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Global Crossing Ltd. (GLBC) Message Board

  • richkimjd richkimjd Feb 14, 2005 9:46 AM Flag

    merger mania

    portends interest in GLBC's network and business and upward movement of share price from these levels.

    ATT + SBC, MCI + Verison, Sprint + Nextel, GLBC + ?, Q + ?. ect...

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    • Mr. 8888,

      I commend you for your spirit. This makes Carlos "not-so" Slim grin. He simply doffs his cap to you. Keep the juices flowing.

    • >>> u try, and u try, with little impact. yukos is a dumb shit and lets leave it at that. <<<

      Everyone's got to have a hobby.

      toes

    • u try, and u try, with little impact. yukos is a dumb shit and lets leave it at that.

    • So many misrepresentations.

      The company no longer has $2.6B in revs. They are forecasting less than 600M this quarter and for that to keep dropping as they exit or reduce certain products and markets. You're at $2.0-2.4B at best now, probably on the lower end.

      >>> and incremental capex only required if demand justifies <<<

      That's not how this business works. There is a minimum level of maintenance capex to keep any network running by replacing broken equipment and increasing unit capacity to replace revenue lost to price declines. GLBC spent $100M last year on exactly this - and compared with the rest of the industry, they spent as little as humanly possible in order to save cash.

      >>> The international network is virtually empty in utilisation terms and huge capacity can be sold on this network for zero incremental cost implying that ebitda can be boosted substantially when intercontinental capacity demand increases. <<<

      I hate to tell you this, but the international, undersea bandwidth market is moribund, and is not currently recovering. Maybe in a few years, but not right now. Right now the money is in the metro - a game where GLBC doesn't even play.

      toes

    • They have to pay very little interest and require very little capex. The have substantial revenues (2.6 billion) and improve ebitda by $26m every time they improve margins by 100 basis points. The international network is virtually empty in utilisation terms and huge capacity can be sold on this network for zero incremental cost implying that ebitda can be boosted substantially when intercontinental capacity demand increases. With an interest bill of c. $30m and incremental capex only required if demand justifies the company could be cash flow positive if margins improved by 300 basis points in total i.e. gross margin increased by $75m.
      The company is cheap, well positioned, fully financed and on the cusp of major success

    • >>> Yes but it's PEANUTS compared to the debt load facing many other players in the sector <<<

      And who disputed that? :-)

      >>> GLBC is also very close to being Ebitda positive <<<

      That was funny! I know, I know, if they could just cut their access costs as a percentage of revenue by 10%... And if ezgen could sprout wings and fly to mars - that might help too. But good luck rooting for it.

      toes

    • There's a great Jewish expression for that:

      If my Zaidy (grandfather) had breasts, he would be my Bubby (grandmother).

      EBITDA is a meaningless calulation for a company with interest payments and ongoing capital expenditures. Now IF they did not have to pay interest or spend on capital expenditures...

    • Yes but it's PEANUTS compared to the debt load facing many other players in the sector including Qwest and LVLT.
      GLBC is also very close to being Ebitda positive

    • Dude, until they convert, it's debt. It's not out in limbo some place - and it isn't shares right now. It pays interest and it has covenants, and they can default on them. It's debt - and because it's debt it's senior to your common shares if they do go BK someday.

      toes

    • >>> The $400m secured against the UK business also resulted in almost $400m of cash being raised so that did not significantly increase net debt. <<<

      That sentence amazes me. Raising money doesn't increase net debt - obviously. The problem comes when you SPEND ALL THE MONEY you raised. Then your net debt goes up.

      Cash burn.

      Cash burn.

      Sometimes I think the longs on this board believe that cash burn makes no difference to anything at all.

      toes

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