NEW YORK - March 28, 2006 - Loral Space & Communications Inc. (NASDAQ: LORL) today reported its financial results for the periods ended December 31, 2005.

Loral emerged from bankruptcy on November 21, 2005. Its financial statements reflect fresh-start accounting effective October 1, 2005. References to full-year 2005 financial information throughout this release combine the periods of January 1, 2005 to October 1, 2005 (old Loral) with October 2, 2005 to December 31, 2005 (new Loral). A reconciliation of the two periods is provided in the accompanying tables. References to the fourth quarter of 2005 refer to the period from October 2, 2005 through December 31, 2005.

A full discussion of Loral's results and important information regarding fresh-start accounting are contained in the company's Form 10-K, filed today with the Securities and Exchange Commission (SEC) and available on Loral's web site at www.loral.com or through the SEC's EDGAR service at www.sec.gov.

Financial Results for the Periods Ended December 31, 2005

For the full year 2005, Loral's revenue was $626 million, an increase from $522 million in 2004. New orders at Space Systems/Loral coupled with a full year of service on Loral Skynet's new Telstar 18 satellite led to the overall increase. In 2005, Loral's net loss, excluding a $1.102 billion gain on the discharge of pre-petition obligations and fresh-start adjustments, was $74 million, versus a net loss of $177 million in 2004. Loral's 2005 Adjusted EBITDA (1) was $37 million versus an Adjusted EBITDA loss of $49 million in 2004.

Fourth quarter revenue was $197 million, an increase over $106 million in the fourth quarter of 2004. The company's net loss in the fourth quarter of 2005 was $15 million versus a net loss of $43 million in the fourth quarter of 2004. In the fourth quarter of 2005, Loral's Adjusted EBITDA was $11 million, compared to an Adjusted EBITDA loss of $20 million for the fourth quarter of 2004.

Increases in Adjusted EBITDA for the quarter and the year were driven by increased sales and improved operating performance at both business units.

Loral ended 2005 with $276 million in cash and cash equivalents. All undisputed pre-petition claims and chapter 11 expenses have been satisfied with the exception of $54 million to be paid in 2006. Principal amount of long-term debt at year-end 2005 was $126 million.

Satellite Manufacturing

Space Systems/Loral (SS/L), the company's satellite manufacturing subsidiary, had 2005 revenues before eliminations of $491 million, compared to $437 million in 2004. Adjusted EBITDA for SS/L in 2005 was $27 million, compared to an Adjusted EBITDA loss of $14 million in 2004.

For the fourth quarter, SS/L had revenues before eliminations of $162 million, versus $137 million in the fourth quarter of 2004. SS/L Adjusted EBITDA in the fourth quarter was $12 million, up from an Adjusted EBITDA loss of $12 million in the year-ago quarter. SS/L results were driven by increased sales and improved performance on programs in process.

As a result of four new construction awards in 2005, backlog at SS/L at December 31, 2005 rose to $815 million, including intercompany backlog of $0.3 million. At year-end 2004, SS/L's backlog totaled $483 million, with intercompany backlog of $12 million.

In 2005, SS/L delivered five satellites, including iPSTAR, the largest commercial communications satellite ever placed into orbit. In addition to Spainsat, which was launched on March 11, four satellites currently under construction at SS/L are scheduled for launch in 2006.

Satellite Services

Loral Skynet, the company's satellite services subsidiary, had 2005 revenues before eliminations of $152 million, up from $141 million (excluding $87 million from a sales-type lease arrangement in 2004) in 2004. The increase was driven primarily by a full year of service from Telstar 18, which entered service in August 2004, and increased utilization across Skynet's fleet. At the end of 2005, utilization on Loral Skynet's satellite fleet was 70 percent compared to 60 percent at the end of 2004.

Adjusted EBITDA for Loral Skynet in 2005 totaled $51 million, compared to 2004's $16 million (excluding $7.7 million associated with the sales-type lease arrangement).

Loral Skynet's fourth quarter 2005 revenues before eliminations totaled $37 million, versus $36 million in the same period a year ago. Adjusted EBITDA for Skynet in the fourth quarter was $12 million, versus $9 million in the fourth quarter of 2004.

Satellite services backlog on December 31, 2005, was $453 million versus $543 million at the end of 2004. Nearly three times current annual revenue, 2005 backlog includes intercompany backlog of $20 million and 2004 backlog includes $33 million of intercompany backlog.

On March 18, 2006, Loral Skynet resumed offering fixed satellite services (FSS) to customers in North America. It had been precluded from offering basic FSS capacity leasing services to customers in North America for two years pursuant to Loral's agreement to sell certain of its North American assets to Intelsat in March 2004.

In addition, Loral Skynet recently announced the start of construction of Telstar 11N, a new multi-beam Ku-band satellite designed to take advantage of commercial and government opportunities in key growth areas across the Americas, Europe and Africa. Skynet expects the satellite to enter service in 2008.

Loral Space & Communications is a satellite communications company. It owns and operates a fleet of telecommunications satellites used to broadcast video entertainment programming, distribute broadband data, and provide access to Internet services and other value-added communications services. Loral also is a world-class leader in the design and manufacture of satellites and satellite systems for commercial and government applications including direct-to-home television, broadband communications, wireless telephony, weather monitoring and air traffic management.

This document contains 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. In addition, Loral Space & Communications Inc. or its representatives have made or may make forward-looking statements, orally or in writing, which may be included in, but are not limited to, various filings made from time to time with the Securities and Exchange Commission, press releases or oral statements made with the approval of an authorized executive officer of the company. Actual results could differ materially from those projected or suggested in any forward-looking statements as a result of a wide variety of factors and conditions. Many of these factors and conditions are described in the section of the annual report on Form 10-K for the fiscal year ended December 31, 2005 of Loral Space & Communications Inc., entitled "Risk Factors," and the company's other filings with the Securities and Exchange Commission. The reader is specifically referred to these documents.

(1) The common definition of EBITDA is "Earnings Before Interest, Taxes, Depreciation and Amortization". In evaluating financial performance, we use revenues and operating income (loss) from continuing operations before depreciation and amortization, including amortization of unearned stock compensation, and reorganization expenses due to bankruptcy ("Adjusted EBITDA") as the measure of a segment's profit or loss. Adjusted EBITDA is equivalent to the common definition of EBITDA before amortization of stock compensation; reorganization expenses due to bankruptcy; gain on discharge of pre-petition obligations and fresh-start adjustments, gain (loss) on investments; other income (expense); equity in net income (losses) of affiliates, minority interest, net of tax; income (loss) from discontinued operations, net of taxes; cumulative effect of change in accounting principle, net of tax, and extraordinary gain on acquisition of minority interest, net of tax. Interest expense has been excluded from Adjusted EBITDA to maintain comparability with the performance of competitors using similar measures with different capital structures. During the period we were in Chapter 11, we only recognized interest expense on the actual interest payments we made. During this period, we did not expect to make any further interest payments on our debt obligations after March 17, 2004, the date we repaid our secured bank debt. Reorganization expenses due to bankruptcy were only incurred during the period we were in Chapter 11. These expenses have been excluded from Adjusted EBITDA to maintain comparability with our results during periods we were not in Chapter 11 and with the results of competitors using similar measures. Adjusted EBITDA should be used in conjunction with U.S. GAAP financial measures and is not presented as an alternative to cash flow from operations as a measure of our liquidity or as an alternative to net income as an indicator of our operating performance.

We believe the use of Adjusted EBITDA along with U.S. GAAP financial measures enhances the understanding of our operating results and is useful to investors in comparing performance with competitors, estimating enterprise value and making investment decisions. A full reconciliation of Adjusted EBITDA to net loss is included in the accompanying tables to this report and also in Loral's annual report on Form 10-K, available on the company's web site at www.loral.com or on the SEC's EDGAR service at www.sec.gov.