January 2005 Level 3 Communications recently announced it will expand services into the Czech Republic, providing wholesale high-speed Internet access service intended for ISPs, cable providers, and international carriers selling communications services to Prague-based enterprises. Despite this expansion, Level 3 also recently announced layoffs of 500 to 600 employees.
The reduction, which is expected to result in operational savings of approximately $60 million to $70 million per year, will take place before the end of January 2005.
The third-quarter financials showed revenue of $840 million, an operating loss of $51 million and a net loss of $171 million. Level 3 is nearly $5 billion in debt and needs to push into new markets to develop new revenue streams. Level 3 senior staff, however, remain upbeat.
We remain pleased with the volume of sales weve seen in recent quarters related to IP, transport, voice and other strategic services, and we continue to invest in areas where we see growing opportunities, said James Q. Crowe, Level 3s chief executive officer.
The Czech Republic is one of the fastest growing telecommunications markets in Eastern Europe, said Brady Rafuse, president of Level 3s European operations. We believe the addition of Prague as a market in service will significantly enhance Level 3s European network footprint, and we look forward to serving our growing base of customers there.
The company's stock closed at $2.93 Wednesday, up 3 cents. That's off from its 2004 high of $7.40 last January.
Level 3s fibre optic network spans 23,000 miles and operates metropolitan networks in 36 cities, including London, Paris, Amsterdam, Brussels, Düsseldorf, Hamburg, Berlin, Munich and Frankfurt.
With large holdings and plans to expand offsetting a net loss for the last quarter and a sizeable debt Level 3s financial future remains to be seen.