Softbank posts net loss on U.S. units
By Bill Clifford, CBS MarketWatch
Last Update: 4:45 AM ET Nov 12, 1999
NewsWatch
TOKYO (CBS.MW) -- Internet imperialist Softbank Corp. posted a
group net loss of $33 million (3.5 billion yen) in the April-September half,
largely because it has begun casting off non-online businesses that fail to
enrich the domain.
It was Softbank's first half-year loss since the company began reporting
interim results in 1997, and reversed a profit of 3.3 billion yen ($31
million) in the fiscal first half of 1998. Sales fell 18.1 percent to 201.6
billion yen, partly because of the performance of struggling U.S.
subsidiaries..
The Tokyo-based backer of more than 100
Internet ventures chalked up an extraordinary loss
of 80.64 billion yen by selling off Kingston
Technology Co., the California-based maker of
memory boards, in July. See full story.
Falling revenues and rising interest payments at
Ziff-Davis Inc. (ZD: news, msgs) also splashed red
ink on Softbank's report. Softbank owns nearly 70
percent of the computer magazine publisher, which
lost $14.9 million in the July-September quarter and
had debt of $1.17 billion. That's another non-Net
stake likely to be excised from the realm before
long.
Softbank possesses tremendous financial leverage
thanks to its soaring share price and savvier Internet
investments.
With the stock setting another record close Friday
at 61,000 yen a share (from around 6000 yen at the start of the year),
Softbank's market capitalization is roughly $60 billion -- No. 9 in a Japan
Inc. whose look the company is doing much to change. See related story.
Tremendously valuable equity stakes in companies like Yahoo Inc.
(YHOO: news, msgs), Yahoo Japan Corp. and anti-virus software
specialist Trend Micro Inc. (TMIC: news, msgs), have showered Sofbank
with tens of billions of dollars in unrealized gains.
Softbank occasionally sells bits of these investments, too. It liquidated a
slice of its Trend Micro holdings for a 70 billion yen gain, to partially offset
the Kingston loss.
Shaving its stake in U.S. portal powerhouse Yahoo to 28 percent from 30
percent early this year provided a windfall that let Softbank post record
group profit of 37.5 billion yen in the fiscal year ended March 31, 1999.
That gain disguised a pre-tax loss before extraordinary items.
Softbank did not provide forecasts for group results in the current year
through next March.
|
