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CenturyLink “significant progress” in 2018

February 14, 2019

CenturyLink, the US telco, has reported results for the fourth quarter and full year December 31, 2018.

“CenturyLink’s focus on disciplined execution in 2018 enabled us to make significant progress integrating Level 3, including achieving our originally announced synergy target more than two years earlier than expected,” said Jeff Storey, president and CEO of CenturyLink. “In 2019, we are shifting our focus from integration to transformation.  We are focused on profitable revenue growth in our business markets and believe the scope and scale of our global assets, along with our innovative product portfolio, position us to succeed.

“In addition to this focus on growth, we are shifting our capital allocation priorities and reducing the annual dividend to $1.00 from the current $2.16.  Strong business fundamentals allow us to make the important decision to lower our leverage target to 2.75x to 3.25x Net Debt to Adjusted EBITDA and accelerate our timeframe to reach that target, while still returning significant cash to shareholders and continuing to invest in revenue and EBITDA growth initiatives,” Storey concluded

Total revenue was $5.78 billion for the fourth quarter 2018, compared to $6.01 billion for the fourth quarter 2017 on a pro forma basis.

“Looking to 2019, we expect to continue to grow Adjusted EBITDA and expand Adjusted EBITDA margins,” said Neel Dev, CenturyLink’s executive vice president and chief financial officer.  “From a starting point of $8.94 billion, which excludes approximately $100 million of Adjusted EBITDA associated with the new lease accounting standard, we expect Adjusted EBITDA to grow to $9 to $9.2 billion for the full year 2019.  “Beyond the $850 million of acquisition-related synergies we have already captured, we expect to realise an additional $800 million to $1 billion of run-rate Adjusted EBITDA synergies and transformation savings over the next three years. We expect to incur $450 to $650 million in one-time costs to achieve these savings.”

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