NTT H1 operating profit hit by mobile slump

8 Nov 2007

Japanese telecoms giant Nippon Telegraph and Telephone Corp (NTT) has posted consolidated operating profits of less than JPY600 billion (USD5.27 billion) in the fiscal first half ended 30 September 2007, as profit declines at its mobile unit NTT DoCoMo impacted on its bottom line, according to Thomson Financial News citing an unconfirmed report in the Nikkei business daily. The latest operating profit figure compares with JPY691.52 billion posted in the first half of fiscal 2006. DoCoMo accounts for approximately 70% of group operating profit, but last month said its profits were down 21% to JPY408.50 billion in 1H07 as a result of spiralling costs related to retaining existing users and signing up new ones in a competitive cellular market. On a more positive note, NTT’s full year operating profit is expected to be between JPY1.3 trillion and JPY1.4 trillion, beating the company’s official forecast of JPY1.11 trillion, the Nikkei said. This has been attributed to capital gains of around JPY340 billion related to the return of pension assets the company managed on behalf of the government.