SoftBank third-quarter profit up 24% in first post-IPO earnings

Seven analysts recommend or strongly recommend buying the SoftBank shares, whereas six suggest holding or selling. (Reuters)
Updated 05 February 2019
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SoftBank third-quarter profit up 24% in first post-IPO earnings

  • The results cover a turbulent three months at SoftBank
  • SoftBank maintained its forecast for operating profit to rise 10 percent to ¥700 billion for the year through March

TOKYO: SoftBank Corp, Japan’s third-largest mobile phone network provider, said on Tuesday operating profit rose 24 percent in its third quarter on growing wireless sales, in its first earnings report as a public company.
With concerns over a changing mobile market keeping its shares well below their blockbuster IPO price, investors are looking for reassurance that the telco can keep its promise of paying 85 percent of annual profit in dividends.
Others are looking for any hint of the health of majority shareholder SoftBank Group Corp, which relies on the telco’s cash to fund investments.
Operating profit was ¥191.6 billion ($1.74 billion) in October-December, compared with ¥155.1 billion in the same period a year earlier, SoftBank Corp. said in a stock exchange filing.
The results cover a turbulent three months at SoftBank. Over that period, the firm suffered a network outage, fielded ongoing government calls for lower prices, and faced scrutiny over its ties to Huawei Technologies — a Chinese company whose telecoms equipment Western powers fear could be used for espionage.
Pressure is set to continue in 2019 as market-leader NTT Docomo Inc. trumpets its annual “return” of ¥400 billion to customers and e-commerce firm Rakuten becomes the fourth major wireless carrier from October pledging low prices.
The quarter also saw SoftBank conduct Japan’s largest-ever IPO. However, the stock dropped 15 percent on its Dec. 19 debut from its ¥1,500 IPO price, leaving its overwhelmingly domestic retail investors underwater and cooling broader investor sentiment, finance executives said.
The stock closed flat on Tuesday ahead of the earnings, trading about 20 percent below the ¥1,600 average target price of 13 analysts compiled by Refinitiv.
Seven analysts recommend or strongly recommend buying the stock, whereas six suggest holding or selling.
Nomura Securities analyst Daisaku Masuno wrote in a report that SoftBank should be able to grow as market uncertainty fades through its strategy of appealing to heavy users through its industry-leading 50 gigabyte data plan while offering low-price plans through its Ymobile brand.
SoftBank maintained its forecast for operating profit to rise 10 percent to ¥700 billion for the year through March. That compares with the ¥691 billion average of 13 analyst estimates compiled by Refinitiv.


High-level Russian delegation in Iraq to discuss trade ties

Updated 25 April 2019
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High-level Russian delegation in Iraq to discuss trade ties

  • The two sides discussed trade in agriculture and industry
  • Iraq is reliant on imports to feed its population, and imports a significant portion of food items from Iran

BAGHDAD: A high-level Russian delegation is visiting Iraq to discuss trade and economic cooperation between the two countries.
The delegation, headed by Deputy Prime Minister Yury Borisov, met with Iraqi Foreign Minister Mohammed Alhakim on Thursday.
Borisov said the two sides discussed trade in agriculture and industry and said his country is seeking to increase food exports to Iraq.
Iraq is reliant on imports to feed its population, and imports a significant portion of food items from Iran.
The Russian delegation is expected to meet Iraqi Prime Minister Adel Abdul-Mahdi later in the day.