<PAGE> 1
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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2000
(COMMISSION FILE NUMBER: 0-29148)
GLOBAL TELESYSTEMS (EUROPE) LIMITED
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
ENGLAND AND WALES NONE
(State of incorporation) (I.R.S. Employer Identification
No.)
</TABLE>
MINERVA HOUSE
VALPY STREET, READING RG1 1AR UNITED KINGDOM
(Address of principal executive office)
+44 118 951 4000
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrants were required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes [X] No [ ]
The registrant is a wholly-owned subsidiary of Global TeleSystems, Inc.
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GLOBAL TELESYSTEMS (EUROPE) LIMITED
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
PART I. FINANCIAL INFORMATION
Item 1 Financial Statements of Global TeleSystems (Europe) Limited
(unaudited)
Condensed Consolidated Balance Sheets as of June 30, 2000
and December 31, 1999..................................... 3
Condensed Consolidated Statements of Operations for the
Three and Six months Ended June 30, 2000 and 1999......... 4
Condensed Consolidated Statements of Cash Flows for the Six
months Ended June 30, 2000 and 1999....................... 5
Notes to Condensed Consolidated Financial Statements........ 6
Item 2 Management's Discussion and Analysis of Financial Condition
and Results of Operations................................. 8
Item 3 Quantitative and Qualitative Disclosures About Market
Risk...................................................... 12
PART II. OTHER INFORMATION
Item 6 Exhibits and Reports on Form 8-K............................ 12
13
Signatures..............................................................
</TABLE>
2
<PAGE> 3
PART I FINANCIAL INFORMATION
ITEM 1. UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
GLOBAL TELESYSTEMS (EUROPE) LIMITED
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
2000 1999
---------- ------------
(IN THOUSANDS,
EXCEPT SHARE DATA)
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash and cash equivalents, including restricted cash...... $ 101,473 $ 49,443
Accounts receivable, net.................................. 98,404 116,100
Other assets.............................................. 42,086 22,591
---------- ----------
TOTAL CURRENT ASSETS.............................. 241,963 188,134
Property and equipment, net............................... 272,139 214,089
Goodwill and intangible assets, net....................... 583,200 603,803
Other non-current assets.................................. 17,579 587
---------- ----------
TOTAL ASSETS...................................... $1,114,881 $1,006,613
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable and other current liabilities............ $ 263,913 $ 250,354
Current portion of debt and capital lease obligations..... 13,626 17,022
---------- ----------
TOTAL CURRENT LIABILITIES......................... 277,539 267,376
Long-term debt and capital lease obligations, less current
portion................................................ 625,649 598,356
Related party long-term debt, less current portion........ 104,191 104,191
Other non-current liabilities............................. 1,605 --
---------- ----------
TOTAL LIABILITIES................................. 1,008,984 969,923
SHAREHOLDERS' EQUITY
Common stock, L0.01 par value (200,000,000 shares
authorized; 126,101,574 shares issued and
outstanding)........................................... 1,975 1,975
Additional paid-in capital................................ 745,977 527,694
Accumulated deficit....................................... (642,055) (492,979)
---------- ----------
TOTAL SHAREHOLDERS' EQUITY........................ 105,897 36,690
---------- ----------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY........ $1,114,881 $1,006,613
========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
3
<PAGE> 4
GLOBAL TELESYSTEMS (EUROPE) LIMITED
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
JUNE 30, SIX MONTHS ENDED JUNE 30,
--------------------- --------------------------
2000 1999 2000 1999
--------- -------- ----------- -----------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C>
Revenues..................................... $ 104,878 $ 81,062 $ 221,603 $ 146,976
Operating expenses:
Access and network services................ 101,770 60,184 195,052 113,599
Selling, general and administrative........ 49,459 25,518 109,462 68,137
Depreciation and amortization.............. 21,180 17,525 43,933 29,536
--------- -------- --------- ---------
Total operating expenses........... 172,409 103,227 348,447 211,272
Loss from operations......................... (67,531) (22,165) (126,844) (64,296)
Other income (expense):
Interest, net.............................. (18,867) (17,756) (37,920) (32,428)
Foreign currency losses.................... (23,046) (7,201) (28,487) (11,421)
Other non-operating income................. 962 -- 44,174 --
--------- -------- --------- ---------
(40,951) (24,957) (22,233) (43,849)
--------- -------- --------- ---------
Net loss........................... $(108,482) $(47,122) $(149,077) $(108,145)
========= ======== ========= =========
Loss per common share:
Net loss per share......................... $ (0.86) $ (0.37) $ (1.18) $ (0.86)
========= ======== ========= =========
Weighted average common shares
outstanding............................. 126,102 126,102 126,102 126,102
========= ======== ========= =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
4
<PAGE> 5
GLOBAL TELESYSTEMS (EUROPE) LIMITED
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30,
--------------------
2000 1999
-------- ---------
(IN THOUSANDS)
<S> <C> <C>
NET CASH USED IN OPERATING ACTIVITIES....................... $(96,436) $(129,853)
INVESTING ACTIVITIES
Purchases of property and equipment....................... (90,697) (33,518)
Proceeds from sale of subsidiary.......................... 45,773 --
Restricted cash and other investing activities............ 10,832 49,973
-------- ---------
NET CASH (USED IN) PROVIDED BY INVESTING
ACTIVITIES...................................... (34,092) 16,455
FINANCING ACTIVITIES
Repayments of debt........................................ (17,048) --
Capital contribution from GTS............................. 165,148 --
-------- ---------
NET CASH PROVIDED BY FINANCING ACTIVITIES......... 148,100 --
Effect of exchange rate changes on cash and cash
equivalents............................................... 49,828 (4,002)
-------- ---------
Net increase (decrease) in cash and cash equivalents........ 67,400 (117,400)
Cash and cash equivalents at beginning of period............ 16,936 166,107
-------- ---------
CASH AND CASH EQUIVALENTS AT END OF PERIOD.................. $ 84,336 $ 48,707
======== =========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Capitalization of leases.................................. $ 56,023 $ 56,654
======== =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
<PAGE> 6
GLOBAL TELESYSTEMS (EUROPE) LIMITED
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. BASIS OF PRESENTATION
Global TeleSystems (Europe) Limited ("the Company") is a European
telecommunications company, providing high quality, competitively priced,
international and national long distance telecommunications services.
The financial statements included herein are unaudited and have been
prepared in accordance with generally accepted accounting principles for interim
financial reporting and in accordance with Securities and Exchange Commission
regulations which differs in certain significant respects from the accounting
principles generally accepted in the United Kingdom. The financial results set
forth above represent the Company's financial results under US GAAP. Certain
information and footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles have been
condensed or omitted pursuant to such rules and regulations. Material
inter-company affiliate account transactions have been eliminated. In the
opinion of management, the financial statements reflect all adjustments of a
normal and recurring nature necessary to present fairly the Company's financial
position, results of operations and cash flows for the interim periods. These
financial statements should be read in conjunction with the Company's December
31, 1999 audited consolidated financial statements and the notes related
thereto. The results of operations for the six months ended June 30, 2000 may
not be indicative of the operating results for the full year.
Throughout 2000, Global TeleSystems, Inc. ("GTS") has been realigning its
legal organizational structure in order to achieve the most beneficial company
wide tax structure. Due to this realignment, the fiscal year 2000 financial
results contained herein now include subsidiaries that were previously included
elsewhere within the GTS organizational structure during 1999 and also exclude
subsidiaries that were included within the Company's fiscal year 1999 financial
results. GTS has obtained appraisals from an independent appraisal firm to
support the sale and acquisition of net assets by the Company, at their
appraised fair market value, to and from other GTS affiliates.
Certain reclassifications have been made to the prior 1999 condensed
consolidated financial statements in order to conform to the 2000 presentation.
2. RECENT ACCOUNTING PRONOUNCEMENTS
In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities," which was amended in June 1999. The Company
expects to adopt the new statement effective January 1, 2001. The statement will
require the Company to recognize all derivatives on the balance sheet at fair
value. The Company does not anticipate that the adoption of the statement will
have a significant effect on its results of operations or financial position.
3. COMPREHENSIVE INCOME (LOSS)
The following table reflects the calculation of comprehensive income (loss)
for the Company for the three and six months ended June 30, 2000 and 1999:
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
-------------------- ---------------------
2000 1999 2000 1999
--------- -------- --------- ---------
(IN THOUSANDS)
<S> <C> <C> <C> <C>
Net loss................................ $(108,482) $(47,122) $(149,077) $(108,145)
Other comprehensive income (loss).......
Foreign currency translation
adjustments........................... 50,846 917 49,197 (2,757)
--------- -------- --------- ---------
Comprehensive loss...................... $ (57,636) $(46,205) $ (99,880) $(110,902)
========= ======== ========= =========
</TABLE>
6
<PAGE> 7
GLOBAL TELESYSTEMS (EUROPE) LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
4. RELATED PARTY TRANSACTION
The Company had receivable and payable balances from affiliates of $25.6
million and $180.2 million, respectively, at June 30, 2000.
The Company derived revenue from affiliates of $20.9 million for the six
months ended June 30, 2000. Costs of revenue from affiliates were $25.2 million
for the six months ended June 30, 2000.
5. SUBSEQUENT EVENTS
On August 1, 2000, the Board of Directors of GTS formally approved a plan
of restructuring of certain of GTS's operations. This plan of restructuring is
focused on separating the GTS non-core business from its core strategic
businesses and streamlining operations, including headcount
reductions/redeployment, the centralization of finance and billing operations
and sales office consolidation.
Further, since the Company is a wholly owned subsidiary of GTS, this plan
of restructuring will have an impact on the Company's future financial results.
7
<PAGE> 8
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The following discussion and analysis relates to the financial condition
and results of operations of the Company for the three and six months ended June
30, 2000 and 1999, and certain factors that management believes are likely to
affect the Company's prospective financial condition. This information should be
read in conjunction with the Company's Condensed Consolidated Financial
Statements and the notes related thereto appearing elsewhere in this document.
SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS
Certain statements contained in "Management's Discussion and Analysis of
Financial Condition and Results of Operations" including, without limitation,
those concerning (i) projected traffic volume, (ii) future revenues and costs
and (iii) changes in the Company's competitive environment, contain
forward-looking statements concerning the Company's operations, economic
performance and financial condition. Because such statements involve risks and
uncertainties, actual results may differ materially from those expressed or
implied by such forward-looking statements.
In addition, any statements that express, or involve discussions as to,
expectations, beliefs, plans, objectives, assumptions or future events or
performance (often, but not always, through the use of words or phrases such as
"will likely result," "are expected to," "will continue," "is anticipated,"
"estimated," "intends," "plans," "projection" and "outlook") are not historical
facts and may be forward-looking and, accordingly, such statements involve
estimates, assumptions and uncertainties which could cause actual results to
differ materially from those expressed in the forward-looking statements.
Accordingly, any such statements are qualified in their entirety by reference
to, and are accompanied by, the factors discussed throughout this Report. Among
the key factors that have a direct bearing on the Company's results of
operations are the potential risk of delay in implementing the Company's
business plan; the political, economic and legal aspects of the markets in which
the Company operates; competition and the Company's need for additional
substantial financing. These and other factors are discussed and elsewhere in
this Report.
The factors described in this report could cause actual results or outcomes
to differ materially from those expressed in any forward-looking statements of
the Company made by or on behalf of the Company, and investors, therefore,
should not place undue reliance on any such forward-looking statements. Further,
any forward-looking statement speaks only as of the date on which such statement
is made, and the Company undertakes no obligation to update any forward-looking
statement or statements to reflect events or circumstances after the date on
which such statement is made or to reflect the occurrence of unanticipated
events. New factors may emerge from time to time, and it is not possible for
management to predict all of such factors. Further, management cannot assess the
impact of each such factor on the Company's business or the extent to which any
factor, or combination of factors, may cause actual results to differ materially
from those contained in any forward-looking statements.
OVERVIEW
The Company offers a range of telecommunications services and products to
three targeted customer segments: (i) retail long distance voice and fax
services for corporate customers to all global destinations either directly, via
dedicated leased lines linked to its network, or indirectly, on a switched basis
using the public telephone operator ("PTO") network by means of an access code
("Retail" or "Retail Services"); (ii) wholesale long distance traffic
termination services for other telecommunications carriers, including PTOs,
major telecommunications alliances and regional telephone companies ("Wholesale"
or "Wholesale Services"); and (iii) network management, access and termination
services to telecommunications service providers, such as calling card companies
("Service Providers"), and to resellers ("Resellers") (as a segment Service
Provider/Reseller Services).
8
<PAGE> 9
RESULTS OF OPERATIONS
The following table sets forth the Company's statement of operations as a
percentage of revenues:
<TABLE>
<CAPTION>
THREE MONTHS SIX MONTHS
ENDED JUNE 30, ENDED JUNE 30,
--------------- --------------
2000 1999 2000 1999
------ ----- ----- -----
<S> <C> <C> <C> <C>
Revenues......................................... 100.0% 100.0% 100.0% 100.0%
Access and network services...................... 97.0 74.2 88.0 77.3
Selling, general and administrative.............. 47.1 31.5 49.4 46.4
Depreciation and amortization.................... 20.2 21.6 19.8 20.0
------ ----- ----- -----
Loss from operations............................. (64.3) (27.3) (57.2) (43.7)
Interest, net.................................... (18.0) (21.9) (17.1) (22.1)
Foreign currency losses.......................... (22.0) (8.9) (12.9) (7.8)
Other non-operating income....................... 0.9 -- 19.9 --
------ ----- ----- -----
(39.1) (30.8) (10.1) (29.9)
Net loss......................................... (103.4)% (58.1)% (67.3)% (73.6)%
====== ===== ===== =====
</TABLE>
Three Months Ended June 30, 2000 Compared To The Three Months Ended June 30,
1999
Revenue. Consolidated revenue increased to $104.9 million for the three
months ended June 30, 2000 as compared to $81.1 million for the three months
ended June 30, 1999. The growth in revenue was due to the increase in customer
traffic, which resulted from the Company's increased customer base and the
acquisitions that were completed in 1999. Further, the increase in revenue was
partially offset by a decline in prices for the Company's products and services.
Access and Network Services. Access and network services costs for the
three months ended June 30, 2000 increased to $101.8 million or 97.0% of
revenues as compared to $60.2 million or 74.2% of revenues for the three months
ended June 30, 1999. The increase was due to increased settlement and
interconnect costs. The Company expects that these costs will decrease in future
periods as a result of the GTS restructuring measures initiated in the third
quarter of 2000.
Selling, General and Administrative. Selling, general and administrative
expenses for the three months ended June 30, 2000 increased to $49.5 million or
47.1% of revenues as compared to $25.5 million or 31.5% of revenues for the
three months ended June 30, 1999. The increase in selling, general and
administrative expenses in 2000 is attributable to increases in the number of
staff associated with business growth, as well as administrative and marketing
costs required for the increased customer base. The Company expects that these
costs will decrease in future periods as a result of the GTS restructuring
measures initiated in the third quarter of 2000.
Depreciation and Amortization. Depreciation and amortization for the three
months ended June 30, 2000 increased to $21.2 million or 20.2% of revenues as
compared to $17.5 million or 21.6% of revenues for the three months ended June
30, 1999. The substantial increase in depreciation and amortization costs is
attributable to the depreciation related to the expansion of the network
infrastructure. Additionally, the Company has experienced an increase in
amortization expense associated with goodwill and intangibles that have arisen
from the 1999 acquisition activities.
Interest, net. Interest for the three months ended June 30, 2000 was $18.9
million as compared to $17.8 million for the comparable period in 1999. The
increase in interest is attributable to the substantial increase in the
Company's outstanding debt obligations since the second quarter of 1999, offset
by the interest earned from short-term investments of the proceeds received from
financing activities.
Foreign Currency Loss. The Company recognized foreign currency losses of
$23.0 million in the three months ended June 30, 2000 as compared to losses of
$7.2 million in the three months ended June 30, 1999. The foreign currency
losses are primarily attributable to the effect of currency movements on the
Company's outstanding debt obligations.
9
<PAGE> 10
Six Months Ended June 30, 2000 Compared To The Six Months Ended June 30, 1999
Revenue. Consolidated revenue increased to $221.6 million for the six
months ended June 30, 2000 as compared to $147.0 million for the six months
ended June 30, 1999. The growth in revenue was due to the increase in customer
traffic, which resulted from the Company's increased customer base and the
acquisitions that were completed in 19999. Further, the increase in revenue was
partially offset by a decline in prices for the Company's products and services.
Access and Network Services. Access and network services costs for the six
months ended June 30, 2000 increased to $195.1 million or 88.0% of revenues as
compared to $113.6 million or 77.3% of revenues for the six months ended June
30, 1999. The increase was due to increased settlement and interconnect costs.
The Company expects that these costs will decrease in future periods as a result
of the GTS restructuring measures initiated in the third quarter of 2000.
Selling, General and Administrative. Selling, general and administrative
expenses for the six months ended June 30, 2000 increased to $109.5 million or
49.4% of revenues as compared to $68.1 million or 46.4% of revenues for the six
months ended June 30, 1999. The increase in selling, general and administrative
expenses in 2000 is attributable to increases in the number of staff associated
with business growth, as well as administrative and marketing costs required for
the increased customer base. The Company expects that these costs will decrease
in future periods as a result of the GTS restructuring measures initiated in the
third quarter of 2000.
Depreciation and Amortization. Depreciation and amortization for the six
months ended June 30, 2000 increased to $43.9 million or 19.8% of revenues as
compared to $29.5 million or 20.0% of revenues for the six months ended June 30,
1999. The substantial increase in depreciation and amortization costs is
attributable to the depreciation related to the expansion of the network
infrastructure. Additionally, the Company experienced an increase in
amortization expense associated with goodwill and intangibles that have arisen
from the 1999 acquisition activities.
Interest, net. Interest for the three months ended June 30, 2000 was $37.9
million as compared to $32.4 million for the comparable period in 1999. The
increase in interest is attributable to the substantial increase in the
Company's outstanding debt obligations since the second quarter of 1999, offset
by the interest earned from short-term investments of the proceeds received from
the Company's financing activities.
Foreign Currency Loss. The Company recognized foreign currency losses of
$28.5 million in the six months ended June 30, 2000 as compared to losses of
$11.4 million in the six months ended June 30, 1999. The foreign currency losses
are primarily attributable to the effect of currency movements on outstanding
debt obligations.
On August 1, 2000, the Board of Directors of GTS formally approved a plan
of restructuring of GTS's business operations. This plan of restructuring is
focused on separating the GTS non-core business from its core strategic
businesses and streamlining operations, including headcount
reductions/redeployment, the centralization of finance and billing operations
and sales office consolidation.
Further, since the Company is a wholly owned subsidiary of GTS, this plan
of restructuring will have an impact on the Company's future financial results.
10
<PAGE> 11
LIQUIDITY AND CAPITAL RESOURCES
CORPORATE
The Company's revenues and costs are dependent upon factors that are not
within its control such as political, economic and regulatory changes, changes
in technology, increased competition and various factors such as strikes,
weather, and performance by third parties in connection with Company operations.
Due to the uncertainty of these factors, actual revenues and costs may vary from
expected amounts, possibly to a material degree, and such variations are likely
to affect the Company's future capital requirements. In addition, if the Company
expands its operations at an accelerated rate or consummate acquisitions, the
Company's funding needs will increase, possibly to a significant degree, and the
Company might expend its capital resources sooner than currently expected. As a
result of the foregoing, or if the Company's capital resources otherwise prove
to be insufficient, the Company might need to raise additional capital to
execute its current business plan and to fund expected operating losses, as well
as to consummate future acquisitions and exploit opportunities to expand and
develop its businesses. The Company is a wholly-owned subsidiary of GTS and
during 1999 and the first half of 2000, GTS contributed $87.5 million and $165.1
million, respectively, in the form of equity contributions. There can be no
assurances, however, that GTS will fund additional amounts in the future.
The Company cannot assure you that it will be able to consummate additional
capital financing on favorable terms. As a result, the Company might be subject
to additional or more restrictive financial covenants and its interest
obligations may increase significantly. Failure to generate sufficient funds in
the future, may require the Company to delay or abandon some or all of its
anticipated expenditures, to sell assets, or both, either of which could have a
material adverse effect on Company operations.
LIQUIDITY ANALYSIS
The Company had cash and cash equivalents of $84.3 million and $16.9
million as of June 30, 2000 and December 31, 1999, respectively. The Company had
restricted cash of $17.2 million and $32.5 million as of June 30, 2000 and
December 31, 1999, respectively, that primarily represent amounts held in escrow
for debt interest payments.
In the six months ended June 30, 2000 the Company used cash of $96.4
million for its operating activities compared to $129.9 million used in the six
months ended June 30, 1999. The Company also used cash of $34.1 million and
generated cash of $16.5 million for its investing activities in the six months
ended June 30, 2000 and 1999, respectively. In the six months ended June 30,
2000, the Company's financing activities generated $148.1 million of cash. The
Company cannot assure you that its operations will achieve or sustain
profitability or positive cash flow in the future. If the Company cannot achieve
and sustain operating profitability or positive cash flow from operations, it
may not be able to meet its debt service obligations or working capital
requirements.
IMPACT OF THE EURO
On January 1, 1999, eleven of the fifteen member countries of the European
Union, including Belgium, The Netherlands, Ireland, France, Germany, Italy and
Spain, where the Company has operations, established fixed conversion rate
between their existing sovereign currencies and a new currency called the
"Euro." These countries adopted the Euro as their common legal currency on that
date. The Euro trades on currency exchanges and is available for non-cash
transactions. Hereafter and until January 1, 2002, the existing sovereign
currencies will remain legal tender in these countries. On January 1, 2002, the
Euro is scheduled to replace the sovereign legal currencies of these countries.
The Company has significant operations within the European Union including
many of the countries that have adopted the Euro. The Company continues to
evaluate the impact the Euro will have on its continuing business operations and
no assurances can be given that the Euro will not have material adverse affect
on business, financial condition and results of operations. However, the Company
does not expect the Euro to have a material effect on its competitive position
as a result of price transparency within the European Union
11
<PAGE> 12
as the Company has always operated as a pan-European business with transparent
pricing in ECU for the majority of the Company's customers.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
There were no significant changes since December 31, 1999.
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
A. Exhibits
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESIGNATION
------- -----------
<C> <S>
27 -- Financial Data Schedule
</TABLE>
B. Reports on Form 8-K
<TABLE>
<CAPTION>
DATE OF REPORT SUBJECT OF REPORT
-------------- -----------------
<C> <S>
None
</TABLE>
12
<PAGE> 13
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrants have duly caused this report to be signed on their behalf by the
undersigned thereunto duly authorized.
GLOBAL TELESYSTEMS (EUROPE) LIMITED
(Registrant)
By: /s/ JEFFREY H. VON DEYLEN
------------------------------------
Name: Jeffrey H. Von Deylen
Title: Senior Vice President,
Finance (Principal Accounting
Officer)
Date: August 11, 2000
13
<PAGE> 14
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESIGNATION
------- -----------
<C> <S>
27 -- Financial Data Schedule
</TABLE>
