Troubled PSINet Delays Filing Annual Report

PSINet (PSIX Quote) said Tuesday it has delayed filing its annual financial report with the Securities and Exchange Commission due to "rapidly changing circumstances," and repeated a previous warning that its stock may soon be worthless.

The Internet service provider said it has hired outside consultants to help evaluate impaired assets in order to finalize financial statements, which it expects to do within the 15-day extension period. The company took restructuring and impairment charges during the first nine months of 2000 and said it expects that additional "significant" restructuring and impairment charges for the fourth quarter of 2000.

The company said it expects to receive a going concern qualification from its auditors, however it said it cannot guarantee it will not run out of cash.

Goldman Sachs is advising PSINet on alternatives, including a merger or bankruptcy. Dresdner Klenwort Wasserstein is examining ways to restructure the company's debt.

Shares of PSINet fell to 15 cents during preopen trading on Island Tuesday, down 4 cents from a 19-cent close on Monday on the Nasdaq.