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VANGUARD REPORTS FOURTH CONSECUTIVE QUARTER OF POSITIVE OPERATING CASH FLOW

 VANGUARD REPORTS FOURTH CONSECUTIVE QUARTER
 OF POSITIVE OPERATING CASH FLOW
 GREENSBORO, N.C., May 6 /PRNewswire/ -- Vanguard Cellular Systems, Inc. (NASDAQ-NMS: VCELA) today reported the Company's fourth consecutive quarter of positive operating cash flow (income from operations before depreciation and amortization) for the quarter ended March 31, 1992.
 Operating cash flow was a positive $1.5 million for the first quarter of 1992 as compared to a negative $550,000 in the first quarter of 1991, an improvement of $2.0 million. The Company first reported positive operating cash flow for the second quarter of 1991.
 Service revenues for the quarter were $17.2 million, an increase of 24 percent from the first quarter of 1991.
 Total operating costs and expenses (excluding depreciation and amortization) were $17.0 million, an increase of 10 percent from the first quarter of 1991. General and administrative expenses as a percentage of service revenues dropped from 43 percent in the first quarter of 1991 to 33 percent in the current period. Marketing and selling declined from 33 percent to 32 percent of service revenue from first quarter 1991 to 1992, respectively. Cost of service as a percentage of service revenue declined slightly from 27 percent in the first quarter of last year to 26 percent in this year's first quarter.
 The Company reported a net gain of 4,100 subscribers in the first quarter, an increase of 27 percent from a year ago and 6 percent from the previous quarter end. First quarter gross subscriber activations were the second highest in the Company's history. The total number of subscribers at the end of the first quarter, 73,300, represents an increase to a penetration level of 1.29 percent in the Company's majority-owned markets.
 Vanguard's President and Chief Executive Officer Haynes G. Griffin commented, "All indicators are pointing to slow but steady economic recovery in our markets. We feel that the Company is well-positioned to meet or exceed our expectations of strong cash flow improvements throughout 1992."
 "This is the best first quarter the Company has ever had," noted Executive Vice President and Chief Operating Officer Stephen R. Leeolou. "Gross activations, service revenue and cash flow growth have equalled or exceeded our forecasts for the first quarter of 1992. In line with our normal seasonality, we look for continued year-over- year improvement in the upcoming quarters," he added.
 The Company's 1992 first quarter net loss of $8.2 million, or ($0.33) per share, compares to a net loss of $9.9 million, or ($0.48) per share, for the same period of 1991, representing a 17 percent improvement.
 Vanguard Cellular Systems, Inc., headquartered in Greensboro, North Carolina, owns and operates cellular telephone systems in the Eastern United States. Based on its 6.1 million "pops" including pops under contract, Vanguard is the nation's third largest independent operator of solely nonwireline cellular systems.
 VANGUARD CELLULAR SYSTEMS, INC. AND SUBSIDIARIES
 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 (Dollar amounts in thousands, except per share data)
 Three Months Ended March 31,
 1992 1991
 (See Note) (See note)
 Revenues:
 Service fees $17,154 $13,834
 Cellular telephone equipment revenues 1,311 1,094
 18,465 14,928
 Costs and Expenses:
 Cost of service 4,468 3,688
 Cost of cellular telephone equipment 1,545 1,221
 Marketing and selling 5,405 4,619
 General and administrative 5,576 5,950
 16,994 15,478
 Income (loss) from operations before
 depreciation and amortization 1,471 (550)
 Depreciation and amortization (5,087) (4,349)
 Loss From Operations (3,616) (4,899)
 Equity in earnings (losses) of
 unconsolidated cellular entities (267) 19
 Net gains on dispositions of cellular
 interests -- 21
 Loss from dispositions of property
 and equipment (441) --
 Interest expense (4,155) (5,461)
 Interest income 99 164
 Loss Before Minority Interests (8,380) (10,156)
 Minority Interests 175 250
 Net Income (Loss) $(8,205) $(9,906)
 Net Income (Loss) Per Share $ (0.33) $ (0.48)
 Weighted Average Number of Common
 Shares Outstanding 24,579,853 20,783,356
 CONDENSED CONSOLIDATED BALANCE SHEETS
 March 31, December 31,
 1992 1991
 (See Note) (See Note)
 Current Assets $17,882 $22,202
 Investments in Cellular Entities 153,308 151,571
 Property and Equipment, net of
 accumulated depreciation of
 $38,929 and $36,489 73,482 74,581
 Other Assets 7,373 7,456
 Total Assets $252,045 $255,810
 Current Liabilities $11,829 $14,348
 Long-term Debt, net of current portion 188,674 183,680
 Minority Interests 5,937 6,113
 Total Shareholders Equity 45,605 51,669
 Total Liabilities and Shareholders'
 Equity $252,045 $255,810
 NOTE: The balance sheet information at December 31, 1991 and the statement of operations information for the 12 months then ended have been derived from the audited financial statements at these dates.
 -0- 5/6/92
 /CONTACT: Stan Haines, Vanguard Cellular Systems, Inc., 919-525-2100/
 (VCELA) CO: Vanguard Cellular Systems, Inc. ST: North Carolina IN: TLS SU: ERN


DF -- CH002 -- 6934 05/06/92 09:13 EDT
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Date:May 6, 1992
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