Global Telesystems Group, Inc. (NYSE: GTS) posted a smaller loss than Wall Street had predicted Monday and will restructure to focus on broadband and Internet services.
Shares of the European e-business and broadband telecom services provider slipped over 19 percent, down 0.63 to 2.63.
For the third quarter, GTS came in with a loss of $9.5 million, before interest, taxes, depreciation and amortization, or 82 cents a share. First Call had expected a loss of 85 cents a share. Sequentially, this was an improvement over the EBITDA (earnings before interest, tax, depreciation and amortization).loss of $16.3 million, or 77 cents a share, registered in the second quarter. Loss per share for the third quarter 1999 was 59 cents a share.
Total revenue for the quarter was $259.8 million. Core revenue in the quarter grew to $230.2 million, up 7.1 percent sequentially from the $222.0 million recorded in the second quarter. Broadband services revenue grew 29.6 percent year-over-year to $113.6 million, up 5.9 percent sequentially. Drives data/IP revenue rose 17 percent sequentially.
Following the recent pattern of other large telecom companies, GTS also announced that it will restructure. The company will divide into four divisions - GTS Broadband Services, Russia's Golden Telecom, GTS Business Services and GTS Central Europe. It will then sell off the two latter divisions and invest the proceeds into broadband.
GTS made news recently by selling its 50 percent stake in FLAG Atlantic Limited to FLAG Telecom for $175 million.