August 05, 2002, 11:08 AM — The European arm of WorldCom Inc. remains upbeat about its business prospects, despite growing speculation about declining sales, fleeing customers and a possible sell-off, according to a spokeswoman commenting Monday after a published report painted a bleak picture.
On Monday, the Financial Times reported that sales at WorldCom's European division have plummeted nearly 50 percent since the parent company filed for Chapter 11 bankruptcy on July 21. The paper based the report on a conference call that Lucy Woods, chief executive officer of WorldCom's international division in London, held with the unit's employees last week.
"Contrary to news reports, our sales in WorldCom's European operations have not fallen by 50 percent," Woods said in a statement released Monday after the Financial Times published its report. "Our sales performance in Europe remains solid and continues to be one of the company's largest growth drivers. We remain a core part of WorldCom's operations."
In last week's conference call, Woods said that July sales were strong despite a traditionally quiet month, the company spokeswoman said. Woods urged employees to remain "calm" as WorldCom undergoes restructuring in the U.S.
"Management in the U.S. is telling us that we are a core part of the group's business and are not up for sale," the spokeswoman said.
The WorldCom international division currently employs 8,300 people, according to the spokeswoman. As part of a group-wide program to trim costs, the unit cut 450 jobs "several months ago but none since then," she said.
The spokeswoman declined to comment on rumors that the European unit is planning a huge wave of layoffs and is losing about US$500 million a year.
Julian Lewett, chief analyst at Ovum Ltd. in London, said that WorldCom's international businesses in Europe and Asia are likely to be sold off. He expects AT&T Corp. will be a major contender to acquire key assets of its global rival.