<PAGE>
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

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

                                   FORM 10-Q

<TABLE>
<C>        <S>
   /X/     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
           SECURITIES EXCHANGE ACT OF 1934
</TABLE>

                      FOR THE QUARTER ENDED MARCH 31, 2001

                                       OR

<TABLE>
<C>        <S>
   / /     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
           SECURITIES EXCHANGE ACT OF 1934
</TABLE>

           FOR THE TRANSITION PERIOD FROM             TO

                         COMMISSION FILE NO. 000-25365

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

                     UNITED PAN-EUROPE COMMUNICATIONS N.V.
             (Exact name of Registrant as specified in its charter)

<TABLE>
<S>                                                      <C>
            THE NETHERLANDS                                    98-0191997
    (State or other jurisdiction of                         (I.R.S. Employer
     incorporation or organization)                       Identification No.)

           BOEING AVENUE 53,                                    1119 PE
     SCHIPHOL RIJK, THE NETHERLANDS                            (ZIP CODE)
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
</TABLE>

      REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (31) 20-778-9840

    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 and (2) has been subject to such filing
requirements for the past 90 days. Yes /X/  No / /

    The number of shares outstanding of the Registrant's common stock as of
May 14, 2001 was:

                    441,246,729 ordinary shares A, including
               shares represented by American Depository Receipts

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE>
                     UNITED PAN-EUROPE COMMUNICATIONS N.V.

                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                PAGE
                                                               NUMBER
                                                              --------
<S>                                                           <C>
                    PART I--FINANCIAL INFORMATION

ITEM 1--FINANCIAL STATEMENTS

  Consolidated Balance Sheets of March 31, 2001 (Unaudited)
  and December 31, 2000.....................................      1

  Consolidated Statements of Operations for the Three Months
  Ended March 31, 2001 and 2000 (Unaudited).................      2

  Consolidated Statement of Shareholders' Equity for the
  Three Months Ended March 31, 2001 (Unaudited).............      3

  Consolidated Statements of Cash Flows for the Three Months
  Ended March 31, 2001 and 2000 (Unaudited).................      4

  Notes to Consolidated Financial Statements (Unaudited)....      6

ITEM 2-- MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
        CONDITION AND RESULTS OF OPERATIONS.................     19

ITEM 3--QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET
RISK........................................................     34

                      PART II--OTHER INFORMATION

ITEM 5--OTHER INFORMATION...................................     38

ITEM 6--EXHIBITS AND REPORTS ON FORM 8-K....................     44
</TABLE>
<PAGE>
                     UNITED PAN-EUROPE COMMUNICATIONS N.V.

                          CONSOLIDATED BALANCE SHEETS

       (STATED IN THOUSANDS OF EUROS, EXCEPT SHARE AND PER SHARE AMOUNTS)

                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                                AS OF         AS OF
                                                              MARCH 31,    DECEMBER 31,
                                                              -------------------------
                                                                 2001          2000
                                                              ----------   ------------
<S>                                                           <C>          <C>
ASSETS:
Current assets
  Cash and cash equivalents.................................   1,129,487     1,590,230
  Restricted cash...........................................       2,984           421
  Subscriber receivables, net of allowance for doubtful
    accounts of 56,968 and 57,108, respectively.............     130,766       151,977
  Costs to be reimbursed by affiliated companies............      18,981        12,459
  Other receivables, including related party receivables of
    5,585 and 5,140, respectively...........................     154,717       155,212
  Inventory.................................................     162,155       127,813
  Prepaid expenses and other current assets.................     109,628        82,475
                                                              ----------    ----------
      Total current assets..................................   1,708,718     2,120,587
Other investments...........................................     100,923       105,063
Investments in and advances to affiliated companies.........     672,783       685,288
Property, plant and equipment, net..........................   3,656,769     3,581,539
Goodwill and other intangible assets, net...................   5,089,530     5,119,892
Deferred financing costs, net...............................     167,858       178,113
Compound swaps..............................................     387,981             -
Other assets................................................      13,514        11,889
                                                              ----------    ----------
      Total assets..........................................  11,798,076    11,802,371
                                                              ==========    ==========
LIABILITIES AND SHAREHOLDERS' EQUITY:
Current liabilities
  Accounts payable, including related party payables of
    3,470 and 762, respectively.............................     383,391       579,060
  Accrued liabilities.......................................     593,528       583,351
  Subscriber prepayments and deposits.......................     161,762       100,696
  Short-term debt...........................................      40,119        51,860
  Current portion of long-term debt.........................      20,501        17,832
                                                              ----------    ----------
      Total current liabilities.............................   1,199,301     1,332,799
Long-term debt..............................................   8,729,951     8,078,269
Other long-term liabilites..................................      53,143        46,801
                                                              ----------    ----------
      Total liabilites......................................   9,982,395     9,457,869
                                                              ----------    ----------

Commitments and contingencies, see Note 9.

Minority interests in subsidiaries..........................     812,772       831,132

Shareholders' equity (As adjusted for stock split, see Note
  10)
  Priority stock, 1.0 par value, 300 shares authorized, 300
    and 300 shares issued, respectively.....................           -             -
  Series 1 convertible preference stock, class A common
    stock, 1.0 par value, 12,400 shares, authorized, 12,400
    and 12,400 shares issued and outstanding,
    respectively............................................   1,414,885     1,392,251
  Ordinary stock, 1.0 par value, 600,000,000 shares
    authorized, 441,246,729 and 441,246,729 shares issued
    and outstanding, respectively...........................     441,247       441,247
  Additional paid-in capital................................   2,798,080     2,800,234
  Deferred compensation.....................................     (87,012)      (87,945)
  Accumulated deficit.......................................  (3,696,822)   (3,110,627)
  Other cumulative comprehensive income.....................     132,531        78,210
                                                              ----------    ----------
      Total shareholders' equity............................   1,002,909     1,513,370
                                                              ----------    ----------
      Total liabilities and shareholders' equity............  11,798,076    11,802,371
                                                              ==========    ==========
</TABLE>

  The accompanying notes are an integral part of these consolidated financial
                                  statements.

                                       1
<PAGE>
                     UNITED PAN-EUROPE COMMUNICATIONS N.V.

                     CONSOLIDATED STATEMENTS OF OPERATIONS

       (STATED IN THOUSANDS OF EUROS, EXCEPT SHARE AND PER SHARE AMOUNTS)

                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                                FOR THE THREE MONTHS
                                                                   ENDED MARCH 31,
                                                              -------------------------
                                                                 2001          2000
                                                              -----------   -----------
<S>                                                           <C>           <C>
Service and other revenue...................................      333,448       199,600
Operating expense...........................................     (255,335)     (141,882)
Selling, general and administrative expense.................     (139,983)     (167,161)
Depreciation and amortization...............................     (245,179)     (130,703)
                                                              -----------   -----------
    Net operating loss......................................     (307,049)     (240,146)
Interest income.............................................       15,755        13,373
Interest expense............................................     (218,219)     (140,393)
Foreign exchange gain (loss) and other income (expense),
  net.......................................................      (55,105)      (79,953)
                                                              -----------   -----------
    Net loss before income taxes and other items............     (564,618)     (447,119)
Share in results of affiliated companies....................      (46,096)      (21,215)
Minority interests in subsidiaries..........................       18,841           984
Income tax benefit (expense)................................           90           (21)
                                                              -----------   -----------
Net loss before cumulative effect of change in accounting
  principle.................................................     (591,783)     (467,371)
Cumulative effect of change in accounting principle.........       35,349             -
                                                              -----------   -----------
    Net loss................................................     (556,434)     (467,371)
                                                              ===========   ===========
Basic net loss attributable to common shareholders (See Note
  13).......................................................     (586,195)     (467,371)
                                                              ===========   ===========
Basic and diluted net loss per ordinary share before
  cumulative effect of change in accounting principle(1)....        (1.34)        (1.07)
                                                              ===========   ===========
Basic and diluted net loss per ordinary share(1)............        (1.33)        (1.07)
                                                              ===========   ===========
Weighted-average number of ordinary shares outstanding(1)...  441,246,729   435,608,107
                                                              ===========   ===========
</TABLE>

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

(1) As adjusted for the stock splits. See Note 10.

  The accompanying notes are an integral part of these consolidated financial
                                  statements.

                                       2
<PAGE>
                     UNITED PAN-EUROPE COMMUNICATIONS N.V.
                 CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
       (STATED IN THOUSANDS OF EUROS, EXCEPT SHARE AND PER SHARE AMOUNTS)
                                  (UNAUDITED)
<TABLE>
<CAPTION>
                                                                     SERIES 1
                                                                   CONVERTIBLE
                                                                     CLASS A
                                                                    PREFERENCE
                                           PRIORITY STOCK             STOCK               ORDINARY STOCK       ADDITIONAL
                                         -------------------   --------------------   ----------------------    PAID-IN
                                          SHARES     AMOUNT     SHARES     AMOUNT       SHARES       AMOUNT     CAPITAL
                                         --------   --------   --------   ---------   -----------   --------   ----------
<S>                                      <C>        <C>        <C>        <C>         <C>           <C>        <C>
Balance, December 31, 2000.............      300          -     12,400    1,392,251   441,246,729   441,247    2,800,234
Deferred compensation expense related
  to stock options, net................        -          -          -            -             -         -       (2,154)
Amortization of deferred
  compensation.........................        -          -          -            -             -         -            -
Capital tax preference stock...........        -          -          -       (7,127)            -         -            -
Accrual of Dividend on Series 1
  Convertible Preferred Stock..........        -          -          -       28,385             -         -            -
Accretion of Discount of Series 1
  Convertible Preferred Stock..........        -          -          -        1,376             -         -            -
Unrealized gain on investments.........        -          -          -            -             -         -            -
Change in cumulative translation
  adjustments..........................        -          -          -            -             -         -            -
Net loss...............................        -          -          -            -             -         -            -
Total comprehensive loss...............        -          -          -            -             -         -            -
                                          ------    -------     ------    ---------   -----------   -------    ---------
Balance, March 31, 2001................      300          -     12,400    1,414,885   441,246,729   441,247    2,798,080
                                          ======    =======     ======    =========   ===========   =======    =========

<CAPTION>

                                                                      OTHER CUMULATIVE
                                                                       COMPREHENSIVE
                                           DEFERRED     ACCUMULATED        INCOME
                                         COMPENSATION     DEFICIT        (LOSS)(1)         TOTAL
                                         ------------   -----------   ----------------   ---------
<S>                                      <C>            <C>           <C>                <C>
Balance, December 31, 2000.............    (87,945)     (3,110,627)        78,210        1,513,370
Deferred compensation expense related
  to stock options, net................      2,154               -              -                -
Amortization of deferred
  compensation.........................     (1,221)              -              -           (1,221)
Capital tax preference stock...........          -               -              -           (7,127)
Accrual of Dividend on Series 1
  Convertible Preferred Stock..........          -         (28,385)             -                -
Accretion of Discount of Series 1
  Convertible Preferred Stock..........          -          (1,376)             -                -
Unrealized gain on investments.........          -               -         38,038           38,038
Change in cumulative translation
  adjustments..........................          -               -         16,283           16,283
Net loss...............................          -        (556,434)             -         (556,434)
                                                                                         ---------
Total comprehensive loss...............          -               -              -         (502,113)
                                           -------      ----------        -------        ---------
Balance, March 31, 2001................    (87,012)     (3,696,822)       132,531        1,002,909
                                           =======      ==========        =======        =========
</TABLE>

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

(1) As of December 31, 2000, Other Cumulative Comprehensive Income (Loss)
    represents foreign currency translation adjustments of 59,789 and unrealized
    gain on investments of 18,421.

    As of March 31, 2001, Other Cumulative Comprehensive Income (Loss)
    represents foreign currency translation adjustments of 76,072 and unrealized
    gain on investments of 56,459.

  The accompanying notes are an integral part of these consolidated financial
                                  statements.

                                       3
<PAGE>
                     UNITED PAN-EUROPE COMMUNICATIONS N.V.
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
       (STATED IN THOUSANDS OF EUROS, EXCEPT SHARE AND PER SHARE AMOUNTS)
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                               FOR THE THREE MONTHS
                                                                 ENDED MARCH 31,
                                                              ----------------------
                                                                2001         2000
                                                              ---------   ----------
<S>                                                           <C>         <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss....................................................   (556,434)    (467,371)
Adjustments to reconcile net loss to net cash flows from
  operating activities:
  Depreciation and amortization.............................    245,179      130,703
  Amortization of deferred financing costs..................      8,481        3,640
  Accretion of interest expense.............................     62,901       52,381
  Share in results of affiliated companies..................     46,096       21,215
  Compensation expense related to stock options.............      1,062       52,038
  Minority interests in subsidiaries........................    (18,841)        (984)
  Exchange rate differences in loans........................    112,322       91,051
  Cumulative effect of change in accounting principle.......    (35,349)           -
  Gain on compound swap.....................................    (47,541)           -
  Other.....................................................    (28,737)      (9,813)
  Changes in assets and liabilities:
    Increase in receivables.................................    (14,053)     (41,737)
    (Increase) decrease in inventories......................    (34,589)       6,436
    Decrease (increase) in other non-current assets.........         25      (18,580)
    Increase (decrease) in other current liabilities........   (141,014)     177,422
    Increase in deferred taxes and other long-term
     liabilities............................................    (27,879)     (29,926)
                                                              ---------   ----------
Net cash flows from operating actvities.....................   (428,371)     (33,525)
                                                              ---------   ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment in securities, net...............................          -      (44,538)
Investments in and advances to affiliated companies, net of
  repayments................................................     (5,940)    (304,275)
Capital expenditures........................................   (177,725)    (253,202)
Acquisitions, net of cash acquired..........................    (22,892)  (1,347,330)
                                                              ---------   ----------
Net cash flows from investing activities....................   (206,557)  (1,949,345)
                                                              ---------   ----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from senior notes..................................          -    1,594,161
Proceeds from short-term borrowings.........................          -      267,962
Proceeds from long-term borrowings..........................    200,000      139,491
Deferred financing costs....................................          -      (31,764)
Repayments of long-term and short-term borrowings...........    (26,202)    (297,298)
                                                              ---------   ----------
Net cash flows from financing activities....................    173,798    1,672,552
                                                              ---------   ----------
EFFECT OF EXCHANGE RATES ON CASH............................        387          173
                                                              ---------   ----------
NET DECREASE IN CASH AND CASH EQUIVALENTS...................   (460,743)    (310,145)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD............  1,590,230    1,025,460
                                                              ---------   ----------
CASH AND CASH EQUIVALENTS AT END OF PERIOD..................  1,129,487      715,315
                                                              =========   ==========
</TABLE>

  The accompanying notes are an integral part of these consolidated financial
                                  statements.

                                       4
<PAGE>
                     UNITED PAN-EUROPE COMMUNICATIONS N.V.

                    CONSOLIDATED STATEMENTS OF CASH FLOWS(2)

       (STATED IN THOUSANDS OF EUROS, EXCEPT SHARE AND PER SHARE AMOUNTS)

                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                              FOR THE THREE MONTHS
                                                                 ENDED MARCH 31,
                                                              ---------------------
                                                                2001        2000
                                                              ---------   ---------
<S>                                                           <C>         <C>
NON-CASH INVESTING AND FINANCING ACTIVITIES:
  Unrealized (gain) loss on investments.....................   (38,038)     48,762
                                                              ========    ========
SUPPLEMENTAL CASH FLOW DISCLOSURES:
  Cash paid for interest....................................  (189,211)   (102,715)
                                                              ========    ========
  Cash received for interest................................    13,171      13,739
                                                              ========    ========
</TABLE>

  The accompanying notes are an integral part of these consolidated financial
                                  statements.

                                       5
<PAGE>
                     UNITED PAN-EUROPE COMMUNICATIONS N.V.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.  ORGANIZATION AND NATURE OF OPERATIONS

    United Pan-Europe Communications N.V., formerly known as United and Philips
Communications B.V. ("UPC" or the "Company"), was formed for the purpose of
acquiring and developing multi-channel television and telecommunications systems
in Europe. In 1995, UnitedGlobalCom, Inc. (formerly known as United
International Holdings, Inc. ("United")), a United States of America
corporation, and Philips Electronics N.V. ("Philips"), contributed their
respective ownership interests in European and Israeli multi-channel television
systems to UPC. In December, 1997, United acquired Philips' 50% interest in UPC
(the "UPC Acquisition"), thereby making it an effectively wholly-owned
subsidiary of United (subject to certain employee equity incentive compensation
arrangements). Subsequently in February 1999, UPC had its initial public
offering. As of March 31, 2001, United owns 53.3% of UPC. Through its broadband
communications networks or services in 17 countries in Europe and in Israel, UPC
currently offers communication services in many European countries through its
three primary business units, UPC Distribution, UPC Media and Priority Telecom.
UPC Distribution, which comprises the local operating systems, provides video,
telephony and internet services for residential customers. UPC Media comprises
the internet access and converging internet content and programming businesses.
The third unit, PRIORITY TELECOM, focuses on providing network solutions to the
business customer.

                                       6
<PAGE>
                     UNITED PAN-EUROPE COMMUNICATIONS N.V.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

1.  ORGANIZATION AND NATURE OF OPERATIONS (CONTINUED)
    The following chart presents a summary of the Company's significant
investments as of March 31, 2001.

<TABLE>
<CAPTION>
                                                              UPC'S OWNERSHIP
                                                              ---------------
<S>                                                           <C>
DISTRIBUTION:
AUSTRIA:
  Telekabel Group...........................................        95.0%
BELGIUM:
  UPC Belgium...............................................       100.0%
CZECH REPUBLIC:
  KabelNet..................................................       100.0%
  Kabel Plus................................................        99.9%
FRANCE:
  UPC France................................................        92.0%
GERMANY:
  EWT/TSS Group.............................................        51.0%
  PrimaCom AG ("Primacom")..................................        25.0%
HUNGARY:
  UPC Magyarorszag..........................................       100.0%
  Monor Communications Group, Inc. ("Monor")................        98.9%
THE NETHERLANDS:
  UPC Nederland.............................................       100.0%
  Alkmaar...................................................       100.0%
NORWAY:
  UPC Norge AS ("UPC Norge")................................       100.0%
SWEDEN:
  UPC Sweden................................................       100.0%
SLOVAK REPUBLIC:
  Trnavatel.................................................        95.0%
  Kabeltel..................................................       100.0%
  UPC Slovensko s.r.o.......................................       100.0%
ROMANIA:
  Eurosat...................................................        51.0%
  AST Romania...............................................        70.0%
POLAND:
  UPC Polska, Inc ("UPC Polska")............................       100.0%

MEDIA:
OTHER:
  CHELLO BROADBAND N.V. ("CHELLO")..........................       100.0%
IRELAND:
  Tara Televison Limited....................................        80.0%
U.K./CENTRAL EUROPE:
  UPC Broadcast Centre Ltd. ("UPC Broadcast Centre")........       100.0%
</TABLE>

                                       7
<PAGE>
                     UNITED PAN-EUROPE COMMUNICATIONS N.V.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

1.  ORGANIZATION AND NATURE OF OPERATIONS (CONTINUED)

<TABLE>
<CAPTION>
                                                              UPC'S OWNERSHIP
                                                              ---------------
<S>                                                           <C>
SPAIN:
  Iberian Programming Services ("IPS")......................        50.0%
UNITED KINGDOM:
  Xtra Music Ltd............................................        50.0%
OTHER:
  SBS Broadcasting SA ("SBS")...............................        23.5%
THE NETHERLANDS:
  UPC Programming B.V. ("UPCtv")............................       100.0%
CZECH/SLOVAK/HUNGARY:
  UPC Direct Programming B.V................................       100.0%
POLAND:
  Wizja TV B.V..............................................       100.0%

PRIORITY TELECOM:
THE NETHERLANDS:
  Priority Telecom N.V. ("Priority Telecom")................        83.4%

OTHER:
ISRAEL:
  Tevel Israel International Communications Ltd.
  ("Tevel").................................................        46.6%
MALTA:
  Melita Cable TV P.L.C. ("Melita").........................        50.0%
</TABLE>

2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

RISKS AND UNCERTAINTIES

    The Company has incurred substantial operating losses and negative cash
flows from operations which have been driven by the continuing development
efforts including the introduction of new services such as digital video,
telephone and internet. Additionally, substantial capital expenditures have been
required to deploy these services and to acquire businesses. Management expects
the Company to incur operating losses in 2001 and 2002 primarily as a result of
the continued introduction of these new services which are in the early stages
of deployment. The Company's business plan calls for substantial growth in the
number of subscribers that will use these new services. This growth requires the
availability of capital resources that are sufficient to fund expected capital
expenditures. Growth in subscribers will also be required in order for the
Company to achieve consolidated operating profitability and positive operating
cash flows. Management believes that the Company can achieve the anticipated
growth in subscribers and that the required capital resources will be available
to fund expected capital expenditures and operating losses. However, if such
subscriber growth is not achieved, management believes access to sources of
capital will be sufficient to satisfy future cash needs. Management's estimates
of the cash flows generated by these new services and the capital resources
needed and available to complete their deployment could change, and such change
could differ materially from the estimates used to evaluate the Company's
ability to realize its investments.

                                       8
<PAGE>
                     UNITED PAN-EUROPE COMMUNICATIONS N.V.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
BASIS OF PRESENTATION

    The accompanying consolidated financial statements of the Company have been
prepared in accordance with United States generally accepted accounting
principles. The preparation of financial statements in conformity with United
States generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and the disclosure of contingent assets and liabilities, at the date
of the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.
All amounts are stated in thousands of Euros, except where stated otherwise.

    In management's opinion, all adjustments of a normal, recurring nature have
been made which are necessary to present fairly the financial position of the
Company as of March 31, 2001 and the results of its operations for the three
months ended March 31, 2001 and 2000. For a more complete understanding of the
Company's financial position and results of operations we refer to the
consolidated financial statements of the Company included in the Company's
annual report on Form 10-K for the year ended December 31, 2000.

PRINCIPLES OF CONSOLIDATION

    The accompanying consolidated financial statements include the accounts of
UPC and all subsidiaries where it exercises a controlling interest through the
ownership of a majority voting interest. All significant intercompany accounts
and transactions have been eliminated in consolidations.

ACCOUNTING CHANGE

    Effective January 1, 2001, the Company adopted Statement of Financial
Accounting Standards No. 133, "Accounting for Derivative and Hedging Activities"
("SFAS 133"), which establishes accounting and reporting standards for
derivative instruments, including certain derivative instruments embedded in
other contracts and for hedging activities. All derivatives, whether designated
in hedging relationships or not, are required to be recorded on the balance
sheet at fair value. The adoption of SFAS 133 on January 1, 2001, resulted in a
cumulative increase to income of Euro 35.3 million and a cumulative increase to
Other Comprehensive Income ("OCI") of Euro 36.7 million. The increase to income
was attributable to a loss of approximately Euro 36.7 million reclassified from
OCI for the value of certain warrants held by the Company which are derivatives
and are not designated as a hedging instrument, and income of approximately
Euro 72.0 million related to gains associated with the cross currency swaps
which are held by the Company which do not qualify as hedging instruments as
defined by SFAS 133. The fair value of the compound swaps as of March 31, 2001
amounting to Euro 388.0 million (including both the fair value of the foreign
currency part and the interest part of the swaps) has been recorded as an asset
on the balance sheet. Of this amount Euro 268.4 has been added to the carrying
value of the related long-term debt. The Company uses derivative instruments to
manage exposures to foreign currency and interest rate risks.

RECLASSIFICATIONS

    Certain prior period amounts have been reclassified for comparability with
the March 31, 2001 presentation.

                                       9
<PAGE>
                     UNITED PAN-EUROPE COMMUNICATIONS N.V.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

3.  ACQUISITIONS

ENECO K&T GROUP

    In March 2000, UPC acquired the Eneco K&T Group ("K&T"), the cable interests
of ENECO N.V., for a consideration of 1,046.3 million, including the repayment
to ENECO N.V. and the assumption of debt from K&T to ENECO N.V. of
225.6 million. The acquisition was accounted for under purchase accounting.
Effective March 31, 2000, UPC began consolidating its investment in K&T.

PRO FORMA INFORMATION

    The following unaudited pro forma condensed consolidated operating results
for the three months ended March 31, 2000 gives effect to UPC's acquisition of
K&T as if this acquisition had occurred at the beginning of the period
presented. This unaudited pro forma condensed consolidated financial information
does not purport to represent what the Company's results of operations would
actually have been if such transactions had in fact occurred on such date.

<TABLE>
<CAPTION>
                                                              FOR THE THREE MONTHS ENDED
                                                                    MARCH 31, 2000
                                                              ---------------------------
                                                               HISTORICAL     PRO FORMA
                                                              ------------   ------------
<S>                                                           <C>            <C>
Service and other revenue...................................      199,600        216,844
                                                              ===========    ===========
Net loss....................................................     (467,371)      (516,359)
                                                              ===========    ===========
Weighted-average number of ordinary shares outstanding......  435,608,107    435,608,107
                                                              ===========    ===========
Basic and diluted net loss per ordinary share...............        (1.07)         (1.19)
                                                              ===========    ===========
</TABLE>

ACQUISITION OF ALKMAAR

    In January 2001, UPC acquired De Alkmaarse Kabel B.V., which owns and
operates cable and broadband networks primarily in the Alkmaar region of the
Netherlands, for a purchase price of 49.2 million. The purchase price was paid
with cash of 22.9 million and an one-year note with interest of 8% per annum.
The note is payable in cash or shares of UPC, at UPC's option.

ANNOUNCEMENT OF MERGER WITH PRIMACOM

    On March 29, 2001, UPC announced an agreement with PrimaCom to merge its
German assets, including EWT/TSS and the TeleColumbus option, as well as its
Alkmaar subsidiary located in the Netherlands, with those of Primacom. The
proposed transaction is subject to approval by the PrimaCom shareholders, as
well as various regulatory and other approvals. The merger is expected to close
in the third quarter of 2001.

                                       10
<PAGE>
                     UNITED PAN-EUROPE COMMUNICATIONS N.V.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

4.  INVESTMENTS IN AND ADVANCES TO AFFILIATED COMPANIES, ACCOUNTED FOR UNDER THE
EQUITY METHOD

<TABLE>
<CAPTION>
                                                           AS OF MARCH 31, 2001
                             ---------------------------------------------------------------------------------
                                INVESTMENTS IN      CUMULATIVE        CUMULATIVE        CUMULATIVE
                               AND ADVANCES TO      DIVIDENDS    SHARE IN RESULTS OF    TRANSLATION
                             AFFILIATED COMPANIES    RECEIVED    AFFILIATED COMPANIES   ADJUSTMENTS    TOTAL
                             --------------------   ----------   --------------------   -----------   --------
<S>                          <C>                    <C>          <C>                    <C>           <C>
Tevel......................         89,817            (5,500)            (54,383)         15,564       45,498
Melita.....................         12,688                 -              (1,981)            814       11,521
Xtra Music.................         15,176                 -              (7,162)            562        8,576
IPS........................         10,065            (2,742)              6,495           5,294       19,112
SBS........................        261,999                 -             (51,121)         40,099      250,977
PrimaCom...................        345,096                 -             (44,482)              -      300,614
Other, net.................         50,128              (707)            (13,067)            131       36,485
                                   -------            ------            --------          ------      -------
Total......................        784,969            (8,949)           (165,701)         62,464      672,783
                                   =======            ======            ========          ======      =======
</TABLE>

5.  OTHER INVESTMENTS

    MARKETABLE EQUITY SECURITIES OF UNITED, AT FAIR VALUE

    As a result of the UPC Acquisition, a subsidiary of UPC acquired 6,338,302
of United's Class A common shares, as adjusted for United's 2:1 stock split in
November 1999, valued at fair market value of 30.3 million as of December 11,
1997. In November 1998, UPC sold 769,062 shares. As of March 31, 2001, the fair
value of the remaining 5,569,240 shares was 83.1 million resulting in a
cumulative unrealized gain of 56.5 million as of March 31, 2001.

    TERAYON WARRANTS

    UPC acquired warrants from Terayon Communication Systems, Inc. ("Terayon"),
a public company, for 2 million shares of Terayon's common stock as a part of a
relationship agreement entered into with Terayon in January 2000. The Company
recorded the receipt of these warrants as an asset representing the fair value
of the warrants at the date of receipt recorded in "other investments" and a
credit recorded to "other long-term liabilities" which is being amortized to
income over the term of the relationship agreement. For the three months period
ended March 31, 2001, 3.1 million was amortized and has been reflected in
"foreign exchange gain (loss) and other income (expense)" in the accompanying
statement of operations.

                                       11
<PAGE>
                     UNITED PAN-EUROPE COMMUNICATIONS N.V.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

6.  PROPERTY, PLANT AND EQUIPMENT

<TABLE>
<CAPTION>
                                                                AS OF        AS OF
                                                              MARCH 31,   DECEMBER 31,
                                                              ------------------------
                                                                2001          2000
                                                              ---------   ------------
<S>                                                           <C>         <C>
Cable distribution networks.................................  3,202,827     3,089,342
Subscriber premises equipment and converters................    540,015       440,015
DTH, MMDS and distribution facilities.......................    221,541       218,568
Office equipment, furniture and fixtures....................    267,782       250,918
Buildings and leasehold improvements........................    134,020       132,092
Other.......................................................     86,977        61,636
                                                              ---------     ---------
                                                              4,453,162     4,192,571
  Accumulated depreciation..................................   (796,393)     (611,032)
                                                              ---------     ---------
  Property, plant and equipment, net........................  3,656,769     3,581,539
                                                              =========     =========
</TABLE>

7.  GOODWILL AND OTHER INTANGIBLE ASSETS

<TABLE>
<CAPTION>
                                                                AS OF        AS OF
                                                              MARCH 31,   DECEMBER 31,
                                                              ------------------------
                                                                2001          2000
                                                              ---------   ------------
<S>                                                           <C>         <C>
UPC Nederland...............................................  1,375,216     1,713,365
UPC Polska..................................................  1,090,419     1,024,469
UPC Germany.................................................    950,890       951,990
UPC Sweden..................................................    404,325       418,828
Priority Telecom............................................    691,347       363,215
UPC NV......................................................    217,218       208,540
Telekabel Group.............................................    180,498       180,200
UPC France..................................................    177,262       176,639
UPC Magyarorszag............................................    140,372       141,264
UPC Czech Republic..........................................    103,842       102,488
Priority Wireless Group.....................................    107,576       108,020
UPC Norge...................................................     86,544        72,427
Other.......................................................    102,823        96,838
                                                              ---------     ---------
                                                              5,628,332     5,558,283
  Accumulated amortization..................................   (538,802)     (438,391)
                                                              ---------     ---------
  Goodwill and other intangible assets, net.................  5,089,530     5,119,892
                                                              =========     =========
</TABLE>

                                       12
<PAGE>
                     UNITED PAN-EUROPE COMMUNICATIONS N.V.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

8.  LONG-TERM DEBT

<TABLE>
<CAPTION>
                                                                AS OF        AS OF
                                                              MARCH 31,   DECEMBER 31,
                                                              ------------------------
                                                                2001          2000
                                                              ---------   ------------
<S>                                                           <C>         <C>
July 1999 Notes.............................................  1,767,070     1,567,212
October 1999 Notes..........................................  1,174,092     1,059,174
January 2000 Notes..........................................  1,898,246     1,761,130
UPC Distribution Bank Facility..............................  2,585,260     2,395,998
UPC Bridge Facility.........................................    750,000       750,000
@Entertainment Notes........................................    355,954       323,275
DIC loan....................................................     53,255        55,359
Other.......................................................    166,575       183,953
                                                              ---------     ---------
                                                              8,750,452     8,096,101
  Less current portion......................................    (20,501)      (17,832)
                                                              ---------     ---------
  Total.....................................................  8,729,951     8,078,269
                                                              =========     =========
</TABLE>

    The increase in the July 1999 Notes, October 1999 Notes, January 2000 Notes,
as well as the UPC Distribution Bank Facility, is partly due to the adoption of
SFAS 133 as further disclosed in Note 2. Under SFAS 133, Euro 268.4 million
attributable to the compound swaps has been added to the carrying value of the
related long-term debt, with a corresponding amount recorded as an asset on the
balance sheet. This amount had previously been netted with the underlying debt
balance.

UPC DISTRIBUTION BANK FACILITY

    In October 2000, UPC closed a Euro 4.0 billion operating and term loan
facility ("UPC Distribution Bank Facility"). The facility is guaranteed by
existing cable operating companies, excluding Polish and German assets. The UPC
Bank Facilities bear interest at EURIBOR +0.75%-4.0% depending on certain
leverage ratios, and an annual commitment fee of 0.5% over the undrawn amount is
applicable. The facility was widely syndicated to a group of more than 50
European and American (Banking) institutions. A first drawing was made in
October 2000, to refinance existing operating company bank debt totaling
Euro 2.0 billion. The purpose of the UPC Distribution Bank Facility is to
finance further digital rollout and triple play by UPC's existing cable
companies, excluding Polish and German operations. Additional availability is
linked to certain performance tests. Management expects the additional borrowing
availability under this facility to increase throughout 2001. As customary for a
financing of this nature, certain financial covenants and restrictions on UPC's
cable companies' ability to make dividends and/or other payments to UPC, incur
indebtedness, dispose of assets, merge and enter into affiliate transactions.
UPC was in compliance with these covenants at March 31, 2001. Principal
repayment will begin in 2004. The facility reaches final maturity in 2009. At
March 31, 2001, Euro 2.6 billion was outstanding under this facility. The
facility is structured in different tranches, with one tranche denominated in
dollars for the amount of USD 347.5 million. Concurrent with the closing, UPC
entered into a cross currency swap to predominantly hedge currency risk.

                                       13
<PAGE>
                     UNITED PAN-EUROPE COMMUNICATIONS N.V.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

9.  COMMITMENTS AND CONTINGENCIES

LEASES

    UPC has entered into various short- and long-term agreements with third
parties, varying in term from 3 to 15 years, for indefeasible rights of use
("IRU's") on fiber optic cable as well as for operational leases. Under these
agreements UPC has commitments for discounted future minimum lease payments, and
for operation and maintenance charges, which total approximately 27.9 million as
of March 31, 2001.

    A subsidiary of UPC leases DTH technical equipment, conduit and satellite
transponder capacity, as well as several offices and warehouses. At March 2001,
these leases had an aggregate maximum commitment of approximately USD
220.5 million (250.7 million) over the next seven years.

    UPC has entered into an agreement for the long-term lease of satellite
transponder capacity providing service from Europe to Europe, North America and
South America. The term of the agreement is 156 months, with a minimum aggregate
total cost of approximately USD 107.9 million (122.7 million) payable in monthly
installments based on capacity used.

PROGRAMMING, BROADCAST AND EXHIBITION RIGHTS

    A subsidiary of UPC has entered into long-term programming agreements and
agreements for the purchase of certain exhibition or broadcast rights with a
number of third-party content providers for its digital direct-to-home ("DTH")
and cable systems. At March 31, 2001, these agreements had an aggregate minimum
commitment of approximately USD 264.5 million (300.7 million) over the next
seven years.

LITIGATION AND CLAIMS

    From time to time, the Company is subject to various claims and suits
arising out of the ordinary course of business. While the ultimate result of all
such matters is not presently determinable, based upon current knowledge and
facts, management does not expect that their resolution will have a material
adverse effect on the Company's consolidated financial position or results of
operations.

10. SHAREHOLDERS' EQUITY

    At an extraordinary general meeting of shareholders in March 2000, the
shareholders approved the amendment of UPC's Articles of Association to
(i) split each ordinary share A, priority share, preference share A and
preferred share B (as of December 31, 1999, with a nominal value of Euro 2.00
each) into three shares with a nominal value of Euro 1.00 each, (ii) split each
ordinary share B (as of December 31, 1999, with a nominal value of Euro 0.02
each) into three shares with a nominal value of Euro 0.01 each and (iii) pay up
an amount of Euro 145.2 million on account of the share premium reserve of the
Company. All share and per share amounts in the accompanying consolidated
financial statements and notes thereto have been retroactively restated to
reflect the 3 for 1 share split.

11. SEGMENT AND GEOGRAPHIC INFORMATION

    The Company's business has historically been derived from cable television.
Commencing in 1998, the Company began launching telephony and internet services
over parts of its upgraded network. The Company is managed internally as three
primary businesses, UPC Distribution, UPC Media and PRIORITY TELECOM. In
addition, Corporate, IT and Other is a separate reporting segment. UPC
Distribution

                                       14
<PAGE>
                     UNITED PAN-EUROPE COMMUNICATIONS N.V.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

11. SEGMENT AND GEOGRAPHIC INFORMATION (CONTINUED)
focuses on providing cable television, DTH, internet and telephony services to
residential customers and is comprised of the local operating systems. cHELLO
BROADBAND serves as the internet access provider, and was recently combined with
the programming businesses led by UPCtv under one management team as UPC Media.
PRIORITY TELECOM is focused on providing services to business customers. Amounts
included in Corporate, IT and Other relate primarily to centralized activities
which support multiple platforms/services.

    The Company evaluates performance and allocates resources based on the
results of these business units. The key operating performance criteria used in
this evaluation includes revenue growth and net operating loss before
depreciation, amortization and stock-based compensation expense ("Adjusted
EBITDA"). Industry analysts generally consider EBITDA to be a helpful way to
measure the performance of cable television operations and communications
companies. Management believes Adjusted EBITDA helps investors to assess the
cash flow from operations from period to period and thus value the Company's
business. Adjusted EBITDA should not, however, be considered a replacement for
net income, cash flows or any other measure of performance or liquidity under
generally accepted accounting principles, or as an indicator of a company's
operating performance. The presentation of Adjusted EBITDA may not be comparable
to statistics with a similar name reported by other companies. Not all companies
and analysts calculate Adjusted EBITDA in the same manner. As the Company
increases its bundling of products, the allocation of indirect operating and
SG&A expenses between individual products will become increasingly difficult and
may not represent the actual Adjusted EBITDA for individual products.

    A summary of the segment information by geographic area is as follows:

<TABLE>
<CAPTION>
                                                   REVENUE FOR THE THREE MONTHS ENDED MARCH 31, 2001
                             ----------------------------------------------------------------------------------------------
                               CABLE                  INTERNET/                            CORPORATE,    INTER-
                             TELEVISION   TELEPHONY     DATA        DTH      PROGRAMMING   IT & OTHER   COMPANY     TOTAL
                             ----------   ---------   ---------   --------   -----------   ----------   --------   --------
<S>                          <C>          <C>         <C>         <C>        <C>           <C>          <C>        <C>
Corporate..................          -          -           -           -           -           905           -        905
UPCtv......................          -          -           -           -       3,144             -      (1,436)     1,708
CHELLO BROADBAND...........          -          -      13,209           -           -             -     (12,671)       538
PRIORITY TELECOM...........          -     58,910           -           -           -             -     (11,692)    47,218
Distribution:
  The Netherlands..........     61,358     15,696      15,469           -           -        10,064      (9,560)    93,027
  Austria..................     20,845     10,618      11,066           -           -         2,779      (2,710)    42,598
  Belgium..................      3,904          -       2,203           -           -             -           -      6,107
  Czech Republic...........      8,159        215         214       1,767         820           431        (820)    10,786
  Norway...................     12,351      1,654       1,825           -           -           523        (523)    15,830
  Hungary..................     14,463      5,802         476       1,851       2,402             -      (2,402)    22,592
  France...................     14,882      4,384       1,449           -           -             -           -     20,715
  Poland...................     20,356          -         223      17,581      17,453             -     (17,025)    38,588
  Sweden...................      8,439          -       2,415           -           -             -           -     10,854
  Germany..................     12,330         11          15           -           -           731           -     13,087
  Other....................      8,218          -         157         516       1,698             4      (1,698)     8,895
                               -------     ------      ------      ------      ------        ------     -------    -------
Total......................    185,305     97,290      48,721      21,715      25,517        15,437     (60,537)   333,448
                               =======     ======      ======      ======      ======        ======     =======    =======
</TABLE>

                                       15
<PAGE>
                     UNITED PAN-EUROPE COMMUNICATIONS N.V.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

11. SEGMENT AND GEOGRAPHIC INFORMATION (CONTINUED)

<TABLE>
<CAPTION>
                                                    REVENUE FOR THE THREE MONTHS ENDED MARCH 31, 2000
                              ----------------------------------------------------------------------------------------------
                                CABLE                  INTERNET/                            CORPORATE,    INTER-
                              TELEVISION   TELEPHONY     DATA        DTH      PROGRAMMING   IT & OTHER   COMPANY     TOTAL
                              ----------   ---------   ---------   --------   -----------   ----------   --------   --------
<S>                           <C>          <C>         <C>         <C>        <C>           <C>          <C>        <C>
Corporate...................          -          -           -          -            -            -            -          -
UPCtv.......................          -          -           -          -          511            -            -        511
CHELLO BROADBAND............          -          -       5,431          -            -            -       (5,381)        50
PRIORITY TELECOM............          -      9,552           -          -            -            -            -      9,552
Distribution:
  The Netherlands...........     43,290      9,469       5,254          -            -            -            -     58,013
  Austria...................     20,697      5,754       5,597          -            -            -            -     32,048
  Belgium...................      3,644        278         812          -            -            -            -      4,734
  Czech Republic............      6,278        258           -          -            -        1,035            -      7,571
  Norway....................     12,263        403         404          -            -            -            -     13,070
  Hungary...................     11,766      5,299          58          -            -            -            -     17,123
  France....................     14,080      1,875         409          -            -            -            -     16,364
  Poland....................     17,258          -           -      9,610       13,014            -      (12,566)    27,316
  Sweden....................      8,220          -         845          -            -            -            -      9,065
  Germany...................          -          -           -          -            -            -            -          -
  Other.....................      3,937          -           -          -            -          246            -      4,183
                                -------     ------      ------      -----       ------        -----      -------    -------
Total.......................    141,433     32,888      18,810      9,610       13,525        1,281      (17,947)   199,600
                                =======     ======      ======      =====       ======        =====      =======    =======
</TABLE>

<TABLE>
<CAPTION>
                                               ADJUSTED EBITDA FOR THE THREE MONTHS ENDED MARCH 31, 2001
                                  -----------------------------------------------------------------------------------
                                    CABLE                  INTERNET/                            CORPORATE,
                                  TELEVISION   TELEPHONY     DATA        DTH      PROGRAMMING   IT & OTHER    TOTAL
                                  ----------   ---------   ---------   --------   -----------   ----------   --------
<S>                               <C>          <C>         <C>         <C>        <C>           <C>          <C>
Corporate.......................         -            -           -          -            -      (22,690)    (22,690)
UPCtv...........................         -            -           -          -      (15,364)           -     (15,364)
CHELLO BROADBAND................         -            -     (20,197)         -            -            -     (20,197)
PRIORITY TELECOM................         -      (21,552)          -          -            -            -     (21,552)
Distribution:
  The Netherlands...............    29,820       (4,323)     (4,343)         -            -      (14,099)      7,055
  Austria.......................     8,603        1,278       2,356          -            -        2,084      14,321
  Belgium.......................     1,572            -        (493)         -            -            -       1,079
  Czech Republic................     2,684          (29)       (297)    (1,415)        (487)         182         638
  Norway........................     4,220       (1,393)       (842)         -            -          523       2,508
  Hungary.......................     5,036        3,177        (398)    (1,338)      (1,339)           -       5,138
  France........................        60       (4,550)     (1,952)         -            -            -      (6,442)
  Poland........................       443            -      (1,308)    (1,982)      (9,375)        (587)    (12,809)
  Sweden........................     1,990            -        (938)         -            -         (100)        952
  Germany.......................     6,215          (10)       (164)         -            -         (584)      5,457
  Other.........................     3,224            -         142       (790)        (974)        (504)      1,098
                                    ------      -------     -------     ------      -------      -------     -------
Total...........................    63,867      (27,402)    (28,434)    (5,525)     (27,539)     (35,775)    (60,808)
                                    ======      =======     =======     ======      =======      =======     =======
</TABLE>

                                       16
<PAGE>
                     UNITED PAN-EUROPE COMMUNICATIONS N.V.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

11. SEGMENT AND GEOGRAPHIC INFORMATION (CONTINUED)

<TABLE>
<CAPTION>
                                               ADJUSTED EBITDA FOR THE THREE MONTHS ENDED MARCH 31, 2000
                                  -----------------------------------------------------------------------------------
                                    CABLE                  INTERNET/                            CORPORATE,
                                  TELEVISION   TELEPHONY     DATA        DTH      PROGRAMMING   IT & OTHER    TOTAL
                                  ----------   ---------   ---------   --------   -----------   ----------   --------
<S>                               <C>          <C>         <C>         <C>        <C>           <C>          <C>
Corporate.......................         -            -           -          -            -      (22,701)    (22,701)
UPCtv...........................         -            -           -          -       (7,647)           -      (7,647)
CHELLO BROADBAND................         -            -     (27,149)         -            -            -     (27,149)
PRIORITY TELECOM................         -       (2,649)          -          -            -            -      (2,649)
Distribution:
  The Netherlands...............    21,472      (11,939)     (5,279)         -            -            -       4,254
  Austria.......................    11,244       (1,126)        168          -            -            -      10,286
  Belgium.......................     1,461         (141)     (1,134)         -            -            -         186
  Czech Republic................       928           23           -          -            -          416       1,367
  Norway........................     4,905       (1,863)       (849)         -            -            -       2,193
  Hungary.......................     3,644        2,940      (1,069)         -            -            -       5,515
  France........................     1,517       (2,746)       (986)         -            -            -      (2,215)
  Poland........................     1,072            -           -     (4,343)     (14,609)        (324)    (18,204)
  Sweden........................     3,736         (705)     (2,086)         -            -            -         945
  Germany.......................         -            -           -          -            -            -           -
  Other.........................     1,667         (180)     (1,699)         -          (64)      (1,310)     (1,586)
                                    ------      -------     -------     ------      -------      -------     -------
Total...........................    51,646      (18,386)    (40,083)    (4,343)     (22,320)     (23,919)    (57,405)
                                    ======      =======     =======     ======      =======      =======     =======
</TABLE>

    Following is a reconciliation of Adjusted EBITDA to UPC's net loss before
income taxes:

<TABLE>
<CAPTION>
                                                              FOR THE THREE MONTHS
                                                                 ENDED MARCH 31,
                                                              ---------------------
                                                                2001        2000
                                                              ---------   ---------
<S>                                                           <C>         <C>
Adjusted EBITDA.............................................   (60,808)    (57,405)
Depreciation and amortization...............................  (245,179)   (130,703)
Stock-based compensation....................................    (1,062)    (52,038)
                                                              --------    --------
  Net operating loss........................................  (307,049)   (240,146)
Interest income.............................................    15,755      13,373
Interest expense............................................  (218,219)   (140,393)
Foreign exchange gain (loss) and other income (expense),
  net.......................................................   (55,105)    (79,953)
                                                              --------    --------
  Net loss before income taxes and other items..............  (564,618)   (447,119)
Share in results of affiliated companies, net...............   (46,096)    (21,215)
Minority interests in subsidiaries..........................    18,841         984
                                                              --------    --------
  Net loss before income tax benefit (expense) and
    cumulative effect of change in accounting principle.....  (591,873)   (467,350)
                                                              ========    ========
</TABLE>

                                       17
<PAGE>
                     UNITED PAN-EUROPE COMMUNICATIONS N.V.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

11. SEGMENT AND GEOGRAPHIC INFORMATION (CONTINUED)

<TABLE>
<CAPTION>
                                                                    TOTAL ASSETS
                                                              -------------------------
                                                                AS OF         AS OF
                                                              MARCH 31,    DECEMBER 31,
                                                              -------------------------
                                                                 2001          2000
                                                              ----------   ------------
<S>                                                           <C>          <C>
Corporate...................................................   2,759,338     2,775,411
UPCtv.......................................................      80,939        70,043
CHELLO BROADBAND............................................     108,891       118,746
PRIORITY TELECOM............................................   1,055,322       630,418
Distribution:
  The Netherlands...........................................   2,487,544     2,929,364
  Austria...................................................     471,578       464,174
  Belgium...................................................      46,619        46,463
  Czech Republic............................................     232,968       231,122
  Norway....................................................     322,400       319,324
  Hungary...................................................     370,037       376,722
  France....................................................     923,998       914,385
  Poland....................................................   1,346,925     1,316,945
  Sweden....................................................     432,794       453,231
  Germany...................................................   1,030,272     1,044,344
  Other.....................................................     128,451       111,679
                                                              ----------    ----------
Total.......................................................  11,798,076    11,802,371
                                                              ==========    ==========
</TABLE>

    The total assets of Priority Wireless are included in PRIORITY TELECOM, as
historically Priority Wireless was included in PRIORITY TELECOM as an out-reach
technology.

12. COMPREHENSIVE INCOME (LOSS)

    The components of total comprehensive income (loss) are as follows:

<TABLE>
<CAPTION>
                                                              FOR THE THREE MONTHS
                                                                 ENDED MARCH 31,
                                                              ---------------------
                                                                2001        2000
                                                              ---------   ---------
<S>                                                           <C>         <C>
Net loss....................................................  (556,434)   (467,371)
Other comprehensive income (loss):
  Change in cumulative translation adjustments..............    16,283      36,101
  Change in unrealized gain (loss) on investments...........    38,038      48,762
                                                              --------    --------
    Total comprehensive income (loss).......................  (502,113)   (382,508)
                                                              ========    ========
</TABLE>

13. BASIC NET LOSS ATTRIBUTABLE TO COMMON SHAREHOLDERS

<TABLE>
<CAPTION>
                                                              FOR THE THREE MONTHS
                                                                 ENDED MARCH 31,
                                                              ---------------------
                                                                2001        2000
                                                              ---------   ---------
<S>                                                           <C>         <C>
Net loss....................................................  (556,434)   (467,371)
Accretion of Series 1 convertible preferred stock...........   (29,761)         --
                                                              --------    --------
Basic net loss attributable to common shareholders..........  (586,195)   (467,371)
                                                              ========    ========
</TABLE>

                                       18
<PAGE>
ITEM 2--MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
  OF OPERATIONS

    The following discussion, contains, in addition to historical information,
forward-looking statements that involve risks and uncertainties. These
forward-looking statements may include statements concerning our plans,
objectives and future economic prospects, expectations, beliefs, future plans
and strategies, anticipated events or trends and similar expressions concerning
matters that are not historical facts. These forward-looking statements involve
both known and unanticipated risks, uncertainties and other factors that may
cause our actual results, performance or achievements, or industry results, to
be materially different from what we say or imply with the forward-looking
statements. These factors include, among other things, changes in television
viewing preferences and habits by our subscribers and potential subscribers,
their acceptance of new technology, programming alternatives and new video
services we may offer. They also include our ability to complete announced
transactions, our ability to secure adequate capital to fund system growth, new
businesses and acquisitions and to manage and grow our newer telephony, digital
and internet/data services. These forward-looking statements apply only as of
the time of this report and we have no obligation or plans to provide updates or
revisions to these forward-looking statements or any other changes in events or
circumstances on which these forward-looking statements are based. The following
discussion and analysis of financial condition and results of operations covers
the three months ended March 31, 2001 and 2000, and should be read together with
our consolidated financial statements and related notes included elsewhere
herein. These consolidated financial statements provide additional information
regarding our financial activities and condition.

                                  INTRODUCTION

    We own and operate broadband communications networks or services in 17
countries in Europe and in Israel. Our operations are organized into three
principal divisions. UPC Distribution, which comprises our local operating
systems, delivers video, telephony and internet services to our residential
customers. UPC Media comprises our internet access and converging internet
content and programming businesses, which provide their products and services to
us, as well as to third parties. PRIORITY TELECOM, which will target the
business market, is our third principal division. Our subscriber base is the
largest of any group of broadband communications networks operated across
Europe. Our goal is to enhance our position as a leading pan-European
distributor of video programming services and to become a leading pan-European
provider of telephony, internet and enhanced video services, offering a one-stop
shopping solution for residential and business communication needs. We plan to
achieve this goal by increasing the penetration of our new services, such as
digital video, telephony and internet.

    Since formation, we have developed largely through acquisitions. The most
recent acquisitions have resulted in significant growth in our consolidated
revenues and expenditures.

                                       19
<PAGE>
    The following table summarizes our larger acquisitions since January 1,
2000.

<TABLE>
<CAPTION>
                             INTEREST                                        CLOSING                  PURCHASE
OPERATING COMPANIES          ACQUIRED           LOCATION                      DATE                     PRICE
-------------------          --------   ------------------------   ---------------------------   ------------------
                                                                                                 (MILLIONS OF EURO)
<S>                          <C>        <C>                        <C>                           <C>
Primacom AG................    25.0%    Germany                    December 1999 - March 2000            344.2
SBS........................    10.2%    pan-European                            February 2000            162.5
Intercomm(5)...............     100%    France                                  February 2000            100.0
Tebecai....................     100%    The Netherlands                         February 2000             62.2
ElTele stfold / Vestfold...     100%    Norway                                     March 2000             39.3
Kabel Haarlem B.V..........     100%    The Netherlands                            March 2000             62.2
Eneco K&T Group............     100%    The Netherlands                            March 2000          1,046.3(2)
UPC Magyarorszag(1)........   20.75%    Hungary                                    March 2000             63.9
DattelKabel................     100%    Czech Republic                              July 2000             24.5
EWT/TSS Group(3)...........     100%    Germany                                  October 2000            953.4
Cignal Global
  Communications(4)........     100%    United States of America                November 2000            235.7
Alkmaar....................     100%    The Netherlands                          January 2001             49.2
</TABLE>

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

(1) We acquired the 20.75% of UPC Magyarorszag which we did not already own.

(2) Including acquisition of loans to former shareholder.

(3) We acquired 100% of EWT/TSS through our 51% owned subsidiary UPC Germany for
    a preliminary purchase price of 238.4 million in cash and 49% of UPC
    Germany.

(4) We acquired 100% of Cignal Global Communications in exchange for a 16%
    interest in our subsidiary Priority Telecom in a stock-based transaction.

(5) We acquired 100% of Intercomm France Holding S.A., in exchange for a 8%
    interest in UPC France and 36.0 million in cash.

ANNOUNCEMENT OF MERGER WITH PRIMACOM

    On March 29, 2001, we announced an agreement with PrimaCom to merge our
German assets, including EWT/TSS and the Telecolumbus option, as well as our
Alkmaar subsidiary located in the Netherlands, with those of PrimaCom. The
proposed transaction is subject to approval by the PrimaCom shareholders, as
well as various regulatory and other approvals. The merger is expected to close
in the third quarter of 2001. If PrimaCom is deemed the "acquirer" for purposes
of accounting for this proposed transaction, our investment in the merged
companies would be required to be recorded at fair value as of the date of the
transaction. Our carrying value of EWT/TSS could be significantly higher than
the fair value of our investment in the merged companies if and when the
transaction is consummated.

SERVICES

    To date, our primary source of revenue has been analog video entertainment
services to residential customers. We believe that an increasing percentage of
our future revenues will come from telephony, internet and digital video
services within the residential market, as well as expanding to the business
customer. These are forward-looking statements and will not be fulfilled unless
our new services grow dramatically. Capital constraints, technological
limitations, competition, lack of programming, loss of personnel, adverse
regulation and many other factors could prevent our new services from growing as
we expect. The introduction of telephony services and internet services had a
significant negative impact on Adjusted EBITDA during 2000 and 1999. We expected
this negative impact due to the high costs associated with obtaining
subscribers, branding and launching these new services against the incumbent
operator. This negative impact is expected to decline. We intend for these new
businesses to be Adjusted EBITDA positive after two to three years following
introduction of the service, but there can be no assurance this will occur. We
believe that our new services will continue to have a negative impact on
Adjusted EBITDA due to the one-time costs associated with obtaining customers.

                                       20
<PAGE>
    UPC DISTRIBUTION-VIDEO.  We currently offer our subscribers a wide choice of
pay-tv services. We plan to continue to improve our expanded basic tier
offerings by adding new channels and where possible, migrating popular
commercial channels into an expanded basic tier service. In addition, we plan to
offer subscribers additional choice by offering thematic groupings of tiered
video services in a variety of genres. In many systems, we have introduced
impulse pay-per view services.

    We are currently launching digital services in some of our markets. The
increased channel capacity in digitalisation will enable us to offer subscribers
more choice in pay-tv services, as well as transactional television and
interactive services. We intend to offer transactional television services, such
as near-video-on-demand (``NVOD") and video-on-demand (``VOD"). We have launched
NVOD in the Netherlands. We plan to offer interactive services, such as
electronic program guides (``EPG"), walled garden, basic email functionality and
interactive television games. We also intend to provide our subscribers with
customisable programming guides that would enable them to program their favorite
channels and also allow parents to restrict their children's viewing habits. The
increased channel capacity provided by digitalisation will enable subscribers to
customer their subscriptions to our services to suit their lifestyles.

    UPC DISTRIBUTION-VOICE.  We provide local national and international long
distance voice telephony services to residential customers. Our operating
systems offer a full complement of telephony services to residential customers,
including caller ID, call waiting, call forwarding, call blocking, distinctive
ringing and three-way calling.

    UPC DISTRIBUTION-INTERNET.  We operate our internet business locally through
our operating companies. Our local operating companies provide subscribers with
high-speed internet access via their cable modem. We provide subscribers
cable-based internet access that is always-on for a flat fee. In 2001, we plan
to introduce network monitoring tools. These tools will allow us to
comprehensively monitor our stated fair-use policy, and will also enable us to
offer more sophisticated products for heavy users.

    UPC MEDIA.  We recently combined the management of our internet access and
content group, CHELLO BROADBAND, and our programming business led by UPCtv, to
form a new division, UPC Media. In addition to internet access and pay
television, UPC Media will develop interactive services and transactional tv for
our digital product.

    CHELLO BROADBAND provides our local operating companies and non-affiliated
local operators with access to the internet gateway and additional services,
such as high speed connectivity, caching, local language broadband portals, and
marketing support, through franchise agreements. During 1999 and 2000,
substantially all of CHELLO's revenues were subscription based and derived from
our local operating companies. These intercompany revenues have been eliminated
in our consolidated operating results. We believe we have an opportunity to
increase non-affiliated revenue through the CHELLO BROADBAND service in future
years. We cannot predict whether our products and services, including broadband
internet services in general, will become accepted or profitable in these
markets. At March 31, 2001, CHELLO BROADBAND had approximately 401,400
subscribers, including 17,500 non-UPC affiliates.

    We plan to deploy interactive products which will support our planned
digital roll-out across Europe, including broadband portal services,
interactive/enhanced television, walled garden, e-commerce and entertainment and
internet on the television. We also plan to deploy transactional television
services, which include NVOD and VOD. In addition, UPCtv has developed and
launched eight pay-per-view channels of various genres since May 1999. We have
constructed a pan-European digital distribution platform designed for the state
of the art production and the digital distribution of our new channels and other
signals to our upgraded networks. During 1999 and 2000, substantially all of our
programming businesses' revenues were subscription-based and derived from our
local operating companies. These intercompany revenues have been eliminated in
our consolidated operating results.

                                       21
<PAGE>
We believe we have an opportunity to grow non-affiliated revenue through the
media group's service in future years. We cannot predict whether our products
and services, will become accepted or profitable in these markets. We believe
these businesses will become increasingly inter-dependent and overlapping.

    PRIORITY TELECOM.  PRIORITY TELECOM offers telephony services to business
customers. Services vary per country, covering the range of voice, data, IP and
hosting. In the course of 2000, PRIORITY TELECOM brought together a separate
management team responsible for the provisioning of these services to business
customers. At March 31, 2001, PRIORITY TELECOM had approximately 6,000
customers.

PRICING

    UPC DISTRIBUTION-VIDEO.  We usually charge a one-time installation fee when
we connect video subscribers, a monthly subscription fee that depends on whether
basic or expanded basic tier service is offered, and incremental amounts for
those subscribers purchasing pay-per-view and premium programming. For our
digital set-top computer, we anticipate collecting a customer deposit as
security.

    UPC DISTRIBUTION-VOICE.  Revenue from residential telephony services usually
consists of a flat monthly line rental and a usage charge based upon minutes. In
order to achieve high-growth from early market entry, we price our telephony
service at a discount compared to services offered by incumbent
telecommunications operators. Initially, we will also waive or substantially
discount installation fees.

    UPC DISTRIBUTION-INTERNET.  To date, virtually all of our revenues have been
derived from monthly subscription fees. Most local operators have chosen to
waive installation charges, although in most instances we collect a customer
deposit. In the future, we expect to generate revenues from advertising and
e-commerce as we develop our digital set-top computer services. Currently, our
services are offered to residential subscribers at flat subscription fees.
Following the introduction of bandwidth monitoring tools, we anticipate charging
tiered pricing levels which more accurately reflect the individual consumption
of bandwidth. For business subscribers to services other than our standard
broadband internet access services, we generally agree the pricing with local
operators on a case by case basis, depending on the size and capacity
requirements of the businesses.

    UPC MEDIA.  CHELLO BROADBAND provides internet access and other services for
a fee based upon a percentage of subscription revenue. For our programming
channels, including our UPCtv and some Wizja TV channels, we charge cable
operators on a per-subscriber basis. Charges for transactional television are
per transaction.

    PRIORITY TELECOM.  Pricing may differ per type of service rendered. Revenue
from voice services usually consist of a flat monthly fee plus a usage based
charge. Data, IP and hosting services are typically billed flat by month.

COSTS OF OPERATIONS

    UPC DISTRIBUTION-VIDEO.  Direct operating costs include the costs of
programming, which are variable, based on the number of subscribers. The cost
per subscriber is established by negotiation between us and the program supplier
or rates negotatiated by cable associations. Indirect operating costs include
franchise fees and operating expenses necessary to provide service to the
subscriber. Franchise fees, where applicable, are typically based upon a
percentage of revenue. Other operating expenses include personnel, service
vehicles, maintenance and facilities. Selling, general and administrative
expenses includes branding, marketing and customer acquisition costs, personnel
related costs, such as stock-based compensation expense, legal and accounting,
human resources, office facilities and other overhead costs.

                                       22
<PAGE>
    UPC DISTRIBUTION-VOICE.  Direct operating costs include interconnection
costs and number portability fees. Interconnection costs are variable based upon
usage as determined through negotiated interconnection agreements. Indirect
operating costs include network operations, customer operations and customer
care. Selling, general and administrative expenses includes branding, marketing
and customer acquisition costs, personnel related costs, such as stock-based
compensation expense, legal and accounting, human resources, office facilities
and other overhead costs.

    UPC DISTRIBUTION-INTERNET.  Direct operating costs for our local operating
companies include the franchise fee paid to CHELLO BROADBAND for internet
access. Indirect operating costs include personnel, service vehicles,
maintenance and facilities. Selling, general and administrative expenses include
branding, marketing, customer acquisition costs, personnel-related costs,
including stock-based compensation expenses, legal and accounting, office
facilities and other overhead.

    UPC MEDIA.  Operating costs for CHELLO BROADBAND'S access consist primarily
of leased-line and network related costs. Operating costs for our interactive
television, transactional services and pay television groups within UPC Media
include the costs of programming rights, portal design and development,
production costs, and distribution costs, including transponder fees and
operating costs. A significant portion of these costs are fixed in nature
through contracts commitments. Selling, general and administrative expenses
include branding, marketing, personnel-related costs, legal and accounting,
office facilities and other overhead costs.

    PRIORITY TELECOM.  Operating costs include costs of installation of our
customers and costs of ownership and management of our part of the network.
Selling, general and administrative expenses include branding, marketing,
customer acquisition costs, personnel-related costs, including stock-based
compensation expenses, legal and accounting, office facilities and other
overhead.

                                       23
<PAGE>
    The following table presents an overview of our revenue and Adjusted EBITDA
by segment for the three months ended March 31, 2001 and 2000.

<TABLE>
<CAPTION>
                                                                  FOR THE THREE
                                                                   MONTHS ENDED
                                                                    MARCH 31,
                                                              ----------------------
                                                                2001          2000
                                                              --------      --------
                                                                 (IN THOUSANDS OF
                                                                      EUROS)
<S>                                                           <C>           <C>
Revenue:
UPC Distribution
  Cable tv..................................................  185,305       141,433
  Telephone(2)..............................................   38,380        23,336
  Internet..................................................   35,512        13,379
  DTH.......................................................   21,715         9,610
  Other.....................................................   14,532         1,281
  Intercompany Eliminations.................................  (12,793)            -
                                                              -------       -------
Total Distribution..........................................  282,651       189,039
PRIORITY TELECOM(2).........................................   58,910         9,552
CHELLO BROADBAND............................................   13,209         5,431
Programming.................................................   25,517        13,525
Corporate, IT and Other.....................................      905             -
Intercompany Eliminations...................................  (47,744)      (17,947)
                                                              -------       -------
                                                              333,448       199,600
                                                              =======       =======

Adjusted EBITDA(1):
UPC Distribution
  Cable tv..................................................   63,867        51,646
  Telephone(2)..............................................   (5,850)      (15,737)
  Internet..................................................   (8,237)      (12,934)
  DTH.......................................................   (5,525)       (4,343)
  Other.....................................................  (13,085)       (1,218)
                                                              -------       -------
Total Distribution..........................................   31,170        17,414
PRIORITY TELECOM(2).........................................  (21,552)       (2,649)
CHELLO BROADBAND............................................  (20,197)      (27,149)
Programming.................................................  (27,539)      (22,320)
Corporate, IT and Other.....................................  (22,690)      (22,701)
                                                              -------       -------
                                                              (60,808)      (57,405)
                                                              =======       =======
</TABLE>

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

(1) Adjusted EBITDA represents net operating loss before depreciation,
    amortization and stock-based compensation charges. Industry analysts
    generally consider EBITDA to be a helpful way to measure the performance of
    cable television operations and communications companies. Management
    believes Adjusted EBITDA helps investors to assess the cash flow from
    operations from period to period and thus value the Company's business.
    Adjusted EBITDA should not, however, be considered a replacement for net
    income, cash flows or any other measure of performance or liquidity under
    generally accepted accounting principles, or as an indicator of a company's
    operating performance. The presentation of Adjusted EBITDA may not be
    comparable to statistics with a similar name reported by other companies.
    Not all companies and analysts calculate Adjusted EBITDA in the same manner.

                                       24
<PAGE>
(2) For the three months ended March 31, 2000, the revenue and Adjusted EBITDA
    for our CLEC activities in the Netherlands, Austria and Belgium has been
    reclassified from UPC Distribution-Telephony to Priority CLEC, which is
    consistent with the presentation for the three months ended March 31, 2001.

UPC DISTRIBUTION

    REVENUE

    For the three months ended March 31, 2001, revenue from UPC Distribution
increased 93.7 million to 282.7 million, from 189.0 million for the three months
ended March 31, 2000, a 49.6% increase. Of the increase, 43.9 million is from
cable television, 15.1 million is from telephony, 22.1 million is from internet,
12.1 million is from DTH and 0.5 million is from other, net of related
intercompany eliminations. The increase in cable television revenue of
43.9 million is primarily due to increased subscribers from our acquisition of
K&T (the Netherlands), which we include in our consolidated results effective
March 31, 2000, and our acquisition of EWT (Germany), which we include in our
consolidated results effective October 1, 2000. Cable television revenue from
K&T and EWT included in our consolidated results for the three months ended
March 31, 2001, totalled 28.4 million, compared to nil for the three months
ended March 31, 2000. The remaining increase in cable television revenue relates
to organic subscriber growth, and to a lesser extent increased rates.

    The increase in telephony revenue of 15.1 million primarily relates to
organic subscriber growth. Residential telephony subscribers increased from
approximately 253,000 at March 31, 2000 to approximately 440,000 at March 31,
2001.

    The increase in internet revenue of 22.1 million primarily relates to
organic subscriber growth.   Internet subscribers increased from approximately
177,000 at March 31, 2000 to approximately 409,000 at March 31, 2001. We
continued to increase subscribers in systems where we had launched internet
services prior to January 1, 2000. In addition, we launched internet in the
second half of 2000, in Poland, Hungary and the Czech Republic.

    The increase in DTH revenue of 12.1 million primarily relates to organic
subscriber growth.   DTH subscribers increased from approximately 304,000 at
March 31, 2000 to approximately 466,000 at March 31, 2001. The majority of the
increase relates to our Polish DTH system, which we acquired and began
consolidating effective August 1, 1999. In addition, in the second half of 2000,
we launched DTH service in our systems in Hungary, the Czech Republic and the
Slovak Republic, leveraging off our existing DTH platform in Poland.

    Other revenue for the three months ended March 31, 2001, is primarily
revenue recognized for the provision of network related services to PRIORITY
TELECOM. UPC Distribution and PRIORITY TELECOM have entered into agreements for
the provision by UPC Distribution of network, maintenance and operations. This
intercompany revenue eliminates in our consolidated results. For the three
months ended March 31, 2000, other revenue primarily relates to the rental of
facilities and other.

    ADJUSTED EBITDA

    For the three months ended March 31, 2001, Adjusted EBITDA from UPC
Distribution increased 13.8 million to 31.2 million, from 17.4 million for the
three months ended March 31, 2000, a 79.3% increase. Of the increase,
12.3 million is from cable television, 9.8 million is from telephony and
4.7 million is from internet. These increases were partially offset by decreases
of 1.2 million in DTH and 11.9 million in other. The increase in cable
television Adjusted EBITDA of 12.3 million is primarily due to our acquisition
of K&T (the Netherlands), which we include in our consolidated results effective
March 31, 2000, and our acquisition of EWT (Germany), which we include in our
consolidated results effective October 1, 2000. Cable television Adjusted EBITDA
from K&T and EWT

                                       25
<PAGE>
included in our consolidated results for the three months ended March 31, 2001,
totaled 16.4 million, compared to nil for the three months ended March 31, 2000.

    The increase in telephony and internet Adjusted EBITDA of 9.8 million and
4.7 million, respectively primarily relates to organic subscriber growth, which
has allowed us to realize economies of scale. In addition, we have realized
costs savings from continued integration and restructuring of operations, as
well as lower start-up costs.

    The decrease in DTH Adjusted EBITDA of 1.2 million primarily relates to
start-up costs for the launch of DTH in our systems in Hungary, the Czech
Republic and the Slovak Republic in the second half of 2000. The decrease in
Adjusted EBITDA for these systems was partially offset by increased Adjusted
EBITDA in our Polish system from subscriber growth, as well as a decrease in
costs.

    Other Adjusted EBITDA for the three months ended March 31, 2001, is
primarily related to development and start-up costs for our digital services, as
well as regional costs. In the fourth quarter of 2000 we soft-launched our
digital product in the Netherlands. Adjusted EBITDA associated with the launch
of our digital services includes costs related to sales and marketing, training,
and customer care and totalled for the three months ended March 31, 2001, to a
negative 13.6 million. For the three months ended March 31, 2000, other Adjusted
EBITDA primarily relates to regional office cost.

PRIORITY TELECOM

    REVENUE

    For the three months ended March 31, 2001, revenue from PRIORITY TELECOM
increased 49.3 million to 58.9 million, from 9.6 million for the three months
ended March 31, 2000. The increase in revenue is primarily due to acquisitions.
In November 2000, we completed the acquisition of Cignal and began consolidating
its operations. In addition, UPC Distribution acquired K&T and began
consolidating its results effective March 31, 2000. The CLEC related assets of
K&T have been spun-off to PRIORITY TELECOM, and its revenue is included in
PRIORITY TELECOM's results for the three months ended March 31, 2001.

    ADJUSTED EBITDA

    For the three months ended March 31, 2001, Adjusted EBITDA from PRIORITY
TELECOM decreased 19.0 million to a negative 21.6 million, from a negative
2.6 million for the three months ended March 31, 2000. The decrease is primarily
due to the acquisition of Cignal and costs for the development and launch of
products within its markets. For the three months ended March 31, 2000, Adjusted
EBITDA primarily related to limited CLEC operations, as well as costs for
PRIORITY WIRELESS. Historically, PRIORITY WIRELESS was included in PRIORITY
TELECOM as an out-reach technology.

CHELLO BROADBAND

    REVENUE

    For the three months ended March 31, 2001, revenue from CHELLO BROADBAND
increased 7.8 million to 13.2 million, from 5.4 million for the three months
ended March 31, 2000. The increase in revenue is primarily due to increased
internet subscribers. We continued to increase internet subscribers in UPC
Distributions' systems, which have a franchise agreement with CHELLO BROADBAND.
In addition, UPC Distribution launched CHELLO BROADBAND's services in Poland and
Hungary in the second half of 2000.

    In general, CHELLO BROADBAND receives 40% of subscription-based revenue for
its services from the local operator. Intercompany revenues are eliminated in
our consolidated operating results. Intercompany revenues for the three months
ended March 31, 2001 and 2000 were 12.7 million and nil million, respectively.

                                       26
<PAGE>
    ADJUSTED EBITDA

    For the three months ended March 31, 2001, Adjusted EBITDA from CHELLO
BROADBAND increased 6.9 million to a negative 20.2 million, from a negative
27.1 million for the three months ended March 31, 2000. The improvement in
Adjusted EBITDA primarily relates to continued subscriber growth, as well as
decreased start-up and development costs for launching a new service, and costs
efficiencies from the integration and restructuring of operations.

PROGRAMMING

    REVENUE

    For the three months ended March 31, 2001, revenue from our programming
businesses increased 12.0 million to 25.5 million, from 13.5 million for the
three months ended March 31, 2000. The increase primarily relates to increased
revenue from the launch of sports channels in Central and Eastern Europe,
increased revenue from our Polish programming, as well as increased revenue from
UPCtv. Our Central and Eastern Europe sports channels were launched in the
second half of 2000. For the three months ended March 31, 2000, programming
revenue was primarily from our Polish programming.

    In general, programming revenue relates to programming provided to UPC
Distribution. Intercompany revenues are eliminated in our consolidated operating
results. Intercompany revenues for the three months ended March 31, 2001 and
2000 were 23.4 million and 12.6 million, respectively.

    ADJUSTED EBITDA

    For the three months ended March 31, 2001, Adjusted EBITDA from our
programming business decreased 5.2 million to a negative 27.5 million, from a
negative 22.3 million for the three months ended March 31, 2000. The decrease in
Adjusted EBITDA primarily relates to costs related to the development of our
channel business, UPCtv. In addition, the launch of the sports channels in
Central and Eastern Europe in the second half of 2000 contributed to the
decrease in Adjusted EBITDA.

CORPORATE, IT AND OTHER

    ADJUSTED EBITDA

    For both the three months ended March 31, 2001 and the three months ended
March 31, 2000, Adjusted EBITDA from corporate, IT and other was a negative
22.7 million. Adjusted EBITDA for corporate, IT and other includes costs of our
corporate functions, such as corporate development, investor relations, finance,
legal, regulatory and marketing. Adjusted EBITDA for corporate, IT and other
also includes costs related to the development and roll-out of our pan-European
financial and customer care systems. Other costs include in corporate, IT and
other include development costs, such as costs related to the development of our
digital set-top computer, and investigation of new technologies, such as NVOD,
voice-over IP telephony and satellite.

DEPRECIATION AND AMORTIZATION

    During the three months ended March 31, 2001, our depreciation and
amortization expense increased 114.5 million to 245.2 million from
130.7 million for the three months ended March 31, 2000, a 87.6% increase. Of
this increase, approximately 36.4 million, relates to increased amortization
expense for goodwill created in connection with acquisitions in 2000.
Depreciation expense also increased due to the acquisitions which closed during
2000, which we have consolidated, as well as additional depreciation expense on
capital expenditures to upgrade the network in our Western European systems and
new-build for developing systems.

                                       27
<PAGE>
INTEREST INCOME

    During the three months ended March 31, 2001 as compared to the three months
ended March 31, 2000, interest income increased 2.4 million to 15.8 million from
13.4 million, a 17.9% increase. The increase is due to a higher average cash
balance during the three months ended March 31, 2001.

INTEREST EXPENSE

    During the three months ended March 31, 2001 as compared to the three months
ended March 31, 2000, interest expense increased 77.8 million to 218.2 million
from 140.4 million, a 55.4% increase. The increase in 2001 is primarily due to
our borrowings under the UPC Distribution Bank Facility and the UPC Bridge
Facility. A significant amount of our interest expense in 2001 relates to
accretion on our discount notes, which is not currently cash pay.

<TABLE>
<CAPTION>
                                                              FOR THE THREE MONTHS
                                                                 ENDED MARCH 31,
                                                              ---------------------
                                                                2001        2000
                                                              ---------   ---------
<S>                                                           <C>         <C>
Cash Current Pay:
  Bank......................................................   (74,518)    (11,786)
  Senior Notes..............................................   (72,150)    (71,837)
  Other.....................................................         -        (749)
                                                              --------    --------
                                                              (146,668)    (84,372)
Non-Cash Accretion:
  Discount Notes............................................   (62,901)    (49,289)
  Redeemed DIC Loan.........................................         -      (3,092)
  New DIC Loan..............................................      (169)          -
  Deferred Financing........................................    (8,481)     (3,640)
                                                              --------    --------
                                                               (71,551)    (56,021)
                                                              --------    --------
Total Interest Expense......................................  (218,219)   (140,393)
                                                              ========    ========
</TABLE>

FOREIGN EXCHANGE GAIN (LOSS) AND OTHER INCOME (EXPENSE)

    Foreign exchange gain (loss) and other income (expense), net, reflected a
loss of 55.1 million for the three months ended March 31, 2001, compared to a
loss of 80.0 million for the three months ended March 31, 2000. The decrease was
primarily due to a gain of 47.5 million relating to the valuation of the
compound swaps in connection with the adoption of SFAS 133. This gain was
partially offset by a foreign exchange loss during the three months ended
March 31, 2001 from the increased value of the US dollar against the Euro,
subsequent to December 31, 2000.

CUMULATIVE EFFECT OF ACCOUNTING CHANGE

    Effective January 1, 2001, we adopted SFAS 133, which establishes accounting
and reporting standards for derivative instruments, including certain derivative
instruments embedded in other contracts and for hedging activities. All
derivatives, whether designated in hedging relationships or not, are required to
be recorded on the balance sheet at fair value. The adoption of SFAS 133 on
January 1, 2001, resulted in a cumulative increase to income of 35.3 million and
a cumulative increase to other Comprehensive Income (``OCI") of 36.7 million.
The increase to income was attributable to a loss of approximately 36.7 million
reclassified from OCI for value of certain warrants held by the Company which
are derivatives which are not designated as a hedging instrument and income of
approximately 72.0 million related to gains associated with the cross currency
swaps which are held by

                                       28
<PAGE>
us which do not qualify as hedging instruments as defined by SFAS 133. We use
derivative instruments to manage exposures to foreign currency and interest rate
risks.

SHARE IN RESULTS OF AFFILIATED COMPANIES, NET

    For the three months ended March 31, 2001, our share in net losses of
affiliated companies increased 24.9 million to 46.1 million from 21.2 million
for the three months ended March 31, 2000, a 117.5% increase. The increase was
primarily due to increased losses from SBS, Primacom and Tevel.

                            STATEMENTS OF CASH FLOWS

    We had cash and cash equivalents of 1,129.5 million as of March 31, 2001, an
increase of 414.2 million from 715.3 million as March 31, 2000.

CASH FLOWS FROM OPERATING ACTIVITIES

    During the three months ended March 31, 2001, net cash flow used in
operating activities was 428.4 million compared to a use of 33.5 million for the
comparable period in 2000. This increase was primarily related to increased
increased inventory and decreased current liabilities.

CASH FLOWS FROM INVESTING ACTIVITIES

    We used 206.6 million of net cashflow in investing activities during the
three months ended March 31, 2001, compared to 1,949.3 million for the three
months ended March 31, 2000. During the period ended March 31, 2001 cash was
used to acquire Alkmaar for 22.9 million, net of cash acquired. Capital
expenditures represented 177.7 million, excluding approximately 34.6 million
relating to increased inventory, that once placed in service will be transferred
to property, plant and equipment.

    During the three months ended March 31, 2000, cash was used principally for
acquisitions, including K&T, for 1,046.3 million, net of cash acquired, UPC
Magyaroszag for 63.9 million, net of cash acquired, Tebecai for 62.2 million,
net of cash acquired, Haarlem for 62.2 million, net of cash acquired and other
acquisitions totaling 112.7 million, net of cash acquired. Capital expenditures
represented 253.2 million. During this period we made a net investment in
affiliates of 304.3 million, including our acquisitions of an additional 10.5%
interest in SBS for 162.5 million, shares in Primacom AG for 123.6 million and
other investments in affiliates of 18.2 million. We also made a net investment
in @Entertainment bonds and other securities of 44.5 million.

CASH FLOWS FROM FINANCING ACTIVITIES

    We had 173.8 million of cash flows from financing activities during the
three months ended March 31, 2001, compared to 1,672.6 million for three months
ended March 31, 2000. The principal source of cash was a drawdown of
200.0 million from the UPC Distribution Bank Facility. We paid down
26.2 million of various long and short-term debt facilities.

    The principal source of cash for the three months ended March 31, 2000, was
net proceeds from our senior notes and discount notes offering in January 2000
of 1,594.2 million. Additional sources of cash were from long-term and
short-term borrowings of 139.5 million and 268.0 million, respectively.
Long-term borrowings included borrowings under the UPC Senior Credit Facility of
62.5 million and other borrowings of 77.0 million. We used proceeds of
231.4 million from the New A2000 Facility to pay off the existing A2000
Facilities. We had additional proceeds from short-term debt of 36.6 million,
including 32.9 million from the GelreVision facility. We paid down other
long-term and short-term loans of 297.3 million. During the three months ended
March 31, 2000 we incurred deferred financing costs of 31.8 million.

                                       29
<PAGE>
                       CONSOLIDATED CAPITAL EXPENDITURES

    Since 1995, we have been upgrading our existing cable television system
infrastructure and constructing our new-build infrastructure with two-way high
capacity technology to support digital video, telephony and internet/data
services. Capital expenditures for the upgrade and new-build construction can be
reduced at our discretion, although such reductions require lead-time in order
to complete work-in-progress and can result in higher total costs of
construction.

    In addition to the network infrastructure and related equipment and capital
resources described above, development of our newer businesses, CHELLO
BROADBAND, PRIORITY TELECOM, our digital distribution platform and DTH,
including expansion into Central Europe, construction and development of our
pan-European distribution and programming facilities, including our origination
facility, network operating center and related support systems and equipment
require capital expenditures.

                        LIQUIDITY AND CAPITAL RESOURCES

    Historically, we have financed our operations and acquisitions primarily
from:

    - cash contributed by United upon our formation,

    - debt financed at the UPC corporate level and project debt financed at the
      operating company level,

    - equity raised in our initial public offering, secondary offering and
      private offering of convertible preference shares,

    - debt raised in our July 1999, October 1999 and January 2000 offering of
      senior notes and senior discount notes, and

    - operating cash flow.

    Our distribution business has historically been funded by bank loans and
will continue to be in the future, primarily from the UPC Distribution Bank
Facility. Our service divisions, including CHELLO BROADBAND, programming and
PRIORITY TELECOM have been funded through equity and bonds.

RESTRICTIONS UNDER OUR JULY 1999, OCTOBER 1999 AND JANUARY 2000 INDENTURES

    Our activities are restricted by the covenants of our indentures dated
July 30, October 29, 1999 and January 20, 2000, under which senior notes and
senior discount notes were issued. Among other things, our indentures place
certain limitations on our ability, and the ability of our subsidiaries, to
borrow money, pay dividends or repurchase stock, make investments, create
certain liens, engage in certain transactions with affiliates, and sell certain
assets or merge with or into other companies.

    Under the terms of our indentures, if we raise additional paid-in equity, we
will be permitted to incur additional debt.

RESTRICTIONS UNDER UNITED INDENTURES

    As a subsidiary of United, our activities are restricted by the covenants in
United's indentures dated February 5, 1998 and April 29, 1999. Among other
things, the United indentures place certain limitations on our ability, and the
ability of our subsidiaries, to borrow money, pay dividends or repurchase stock,
make investments, create certain liens, engage in certain transactions with
affiliates, and sell certain assets or merge with or into other companies. The
United indentures generally place limitations on the additional amount of debt
that we or our subsidiaries or controlled affiliates may borrow, preferred
shares that we or they may issue, and the amount and type of investments we may
make.

                                       30
<PAGE>
SOURCES OF CAPITAL

    We had 1,129.5 million of unrestricted cash and cash equivalents on hand as
of March 31, 2001. In addition, we had borrowing capacity at the corporate and
project debt level. In 2000, we raised approximately 7.6 billion, and gained
access to an additional 2.8 billion from a combination of banks, bonds and
equity markets. We intend to continue to access these sources of capital, as
well as other less traditional sources including vendor financing, equity
partners, and leasing structures. We believe our access to sources of capital
will be sufficient to satisfy future cash requirements, although there can be no
assurance that this will be the case.

    On January 20, 2000, we closed an offering of our 11 1/2% senior notes due
2010, our 11 1/4% senior notes due 2010 and our 13 3/4% senior discount notes
due 2010. The offering generated gross proceeds of approximately Euro
1.6 billion. Proceeds from the bond offering were used for working capital and
other general corporate purposes, including acquisitions of businesses and
possible investments.

    In January 2000, UPC Nederland (A2000), refinanced its existing bank
facilities with a one year term-loan bridge facility of 231.4 million and a one
year revolving credit bridge facility of 49.9 million, subject to certain
availability covenants. In October 2000, we repaid this facility with the
proceeds from the UPC Distribution Bank Facility.

    At the end of March 2000 a fully committed Euro 2 billion stand-by revolving
credit facility was provided. The facility is guaranteed by UPC and certain
subsidiaries. The facility bears interest at EURIBOR +6.0%-7.0%, stepping up
after March 31, 2001, with periodic increases capped at an annual rate of 18.0%.
An annual commitment fee of 0.5% is applicable over the undrawn amount. A
drawing fee ranging from 1.5% to 2.0% is applicable for each drawing. The
commitment terminated on December 31, 2000, and the facility reaches maturity on
March 29, 2007. We borrowed 750 million on this facility prior to December 31,
2000.

    On April 7, 2000, Mediareseaux refinanced its existing debt and the existing
debt of Videopole and RCF with a Euro 250 million bridge facility. The
refinancing of the Rhone Vision Cable Credit Facility with this facility was
completed in the fourth quarter of 2000. In October 2000, we repaid this
facility with the proceeds from the UPC Distribution Bank Facility.

    In connection with the Eneco K&T acquisition, UPC Nederland received a
short-term bridge loan of Euro 500 million secured with guarantees of certain of
our Dutch assets. Drawdowns of the UPC Bridge Loan refinanced certain existing
inter-company loans from UPC N.V. In October 2000, we repaid this facility with
the proceeds from the UPC Distribution Bank Facility.

    In October 2000, we closed a Euro 4.0 billion operating and term loan
facility ("The UPC Distribution Bank Facility"). The facility is guaranteed by
existing cable operating companies, excluding Polish and German assets. The UPC
Distribution Bank Facility bears interest at EURIBOR +0.75%-4.0% depending on
certain leverage ratios, and we pay an annual commitment fee of 0.5% over the
undrawn amount. The facility was widely syndicated to a group of more then 50
European and American (Banking) institutions. A first drawing was made in
October 2000, to refinance existing operating company bank debt totaling
Euro 2.0 billion. The UPC Distribution Bank Facility will finance further
digital rollout and triple play by our existing cable companies, excluding
Polish and German operations, subject to availability. Additional availability
is linked to certain performance tests. We believe that additional availability
by the end of 2001 will increase to a level equal to approximately one-half of
the undrawn amount under this facility at the end of 2000. The facility also
contains certain leverage and revenue covenants. Principal repayment will begin
in 2004. The facility reaches final maturity in 2009. At March 31, 2001,
Euro 2.6 billion was outstanding under this facility.

    In December 2000, we sold Euro 1.43 billion worth of convertible preference
shares and warrants for cash, to a group of investors, including United.

                                       31
<PAGE>
RIGHTS OFFERING

    On February 23, 2001, UPC announced a Euro 1.0 billion shareholder rights
offering and the Euro 1.0 billion "backstop" subscription commitment of United,
our majority shareholder. The rights offering and United's subscription
commitment are subject to completion of a separate transaction between United
and Liberty Media Corp. ("Liberty"), also announced on 23 February. UPC
understands that United and Liberty have agreed in principle to revised terms to
their planned transaction. While UPC must await disclosure of the outcome of
this agreement before providing definitive guidance on this proposed capital
raising, it remains confident that it will receive Euro 1.0 billion, or the
equivalent in another currency, of financing in connection with the
Liberty/United transaction.

                            CERTAIN DUTCH TAX ISSUES

    One of our Dutch systems was assessed for a transfer tax on immovable
property in the amount of Euro 0.8 million for the purchase of a cable network.
We have always regarded our cable networks as movable property and not subject
to such transfer tax. We are appealing this tax assessment. Should we be
unsuccessful, our Dutch systems may be assessed for taxes on similar
transactions. We cannot predict the extent to which the taxes could be assessed
retroactively or the amount of tax that our systems may be assessed for,
although it may be substantial, being 6% of the value attributable to our
systems at the date of transfer. Because we own 100% of UPC Nederland, any tax
liabilities assessed against our Dutch systems will be consolidated with our
results. We believe that, if our appeal is unsuccessful, most cable television
companies and other utilities in The Netherlands would become subject to similar
tax liabilities. If this happens, we expect these entities would lobby the Dutch
tax authorities with us against such tax assessments. We cannot assure that such
lobbying would be successful.

    In October 1999, the Dutch tax authorities issued an assessment on the 1995
tax return of one of our subsidiaries. The assessment, on a taxable amount of
approximately 36.3 million, resulted in a tax payable of approximately
12.7 million. The Dutch tax authorities indicated that this assessment was
issued to reserve the rights of the Dutch tax authorities pending expiration of
time under the statute of limitations. The assessment does not express an
opinion of the Dutch tax authorities on the taxes due and is still subject to
discussion. We filed an appeal against the assessment to defend our tax filing
position.

              INFLATION AND FOREIGN CURRENCY EXCHANGE RATE LOSSES

    To date, we have not been impacted materially by inflation.

    The value of our monetary assets and liabilities is affected by fluctuations
in foreign currency exchange rates as accounts payable for certain equipment
purchases and certain operating expenses, such as DTH and programming expenses,
are denominated in currencies other than the functional currency of the entity
making such payments. We and some of our operating companies have notes payable
and notes receivable that are denominated in, and loans payable that are linked
to, a currency other than their own functional currency, exposing us to foreign
currency exchange risks on these monetary assets and liabilities. Historically,
we and our operating companies have not hedged our exposure to foreign currency
exchange rate operating risks. Accordingly, from time to time, we will
experience economic loss and a negative impact on earnings and equity with
respect to our holdings solely as a result of foreign currency exchange rate
fluctuations. In connection with our offerings of senior notes in July 1999,
October 1999 and January 2000, we entered into cross-currency swap agreements,
exchanging dollar-denominated notes for Euro-denominated notes.

    The functional currency for our operations generally is the applicable local
currency for each operating company. We have consolidated operations in
countries outside of the European Monetary Union including Norway, Sweden,
Poland, Hungary, Romania, the Czech Republic and the Slovak

                                       32
<PAGE>
Republic and operations which report in US dollars. Assets and liabilities of
foreign subsidiaries are translated at the exchange rates in effect at
period-end, and the statements of operations are translated at the average
exchange rates during the period. Exchange rate fluctuations on translating
foreign currency financial statements into Euros result in unrealized gains or
losses referred to as translation adjustments. Cumulative translation
adjustments are recorded as a separate component of shareholders' equity.
Transactions denominated in currencies other than the local currency are
recorded based on exchange rates at the time such transactions arise. Subsequent
changes in exchange rates result in transaction gains and losses which are
reflected in income as unrealized, based on period-end translations, or realized
upon settlement of the transactions.

    Cash flows from our operations in foreign countries are translated based on
their reporting currencies. As a result, amounts related to assets and
liabilities reported on the consolidated statements of cash flows will not agree
with changes in the corresponding balances on the consolidated balance sheets.
The effects of exchange rate changes on cash balances held in foreign currencies
are reported as a separate line below cash flows from financing activities.

                      EUROPEAN ECONOMIC AND MONETARY UNION

    On January 1, 1999, eleven of the fifteen member countries of the European
Union established fixed conversion rates between their existing sovereign
currencies and the Euro. The participating countries adopted the Euro as their
common legal currency on that day. The Euro trades on currency exchanges and is
available for non-cash transactions during the transition period between
January 1, 1999 and January 1, 2002. During this transition period, the existing
currencies are scheduled to remain legal tender in the participating countries
as denominations of the Euro and public and private parties may pay for goods
and services using either the Euro or the participating countries' existing
currencies.

    During the transition period, within countries who have adopted the Euro,
all operating companies' billing systems will include amounts in Euro as well as
the respective country's existing currency. We do not expect the introduction of
the Euro to affect materially our cable television and other operations.

                                       33
<PAGE>
ITEM 3--QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

INVESTMENT PORTFOLIO

    As of March 31, 2001, we have cash and cash equivalents of approximately
1,129.5 million. We have invested this cash in highly liquid instruments, which
meet high credit quality standards with original maturities at the date of
purchase of less than three months. These investments will be subject to
interest rate risk and foreign exchange fluctuations (with respect to amounts
invested in currencies outside the European Monetary Union) however, the Company
does not expect any material losses with respect to its investment portfolio.

IMPACT OF FOREIGN CURRENCY RATE CHANGES

    We are exposed to foreign exchange rate fluctuations related to our monetary
assets and liabilities, including those of our operating subsidiaries, which are
denominated in currencies outside of the European Monetary Union. Our exposure
to foreign exchange rate fluctuations also arises from intercompany charges.

    The table below provides information about UPC's and its consolidated
subsidiaries' foreign currency exchange risk for debt which is denominated in
foreign currencies outside of the European Monetary Union as of December 31,
2001, including cash flows based on the expected repayment date and related
weighted-average interest rates for debt. The information is presented in Euro
equivalents, which is the Company's reporting currency. The instruments' actual
cash flows are denominated in US Dollars.

<TABLE>
<CAPTION>
                                        AMOUNT OUTSTANDING                       EXPECTED REPAYMENT
                                       AS OF MARCH 31, 2001                      AS OF DECEMBER 31,
                                      -----------------------   ----------------------------------------------------
                                      BOOK VALUE   FAIR VALUE     2001       2002       2003       2004       2005
                                      ----------   ----------   --------   --------   --------   --------   --------
                                                                  (EUROS, IN THOUSANDS)
<S>                                   <C>          <C>          <C>        <C>        <C>        <C>        <C>
DOLLAR DENOMINATED FACILITIES
UPC SENIOR DISCOUNT NOTES DUE
  2009..............................   557,669      284,086           -          -          -          -          -
  Average interest rate.............     12.50%       22.44%
UPC SENIOR DISCOUNT NOTES DUE
  2009..............................   341,596      179,319           -          -          -          -          -
  Average interest rate.............    13.375%       22.28%
UPC SENIOR DISCOUNT NOTES DUE
  2010..............................   683,207      363,776           -          -          -          -          -
  Average interest rate.............    13.750%       21.71%
UPC SENIOR NOTES DUE 2010...........   677,557      446,762           -          -          -          -          -
  Average interest rate.............     11.25%       18.80%
UPC DISTRIBUTION BANK FACILITY USD
  TRANCHE...........................   122,206      122,206           -          -          -      1,222      1,222
  LIBOR +4%
  Average interest rate.............     10.20%       10.20%
PCI NOTES...........................    17,138       17,138           -          -     17,138          -          -
  Average interest rate.............     9.875%        15.6%
@ENTERTAINMENT 1998 SENIOR DISCOUNT
  NOTES.............................   170,219      108,017           -          -          -          -          -
  Average interest rate.............     14.50%       24.73%
@ENTERTAINMENT 1999 SENIOR DISCOUNT
  NOTES.............................   151,905       91,191           -          -          -          -          -
  Average interest rate.............     14.50%       24.73%
@ENTERTAINMENT 1999 SERIES C SENIOR
  DISCOUNT NOTES....................    16,692       16,692           -          -          -          -          -
  Average interest rate.............         7%        14.2%
</TABLE>

                                       34
<PAGE>
    Occasionally we will execute hedge transactions to reduce our exposure to
foreign currency exchange rate risks. In connection with our offerings of senior
notes in July 1999, October 1999, January 2000 and the UPC Distribution Bank
Facility, we entered into cross-currency swap agreements, exchanging
dollar-denominated debt for Euro denominated debt.

INTEREST RATE SENSITIVITY

    The table below provides information about our financial instruments that
are sensitive to changes in interest rates as of March 31, 2001, including cash
flows based on the expected repayment dates and the related weighted-average
interest rates. The information is presented in Euro equivalents, as the Euro is
our reporting currency.

<TABLE>
<CAPTION>
                                       AMOUNT OUTSTANDING                       EXPECTED REPAYMENT
                                      AS OF MARCH 31, 2001                      AS OF DECEMBER 31,
                                     -----------------------   ----------------------------------------------------
                                     BOOK VALUE   FAIR VALUE     2001       2002       2003       2004       2005
                                     ----------   ----------   --------   --------   --------   --------   --------
                                                                 (EUROS, IN THOUSANDS)
<S>                                  <C>          <C>          <C>        <C>        <C>        <C>        <C>
VARIABLE RATE FACILITIES
UPC 10.875% SENIOR NOTES DUE
  2009.............................    909,401      584,315          -          -          -          -          -
  EURIBOR + 4.15% and 8.54%,
    average rate in 2001 of 9.07%
    and 8.54%
  Average interest rate............     10.875%       18.88%
UPC 10.875% SENIOR NOTES DUE
  2007.............................    227,350      146,647          -          -          -          -          -
  EURIBOR + 4.8% and 9.92%, average
    rate in 2001 of 10% and 9.92%
  Average interest rate............     10.875%       19.77%
UPC 11.25% SENIOR NOTES DUE 2009...    284,646      184,775          -          -          -          -          -
  EURIBOR + 4.8% and 9.92%, average
    rate in 2001 of 10% and 9.92%
  Average interest rate............      11.25%       18.93%
UPC BRIDGE FACILITY................    750,000      750,000          -          -          -          -          -
  EURIBOR + 7%
  Average interest rate............      11.85%       11.85%
UPC DISTRIBUTION BANK FACILITY.....  2,585,260    2,585,260          -          -          -    348,650    697,900
  EURIBOR/USD LIBOR + 0.75%-4%
  Average interest rate............       8.09%        8.09%
</TABLE>

                                       35
<PAGE>

<TABLE>
<CAPTION>
                                        AMOUNT OUTSTANDING                       EXPECTED REPAYMENT
                                       AS OF MARCH 31, 2001                      AS OF DECEMBER 31,
                                      -----------------------   ----------------------------------------------------
                                      BOOK VALUE   FAIR VALUE     2001       2002       2003       2004       2005
                                      ----------   ----------   --------   --------   --------   --------   --------
                                                                  (EUROS, IN THOUSANDS)
<S>                                   <C>          <C>          <C>        <C>        <C>        <C>        <C>
FIXED RATE FACILITIES
UPC SENIOR NOTES DUE 2009...........   300,000      195,000           -          -          -          -          -
  Average interest rate.............    10.875%       19.54%
UPC SENIOR DISCOUNT NOTES DUE
  2009..............................   557,669      284,086           -          -          -          -          -
  Average interest rate.............      12.5%       22.44%
UPC SENIOR DISCOUNT NOTES DUE
  2009..............................   341,596      179,319           -          -          -          -          -
  Average interest rate.............    13.375%       22.28%
UPC SENIOR DISCOUNT NOTES DUE
  2009..............................   120,140       66,850           -          -          -          -          -
  Average interest rate.............    13.375%       22.16%
UPC SENIOR NOTES DUE 2007...........   100,000       67,000           -          -          -          -          -
  Average interest rate.............    10.875%       19.59%
UPC SENIOR NOTES DUE 2009...........   100,360       64,640           -          -          -          -          -
  Average interest rate.............     11.25%       19.74%
UPC SENIOR DISCOUNT NOTES DUE
  2010..............................   683,207      363,776           -          -          -          -          -
  Average interest rate.............     13.75%       21.71%
UPC SENIOR NOTES DUE 2010...........   338,800      223,381           -          -          -          -          -
  Average interest rate.............     11.50%       18.82%
UPC SENIOR NOTES DUE 2010...........   677,557      446,762           -          -          -          -          -
  Average interest rate.............     11.25%       18.80%
UPC SENIOR NOTES DUE 2009...........   198,682      132,000           -          -          -          -          -
  Average interest rate.............     11.25%       19.12%
PCI NOTES...........................    17,138       17,138           -          -     17,138          -          -
  Average interest rate.............     9.875%        15.6%
@ENTERTAINMENT 1998 SENIOR DISCOUNT
  NOTES.............................   170,219      104,986           -          -          -          -          -
  Average interest rate.............      14.5%       24.73%
@ENTERTAINMENT 1999 SENIOR DISCOUNT
  NOTES.............................   151,905      104,921           -          -          -          -          -
  Average interest rate.............      14.5%       24.73%
@ENTERTAINMENT 1999 SERIES C SENIOR
  DISCOUNT NOTES....................    16,692       16,692           -          -          -          -          -
  Average interest rate.............         7%        14.2%
DIC LOAN............................    53,255       53,255           -     53,255          -          -          -
  Average interest rate.............      10.0%        10.0%
</TABLE>

EQUITY PRICES

    As of March 31, 2001, we are exposed to equity price fluctuations related to
our investment in equity securities. Our investment in United is classified as
available for sale. Changes in the price of the stock are reflected as
unrealized gains (losses) in our statement of shareholders' equity, until such

                                       36
<PAGE>
time as the stock is sold and any unrealized gain (loss) will be reflected in
the statement of operations. Our investments in PrimaCom and SBS are accounted
for under the equity method of accounting.

<TABLE>
<CAPTION>
                                                                                 FAIR VALUE AS OF
                                                              NUMBER OF SHARES    MARCH 31, 2001
                                                              ----------------   ----------------
                                                                (STATED IN THOUSANDS OF EUROS,
                                                                     EXCEPT SHARE AMOUNTS)
<S>                                                           <C>                <C>
United......................................................     5,569,240             83,097
PrimaCom AG.................................................     4,948,039             74,221
SBS.........................................................     6,000,000            132,153
Terayon(1)..................................................     2,000,000             10,373
</TABLE>

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

(1) Represents warrants to acquire shares. Fair value based on Black and Scholes
    model as of March 31, 2001.

    As of March 31, 2001, we are also exposed to equity price fluctuations
related to our debt which is convertible into our ordinary shares. The table
below provides information about our convertible debt, including expected cash
flows and related weighted-average interest rates.

<TABLE>
<CAPTION>
                                                                                         EXPECTED
                                                            AMOUNT OUTSTANDING           REPAYMENT
                                                           AS OF MARCH 31, 2001     AS OF DECEMBER 31,
                                                          -----------------------   -------------------
                                                          BOOK VALUE   FAIR VALUE     2001       2002
                                                          ----------   ----------   --------   --------
                                                                       (EUROS, THOUSANDS)
<S>                                                       <C>          <C>          <C>        <C>
CONVERTIBLE DEBT
DIC LOAN................................................    53,255       53,255           -     53,255
  10% per annum
</TABLE>

                                       37
<PAGE>
                           PART II--OTHER INFORMATION

ITEM 5--OTHER INFORMATION

SUMMARY OPERATING DATA 2001

    The operating data set forth below reflect the aggregate statistics of the
operating systems in which the Company has an ownership interest.

<TABLE>
<CAPTION>
                                                                    AS AT MARCH 31, 2001
                           ------------------------------------------------------------------------------------------------------
                               UPC        HOMES IN                  TWO WAY                                 DIRECT
                             PAID-IN      SERVICE       HOMES        HOMES        BASIC         BASIC      TO HOME      DIGITAL
                            OWNERSHIP       AREA        PASSED     PASSED(1)   SUBSCRIBERS   PENETRATION    (DTH)     SUBSCRIBERS
                           -----------   ----------   ----------   ---------   -----------   -----------   --------   -----------
<S>                        <C>           <C>          <C>          <C>         <C>           <C>           <C>        <C>
MULTI-CHANNEL TV:

  CONSOLIDATED COMPANIES:
  Norway..................      100.0%      529,000      474,400     143,800       331,600      69.9%             -            -
  Sweden..................      100.0%      770,000      421,600     238,600       255,300      60.6%             -            -
  Belgium.................      100.0%      530,000      152,100     152,100       123,800      81.4%             -            -
  France..................       92.0%    2,653,200    1,240,300     430,900       405,900      32.7%             -        8,800
  The Netherlands.........      100.0%    2,578,800    2,465,400   2,030,300     2,272,800      92.2%             -       24,000
  The Netherlands
    (Alkmaar).............      100.0%       47,700       44,100      44,100        40,100      90.9%             -          400
  Austria.................       95.0%    1,168,700      919,700     916,400       488,400      53.1%             -            -
  Germany (EWT/TSS).......       51.0%      781,800      781,800       9,300       575,500      73.6%             -            -
  Poland..................      100.0%    1,950,000    1,855,200     151,800     1,045,400      56.3%       388,800            -
  Hungary................. 98.9-100.0%    1,001,100      876,800     271,800       636,900      72.6%        35,600            -
  Czech Republic.......... 99.9-100.0%      913,000      786,400     179,400       379,100      48.2%        30,400            -
  Romania.................  51.0-70.0%      648,500      450,700           -       287,600      63.8%             -            -
  Slovak Republic......... 95.0-100.0%      517,800      370,800      17,300       318,600      85.9%        11,500            -
                                         ----------   ----------   ---------    ----------                 --------   ----------
    Total consolidated....               14,089,600   10,839,300   4,585,800     7,161,000                  466,300       33,200
                                         ==========   ==========   =========    ==========                 ========   ==========

  NON-CONSOLIDATED COMPANIES:
  Germany (Primacom)
    (2)...................       25.0%    1,916,900    1,916,900     411,000     1,301,700      67.9%             -        5,400
  Israel..................       46.6%      645,300      645,300     400,500       445,000      69.0%             -            -
  Malta...................       50.0%      179,400      179,400           -        83,800      46.7%             -            -
                                         ----------   ----------   ---------    ----------                 --------   ----------
    Total
      non-consolidated....                2,741,600    2,741,600     811,500     1,830,500                        -        5,400
                                         ==========   ==========   =========    ==========                 ========   ==========
  Total...................               16,831,200   13,580,900   5,397,300     8,991,500                  466,300       38,600
                                         ==========   ==========   =========    ==========                 ========   ==========
</TABLE>

                                       38
<PAGE>
SUMMARY OPERATING DATA 2001 (CONTINUED)

<TABLE>
<CAPTION>
                                                                        AS AT MARCH 31, 2001
                                                  -----------------------------------------------------------------
                                                      UPC             SUBSCRIBERS                   LINES
                                                    PAID-IN     ------------------------   ------------------------
                                                   OWNERSHIP    RESIDENTIAL   BUSINESSES   RESIDENTIAL   BUSINESSES
                                                  -----------   -----------   ----------   -----------   ----------
<S>                                               <C>           <C>           <C>          <C>           <C>
CABLE TELEPHONY

  CONSOLIDATED COMPANIES:
  Norway.......................................        100.0%       16,700             -       18,100            -
  France.......................................         92.0%       47,000             -       49,600          600
  The Netherlands..............................        100.0%      145,100             -      177,100            -
  Austria......................................         95.0%      114,600             -      115,900            -
  Germany-EWT/TSS..............................         51.0%          100             -          100            -
                                                                 ---------     ---------    ---------    ---------
    Total cable................................                    323,500             -      360,800          600
                                                                 =========     =========    =========    =========
NON-CABLE TELEPHONY

  CONSOLIDATED COMPANIES:
  The Netherlands (3)..........................        100.0%       44,300         8,800            -            -
  Czech Republic (4)...........................   99.9-100.0%        3,500             -        3,500            -
  Hungary (4)..................................   98.9-100.0%       69,000             -       74,100            -
                                                                 ---------     ---------    ---------    ---------
    Total non-cable............................                    116,800         8,800       77,600            -
                                                                 =========     =========    =========    =========
    Total......................................                    440,300         8,800      438,400          600
                                                                 =========     =========    =========    =========
</TABLE>

<TABLE>
<CAPTION>
                                                                         AS AT MARCH 31, 2001
                                                 --------------------------------------------------------------------
                                                                                           3RD PARTY         DATA
                                                                                              ISP            OVER
                                                    UPC             SUBSCRIBERS          SUBSCRIBERS(5)    SATELLITE
                                                  PAID-IN     ------------------------   --------------   -----------
                                                 OWNERSHIP    RESIDENTIAL   BUSINESSES    RESIDENTIAL     RESIDENTIAL
                                                 ----------   -----------   ----------   --------------   -----------
<S>                                              <C>          <C>           <C>          <C>              <C>
INTERNET

  CONSOLIDATED COMPANIES:
  Norway......................................        100.0%     18,600            -              -             -
  Sweden......................................        100.0%     37,600            -              -             -
  Belgium.....................................        100.0%     17,100        1,100              -             -
  France......................................         92.0%     16,300            -              -             -
  The Netherlands.............................        100.0%    172,600            -         22,200             -
  The Netherlands (Alkmaar)...................        100.0%          -            -          3,000             -
  Austria.....................................         95.0%    112,200        1,700              -             -
  Germany (EWT/TSS)...........................         51.0%          -            -            100             -
  Poland......................................        100.0%      1,600            -              -           200
  Hungary.....................................   98.9-100.0%      5,100            -              -             -
  Czech Republic..............................   99.9-100.0%          -            -          2,600             -
                                                                -------       ------         ------           ---
    Total consolidated........................                  381,100        2,800         27,900           200
                                                                =======       ======         ======           ===

  NON-CONSOLIDATED COMPANIES:
  Germany (Primacom) (2)......................         25.0%          -            -         20,500
                                                                -------       ------         ------           ---
    Total non-consolidated....................                        -            -         20,500             -
                                                                =======       ======         ======           ===
    Total.....................................                  381,100        2,800         48,400           200
                                                                =======       ======         ======           ===
</TABLE>

                                       39
<PAGE>
SUMMARY OPERATING DATA 2000

   The operating data set forth below reflects the aggregate statistics of the
operating systems in which the Company has an ownership interest.

<TABLE>
<CAPTION>
                                                         AS AT MARCH 31, 2000
                       -----------------------------------------------------------------------------------------
                           UPC         HOMES IN                  TWO WAY                                 DIRECT
                         PAID-IN       SERVICE       HOMES        HOMES        BASIC         BASIC      TO HOME
                        OWNERSHIP        AREA        PASSED     PASSED(1)   SUBSCRIBERS   PENETRATION    (DTH)
                       ------------   ----------   ----------   ---------   -----------   -----------   --------
<S>                    <C>            <C>          <C>          <C>         <C>           <C>           <C>
MULTI-CHANNEL TV:

  CONSOLIDATED COMPANIES:
  Norway.............        100.0%      529,000      468,300      63,800       330,000        70.5%           -
  Sweden.............        100.0%      770,000      421,600     227,000       246,100        58.4%           -
  Belgium............        100.0%      530,000      150,400     147,900       125,600        83.5%           -
  France.............         92.0%    2,105,500    1,081,000     120,600       375,300        34.7%           -
  The Netherlands....        100.0%    2,513,700    2,421,100   1,945,200     2,255,000        93.1%           -
  Austria............         95.0%    1,080,600      907,900     824,300       476,000        52.4%           -
  Poland.............        100.0%    1,950,000    1,769,600           -     1,023,400        57.8%     303,700
  Hungary............   98.9-100.0%    1,001,100      750,300     185,200       550,800        73.4%           -
  Czech Republic.....   99.9-100.0%      868,300      776,900      17,700       364,300        46.9%           -
  Romania............    51.0-70.0%      509,300      391,700           -       261,600        66.8%           -
  Slovak Republic....   95.0-100.0%      417,800      309,200           -       247,500        80.0%           -
                                      ----------   ----------   ---------    ----------                 --------
    Total
    consolidated.....                 12,275,300    9,448,000   3,531,700     6,255,600                  303,700
                                      ==========   ==========   =========    ==========                 ========

  NON-CONSOLIDATED COMPANIES:
  Germany (Primacom)
    (6)..............         25.1%    1,422,800    1,422,800      30,500       919,600        64.6%           -
  Israel.............         46.6%      660,000      617,000     385,400       431,400        69.9%           -
  Malta..............         50.0%      177,000      175,200           -        77,300        44.1%           -
                                      ----------   ----------   ---------    ----------                 --------
                                       2,259,800    2,215,000     415,900     1,428,300                        -
    Total non-consolidated.........
                                      ==========   ==========   =========    ==========                 ========
    Total............                 14,535,100   11,663,000   3,947,600     7,683,900                  303,700
                                      ==========   ==========   =========    ==========                 ========
</TABLE>

                                       40
<PAGE>
SUMMARY OPERATING DATA 2000 (CONTINUED)

<TABLE>
<CAPTION>
                                                                      AS AT MARCH 31, 2000
                                                ----------------------------------------------------------------
                                                   UPC             SUBSCRIBERS                   LINES
                                                 PAID-IN     ------------------------   ------------------------
                                                OWNERSHIP    RESIDENTIAL   BUSINESSES   RESIDENTIAL   BUSINESSES
                                                ----------   -----------   ----------   -----------   ----------
<S>                                             <C>          <C>           <C>          <C>           <C>
CABLE TELEPHONY

  CONSOLIDATED COMPANIES:
  Norway......................................       100.0%      5,300            -         6,000          200
  France......................................        92.0%     18,300            -        18,900          400
  The Netherlands.............................       100.0%     82,300          100        95,400        2,600
  Austria.....................................        95.0%     52,600          500        54,100        2,300
                                                               -------       ------       -------       ------
    Total cable...............................                 158,500          600       174,400        5,500
                                                               =======       ======       =======       ======

NON-CABLE TELEPHONY

  CONSOLIDATED COMPANIES:
  The Netherlands (3).........................        80.0%     23,300        8,400             -            -
  Mundi Telecom...............................        51.0%      3,200        2,200             -            -
  Czech Republic (4)..........................  99.9-100.0%      3,600            -         3,600            -
  Hungary (Monor) (4).........................        97.1%     64,800        3,300        66,900        6,400
                                                               -------       ------       -------       ------
    Total non-cable...........................                  94,900       13,900        70,500        6,400
                                                               =======       ======       =======       ======
    Total.....................................                 253,400       14,500       244,900       11,900
                                                               =======       ======       =======       ======
</TABLE>

                                       41
<PAGE>
SUMMARY OPERATING DATA 2000 (CONTINUED)

<TABLE>
<CAPTION>
                                                                     AS AT MARCH 31, 2000
                                                ---------------------------------------------------------------
                                                                                              3RD PARTY
                                                   UPC            SUBSCRIBERS            ISP SUBSCRIBERS (5)
                                                 PAID-IN    ------------------------   ------------------------
                                                OWNERSHIP   RESIDENTIAL   BUSINESSES   RESIDENTIAL   BUSINESSES
                                                ---------   -----------   ----------   -----------   ----------
<S>                                             <C>         <C>           <C>          <C>           <C>
INTERNET

  CONSOLIDATED COMPANIES:
  Norway......................................    100.0%        4,900         100              -          -
  Sweden......................................    100.0%       11,500           -              -          -
  Belgium.....................................    100.0%        8,900         800              -          -
  France......................................     92.0%        5,000           -              -          -
  The Netherlands.............................    100.0%       80,400       1,900         11,300        200
  Austria.....................................     95.0%       54,500       1,300              -          -
  Hungary.....................................    100.0%          300           -              -          -
                                                              -------       -----         ------        ---
    Total consolidated........................                165,500       4,100         11,300        200
                                                              =======       =====         ======        ===

  NON-CONSOLIDATED COMPANIES:
  Germany (Primacom) (6)......................     25.1%          200           -              -          -
                                                              -------       -----         ------        ---
    Total non-consolidated....................                    200           -              -          -
                                                              -------       -----         ------        ---
    Total.....................................                165,700       4,100         11,300        200
                                                              =======       =====         ======        ===
</TABLE>

SUMMARY OPERATING DATA 2000 AND 2001

RESIDENTIAL RGU'S (7)

    The operating data set forth below reflect the aggregate statistics of the
operating systems in which the Company has an ownership interest.

<TABLE>
<CAPTION>
                                                              AS OF MARCH 31, 2001   AS OF MARCH 31, 2000
                                                                  TOTAL RGU'S            TOTAL RGU'S
                                                              --------------------   --------------------
<S>                                                           <C>                    <C>
Norway......................................................         366,900                340,200
Sweden......................................................         292,900                257,600
Belgium.....................................................         140,900                134,500
France......................................................         478,000                398,600
The Netherlands (8).........................................       2,681,000              2,452,300
The Netherlands (Alkmaar)...................................          43,500                      -
Austria.....................................................         715,200                583,100
Germany (EWT/TSS)...........................................         575,700                      -
Poland......................................................       1,435,800              1,327,100
Hungary.....................................................         746,600                615,900
Czech Republic..............................................         415,600                367,900
Romania.....................................................         287,600                261,600
Slovak Republic.............................................         330,100                247,500
Mundi Telecom (9)...........................................               -                  3,200
                                                                   ---------              ---------
  Total consolidated........................................       8,509,800              6,989,500
                                                                   =========              =========
</TABLE>

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

                                       42
<PAGE>
SUMMARY OPERATING DATA 2000 AND 2001 (CONTINUED)
(1) Two way homes passed represents the number of homes passed where customers
    can request and receive an installation of a two-way addressable set top and
    ``normal" customer services (e.g. the service is launched, customers are
    billed and normal service activity is available).

(2) Statistics of Primacom are as of December 31, 2000.

(3) UTH's 100% subsidiary Uniport was sold in April 2001. As of March 31, 2000,
    UTH owned 80% of Uniport.

(4) Monor and Czech Republic offer traditional telephony service.

(5) Internet subscribers who are not served by CHELLO BROADBAND.

(6) Statistics of Primacom are as of December 31, 1999.

(7) RGU's is the sum of Basic Cable, Digital, Residential Internet, Residential
    Telephony and DTH subscribers.

(8) The Netherlands RGU's include 44,300 Uniport Carrier Select Telephony
    subscribers at March 31, 2001 and 23,300 at March 31, 2000. Uniport was sold
    in April 2001.

(9) In 2001 Mundi Telecom subscribers are included in PRIORITY TELECOM.

                                       43
<PAGE>
ITEM 6--EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits--none

(b) Reports on Form 8-K filed during the Quarter

<TABLE>
<CAPTION>
DATE FILED              DATE OF EVENT                           ITEM REPORTED
----------              -------------           ----------------------------------------------
<S>                     <C>                     <C>
January 26, 2001        January 16, 2001        Item 5--Commencement of consent solicitation
                                                by UPC Polska and Poland Communications, Inc,
                                                with respect to their outstanding bonds.

March 5, 2001*          February 23, 2001       Item 5--Amendment of United/Liberty
                                                Transaction and Announcement of Rights
                                                Offering.
</TABLE>

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

*   As amended on March 6, 2001 to include an exhibit inadvertantly excluded
    from the filing.

                                       44
<PAGE>
                                   SIGNATURE

    Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

<TABLE>
<S>                                                    <C>  <C>
                                                       UNITED PAN-EUROPE COMMUNICATIONS N.V.

                                                       By:          /S/  CHARLES H.R. BRACKEN
                                                            -----------------------------------------
                                                               BOARD OF MANAGEMENT MEMBER AND CHIEF
                                                                 FINANCIAL OFFICER (AND PRINCIPAL
                                                                       ACCOUNTING OFFICER)
                                                                        Date: May 14, 2001
</TABLE>

                                       45