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Strategies & Market Trends : VOLTAIRE'S PORCH-MODERATED -- Ignore unavailable to you. Want to Upgrade?

To: Uncle Frank who wrote (36507)	5/7/2001 1:17:34 AM
From: stockman_scott	Respond to of 65232

NTT DoCoMo earnings expected to surprise on upside Monday May 7, 1:12 am Eastern Time By Reed Stevenson <<TOKYO, May 7 (Reuters) - Revenue and profits at Japan's top mobile operator, NTT DoCoMo Inc , for the latest business year will exceed the company's forecasts due to brisk growth in new subscribers and wireless Web services, analysts said. A poll of 11 Tokyo-based telecoms analysts taken last week called for a consolidated operating profit of a median 760 billion yen ($6.26 billion) and average 753 billion yen for the 2000/01 year ended on March 31. DoCoMo, which will release its results on Wednesday at 3 p.m. (0600 GMT), forecast the figure at 728 billion yen, a 33.4 percent rise from the previous year. Chief executive Keiji Tachikawa said recently that DoCoMo can ``comfortably reach this level'' given steady subscriber growth for its i-mode services, where 23.22 million users surf the Internet on credit card-sized screens. But despite the robust projections -- a record for the company, which was spun off from parent Nippon Telegraph and Telephone Corp in 1998 -- analysts are describing 2000/01 as a year of revenue rather than profit. ``Fiscal 2000 was a year defined by growth in revenue, and 2001 will show growth in profitability,'' said Kirk Boodry, telecoms analyst at Dresdner Kleinwort Wasserstein. He expects 4.57 trillion yen in revenue and 750 billion yen in operating profit for 2000/01. The median forecast in the poll called for revenue of 4.59 trillion yen while net profit was pegged at 357 billion yen. Investors seem to agree that DoCoMo's raw earning power will remain intact. After sliding to a fourth of their value from last year's peaks, DoCoMo's shares have recovered 56.6 percent since early March and were trading at 2.8 million yen at midday on Wednesday. Reflecting such expectations, DoCoMo's price-earnings ratio is expected to be 66.85, according to the median of 10 forecasts. In the broader market, the Nikkei 225 stock average has an implied price-earnings multiple of about 44. DATA IS DRIVER DoCoMo's robust outlook is also due to its shift in revenue source to data transmission from voice calling. That is expected to boost profitability in the next business year, since DoCoMo is expected to spend less on acquiring new subscribers and instead focus on getting existing users to increase their use of i-mode and data services. Shinji Moriyuki, telecoms analyst at the Daiwa Institute of Research, said he sees data making up 10 percent of average revenue per user for the latest business year. ``I think this will grow to close to 20 percent in 2001/02,'' said Moriyuki, who estimates last year's revenue at 4.65 trillion yen and profit at 767 billion yen. DoCoMo itself sees half of its transmission revenue originating from data in 2005 as more advanced wireless services come to market. It expects to be the first in the world to begin fast third-generation, or 3G, wireless services on May 30 when it begins an introductory service in the Tokyo metropolitan area. The firm plans to invest 1.0 trillion yen over the next three years on 3G and said it would be profitable in four years. Although DoCoMo decided recently to postpone a full commercial launch until October, most expect minimal impact from the delay. Its EV/EBITDA, or enterprise value divided by earnings before interest, tax, depreciation and amortisation, in 2000/01 was 18, according to the median projected of eight analysts. That compares with an average weighted EV/EBITDA of 12.2 for Asia's wireless operators and 15 for Europe's, according to estimates by Merrill Lynch...>>