Global Crossing Reports GCUK's Third Quarter Results

By Global Crossing Limited, PRNE
Monday, December 13, 2010

LONDON, December 14, 2010 - Global Crossing Limited (Nasdaq: GLBC), a leading global IP solutions
provider, today announced third quarter results for its subsidiary, Global
Crossing (UK) Telecommunications Limited (GCUK).


For the third quarter of 2010, GCUK generated revenue of 75 million
pounds and Operating Income Before Depreciation and Amortization (OIBDA) of
16 million pounds. (OIBDA is a non-GAAP measure defined and reconciled
below.) The company also reported net cash provided by operations of 10
million pounds.

"The UK business continues to be an important contributor to our global
strategy to offer advanced IP, Ethernet and data center services to customers
with multi-regional requirements," said John Legere, chief executive officer
of Global Crossing. "We are gaining traction in our efforts to expand and
diversify our base of commercial enterprise customers while broadening our
valuable market position with UK government customers."

Third Quarter Results

GCUK generated revenue of 75 million pounds, a sequential decrease of 3
percent and a year-over-year increase of 1 percent. The sequential decrease
was primarily due to lower sales related to short-interval demand, such as
purchases of equipment and professional services, and somewhat higher sales
credits after lower than average sales credits in the prior quarter. The
year-over-year increase was primarily due to increased sales to enterprise

Gross profit was 28 million pounds for the quarter, a sequential decrease
of less than 1 million pounds and a year-over-year decrease of 1 million
pounds. The year-over-year decrease was due to a 4 million pound favorable
regulatory ruling in the year-ago period, mostly offset by sales growth and
lower depreciation and amortization.

GCUK's OIBDA for the third quarter was 16 million pounds, compared with
15 million pounds in the second quarter of 2010 and 20 million pounds in the
third quarter of 2009. The sequential increase was principally driven by a
reduction in accrued incentive compensation and sales commissions. The
year-over-year decrease was primarily due to the previously mentioned
favorable regulatory ruling in the year-ago period and higher real estate
restructuring costs, partially offset by sales growth.

GCUK recorded a net profit of 3 million pounds for the third quarter,
compared with a net loss of 3 million pounds in the second quarter of 2010
and a net loss of 2 million pounds in the third quarter of 2009. The
sequential and year-over-year increase in net profit was primarily due to
favorable foreign exchange impacts on net U.S. dollar-denominated debt in the
third quarter of 2010 compared with unfavorable foreign exchange impacts in
the prior quarter and prior year.

Cash and Liquidity

As of September 30, 2010, GCUK had cash and cash equivalents of 42
million pounds, compared with 38 million pounds on June 30, 2010, and 26
million pounds on September 30, 2009.

GCUK's cash and cash equivalents increased 4 million pounds in the third
quarter. Net cash provided by operating activities during the third quarter
totaled 10 million pounds, after 7 million pounds of cash used by operating
working capital. During the quarter, GCUK recorded purchases of property,
plant and equipment of 4 million pounds and principal payments on finance
leases and other debt of 2 million pounds.

International Financial Reporting Standards

GCUK's results reported here include unaudited consolidated financial
results for the three months ended September 30, 2009, June 30, 2010 and
September 30, 2010; the unaudited consolidated balance sheet as of September
30, 2010
; and the audited consolidated balance sheet as of December 31, 2009,
all in accordance with IFRS and in pounds sterling, as published by the
International Accounting Standards Board (IASB). GCUK's results for the third
quarters of 2010 and 2009 and the second quarter of 2010 were included in
Global Crossing's consolidated results previously reported on November 1,
, in accordance with U.S. GAAP and in U.S. dollars.

Non-GAAP Financial Measures

Consistent with the U.S. Securities and Exchange Commission's (SEC's)
Regulation G, the attached tables include a definition of OIBDA, as well as a
reconciliation of such measure to the most directly comparable financial
measure calculated in accordance with IFRS.

Conference Call

Management has scheduled a conference call for Tuesday, December 14,
, at 9:00 a.m. EST/2:00 p.m. GMT to discuss GCUK's financial results. The
call may be accessed by dialing +1-212-231-2905 or +44-(0)-20-8196-2883.
Callers are advised to dial in 15 minutes prior to the 9:00 a.m. EST start
time. The call will also be Webcast at

A replay of the call will be available on Tuesday, December 14, 2010,
beginning at 11:00 a.m. EST/4:00 p.m. GMT and will be accessible until
Tuesday, December 21, 2010, at 11:00 a.m. EST/4:00 p.m. GMT. To access the
replay, dial +1-402-977-9140 or +1-800-633-8284 and enter reservation number
21489357. UK callers may access the replay by dialing +44-(0)-87-0000-3081
Or (0)-80-0692-0831 and entering reservation number 21489357.


Global Crossing (UK) Telecommunications Limited ("GCUK") provides a full
range of managed telecommunications services in a secure environment ideally
suited for IP-based business applications. The company provides managed
voice, data, security, Internet transport, and collaboration solutions to a
strong and established customer base, including more than 100 UK government
departments, as well as systems integrators, rail sector customers, and major
corporate clients. In addition, GCUK provides carrier services to national
and international communications service providers.


Global Crossing (NASDAQ: GLBC) is a leading global IP and Ethernet
solutions provider with the world's first integrated global IP-based network.
The company offers a full range of data, voice and collaboration services
with an industry leading customer experience and delivers service to
approximately 40 percent of the Fortune 500, as well as to 700 carriers,
mobile operators and ISPs. It delivers converged IP services to more than 700
cities in more than 70 countries around the world.

Website Access to Company Information

Global Crossing maintains a corporate website at,
and you can find additional information about the company through the
Investors pages on that website at
Global Crossing utilizes its website as a channel of distribution of
important information about the company. Global Crossing routinely posts
financial and other important information regarding the company and its
business, financial condition and operations on the Investors web pages.

Visitors to the Investors web pages can view and print copies of Global
Crossing's SEC filings, including periodic and current reports on Forms 10-K,
10-Q, 8-K, and in respect of GCUK's Forms 20-F and 6-K, as soon as reasonably
practicable after those filings are made with the SEC. Copies of the charters
for each of the standing committees of Global Crossing's Board of Directors,
its Corporate Governance Guidelines, Ethics Policy, press releases and
analysts presentations are all available through the Investors web pages.

Please note that the information contained on any of Global Crossing's
websites is not incorporated by reference in, or considered to be a part of,
any document unless expressly incorporated by reference therein.

This press release contains statements about expected future events and
financial results that are forward-looking and subject to risks and
uncertainties that could cause the actual results to differ materially,
including: the impact on the business of current global economic conditions
and the tightening in global credit markets; increased competition and
pricing pressures resulting from technology advances and regulatory changes;
competitive disadvantages relative to competitors with superior resources;
the impact on the business of the tightening of budgets by UK government
agencies, including significant customers of GCUK; dependence on a number of
key personnel; the concentration of revenue in a limited number of customers,
and the rights of such customers to terminate their contracts or to simply
cease purchasing services thereunder; the influence of the company's parent,
and possible conflicts of interest of the parent or of certain of GCUK's
directors and officers; our ability to raise capital through financing
activities in an amount sufficient to pay our indebtedness and to fund our
other liquidity needs; exposure to contingent liabilities; and other risks
referenced from time to time in GCUK's filings with the Securities and
Exchange Commission. Global Crossing undertakes no duty to update information
contained in this press release or in other public disclosures at any time.


    Press Contact
    Michael Schneider

    Analysts/Investors Contacts
    Mark Gottlieb

    Gino Mathew
    United Kingdom


                      6 Schedules to Follow

    Schedule 1: Consolidated Statements of Financial Position
    Schedule 2: Consolidated Statements of Operations
    Schedule 3: Consolidated Statements of Cash Flows
    Schedule 4: Summary of Consolidated Revenues
    Schedule 5: Supplemental Information provided pursuant to the
                indenture governing the GCUK senior secured notes
    Schedule 6: Reconciliation of OIBDA to Net Profit/LOSS

    Global Crossing (UK) Telecommunications Limited         Schedule 1
      and Subsidiaries
    Consolidated Statements of Financial Position
    Results below are in pounds sterling in thousands

                                                September    December
                                                 30, 2010    31, 2009
                                                 --------    --------

    Non-current assets
        Intangible assets, net                     11,474      11,417
        Property, plant and equipment, net        145,767     157,526
        Investment in associate                       218         210
        Retirement benefit asset                      468         468
        Trade and other receivables                33,382      33,230

                                                  191,309     202,851
                                                  -------     -------
    Current assets
        Trade and other receivables                68,029      58,125
        Cash and cash equivalents                  42,180      37,331
                                                  -------     -------
                                                  110,209      95,456
                                                  -------     -------
    Total assets                                  301,518     298,307
                                                  =======     =======

    Current liabilities
        Trade and other payables                  (81,501)    (81,085)
        Senior secured notes                       (5,909)    (11,819)
        Deferred revenue                          (41,107)    (37,313)
        Provisions                                 (2,010)     (1,281)
        Obligations under finance leases           (7,001)     (7,310)
        Other debt obligations                        (35)       (285)
                                                  -------     -------
                                                 (137,563)   (139,093)
                                                 --------    --------

    Non-current liabilities
        Trade and other payables                  (22,638)    (10,830)
        Senior secured notes                     (264,269)   (255,496)
        Deferred revenue                          (82,440)    (90,326)
        Retirement benefit obligation              (1,763)     (2,551)
        Provisions                                 (2,126)     (2,211)
        Obligations under finance leases           (9,081)    (12,262)
        Other debt obligations                          -          (9)
                                                  -------     -------
                                                 (382,317)   (373,685)
                                                  -------     -------
    Total liabilities                            (519,880)   (512,778)
                                                  -------     -------
    Net liabilities                              (218,362)   (214,471)
                                                 ========    ========

    Capital and reserves
        Equity share capital (101,000 shares
         outstanding at BPS1 each)                    101         101
        Capital reserve                            32,397      31,271
        Accumulated deficit                      (250,860)   (245,843)
                                                  -------     -------
    Total equity                                 (218,362)   (214,471)
                                                 ========    ========
    Global Crossing (UK) Telecommunications Limited            Schedule 2
     and Subsidiaries
    Consolidated Statements of Operations
    Results below are in pounds sterling in thousands

                                               Three months ended
                                     September        June          September
                                     30, 2010       30, 2010        30, 2009
                                   ----------      ---------       ----------
                                   (unaudited)    (unaudited)     (unaudited)

    Revenue                            75,331         77,994          74,841
    Cost of sales                     (47,021)       (49,317)        (45,257)
                                       ------         ------          ------
    Gross profit                       28,310         28,677          29,584
    Distribution costs                 (5,745)        (6,334)         (4,775)
    Administrative expenses           (16,269)       (17,316)        (15,666)
                                       ------         ------          ------
    Operating profit                    6,296          5,027           9,143
    Finance revenue                     1,139          1,161           1,510
    Finance charges                    (9,142)        (9,385)         (8,557)
    Net foreign exchange gain/
     (loss) on foreign currency
     borrowings, net                    5,039           (220)         (3,576)
                                       ------         ------          ------
    Profit/(loss) before tax            3,332         (3,417)         (1,480)
    Tax charge                            (63)            (5)            (89)
                                       ------         ------          ------
    Profit/(loss)  for the period       3,269         (3,422)         (1,569)
                                        =====         ======          ======

    Global Crossing (UK) Telecommunications Limited            Schedule 3
     and Subsidiaries
    Consolidated Statements of Cash Flows
    Results below are in pounds sterling in thousands

                                                        Nine months ended
                                                     September     September
                                                     ---------     ---------
                                                      30, 2010      30, 2009
                                                      --------      --------
                                                    (unaudited)   (unaudited)
    Operating activities
    (Loss)/profit for the period                        (5,017)        6,230
    Adjustments for:
    Finance costs, net                                  25,873        11,552
    Income tax charges                                     215           449
    Depreciation of property, plant and equipment       25,662        26,308
    Amortization of intangible assets                    1,634         1,308
    Amortization of prepaid connection costs             4,979         6,774
    Share based payment expense                            338           711
    Loss/(gain) on disposal of property, plant
     and equipment                                         574           (19)
    Equity income for associate                             (8)          (32)
    Change in long term deferred revenue                (7,886)       (9,207)
    Change in long term other assets and
     liabilities                                          (531)       (1,358)
    Change in operating working capital:
    Change in trade accounts receivable and
     accrued income                                     (8,858)        3,000
    Change in trade accounts payable and accrued
     cost of access                                     (2,532)       (8,805)
    Change in other receivables current                 (8,585)      (18,983)
    Change in other payables current                    (1,892)        3,128
                                                        ------        ------
    Cash generated from operations                      23,966        21,056
    Interest paid                                      (18,195)      (16,875)
                                                        ------        ------
    Net cash provided by operating activities            5,771         4,181
                                                        ------        ------

    Investing activities
    Interest received                                    6,112         2,244
    Proceeds from disposal of property, plant and
     equipment                                               -            58
    Purchase of property, plant and equipment          (13,919)       (9,301)
                                                       -------        ------
    Net cash used in investing activities               (7,807)       (6,999)
                                                        ------        ------

    Financing activities
    Loans provided by group companies                   13,100         9,908
    Repayment of senior secured notes                     (221)       (7,382)
    Repayment of employee taxes on share-based
     payments                                                -        (1,047)
    Repayments of capital elements under finance
     leases                                             (5,736)       (7,913)
    Repayment of capital element of other debt
     obligations                                          (258)         (544)
                                                        ------        ------
    Net cash provided by/(used in) financing
     activities                                          6,885        (6,978)
                                                        ------        ------
    Net increase/(decrease) in cash and cash
     equivalents                                         4,849        (9,796)
    Cash and cash equivalents at beginning of
     period                                             37,331        36,100
                                                        ------        ------
    Cash and cash equivalents at end of period          42,180        26,304
                                                        ======        ======
    Non-cash investing activities:
    Capital lease and debt obligations incurred          2,248         2,311
                                                         =====         =====
    Global Crossing (UK) Telecommunications Limited            Schedule 4
     and Subsidiaries
    Summary of Consolidated Revenues
    Results below are in pounds sterling in thousands

                                                   Three months ended
                                           September     June      September
                                           ---------   ---------   ---------
                                            30, 2010    30, 2010    30, 2009
                                            --------    --------    --------
                                          (unaudited) (unaudited) (unaudited)
      Enterprise, carrier data and
       indirect sales channels                74,590      76,938     73,379
      Carrier voice                              633         931      1,337
                                                 ---         ---      -----
      Revenues from third party customers     75,223      77,869     74,716
      Revenues from Global Crossing group
       companies                                 108         125        125
                                                 ---         ---        ---
      Consolidated revenues                   75,331      77,994     74,841
                                              ======      ======     ======

                                                               Schedule 5


GCUK is required to provide the holders of its Senior Secured Notes due
2014 with quarterly information pursuant to Section 4.17(a)(2) of the
indenture governing such notes. For quarters prior to the first quarter of
2010, GCUK satisfied this requirement by providing the note holders with a
quarterly report separate and apart from its quarterly earnings press
releases. Starting with the first quarter of 2010, GCUK has satisfied this
requirement by providing the note holders with its quarterly earnings press
releases. This schedule of supplemental information is being included with
the earnings press release to ensure that the information being provided
complies with Section 4.17(a)(2) of the indenture.

Liquidity and Capital Resources

GCUK's ability to make payments on and to refinance its indebtedness and
to fund planned capital expenditures will depend on its ability to generate
cash in the future. This depends to a degree on general economic, financial,
competitive, legislative, regulatory and other factors that are beyond GCUK's

GCUK monitors its capital structure on an ongoing basis and from time to
time considers financing and refinancing options to improve its capital
structure and to enhance its financial flexibility. GCUK's ability to enter
into new financing arrangements is subject to restrictions in its outstanding
debt instruments. At any given time GCUK may pursue a variety of financing
opportunities, and its decision to proceed with any financing will depend,
among other things, on prevailing market conditions, near term maturities and
available terms. In addition, from time to time GCUK reviews its operations
and may consider opportunities to strategically enhance, expand or change its
operations and leverage its capabilities. If GCUK pursues any such
opportunities, it may require additional equity or debt financing, and there
can be no assurance that it will be able to obtain such financing on
favorable terms or at all. Undertaking any such initiatives may place greater
demands on GCUK's cash flows due to increased capital and operating expenses
and debt service.

At September 30, 2010, GCUKs available liquidity consisted of 42.2
million pounds of unrestricted cash and cash equivalents.

In the long term, GCUK expects its operating results and cash flows to
improve as a result of growth of its revenues, including the economies of
scale expected to result from such growth, and from ongoing cost management
initiatives, including initiatives to optimize the access network and
effectively lower unit prices. Thus, in the long term, GCUK expects to
generate positive cash flow from operating activities in an amount sufficient
to fund all investing and financing requirements, subject to the need to
refinance the GCUK Senior Secured Notes. However, its ability to improve cash
flows is subject to the risks and uncertainties, such as the variability of
quarterly cash flows, discussed below.

In the short term, GCUK expects cash provided by operating activities to
exceed purchases of property and equipment. This expectation is based in part
on the raising of financing for certain property and equipment from vendors
and other third parties. Its ability to arrange such financings is subject to
negotiating acceptable terms from equipment vendors and financing parties. In
addition, GCUK's short term liquidity and more specifically its quarterly
cash flows are subject to considerable variability as a result of the timing
of interest payments as well as the following factors.

    - Working capital variability significantly impacts its cash flows and
      can cause its intra-quarter cash balances to drop to levels
      significantly lower than those levels prevailing at the end of a
    - Adverse general economic conditions could cause customer buying
      patterns with GCUK to change as a result of their cash conservation
      efforts, which could have an adverse impact on its cash flows. Such
      adverse conditions could also adversely impact its working capital to
      the extent suppliers seek more timely payment from GCUK or customers
      pay GCUK on a less timely basis.
    - The UK government has announced austerity measures aimed at reducing
      costs in a wide range of areas, including telecommunications. The
      implementation of pricing actions and the reduction of spending by
      governmental entities could have a negative effect on GCUK's future
      revenue performance.
    - Within 120 days after each calendar year, GCUK must offer to purchase a
      portion of the Senior Secured Notes at 100% of their principal amount
      using 50% of the Operating Cash Flow (as defined in the Indenture) for
      that year. In respect of 2009, it offered to purchase 11.8 million
      pounds of the Notes, excluding accrued interest and purchased 0.2
      million pounds of the Notes, plus accrued interest through the purchase
      date. If the current year to date results were the results for the full
      year to December 31, 2010, the Company would be obliged to make an
      Annual Repurchase Offer of approximately 5.9 million pounds , exclusive
      of accrued but unpaid interest. GCUK's Senior Secured Notes (less any
      amounts purchased as a result of any excess cash offer) mature in 2014.
      If cash on hand at the time these debt instruments mature is
      insufficient to satisfy these and GCUK's other debt repayment
      obligations, GCUK could need to access the capital markets to meet its
      liquidity requirements. Such access would depend on market conditions
      and its credit profile at the time.
    - GCUK's liquidity may also be adversely affected if it is found liable
      in respect of contingent legal, tax and other liabilities. The amount
      and timing of the resolution of these contingencies remain uncertain.

Financing activities

There were no significant financing activities during the quarter.


During the quarter the Company entered into an agreement with Siemens for
the purchase of hardware and software licences, together with an ongoing
equipment rental charge The minimum commitment is 15.3 million pounds payable
between now and September 2011.

In November 2010, the Company entered in a ten year lease, break clause
after five years, for London office space with a minimum commitment of 3.9
million pounds.


The UK Government announced on June 22, 2010 there will be a reduction of
the corporation tax rate from 28% to 24% over four years beginning on April
1, 2011
. On July 27, 2010 the Government fully enacted the first stage of the
process by reducing the tax rate from 28% to 27% with effect from April 1,


The GCUK sales organization has been supplemented in the last 12 months,
although the additional resources have not yet resulted in appreciable
revenue growth. In the third quarter of 2010, GCUK experienced some softness
in short-interval demand related to purchases of equipment and professional
services and also experienced an increase in sales credits. The UK market
continues to be highly competitive with significant pricing pressure, and we
expect that competitive environment to continue.

One of our principal customer relationships is with the Foreign &
Commonwealth Office ("FCO"), to whom we provide an international
telecommunications network known as the FTN. Our contract to provide the FTN
expired in May 2010. We have entered into transition arrangements in respect
of the FCO's migration to a network to be provided by a competitor as the
replacement for the FTN. We do not expect this to have a significant impact
on our 2010 results and estimate our 2011 revenue to be adversely impacted by
between 6 million pounds to 10 million pounds. In addition, we continue to
pursue other ordinary course commercial opportunities with the FCO.

Subsequent to the quarter end, we entered into two new agreements
relating to services for existing customers. The first of these is with
Network Rail under which we will provide voice and data services for an
additional three years. Second, on the completion of a prior agreement to
provide telephony and other services to Her Majesty's Revenue & Customs
("HMRC"), we entered into a new deal with a systems integrator partner to
provide managed hosted IP telephony and contact center services to HMRC for a
further five years.

    Global Crossing (UK) Telecommunications                    Schedule 6
     Limited and Subsidiaries
    Reconciliation of OIBDA to Net Profit/(Loss)
    Results below are in pounds sterling in thousands

    Pursuant to the SEC's Regulation G, the following table provides a
    reconciliation of OIBDA, which is considered a non-GAAP (Generally
    Accepted Accounting Principles) financial measure, to net
    profit/(loss)under IFRS.

    OIBDA is defined as operating profit before depreciation and
    amortization and foreign exchange gains/(losses) on operating working
    capital movements, based upon our consolidated statements of operations.
    OIBDA differs from operating profit, in that it excludes depreciation
    and amortization. Such excluded expenses primarily reflect the non-cash
    impacts of historical capital investments, as opposed to the cash
    impacts of capital expenditures made in recent periods. In addition,
    OIBDA does not give effect to cash used for debt service requirements
    and thus does not reflect available funds for reinvestment,
    distributions or other discretionary uses.

    Management uses OIBDA as an important part of our internal reporting and
    planning processes and as a key measure to evaluate profitability and
    operating performance, make comparisons between periods, and to make
    resource allocation decisions. Management believes that the investment
    community uses similar performance measures to compare performance of
    competitors in our industry.

    There are material limitations to using non-GAAP financial measures.
    Our calculation of OIBDA may differ from similarly titled measures used
    by other companies, and may not be comparable to those other measures.
    Additionally, OIBDA does not include certain significant items such as
    depreciation and amortization, finance revenue, finance charges,
    foreign exchange gains/(losses), income taxes and other non-operating
    profit or loss items. OIBDA should be considered in addition to, and
    not as a substitute for, other measures of financial performance
    reported in accordance with GAAP.

    Management believes that OIBDA is useful to our investors as it is a
    relevant indicator of operating performance, especially in a
    capital-intensive industry such as telecommunications. OIBDA provides
    investors with an indication of the underlying performance of our
    everyday business operations. It excludes the effect of items
    associated with our capitalization and tax structures, such as
    interest income, interest expense and income taxes, and of other items
    not associated with our everyday operations.

                                           Three months ended
                                 September        June      September
                                 ---------        ----      ---------
                                  30, 2010      30, 2010     30, 2009
                                  --------      --------     --------
                                (unaudited)    (unaudited)  (unaudited)

    Net profit/(loss)               3,269       (3,422)       (1,569)
    Tax charge                         63            5            89
    Finance revenue                (1,139)      (1,161)       (1,510)
    Finance charges                 9,142        9,385         8,557
    Net foreign exchange
     (gain)/loss on foreign
     currency borrowings, net      (5,039)         220         3,576
                                   ------          ---         -----
    Operating profit                6,296        5,027         9,143
    Depreciation and
     amortization                  10,043       10,105        10,742
    Other foreign exchange
     gain/(loss), loss on
     disposal of fixed assets
     and other income                 109          (17)          459
                                      ---          ---           ---
    OIBDA                          16,448       15,115        20,344
                                   ======       ======        ======

GLOBAL CROSSING: Press Contact, Michael Schneider, +1-973-937-0146, Michael.Schneider at; or Analysts/Investors Contacts: Mark Gottlieb, +1-800-836-0342, glbc at, or Gino Mathew, United Kingdom, +1-973-937-0133, gino.mathew at

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