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UNITED STATES
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) November 4, 1997
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IXC Communications, Inc.
(Exact name of registrant as specified in its charter)
Delaware 0-20803 74-2644120
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(State or other (Commission (I.R.S. Employer
jurisdiction File Number) Identification No.)
of incorporation)
5000 Plaza on the Lake, Suite 200, Austin, Texas 78746
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (512) 328-1112
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Not applicable
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(Former name or former address, if changed since last report.)
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ITEM 5. OTHER EVENTS.
Attached as Exhibit 99.1 is a press releases issued by IXC
Communications, Inc. dated November 4, 1997 which is hereby incorporated by
reference herein.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(C) EXHIBITS
99.1 Press Release dated November 4, 1997
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SIGNATURE
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.
Date: November 4, 1997
IXC Communications, Inc.
By: /s/ James F. Guthrie
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James F. Guthrie
Executive Vice President
and Chief Financial Officer
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EXHIBIT INDEX
Exhibit
Number Description
- ------- -----------
99.1 Press Release dated November 4, 1997
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NEWS RELEASE
EXHIBIT 99.1
IXC Communications, Inc. Announces Third Quarter Results; EBITDA
Reaches $6.1 Million vs ($3.9) Million in 2nd Quarter
Austin. Texas November 4, 1997 - - IXC Communications, Inc. (Nasdaq: IIXC)
announced today that revenues for the third quarter of 1997 increased 84.0% to
$112.2 million, from $61.0 million for the third quarter of 1996. The net loss
for the third quarter was $26.8 million, or ($1.08) per common share, compared
with a net loss of $5.6 million, or ($0.19) per common share for the third
quarter of 1996. Earnings before interest, taxes, depreciation and amortization
(EBITDA) were $6.1 million in the third quarter of 1997, compared to
$5.2 million in the third quarter of 1996.
Revenues increased $51.2 million in the third quarter of 1997 versus the third
quarter of 1996, with long distance revenues growing $35.0 million, or 99.4%,
and private line revenues increasing $16.2 million or 62.8%. The increase in
EBITDA resulted from the growth of revenues, partially offset by increased
access costs related to the growth in switch traffic, additional costs of
leasing off-net circuits to support revenue growth, and operating costs related
to the Company's expanding operations. The net loss for the third quarter also
reflected increased depreciation related to the Company's fiber expansion
program, losses related to the Company's long distance joint venture interest in
Mexico (MarcaTel) and goodwill amortization relating to the Company's
acquisition of Telecom One. Earnings per share for the third quarter included
the impact of dividends relating to preferred stock, including the two classes
of preferred stock issued during 1997.
For the first nine months of 1997, revenues increased 118.8% to $285.0 million,
from $130.3 million in the comparable period in 1996. The net loss for this
period in 1997 was $75.5 million, or ($2.76) per common share, compared to a net
loss of $29.4 million, or ($1.13) per common share for 1996. EBITDA for the
first nine months of 1997 was $0.5 million, compared to $6.0 million in the
comparable period of 1996.
"We are pleased with the continued rapid growth in operating revenues, and with
the turnaround in EBITDA during the quarter," said Ben Scott, IXC Chief
Executive Officer. "With our expanded revenues, and the reductions we have
experienced in line cost, our gross margin
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improved almost 93% over the second quarter, and EBITDA improved to a positive
$6.1 million from a negative $3.9 in the prior quarter."
"It is particularly gratifying that we have reduced our EBITDA losses in the
switched long distance business by over 50%, from the second quarter as a result
of the Company's previously announced cost reduction program as well as the
mandated reductions in access cost which became effective on July 1st. We hope
to achieve further improvements in the switched long distance business as a
result of our cost reduction program and the network efficiencies resulting from
our fiber build, the deployment of our new switching platform and, the
deployment of our enhanced service delivery platform," said Mr. Scott.
Mr. Scott noted that IXC had been extremely active during the quarter
in building its business on a number of fronts, including the following:
-- Agreement to form a long-term alliance with PSINet, one of the
nation's largest Internet service providers, in which IXC will provide
PSINet with 10,000 OC-48-equivalent route miles for 20 years in
exchange for 20% of PSINet's common stock, with a value guaranteed at
$240 million.
-- Issuance of $300 million of 12-1/2% Junior Exchangeable Preferred
Stock
-- Acquisition of Telecom One, a small long-distance company serving
commercial and residential customers in 32 states.
-- Agreement to sell dark fiber on its 729-mile route from Cleveland to
New York to LCI International for over $20 million. This was the second
major sale of fiber to LCI and, along with similar transactions with
other carriers, is enabling IXC to deploy its new nationwide fiber optic
network at a net cost per route mile that is about 25-30% of the
industry average.
After the end of the quarter, IXC announced a joint venture with Telenor AS, the
Norwegian national telephone company, to provide telecommunications services to
carriers and resellers in 11 European countries that account for 80% of
international traffic generated from Europe. IXC will own 40% of the joint
venture. The Company also announced an additional fiber exchange agreement with
FTV Communications, LLC, which will add 1,400 route miles to IXC's planned
20,000-mile nationwide digital network.
"We are now building both operational and strategic momentum in the business as
we continue to progress on our fiber network, improve our operating performance,
and enter into new international and Internet initiatives that are important to
our future," said Scott.
Austin, Texas-based IXC Communications, Inc. is one of the United States'
largest suppliers of voice, data and multimedia transmission services. The
Company owns and operates one of the newest nationwide digital networks and
makes network capacity available to local telephone companies, national and
regional long-distance carriers, cable and utility companies, and Internet
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Service Providers. IXC offerings include private line, broadband, and switched
and dedicated inbound and outbound calling products, and calling card and debit
card services. IXC is a publicly traded company listed on Nasdaq under the
symbol IIXC. IXC's Web site is located at www.ixc-comm.net.
IXC Communications, Inc
Summary of IXC Unaudited Results
(in thousands, except per share amounts)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30
1997 1996 1997 1996
<S> <C> <C> <C> <C>
Revenues:
Private line $ 41,948 $ 25,766 $ 111,311 $ 72,397
Switched long distance 70,292 35,250 173,704 57,876
Net operating revenue 112,240 61,016 285,015 130,273
Gross Margin 28,351 17,242 57,994 39,256
EBITDA 6,111 5,159 523 5,970
Depreciation &
Amortization 17,666 7,280 41,031 19,934
Operating Profit (11,555) (2,121) (40,508) (13,964)
Net Loss (26,788) (5,624) (75,476) (29,390)
Net loss per
common share [1.08) [0.19) [2.76) [1.13)
Weighted average
common shares 30,897 31,311 30,832 27,126
used in computation
</TABLE>
CONTACT: Investors: James F. Guthrie, Executive Vice President,
Chief Financial Officer, 512-427-3713, [email protected], or Media:
Meri Braziel, Senior Vice President of Marketing, 512-433-3535,
or [email protected], both of IXC Communications
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