Level 3 reports narrower loss, improved outlook

Level 3 Communications’ cost cutting paid off with a sharply narrower loss for the first quarter, bringing the carrier cash flow positive for the first time. It reported a net loss of $90 million, or 23 cents a share, compared with last year’s first-quarter loss of $535 million. The loss, however, includes gains from debt repurchases and tax refunds. Without the one-time items, the carrier’s loss was $339 million.

Level 3 executives said that the worst was over for the struggling carrier and projected cash flows of $400 million and capital of expenditures of $225 million for the year. For the second quarter, Level 3 is forecasting a loss of 70 cents a share off $60 million in cash flow and communications revenue of $270 million.

“There continues to be some uncertainty regarding the timing and effect of the economic recovery on both the communications service sector and on enterprise information technology budgets,” CEO James Crowe said in a statement released today. “We believe, however, that Level 3 is well positioned to benefit from the inevitable recovery. In the meantime, we remain focused on managing cash flow and preserving our strong liquidity position.”