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Technology Stocks : Softbank Group Corp -- Ignore unavailable to you. Want to Upgrade?

To: Edwin S. Fujinaka who wrote (4789)	4/7/2000 5:11:00 PM
From: Edwin S. Fujinaka	Read Replies (1) \| Respond to of 6018

Perhaps the Headline at the Bloomberg Site is preferable to the Nikkei Net Headline <G>? Even the tenor of the conjecture in the body of the story has a negative spin. (I wonder if Softbank used the word "plunged" in the text of their press release?) In the US OTC Market it looks like Softbank will close up a little from yesterday's $650 close since Schwab is quoting an indication of $690 to $740: quote.bloomberg.com Softbank Extends Drop; Has Plunged 58% in Six Weeks (Update4) By Hiroshi Suzuki Tokyo, April 7 (Bloomberg) -- Softbank Corp. shares extended their decline, slipping 4 percent to a 15-week low after Japan's largest Internet investor said profit last year likely plunged from a year earlier. The stock sank 3,000 yen to 70,500, and has lost 58 percent of its value in the last six weeks. It has now returned to levels where it traded in December, before a rush into Internet stocks caused it to double. The company's profit warning, released after the close of trading yesterday, deepened investors' concerns that it may need to sell assets to raise cash, analysts said. It now expects group net profit to tumble 91 percent to 3.5 billion yen, ($33.4 million), in the year ended March 31 on losses from the sale of two units in the U.S. ``Softbank's 3.5 billion yen net income is too small when you consider the capital gains it posted,' said Kota Nakako, an analyst at Warburg Dillon Read, who rates the shares ``hold.' He expects the shares will slide further to about 60,000 yen. The share plunge comes amid similar woes at many of Japan's best-known Internet-related companies. Hikari Tsushin Inc. was untraded today for a sixth straight day. Sellers outnumbered potential buyers on concern earnings at the mobile phone subscription company and Internet investor won't live up to expectations. The Sankei-Bloomberg Internet Index of 30 Internet-related companies in Japan has declined 33 percent this year. Selling Stakes Last week, Softbank raised about 58.9 billion yen selling shares in its Softbank Technology unit, re-opening questions about its financial condition. Last month, it completed the sale of its entire 4.85 percent stake in Trend Micro, a maker of anti-virus software, for 66.9 billion yen. Softbank is also considering a share offering to raise 300 billion yen, the Nihon Keizai newspaper reported, without citing sources. A company spokesman said it is considering a share sale, but hasn't made a decision. Softbank said net profit will probably fall because of losses on the sale of its stake in Kingston Technology Co. and assets in its Ziff-Davis-dominated media group. On March 7, Ziff-Davis, which is 69 percent owned by Softbank, said it plans to spin off its ZD Events trade-show business as it prepares to merge with its Internet unit, ZDNet. Softbank sold Kingston Technology in July. The company expects to post an extraordinary loss of 197 billion yen from those sales. Foreign Exchange Loss Yesterday Softbank said it also expects to post a pretax loss of 55 billion yen in fiscal 1999, wider than the 15.4 billion yen loss the previous year. It attributed the drop partly to a 47.5 billion yen loss on yen-denominated long-term debt held by its U.S. unit, Softbank Holdings Inc., due to yen's appreciation against the dollar. Warburg Dillon Read's Nakako said the 47.5 billion yen loss pointed to the company's failures in ``foreign exchange risk management.' ``All companies engaged in international operations should hedge risks in foreign exchange movement,' he said. The weak earnings forecast yesterday also reignited investor doubt about the company's once-privileged position in the business of bringing everything from shopping to banking to the Internet. ``The company's status is now threatened' by big names such as Sony Corp., the world's second-largest maker of home-use electric appliances, and Sakura Bank Ltd, Japan's fifth-largest bank, which are raising their presence in the online businesses, he said.