FLORHAM PARK, N.J. -- Global Crossing (NASDAQ: GLBC) today reported its preliminary financial results for the fourth quarter and year ended December 31, 2003. In addition, the company announced several key milestones in 2003 and offered an outlook for 2004.

"Today Global Crossing is a company with a clean balance sheet, minimal debt, strong corporate governance and a seasoned management team that will steer the company into a leadership position within the telecommunications industry," said John Legere, Global Crossing's chief executive officer. "We expect these achievements, combined with the growth potential in the markets we are pursuing, to position the company for a strong future."

2003 Year-End Financial Results

Revenue

Global Crossing's results for 2003 principally reflect the operations of the company prior to completion of its restructuring. Results for the fourth quarter include 22 days of operations following emergence from bankruptcy.

"Global Crossing was able to largely maintain the revenue base by focusing on customer retention, rather than acquisition, during our restructuring," noted Legere. "Now that we have emerged, we expect to grow our business by both adding new customers and enhancing services for existing customers."

For the year ended December 31, 2003, Global Crossing reported total revenue of $2.932 billion, a six percent decrease from the $3.116 billion reported for the prior year. Revenue for the year was impacted by the company's extended period in bankruptcy as well as continued pricing pressure in the marketplace. Total revenue consisted of telecom services revenue of $2.763 billion and Global Marine revenue of $169 million.

Of the total telecom services revenue reported for 2003, commercial services accounted for 38 percent compared to 43 percent in 2002, carrier services for 61 percent compared to 55 percent in 2002, and consumer services for one percent compared to two percent in 2002. The shift towards carrier services in year-over-year business mix was due in part to carrier customers' greater willingness to utilize services from providers undergoing restructuring.

Of the commercial services revenue in 2003, 53 percent was attributable to voice services compared to 54 percent in 2002, and 47 percent was attributable to data services compared to 46 percent in 2002.

Of the carrier services revenue in 2003, 83 percent was attributable to voice services compared to 80 percent in 2002, and 17 percent was attributable to data services compared to 20 percent in 2002. While data volume grew throughout Global Crossing's Chapter 11 proceedings, revenue was pressured by price competition.

Cost Management

"We continued to make strides in controlling operating expenses throughout 2003, while maintaining a high level of customer satisfaction and network reliability," continued Legere. "Moreover, we continued the implementation of our industry-leading VoIP network, which we expect to carry more than 40 percent of our overall voice traffic by the end of 2004."

Cost of access declined six percent to $1.915 billion for 2003 (representing 69 percent of telecom services revenue), compared to $2.047 billion for 2002 (representing 71 percent of telecom services revenue). Consolidated third party maintenance costs were $112 million in 2003, compared to $158 million in 2002. Consolidated operating expenses for 2003 were $908 million, compared to $1.208 billion in 2002. Telecom services operating expenses were $741 million in 2003, compared to $967 million in 2002. Global Marine operating expenses were $167 million for 2003, compared to $241 million in 2002. Global Crossing's operating expense reductions reflected a substantial decrease in employee and facility-related expenses. In addition to cost savings, these measures improved productivity and efficiency in the operation of the company's network.

Earnings

Consolidated earnings before interest, taxes, depreciation and amortization (EBITDA) for 2003 were $12 million, compared to a loss of $297 million for 2002. Global Marine EBITDA was $30 million, compared to $29 million in 2002. Telecom EBITDA for 2003 was a loss of $18 million, compared to a loss of $326 million in 2002. Net income in 2003 was $24.730 billion, which included a net gain of $24.842 billion related to the reorganization. This net reorganization gain in income resulted from the accounting impact of recording the company's new debt and equity structure, the write down of pre-petition liabilities and deferred revenues from prior period IRU sales, vendor settlements, restructuring costs, retention plan costs and professional fees related to the bankruptcy.

Pursuant to Regulation G, a reconciliation of EBITDA to the company's net income for the relevant periods is included in the attached financial statements.

Capital Expenditures

For 2003, cash capital expenditures totaled $152 million compared to $281 million for 2002. With a core network that was substantially completed in June 2001 and as the company's focus has evolved from network construction to service capabilities, capital expenditures in 2003 were comprised mostly of success-based capital spending, which is spending that is tied directly to revenue. This includes capital spending on edge equipment and customer premise equipment.

Fourth Quarter 2003 Financial Results

Revenue

For the fourth quarter of 2003, total revenue was $719 million compared to $765 million for the same period in 2002. The decrease in total revenue was primarily attributable to the company's delayed emergence from Chapter 11 and continued pricing pressures resulting from a competitive market, partially offset by growth in the company's carrier business segment. Total revenue consisted of telecom services revenue of $679 million and Global Marine revenue of $40 million.

Of the total telecom services revenue reported for the fourth quarter of 2003, 36 percent was attributable to commercial services, 63 percent to carrier services, and one percent to consumer services. The mix of voice and data was comparable to that of the full year 2003.

Cost Management

For the fourth quarter of 2003, cost of access declined 12 percent to $471 million (representing 69 percent of telecom services revenue) compared to $534 million (representing 75 percent of telecom services revenue) for the same period in 2002 as a result of the company's continued initiatives to reduce access costs. Consolidated third party maintenance costs for the fourth quarter were $27 million compared to $28 million in the fourth quarter of 2002. Consolidated operating expenses for the fourth quarter of 2003 were $208 million compared to $265 million for the same period in 2002. Telecom services operating expenses declined 12 percent to $178 million, compared to $203 million in the same period of 2002, as a result of the company's effort to streamline global operations and a one-time benefit from a UK property tax rebate of $13 million, partially offset by the hiring of additional salespeople. Global Marine's operating expenses were $30 million, a 52 percent decline from $62 million in 2002, resulting primarily from restructuring efforts, which significantly reduced vessel costs, personnel and overhead expenses between the two periods, as well as reduced project costs.

Earnings

For the fourth quarter of 2003, EBITDA improved to $13 million as compared to a loss of $62 million for the same period in 2002. Global Marine EBITDA was $13 million for the fourth quarter of 2003 compared to a loss of $5 million for the same period in 2002. Telecom EBITDA was break-even in the fourth quarter of 2003 compared to a loss of $57 million for the same period in 2002. Net income in the fourth quarter of 2003 was $24.879 billion, which included $24.882 billion in reorganization-related gains described above.

Capital Expenditures

For the fourth quarter of 2003, cash capital expenditures totaled $33 million, compared to $91 million for the fourth quarter of 2002, driven by the need to deploy success-based capital to meet customer needs.

Global Crossing Holdings Ltd.