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Last Updated: Friday, 12 March, 2004, 18:06 GMT
MCI restatement wipes out $74bn
MCI logo
MCI is slowly emerging from the shadow of Worldcom
MCI, which used to trade under the name Worldcom, has restated two years of earnings as the disgraced phone company tries to rehabilitate itself.

Previous pre-tax profit figures for 2000 and 2001 have been cut by a total of $74.4bn (41.4bn), the company said.

The move is expected to accelerate its emergence from bankruptcy protection, which is now set for the end of April.

Worldcom shot to prominence in 2002 when it admitted to inflating profit reports by illegally booking expenses.

Another step

The scandal was one of the main contributors to a slide in world markets that knocked billions off the value of stocks and shook Wall Street to its foundations.

Since then, Worldcom has been restructuring under new management, protected by the US's Chapter 11 bankruptcy rules.

Chief financial officer Bob Blakely said that Friday's filing "culminates the largest and most complex financial restatement ever undertaken".

"It is one of the last remaining milestones on our path to emerge from Chapter 11."

Analysts said that while it was an important development, it was too early to say whether the company was ready to trade normally because it still had to file a 2003 earnings report.

Those figures, they said, would show the true health of the Worldcom business.

Under the restated figures, Worldcom now shows a loss for each of the three years between 2000 and 2002.

It previously had either booked profits or not submitted anything at all.

According to the company, it had a loss of $9.2bn in 2002, $15.6bn in 2001 and a massive $48.9bn in 2000.

Mr Blakely was keen to point out that "while these restatement adjustments are substantial they do not have any impact on our current substantial liquidity position".

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