Cutting cots, Qwest orders contractors to stop work on worldwide network

Friday, November 2nd 2001, 12:00 am
By: News On 6

DENVER (AP) _ Qwest Communications International Inc. has told contractors and vendors working on the company's worldwide network to stop work immediately.

Chris Hardman, a Qwest spokesman, confirmed the order but wouldn't disclose how many contractors or how much work is affected. He said the directive is part of an effort by the Denver-based telecommunications company to cut costs, including capital expenditures.

The directive ``was sent to contractors giving notice to suspend certain operations until an analysis is complete,'' Hardman said. In the meantime, ``we are fixing service issues and doing everything we need to move forward,'' said Hardman. He said network upgrades being performed by employees also are continuing.

Qwest's directive to contractors and vendors was posted late Wednesday on a popular corporate-bashing Internet site. According to the directive, contractors were to stop work by the end of the day, take back any materials not installed, finalize labor invoices immediately and help prepare a project status report.

The decision to assess work being done by contractors comes as Qwest reported this week an unexpected loss of $142 million and flat revenues for its third quarter. At least nine analysts have downgraded Qwest stock since the results were issued, and the company's stock price has declined more than 20 percent.

In a conference call Wednesday, Qwest Chief Executive Joe Nacchio told analysts he would manage capital expenditures tightly in what he described as a deteriorating economy, and to bring Qwest to cash-flow positive by mid-2002.

Chief Financial Officer Robin Szeliga said Qwest was accelerating layoffs that were announced in September. About 5,000 jobs are being cut.