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________________________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
______________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
______________
Date of Report (Date of earliest event reported): October 20, 1999
PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED
(Exact name of registrant as specified in its charter)
DELAWARE 0-29092 54-1708481
(State or Other Jurisdiction of (Commission (IRS Employer
Incorporation) File Number) Identification No.)
1700 OLD MEADOW ROAD, SUITE 300, MCLEAN, VIRGINIA 22102
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (703) 902-2800
________________________________________________________________________________
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ITEMS 1-4. NOT APPLICABLE.
ITEM 5.
Set forth below is our Unaudited Pro Forma Consolidated Statement of
Operations for the six months ended June 30, 1999:
PRIMUS TELECOMMUNICATIONS GROUP, INCORPORATED
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1999
(In thousands, except per share amounts)
<TABLE>
<CAPTION>
Adjustments
----------------------
Notes Pro Forma
Primus(1) Telegroup(2) Telegroup Issuances As Adjusted
--------- ------------ --------- --------- -----------
<S> <C> <C> <C> <C> <C>
Net revenue............. $316,854 $101,618(3) $(5,676)(4) $ -- $409,755
(3,041)(5)
Cost of revenue......... 247,456 67,584 (5,421)(4) -- 309,619
-------- -------- ------- -------- --------
Gross margin............ 69,398 34,034 (3,296) -- 100,136
Operating expenses:
Selling, general, and
administrative....... 70,849 34,822 (114)(4) -- 102,516
(3,041)(5)
Depreciation and
amortization......... 21,490 5,709 (1,100)(7) -- 28,233
2,134 (8)
-------- -------- ------- -------- --------
Total operating
expenses........... 92,339 40,531 (2,121) -- 130,749
-------- -------- ------- -------- --------
Gain (loss) from
operations............. (22,941) (6,497) (1,175) -- (30,613)
Interest expense........ (34,293) (6,500) 6,500 (6) (2,558)(9) (36,851)
Interest income......... 6,011 221 6,232
Other income............ (32) (32)
-------- -------- ------- -------- --------
Gain (loss) before
income taxes........... (51,223) (12,808) 5,325 (2,558) (61,264)
Income taxes............ (225) (225)
-------- -------- ------- -------- --------
Net loss................ $(51,223) $(13,033) $ 5,325 $ (2,558) $(61,489)
======== ======== ======= ======== ========
Basic and diluted net
loss per share......... $ (1.80) $ (2.16)
======== ========
Weighted average number
of shares.............. 28,402 28,402
======== ========
</TABLE>
- --------
(1) Represents the historical results of our operations for the six months
ended June 30, 1999.
(2) Represents the historical results of operations of Telegroup for the five
months ended May 31, 1999.
Telegroup Adjustments:
(3) Does not give effect to the attrition in Telegroup's retail customer and
agent base, which began to occur prior to our acquisition of Telegroup and
which we expect to continue into the near future.
(4) To eliminate wholesale net revenue, cost of revenue, and selling, general
and administrative expenses, as this component of the Telegroup business
had been substantially eliminated prior to the purchase by Primus.
(5) To reflect the reclassification of bad debt expenses from selling, general
and administrative expenses to a reduction of net revenue to conform to
Primus's accounting policies.
(6) To eliminate interest expense on non-purchased obligations.
(7) To reverse amortization expense associated with Telegroup's previously
acquired customer list, the excess of purchase price over the fair value of
net assets acquired, depreciation and amortization of non-purchased fixed
and cable assets, and amortization related to debt financing costs.
(8) To record amortization expense associated with acquired customer list and
the excess of purchase price over the fair value of net assets acquired.
Notes Issuances:
(9) To reflect the interest expense on the $45.5 million of senior notes issued
in June 1999 in connection with the Telegroup acquisition.
ITEMS 6-8. NOT APPLICABLE.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
PRIMUS TELECOMMUNICATIONS
GROUP, INCORPORATED
By: /s/ Neil L. Hazard
------------------------
Neil L. Hazard
Executive Vice President
and Chief Financial Officer
Date: October 20, 1999
