Softbank profit soars after buying mobile phone firm

Japan's Softbank Corp. has said its net profit for the nine months to December jumped 23.1 percent from a year earlier after it entered the mobile phone market and sold off assets.

The telecommunication and media firm, which also provides high-speed Internet access, posted net profit of 21.93 billion yen (182 million dollars) for the nine-month period, up from 17.82 billion yen.

Current profit came to 111.62 billion yen, reversing a loss of 2.26 billion yen a year earlier, as revenue more than doubled to 1.82 trillion yen.

The firm's earnings got a boost from its purchase in April of British mobile giant Vodafone's struggling Japanese operations, a deal which made Softbank the number three mobile phone carrier in Japan.

The mobile phone business now accounts for more than a half of the company's revenue.

"We knew the mobile phone business was very lucrative. The earnings figures show our expectations were correct," said Softbank president Masayoshi Son on Thursday.

"We are committed to making mobile phones more fun and less expensive. Rather than trying to set goals that are difficult to achieve, we will remain consistent and try to increase the number of customers at a steady pace."

The profit gain was also due to sales of shares in SBI Holdings and other affiliates that raised 80.7 billion yen for Softbank.

Softbank has been aiming to woo customers away from industry leader NTT DoCoMo after rule changes allowed people to switch mobile telephone operators without having to change their phone numbers.

The business empire built by Son, one of Japan's richest entrepreneurs, unleashed a price war against NTT DoCoMo Inc. and second-ranked KDDI Corp. when Japan introduced the "number portability" system in October.

But Softbank suffered a setback shortly afterwards due to a massive technical glitch in its own system and drew criticism that its aggressive advertising campaign to attract subscribers was misleading.

Japan's antitrust watchdog in December ordered Softbank to correct its advertisements.

The company is also still making a gradual transition from the slower second-generation mobile phone system to the improved third-generation system, after years of under-investment in the business by Vodafone of Britain.

Softbank did not provide forecasts for the year to March 2007.

source news : news.yahoo.com