SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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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): July 8, 1998
QWEST COMMUNICATIONS INTERNATIONAL INC.
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(Exact name of registrant as specified in its charter)
DELAWARE
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(State or other jurisdiction of incorporation)
000-22609 84-1339282
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(Commission File Number) (IRS Employer Identification No.)
1000 QWEST TOWER, 555 SEVENTEENTH STREET DENVER, COLORADO 80202
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 303-291-1400
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NOT APPLICABLE
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(Former name or former address, if changed since last report)
<PAGE>
ITEM 5. OTHER EVENTS
The Registrant issued the press release attached as Exhibit 99.1 to this
Current Report on Form 8-K on July 8, 1998.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
Exhibit 99.1 Press release of the Registrant dated July 8, 1998.
<PAGE>
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 thereunto duly authorized.
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QWEST COMMUNICATIONS INTERNATIONAL INC.
DATE: July 8, 1998 By: /s/ ROBERT S. WOODRUFF
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Robert S. Woodruff
Executive Vice President - Finance,
Chief Financial Officer and
Treasurer
Exhibit 99.1 Press release of the Registrant dated July 8, 1998.
Corporate Contact: Investor Contact: Media Contact:
Qwest Communications Qwest Communications Alexander Communications
Diane Reberger Lee Wolfe Alison Schwartz
(303) 992-1662 (800) 567-7296 (303) 615-5070 x128
[email protected] [email protected] [email protected]
http://www.qwest.net http://www.qwest.net http://www.alexander-pr.com
QWEST HOSTS FIRST MAJOR INVESTMENT COMMUNITY MEETING
Second Quarter Results in Line with Analysts' Expectations;
Merger Synergies Improved and Purchase Accounting Amounts Determined
DENVER, July 8, 1998 - Qwest Communications International, Inc. is hosting its
first major investment community meeting today in New York City. Qwest's
strategic direction, operational plans and status of integration activities
related to the merger with LCI International will be the primary areas of focus
at the meeting. In addition, the company will announce it anticipates that
second quarter earnings will meet analysts' expectations.
"It has been a year since Qwest had its initial public offering, and we are
looking forward to updating and informing the financial community on the
exciting progress of the company," said Robert S. Woodruff, executive vice
president, Finance and CFO of Qwest. "Our business plan is on track, the
integration of LCI is proceeding well, and we expect to comfortably meet
analysts' expectations for the second quarter."
Qwest expects to report second quarter revenues of approximately $370 million
and earnings before interest, taxes, depreciation and amortization (EBITDA) of
approximately $17 million, based on applying purchase accounting, which Qwest
believes to generally be in line with the expectations of financial analysts.
Under purchase accounting, the second quarter results will reflect the full
three months of Qwest operations and one month of LCI operations. The final
quarterly results are expected to be released July 27, 1998.
Synergies from the merger with LCI International are expected to be better than
earlier projections. Qwest previously estimated cumulative 1998 through 2001
revenue synergies of $227 million, $1.16 billion of cost synergies, and $288
million in capital synergies. Today, Qwest will report revenue synergies are now
estimated to exceed $300 million, resulting in EBITDA benefits in excess of $105
million; cost synergies are in line with previous estimates; and capital
synergies are now expected to exceed $600 million. Of these cumulative
synergies, $75 million of operating synergies (revenue contribution and cost
savings) and $70 million of capital synergies are expected to be reflected in
1998 results.
The LCI merger, which closed on June 5, 1998, is being accounted for using
purchase accounting and will reflect a purchased research and development (R&D)
write-off in the range of $800 to $850 million in the second quarter, including
a charge for purchased R&D for EUnet International, a leading European data
company. The EUnet acquisition closed on April 14, 1998. Additionally, up to $50
million of other one-time merger-related charges will be booked in the quarter
bringing total one-time charges for the second quarter related to acquisitions
to $850 to $900 million. As a result of the four acquisitions that have closed
through the second quarter of 1998, Qwest will amortize $250 million in
developed technology over 10 years and $3.5 to $3.6 billion in goodwill over
approximately 40 years.
The Qwest Macro Capacity Fiber Network
Qwest's planned domestic 18,449 mile network will serve over 130 cities, which
represent approximately 80 percent of the data and voice traffic originating in
the United States, upon its scheduled completion in the second quarter of 1999.
To date, approximately 8,800 miles of the Qwest Macro Capacity Fiber Network are
activated, including the transcontinental segment that extends from Los Angeles
to Sacramento and across to New York. Qwest is also extending its network 1,400
miles into Mexico with completion slated for late 1998 and has transatlantic
capacity to serve Europe.
The Qwest Macro Capacity Fiber network is designed with a highly reliable and
secure bi-directional, line switching OC-192 SONET ring architecture. Upon
completion, the network will offer a self-healing system that provides the
ultimate security and reliability by allowing instantaneous rerouting in the
event of a fiber cut.
About Qwest
Qwest Communications International Inc. (NASDAQ: QWST) is a multimedia
communications company and one of the fastest growing companies in America
today. Headquartered in Denver, Colorado, Qwest has approximately 6,000
employees and over 80 sales offices worldwide. With its world-class data and
multimedia network, marketing expertise, and customer care and billing systems,
Qwest is delivering high-quality data, video and voice connectivity securely and
reliably to customers around the world. Further information is available at
www.qwest.net.
# # #
This release contains or refers to forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934 that include, among others, (i) statements by Qwest
concerning the benefits expected to result from certain transactions, including,
without limitation, synergies in the form of increased revenues, decreased
expenses and avoided expenses and expenditures that are expected to be realized
by Qwest after the closing of such transactions, (ii) Qwest's plans to complete
the Qwest Macro Capacity Fiber Network and (iii) other statements by Qwest of
expectations, beliefs, future plans and strategies, anticipated developments and
other matters that are not historical facts. Qwest cautions the reader that
these forward-looking statements are subject to risks and uncertainties,
including financial, regulatory environment, and trend projections, that could
cause actual events or results to differ materially from those expressed or
implied by the statements. Such risks and uncertainties include those risks,
uncertainties and risk factors identified, among other places, in documents
filed with Securities and Exchange Commission. The most important factors that
could prevent Qwest from achieving its stated goals include, but are not limited
to, (a) failure by Qwest to manage effectively, cost efficiently and on a timely
basis the construction of the Qwest Network route segments, (b) failure by Qwest
to enter into additional customer contracts to sell dark fiber or provide
high-volume capacity and otherwise expand its telecommunications customer base
on the Qwest Network, (c) failure by Qwest to obtain and maintain all necessary
rights-of-way, (d) intense competition in Qwest's carrier services and
commercial services markets, (e) the potential for rapid and significant changes
in technology and their effect on Qwest's operations, (f) operating and
financial risks related to managing rapid growth and integrating acquired
businesses, (g) adverse changes in the regulatory environment, and (h) failure
by Qwest to integrate the respective operations of Qwest and certain acquired
businesses or to achieve the synergies expected from certain transactions. These
cautionary statements should be considered in connection with any subsequent
written or oral forward-looking statements that may be issued by Qwest or
persons acting on its behalf. Qwest undertakes no obligation to review or
confirm analysts' expectations or estimates or to release publicly any revisions
to any forward-looking statements to reflect events or circumstances after the
date hereof or to reflect the occurrence of unanticipated events.
The Qwest logo is a registered trademark of Qwest Communications International
Inc. in the U.S. and certain other countries.
