SoftBank first-half net profit jumps on strong investment returns

Under CEO Masayoshi Son, above, SoftBank has increasingly been seen as an investment firm, plowing funds into a broad range of companies and projects outside its core business. (AFP)
Updated 05 November 2018
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SoftBank first-half net profit jumps on strong investment returns

  • Net profit rose to ¥840 billion from ¥103 billion during the same period last year
  • The rise was largely driven by gains of ¥649 billion from the SoftBank Vision Fund

TOKYO: Japan’s SoftBank Group said Monday it logged an eight-fold jump in net profit in the six months to September thanks to strong returns from its investment funds.
Net profit rose to ¥840 billion ($7.4 billion) from ¥103 billion during the same period last year, the Japanese mobile giant and IT investor said.
The rise was largely driven by gains of ¥649 billion from the SoftBank Vision Fund, which compared to ¥194 billion in the previous period.
Under tycoon CEO Masayoshi Son, SoftBank, which started as a software firm, has increasingly been seen as an investment firm, plowing funds into a broad range of companies and projects outside its core business.
In recent years, it has completed deals with the likes of French robotics firm Aldebaran and Chinese e-commerce giant Alibaba.
Nearly half of the money in the SoftBank Vision Fund comes from Saudi Arabia and there has been a pledge of another $45 billion this year.
That gives the Saudis at least an indirect role in some of the hottest companies in the tech sector, including Uber, Slack, WeWork and Nvidia.
SoftBank has also made high-profile investments in the autonomous vehicles sector, announcing last month a tie-up with car giant Toyota for “new mobility services” such as meal deliveries.
Earlier this year, General Motors said the Japanese firm was investing $2.25 billion in GM’s autonomous car program in exchange for a stake in the venture.


UK inflation rises in April by less than Bank of England expected

Updated 22 May 2019
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UK inflation rises in April by less than Bank of England expected

  • Consumer prices rose at an annual rate of 2.1 percent in April after a 1.9 percent increase in March
  • Electricity and gas prices were the biggest driver of inflation last month

LONDON: British inflation rose last month by less than the Bank of England and investors had expected, but still hit its highest level this year, pushed up by a rise in energy bills.
Consumer prices rose at an annual rate of 2.1 percent in April after a 1.9 percent increase in March, the Office for National Statistics said on Wednesday. A Reuters poll of economists had pointed to a rate of 2.2 percent, the same as the BoE’s forecast.
Sterling and government bonds were little changed by the data as core inflation, which excludes energy and food prices, held steady at 1.8 percent for the third month in a row.
“In principle, this is another reason to think the Bank of England will keep rates on hold for the foreseeable future,” ING economist James Smith said.
But he added that a strong labor market meant an interest rate hike in November could not be ruled out.
A recent weakening of inflation, combined with the lowest unemployment rate in 44 years and rising wages, has taken the edge off the uncertainty about Brexit for many households whose spending drives Britain’s economy.
But Britain’s energy regulator raised a price cap on energy providers by 10 percent with effect from April, and all big six suppliers raised their standard prices by the same amount, which the BoE said would push inflation above target briefly.
Electricity and gas prices were the biggest driver of inflation last month, the ONS said.
Computer game and package holiday prices helped to offset the impact of the higher bills.
The ONS figures also suggested less short-term pressure in the pipeline for consumer prices than expected.
Manufacturers’ costs for raw materials — many of them imported — were 3.8 percent higher than in April 2018, much less than the 4.5 percent rise predicted by the Reuters poll.
The ONS said house prices in March rose by an annual 1.4 percent across the United Kingdom as a whole compared with 1.0 percent in February, marking the first increase in house price inflation since September.
Prices in London alone fell by 1.9 percent, a smaller drop than in February.
The ONS also revised down its estimate for Britain’s budget deficit in the last 2018/19 financial year that ended in March.
The headline measure of public sector net borrowing amounted to £23.5 billion ($29.8 billion) that year or 1.1 percent of gross domestic product, compared with the previous estimate of £24.7 billion or 1.2 percent of GDP.
In April, the first year of the 2019/20 financial year, the deficit stood at £5.8 billion, as expected by economists.