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CenturyLink Inc. (CTL) CEO Jeff Storey on Q1 2020 Results - Earnings Call Transcript

May 06, 2020 9:04 PM ETLumen Technologies, Inc. (LUMN)7 Comments
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CenturyLink Inc. (CTL) Q1 2020 Results Conference Call May 6, 2020 5:00 AM ET

Company Participants

Valerie Finberg - VP, IR

Jeff Storey - President and CEO

Neel Dev - EVP and CFO

Conference Call Participants

Tim Horan - Oppenheimer & Company

Batya Levi - UBS

Angela Zhao - Bank of America

Rob Majek - Raymond James

Nick Del Deo - MoffettNathanson

James Ratcliffe - Evercore ISI

Mike McCormack - Guggenheim Partners


Greetings and welcome to CenturyLink’s First Quarter 2020 Earnings Conference Call. During the presentation, all participants will be in a listen-only mode. Afterwards, we will conduct a question-and-answer session. [Operator Instructions] As a reminder, this conference is being recorded today, Wednesday, May 6, 2020.

I would now like to turn the conference over to Valerie Finberg, Vice President, Investor Relations. Please, go ahead.

Valerie Finberg

Thank you, France. Good afternoon, everyone, and thank you for joining us for the CenturyLink first quarter 2020 earnings call. Joining me on the call today are Jeff Storey, President and Chief Executive Officer; and Neel Dev, Executive Vice President and Chief Financial Officer.

Before we begin, I’ll note that all of our earnings materials can be found on the Investor Relations section of the CenturyLink website.

I’ll call your attention to our Safe Harbor statement on slide two of our 1Q ‘20 presentation, which notes that this conference call may include forward-looking statements, subject to certain risks and uncertainties. All forward looking statements should be considered in conjunction with the cautionary statements on slide two in the earnings press release and in the Risk Factors in our SEC filings including the new cautionary statements and risk factors related to COVID-19.

Today, we will be referring to certain non-GAAP financial measures, which are reconciled to the most comparable GAAP measures and can be found

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Comments (7)

The shareholders of CTL that continue to tout the stock are in denial. Another disappointing earnings report. I think CTL should try to sell itself although I know that would be difficult with their debt load-even at today`s distressed prices. CTL has been unable to sell their consumer segment. What company in their right mind would want to buy a business with continuing declining revenue. My guess is that they haven`t received any reasonable offers for this segment.
You equity investors need to ask yourself what has AT&T and Verizon done during the past 5 years? Telecom is not a growth sector. It's a cash business that is great for fixed income investors (bonds/notes). As far as I'm concerned, Q1 was fine given where we are. The fact that CTL is still planning to pay a dividend in 2020 should be astonishing given that so many S&P companies have suspended them. CTL is not Windstream or Frontier despite the stupid analyst on the conference call asking CTL if they intend to buy their assets on the cheap. As CTL deleverages and improves margins, the bond ratings will continue to improve and once their issuer rating goes back to investment grade, the short sellers will move onto other targets.
mpmassey profile picture
Something seems off with the CTL story. It is reducing LTD and gaining traction in its profitable business while letting its low margin business die. So why is the company's value not increasing? It has gone straight down for years now. The LVLT purchase has hurt it if anything. Just stating facts here. I am about to lose my patience with CTL. If they cannot come up with a business plan that works to improve shareholder returns over 5 years, when is it going to reliably grow shareholder value? At this point, the only ones making a profit are the mgmt.
CincinnatiRick profile picture
"I am about to lose my patience with CTL."

So cash in and put the proceeds into something that you think will give you a better return. I'll take your CTL shares.
LASKler profile picture
Overall good performance. CTL is not a growth, but free cash flow story. Long CTL
CincinnatiRick profile picture
Yep...continually paying down debt and very low payout ratio. Methinks those complaining about no growth (or, more precisely, revenue slide as non-profitable sectors are pruned or dying on the vine) are invested in the wrong enterprise. CTL is a value cash cow to be milked, not a growth story. If you want growth, kwitcherbitchen and invest elsewhere.
NOT surprised, but disappointed. I thought the massive changes of the last two months would play to CTL strength (fiber, broadband) - everybody videoconferencing and Zooming. They indicate that network volumes are higher - much higher - that could be great for CTL? Wrong - many customers have UNLIMITED USAGE plans - so higher volumes do NOT bring CTL more revenue. Darn. Maybe more costs to run the network at high volumes, but NOT more revenues.
Before the virus they were embarked on transformation over a three year period - a painfully long period for investors that want investment speed transformational change. Now the transformation has been slowed to GLACIAL SPEED due to the virus. We're on the right track - moving in the right direction - we just need more time, and more time. This is a good company to invest in - if you have a very LOOOONG time horizon before you want to see capital appreciation. Yes - you will see a nice dividend; but stock price appreciation is a long time into the future - and getting longer.
I would rather slog through quicksand than invest more $$$ into CTL.
YES - I believe in the story - FIBER and BROADBAND and DIGITAL everything - but every quarter it seems like a vision farther in the distance. We never get there.
Other than that - everything is fine. Good luck to frustrated CTL longs.
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