WorldCom goes from bad to worse

Matters at WorldCom have taken a turn for the worse today, with the bankrupt company saying it needs an extra five months to try to work out a recovery plan.

With a number of senior execs having already pleaded guilty to fraud in the investigation into its record breaking bankruptcy, it would be hard to imagine how things could get any worse for WorldCom, but today the troubled firm announced increased losses during July and August which have set back plans of a successful reorganisation.

The company also added to this latest dose of bad news, issuing a statement warning that when it finally emerges from its bankruptcy proceedings WorldCom shares are likely to be "worthless" - a fact many had already assumed to be the case.

WorldCom is obliged to report financial statements to the US Bankruptcy Court as part of the ongoing process of reorganisation. July and August saw losses of $429m on revenue of $4.8bn.

WorldCom also warned that further write-downs as a result of the investigation into accounting scandals and misstated results may also hit future results.

WorldCom expects to emerge from bankruptcy in March 2003 at the earliest.