---

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

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FORM 10-Q

(Mark One)

|ý | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ---------------------------------------------------------------------------------------
|  | FOR THE QUARTER ENDED MARCH 31, 2002                                                   

or

|o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------
|  | FOR THE TRANSITION PERIOD FROM  TO
.                                                    

COMMISSION FILE NO. 1-5706

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METROMEDIA INTERNATIONAL GROUP, INC.(Exact name of registrant as specified in its charter)

DELAWARE(State or Other Jurisdiction of
Incorporation or Organization)

58-0971455(I.R.S. Employer
Identification No.)505 Park Avenue, 21st Floor, New York, New York 10022(Address and zip code of principal executive offices)


(212) 527-3800(Registrant's telephone number, including area code)

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INDICATE
BY CHECK MARK WHETHER THE REGISTRANT (1) HAS FILED ALL REPORTS REQUIRED TO BE FILED BY SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 DURING THE PRECEDING 12 MONTHS (OR FOR
SUCH SHORTER PERIOD THAT THE REGISTRANT WAS REQUIRED TO FILE SUCH REPORTS), AND (2) HAS BEEN SUBJECT TO SUCH FILING REQUIREMENTS FOR THE PAST 90 DAYS.
 YES /x/    NO / /

THE
NUMBER OF SHARES OF COMMON STOCK OUTSTANDING AS OF MAY 1, 2002 WAS 94,034,947.

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METROMEDIA INTERNATIONAL GROUP, INC.
Index to
Quarterly Report on Form 10-Q
PART IFINANCIAL INFORMATION

|                                                                                              |  | Page
|--------------------------------------------------------------------------------------------- |  | ----
|Item 1. Financial Statements (unaudited)                                                      |  |     
|Consolidated Condensed Statements of Operations                                               |  | 2   
|Consolidated Condensed Balance Sheets                                                         |  | 3   
|Consolidated Condensed Statements of Cash Flows                                               |  | 4   
|Consolidated Condensed Statement of Stockholders' Equity and Comprehensive Loss               |  | 5   
|Notes to Consolidated Condensed Financial Statements                                          |  | 6   
|Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations |  | 24  
|Item 3. Quantitative and Qualitative Disclosures about Market Risk                            |  | 42  
|PART IIOTHER INFORMATION                                                                    
|Item 1. Legal Proceedings                                                                     |  | 44  
|Item 6. Exhibits and Reports on Form 8-K                                                      |  | 45  
|Signature                                                                                     |  | 46  

1

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METROMEDIA INTERNATIONAL GROUP, INC.    Consolidated Condensed Statements of Operations    (in thousands, except per share amounts)  (unaudited)

|                                                                                                                |                                                           | Three months ended March 31, |        
|--------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------- | ---------------------------- | -------
|
|Revenues:                                                                                                       |                                                           |                              |        
|                                                                                                                | Communications Group                                      |                              | $      
|                                                                                                                | Snapper                                                   |                              |        
|                                                                                                                |                                                           |                              |        
|                                                                                                                |                                                           |                              | 65,537 
|Cost and expenses:                                                                                              |                                                           |                              |        
|                                                                                                                | Cost of sales and operating expensesCommunications Group |                              |        
|                                                                                                                | Cost of sales and operating expensesSnapper              |                              |        
|                                                                                                                | Selling, general and administrative                       |                              |        
|                                                                                                                | Depreciation and amortization                             |                              |        
|                                                                                                                |                                                           |                              |        
|Operating loss                                                                                                  |                                                           |                              | (9,677 
|Other income/(expense):                                                                                         |                                                           |                              |        
|                                                                                                                | Interest expense                                          |                              |        
|                                                                                                                | Interest income                                           |                              |        
|                                                                                                                | Equity in income (losses) of unconsolidated investees     |                              |        
|                                                                                                                | Foreign currency loss                                     |                              |        
|                                                                                                                | Other income                                              |                              |        
|                                                                                                                |                                                           |                              |        
|                                                                                                                |                                                           |                              | (4,922 
|                                                                                                                |                                                           |                              |        
|Loss before income tax expense, minority interest and the cumulative effect of a change in accounting principle |                                                           |                              | (14,599
|Income tax expense                                                                                              |                                                           |                              | (1,819 
|Minority interest                                                                                               |                                                           |                              | (757   
|                                                                                                                |                                                           |                              |        
|Loss from operations before the cumulative effect of a change in accounting principle                           |                                                           |                              | (17,175
|Cumulative effect of a change in accounting principle                                                           |                                                           |                              |       
|                                                                                                                |                                                           |                              |        
|Net loss                                                                                                        |                                                           |                              | (17,175
|Cumulative convertible preferred stock dividend requirement                                                     |                                                           |                              | (3,752 
|                                                                                                                |                                                           |                              |        
|Net loss attributable to common stockholders                                                                    |                                                           | $                            | (20,927
|                                                                                                                |                                                           |                              |        
|Weighted average number of common sharesBasic and diluted                                                      |                                                           |                              | 94,035 
|                                                                                                                |                                                           |                              |        
|Loss per common share attributable to common stockholdersBasic and diluted:                                    |                                                           |                              |        
|Continuing operations                                                                                           |                                                           | $                            | (0.22  
|Cumulative effect of changes in accounting principles                                                           |                                                           |                              |       
|                                                                                                                |                                                           |                              |        
|Net loss                                                                                                        |                                                           | $                            | (0.22  
|                                                                                                                |                                                           |                              |        

See
accompanying notes to consolidated condensed financial statements.

2

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METROMEDIA INTERNATIONAL GROUP, INC.
Consolidated Condensed Balance Sheets
(in thousands)

|                                                 |                                                                                                                                                    | March 31,
2002 |                                            | December 31,
2001 |  
|------------------------------------------------ | -------------------------------------------------------------------------------------------------------------------------------------------------- | -------------- | ------------------------------------------ | ----------------- | -
|
|ASSETS:                                          |                                                                                                                                                    |                |                                            |                   |  
|Current assets:                                  |                                                                                                                                                    |                |                                            |                   |  
|                                                 | Cash and cash equivalents (Note 1)                                                                                                                 |                | $                                          | 25,777            |  
|                                                 | Accounts receivable, net                                                                                                                           |                |                                            | 36,932            |  
|                                                 | Inventories                                                                                                                                        |                |                                            | 65,492            |  
|                                                 | Prepaid expenses and other assets                                                                                                                  |                |                                            | 8,149             |  
|                                                 |                                                                                                                                                    |                |                                            |                   |  
|                                                 |                                                                                                                                                    |                | Total current assets                       |                   |  
|Investments in and advances to business ventures |                                                                                                                                                    |                | 112,867                                    |                   |  
|Property, plant and equipment, net               |                                                                                                                                                    |                | 120,909                                    |                   |  
|Goodwill                                         |                                                                                                                                                    |                | 54,648                                     |                   |  
|Intangible assets, net                           |                                                                                                                                                    |                | 29,116                                     |                   |  
|Other assets                                     |                                                                                                                                                    |                | 4,894                                      |                   |  
|                                                 |                                                                                                                                                    |                |                                            |                   |  
|                                                 |                                                                                                                                                    |                | Total assets                               |                   | $
|                                                 |                                                                                                                                                    |                |                                            |                   |  
|LIABILITIES AND STOCKHOLDERS' EQUITY:            |                                                                                                                                                    |                |                                            |                   |  
|Current liabilities:                             |                                                                                                                                                    |                |                                            |                   |  
|                                                 | Accounts payable                                                                                                                                   |                | $                                          | 16,293            |  
|                                                 | Accrued expenses                                                                                                                                   |                |                                            | 64,363            |  
|                                                 | Current portion of long-term debt                                                                                                                  |                |                                            | 54,896            |  
|                                                 |                                                                                                                                                    |                |                                            |                   |  
|                                                 |                                                                                                                                                    |                | Total current liabilities                  |                   |  
|Long-term debt, less current portion             |                                                                                                                                                    |                | 211,339                                    |                   |  
|Other long-term liabilities                      |                                                                                                                                                    |                | 6,243                                      |                   |  
|                                                 |                                                                                                                                                    |                |                                            |                   |  
|                                                 |                                                                                                                                                    |                | Total liabilities                          |                   |  
|Minority interest                                |                                                                                                                                                    |                | 32,005                                     |                   |  
|Commitments and contingencies                    |                                                                                                                                                    |                |                                            |                   |  
|Stockholders' equity:                            |                                                                                                                                                    |                |                                            |                   |  
|                                                 | 71/4% Cumulative Convertible Preferred Stock                                                                                                       |                |                                            | 207,000           |  
|                                                 | Common Stock, $1.00 par value, authorized 400.0 million shares, issued and outstanding 94.0 million shares at March 31, 2002 and December 31, 2001 |                |                                            | 94,035            |  
|                                                 | Paid-in surplus                                                                                                                                    |                |                                            | 1,102,769         |  
|                                                 | Accumulated deficit                                                                                                                                |                |                                            | (1,323,054        | )
|                                                 | Accumulated other comprehensive loss                                                                                                               |                |                                            | (7,105            | )
|                                                 |                                                                                                                                                    |                |                                            |                   |  
|                                                 |                                                                                                                                                    |                | Total stockholders' equity                 |                   |  
|                                                 |                                                                                                                                                    |                |                                            |                   |  
|                                                 |                                                                                                                                                    |                | Total liabilities and stockholders' equity |                   | $
|                                                 |                                                                                                                                                    |                |                                            |                   |  

See
accompanying notes to consolidated condensed financial statements.

3

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METROMEDIA INTERNATIONAL GROUP, INC.
Consolidated Condensed Statements of Cash Flows
(in thousands)
(unaudited)

|                                                                 |                                   | Three months ended March 31, |       
|---------------------------------------------------------------- | --------------------------------- | ---------------------------- | ------
|
|                                                                 | Cash used in operating activities |                              | $     
|                                                                 |                                   |                              |       
|Investing activities:                                            |                                   |                              |       
|Investments in and advances to business ventures                 |                                   |                              | (206  
|Distributions from business ventures                             |                                   |                              | 949   
|Cash paid for acquisitions and additional equity in subsidiaries |                                   |                              |      
|Additions to property, plant and equipment                       |                                   |                              | (3,689
|                                                                 |                                   |                              |       
|Cash used investing activities                                   |                                   |                              | (2,946
|                                                                 |                                   |                              |       
|Financing activities:                                            |                                   |                              |       
|Proceeds from debt                                               |                                   |                              | 7,561 
|Payments on notes and debt                                       |                                   |                              | (645  
|Preferred stock dividends paid                                   |                                   |                              |      
|                                                                 |                                   |                              |       
|Cash provided by financing activities                            |                                   |                              | 6,916 
|Teleport-TP cash unconsolidated                                  |                                   |                              | (385  
|                                                                 |                                   |                              |       
|Net decrease in cash and cash equivalents                        |                                   |                              | (4,475
|Cash and cash equivalents at beginning of period                 |                                   |                              | 30,252
|                                                                 |                                   |                              |       
|Cash and cash equivalents at end of period                       |                                   | $                            | 25,777
|                                                                 |                                   |                              |       

See
accompanying notes to consolidated condensed financial statements.

4

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METROMEDIA INTERNATIONAL GROUP, INC.
Consolidated Condensed Statement of Stockholders' Equity and Comprehensive Loss
(in thousands)
(unaudited)

|                                         |  | 71/4%
Cumulative Convertible
Preferred Stock |  |   |         |  |        |  |   |        |  |   |           |  |   |            |  
|---------------------------------------- |  | -------------------------------------------- |  | - | ------- |  | ------ |  | - | ------ |  | - | --------- |  | - | ---------- | -
|
|
|
|Balances at December 31, 2001            |  | 4,140                                        |  | $ | 207,000 |  | 94,035 |  | $ | 94,035 |  | $ | 1,102,769 |  | $ | (1,305,879 | )
|Net loss                                 |  |                                             |  |   |        |  |       |  |   |       |  |   |          |  |   | (17,175    | )
|Other comprehensive income, net of tax:  |  |                                              |  |   |         |  |        |  |   |        |  |   |           |  |   |            |  
|Foreign currency translation adjustments |  |                                             |  |   |        |  |       |  |   |       |  |   |          |  |   |           |  
|                                         |  |                                              |  |   |         |  |        |  |   |        |  |   |           |  |   |            |  
|Total comprehensive loss                 |  |                                              |  |   |         |  |        |  |   |        |  |   |           |  |   |            |  
|                                         |  |                                              |  |   |         |  |        |  |   |        |  |   |           |  |   |            |  
|Balances at March 31, 2002               |  | 4,140                                        |  | $ | 207,000 |  | 94,035 |  | $ | 94,035 |  | $ | 1,102,769 |  | $ | (1,323,054 | )
|                                         |  |                                              |  |   |         |  |        |  |   |        |  |   |           |  |   |            |  

See accompanying notes to consolidated condensed financial statements.

5

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Metromedia International Group, Inc.        Notes to Unaudited Consolidated Condensed Financial Statements

1. Basis of Presentation, Going Concern and Recent Developments

Basis of Presentation

The accompanying consolidated financial statements include the accounts of Metromedia International Group, Inc. ("MMG" or the "Company") and its
wholly-owned subsidiaries, Metromedia International Telecommunications, Inc. ("MITI") and Snapper, Inc. ("Snapper") MITI and its subsidiaries, Metromedia China Corporation and PLD
Telekom, Inc., are collectively known as the "Communications Group." All significant intercompany transactions and accounts have been eliminated. Certain reclassifications have been made to the
consolidated condensed financial statements for prior periods to conform to the current presentation.

The
accompanying interim consolidated condensed financial statements have been prepared without audit pursuant to the rules and regulations of the Securities and Exchange Commission.
Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to
such rules and regulations, although the Company believes that the disclosures made are adequate to make the information presented not misleading. These financial statements should be read in
conjunction with the consolidated financial statements and related footnotes included in the Company's Annual Report on Form 10-K for the year ended December 31, 2001. In the
opinion of management, all adjustments, consisting only of normal recurring adjustments, necessary to present fairly the financial position of the Company as of March 31, 2002, and the results
of its operations and its cash flows for the three-month periods ended March 31, 2002 and 2001, have been included. The results of operations for the interim period are not necessarily
indicative of the results which may be realized for the full year.

Going Concern and Recent Developments

The Company is a holding company; accordingly, it does not generate cash flows from operations. As of March 31, 2002 and April 30, 2002, the Company
had $7.3 million and $6.1 million, respectively, in cash at its headquarters level. The Company has suffered recurring net losses and net operating cash deficiencies and does not
presently have sufficient funds on hand to meet its current debt financing obligations. These factors raise substantial doubt about the Company's ability to continue as a going concern. The
consolidated condensed financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Due
to legal and contractual restrictions, a substantial portion of the cash balances in certain of the Company's business ventures and subsidiaries, cannot be readily accessed, if at
all, for the Company's liquidity requirements. Based on the Company's current cash balances and projected internally generated funds, the Company does not believe that it will be able to fund its
operating, investing and financing cash flows through 2002. In addition, the Company currently projects that its cash flow and existing capital resources will not be sufficient, without external
funding or cash proceeds from asset sales, or a combination of both, to pay the September 30, 2002 interest payment on its 101/2% Senior Discount Notes. The principal on the
notes (in a fully accreted amount of $210.6 million) comes due in full on September 30, 2007.

Failure
on the part of the Company to make any required payment of interest or principal on the 101/2% Senior Discount Notes would represent a default under the notes. A
default, if not waived, could result in acceleration of the Company's indebtedness, in which case the full amount of the debt

6

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would become immediately due and payable. If this occurs, the Company would not be able to repay the notes and would likely not be able to borrow sufficient funds to refinance them.

Since
it is possible that Snapper will not be in compliance with all of its financial covenants under its primary bank credit facility during the next four calendar quarters, the Company
has classified, as required under generally accepted accounting principles, all of Snapper's debt to its lenders under the facility in the amount of $53.3 million as a current liability. The
Company may be required to seek amendments to certain financial covenants for future fiscal periods, and, although it has obtained similar amendments in the past, cannot assure you that any such
amendments will be obtained.

Should
Snapper fail to be in compliance with the financial covenants and not obtain a waiver or amendment to the credit facility, it could impair the Company's ability to dispose of
Snapper, and, if the lenders under that credit facility elect to accelerate repayment of Snapper's indebtedness, could result in a default under the indenture for the Senior Discount Notes, and could
materially and adversely affect the Company's results of operations.

In
addition, Snapper sells a significant portion of its products through a network of independent dealers that obtain floor plan financing under an arrangement Snapper has entered into
with a financial institution. If, in the future Snapper fails to be in compliance with its covenants under its bank line of credit, it would be in default under its floor plan financing agreement,
which could result in the program being terminated or curtailed. If the floor plan program is terminated or curtailed, the Company believes that demand for Snapper's products would be curtailed which
could have a material adverse effect on the Company's results of operations, unless the dealers could find alternative financing.

The
Company has been exploring possible asset sales to raise additional cash and has been attempting to maximize cash distributions by its ventures to the Company. However, the Company
cannot assure you that it will be successful in selling any of its assets or that any such sales will raise enough cash to be able to relieve its liquidity issues. The Company is also subject to legal
and contractual restrictions, including those under the indenture for the Senior Discount Notes, on its use of any cash proceeds from sales of its assets or those of its business ventures or
subsidiaries.

Over
the past year, the Company has had periodic discussions with representatives of its noteholders in an attempt to reach agreement on a restructuring of its indebtedness in
conjunction with any proposed asset sales or spinoffs. To date, the noteholders and the Company have not reached any agreement on terms of a restructuring. Discussions between the Company and its
noteholders are continuing, however, and the Company is continuing to examine new restructuring alternatives to present to its noteholders. The Company cannot assure you that these negotiations will
result in a restructuring of its indebtedness.

If
the Company is not able to favorably resolve the liquidity issues described above, the Company would have to resort to certain other measures, including ultimately seeking the
protection afforded under the United States Bankruptcy Code. The Company cannot assure you that it will be successful in meeting its cash requirements or in restructuring its obligations. These
factors raise substantial doubt about our ability to continue as a going concern. The consolidated condensed financial statements do not include any adjustments that might result from the outcome of
this uncertainty.

7

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2. Accounting Changes

Goodwill and Intangible Assets

On January 1, 2002, we adopted SFAS No. 142, "Goodwill and Intangible Assets." SFAS No. 142 eliminates the amortization of goodwill and
intangible assets deemed to have indefinite lives and instead requires that such assets be subject to annual impairment tests. Goodwill amortization (including that of goodwill included in Equity in
losses of unconsolidated subsidiaries) in the first quarter of 2001 totaled $5.7 million ($0.06 per share). The Company has not completed the first step of the transitional goodwill impairment
testing. Such testing is expected to be complete by the end of the second quarter of 2002 as allowed under the provisions of SFAS No. 142.

The
proforma effect as if SFAS No. 142 had been applied during the quarter ended March 31, 2001 is as follows:

Three Months EndedMarch 31, 2002

March 31, 2001(In thousands, except per share data)Net loss attributable to common stockholders as reported

$
(20,927
)
$
(30,089
)Add back:Goodwill amortization expense





4,491Goodwill amortization included in Equity in losses of unconsolidated investees





1,232Proforma net loss attributable to common stockholders


(20,927
)

(24,366
)Add back the cumulative effect of a change in accounting principle to adopt EITF 01-9





2,363Proforma net loss before the cumulative effect of a change in accounting principle to adopt EITF 01-9

$
(20,927
)
$
(22,003
)Loss per share as reportedBasic and diluted

$
(0.22
)
$
(0.32
)Add back:Goodwill amortization expense





0.05Goodwill amortization included in Equity in losses of unconsolidated investees





0.01Adjusted loss per shareBasic and diluted


(0.22
)

(0.26
)Add back the cumulative effect of a change in accounting principle to adopt EITF 01-9





0.03Proforma Basic loss per share before the cumulative effect of a change in accounting principle to adopt EITF 01-9

$
(0.22
)
$
(0.23
)


8

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Intangible
assets other than goodwill after applying the provisions of SFAS No. 142 consist of the following (in thousands):

March 31, 2002

December 31, 2001Licenses

$
48,613

$
69,583Customer lists


2,899


2,899Broadcast rights and other intangibles


6,340


6,34057,852


78,822Less: Accumulated amortization


(28,736
)

(42,628
)$
29,116

$
36,194


Included
in "Investments in and advances to business ventures" at March 31, 2002 and December 31, 2001 are licenses (net of accumulated amortization) totaling
$37.5 million and $34.8 million, respectively.

Intangible
assets and goodwill have been restated to reclassify workforce in place to goodwill as required under SFAS No. 142. Such asset amounted to $1.0 million, net of
accumulated amortization as of March 31, 2002 and December 31, 2001.

All
of the Company's intangible assets (other than goodwill) are subject to amortization. Intangible assets amortization is expected to be $17.7 million (including that related to
license that are carried as part of the Company's "Investments in and advances to business ventures") for each of the next three fiscal years and $9.5 million and $5.9 million for the
following two years, respectively.

In
addition to adopting SFAS No. 142, the Company changed its method of accounting for Teleport-TP which resulted in reclassifications of goodwill and other intangibles. (See
note 6)

Accounting for the Impairment or Disposal of Long-Lived Assets

In August 2001, the Financial Accounting Standards Board issued FASB Statement No. 144, "Accounting for the Impairment or Disposal of
Long-Lived Assets" ("SFAS No. 144"), which supersedes both FASB Statement No. 121, "Accounting for the Impairment of Long-Lived Assets and for Long Lived Assets
to Be Disposed Of" ("SFAS No. 121") and the accounting and reporting provisions of APB Opinion No. 30, "Reporting the Results of OperationsReporting the Effects of Disposal
of a Segment of a Business, and Extraordinary, Unusual and Infrequently Occurring Events and Transactions" (Opinion 30), for the disposal of a segment of a business (as previously defined in that
Opinion). SFAS No. 144 retains the fundamental provisions in SFAS No. 121 for recognizing and measuring impairment losses on long-lived assets held for use and
long-lived assets to be disposed of by sale, while also resolving significant implementation issues associated with SFAS No. 121. For example, SFAS No. 144 provides guidance
on how a long-lived asset that is used as part of a group should be evaluated for impairment, establishes criteria for when a long-lived asset is held for sale, and prescribes
the accounting for a long lived asset that will be disposed of other than by sale. SFAS No. 144 retains the basic provisions of Opinion 30 on how to present discontinued operations in the
income statement but broadens that presentation to include a component of an entity (rather than a segment of a business). Unlike SFAS No. 121, an impairment assessment under SFAS
No. 144 will never result in a write-down of goodwill. Rather, goodwill is evaluated for impairment under SFAS No. 142, "Goodwill

9

---

and Other Intangible Assets". The Company adopted SFAS No. 144 effective January 1, 2002. The adoption of SFAS No. 144 did not have a material impact on the Company's financial
statements.

3. Description of the Business

Communications Group

The Communications Group invests in communications businesses principally in Eastern Europe and the Commonwealth of Independent States ("CIS"). In addition, the
Communications Group has interests in several e-commerce businesses in China. The Communications Group owns interests in and participates with partners in the management of business
ventures that had various operational systems, consisting of cable television systems, wireless telephone systems, fixed and other telephony networks, radio broadcasting stations and other
telephony-related businesses. All of the Communications Group's business ventures other than the businesses of PLD Telekom, Comstar and its China operations report their financial results on a
three-month lag. Therefore, the Communications Group's financial results for March 31 include the financial results for those business ventures for the 3 months ending
December 31.

Snapper

Snapper manufacturers Snapper brand premium-priced power lawnmowers, garden tillers, snow throwers and related parts and accessories. The lawnmowers include rear
engine riding mowers, front engine riding mowers or lawn tractors, and self-propelled and push-type walk-behind mowers. Snapper also manufactures a line of
commercial lawn and turf equipment under the Snapper brand. Snapper provides lawn and garden products through distribution channels to domestic and foreign retail markets. A large percentage of the
residential and commercial sales of lawn and garden equipment are made during a 17-week period from early spring to mid-summer. Although some sales are made to dealers,
distributors and Wal-Mart prior to and subsequent to this period, the largest volume of sales to the ultimate consumer is made during this time. The majority of revenues during the late
fall and winter periods are related to snow thrower shipments.

4. Communications GroupInvestments in and advances to business ventures

General

Advances are made to business ventures and subsidiaries in the form of cash, for working capital purposes, payment of expenses or capital expenditures, or in the
form of equipment purchased on behalf of the business ventures. Interest rates charged to the business ventures and subsidiaries range from prime rate to prime rate plus 6%. The credit agreements
generally provide for the payment of principal and interest from 90% of the business ventures' and subsidiaries' available cash flow, as defined, prior to any substantial distributions of dividends to
the business venture partners. The Communications Group has entered into charter fund and credit agreements with its business ventures and subsidiaries, of which $45.7 million in funding
obligations remain at March 31, 2002. The Communications Group's funding commitments are contingent on its approval of the respective
business ventures' and subsidiaries' business plans. The Company's ability to fund these commitments is dependent on the resolution of its liquidity issues (see Note 1).

10

---

Equity Method Investment Information

At March 31, 2002 and December 31, 2001, the Communications Group's unconsolidated investments in and advances to business ventures by business
line, principally in Eastern Europe and the CIS, at cost, including associated goodwill and net intangible asset balances, and net of adjustments for its equity in earnings or losses, impairment
charges and distributions were as follows (in thousands):

Name

March 31,
2002

December 31,
2001

Ownership
%Fixed Telephony

$
66,712

$
56,686

30-50
%Wireless Telephony


27,305


25,432

35-50
%Cable Television and other Communications Entities


18,850


22,121

30-50
%Total

$
112,867

$
104,239


Included
in Cable Television and other Communications Entities is goodwill totaling $6.3 million as of March 31, 2002 and December 31, 2001.

Summarized
combined financial information of unconsolidated business ventures accounted for under the equity method that have commenced operations as of the dates presented as of
December 31, 2001 and September 30, 2001 (with the exception of Comstar and BELCEL which are not on a 3-month lag) are as follows (in thousands):

Combined Information of Unconsolidated Business Ventures

Combined
Balance Sheets

December 31,
2001

September 30,
2001Assets:Current assets

$
52,545

$
41,530Investments in systems and equipment


158,594


159,929Other assets


1,119


696Total assets

$
212,258

$
202,155Liabilities and Business Ventures' Deficit:Current liabilities

$
68,970

$
63,652Amount payable under credit facility


70,193


74,158Other long-term liabilities


17,058


21,717156,221


159,527Business ventures' equity


56,037


42,628Total liabilities and business ventures' deficit

$
212,258

$
202,155


11

---

Combined
Statements of Operations

Three months ended
December 31,2001

2000Revenues

$
40,658

$
41,573Costs and Expenses:Cost of sales and operating expenses


14,186


16,497Selling, general and administrative


11,078


14,670Depreciation and amortization


11,241


11,884Total expenses


36,505


43,051Operating income (loss)


4,153


(1,478
)Interest expense


(1,631
)

(2,313
)Other income (expense)


22


(1,637
)Foreign currency transactions


(410
)

(674
)Net income (loss)

$
2,134

$
(6,102
)


The
results of operations presented above are before the elimination of intercompany interest. Financial information for business ventures which are not yet operational or which are no
longer reported since they have been abandoned, are not included in the above summary.

The
following tables represent summary financial information for the Company's operating unconsolidated business ventures being grouped as indicated as of and for the three months ended
December 31, 2001 and 2000 (with the exception of Comstar and BELCEL which are not on a 3-month lag). The results of operations presented below are before the elimination of
intercompany interest (in thousands):

|                                                      |  | Three months ended December 31, 2001 |       
|----------------------------------------------------- |  | ------------------------------------ | ------
|
|Revenues                                              |  | $                                    | 21,093
|Costs and expenses:                                   |  |                                      |       
|Cost of sales and operating expense                   |  |                                      | 10,932
|Selling, general and administrative                   |  |                                      | 5,371 
|Depreciation and amortization                         |  |                                      | 5,612 
|                                                      |  |                                      |       
|Operating income (loss)                               |  |                                      | (822  
|Other income (expense)                                |  |                                      | (179  
|Interest expense                                      |  |                                      | (430  
|                                                      |  |                                      |       
|Net income (loss)                                     |  |                                      | (1,431
|                                                      |  |                                      |       
|Capital expenditures                                  |  |                                      | 1,502 
|Equity in income (losses) of unconsolidated investees |  |                                      | (1,245

12

---

|                                                      |                                     | Three months ended December 31, 2000 |       
|----------------------------------------------------- | ----------------------------------- | ------------------------------------ | ------
|
|Revenues                                              |                                     | $                                    | 22,987
|Costs and expenses:                                   |                                     |                                      |       
|                                                      | Cost of sales and operating expense |                                      |       
|                                                      | Selling, general and administrative |                                      |       
|                                                      | Depreciation and amortization       |                                      |       
|                                                      |                                     |                                      |       
|Operating income (loss)                               |                                     |                                      | (384  
|Other income (expense)                                |                                     |                                      | (927  
|Interest expense                                      |                                     |                                      | (562  
|                                                      |                                     |                                      |       
|Net income (loss)                                     |                                     |                                      | (1,873
|                                                      |                                     |                                      |       
|Capital expenditures                                  |                                     |                                      | 1,430 
|Equity in income (losses) of unconsolidated investees |                                     |                                      | (1,589

5. Long-term Debt

For a description of the terms of the Company's Senior Discount Notes, see Note 6 to the Company's Consolidated Financial Statements included in the
Company's Annual Report on Form 10-K for the year ended December 31, 2001.

Snapper

On November 11, 1998, Snapper entered into a Loan and Security Agreement with the lenders named therein and Fleet Capital Corporation, as agent and as the
initial lender, pursuant to which the lenders agreed to provide Snapper with a $5.0 million term loan facility and a $55.0 million revolving credit facility, the proceeds of which were
used to refinance Snapper's then outstanding obligations under its prior revolving credit agreement and also for working capital purposes. The Snapper loan matures in November 2003 (subject to
automatic one-year renewals unless either party elects to terminate), and is guaranteed by the Company up to $10.0 million (increasing to $15.0 million on the occurrence of
specified events). On January 11, 2001, the Snapper Loan Agreement was amended and the revolving credit facility was increased to $70.0 million. The revolving credit facility decreased
to $66.0 million on March 1, 2001, to $60.0 million on April 1, 2001 and decreased to $55.0 million on July 1, 2001. On February 1, 2002, the Snapper
Loan Agreement was amended and the revolving facility was increased to $65.0 million. The $65.0 million level is in effect from December 1 of each year through March 31 the
following year. Effective April 1 of each year, the revolving credit facility decreases to $60.0 million and remains through June 30 of that year. Then on July 1, the
revolving credit facility decreases to $55.0 million and remains at that level through November 30 of each year.

In
April 2002, the Company determined that it is possible that Snapper will not be in compliance with all its financial covenants during the next four calendar quarters.
Accordingly, the Company has classified, as required under generally accepted accounting principles, all of Snapper's debt to its lenders under the facility in the amount of $53.3 million as a
current liability.

13

---

In
addition, Snapper sells a significant portion of its products through a network of independent dealers that obtain floor plan financing under an arrangement Snapper has entered into
with a financial
institution. The agreement requires that Snapper maintain certain covenants. These covenants include: (i) Snapper must maintain unused availability under its bank line of credit of at least
$3.0 million at the end of each quarter, (ii) Snapper must maintain full compliance with all terms and conditions under its bank line of credit or receive waivers for any
non-compliance, (iii) Snapper must maintain tangible shareholder's equity (as defined in the agreement) of at least $16.0 million on a quarterly basis and (iv) Snapper
must maintain certain financial ratios (as defined in the agreement) to be calculated on an annual basis. If Snapper violates the covenants described in (i) or (iv), Snapper would be required
to provide Textron with a $2.5 million letter of credit, which would remain in place until subsequent quarterly or annual audited financial statements show that Snapper is again in compliance.
If Snapper violates the tangible shareholder's equity covenant described in (iii) above, Snapper would be required to provide Textron with a $3.5 million letter of credit, separate and
distinct from the $2.5 million letter of credit described above. This letter of credit would remain in place until subsequent quarterly or annual audited financial statements show that Snapper
is again in compliance. The Company can give you no assurances that Snapper would be able to obtain those letters of credit on acceptable terms, if at all.

6. Change in Basis of Presentation

As previously disclosed in Note 14 to the Company's financial statements for the year ended December 31, 2001, issues have been raised about the
Company's control of Roscomm Limited, a Guernsey company ("Roscomm") through which the Company owns a 10% stake in Teleport-TP, and about the Company's control of Roscomm's ownership
interest in Teleport-TP. An individual who was a former minority shareholder in Technocom and its subsidiaries at the time of the September 1999 merger of the Company and PLD
Telekom, Inc. (at which time, the Company increased its ownership interest in Technocom to 100%), and who undertook at the time of the merger, in exchange for compensation, to resign from all
positions at Technocom (through which the Company holds part of its interest in Teleport-TP) and its subsidiaries, including Roscomm, retained the position of sole director of Roscomm
following the merger, and continues to retain that position. The individual has recently claimed that, in his capacity as sole director of Roscomm, he pledged Roscomm's 10% interest in
Teleport-TP to a Panamanian company (believed to be related to the individual) as security for payment of certain financial obligations he created between Teleport-TP and the
Panamanian company.

The
Company believes that the individual in question not only has wrongfully occupied the position of sole director of Roscomm Limited in violation of the 1999 agreement, but that the
alleged pledge of Roscomm's 10% interest in Teleport-TP represents self-dealing and is invalid and unenforceable under applicable law. Negotiations with the individual failed
to result in a solution acceptable to the Company. Therefore, in April 2002, the Company caused Technocom to commence an action in the Guernsey courts for an order removing this individual as a
director of Roscomm and for other relief. The court has issued an interim order affirming the Company's position, subject to further review in a full adversarial hearing and, possibly, a full trial on
merits.

The
Company believes that it retains the legal right to control Roscomm (in which it holds an indirect majority interest) and that Roscomm continues to control its 10% stake in
Teleport-TP. However, on April 26, 2002, the Company became aware that certain unauthorized cash disbursements aggregating $0.3 million that benefited the Panamanian company
referred to above occurred at

14

---

Teleport-TP during the last few days of March 2002. The Company has determined that such transactions provide no economic benefit to either Teleport-TP or the Company.
Based on these events, management has concluded that it may not be able to control the day-to-day business affairs of Teleport-TP until these issues are resolved.
Accordingly, effective March 31, 2002, the Company no longer accounts for the results of operations of Teleport-TP on a consolidated basis, but does so using the equity method of
accounting.

Summarized
results of operations of the Company's consolidated financial statements and proforma results of operations of the Company with Teleport-TP unconsolidated as of
all periods presented are as follows (in thousands):

As Presented

Proforma

As Presented

ProformaMarch 31, 2002

March 31, 2001Revenues

$
65,537

$
58,169

$
85,093

$
77,606Cost of sales and operating expenses


32,931


27,343


45,305


40,674Selling, general and administrative


33,206


32,060


34,243


33,169Depreciation and amortization


9,077


8,501


15,758


12,121Operating loss


(9,677
)

(9,735
)

(10,213
)

(8,358
)Equity in income (losses) of unconsolidated investees


510


455


(6,508
)

(8,365
)Minority interest


(757
)

(757
)

(91
)

(91
)Net loss

$
(17,175
)
$
(17,175
)
$
(26,337
)
$
(26,337
)


Summarized
balance sheet information of the Company's consolidated financial statements and proforma balance sheet information of the Company as if Teleport-TP had been
unconsolidated as of December 31, 2001 are as follows (in thousands):

As Presented

ProformaDecember 31, 2001Current assets

$
144,575

$
130,995Investments in and advances to business ventures


104,239


114,910Property, plant and equipment, net


125,885


123,243Goodwill


54,770


54,648Intangible assets, net


36,194


31,661Other assets


4,058


3,918Total assets

$
469,721

$
459,375Current liabilities

$
134,964

$
124,618Total liabilities


347,716


337,370Minority interest


31,229


31,229Total stockholders' equity


90,776


90,776Total liabilities and stockholders' equity

$
469,721

$
459,375


15

---

7. Stockholders' Equity

Preferred Stock

There are 70.0 million shares of preferred stock authorized of 71/4% cumulative convertible preferred stock with a liquidation preference of
$50.00 per share, of which 4.1 million shares were outstanding as of March 31, 2002 and December 31, 2001. Dividends on the preferred stock are cumulative from the date of
issuance and payable quarterly, in arrears. The Company may make any payments due on the preferred stock, including dividend payments and redemptions (i) in cash; (ii) issuance of the
Company's common stock or (iii) through a combination thereof. If the Company were to elect to continue to pay the dividend in cash, the annual cash requirement would be $15.0 million.
Through March 15, 2001, the Company paid its quarterly dividends in cash. The Company elected to not declare a dividend for any quarterly dividend periods ending after June 15, 2001. As
of March 31, 2002, total dividends in arrears are $15.0 million.

8. Earnings Per Share of Common Stock

Basic earnings per share excludes all dilutive securities. It is based upon the weighted average number of common shares outstanding during the period. Diluted
earnings per share reflects the potential dilution that would occur if securities exercisable for or convertible into common stock were exercised or converted into common stock. In calculating diluted
earnings per share, no potential shares of
common stock are to be included in the computation when a loss from continuing operations attributable to common stockholders exists. For the three months ended March 31, 2002 and 2001, the
Company had losses from continuing operations.

At
March 31, 2002 and 2001, the Company had potentially dilutive shares of common stock of 24.8 million.

9. Business Segment Data

The business activities of the Company consist of two operating groups, the Communications Group and Snapper.

The
Communications Group operations provide the following services: (i) fixed telephony; (ii) wireless telephony; (iii) cable television; (iv) radio
broadcasting and (v) China e-commerce and other.

Snapper
manufactures Snapper® brand premium priced power lawnmowers, garden tillers, snow throwers and related parts and accessories.

The
Company evaluates the performance of its operating segments based on earnings before interest, taxes, depreciation, and amortization. The segment information is based on operating
income (loss), which includes depreciation and amortization. Equity in income (losses) of unconsolidated investees reflects elimination of intercompany interest expense.

16

---



9. Business Segment Data (Continued)

The
Company's segment information is set forth as of and for the three months ended March 31, 2002, and 2001 in the following tables (in thousands):

Three months ended March 31, 2002
(in thousands)

|                                                                                  |  | Communications Group |        |   |   |       |   |   |      
|--------------------------------------------------------------------------------- |  | -------------------- | ------ | - | - | ----- | - | - | -----
|
|Consolidated                                                                      |  |                      |        |   |   |       |   |   |      
|Revenues                                                                          |  | $                    | 22,371 |   | $ | 2,488 |   | $ | 3,584
|Cost of sales                                                                     |  |                      | 10,281 |   |   | 756   |   |   | 721  
|                                                                                  |  |                      |        |   |   |       |   |   |      
|Gross margin (1)                                                                  |  |                      | 12,090 |   |   | 1,732 |   |   | 2,863
|Selling, general and administrative                                               |  |                      | 5,759  |   |   | 1,606 |   |   | 2,067
|Depreciation and amortization                                                     |  |                      | 3,521  |   |   | 309   |   |   | 1,014
|                                                                                  |  |                      |        |   |   |       |   |   |      
|Operating income (loss)                                                           |  |                      | 2,810  |   |   | (183  | ) |   | (218 
|Equity in income (losses) of unconsolidated
investees (2)                         |  |                      | (1,245 | ) |   | 2,337 |   |   | (582 
|Foreign currency loss                                                             |  |                      |        |   |   |       |   |   |      
|Minority interest                                                                 |  |                      |        |   |   |       |   |   |      
|Interest expense                                                                  |  |                      |        |   |   |       |   |   |      
|Interest income                                                                   |  |                      |        |   |   |       |   |   |      
|Other income                                                                      |  |                      |        |   |   |       |   |   |      
|Income tax expense                                                                |  |                      |        |   |   |       |   |   |      
|                                                                                  |  |                      |        |   |   |       |   |   |      
|Loss from operations before cumulative effect of a change in accounting principle |  |                      |        |   |   |       |   |   |      
|                                                                                  |  |                      |        |   |   |       |   |   |      
|Capital expenditures                                                              |  |                      |        |   |   |       |   |   |      
|                                                                                  |  |                      |        |   |   |       |   |   |      
|Assets at March 31, 2002                                                          |  |                      |        |   |   |       |   |   |      
|                                                                                  |  |                      |        |   |   |       |   |   |      

---

Note 1:  Gross margin does not include an allocation of network and other depreciation and amortization.

Note 2:  Equity
in income (losses) of unconsolidated investees reflects elimination of intercompany interest expense.

17

---

Three months ended March 31, 2001
(in thousands)

|                                                                                  |  | Communications Group |        |   |   |        |   |   |       
|--------------------------------------------------------------------------------- |  | -------------------- | ------ | - | - | ------ | - | - | ------
|
|Consolidated                                                                      |  |                      |        |   |   |        |   |   |       
|Revenues                                                                          |  | $                    | 21,475 |   | $ | 3,030  |   | $ | 3,318 
|Cost of sales                                                                     |  |                      | 7,986  |   |   | 1,035  |   |   | 1,396 
|                                                                                  |  |                      |        |   |   |        |   |   |       
|Gross margin (1)                                                                  |  |                      | 13,489 |   |   | 1,995  |   |   | 1,922 
|Selling, general and administrative                                               |  |                      | 7,035  |   |   | 1,926  |   |   | 2,086 
|Depreciation and amortization                                                     |  |                      | 4,321  |   |   | 1,194  |   |   | 1,718 
|                                                                                  |  |                      |        |   |   |        |   |   |       
|Operating income (loss)                                                           |  |                      | 2,133  |   |   | (1,125 | ) |   | (1,882
|Equity in income (losses) of unconsolidated
investees (2)                         |  |                      | (1,589 | ) |   | 1,658  |   |   | (5,497
|Foreign currency loss                                                             |  |                      |        |   |   |        |   |   |       
|Minority interest                                                                 |  |                      |        |   |   |        |   |   |       
|Interest expense                                                                  |  |                      |        |   |   |        |   |   |       
|Interest income                                                                   |  |                      |        |   |   |        |   |   |       
|Other income                                                                      |  |                      |        |   |   |        |   |   |       
|Income tax expense                                                                |  |                      |        |   |   |        |   |   |       
|                                                                                  |  |                      |        |   |   |        |   |   |       
|Loss from operations before cumulative effect of a change in accounting principle |  |                      |        |   |   |        |   |   |       
|                                                                                  |  |                      |        |   |   |        |   |   |       
|Capital expenditures                                                              |  |                      |        |   |   |        |   |   |       
|                                                                                  |  |                      |        |   |   |        |   |   |       
|Assets at March 31, 2001                                                          |  |                      |        |   |   |        |   |   |       
|                                                                                  |  |                      |        |   |   |        |   |   |       

18

---

Information about the Communications Group's operations in different geographic locations for the three months ended March 31, 2002 and
2001 and as of March 31, 2002 and December 31, 2001 is as follows (in thousands):

Revenues

AssetsCountry2002

2001

2002

2001CISRussia

$
25,568

$
24,490

$
202,637

$
222,385Kazakhstan


2,488


3,030


14,338


15,581Georgia


611


584


32,553


30,923All other CIS


741


803


12,622


8,200Eastern EuropeRomania


1,601


1,516


10,171


10,289Hungary


1,296


1,123


5,815


5,964All other Eastern Europe


1,353


991


5,002


7,933People's Republic of China





209


1,464


1,549Other


130





1,707


1,708$
33,788

$
32,638

$
286,309

$
305,532


The
Company's investments in and advances to business ventures and goodwill include amounts maintained at the segment and corporate headquarters in the United States. Such amounts are
relative to the Communication Group's operations in different geographic locations.

All
of the Company's remaining assets and substantially all remaining revenue relate to Snapper's operations in the United States.

10. Other Consolidated Condensed Financial Statement Information

Accounts Receivable

The total allowance for doubtful accounts at March 31, 2002 and December 31, 2001 was $3.0 million and $4.6 million, respectively.

19

---

Inventories

Inventories consist of the following as of March 31, 2002 and December 31, 2001 (in thousands):

2002

2001Snapper:Finished goods, net

$
56,658

$
55,344Raw materials


5,801


5,51762,459


60,861Telecommunications:Telephony


2,698


2,636Other


335


2813,034


2,917$
65,492

$
63,778


Interest Expense

Interest expense includes amortization of debt discount of $5.3 million and $4.8 million for the three months ended March 31, 2002 and 2001,
respectively.

11. Commitments and Contingencies

Guarantees and Commitments

The Company and certain of its subsidiaries and business ventures are contingently liable for debts and other obligations to third parties and non wholly-owned
business ventures which they have guaranteed. These contingent liabilities at March 31, 2002 are summarized as follows (in thousands):

Credit line commitments

$
39,900Snapper-Textron floor plan repurchase obligations


31,700Snapper floor plan guarantee


20,400Snapper credit line guarantee


15,000Loan guarantees


8,800Non-cancelable purchase agreements


7,000Capital commitments


5,800Put agreements


1,700$
130,300


The
Company has recorded a liability of $3.4 million for its obligations under the loan guarantees.

Credit Line Commitments.Advances are made to business ventures and subsidiaries in the form of cash,
for working capital purposes, payment of expenses or capital expenditures, or in the form of equipment purchased on behalf of the business ventures. Interest rates charged to the business ventures and
subsidiaries range from prime rate to prime rate plus 6%. The credit agreements generally provide for the payment of principal and interest from 90% of the business ventures' and subsidiaries'
available

20

---

cash flow, as defined, prior to any substantial distributions of dividends to the business venture partners. The Communications Group has entered into credit agreements with its business ventures and
subsidiaries, of which $39.9 million in funding obligations remain at March 31, 2002. The Communications Group's funding commitments are contingent on its approval of the respective
business ventures' and subsidiaries' business plans. The Company's ability to fund these commitments is dependent on the resolution of its liquidity issues (see Note 1).

Snapper-Textron Floor Plan Repurchase Obligations.On August 24, 2001, Snapper signed a
three-year agreement with Textron, whereby Textron will make available floor plan financing to the dealers of Snapper's products. This agreement provides financing for inventories and
accelerates Snapper's cash flow. Under the terms of the agreement, if a dealer defaults in payment, Textron generally can require Snapper to repurchase any new, used or demonstrator equipment
recovered from the dealer, if the inventory cannot be sold to another dealer. In addition to the repurchase obligation, Snapper also has an option whereby it could agree to indemnify Textron for floor
plan financing Textron provides to dealers who do not meet Textron's credit requirements. Snapper's maximum exposure under this voluntary indemnification plan is $4.0 million. As of
March 31, 2002, Snapper had agreed to indemnify $1.2 million under this provision. At March 31, 2002, there was $31.7 million outstanding under this floor plan financing
arrangement. The Company has not guaranteed Snapper's payment obligations under this arrangement.

Snapper Floor Plan Guarantee.Snapper had an agreement with a financial institution, which made
available floor plan financing to dealers of Snapper's products. Under the terms of the agreement, a default in payment by a dealer is nonrecourse to Snapper. However, the third party financial
institution can require Snapper to repurchase new and unused equipment, if the dealer defaults and the inventory is not sold to another dealer. At March 31, 2002 there was approximately
$20.4 million outstanding under this floor plan financing arrangement. The Company has guaranteed Snapper's payment obligations under this arrangement.

Snapper Credit Line Guarantee.The Company has guaranteed Snapper's indebtedness under its primary
credit facility up to $15.0 million. The consolidated financial statements include amounts outstanding under Snapper's facility totaling $53.3 million at March 31, 2002.

Magticom.The Communications Group's Georgian GSM business venture, Magticom, entered into a
financing agreement with Motorola, Inc. pursuant to which Motorola agreed to finance 75% of the equipment, software and service it provides to Magticom up to $25.0 million. Magticom is
obligated to provide Motorola with a security interest in the equipment provided by Motorola to the extent permitted by applicable law. At March 31, 2002, there was $5.4 million
outstanding under this financing agreement. As additional security for the financing, the Company has guaranteed Magticom's repayment obligation to Motorola.

Tyumenruskom.As part of its investment in Tyumenruskom, the Company agreed to provide a guarantee of
payment of $6.1 million to Ericsson Radio Systems, A.B. for equipment financing provided by Ericsson to Tyumenruskom. In 1999, the Company reserved $4.3 million for its contingent
obligations under this guarantee. At March 31, 2002, there was $3.4 million outstanding under this financing arrangement.

21

---

Non-cancelable purchase agreements.Snapper has entered into various manufacturing and
purchase agreements with certain vendors for the purchase of manufactured products and raw materials. As of March 31, 2002, non-cancelable commitments under these agreements
amounted to approximately $7.0 million.

Capital commitments.The Company's majority-owned subsidiary is committed to funding the three
Chinese business ventures to their registered charter capital. Amounts still due under these capital commitments totals $5.8 million at March 31, 2002.

Romsat.In June 2000, the Company's business venture in Romania, Romsat TV, acquired a 70%
ownership interest in FX Internet, an ISP, web hosting and domain registration service in Romania. The remaining shareholders of FX Internet obtained a put option with Romsat TV for their entire
remaining interest. Such put option is exercisable between June 2002 and December 2002 at an amount not to exceed $1.7 million.

Caspian American Telecommunications.The Communication Group owns a 74.1% interest in Omni Metromedia
Caspian, Ltd. ("OMCL"), a company that owns 50% of Caspian American Telecommunications ("CAT") a business venture in Azerbaijan. OMCL has committed to provide up to
$40.5 million in loans to CAT for the funding of equipment acquisition and operational expense subject to concurrence with CAT's business plans. At December 31, 2000,
$23.7 million of the commitment remains available to CAT subject to concurrence with the CAT business plan. The Communications Group was obligated to contribute approximately
$5.0 million in equity to OMCL and to lend up to $36.5 million, subject to the jointly approved business plan. However, in light of CAT's poorer than expected performance in 1999 and
2000, and the limited potential to develop its wireless local loop network without significant sources of financing, the venture has revised its operating plan to stabilize its operations and minimize
future funding requirements. As part of the original transaction, the Communications Group sold participations totaling 19.5% in the $36.5 million loan commitment, which requires the purchasers
to provide the Communications Group 19.5% of the funds to be provided under the loan agreement and entitles them to 19.5% of the repayments to the Communications Group. The Communications Group agreed
to repurchase such loan participations in August 2005 on terms and conditions agreed by the parties. In addition, the Communications Group provided the purchasers the right to put their
ownership interest of 19.5% and in OMCL to the Communications Group starting in February 2001 for a price equal to seven times the EBITDA of CAT minus debt, as defined, multiplied by their
percentage ownership interest.

Arbitration Award to Former Employee

The Company was in arbitration with one former member of the Company's management arising out of the termination of his employment with the Company. The private
arbitration, in which the former employee was seeking damages for breach of his employment agreement in the amount of $1.3 million,
was commenced in February 2001. The Company believes that such former employee was terminated for "cause" while the employee asserted that his termination was without cause and that he is
entitled to the compensation provided for in his employment agreement. In May 2002, the arbitrators issued a decision awarding the former employee $1.5 million in damages (and
pre-judgement interest) and reserved as to whether to award attorneys' fees to the former employee. Such amounts have been accrued as of March 31, 2002. The Company is evaluating
its legal options at this time.

22

---

Contingencies

Risks Associated with the Communications Group's Investments

The ability of the Communications Group and its business ventures and subsidiaries to establish and maintain profitable operations is subject to, among other
things, significant political, economic and social risks inherent in doing business in emerging markets such as Eastern Europe, the CIS and China. These include matters arising out of government
policies, economic conditions, imposition of or changes in government regulations or policies, imposition of or changes to taxes or other similar charges by government bodies, exchange rate
fluctuations and controls, civil disturbances, deprivation or unenforceability of contractual rights, and taking of property without fair compensation.

Litigation

During February 2001, four separate lawsuits were filed by the Company's stockholders against the Company's current and former officers and directors
seeking, among other things, to compel the disposition of Snapper, Inc.

The
Company is involved in various legal and regulatory proceedings including potential liabilities relative to shareholders in RDM Sports Group, Inc. (a former equity investment
of the Company), which filed for relief under Chapter 11 of the Bankruptcy Code in 1997. While the results of any litigation or regulatory issue contain an element of uncertainty, management believes
that the outcome of any known, pending or threatened legal proceedings, including those noted in the preceding paragraph, will not have a material effect on the Company's consolidated financial
position and results of operations.

12. Related Party Transactions

The Company entered into a Consulting Services Agreement with Metromedia Company for the provision by Metromedia Company to the Company of certain consulting
services on an hourly basis as requested by the Company. The services provided by Metromedia Company pursuant to the agreement have been provided as requested by us and have been invoiced to us at
agreed-upon hourly rates. There is no minimum required level of services. We are also obligated to reimburse Metromedia Company for all of its out-of-pocket costs
and expenses incurred and advances paid by Metromedia Company in connection with the agreement.

Prior
to December 31, 2001, the Company paid a fixed management fee to Metromedia Company for certain general and administrative services provided by Metromedia personnel.

Fees
charged by Metromedia Company under these agreements amounted to $0.5 million and $0.9 million for the three months ended March 31, 2002 and 2001, respectively.

23

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Item 2. Management's Discussion and Analysis of Financial Conditions and Results of Operations

Liquidity and Capital Resources

The Company

Overview.The Company is a holding company; accordingly, it does not generate cash flows from
operations. As a result, the Company is dependent on repayments of principal and interest under its credit agreements with its business ventures and subsidiaries and on payment of fees for services
provided by the Company to certain of its business ventures, as well as on the earnings of its subsidiaries and equity investees and the distribution or other payment of these earnings to it to meet
its obligations, including making distributions to its stockholders. The Company's business ventures and subsidiaries are separate legal entities that have no obligation to pay any amounts the Company
owes to third parties. Furthermore, due to legal and contractual restrictions, a substantial portion of the cash balances in certain of the Company's business ventures and subsidiaries, including
Snapper, cannot be readily accessed, if at all, for the Company's liquidity requirements.

As
a result, the Company addresses its liquidity and capital resource requirements on an overall basis and from the following business unit perspective: the Communications Group, China
Operations and Snapper.

Liquidity Issues

As of March 31, 2002 and April 30, 2002, the Company had $7.3 million and $6.1 million, respectively, in cash at its headquarters
level. Based on the Company's current existing cash balances and projected internally generated funds, the Company does not believe that it will be able to fund its operating, investing and financing
cash flows through 2002. In addition, the Company currently projects that its cash flow and existing capital resources will not be sufficient, without external funding or cash proceeds from asset
sales or a combination of both, to pay the September 30, 2002 interest payment on its 101/2% Senior Discount Notes. The principal on the notes (in a fully accreted amount of
$210.6 million) comes due in full on September 30, 2007.

Failure
on the part of the Company to make any required payment of interest or principal on the 101/2% Senior Discount Notes would represent a default under the notes. A
default, if not waived, could result in acceleration of the Company's indebtedness, in which case the full amount of the debt would become immediately due and payable. If this occurs, the Company
would not be able to repay its debt and would likely not be able to borrow sufficient funds to refinance them.

During
2001, Snapper was not in compliance with all of its financial covenants under its primary credit facility. Snapper's indebtedness under that facility is guaranteed by the Company
up to $10.0 million (increasing to $15.0 million on the occurrence of certain events). The lender under that facility on March 20, 2002 waived any event of default arising from
such noncompliance through December 31, 2001 and Snapper was in compliance with all of its financial covenants through March 31, 2002. However, since it is possible that Snapper will not
be in compliance with all of its financial covenants during the next four calendar quarters, the Company has classified, as required under generally accepted accounting principles, all of Snapper's
debt to its lenders under the facility in the amount of $53.3 million as a current liability. The Company may be required to seek amendments to certain financial covenants for future fiscal
periods, and, although it has obtained similar amendments in the past, cannot assure you that any such amendments will be obtained.

Should
Snapper fail to be in compliance with the financial covenants under its primary bank credit facility and not obtain a waiver or amendment to the credit facility, it could impair
our ability to dispose of Snapper, and, if the lenders under that credit facility elect to accelerate repayment of Snapper's indebtedness, could result in a default under the indenture for the Senior
Discount Notes, and could materially and adversely affect our results of operations. In addition, Snapper sells a

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significant portion of its products through a network of independent dealers that obtain floor plan financing under an arrangement Snapper has entered into with a financial institution. If, in the
future Snapper were to not be in compliance with its covenants under its bank line of credit, it would be in default under the independent dealer floor plan financing agreement, which could result in
the program being terminated or curtailed. If the floor plan program is terminated or curtailed, the Company believes that demand for Snapper's products would be curtailed which could have a material
adverse effect on the Company's results of operations unless the dealers could find alternative financing.

The
Company has been exploring possible asset sales to raise additional cash and has been attempting to maximize cash distributions by its ventures to the Company. However, the Company
cannot assure you that it will be successful in selling any of its assets or that any such sales will raise enough cash to be able to relieve its liquidity issues. The Company is also subject to legal
and contractual restrictions, including under the indenture for the Senior Discount Notes, on its use of any cash proceeds of sale of its assets or those of its business ventures or subsidiaries.

Over
the past year, the Company has had periodic discussions with representatives of its noteholders in an attempt to reach agreement on a restructuring of its indebtedness in
conjunction with any proposed asset sales or spinoffs. To date, the noteholders and the Company have not reached any agreement on terms of a restructuring. Discussions between the Company and its
noteholders are continuing, however, and the Company is continuing to examine new restructuring alternatives to present to its noteholders. The Company cannot assure you that these negotiations will
result in a restructuring of its indebtedness.

If
the Company is not able to favorably resolve the liquidity issues described above, the Company would have to resort to certain other measures, including ultimately seeking the
protection afforded under the United States Bankruptcy Code. The Company cannot assure you that it will be successful in meeting its cash requirements or in restructuring its obligations. These
factors raise substantial doubt about our ability to continue as a going concern.

The Communications Group

The Communications Group and many of its business ventures are experiencing continuing losses and negative operating cash flows. The Communications Group's
consolidated and unconsolidated business ventures' ability to meet their respective business plans are dependent upon their ability to attract subscribers to their systems, the sale of commercial
advertising time and their ability to control operating expenses. There can be no assurances that the Communications Group's business will have sufficient resources to achieve their business plans. If
the necessary resources are not available, the growth and continued viability of certain of the Communication Group's business ventures may be impaired.

The
Communications Group has historically been dependent on the Company for significant capital infusions to fund its operations and make acquisitions, as well as to fulfill its
commitments to make capital contributions and loans to its business ventures. Many of the Communications Group's business ventures operate or invest in business operations, such as cable television,
fixed telephony and cellular telecommunications, that require significant capital investment in order to construct, develop and maintain operational systems and market their services. The
Communications Group's business ventures capital expenditure programs anticipate aggregate cash outlays of $47.6 million throughout the rest of 2002 in order to meet their respective business
plans.

Until
the Communications Group's operations generate sufficient positive cash flow, the Communications Group will require capital to fund its operations. The Company believes that if
more of the Communications Group's business ventures reduce their dependence on the Company for funding, the Communications Group may be able to finance its own operations and commitments from

25

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its operating cash flow and may be able to attract its own financing from third parties. There can be no assurance, however, that more of the Communications Group business ventures will become less
dependent on the Company, or that additional capital in the form of debt or equity will be available to the Communications Group at all or on terms and conditions that are acceptable to the
Communications Group or the Company, and as a result, the Communications Group's business ventures may continue to depend upon the Company for its financing needs. The Company will not be able to
satisfy those needs unless it resolves its liquidity issues favorably, and even if it does so, may not be able to meet the business venture's financing needs, and, in that event, the business
venture's growth and/or continued viability will be substantially impaired.

Credit
agreements between certain of the business ventures and the Communications Group are intended to provide such business ventures with sufficient funds for operations and equipment
purchases. The credit agreements generally provide for interest to accrue at rates ranging from the prime rate to the prime rate plus 6% and for payment of principal and interest from 90% of the
business venture's available cash flow, as defined, prior to any distributions of dividends to the Communications Group or its business venture partners. The credit agreements also often provide the
Communications Group the contractual right to appoint the general director of the business venture and the right to approve the annual business plan of the business. Advances under the credit
agreements are made to the business ventures in the form of cash for working capital purposes, as direct payment of expenses or expenditures, or in the form of equipment, at the cost of the equipment
plus cost of shipping.

China e-commerce.The Company has funded its majority-owned subsidiary Metromedia China ("MCC") under a credit agreement, and
MCC has used the proceeds of these loans principally to fund its investments in business ventures in China. At March 31, 2002, MCC owed $16.4 million to the Company under this credit
agreement (including accrued interest). MCC currently operates three Chinese application service provider business units (Huaxia, Clarity and MHIS). MCC formerly operated an information content and
web services business (Twin Poplars/66cities.com Co., Ltd.) and several telecommunications business ventures in China.

The
Company is exploring other means to finance these business operations, which may include the raising of capital from current shareholders of MCC or other private investors, or the
sale of the operations. However, the Company can make no assurances that alternative sources of funding will be obtained for these business operations.

As
of March 31, 2002, the Communications Group had unfunded commitments to provide funding under various charter fund agreements and credit lines in an aggregate amount of
approximately $45.7 million. The Communications Group's funding commitments under a credit agreement are
contingent upon its approval of the business venture's business plan. To the extent that the Communications Group does not approve a business venture's business plan, the Communications Group is not
required to provide funds to that business venture under the credit line.

The
Communications Group's ability to meet its operational funding requirements and anticipated capital expenditures programs are dependent upon the availability of
self-generated cash flows, as well as funding from the Company.

Former PLD Businesses.The business ventures acquired through the acquisition of PLD Telekom have been able to pay for
capital expenditures and operating expenses with internally generated cash flows from operations and/or have been able to arrange their own financing, including supplier financing. In no case is the
Company or MITI specifically obligated to provide capital to these business ventures.

26

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Snapper

Historically, Snapper's liquidity is generated from its cash flows from operations and borrowings. The Company believes that Snapper's available cash on hand,
cash flow generated by operating activities, borrowings from the Snapper loan agreement and floor plan financing and, on an as needed basis, short-term working capital funding from the
Company (recognizing that there exists the possibility that the Company may not have the liquidity to provide such funding), will provide sufficient funds for Snapper to meet its obligations and
capital requirements.

A
large percentage of the residential and commercial sales of lawn and garden equipment are made during a 17-week period from early spring to mid-summer. Although
some sales are made to the dealers, distributors and Wal-Mart prior and subsequent to this period, the largest volume of sales is made during this time. The majority of revenues during the
late fall and winter periods are related to snow thrower shipments. Sales are also influenced significantly by weather conditions that influence certain purchasers of lawn and garden equipment.
Specifically, drier weather tends to negatively impact sales of Snapper products.

Snapper
entered into a loan and security agreement with the lenders named therein and Fleet Capital Corporation, as agent and as the initial lender, pursuant to which the lenders agreed
to provide Snapper with a $5.0 million term loan facility and up to a $65.0 million revolving credit facility, the proceeds of which were used to refinance Snapper's then outstanding
obligations under its prior revolving credit agreement and will also be used for working capital purposes. The Snapper loan will mature in November 2003 (subject to automatic one-year
renewals), and is guaranteed by the Company, up to $10.0 million (increasing to $15.0 million on the occurrence of specified events).

Since
it is possible that Snapper will not be in compliance with all of its financial covenants during the next four calendar quarters, the Company has classified, as required under
generally accepted accounting principles, all of Snapper's debt to its lenders under the facility in the amount of $53.3 million as a current liability. The Company may be required to seek
amendments to certain financial covenants for future fiscal periods, and, although it has obtained similar amendments in the past, cannot assure you that any such amendments will be obtained.

If,
in the future, Snapper were to not be in compliance with its covenants under its bank line of credit, it would be in default under its floor plan financing agreement, which could
result in the program being terminated or curtailed. If the floor plan program is terminated or curtailed, the Company believes that demand for Snapper's products would be curtailed which could have a
material adverse effect on the Company's results of operations unless the dealers could find alternative financing. The agreements governing the initial and amended Loan and Security Agreement contain
standard representations and warranties, covenants, conditions precedent and events of default, and provide for the grant of a security interest in substantially all of Snapper's assets other than
real property. At March 31, 2002, Snapper's outstanding liability for its term loans and line of credit was $53.3 million.

Senior Discount Notes

In connection with the acquisition of PLD Telekom, the Company issued $210.6 million in aggregate principal amount at maturity of its 101/2%
Senior Discount Notes due 2007 (the "Senior Discount Notes") in exchange for PLD Telekom's then outstanding senior discount notes and convertible subordinated notes. The Senior Discount Notes did not
accrue cash interest before March 30, 2002. As of April 1, 2002, holders of the Senior Discount Notes are due interest at the rate of 101/2% per year, payable
semi-annually in cash. The Company is attempting to restructure its obligations relating to the Senior Discount Notes. The Senior Discount Notes are general senior unsecured obligations of the
Company, rank senior in right of payment to all existing and future subordinated indebtedness of the Company, rank equal in right of payment to all existing and future

27

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senior indebtedness of the Company and will be effectively subordinated to all existing and future secured indebtedness of the Company to the extent of the assets securing such indebtedness and to
all existing and future indebtedness of the Company's subsidiaries, whether or not secured.

The
Senior Discount Notes are redeemable at the sole option of the Company only at a redemption price equal to their principal amount plus accrued and unpaid interest, if any, up to but
excluding the date of redemption. Upon the occurrence of a change of control of the Company (as such term is defined in the indenture for the Senior Discount Notes (the "Indenture")), the holders of
the Senior Discount Notes will be entitled to require the Company to repurchase such holders' notes at a purchase price equal to 101% of the principal amount of such notes plus accrued and unpaid
interest to the date of repurchase. The Indenture for the Senior Discount Notes limits the ability of the Company and certain of its subsidiaries to, among other things, incur additional indebtedness
or issue capital stock or preferred stock, pay dividends on, and repurchase or redeem their capital stock or
subordinated obligations, invest in and sell assets and subsidiary stock, engage in transactions with affiliates and incur additional liens. The Indenture for the Senior Discount Notes also limits the
ability of the Company to engage in consolidations, mergers and transfers of substantially all of its assets and also contains limitations on restrictions on distributions from its subsidiaries.

Convertible Preferred Stock

The Company completed a public offering of 4,140,000 shares of $1.00 par value, 71/4% cumulative convertible preferred stock in 1997, generating
net proceeds of approximately $199.4 million. Dividends on the preferred stock are cumulative from the date of issuance and payable quarterly, in arrears. The Company may make any payments due
on the preferred stock, including dividend payments and redemptions (i) in cash; (ii) through issuance of the Company's common stock or (iii) through a combination thereof. If the
Company were to elect to continue to pay the dividend in cash, the annual cash requirement would be $15.0 million. Through March 15, 2001, the Company paid its quarterly dividends on the
preferred stock in cash. The Company has not declared a dividend for any quarterly dividend period ending after June 15, 2001. As of March 31, 2002, total dividends in arrears were
$15.0 million. If the Company does not pay the dividend on the preferred stock for six consecutive quarters (after the quarterly dividend period ended September 15, 2002 if no dividends
are paid for any earlier quarterly dividend periods in 2002), holders of the preferred stock would have the right to call a stockholders meeting and to elect two new directors to the Company's Board
of Directors.

Corporate Overhead Costs

In 2001 and 2000, the Company's corporate overhead costs were $36.0 million, and $44.5 million, respectively. The principal components of the
Company's corporate overhead costs relate to personnel costs (salaries and wages, other employee benefits and travel related costs), professional fees (lawyers, accountants and bankers), consultants,
facility related costs and other general and administrative costs associated (insurance and regulatory compliance costs).

The
Company currently anticipates that its 2002 corporate overhead costs will range from approximately $25.0 million to $30.0 million, depending upon the Company's ability
to execute its current strategy to reduce its expenditures. As of March 31, 2002, the Company's year-to-date corporate overhead costs were $9.2 million, of which
$5.1 million was paid in cash during the quarter. An estimate of such corporate overhead costs of $8.4 million was included in the Company's annual report as filed on
Form 10-K. Subsequent to filing the Form 10-K, management determined that certain additional accruals were required to present the financial results of operations
for the quarter ended March 31, 2002 in accordance with accounting principles generally accepted in the United States. However, management continues to believe that its estimate for 2002
corporate overhead costs will fall within the range discussed above.

28

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Although
the Company has been working to reduce its overhead costs, the Company believes that there is a limit as to which it can reduce its corporate cost structure to without losing
its ability to provide the appropriate level of management oversight.

Guarantees and Commitments

The Company and certain of its subsidiaries and business ventures are contingently liable for debts and other obligations to third parties and non wholly-owned
business ventures which they have guaranteed. These contingent liabilities at March 31, 2002 are summarized as follows (in thousands):

Credit line commitments

$
39,900Snapper-Textron floor plan repurchase obligations


31,700Snapper floor plan guarnatee


20,400Snapper credit line guarantee


15,000Loan guarantees


8,800Capital commitments


5,800Put agreements


1,700$
130,300


For
further information regarding the nature of these contingent liabilities, see Note 11 to the Company's unaudited consolidated condensed financial statements contained herein.

Arbitration Award to Former Employee

The Company was in arbitration with one former member of the Company's management arising out of the termination of his employment with the Company. The private
arbitration, in which the former
employee was seeking damages for breach of his employment agreement in the amount of $1.3 million, was commenced in February 2001. The Company believes that such former employee was
terminated for "cause" while the employee asserted that his termination was without cause and that he is entitled to the compensation provided for in his employment agreement. In May 2002, the
arbitrators issued a decision awarding the former employee $1.5 million in damages (and pre-judgement interest) and reserved as to whether to award attorneys' fees to the former
employee. Such amounts have been accrued as of March 31, 2002. The Company is evaluating its legal options at this time.

Discussion of Changes in Financial Position

Three Months Ended March 31, 2002 Compared to Three Months Ended March 31, 2001

Cash Flows from Operating Activities

Cash used in operating activities for the quarter ended March 31, 2002 was $8.1 million, a decrease in cash used in operating activities of
$7.5 million from the same period in the prior year. Non-cash items decreased in the quarter ended March 31, 2002 compared to the quarter ended March 31, 2001, principally as a
result of a reduction in depreciation and amortization expense of $6.7 million. This was principally due to the adoption of SFAS No. 142. We anticipate that depreciation and amortization
will be consistent for the remainder of fiscal year 2002. In addition, the Company recorded a non-cash charge of $2.4 million in the quarter ended March 31, 2001, due to the adoption of
EITF No. 01-9.

Changes
in operating assets and liabilities for the quarter ended March 31, 2002 resulted in cash outflows of $5.5 million, principally as a result of an increase of
$7.4 million in accounts receivable and a $1.7 million increase in inventories offset by a reduction of $2.7 million of accounts payable and accrued expenses. Changes in operating
assets and liabilities for the quarter ended March 31, 2001

29

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resulted in cash outflows of $18.7 million, principally as a result of an increase of $17.7 million in accounts receivable, a $2.1 million increase in inventories and an increase
of $1.7 million of accounts payable and accrued expenses.

Cash Flows from Investing Activities

Cash used in investing activities for the quarter ended March 31, 2002 amounted to $2.9 million as compared to $7.6 million cash used in
investing activities for the quarter ended March 31, 2001. This change is principally due to the reductions in purchases of property, plant and equipment during the current year. In addition,
the Company purchased an additional equity interest in one of its subsidiaries in the first quarter of 2001, which resulted in cash outflows of $2.1 million.

Cash Flows from Financing Activities

Cash provided by financing activities was $6.9 million for the quarter ended March 31, 2002 as compared to $8.8 million for the same period
in the prior year. The reduction in use of cash in 2002 was due to a $3.8 million reduction in the preferred dividends paid and a reduction of $2.2 million for debt repayments. In the
first quarter of 2002, the Company borrowed an additional $7.6 million (principally draws on the Snapper credit line) while additional borrowings in the first quarter of 2001 were
$15.3 million.

Results of Operations

The business activities of the Company consist of two operating groups, the Communications Group and Snapper.

Communications Group

Overview

The Communications Group has operations in Eastern Europe and the Commonwealth of Independent States ("CIS") and e-commerce related businesses in
China. The Communications Group provides the following services: (i) fixed telephony; (ii) wireless telephony; (iii) cable television; (iv) radio broadcasting and
(v) China e-commerce and other.

The
Company continues to focus its growth strategy on opportunities in communications businesses. The constantly changing technologies involved in the Communications Group's telephony
and cable
businesses, and the relationship of each business to Internet access has provided the Company with new opportunities.

The
Communications Group's consolidated revenues represented 52% and 39% of the Company's total revenues for the three months ended March 31, 2002 and 2001, respectively.

Snapper

Snapper manufactures Snapper® brand premium-priced power lawnmowers, garden tillers, snowthrowers, utility vehicles and related parts and accessories.
The lawnmowers include rear engine riding mowers, front-engine riding mowers or lawn tractors, and self-propelled and push-type walk-behind mowers. Snapper also
manufactures a line of commercial lawn and turf equipment under the Snapper brand.

Snapper
provides lawn and garden products through distribution channels to domestic and foreign retail markets.

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Segment Information

The
following tables set forth operating results for the three months ended March 31, 2002 and 2001, for the Company's Communications Group and Snapper.

Segment Information
Three months ended March 31, 2002
(in thousands)

|                                                          |  | Communications Group |        |   |   |        |   |   |       
|--------------------------------------------------------- |  | -------------------- | ------ | - | - | ------ | - | - | ------
|
|Consolidated                                              |  |                      |        |   |   |        |   |   |       
|Revenues                                                  |  | $                    | 22,371 |   | $ | 2,488  |   | $ | 3,584 
|Cost of sales                                             |  |                      | 10,281 |   |   | 756    |   |   | 721   
|                                                          |  |                      |        |   |   |        |   |   |       
|Gross margin (1)                                          |  |                      | 12,090 |   |   | 1,732  |   |   | 2,863 
|Selling, general and administrative                       |  |                      | 5,759  |   |   | 1,606  |   |   | 2,067 
|Depreciation and amortization                             |  |                      | 3,521  |   |   | 309    |   |   | 1,014 
|                                                          |  |                      |        |   |   |        |   |   |       
|Operating income (loss)                                   |  |                      | 2,810  |   |   | (183   | ) |   | (218  
|                                                          |  |                      |        |   |   |        |   |   |       
|Unconsolidated Business Ventures                          |  |                      |        |   |   |        |   |   |       
|Revenues                                                  |  | $                    | 21,093 |   | $ | 13,202 |   | $ | 6,363 
|Cost of sales                                             |  |                      | 10,932 |   |   | 1,927  |   |   | 1,327 
|                                                          |  |                      |        |   |   |        |   |   |       
|Gross margin                                              |  |                      | 10,161 |   |   | 11,275 |   |   | 5,036 
|Selling, general and administrative                       |  |                      | 5,371  |   |   | 2,406  |   |   | 3,301 
|Depreciation and amortization                             |  |                      | 5,612  |   |   | 3,749  |   |   | 1,880 
|                                                          |  |                      |        |   |   |        |   |   |       
|Operating income (loss)                                   |  |                      | (822   | ) |   | 5,120  |   |   | (145  
|Net income (loss)                                         |  |                      | (1,431 | ) |   | 5,032  |   |   | (1,467
|Equity in income (losses) of unconsolidated investees (2) |  |                      | (1,245 | ) |   | 2,337  |   |   | (582  
|Foreign currency loss                                     |  |                      |        |   |   |        |   |   |       
|Minority interest                                         |  |                      |        |   |   |        |   |   |       
|Interest expense                                          |  |                      |        |   |   |        |   |   |       
|Interest income                                           |  |                      |        |   |   |        |   |   |       
|Other income                                              |  |                      |        |   |   |        |   |   |       
|Income tax expense                                        |  |                      |        |   |   |        |   |   |       
|                                                          |  |                      |        |   |   |        |   |   |       
|Net loss                                                  |  |                      |        |   |   |        |   |   |       
|                                                          |  |                      |        |   |   |        |   |   |       

---

Note 1:  Gross margin does not include an allocation of network and other depreciation and amortization.

Note 2:  Equity
in income (losses) of unconsolidated investees reflects elimination of intercompany interest expense.

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Segment Information
Three months ended March 31, 2001
(in thousands)

|                                                          |  | Communications Group |        |   |   |        |   |   |       
|--------------------------------------------------------- |  | -------------------- | ------ | - | - | ------ | - | - | ------
|
|Consolidated                                              |  |                      |        |   |   |        |   |   |       
|Revenues                                                  |  | $                    | 21,475 |   | $ | 3,030  |   | $ | 3,318 
|Cost of sales                                             |  |                      | 7,986  |   |   | 1,035  |   |   | 1,396 
|                                                          |  |                      |        |   |   |        |   |   |       
|Gross margin (1)                                          |  |                      | 13,489 |   |   | 1,995  |   |   | 1,922 
|Selling, general and administrative                       |  |                      | 7,035  |   |   | 1,926  |   |   | 2,086 
|Depreciation and amortization                             |  |                      | 4,321  |   |   | 1,194  |   |   | 1,718 
|                                                          |  |                      |        |   |   |        |   |   |       
|Operating income (loss)                                   |  |                      | 2,133  |   |   | (1,125 | ) |   | (1,882
|                                                          |  |                      |        |   |   |        |   |   |       
|Unconsolidated Business Ventures                          |  |                      |        |   |   |        |   |   |       
|Revenues                                                  |  | $                    | 22,987 |   | $ | 11,376 |   | $ | 6,525 
|Cost of sales                                             |  |                      | 11,837 |   |   | 2,130  |   |   | 2,420 
|                                                          |  |                      |        |   |   |        |   |   |       
|Gross margin                                              |  |                      | 11,150 |   |   | 9,246  |   |   | 4,105 
|Selling, general and administrative                       |  |                      | 5,704  |   |   | 2,909  |   |   | 5,471 
|Depreciation and amortization                             |  |                      | 5,830  |   |   | 2,937  |   |   | 2,972 
|                                                          |  |                      |        |   |   |        |   |   |       
|Operating income (loss)                                   |  |                      | (384   | ) |   | 3,400  |   |   | (4,338
|Net income (loss)                                         |  |                      | (1,873 | ) |   | 2,678  |   |   | (6,665
|Equity in income (losses) of unconsolidated investees (2) |  |                      | (1,589 | ) |   | 1,658  |   |   | (5,497
|Foreign currency loss                                     |  |                      |        |   |   |        |   |   |       
|Minority interest                                         |  |                      |        |   |   |        |   |   |       
|Interest expense                                          |  |                      |        |   |   |        |   |   |       
|Interest income                                           |  |                      |        |   |   |        |   |   |       
|Other income                                              |  |                      |        |   |   |        |   |   |       
|Income tax expense                                        |  |                      |        |   |   |        |   |   |       
|Cumulative effect of a change in accounting principle     |  |                      |        |   |   |        |   |   |       
|                                                          |  |                      |        |   |   |        |   |   |       
|Net loss                                                  |  |                      |        |   |   |        |   |   |       
|                                                          |  |                      |        |   |   |        |   |   |       

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Results of OperationsThree Months Ended March 31, 2002 Compared to Three Months Ended March 31, 2001

CONSOLIDATED RESULTS OF OPERATIONS FOR THE QUARTER ENDED MARCH 31, 2002 COMPARED TO THE CONSOLIDATED RESULTS OF OPERATIONS FOR THE QUARTER ENDED MARCH 31, 2001

COMMUNICATIONS GROUP

Fixed Telephony

Revenues.Fixed telephony revenues increased by $0.9 million to $22.4 million for the quarter ended
March 31, 2002 as compared to $21.5 million for the quarter ended March 31, 2001. This increase was primarily attributable to PeterStar and BCL.

Revenues
at PeterStar increased by $0.7 million to $12.6 million for the quarter ended March 31, 2002 as compared to $11.9 million for the quarter ended
March 31, 2001. This increase in revenues is due to growth in underlying business and residential services revenue. Revenues at Baltic Communications Ltd. ("BCL") increased by
$0.3 million to $1.9 million for the quarter ended March 31, 2002 as compared to $1.6 million for the quarter ended March 31, 2001. Revenues at Technocom remained
flat at $7.6 million. Substantially all of the revenues in Technocom are attributable to its subsidiary, Teleport-TP. Teleport-TP revenues will not be included in the
Company's consolidated revenues subsequent to March 31, 2002, as the Company will no longer consolidate the results of Teleport-TP. Until certain
control issues are resolved, the results of Teleport-TP will be included in the results of operations of equity investees.

Gross margin.Fixed telephony gross margin decreased by $1.4 million to $12.1 million for the quarter ended
March 31, 2002 as compared to $13.5 million for the quarter ended March 31, 2001. This decrease is principally due to a decrease in gross margin at Technocom and PeterStar.

Gross
margin at Technocom decreased by $1.2 million to $1.9 million for the quarter ended March 31, 2002 as compared to $3.1 million for the quarter ended
March 31, 2001. This decrease was due principally to the decrease in margins associated with long distance traffic settlement. Gross margin at PeterStar decreased by $0.5 million. This
decrease, despite an increase in revenues, is due to a higher percentage of lower margin business. BCL experienced growth in revenues of $0.3 million without a significant increase in costs.

Selling, general and administrative.Fixed telephony selling, general and administrative expenses decreased by
$1.2 million to $5.8 million for the quarter ended March 31, 2002 as compared to $7.0 million for the quarter ended March 31, 2001. This decrease was principally the
result of decreases at PeterStar of $0.8 million, due to management fees and staff reductions.

Depreciation and amortization.Fixed telephony depreciation and amortization expense decreased by $0.8 million to
$3.5 million for the quarter ended March 31, 2002 as compared to $4.3 million for the quarter ended March 31, 2001. This decrease is principally related to the reduced
depreciation of $1.2 million at Teleport-TP due to the impairment of certain fixed assets recorded in the fourth quarter of the year ended December 31, 2001 partially offset
by depreciation of fixed assets placed in service at Teleport-TP and PeterStar during 2001.

Operating income.Fixed telephony operating income increased by $0.7 million to $2.8 million for the quarter
ended March 31, 2002 as compared to $2.1 million for the quarter ended March 31, 2001. This increase was due to the changes discussed above.

Wireless Telephony

Revenues.Wireless telephony revenues decreased by $0.5 million to $2.5 million for the quarter ended
March 31, 2002 as compared to $3.0 million for the quarter ended March 31, 2001. This

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decrease in revenues is due to increased competition at ALTEL from two GSM competitors. While the subscriber base at ALTEL is increasing, the increases are primarily from lower usage prepaid
subscribers.

Gross margin.Wireless telephony gross margin decreased $0.3 million to $1.7 million for the quarter ended
March 31, 2002 as compared to $2.0 million for the quarter ended March 31, 2001. This decrease is due principally to the reduction in ALTEL revenues partially offset by an
improvement in gross margin percentage.

Selling, general and administrative.Wireless telephony selling, general and administrative expenses decreased by
$0.3 million to $1.6 million for the quarter ended March 31, 2002 as compared to $1.9 million for the quarter ended March 31, 2001. This decrease is principally
related to management efforts to contain costs in line with the reductions in revenue.

Depreciation and amortization.Wireless telephony depreciation and amortization expense decreased by $0.9 million to
$0.3 million for the quarter ended March 31, 2002 as compared to $1.2 million for the quarter ended March 31, 2001. This decrease is due to the reduced depreciation of
$0.8 million at ALTEL due to the impairment of certain fixed assets recorded in the fourth quarter of the year ended December 31, 2001.

Operating loss.Wireless telephony operating loss decreased by $0.9 million to $0.2 million for the quarter
ended March 31, 2002 as compared to $1.1 million for the quarter ended March 31, 2001. This decrease is principally due to the reduction in depreciation and amortization and the
reduced revenues offset by savings in selling, general and administrative expenses.

Cable Television

Revenues.Cable television revenues increased by $0.3 million to $3.6 million for the quarter ended
March 31, 2002 as compared to $3.3 million for the quarter ended March 31, 2001. This increase in revenues is due principally to an increase in revenues of $0.1 million at
both Arkhangelsk and Romsat TV.

Revenues
at Arkhangelsk increased primarily due to increases in subscriber numbers and rates derived from the upgrade of a portion of the cable television network. Revenues at Romsat TV
increased principally due to rate increases.

Gross margin.Cable television gross margin increased by $1.0 million to $2.9 million for the quarter ended
March 31, 2002 as compared to $1.9 million for the quarter ended March 31, 2001. This increase is due principally to increases in gross margin at Romsat TV, Ayety-TV
and Arkhangelsk.

Gross
margin at Romsat TV and Ayety-TV increased by $0.2 million and $0.1 million, respectively, primarily due to decreases in the cost of sales as a result of
certain accruals recorded in 2001. Gross margin at Arkhangelsk increased by $0.1 due to the increases in revenues, without a corresponding increase in costs.

Selling, general and administrative.Cable television selling, general and administrative expenses remained flat at
$2.1 million for March 31, 2002 and 2001.

Depreciation and amortization.Cable television depreciation and amortization expense decreased by $0.7 million to
$1.0 million for the quarter ended March 31, 2002 as compared to $1.7 million for the quarter ended March 31, 2001. Such decrease is due to certain fixed assets at Romsat
TV and Ayety-TV becoming fully depreciated.

Operating loss.Cable television operating loss decreased by $1.7 million to $0.2 million for the quarter ended
March 31, 2002 as compared to $1.9 million for the quarter ended March 31, 2001. This decrease is due principally to improvements in operating results at Romsat TV,
Ayety-TV and Sun TV.

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Operating
results at Romsat TV improved from a loss of $0.3 million for the quarter ended March 31, 2001 to an operating income of $0.2 million for the quarter ended
March 31, 2002. This is due principally to increases in gross margin and reductions in depreciation and amortization and operating expenses. Operating losses at Ayety-TV decreased
by $0.2 million to $0.2 million for the quarter ended March 31, 2002 principally due to a reduction in depreciation and amortization expenses. Operating results at Sun TV improved
from break even for the quarter ended March 31, 2001 to an operating income of $0.1 million for the quarter ended March 31, 2002. This increase is due principally to an
improvement in margins despite flat revenues.

Radio Broadcasting

Revenues.Radio broadcasting revenues increased by $0.8 million to $5.3 million for the quarter ended
March 31, 2002 as compared to $4.5 million for the quarter ended March 31, 2001. This increase in revenues is due principally to increases in revenue at Trio and Juventus.

Revenues
at Trio increased by $0.4 million for the quarter ended March 31, 2002 due to the consolidation of Trio Radio's results from September 2001. Revenues at
Juventus increased by $0.2 million to $1.3 million for the quarter ended March 31, 2002 as compared to $1.1 million for the quarter ended March 31, 2002.

Selling, general and administrative.Radio selling, general and administrative expenses increased by $1.5 million to
$4.6 million for the quarter ended March 31, 2002 as compared to $3.1 million for the quarter ended March 31, 2001. This increase is principally due to increases at
Juventus and Oy Metromedia Finland Ab.

Selling,
general and administrative at Juventus increased by $0.6 million to $1.6 million for the quarter ended March 31, 2002 as compared to $1.0 million for
the quarter ended March 31, 2001. This increase is due to increases in license fees combined with increases in operating expenses associated with the acquisitions completed during 2001.
Selling, general and administrative at P4 Finnn Radio increased by $0.6 million to $0.6 million for the quarter ended March 31, 2002 as compared to $0.0 million for the
quarter ended March 31, 2001. This increase is due to the acquisition of Oy Metromedia Finland Ab during the year 2001 and as such the results of Oy Metromedia Finland Ab were not included in
the quarter ended March 31, 2001.

Depreciation and amortization.Radio depreciation and amortization expense decreased by $0.1 million to
$0.4 million for the quarter ended March 31, 2002 as compared to $0.5 million for the quarter ended March 31, 2001.

Operating income.Radio operating income decreased by $0.5 million to $0.3 million for the quarter ended
March 31, 2002 as compared to $0.8 million for the quarter ended March 31, 2001. This increase is due to Juventus and Oy Metromedia Finland Ab.

Operating
loss at Juventus increased by $0.4 million to $0.5 million for the quarter ended March 31, 2002 as compared to $0.1 million for the quarter ended
March 31, 2001. This increase in operating loss is due principally to the increase in selling, general and administrative expenses. Operating loss at Oy Metromedia Finland Ab increased by
$0.6 million to an operating loss of $0.6 million for the quarter ended March 31, 2002 as compare to nil operating income for the quarter ended March 31, 2001. This
increase in operating loss is due to the results of Oy Metromedia Finland Ab being consolidated from the second quarter 2001 and was therefore not included in the results of operations for the quarter
ended March 31, 2001.

China e-commerce and Others

Revenues.China e-commerce operations revenues decreased by $0.3 million to nil for the quarter ended
March 31, 2002 as compared to $0.3 million for the quarter ended March 31, 2001. Such reduction is a result of the Company disposing of its 66 cities business in the fourth
quarter of 2001.

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Gross Margin.China e-commerce operations gross margin decreased $0.1 million to nil for the quarter ended
March 31, 2002 as compared to the quarter ended March 31, 2001.

Selling, general and administrative.China e-commerce operations selling, general and administrative expenses
decreased by $0.8 million to $1.2 million for the quarter ended March 31, 2002 as compared to $2.0 million for the quarter ended March 31, 2001.

Depreciation and amortization.China e-commerce operations depreciation and amortization expense decreased
$0.2 million to $0.1 million for the quarter ended March 31, 2002 as compared to $0.3 million for the quarter ended March 31, 2001.

Operating loss.The operating loss decreased by $0.9 million to $1.3 million for the quarter ended
March 31, 2002 as compared to $2.2 million for the quarter ended March 31, 2001.

SNAPPER

Revenues.Snapper's 2002 first quarter sales were $31.5 million as compared to $51.9 million in 2001. Sales of
lawn and garden equipment contributed the majority of the revenues during both periods. The decrease in revenues for the first quarter of 2002 compared to the same period for 2001 is primarily due to
$14.2 million in additional sales to Wal-Mart during 2001, which represented the products for the roll-out of the Wal-Mart distribution channel. Parts and
accessories sales were $2.0 million lower during the first quarter of 2002 compared to the same period in 2001 reflecting dealer caution and a weak economy. Snow thrower sales and utility
vehicle sales were both $1.4 million lower during 2002
reflecting unfavorable weather conditions and new product roll-out in the first quarter of 2001, respectively.

Gross margin.Gross margin in 2002 was $10.2 million versus $17.8 million in 2001. The lower gross margin in
2002 was due to lower sales noted above. In addition, gross margins in 2002 decreased from 34% in 2001 to 32% in 2002 due to reduced plant production in order to continue reducing inventory levels in
the field and at the plant.

Selling, general and administrative.Selling, general and administrative expenses were $8.8 million in 2002 as
compared to $11.8 million in 2001. 2002 expenses were lower primarily due to $0.6 million lower distribution costs based on lower sales volume, $0.6 million lower commissions paid
to distributors and agents due to reduced sales and due to two less distributors in 2002 as compared to 2001, $0.4 million lower bonus accruals due to lower sales and operating profit than 2001
and $0.2 million reductions in advertising costs for Wal-Mart due to initial start-up costs incurred in 2001. The remaining reduction of $1.2 million in 2002
expenses were due to across the board expense control measures in place to offset sales shortfalls.

Operating income.Operating income was $0.3 million in 2002 as compared to $4.6 million in 2001. 2002 operating
income decreases were due to lower sales and lower gross margins as noted above.

OTHER CONSOLIDATED RESULTS

Other consolidated results include the activities of the segment headquarters, which relate to executive, administrative, logistical and joint venture support
activities including corporate headquarters costs.

Selling, general and administrative.Selling, general and administrative expenses at the corporate level increased from
$6.3 million in the quarter ended March 31, 2001 to $9.2 million for the quarter ended March 31, 2002. This is principally due to an increase in accruals for current
litigation, estimated arbitration settlement with a former employee and legal and accounting costs incurred during the first quarter of 2002. Such increases were offset by the reduction in the
Company's management fee with Metromedia Company.

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Depreciation and amortization.Depreciation and amortization at the corporate level decreased from $6.4 million in the
quarter ended March 31, 2001 to $2.7 million for the quarter ended March 31, 2002. This principally related to the adoption of SFAS No. 142, which resulted in a reduction
of amortization of goodwill recorded at the corporate level.

Interest expense.Interest expense for the quarter ended March 31, 2002 decreased by $0.3 million to
$5.9 million for the quarter ended March 31, 2001 as compared to $6.2 million for the quarter ended March 31, 2001. The decrease in interest was principally due to lower
interest rates and lower loan balances on Snapper's debt, partially offset by higher amortization of discount on the Senior Discount Notes.

Interest income.Interest income decreased by $1.2 million to $0.4 million for the quarter ended
March 31, 2002 as compare to $1.6 million for the quarter ended March 31, 2001. This decrease is principally due to a decrease in funds at corporate headquarters for the quarter
ended March 31, 2002 as compared to the same period in the prior year.

Equity in income (losses) of unconsolidated investees.Equity in losses of unconsolidated investees decreased by
$7.0 million to an income of $0.5 million for the quarter ended March 31, 2002 as compared to a loss of $6.5 million for the quarter ended March 31, 2001. For
further information on the ventures reported under the equity method, refer to the unconsolidated results discussion below.

Foreign currency loss.Foreign currency losses increased by $0.2 million to $0.5 million for the quarter ended
March 31, 2002 as compared to $0.3 million for the quarter ended March 31, 2001.

Other income.Other income increased by $0.6 million to $0.6 million for the quarter ended March 31,
2002 as compared to nil for the quarter ended March 31, 2001.

Income tax expense.Income tax expense decreased by $0.5 million to $1.8 million for the quarter ended
March 31, 2002 as compared to $2.3 million for the quarter ended March 31, 2001. The income tax expense in 2002 and 2001 is principally from foreign income taxes on PeterStar's
operations.

Minority interest.Minority interest represents the allocation of losses by the Communications Group's majority owned
subsidiaries and joint ventures to its minority ownership interest. Minority interest increased by $0.7 million to $0.8 million for the quarter ended March 31, 2002 as compared to
$0.1 million for the quarter ended March 31, 2001. The minority interest amount relates principally to PeterStar's operations.

Cumulative effect of a change in accounting principle.The Company adopted the provisions of EITF No. 01-9
effective January 1, 2001. Accordingly, the Company recorded the cumulative effect of adoption as a charge to earnings of $2.4 million. There was no such similar charge in the quarter
ended March 31, 2002.

Net loss.Net loss decreased by $9.2 million to $17.2 million for the quarter ended March 31, 2002 as
compared to $26.4 for the quarter ended March 31, 2001.

RESULTS OF UNCONSOLIDATED OPERATIONS FOR THE QUARTER ENDED MARCH 31, 2002 COMPARED TO THE RESULTS OF UNCONSOLIDATED OPERATIONS FOR THE QUARTER ENDED MARCH 31, 2001

Fixed Telephony

Revenues.Fixed telephony revenues decreased by $1.9 million to $21.1 million for the quarter ended
March 31, 2002 as compared to $23.0 million for the quarter ended March 31, 2001. This decrease was principally attributable to revenue declines at Telecom Georgia and at Comstar.

Revenues
at Telecom Georgia decreased by $1.2 million to $4.7 million for quarter ended March 31, 2002 as compared to $5.9 million for quarter ended
March 31, 2001. This decrease in

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revenues is principally due to increased competition and rate declines. Revenues at Comstar decreased by $0.8 million to $16.0 million for the quarter ended March 31, 2002 as
compared to $16.8 million for the quarter ended March 31, 2001. This reduction is due to reductions in long distance tariffs offset by increases in data services and line rentals.

Gross margin.Fixed telephony gross margin decreased by $1.0 million to $10.2 million for the quarter ended
March 31, 2002 as compared to $11.2 million for the quarter ended March 31, 2001. This decrease is principally due to decreases at Comstar and Telecom Georgia.

Gross
margin at Comstar decreased by $0.6 million to $8.6 million for the quarter ended March 31, 2002 as compared to $9.2 million for the quarter ended
March 31, 2001. This reduction is principally due to a reduction of sales while fixed network costs remained consistent. Gross margin at Telecom Georgia decreased by $0.4 million to
$1.3 million for the quarter ended March 31, 2002 as compared to $1.7 million for the quarter ended March 31, 2001, due to lower rates and increased competition.

Selling, general and administrative.Fixed telephony selling, general and administrative expenses decreased by
$0.3 million to $5.4 million for the quarter ended March 31, 2002 as compared to $5.7 million for the quarter ended March 31, 2001. This decrease was principally the
result of decreases in expenses at Telecom Georgia. This decrease was largely as a result of staff reductions in response to the revenue loss.

Depreciation and amortization.Fixed telephony depreciation and amortization expense decreased to $5.6 million for the
quarter ended March 31, 2002 as compared to $5.8 million for the quarter ended March 31, 2001. The reduction in depreciation and amortization is principally due to the goodwill at
Telecom Georgia no longer being amortized.

Operating loss.Fixed telephony operating loss increased by $0.4 million to $0.8 million for the quarter ended
March 31, 2002 as compared to $0.4 million for the quarter ended March 31, 2001. This increase was due principally to Comstar.

Operating
results at Comstar decreased by $0.7 million to a loss of $0.1 million for the quarter ended March 31, 2002 as compared to $0.6 million income for
the quarter ended March 31, 2001. This decrease was principally due to the reduction in revenues without a corresponding reduction in selling, general and administrative expenses.

Wireless Telephony

Revenues.Wireless telephony revenues increased by $1.8 million to $13.2 million for the quarter ended
March 31, 2002 as compared to $11.4 million for the quarter ended March 31, 2001. This increase was primarily attributable to Magticom, the Company's GSM wireless operator in
Georgia.

Revenues
at Magticom increased by $1.7 million to $10.4 million for quarter ended March 31, 2002 as compared to $8.7 million for quarter ended
March 31, 2001. This increase in revenues is due to strong growth in the subscriber base.

Gross margin.Wireless telephony gross margin increased by $2.1 million to $11.3 million for the quarter ended
March 31, 2002 as compared to $9.2 million for the quarter ended March 31, 2001. This increase was due primarily to the increase in gross margin at Magticom.

Gross
margin at Magticom increased by $1.6 million to $9.1 million for the quarter ended March 31, 2002 as compared to $7.5 million for the quarter ended
March 31, 2001. This increase is due to the strong revenue growth with fixed costs held relatively constant.

Selling, general and administrative.Wireless telephony selling, general and administrative expenses decreased by
$0.5 million to $2.4 million for the quarter ended March 31, 2002 as compared to

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$2.9 million for the quarter ended March 31, 2001. This decrease is principally related to decreased expenses at BELCEL and Magticom.

Selling,
general and administrative expenses at BELCEL decreased by $0.5 million to $0.7 million for the quarter ended March 31, 2002 as compared to
$1.2 million for the quarter ended March 31, 2001. This decrease is principally related to certain accruals recorded in 2001, which are not required in 2002. Selling, general and
administrative expenses at Magticom decreased by $0.1 million to $1.4 million for the quarter ended March 31, 2002 as compared to $1.5 million for the quarter ended
March 31, 2001.

Depreciation and amortization.Wireless telephony depreciation and amortization expense increased by $0.8 million to
$3.7 million for the quarter ended March 31, 2002 as compared to $2.9 million for the quarter ended March 31, 2001. This increase is due principally to Magticom.

Depreciation
and amortization at Magticom increased by $0.9 million to $3.0 million for the quarter ended March 31, 2002 as compared to $2.1 million for the
quarter ended March 31, 2001. This increase is principally related to capital expenditures supporting network expansion and increasing subscriber capacity.

Operating income.Wireless telephony operating income increased by $1.7 million to $5.1 million for the quarter
ended March 31, 2002 as compared to $3.4 million for the quarter ended March 31, 2001. This increase is due to Magticom, Tyumenruskom and BELCEL.

Operating
income at Magticom increased by $0.8 million to $4.7 million for the quarter ended March 31, 2002 as compared to $3.9 million for the quarter ended
March 31, 2001. This increase is due to improvements in gross margin, reductions in selling, general and administrative expenses offset partially by additional depreciation expenses relating to
capital expenditures. Operating loss at Tyumenruskom decreased by $0.5 million to an operating income of $0.3 million for the quarter ended March 31, 2002 as compared to an
operating loss of $0.2 million for the quarter ended March 31, 2001. Operating loss at BELCEL decreased by $0.4 million to an operating income of $0.1 million for the
quarter ended March 31, 2002 as compared to an operating loss of $0.3 million for the quarter ended March 31, 2001.

Cable Television

Revenues.Cable television revenues decreased by $0.1 million to $6.4 million for the quarter ended
March 31, 2002 as compared to $6.5 million for the quarter ended March 31, 2001. This decrease in revenues is due principally to a decrease in revenue from Kamalak TV, on which
the Company no longer reports as such venture was abandoned effective December 31, 2001. This decrease is offset by increases in revenue at Kosmos TV and Alma-TV.

Revenues
at Kosmos TV increased by $0.5 million to $1.8 million for the quarter ended March 31, 2002 as compared to $1.3 million for the quarter ended
March 31, 2002. Revenues at Alma-TV increased by $0.2 million to $2.0 million for the quarter ended March 31, 2002 as compared to $1.8 million for the
quarter ended March 31, 2002.

Gross margin.Cable television gross margin increased by $0.9 million to $5.0 million for the quarter ended
March 31, 2002 as compared to $4.1 million for the quarter ended March 31, 2001. This increase is primarily related to Kosmos TV and Alma-TV.

Gross
margin at Kosmos TV increased by $0.7 million to $1.5 million for the quarter ended March 31, 2002 as compared to $0.8 million for the quarter ended
March 31, 2002, due to certain accruals recorded in 2001 that are no longer required. Gross margin at Alma-TV increased by $0.2 million to $1.7 million for the quarter
ended March 31, 2002 as compared to $1.5 million for the quarter ended March 31, 2001.

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Selling, general and administrative.Cable television selling, general and administrative expenses decreased by
$2.2 million to $3.3 million for the quarter ended March 31, 2002 as compared to $5.5 million for the quarter ended March 31, 2001. This decrease is principally due
to decreases at Kamalak TV, Kosmos TV and Baltcom TV.

Selling,
general and administrative expenses at Kosmos TV decreased by $0.5 million to $1.0 million for the quarter ended March 31, 2002 as compared to
$1.5 million for the quarter ended March 31, 2001, due to certain accruals recorded in 2001 that are no longer required. Selling, general and administrative expenses at Baltcom TV
decreased by $0.5 million to $1.0 million for the quarter ended March 31, 2002 as compared to $1.5 million for the quarter ended March 31, 2001. Selling, general and
administrative expenses incurred at Kamalak TV in 2001 amounted to $0.5 million with none reported in 2002.

Depreciation and amortization.Cable television depreciation and amortization expense decreased by $1.1 million to
$1.9 million for the quarter ended March 31, 2002 as compared to $3.0 million for the quarter ended March 31, 2001. This decrease was principally due to decreases at
Kamalak TV, Kosmos TV and Cosmos Minsk.

Depreciation
and amortization expense at Kosmos TV decreased by $0.2 million to $0.6 million for the quarter ended March 31, 2002 as compared to $0.8 million
for the quarter ended March 31, 2001. This decrease is due to the $0.6 million reduction in goodwill amortization offset by general increases in fixed assets in service. Depreciation and
amortization expense at Cosmos Minsk decreased by $0.2 million to $0.1 million for the quarter ended March 31, 2002 as compared to $0.3 million for the quarter ended
March 31, 2001. Depreciation and amortization expense at Kamalak TV amounted to $0.5 million for the quarter ended March 31, 2001 with none reported in 2002.

Operating loss.Cable television operating loss decreased by $4.2 million to $0.1 million for the quarter ended
March 31, 2002 as compared to $4.3 million for the quarter ended March 31, 2001. This decrease is due principally to improvements at Kosmos TV and the Kamalak loss recorded in
2001 of $1.0 million which is not included in 2002.

Radio Broadcasting

Radio broadcasting activities for unconsolidated investees in 2002 ceased due to Trio Radio, which the Company consolidated from September 2001.

Critical Accounting Policies

The Company reviews all significant estimates affecting its consolidated financial statements on a recurring basis and records the effect of any necessary
adjustment prior to their publication. Uncertainties with respect to such estimates and assumptions are inherent in the preparation of financial statements; accordingly, it is possible that actual
results could differ from those estimates and changes to estimates could occur in the near term. The preparation of the Company's financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of the contingent assets and liabilities at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period. Estimates and judgements are used when accounting for the allowance for doubtful accounts, inventory obsolescence, long-lived assets,
intangible assets, recognition of revenue, assessing control over operations of business ventures, product warranty expenses, self-insured workers' compensation and product liability
claims, depreciation and amortization, employee benefit plans, income taxes and contingencies, among others. The Company believes the following critical accounting policies affect its

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more significant judgments and estimates used in the preparation of its consolidated financial statements:



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New Accounting Pronouncements

Business Combinations and Goodwill and Intangible Assets

On January 1, 2002, we adopted SFAS No. 141, "Business Combinations" and SFAS No. 142, "Goodwill and Intangible Assets." SFAS No. 141
requires that the purchase method be used for all business combinations initiated after June 30, 2001. SFAS No. 142 eliminates the amortization of goodwill and intangible assets deemed
to have indefinite lives and instead requires that such assets be subject to annual impairment tests. Goodwill amortization (including that of goodwill included in Equity in losses of unconsolidated
subsidiaries) in the first quarter of 2001 totaled $5.7 million ($0.06 per share). The Company has not completed the first step of the transitional goodwill impairment testing. Such testing is
expected to be complete by the end of the second quarter of 2002 as allowed under the provisions of SFAS No. 142.

Accounting for the Impairment or Disposal of Long-Lived Assets

In August 2001, the Financial Accounting Standards Board issued FASB Statement No. 144, "Accounting for the Impairment or Disposal of
Long-Lived Assets" ("SFAS No. 144"), which supersedes both FASB Statement No. 121, "Accounting for the Impairment of Long-Lived Assets and for Long Lived Assets
to Be Disposed Of" ("SFAS No. 121") and the accounting and reporting provisions of APB Opinion No. 30, "Reporting the Results of OperationsReporting the Effects of Disposal
of a Segment of a Business, and Extraordinary, Unusual and Infrequently Occurring Events and Transactions" (Opinion 30), for the disposal of a segment of a business (as previously defined in that
Opinion). SFAS No. 144 retains the fundamental provisions in SFAS No. 121 for recognizing and measuring impairment losses on long-lived assets held for use and
long-lived assets to be disposed of by sale, while also resolving significant implementation issues associated with SFAS No. 121. For example, SFAS No. 144 provides guidance
on how a long-lived asset that is used as part of a group should be evaluated for impairment, establishes criteria for when a long-lived asset is held for sale, and prescribes
the accounting for a long lived asset that will be disposed of other than by sale. SFAS No. 144 retains the basic provisions of Opinion 30 on how to present discontinued operations in the
income statement but broadens that presentation to include a component of an entity (rather than a segment of a business). Unlike SFAS No. 121, an impairment assessment under SFAS
No. 144 will never result in a write-down of goodwill. Rather, goodwill is evaluated for impairment under SFAS No. 142, "Goodwill and Other Intangible
Assets". The Company adopted SFAS No. 144 effective January 1, 2002. The adoption of SFAS No. 144 did not have a material impact on the Company's financial statements.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

In the normal course of business, the financial position of the Company is routinely subjected to a variety of risks. In addition to the market risk associated
with interest rate movements on outstanding debt and currency rate movements on non-U.S. dollar denominated assets and liabilities, other examples of risk include collectibility of
accounts receivable and significant political, economic and social risks inherent in doing business in emerging markets such as Eastern Europe, the CIS and China.

Since
Snapper's bank debt is a floating rate instrument, its carrying value approximates its fair value. A 100 basis point increase in the level of interest rates with all other
variables held constant would result in an increase in interest expense of $7,000 for the quarter ended March 31, 2002. In addition, a 100 basis point increase in interest rates on Snapper's
floor plan financing for dealers would have resulted in an increase in interest of $7,000 for the quarter ended March 31, 2002.

With
the exception of certain vendor financing at the operating business level (approximately $2.3 million in the aggregate), the Company's debt obligations and those of its
operating businesses are fixed rate obligations, and are therefore not exposed to market risk from changes in interest rates. The Company does not believe that it is exposed to a material market risk
from changes in interest rates. Furthermore, with the exception of the approximately $2.0 million in vendor financing which is

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denominated in Euros, the Company's long-term debt and that of its operating businesses are denominated in U.S. dollars. The Company does not believe that the Communications Group's debt
not denominated in U.S. dollars exposes the Company to a material market risk from changes in foreign exchange rates.

The
Company does not hedge against foreign exchange rate risks at the current time. In the majority of the countries that the Communications Group's business ventures operate, there
currently do not exist derivative instruments to allow the Communications Group to hedge foreign currency risk. In addition, at the current time the majority of the Communications Group's business
ventures are in the early stages of development and the Company does not expect in the near term to repatriate significant funds from the Communications Group's business ventures.

Special Note Regarding Forward-Looking Statements

Certain statements in this Form 10-Q including, without limitation, statements under Part I. Item 2. "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and Part II. Item 1. "Legal Proceedings," constitute "forward-looking statements" within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Certain, but not necessarily all, of such forward-looking statements can be identified by
the use of forward-looking terminology, such as "believes," "expects," "may," "will," "should" or "anticipates" or the negative thereof or other variations thereon or comparable terminology, or by
discussions of strategy that involves risks and uncertainties. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results,
performance or achievements of the Company, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking
statements. Such factors include, among others, the following: liquidity issues facing the Company, including the restructuring of the Company's senior indebtedness; general economic and business
conditions, which will, among other things, affect demand for the Company's products and services; industry capacity, which tends to increase during strong years of the business cycle; changes in
public taste and industry trends; demographic changes; competition from other communications companies, which may affect the Company's ability to enter into or acquire new business ventures or to
generate revenues; political, social and economic conditions and changes in laws, rules and regulations or their administration or interpretation, particularly in Eastern Europe and the CIS, China and
selected other emerging markets, which may affect the Company's results of operations or limit or reduce the level of the Company's ownership interests in its business ventures; timely completion of
construction projects for new systems for the business ventures in which the Company has invested, which may impact the costs of such projects; developing legal structures in emerging markets, which
may affect the Company's results of operations; cooperation of local partners for the Company's communications investments in emerging markets, which may affect the Company's results of operations;
exchange rate fluctuations; license renewals for the Company's communications investments in emerging markets; the loss of any significant customers; changes in business strategy or development plans;
quality of management; availability of qualified personnel; changes in or the failure to comply with government regulations; ability of the Company to consummate the spin-off or sale of
its businesses; obtaining the requisite consents for any spin-off or sale of the Company's businesses; the timing and structure of any spin-off or sale of the Company's
businesses; the consideration or values obtained by the Company for any businesses that are spun off or sold; and other factors referenced herein. Any forward-looking statement speaks only as of the
date on which it is made. New factors emerge from time to time and it is not possible for the Company to predict which will arise. In addition, the Company cannot assess the impact of each factor on
its business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statement.

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PART IIOTHER INFORMATION

Item 1. Legal Proceedings

Updated information on litigation and environmental matters subsequent to December 31, 2001 is as follows:

Fuqua Industries, Inc. Shareholder Litigation

For a description of this proceeding through December 31, 2001, see Item 3 in the Company's Annual Report on Form 10-K for the year
ended December 31, 2001.

On
May 2, 2002, Chancellor Chandler issued a decision granting in part and denying in part plaintiffs' motion to compel production of documents. In his decision, the Chancellor
determined that some of the documents as to which the Company had asserted the attorney-client privilege in the litigation would have to be produced, but declined to order the Company to produce
documents for which the work product privilege had been asserted.

RDM Sports Group, Inc.

For a description of this proceeding through December 31, 2001, see Item 3 in the Company's Annual Report on Form 10-K for the year
ended December 31, 2001.

By
orders dated March 8, 2002, the court scheduled oral argument on the Company's motions to dismiss the first amended complaints in the Equitable Subordination Proceedings (Adv.
Proc. No. 99-1023 and
Adv. Proc. No. 99-1029) and on the motion of current and former officers of the Company named as defendants in the D and O Proceeding (Adv. Proc. No. 98-1128) to
dismiss the second amended complaint in the D and O Proceeding. Oral argument was held on these motions on April 12, 2002. The court has not issued any decision on these motions.

The
Company believes that it has meritorious defenses and plans to defend vigorously these actions. Due to the status of these proceedings, the Company cannot evaluate the likelihood of
an unfavorable outcome or estimate the likely amount or range of possible loss, if any. Accordingly, the Company has not recorded any liability in connection with these adversary proceedings.

Barberis v. Kluge, et al.

For a description of this proceeding, see Item 3 in the Company's Annual Report on Form 10-K for the year ended December 31, 2001.

Arbitration Award to Former Employee

The Company was in arbitration with one former member of the Company's management arising out of the termination of his employment with the Company. The private
arbitration, in which the former employee was seeking damages for breach of his employment agreement in the amount of $1.3 million, was commenced in February 2001. The Company believes
that such former employee was terminated for "cause" while the employee asserted that his termination was without cause and that he is entitled to the compensation provided for in his employment
agreement. In May 2002, the arbitrators issued a decision awarding the former employee $1.5 million in damages (and pre-judgement interest) and reserved as to whether to
award attorneys' fees to the former employee. The Company is evaluating its legal options at this time.

Indemnification Agreements

In accordance with Section 145 of the General Corporation Law of the State of Delaware, pursuant to the Company's Restated Certificate of Incorporation,
the Company has agreed to

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indemnify its officers and directors against, among other things, any and all judgments, fines, penalties, amounts paid in settlements and expenses paid or incurred by virtue of the fact that such
officer or director was acting in such capacity to the extent not prohibited by law.

Item 6. Exhibits and Reports of Form 8-K

|Exhibit
Number |  | Description                          
|-------------- |  | -------------------------------------
|(a)            |  | Exhibits                             
|               |  | 11* Computation of Earnings Per Share
|(b)            |  | Reports on Form 8-K                  
|               |  | None                                 

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SIGNATURE

Pursuant to the requirements of Section 13 or 15(d) of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

| |  | METROMEDIA INTERNATIONAL GROUP, INC.
| |  | ------------------------------------
| |  | By:                                 

Dated:
May 15, 2002

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