CenturyLink is conducting a strategic review of its consumer business, and selling the business or spinning it off haven’t been ruled out as options.
Jeff Storey, CenturyLink’s CEO, discussed the review process during last week’s first-quarter 2019 earnings call. The company reported a first-quarter loss of $6.17 billion, compared to a $115 million profit for the year-ago quarter.
CenturyLink is examining assets like its consumer business, and has “engaged advisers to assist us in that review,” Storey said.
“Let me be clear; we’re early in what I expect to be a lengthy and complex process,” he said. “During our review, we will not modify our normal operations or our investment patterns. I can’t predict the outcome or the timing of this work or if any transactions will come from it at all. Our focus, though, is value maximization for shareholders.”
Courtney Morton, CenturyLink’s senior communications manager, tells Channel Partners that “we are pleased with the performance of our consumer business and are comfortable operating the business for the long term.”
“As a company, we consistently evaluate our portfolio to identify opportunities where we can drive more value,” she said. “The strategic review is designed to help us better understand whether there are opportunities to better maximize the value of this asset.”
Storey said if there are “better paths to create more value with these assets, we will pursue them.”
“Stepping back and looking at the overall business, we are transforming how we operate,” he said. “Product development and enhancements are a key part of our transformation initiatives. We’ve made investments to better serve customers, operating in single or multicloud environments, investments in our SD-WAN and adaptive virtual services portfolio, and our connected security capabilities.”
In the meantime, CenturyLink hasn’t blocked out any alternative that “makes sense” for the consumer business, “but it’s really early in the process for us to go into too much detail about what that might look like,” Storey said.
“There’s nothing about our operating performance that’s causing us to decide we want to sell it,” he said. “In fact, our operating performance says, hey, doing a good job, keep running it.”