CenturyLink, Inc. (NYSE:CTL) Q1 2019 Earnings Conference Call - Final Transcript

May 08, 2019 • 05:00 pm ET


CenturyLink, Inc. (NYSE:CTL) Q1 2019 Earnings Conference Call - Final Transcript


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Greetings and welcome to the CenturyLink First Quarter 2019 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 Wednesday, May 8th, 2019.

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

Valerie Finberg

Thank you, Melody. Good afternoon, everyone, and thank you for joining us for the CenturyLink first quarter 2019 earnings call. With us on the call today are Jeff Storey, President and Chief Executive Officer; and Neel Dev, Executive Vice President and Chief Financial Officer.

Before we get started, I need to call your attention to our Safe Harbor statement on Slide two of our 1Q, '19 presentation, which notes that this conference call may include forward-looking statements subject to risks and uncertainties. In addition, we will refer to certain non-GAAP financial measures, which are reconciled to the most comparable GAAP measures. Those reconciliations can be found on our Investor Relations website. Additionally, please note that certain metrics discussed on the call today exclude transformation costs and other special items, as described in our earnings materials.

With that, I'll turn the call over to Jeff.

Jeff Storey

Thanks, Valerie, and thank you everyone for joining us. CenturyLink closed the Level 3 acquisition about 18 months ago, since then we've been integrating and building a new CenturyLink by focusing on a few key objectives, improving our customer experience and delivering value to our customers, focusing our efforts on products and services to drive profitable revenue and are closely tied to our very best asset, the fiber network.

Expanding the fiber network to reach more customers and to grow our unmet footprint, not just enable today's services because a rich and deep fiber network is essential for the services we know our customers will need tomorrow, and investing and transforming our business, dramatically improving the way we operate and reducing our cost structure. Through these efforts, we delivered another good quarter of adjusted EBITDA growth and margin expansion to start the year,

Our first quarter adjusted EBITDA margin was 40.1%, which represents a significant 460 basis point improvement since we closed the Level 3 acquisition. It's also the high mark since the fourth quarter of 2015, which was the last time CenturyLink reported adjusted EBITDA margin above 40%, and we expect margins to continue to expand. As I said before, we believe we have the best fiber assets in the industry, and we are continually investing and expanding the network and our capabilities. This quarter was no exception.

During the quarter, we connected nearly 4,500 new fiber fed buildings to our network. We expanded our Edge computing capacity and added significant incremental capacity to our existing intercity network. So I'm going to think about that first step, just for a minute. We added 4,500 new fiber fed on net buildings in a single quarter. We continued to expanding the reach and capabilities