NTT's full year net profit slumps 30%

12 May 2006

Nippon Telegraph and Telephone Corp (NTT) has reported a 30% decline in net profit for the year ended 31 March 2006, as both its mobile and fixed line services struggled amid stiffer competition. Japan’s largest telecoms firm reported a net profit of JPY498.7 billion, down from the previous year’s JPY710.2 billion. Operating profit dipped 1.7% to JPY1.19 trillion, as revenue dropped 0.6% to JPY10.74 trillion. The company blamed tougher competition, especially from KDDI and Softbank Corp, which last month agreed a deal to buy Vodafone KK. Revenue from its fixed line voice services fell 5.5%, while income from its mobile counterpart NTT DoCoMo tumbled 2.8%. Income from non-traffic services increased 10.2%, helping limit the drop in overall revenue, while the number of customers to its ‘B’ Flets fibre-optic service doubled to 3.4 million at the end of March; the company forecasts that subscribers to ‘B’ Flets will reach 6.1 million by the end of March 2007, with users of optical IP phones rising to three million. At the same time it expects subscribers to its low-end ADSL service to fall to 5.58 million, from 5.68 million. For its FOMA 3G service, NTT said it expects the number of users to increase to 35 million by the end of March 2007, from 23.46 million.