Japan’s SoftBank net profit boosted by Alibaba listing

  • TECH
  • Tuesday, 10 Feb 2015

MIXED BAG: President of Japan's mobile communication giant SoftBank, Masayoshi Son, speaking to the media to announce the company's third quarter financial results (ending December) in Tokyo on Feb 10. SoftBank said its April-December net profit rose 15.9% to a record high but gains were eroded by restructuring at US wireless carrier Sprint.

TOKYO: Japan’s SoftBank said nine-month net profit rose 15.9% to a record high, boosted by its huge stake in Chinese e-commerce giant Alibaba, which listed in New York last year. 

Net profit for April-December came in at 579.4bil yen (RM17.37bil), although it said gains were eroded by restructuring at newly acquired US wireless carrier Sprint. 

SoftBank has a one-third equity stake in Alibaba, whose US$25.02bil (RM89.01bil) initial public offering in New York in September was the biggest in history. The firm made a US$5bil (RM17.78bil) gain from the listing. 

In the December quarter alone, however, net profit dived 79.1% to 18.7bil yen (RM560.85mil) because of heavier losses at number-three US wireless operator Sprint, which the Japanese firm bought for US$21.6bil (RM76.84bil) last year. 

“Getting Sprint into shape will not happen overnight and might take half a year to a year,” Satoru Kikuchi, an analyst at SMBC Nikko Securities told Bloomberg News before the earnings announcement. 

SoftBank’s April-December revenue soared 41% to 6.4tril yen (RM191.94mil) thanks to contributions from the US carrier and other acquisitions. 

But operating profit fell 16.2% to 788bil yen (RM23.63bil) due partly to costs to reduce payrolls at Sprint and the absence of one-off gains the group reported a year before from business mergers. 

SoftBank left untouched its annual operating profit estimate at 900bil yen (RM26.99bil) on revenue of 8tril yen (RM239.93bil). — AFP 

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