internet at the Commission's web site at http://www.sec.gov.

    The following documents are available for inspection during regular business
hours at our principal executive office and at the offices of our paying agent,
ABN AMRO Bank N.V.:

     o    our latest published annual report and our most recent publicly
          released financial statements; and

     o    our articles of association.

    We will furnish, upon request without charge, a copy of any of these
documents.

    You can reach us for this purpose at:

         New Skies Satellites N.V.
         Rooseveltplantsoen 4
         2517 KR
         The Hague
         The Netherlands

    You can reach ABN AMRO Bank N.V. for this purpose at +31-76-579-9455.

    These documents are also available from the SEC.



ITEM 11.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

    For a discussion of quantitative and qualitative disclosures about market
risk, see Item 5 "Operating and Financial Review and Prospects--Disclosures
About Market Risk".



ITEM 12.  DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

    Not applicable.



                                     PART II

ITEM 13.  DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES

    None.


<PAGE>


ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF
PROCEEDS

Use of Proceeds

    We received net proceeds of $255.9 million from our initial public offering
on October 10, 2000 and the exercise of the underwriter's over-allotment option.
We used $22.0 million to repay amounts outstanding under the promissory note
held by INTELSAT in 2000 and the remainder $233.9 million on satellite milestone
payments for the construction and launch contracts for NSS-7, NSS-6 and NSS-8.



ITEM 15.   DISCLOSURE CONTROLS AND PROCEDURES

    Within the 90 days prior to the date of this report, the Company carried out
an evaluation under the supervision and with the participation of the Company's
management, including the Chief Executive Officer and Chief Financial Officer,
of the effectiveness of the design and operation of the Company's disclosure
controls and procedures. There are inherent limitations to the effectiveness of
any system of disclosure controls and procedures, including the possibility of
human error and the circumvention or overriding of the controls and procedures.
Accordingly, even effective disclosure controls and procedures can only provide
reasonable assurance of achieving their control objectives. Based upon and as of
the date of the Company's evaluation, the Chief Executive Officer and Chief
Financial Officer concluded that the disclosure controls and procedures are
effective in all material respects to ensure that information required to be
disclosed in the reports the Company files and submits under the Exchange Act is
recorded, processed, summarized and reported as and when required.


ITEM 16.  [RESERVED]

                                    PART III

ITEM 17.  FINANCIAL STATEMENTS

    See Item 18 "Financial Statements".



ITEM 18.  FINANCIAL STATEMENTS

    See attached pages F-1 to F-19.



ITEM 19.  EXHIBITS

       Exhibit Number        Description
       --------------        -----------

              (1)           Articles of Association of the Registrant (including
                            an English translation thereof).

              (2)*          Form of Deposit Agreement.

              (4.1)*        $300 million multi-currency loan agreement between
                            New Skies Satellites N.V. and ABN AMRO Bank N.V. as
                            Arranger, Agent and Original Lender and the banks
                            named therein.

              (4.2)*        Subscription Agreement between New Skies Satellites
                            N.V. and the International Telecommunications
                            Satellite Organization, dated November 30, 1998.

              (4.3)*        Ensured Capacity Rights Contract between New Skies
                            Satellites N.V. and the International
                            Telecommunications Satellite Organization, dated
                            November 30, 1998.

              (4.4)*        Transponder Leasing Agreement between New Skies
                            Satellites N.V. and the International
                            Telecommunications Satellite Organization, dated
                            November 30, 1998.

              (4.5)*        Option Agreement Regarding the Issuance and
                            Subscription of Preference Shares in the Share
                            Capital of New Skies Satellites N.V.

              (4.6)**       Satellite Launch and In-Orbit Insurance Agreement,
                            between New Skies Satellite N.V. and International
                            Space Brokers, dated November 23, 1998, policy
                            number 893/AF982414, and the Endorsement thereto,
                            dated December 17, 2001.(1)

              (4.7)         Amendment No. 2 dated February 12, 2003 to Contract
                            No. NSS-20-03-01 for NSS-8 Spacecraft and Associated
                            Equipment and Services between Boeing Satellite
                            Systems International, Inc. and New Skies Satellites
                            N.V. dated as of March 21, 2001.(1)

              (4.8)         Amendment No. 3 dated May 6, 2003 to Contract No.
                            NSS-20-03-01 for NSS-8 Spacecraft and Associated
                            Equipment and Services between Boeing Satellite
                            Systems International, Inc. and New Skies Satellites
                            N.V. dated as of March 21, 2001.(1)

              (4.9)         Employment Agreement between Daniel S. Goldberg and
                            New Skies Satellites, N.V. dated April 23, 2002.

              (8)           Significant Subsidiaries.

              (99)          Certification pursuant to Section 906 of the
                            Sarbanes-Oxley Act of 2002.

----------

*    Exhibits to the registrant's Registration Statement on Form F-1 (No.
     333-12564) filed September 19, 2000 under the Securities Act of 1933, as
     amended, hereby incorporated by reference in this annual report.

**   Exhibits to the registrant's Annual Report on Form 20-F filed July 1, 2002
     under the Exchange Act of 1934, as amended, hereby incorporated by
     reference in this annual report.

(1)  Portions of this Exhibit have been omitted pursuant to a request for
     confidential treatment filed with the Commission under 17 C.F.R.
     ss.200.80(b).


<PAGE>


                                   SIGNATURES

The registrant hereby certifies that it meets all of the requirements for filing
on Form 20-F and that it has duly caused and authorized the undersigned to sign
this annual report on its behalf.


                                               New Skies Satellites N.V.

                                                     (Registrant)


                                          By: /s/ Mary Dent
                                          Name:  Mary Dent
                                          Title: General Counsel and
                                                 Member of the Management Board


June 30, 2003


<PAGE>


                                 CERTIFICATIONS

I, Daniel Goldberg, certify that:

1. I have reviewed this annual report on Form 20-F of New Skies Satellites N.V.;

2. Based on my knowledge, this annual report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this annual
report;

3. Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this annual report;

4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

     a.   designed such disclosure controls and procedures to ensure that
          material information relating to the registrant, including its
          consolidated subsidiaries, is made known to us by others within those
          entities, particularly during the period in which this annual report
          is being prepared;

     b.   evaluated the effectiveness of the registrant's disclosure controls
          and procedures as of a date within 90 days prior to the filing date of
          this annual report (the "Evaluation Date"); and

     c.   presented in this annual report our conclusions about the
          effectiveness of the disclosure controls and procedures based on our
          evaluation as of the Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent function):

     a.   all significant deficiencies in the design or operation of internal
          controls which could adversely affect the registrant's ability to
          record, process, summarize and report financial data and have
          identified for the registrant's auditors any material weaknesses in
          internal controls; and

     b.   any fraud, whether or not material, that involves management or other
          employees who have a significant role in the registrant's internal
          controls; and

6. The registrant's other certifying officers and I have indicated in this
annual report whether or not there were significant changes in internal controls
or in other factors that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.


Date: June 30, 2003
                                               /s/ Daniel Goldberg
                                               -------------------------------
                                               Title: Chief Executive Officer


<PAGE>


I, Andrew Browne, certify that:

1. I have reviewed this annual report on Form 20-F of New Skies Satellites N.V.;

2. Based on my knowledge, this annual report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this annual
report;

3. Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this annual report;

4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

     a.   designed such disclosure controls and procedures to ensure that
          material information relating to the registrant, including its
          consolidated subsidiaries, is made known to us by others within those
          entities, particularly during the period in which this annual report
          is being prepared;

     b.   evaluated the effectiveness of the registrant's disclosure controls
          and procedures as of a date within 90 days prior to the filing date of
          this annual report (the "Evaluation Date"); and

     c.   presented in this annual report our conclusions about the
          effectiveness of the disclosure controls and procedures based on our
          evaluation as of the Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent function):

     a.   all significant deficiencies in the design or operation of internal
          controls which could adversely affect the registrant's ability to
          record, process, summarize and report financial data and have
          identified for the registrant's auditors any material weaknesses in
          internal controls; and

     b.   any fraud, whether or not material, that involves management or other
          employees who have a significant role in the registrant's internal
          controls; and

6. The registrant's other certifying officers and I have indicated in this
annual report whether or not there were significant changes in internal controls
or in other factors that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.

Date: June 30, 2003
                                                 /s/ Andrew Browne
                                                 -------------------------------
                                                 Title: Chief Financial Officer


<PAGE>


Index to Consolidated Financial Statements

                                                                           Page


Independent Auditors' Report                                               F-2

Consolidated Balance Sheets as of December 31, 2002 and 2001               F-3

Consolidated Statements of Operations for the Years Ended
December 31, 2002, 2001 and 2000                                           F-4

Consolidated Statements of Shareholders' Equity for the Years Ended
December 31, 2002, 2001 and 2000                                           F-5

Consolidated Statements of Cash Flows for the Years Ended
December 31, 2002, 2001 and 2000                                           F-6

Notes to the Consolidated Financial Statements                             F-7



<PAGE>


                          Independent Auditors' Report

To the Supervisory Board of Directors and Shareholders
   of New Skies Satellites N.V.:

We have audited the consolidated balance sheets of New Skies Satellites N.V. and
subsidiaries (the "Company") as of December 31, 2002 and 2001, and the related
consolidated statements of operations, shareholders' equity, and cash flows for
each of the three years in the period ended December 31, 2002. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on the financial statements based on our
audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, such financial statements present fairly, in all material
respects, the financial position of New Skies Satellites N.V. and subsidiaries
as of December 31, 2002 and 2001, and the results of their operations and their
cash flows for each of the three years in the period ended December 31, 2002 in
conformity with accounting principles generally accepted in the United States of
America.

As discussed in Note 2 to the financial statements, the Company changed its
method of accounting for goodwill in 2002.


/s/ Deloitte & Touche Accountants
Amsterdam, The Netherlands
January 24, 2003


<PAGE>


New Skies Satellites N.V. and subsidiaries

Consolidated balance sheets
(In thousands of U.S. dollars, except share data)
<TABLE>
<CAPTION>

                                                                                         December 31,
                                                                                     2002           2001
                                                                                  -----------    -----------
<S>                                                                               <C>            <C>
Assets
Current assets
Cash and cash equivalents                                                         $     8,329    $   138,268
Trade receivables (including trade receivables from shareholders
    totaling $22,100 in 2002 and $25,321 in 2001 less: allowance for
    doubtful accounts of $6,171 for 2002 and $4,948 for 2001)                          39,109         41,981
Prepaid expenses and other assets                                                      10,885          9,139
                                                                                  -----------    -----------
Total current assets                                                                   58,323        189,388

Communications, plant and other property, net (Note 4)                              1,058,119        886,244
Deferred tax asset (Note 6)                                                            10,087         11,441
Goodwill, net and other assets (Note 2)                                                 1,226         22,730
                                                                                  -----------    -----------
TOTAL                                                                             $ 1,127,755    $ 1,109,803
                                                                                  ===========    ===========

Liabilities and shareholders' equity

Current liabilities
Short-term debt                                                                   $    10,000$             -
Accounts payable and accrued liabilities                                               18,396         20,350
Income taxes payable                                                                   29,124         22,357
Deferred revenues                                                                       8,994          8,848
Satellite performance incentives                                                        6,218          4,610
                                                                                  -----------    -----------
Total current liabilities                                                              72,732         56,165

Deferred revenues and other liabilities                                                 8,351          3,925
Satellite performance incentives                                                       27,639         12,529
                                                                                  -----------    -----------
Total liabilities                                                                     108,722         72,619
                                                                                  -----------    -----------

Shareholders' equity (Note 8)
Governance preference shares (227,530,000 shares authorized, par value
    (euro)0.05; none issued)                                                                -              -
Cumulative preferred financing shares (22,753,000 shares
authorized, par value(euro)0.05; none issued)                                               -              -
Ordinary Shares (204,777,000 shares authorized, par value(euro)0.05;
    130,570,241 shares issued)                                                          6,026          6,026
Additional paid-in capital                                                            977,506        976,168
Retained earnings                                                                      56,019         60,664
Unearned compensation (Note 10)                                                          (685)          (352)
Accumulated other comprehensive loss                                                     (492)        (5,322)
Treasury stock, at cost (5,194,030 ordinary shares)                                   (19,341)             -
                                                                                  -----------    -----------
Total shareholders' equity                                                          1,019,033      1,037,184
                                                                                  -----------    -----------
TOTAL                                                                             $ 1,127,755    $ 1,109,803
                                                                                  ===========    ===========
</TABLE>



See notes to consolidated financial statements.


<PAGE>


New Skies Satellites N.V. and subsidiaries

Consolidated statements of operations
(In thousands of U.S. dollars, except per share amounts)
<TABLE>
<CAPTION>


                                                                          Years ended December 31,
                                                                  2002              2001             2000
                                                              ----------------  --------------- ----------------
<S>                                                               <C>              <C>              <C>
Revenues
    (including services to shareholders totaling $108,346
    in 2002, $101,916 in 2001 and $117,999 in 2000) (Note 9)  $     200,524     $    209,028    $     198,294
                                                              ----------------  --------------- ----------------

Operating expenses
Cost of operations (including services received from
    shareholders totaling $12,031 in 2000)                           50,714           51,533           47,022
Selling, general and administrative                                  39,490           38,733           34,765
Depreciation and amortization                                        80,574           75,338           69,870
                                                              ----------------  --------------- ----------------
Total operating expenses                                            170,778          165,604          151,657
                                                              ----------------  --------------- ----------------

Operating income                                                     29,746           43,424           46,637

Interest expense (income) and other, net                                510           (9,008)          (2,543)
                                                              ----------------  --------------- ----------------
Income before income tax expense                                     29,236           52,432           49,180

Income tax expense (Note 6)                                         (10,506)         (19,364)         (17,506)
                                                              ----------------  --------------- ----------------

Income before cumulative effect of change in                         18,730           33,068           31,674
    accounting principle
Cumulative effect of change in accounting principle,
    relating to goodwill, net of taxes                              (23,375)              -                -

                                                              ----------------  --------------- ----------------
Net (loss) income                                             $      (4,645)    $     33,068    $      31,674
                                                              ================  =============== ================



Basic and diluted earnings per share:

Income before cumulative effect of change in accounting
    principle                                                 $        0.14     $        0.25   $        0.29
Cumulative effect of change in accounting principle                   (0.18)              -                -
                                                              ----------------  --------------- ----------------
Basic and diluted earnings per share                          $       (0.04)    $       0.25    $        0.29
                                                              ================  =============== ================
</TABLE>



See notes to consolidated financial statements.


<PAGE>

<TABLE>
<CAPTION>


                   New Skies Satellites N.V. and subsidiaries
                 Consolidated statements of shareholders' equity
                  Years ended December 31, 2002, 2001 and 2000
                (In thousands of U.S. dollars, except share data)
------------------------------------------------------------------------------------------------------------------------------------
                                                                                                Accumulated
                                    Number of              Additional    Retained                  Other     Treasury    Total
                                    Ordinary    Ordinary     Paid-in     Earnings    Unearned  Comprehensive  Stock   Shareholders'
                                     Shares      Shares      Capital     (Deficit) Compensation    Loss     (at Cost)    Equity
                                   ----------- ---------- ------------- ---------- ----------- ----------- ------------ ------------
                                 (in thousands)
<S>                                  <C>           <C>    <C>          <C>       <C>         <C>            <C>         <C>

Balance, January 1, 2000             100,285   $   5,110  $   718,542   $  (4,078) $    (413)  $        -  $       -    $   719,161

Ordinary shares issued                30,276       1,329      254,531           -          -            -          -        255,860
Adjustment in par value of
ordinary shares
  (Note 8)                                 -        (413)         413           -          -            -          -              -
Unearned stock compensation                            -        2,691           -     (2,691)           -          -              -
Amortization of unearned
  stock compensation                       -                        -           -      1,757            -          -          1,757
Cumulative translation adjustment          -           -            -           -          -       (2,895)         -         (2,895)
Net income                                 -           -            -      31,674          -            -          -         31,674
                                   ----------- ---------- ------------- ---------- ----------- ----------- ------------ ------------
Balance, December 31, 2000           130,561       6,026      976,177       27,596    (1,347)      (2,895)         -      1,005,557

Stock options exercised (Note 10)          9           -           67           -          -            -          -             67
Stock option forfeiture                    -           -          (23)                    23            -          -              -
Amortization of unearned
  stock compensation                       -           -            -           -        972            -          -            972
Cumulative translation adjustment          -           -            -           -          -       (2,427)         -         (2,427)
Net income                                             -            -      33,068          -            -          -         33,068
Other                                      -           -          (53)          -          -            -          -            (53)
                                   ----------- ---------- ------------- ---------- ----------- ----------- ------------ ------------
Balance, December 31, 2001           130,570       6,026      976,168       60,664      (352)      (5,322)         -      1,037,184

Unearned stock compensation                -           -        1,338           -     (1,338)           -          -              -
Amortization of unearned
  stock compensation                       -           -            -           -      1,005            -          -          1,005
Purchase of treasury stock                 -           -            -           -          -            -    (19,341)       (19,341)
Cumulative translation adjustment          -           -            -           -          -        4,830          -          4,830
Net loss                                   -           -            -      (4,645)         -            -          -         (4,645)
                                   ----------- ---------- ------------- ---------- ----------- ----------- ------------ ------------
Balance, December 31, 2002           130,570   $   6,026  $   977,506   $   56,019 $    (685)  $     (492)  $(19,341)   $ 1,019,033
                                   =========== ========== ============= ========== =========== ========== ============ =============
</TABLE>

See notes to consolidated financial statements.


<PAGE>



New Skies Satellites N.V. and subsidiaries

Consolidated statements of cash flows
(In thousands of U.S. dollars)

<TABLE>
                                                                            Years Ended December 31,
                                                                     2002             2001            2000
                                                                ----------------  -------------- -----------------
<S>                                                             <C>               <C>            <C>
Cash flows from operating activities:
Net (loss) income                                               $       (4,645)   $     33,068   $        31,674

Adjustments for non-cash items:
   Depreciation and amortization                                        80,574          75,338            69,870
   Cumulative effect of change in accounting principle                  23,375             -                 -
   Deferred taxes                                                        1,354           1,382             4,943
   Amortization of unearned stock compensation                           1,005             972             1,757

Changes in operating assets and liabilities:
   Trade receivables                                                     2,981           4,940            (7,932)
   Prepaid expenses and other                                           (1,727)         (1,855)              800
   Accounts payable and accrued liabilities                             (2,096)           (321)            9,291
   Deferred revenues                                                     4,501            (129)            2,288
   Income taxes payable                                                  6,668          17,296             5,170
                                                                ----------------  -------------- -----------------
Net cash provided by operating activities                              111,990         130,691           117,861
                                                                ----------------  -------------- -----------------

Cash flows from investing activities:
   Payments for communications, plant and other
     property                                                         (231,400)       (274,167)         (118,480)
   Reimbursement of KTV constructions costs                                -            51,452               -
   Acquisition of business                                                 -               -             (30,462)
                                                                ----------------  -------------- -----------------
Net cash used in investing activities                                 (231,400)       (222,715)         (148,942)
                                                                ----------------  -------------- -----------------

Cash flows from financing activities:
   Ordinary shares issued                                                  -               -             255,860
   Stock options exercised                                                 -                67               -
   Proceeds of note payable and short-term borrowings                   10,000             -              20,000
   Purchases of treasury stock                                         (19,341)            -                 -
   Repayment of note payable and short-term
     borrowings                                                            -               -             (42,000)
   Satellite performance incentives and other                           (1,297)         (2,553)           (3,392)
                                                                ----------------  -------------- -----------------
Net cash (used in) provided by financing activities                    (10,638)         (2,486)          230,468
                                                                ----------------  -------------- -----------------

Effect of exchange rate differences                                        109            (120)             (551)
                                                                ----------------  -------------- -----------------

Net change in cash and cash equivalents                               (129,939)        (94,630)          198,836
Cash and cash equivalents, beginning of year                           138,268         232,898            34,062
                                                                ----------------  -------------- -----------------
Cash and cash equivalents, end of year                          $        8,329    $    138,268   $       232,898
                                                                ================  ============== =================

</TABLE>


See notes to consolidated financial statements.

Cash payments for interest (net of amounts capitalized) were $0.9 million for
the years ended December 31, 2000. Income taxes paid amounted to $2.1 million
and $0.8 million for the years ended December 31, 2002 and 2001, respectively.


<PAGE>


New Skies Satellites N.V. and subsidiaries

Notes to consolidated financial statements
Years ended December 31, 2002, 2001 and 2000



1. Basis of presentation

Business description - New Skies Satellites N.V. (the "Company") is an
independent, global satellite communications company. The Company owns and
operates six satellites in geosynchronous orbit that provide capacity to various
entities throughout the world for the global public telecommunications,
broadcasting, Internet and corporate business network market sectors. During
2002, two satellites were launched, the NSS-6 and NSS-7, and the NSS-K was
retired. As the NSS-6 was launched in the fourth quarter of 2002 it is expected
to enter commercial service in the first quarter of 2003. A further satellite,
the NSS-8, is currently under construction, with a projected launch date in the
fourth quarter of 2004.

Formation and asset transfer - The Company was formed on April 23, 1998 as a
corporation organized under the laws of The Netherlands, with headquarters in
The Hague, through the issuance of 90 million shares of common stock to
International Telecommunications Satellite Organization ("INTELSAT") for 9.0
million Dutch Guilders (or approximately $4.6 million) to carry on the satellite
communication business associated with the satellites contributed by INTELSAT.
The Company and INTELSAT then entered into a subscription agreement (the
"Subscription Agreement"). Under the Subscription Agreement dated November 30,
1998 INTELSAT received an additional 10 million of the Company's shares and in
exchange, the Company received certain assets including five in-orbit satellites
and assumed certain liabilities (the "Asset Transfer"). Immediately after the
Asset Transfer, INTELSAT distributed 90 percent of its shares in the Company to
its investment shareholders. Following distribution of these shares, INTELSAT
held 10 percent of the stock through a passive, non-voting trust and no longer
controlled the Company. In February 2000, INTELSAT distributed the remaining
shares to its investment shareholders.

At the Asset Transfer, the Company and INTELSAT also entered into various other
agreements including a space segment capacity, a satellite communications
services and a transition services agreement. For the years ended December 31,
2001 and 2000, $4.1 million and $12.0 million, respectively, of operating
expenses were incurred under the terms of these agreements which have since
expired.

INTELSAT also leased from the Company space segment capacity to fulfill the
needs of certain INTELSAT contracts. During the years ended December 31, 2001
and 2000, approximately 9 percent and 15 percent, respectively, of the Company's
revenues were derived from these lease agreements. On January 16, 2002 INTELSAT
assigned all of these remaining lease agreements to the Company.


2. Summary of significant accounting policies

Functional currency - The Company's revenues, capital expenditures and
substantially all operating expenses are denominated in U.S. dollars.
Accordingly, the U.S. dollar has been adopted as the functional currency.
Transactions in other currencies are translated into U.S. dollars using rates
that are in effect at the transaction date.

Principles of consolidation - The consolidated financial statements include the
accounts of the Company and its wholly owned domestic and foreign subsidiaries.
All significant intercompany balances and transactions have been eliminated in
consolidation.

Foreign currency translation - Assets and liabilities of foreign subsidiaries
are translated into U.S. dollars at exchange rates prevailing at the balance
sheet date. Revenues and costs relating to the operations of such subsidiaries
are translated at average exchange rates during the period. Resulting
translation adjustments are directly recorded in shareholders' equity as a
component of accumulated other comprehensive loss.

Use of estimates - The preparation of financial statements requires management
to make estimates and assumptions that affect: (1) the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and (2) the reported amounts of expenses
during the reporting period. Actual results could differ from those estimates.

Revenue recognition - Telecommunications revenue results from utilization
charges that are recognized as revenue on a straight-line basis over the period
during which the satellite services are provided. Deferred revenues represent
the unearned balances remaining from amounts received from customers pursuant to
transponder lease prepayment options. These amounts are recorded as revenues on
a straight-line basis over the respective lease terms.

Cash and cash equivalents - The Company considers temporary investments with
original maturities of three months or less when purchased to be cash
equivalents.

Communications, plant and other property - Communications, plant and other
property are carried at cost and consist primarily of the costs of spacecraft
construction and launch, including capitalized performance payments, insurance
premiums, capitalized interest, and costs directly associated with monitoring
and support of spacecraft construction. Interest expense in the accompanying
statements of operations is net of capitalized interest of $1.6 million, $1.4
million, and $2.7 million for the years ended December 31, 2002, 2001 and 2000,
respectively.

Upon commencement of commercial operation, communications, plant and other
property are depreciated on a straight-line basis over the following estimated
useful lives (see Note 4):

                                                      Years
                                          -------------------------------
Spacecraft and launch costs                            7-13
Communication support and other                        3-7
Buildings                                               30

Goodwill - The excess of the purchase price over the fair market value of net
assets acquired is recorded as goodwill and is tested for impairment at least on
an annual basis. See "Recently issued Accounting Standards".

Unsuccessful launches and satellite failures - In the event of an unsuccessful
launch or total in-orbit satellite failure, all unamortized costs that are not
recoverable under launch or in-orbit insurance are recorded as an operating
expense.

Impairment of long-lived assets - The Company periodically reviews its
long-lived assets, which are comprised primarily of its in-service satellite
fleet, to determine whether an impairment exists. Impairment can arise from
complete failure or partial failure of the satellites as well as a change in
expected cash flows. Such impairment tests are based on a comparison of
estimated undiscounted future cash flows to the recorded value of the asset. If
impairment is indicated, the asset value will be written down to fair value
based upon discounted cash flows, using an appropriate discount rate.

Satellite performance incentives - The Company has certain contracts with its
satellite manufacturers that require the Company to make incentive payments over
the orbital design life of the satellites. The Company records the present value
of such payments as a liability and capitalizes these costs in the cost of the
satellite.

Income taxes - The Company accounts for income taxes under the provisions of
Statement of Financial Accounting Standards ("SFAS") No. 109, Accounting for
Income Taxes. Under this method, deferred tax assets and liabilities are
recognized for the future tax consequences of temporary differences between the
carrying amounts and tax bases of assets and liabilities and net operating loss
carry-forwards using enacted rates. Valuation allowances are provided against
assets that are not likely to be realized.

Net earnings (loss) per share - Basic earnings (loss) per share is computed by
dividing net income (loss) by the weighted average ordinary shares outstanding.
Diluted earnings per share reflects the potential dilution that could occur if
options issued under New Skies stock option plans were exercised.

In 2002, the weighted average number of shares outstanding was 130.3 million.
Due to the net loss in that year, approximately 307,000 incremental common
shares relating to outstanding dilutive stock options have been excluded from
the calculation of diluted earnings per share due to their anti-dilutive effect.

A summary of the weighted average number of shares and incremental shares used
in the calculation of earnings per share for 2001 and 2000 follows:


                                                        Years ended December 31
                                                           (in thousands)
                                                    ---------------------------
                                                        2001            2000
                                                    -------------  ------------

     Basic weighted average shares outstanding         130,569        107,407
     Weighted average incremental shares                   141            691

                                                    -------------  ------------
     Adjusted weighted average shares outstanding      130,710        108,098
                                                    =============  ============

The difference in the weighted average number of shares outstanding and the
adjusted weighted average number of shares outstanding resulted in no difference
between basic and diluted earnings per share for 2001 and 2000.

Stock Compensation - SFAS No. 123, Accounting for Stock-Based Compensation,
encourages but does not require companies to record compensation cost for
stock-based employee compensation plans at fair value. For periods through
December 31, 2002 the Company has chosen to account for stock-based compensation
using the intrinsic value method prescribed in Accounting Principles Board
Opinion ("APB") No. 25, Accounting for Stock Issued to Employees, and related
interpretations and has adopted the disclosure-only provisions of SFAS No. 123.
Accordingly, compensation cost for stock options is measured as the excess, if
any, of the estimated fair market value of the Company's stock at the date of
the grant over the amount an employee must pay to acquire the stock. Effective
January 1, 2003 the Company will record compensation cost for options and other
forms of stock-based compensation issued subsequent to that date. See Note 10.

Fair Value of Financial Instruments - The Company's financial instruments
consist of accounts receivable, accounts payable, short-term debt and satellite
performance incentives. The current carrying amounts of such instruments are
considered reasonable estimates of the fair market value of these instruments
due to the short maturity of these items or as a result of the current market
interest rates accruing on these instruments.

Comprehensive Income - Comprehensive income includes net income (loss) and
translation adjustments that were recognized directly in equity. Translation
adjustments of $4.8 million, $(2.4) million and $(2.9) million for the years
ended December 31, 2002, 2001 and 2000, respectively, were incurred and
consequently comprehensive income in these years is equal to $0.2 million, $30.6
million and $28.8 million, respectively.

Recently Issued Accounting Standards - In June 2001, the Financial Accounting
Standards Board ("FASB") issued SFAS No. 143, Accounting for Asset Retirement
Obligations. SFAS No. 143 establishes accounting standards for the recognition
and measurement of legal obligations associated with the retirement of tangible
long-lived assets and requires recognition of a liability for an asset
retirement obligation in the period in which it is incurred. The provisions of
this statement are effective for financial statements issued for fiscal years
beginning after June 15, 2002. The Company does not anticipate that the adoption
of SFAS No. 143 will have a material impact on the consolidated financial
statements.

As of January 1, 2002 the Company adopted SFAS No. 144, Accounting for the
Impairment or Disposal of Long-Lived Assets. This statement defines the
accounting and reporting for the impairment and disposal of long-lived assets
and is effective for the Company on January 1, 2002. Adopting SFAS No. 144 did
not have a material impact on the consolidated financial statements.

As of January 1, 2002, the Company adopted SFAS No. 145, Rescission of SFAS No.
4, 44, 64, Amendment of SFAS No. 13, and Technical Corrections. SFAS No. 4,
which was amended by SFAS No. 64, required all gains and losses from the
extinguishment of debt to be aggregated and, if material, classified as an
extraordinary item, net of related income tax effect. As a result, the criteria
in Opinion No. 30 will now be used to classify those gains and losses. The
provisions of this statement are effective for financial statements issued for
fiscal years beginning after December 15, 2002. The Company does not anticipate
that the adoption of SFAS No. 145 will have a material impact on the
consolidated financial statements.

As of January 1, 2002, the Company adopted SFAS No. 142, Goodwill and Other
Intangible Assets. This Statement eliminates goodwill amortization from the
Consolidated Statement of Operations and requires an evaluation of goodwill for
impairment upon adoption of this Statement, as well as subsequent evaluations on
an annual basis, and more frequently if circumstances indicate a possible
impairment. Upon adoption of SFAS No. 142, the Company performed a transitional
impairment test on the goodwill resulting from the purchase of New Skies
Networks Pty Limited (see Note 3). As a result of this impairment test, the
Company recorded an impairment charge of $23.4 million, which is classified as a
cumulative effect of a change in accounting principle. Changes in the carrying
amount of goodwill were as follows:

(in thousands of U.S. dollars)
       Balance at December 31, 2000                   $      26,135
       Amortization                                          (2,760)
                                                      ---------------

       Balance at December 31, 2001                          23,375
       Impairment loss                                      (23,375)
                                                      ---------------

       Balance at December 31, 2002                   $          -
                                                      ===============

The reconciliation of reported net (loss) income and earnings per share to
adjusted net (loss) income and earnings per share for the years ended December
31, 2002, 2001 and 2000 was as follows:


<TABLE>
<CAPTION>

(in thousands of U.S. dollars, except per share amounts)       2002                2001               2000
                                                         ------------------   ----------------  -----------------
<S>                                                      <C>                  <C>               <C>
Net (loss) income, as reported                           $        (4,645)     $       33,068    $        31,674
Add: Goodwill amortization                                             -               2,760              1,494
                                                         ------------------   ----------------  -----------------

Adjusted net (loss) income                               $        (4,645)     $       35,828    $        33,168
                                                         ==================   ================  =================


Basic and diluted earnings per share, as reported        $         (0.04)     $         0.25    $          0.29
Add: Goodwill amortization                                             -                0.02               0.02
                                                         ------------------   ----------------  -----------------
Adjusted basic and diluted earnings per share            $         (0.04)     $         0.27    $          0.31
                                                         ==================   ================  =================
</TABLE>

Upon adoption of SFAS No. 142, the transition provisions of SFAS No. 141,
Business Combinations, also became effective. These transition provisions
specify criteria for determining whether an acquired intangible asset should be
recognized separately from goodwill. Adopting SFAS No. 141 did not have a
material impact on the consolidated financial statements.

In June 2002, the FASB issued SFAS No. 146, Accounting for Costs Associated with
Exit or Disposal Activities. This statement defines the accounting and reporting
for costs associated with exit or disposal activities and is effective for exit
or disposal activities that are initiated after December 31, 2002. The Company
does not anticipate that the adoption of SFAS No. 146 will have a material
impact on the consolidated financial statements.

In December 2002, the FASB issued SFAS No. 148, Accounting for Stock-Based
Compensation - Transition and Disclosure. SFAS No. 148 establishes accounting
standards for the transition from accounting for stock-based compensation to
employees under the intrinsic value method under APB No. 25, Accounting for
Stock Issued to Employees to the fair value based method as defined by SFAS No.
123, Accounting for Stock-Based Compensation. The statement provides three
alternatives of transition, a prospective method, a modified prospective method
and a retroactive restatement method. Upon adoption of the fair value method in
2003, the Company will utilize the prospective method provided by SFAS No. 148.

In November 2002, the FASB issued Interpretation Number 45, Guarantor's
Accounting and Disclosure Requirements for Guarantees, Including Indirect
Guarantees of Indebtedness of Others ("FIN 45"). This interpretation requires
certain disclosures to be made by a guarantor in its interim and annual
financial statements about its obligations under certain guarantees that it has
issued. It also requires a guarantor to recognize, at the inception of a
guarantee, a liability for the fair value of the obligation undertaken in
issuing the guarantee. The disclosure requirements of FIN 45 are effective for
interim and annual periods after December 15, 2002. The adoption of FIN 45 did
not have a material impact on our consolidated financial statements.

In January 2003, the FASB issued FASB Interpretation No. 46, Consolidation of
Variable Interest Entities - an interpretation of ARB No. 51 ("FIN 46"). FIN 46
clarifies the application of Accounting Research Bulletin No. 51, Consolidated
Financial Statements, to certain entities in which equity investors do not have
the characteristics of a controlling financial interest or do not have
sufficient equity at risk for the entity to finance its activities without
additional subordinated financial support from other parties. FIN 46 is
effective for the first fiscal year or interim period beginning after June 15,
2003 to variable interest entities in which an enterprise holds a variable
interest that it acquired before February 1, 2003. We do not anticipate that the
adoption of FIN 46 will have a material impact on our consolidated financial
statements.

Presentation - Certain amounts reported in 2001 and 2000 have been reclassified
to conform to the 2002 financial statement presentation.

3. Acquisition of a business

On March 31, 2000, the Company acquired all of the outstanding shares of New
Skies Networks Pty Limited (formerly AAPT Sat-Tel Pty Limited) for cash
consideration of AUD $49.75 million ($30.5 million). New Skies Networks Pty Ltd
is a system integrator and network service provider, operating six teleports in
major Australian cities and providing Internet access services as well as
tracking, telemetry and control services to satellite operators. The acquisition
was accounted for as a purchase business combination. The results of New Skies
Networks Pty Ltd operations have been included with those of the Company from
March 31, 2000, the date of acquisition.

The acquired assets and liabilities were valued at fair market value on the date
of acquisition. The resulting goodwill amount was $27.6 million, and was being
amortized over a period of 10 years. In implementing SFAS No. 142, Goodwill and
Other Intangible Assets in 2002, the Company performed a transitional impairment
test on its goodwill. As a result of this impairment test which now requires the
primary evaluation to be performed on a discounted cash flow basis, the Company
recorded an impairment charge of $23.4 million, which is classified as a
cumulative effect of a change in accounting principle.



<PAGE>


The unaudited consolidated results of operations on a pro forma basis as though
New Skies Networks Pty Ltd had been acquired as of the beginning of 2000 are as
follows:


      Revenues                                                $      203,176,000
      Net income                                                      31,107,000
      Earnings per share - basic and diluted                                0.29


The pro forma financial information is presented for informational purposes only
and is not necessarily indicative of the operating results that would have
occurred had the New Skies Networks Pty Ltd acquisition been consummated as of
the beginning of 2000, nor are they necessarily indicative of future operating
results.


4. Communications, plant and other property

Communications, plant and other property consisted of the following:



(in thousands of U.S. dollars)                      December 31,
                                             2002                 2001
                                      --------------------   ------------------

Spacecraft and launch costs           $        1,002,083     $        884,259
Construction-in-progress                         395,976              447,816
Communication support and other                   71,547               59,657
Buildings                                         23,736               12,330
                                      --------------------   ------------------
                                               1,493,342            1,404,062
Less: accumulated depreciation                   435,223              517,818
                                      --------------------   ------------------
Total                                 $        1,058,119     $        886,244
                                      ====================   ==================

Construction-in-progress relates primarily to satellites under construction and
related launch services.


5. Contractual commitments

In further development and operation of the Company's global commercial
communications satellite system, significant additional expenditures are
anticipated. At December 31, 2002, the Company had a contract for the
construction, development and launch of the NSS-8 satellite, and pending final
acceptance of the NSS-6 satellite, future committed payments totaling $44.0
million and $42.2 million, for the years ending December 31, 2003 and 2004,
respectively. Additional commitments on these satellite programs ("satellite
performance incentives") totaling $40.0 million will fall due over the design
lives of these satellites to the extent that they continue to operate
successfully throughout this time.

The Company has recorded a liability of $33.9 million at December 31, 2002
representing the present value, at a weighted average discount rate of 5.2
percent, of the remaining satellite performance incentive payments on the
satellites which were in service at December 31, 2002 of $5.8 million, $5.9
million, $5.7 million, $3.9 million, $3.8 million and $15.4 million for payments
to be made in the years ending December 31, 2003, 2004, 2005, 2006, 2007, and
2008 and thereafter, respectively.



<PAGE>


Commitments as of December 31, 2002 for future payments under operating leases
primarily relating to telecommunication infrastructure and office facilities are
as follows (in thousands of U.S. dollars):



      2003                                                 $        15,038
      2004                                                          10,035
      2005                                                           2,122
      2006                                                           1,694
      2007                                                           1,281
      2008 and thereafter                                            3,295
                                                           -----------------
      Total commitments                                    $        33,465
                                                           =================



6. Income Taxes

The Company is currently in negotiations with the Dutch tax authorities to
determine the fair value (tax basis) of the assets contributed by INTELSAT.
While the final determination of the tax basis of these assets has not been
agreed, we have made a preliminary valuation of these assets. The difference
between the book and estimated tax bases of the contributed assets gives rise to
a deferred tax asset, which approximated $15.6 million at December 1, 1998, the
date of the Asset Transfer. To the extent that the final tax value of the
contributed assets differs from this estimate, a corresponding adjustment will
be made to the deferred tax asset and additional paid-in capital.

The Company's provision for income taxes consists of the following:
<TABLE>
<CAPTION>

(in thousands of U.S. dollars)              2002               2001               2000
                                      -----------------   ----------------  ------------------
<S>                                   <C>                 <C>                 <C>
Current domestic                      $        6,953      $      16,032       $      12,444
Current foreign                                2,207              1,950                 119
Deferred domestic                              1,346              1,382               4,943

                                      -----------------   ----------------  ------------------
Total income tax expense              $       10,506      $      19,364     $        17,506
                                      =================   ================  ==================
</TABLE>

The income tax expense is computed in the financial statements at 35.9 percent,
36.9 percent and 35.6 percent for the years ended December 31, 2002, 2001 and
2000, respectively, as compared with The Netherlands statutory rate of 34.5
percent for 2002 and 35 percent for 2001 and 2000. The Company's provision for
income taxes differs from the statutory rate by 1.4 percent, 1.9 percent and 0.6
percent for 2002, 2001 and 2000, respectively, due to the permanent differences
arising from certain non-deductible amounts.

Management believes that it is more likely than not that the results of future
operations will generate sufficient taxable income to realize the deferred tax
assets.

The deferred tax asset as of December 31, 2002 and 2001 consists of the tax
effect of the difference in the tax and book basis of communications, plant and
other property.


7. Financing arrangements

Available credit facility - The Company has an unsecured credit facility that
provides up to $300 million in available credit through December 31, 2004.
Borrowings under the facility bear interest at an adjustable rate, which as of
December 31, 2002 is 1.9 percent. A commitment fee of 0.225 percent is paid on
the unused revolving credit amount. As of December 31, 2002 $290 million of the
facility was unused and amounts outstanding under this facility as of December
31, 2002 totaled $10 million.


8. Change in share capital

In October 2002, the Supervisory Board authorized the purchase of up to 13
million ordinary shares. The Company purchased 5,194,030 shares in 2002 at an
average cost of $3.72 per share. The acquired shares are recorded as "Treasury
Stock" as a reduction of Shareholders' Equity.

On June 28, 2000, the Shareholders of the Company approved a ten-for-one
ordinary share split and a change in the currency denomination and par value of
the Company's ordinary shares, from NLG 1.00 to (euro)0.05. The stock split has
been given retroactive recognition in all periods presented in the accompanying
financial statements. In addition, the Shareholders approved the increase in the
number of authorized ordinary shares to 204,777,000 with a par value of
(euro)0.05. As a result of this change, $413,000 originally classified as
ordinary shares was reclassified as additional paid-in capital.

In addition, on June 28, 2000, the Shareholders authorized the issuance of one
class of preferred financing shares, par value (euro)0.05 per share, with a
total authorized amount of 22,753,000 shares. No shares of preferred stock have
been issued.

The Shareholders also authorized on June 28, 2000 the issuance of up to
227,530,000 governance preference shares at a par value of (euro)0.05 per share.
The Shareholders also approved in the Shareholders Meeting on the same date an
option right to an independent foundation (the "Foundation") to purchase
governance preference shares. Under this option, if certain preconditions are
satisfied, the Foundation may acquire up to the number of then outstanding
ordinary and financing preference shares at the time of the purchase, less one.
The shares will be issued at par upon a payment of 25 percent of the par value.
The object of the Foundation is to own and vote the Company's preference shares
in order to protect the interests of the Company and its ordinary shareholders.
No governance preference shares have been issued.


9. Significant customers

Certain shareholders are the principal customers of the Company. These
shareholders accounted for approximately 54 percent, 49 percent and 60 percent
of total revenues for years ended December 31, 2002, 2001 and 2000,
respectively.

The Company has one customer in 2002 representing more than 10 percent of
revenues. This significant customer represented 19 percent, 15 percent and 15
percent of total revenues for the years ended December 31, 2002, 2001 and 2000,
respectively. In 2000, the Company had a further significant customer
representing more than 10 percent of revenues that accounted for 13 percent of
total revenues for that year. The Company has no other unusual credit risks or
concentrations.


10. Retirement and incentive plans

Defined contribution plan - The Company has defined contribution plans for
substantially all Company employees. The Company matches a portion of the
employee contribution. Total compensation expense related to the defined
contribution plans approximated $1,097,000, $1,079,000 and $733,000 for the
years ended December 31, 2002, 2001 and 2000, respectively.

Executive incentive plan - In 1998, the Company executed a long-term incentive
plan (the "Executive Plan") with the chief executive officer of the company at
that time. Under the Executive Plan, the individual was entitled to receive
ordinary shares of the Company if an initial public offering ("IPO") of the
Company's stock or a private transaction involving no less than 20 percent of
the common shares of the Company (collectively, the "Equity Transaction") was
completed prior to August 1, 2002. The number of shares awarded under the
Executive Plan was to be dependent upon the fair market value of the Company on
the date of the Equity Transaction. On October 10, 2000, the Company
successfully completed its IPO and the individual was granted 155,556 ordinary
shares valued at $9.00 per ordinary share. Under the terms of the Executive
Plan, the Company also paid an additional $0.9 million relating to the tax
liability due on this award. One third of the awarded shares vested on the date
of the Equity Transaction and the remaining shares vested in two equal
installments ending on December 31, 2001.

The total compensation awarded in relation to the Executive Plan was $2.3
million. The Company recognized $1,069,000 and $1,124,000 of compensation
expense for the years ended December 31, 2001 and 2000, respectively, under the
Executive Plan.

Stock option plans - The Supervisory Board of Directors adopted the 1999 Stock
Option Plan as amended ("Stock Plan") effective January 1, 1999. The Supervisory
Board can administer the Stock Plan itself or through a committee of the
Supervisory Board or can appoint a foundation to administer the plan. At no time
can the number of options issued under the Stock Plan exceed 10 percent of the
issued common stock of the Company unless the Board amends the Stock Plan. All
grants under the plan, including option grants and incentive stock plan grants,
are subject to an aggregate limitation, which was increased in 2002 to a total
of 13,057,024 ordinary shares representing 10 percent of the issued ordinary
shares as of the date of the amendment. As of December 31, 2002, the total
number of shares available for grant was 5,600,291.

The Board utilized independent valuations performed by KPMG Corporate Finance in
establishing the estimated fair value of the common shares underlying each of
the options that have been granted under the Stock Plan in the period prior to
the Company's IPO in 2000. Options granted subsequent to the IPO were based on
the fair market value at the date of grant. The options have a maximum term of
10 years. All options vest in 3 equal annual installments.

The Supervisory Board has also approved the Stock Option Plan for the
Supervisory Board, as amended (the "Directors Plan"). The terms of the Directors
Plan are similar to those of the 1999 Stock Option Plan. The options have a term
of ten years and vest ratably in three equal installments annually from the date
of grant. At December 31, 1999, options to acquire 227,930 common shares were
granted under the Directors Plan and were approved by the shareholders at the
annual meeting on June 28, 2000. Substantially all of the options that were
awarded were for prior service on the Supervisory Board. As such, these awards
vest as if they had been issued during 1998 and 1999. At the annual meeting of
shareholders in the years 2002, 2001 and 2000, the shareholders approved further
grants to members of the Supervisory Board of 46,450 options, 89,659 options and
21,570 options, respectively.

The following table presents a summary of the Company's share option activity
and related information for the years ended December 31, 2002, 2001 and 2000:

                                                                     Weighted
                                               Options               Average
                                            Outstanding           Exercise Price
                                         ------------------    ----------------
      Outstanding, January 1, 2000              2,291,290      $         7.50

               Granted                          1,373,400               10.03
               Exercised                                -                  -
               Forfeited                        (123,650)                8.40
                                         ------------------    ----------------
      Outstanding, December 31, 2000            3,541,040                8.45

               Granted                          1,534,849                9.02
               Exercised                          (8,905)                7.50
               Forfeited                        (162,682)                9.14
                                         ------------------    ----------------
      Outstanding, December 31, 2001            4,904,302                8.61

               Granted                          2,525,847                4.95
               Exercised                                -                   -
               Forfeited                        (519,520)                7.77
                                         ------------------    ----------------
      Outstanding, December 31, 2002            6,910,629      $         7.35
                                         ==================    ================


Additional information regarding options outstanding at December 31, 2002 is as
follows:
<TABLE>
<CAPTION>

                               Options Outstanding
  -------------------------------------------------------------------------------------------------------------

            Range of                     Number                 Weighted Average                 Number
   Exercise Prices per share           Outstanding           Remaining Contractual            Exercisable
                                                                  Life (years)
  -----------------------------    --------------------     -------------------------     ---------------------
<S>                                  <C>                           <C>                     <C>
  $  3.50  -  $ 5.00                   2,350,097                     9.2                             -
  $  5.01  -  $ 6.50                      58,750                     9.3                             -
  $  6.51  -  $ 8.00                   2,272,649                     6.3                     2,169,150
  $  8.01  -  $ 9.50                   1,475,401                     7.9                       585,049
  $  9.51  -  $11.00                     753,732                     7.3                       470,303
</TABLE>



The Company records compensation related to stock options using the intrinsic
value method prescribed by APB No. 25, Accounting for Stock Issued to Employees,
and related interpretations. Certain options awarded during 1999 and 2000 were
considered to be granted below fair market value according to an independent
valuation report prepared by KPMG Corporate Finance and received subsequent to
the granting of these options. Prior to the receipt of this report, an earlier
independent valuation report had been used to determine the exercise price of
options granted. In addition, certain other option awards required shareholder
ratification by which time the market value of the shares had changed. The
difference in value at the grant date for such option awards and the subsequent
determined market value was required to be accounted for as compensation. As of
December 31, 2001 and 2000, $352,000 and $871,000, respectively, of such
compensation was considered unearned and is being amortized over the remaining
vesting period of the related options. The amount of unearned compensation
amortized to income in 2002, 2001 and 2000 under the Stock Option Plans was
approximately $352,000, $473,000 and $944,000, respectively.

The Company has adopted the disclosure requirements of SFAS No. 123, Accounting
for Stock-Based Compensation. SFAS No. 123 defines a fair value method of
accounting for stock-based compensation awards to employees and non-employees.
SFAS No. 123 requires that the fair value of stock-based awards to employees be
calculated through the use of option pricing models, even though such models
were developed to estimate the fair value of freely tradable, fully transferable
options without vesting restrictions, which significantly differ from the
Company's stock option awards. These models also require subjective assumptions,
which greatly affect the calculated values.

The fair value of the stock option grants has been estimated on the date of the
grant using the Black-Scholes option-pricing model with the following
assumptions:


                               2002             2001           2000
                           -------------    ------------   --------------

   Expected life              5 years          5 years        5 years
   Interest rate               3.75%            4.5%            5.75%
   Volatility                   40%              30%              25%
   Assumed forfeitures          10%              10%              10%

The weighted average fair value of stock options granted during 2002, 2001 and
2000 was $2.01, $3.14 and $4.22, respectively.



<PAGE>


Had compensation expense for the stock option plans been determined consistent
with SFAS No. 123, the Company's pro forma net income (loss) and net income
(loss) per share would have been as follows:

<TABLE>
<CAPTION>


                                              2002                2001                2000
                                       --------------------  -----------------  -------------------
   Net income (loss):
<S>                                    <C>                   <C>                <C>
           As reported                 $      (4,645,000)    $    33,068,000    $      31,674,000
           Pro forma                          (9,074,000)         28,371,000           29,236,000
   Basic and diluted net income
     (loss) per share:
           As reported                 $           (0.04)    $          0.25    $            0.29
           Pro forma                               (0.07)               0.22                 0.27

</TABLE>



Effective January 1, 2003, the Company will record compensation cost for stock
options and other forms of stock-based compensation issued subsequent to that
date in accordance with SFAS No. 123. (See Note 2).

Incentive stock plan - In 2002, the members of the Management Board were awarded
rights to acquire an aggregate of 233,736 ordinary shares. These rights are
similar to restricted stock grants which entitle (and require) the individual to
purchase the shares specified in the grant at a price per share equal to the
nominal value ((euro)0.05). The purchase of shares under each grant is to be
settled in three equal installments within 30 days of the designated settlement
dates, which generally are the first, second and third anniversary of the date
of grant. The Management Board grants are governed by a plan administered by the
Supervisory Board. All grants under the plan are subject to the aggregate
limitation that was raised in 2002 to a total of 13,057,024 ordinary shares.
Grants may be extinguished under certain limited circumstances if the individual
recipient ceases to be an employee of the Company.

In 2002, the shareholders also approved the grant to the members of the
Supervisory Board of the rights to acquire an aggregate of 18,583 ordinary
shares, with similar entitlements and obligations as the rights granted to the
Management Board as described above. The Supervisory Board grants are governed
by a plan administered by the Company's Compliance Officer. The fair value of
the restricted stock grants made to the Management Board and Supervisory Board
members in 2002 was $1,237,000 and $101,000, respectively. At December 31, 2002
$685,000 of such compensation was considered unearned and is being amortized
over the remaining vesting period of these grants. The amount of unearned
compensation amortized to income in 2002 under the Incentive Stock Plan was
$653,000.

11. Business segments and geographic information

The Company monitors its operations as a single enterprise and therefore
believes that it has one operating segment, which is telecommunication satellite
services.

The geographic source of revenues, based on the billing addresses of customers,
for the years ended December 31 is as follows:
<TABLE>
<CAPTION>

   (in thousands of U.S. dollars)                     2002               2001                2000
                                                ------------------  ----------------- --------------------

<S>                                             <C>                 <C>               <C>
   North America                                $        74,861     $       72,043    $          73,181
   Europe                                                41,407             48,795               57,871
   Asia Pacific                                          16,069             17,906               20,663
   Latin America                                         24,577             34,094               27,827
   India, Middle East and Africa                         43,610             36,190               18,752
                                                ------------------  ----------------- --------------------
   Total                                        $       200,524     $      209,028    $         198,294
                                                ==================  ================= ====================
</TABLE>


The Company's satellites are in geosynchronous orbit, and consequently are not
attributable to any geographic location. Of the remaining assets, substantially
all are located in Europe.