SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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): September 23, 2003
Level 3 Communications, Inc.
(Exact name of Registrant as specified in its charter)
Delaware 47-0210602
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1025 Eldorado Blvd., Broomfield, Colorado 80021
(Address of principal executive offices) Zip code)
720-888-1000
(Registrant's telephone number including area code)
Not applicable
(Former name and former address, if changed since last report)
Item 7. Financial Statements and Exhibits
(a) Financial Statements of business acquired
None
(b) Pro forma financial information
None
(c) Exhibits
None
Item 9. Regulation FD Disclosure
On September 23, 2003, the Company made the following simple calculations
of various financial metrics available. This information is based on the
following assumptions, and is not intended as a projection of management's view
of the Company's expected performance during the periods indicated. The
assumptions are presented to allow the reader to understand the components of
the calculations that are summarized in the table of financial metrics
presented. The following is intended as a simplified credit scenario for
consideration by the reader, who is cautioned to evaluate the assumptions used.
The furnishing of this information shall not be deemed an admission as to the
materiality of the information included in this Current Report. This information
is not filed but is furnished pursuant to Regulation FD.
Assumptions used in the following calculation are for illustrative purposes only
and are not a projection of expected performance:
Revenue growth of 10% a year
Incremental EBITDA margin of 65%
Base capital expenditures of $100 million a year
Incremental Capital expenditures of $0.45 for every incremental $1.00 of revenue
The Company's Information Services business generates $30 million of unlevered
cash flow a year
The Companys annual cash need for working capital equals $20 million
Minimum cash balance is $500 million and excess cash is used to repay
outstanding debt
The foregoing assumptions will cause the following results for the future
periods indicated:
2004 2005 2006 2007 2008
Revenue $1.89B $2.08B $2.29B $2.52B $2.77B
EBITDA $585M $705M $840M $990M $1.15B
EBITDA Margin 31% 34% 37% 39% 42%
CapEx $180M $190M $195M $200M $210M
ISG Unlevered Cash Flow $30M $30M $30M $30M $30M
Working Capital $(20M) $(20M) $(20M) $(20M) $(20M)
Unlevered Cash Flow $420M $525M $655M $800M $950M
Net Cash Interest $(410M) $(425M) $(440M) $(420M) $(330M)
Free Cash Flow $10M $100M $215M $380M $620M
Debt $5.0B $4.9B $4.8B $4.5B $3.9B
Debt/EBITDA 8.6x 7.0x 5.7x 4.5x 3.4x
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.
Level 3 Communications, Inc.
September 23, 2003 By: /s/ Neil J. Eckstein
Date Neil J. Eckstein, Senior Vice President