The first company to offer global satellite phone services announced disappointing results yesterday in a blaze of controversy.

Iridium is just one of several Bermuda-registered telephone companies -- including BTC-aligned Globalstar and ICO -- competing in the billion-dollar race to launch phone systems which roam anywhere rather than land-lines.

Yesterday Iridium World Communications Inc. announced a $505 million or $3.45 a share first-quarter net loss -- an even poorer showing than last year's figures which showed a net loss of $205 million or $1.45 a share.

Iridium posted revenues for the quarter of $1.45 million after reporting no revenue a year earlier -- but this year's figure fell far short of some analysts predictions of revenue approaching the $7.5 million mark.

The company put a brave face on the results with one spokesman insisting Iridium was going through a "period of transition'' from which it would emerge stronger than ever. And early trading saw Iridium shares edge up.

Almost 10,300 subscribers have signed up for the Iridium system including 7,188 satellite customers, 1,031 cellular customers and 2,075 satellite paging customers.

The disappointing results come on top of widespread reports of turmoil in the company after CEO Ed Staiano's shock resignation on Thursday which followed disagreements on strategy with the board of directors.

His departure followed the resignation earlier this month of another top executive and sparked a sharp 14 percent fall in the value of Iridium shares on the Nasdaq stock exchange on Thursday and Friday to $16.

A potentially massive law suit was also filed last week in New York by aggrieved investors who allege the company and its directors had issued misleading figures, stated false goals and hid flaws in the system.

Hastily appointed interim chief executive John Richardson admitted times were tough yesterday.

"Although we have succeeded in building a network that is providing high-quality service to our customers, we were very disappointed with our first quarter customer and revenue numbers,'' he said.

"Clearly we have a great deal of work to do to improve our marketing, distribution and sales activities all over the world.'' But he put a brave face on the results, insisting that the company was still confident of substantial demand for satellite phones.

He confirmed the company had moved to revamp its packaging and marketing strategies while cost-cutting and adjusting prices -- which stand at $3,000 for a handset.

Iridium chief puts on brave face despite losses A company spokesman said the focus was "getting sales going'' but the immediate concern was renegotiating the terms of loans by the end of May. He also said the company had learned a valuable lesson from the first quarter results -- that the company needed to be more careful of projections.

"But we're obviously trying to bring subscriber equipment in customer hands as soon as possible as we go through this period of significant transition.'' Several factors hindered Iridium's revenues including limited availability of handsets in some markets and distribution delays, the company said.

The Iridium project -- a $5 billion global network of 66 low-earth-orbit satellites linked to ground stations -- has been dogged by service and equipment delays and has also faced financing headaches.

Iridium chief puts on brave face despite losses A company spokesman said the focus was "getting sales going'' but the immediate concern was renegotiating the terms of loans by the end of May. He also said the company had learned a valuable lesson from the first quarter results -- that the company needed to be more careful of projections.

"But we're obviously trying to bring subscriber equipment in customer hands as soon as possible as we go through this period of significant transition.'' Several factors hindered Iridium's revenues including limited availability of handsets in some markets and distribution delays, the company said.

The Iridium project -- a $5 billion global network of 66 low-earth-orbit satellites linked to ground stations -- has been dogged by service and equipment delays and has also faced financing headaches.