Here's the transcript from that Casey guy's interview on CNBC the other day. i think he did a good job.
Global Crossing = CEO- Interview
Mark Haines
MARK HAINES, ANCHOR, CNBC, SQUAWK BOX: Global Crossing is moving downtown. The company is transferring to the Big Board from the NASDAQ. It begins
trading today on the Big Board today under the ticker symbol GX. Global Crossing builds and offers services over a global, IP based, fiber optic network. It started out as an
undersea cable company, which is why you are seeing all those boats and undersea stuff. But it is more than that now. Shares of Global Crossing are trading near its year
low of $20 a share. Maybe it is talking about the stock, which I`ve owned from much higher levels. It has a year high of $62, which is a lot closer to where I bought it than
$20 is.
Let`s get more on the company`s outlook. Joining us from The New York Stock exchange, Global Crossing`s CEO Thomas Casey. Mr. Casey, thanks very much for being
with us.
THOMAS CASEY, CEO, GLOBAL CROSSING: Good morning. Thanks for having me.
HAINES: Let`s see, in the last 12 months, stock down 36 percent. Analysts estimate this year you loose $2.61, next year $2.70. Wall Street thinks the Exodus deal is
dilutive. Is anything going right?
CASEY: Well, Mark, the business is going right. Revenue this year is up over last year. We feel very good about the performance of the company. We are rolling out
products and services over the 100,000 mile global network and that network is about to be finished. It will be built and in service from East Asia to Eastern Europe in the
next six to eight months.
HAINES: A lot of people feel that there is a glut of fiber line capacity and that the result will be a 20 to 30 percent decline in your pricing power over the next few years. Do
you agree or disagree?
CASEY: There is a substantial amount of fiber being put into the ground, Mark, but two things are important. One is much less is going under the oceans than in the
ground and even the part that is being put in the ground is not being lit up. So our experience is that every time we do a forecast of demand we increase the forecast. Every
time we actually have the experience, our experience exceeds the forecast of demand that we have had.
JIM CRAMER: Mr. Casey, Jim Cramer here. A couple of things. First, congratulations on the move over. One thing that has struck me about your company is it has been
fabulous at financing. You`ve got lots of money. You are able to be funded for your build out for the next couple of years. Are you salivating at the prospects that there are a
lot of competitors that are about to go out of business or be bankrupt that you can sit there and cherry pick their assets?
CASEY: Well, the most important point is, as you were talking about, that we are fully funded through the business plan that we have now through the end of the
construction that we have. That gives us a tremendous amount of strength and comparative advantage over other people that still have to go back into the markets and get
capital to finish their networks. We are pretty much finished the geographical expansion of the network. So we don`t think that we have a lot of assets that we need to buy.
If there are special circumstances where we can buy assets that are helpful to the network at less than $0.100 on the dollar, then we will probably look at that. But right
now we are not looking actively at buying too many assets.
CRAMER: Are you surprised at the tremendous decline in your whole sector, which seems to be tarnished by a couple of companies that we have all known were highly
leveraged and needed everything to go right? It seems like your stock has been pulled down, I am not lowering your stock, but I am doing the work for coming on. I
recognize that your stock has just traded exactly as though it were one of the CLECs that is out of money.
CASEY: That is right and that is unfortunate because we have made every quarter that we`ve, since we`ve been a public company. As you said earlier, we are a fully
funded. And our job, I guess, is to continue to operate the business successfully, roll out the products and services, increase the revenue and the EBITDA, which we were
doing, and hopefully the market will begin to differentiate between the winners and losers. And when they do that we are confident we will be one of the winners.
DAVID FABER: Yeah, but Tom, I mean you do get lumped in with the long distance players as well and you do have a long distance network in that frontier. How do you
tell investors who are saying hey, you are just like a WorldCom or an AT&T, how do you ultimately say no, we are not?
CASEY: Well, David, we have, they, as you know, have billions of dollars of consumer long distance voice that they are struggling with pricing and margins. We have about
$40 million a quarter against this year, $5.2 billion, $5.3 billion of total revenue. So our consumer long distance voice business is not material to us to in any way, whereas
for them it is a very substantial part of their business.
FABER: Tom, you know, our viewers may not know, and you are a student of telecom, you have been in this business a very long time, on the banking side as well for a
number of years. What about this year? Are we every going to see a year like this again? How do we come out of it and when does it ultimately happen? I am talking
about, of course, what has gone on with so many of the equities in your sector.
CASEY: I hope we don`t see too many more years like this, David. But I don`t know when we come out of it. I mean the market will eventually begin to see that there are
winners that will emerge from the sector. Telecom is a growing part of the GDP. It used to be around two percent, now it is three percent, it is going up to five percent over
the next five or 10 years. The GDP itself is growing. We are a fundamental success factor for economic growth worldwide and we have to be one of the sectors that people
have to own if they want growth in their portfolio. So eventually investors will come back to that, realize that and begin to differentiate the winners and losers. And as I said,
our job is to make sure that when that happens we have operated the business successfully and we are one of the winners.
haines: Mr. Casey, thank you very much. Tom Casey, CEO of Global Crossing.
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