NTT lifts 3Q revenue to $26bn
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The world's biggest telco, NTT, says sales are up 1.8 % in the last fiscal quarter on the back of strong ADSL demand.
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TOKYO, Japan (Reuters) -- Nippon Telegraph and Telephone Corp, the world's biggest telecoms group by revenue, said quarterly sales have increased 1.8 percent compared with the previous three months and maintained its forecasts for the full year to end-March.
NTT's revenue came in at 2.79 trillion yen ($26.5 billion) for the third quarter to December 31.
The company, which owns local and long-distance units and has majority stakes in mobile carrier NTT DoCoMo and systems integrator NTT Data Corp, has not released nine-month results before. There is no year-ago comparison.
"It looks like the group is stable," said Credit Suisse First Boston telecoms analyst Mark Berman.
"The positive trend is that the analogue lines continue to grow on the back of strong ADSL demand so that their overall line decline is actually moderated quite a bit."
NTT, which holds 62 percent of DoCoMo and 54 percent of NTT Data, maintained its full-year net profit forecast of 582 billion yen on sales of 11.04 trillion yen.
It continues to expect a pre-tax profit of 1.41 trillion yen.
The company, in a bid to shore up profitability, has cut costs by restructuring its organization and transferring workers to lower-paid jobs at subsidiaries.
In November it posted a nearly 12-fold jump in net profit for the first half of its fiscal year, thanks to the cost-cutting measures as well as favorable comparisons with year-ago results, which were hurt by big overseas losses at DoCoMo.
Analysts were not surprised NTT maintained its financial forecasts for the full year since DoCoMo and NTT Data both reaffirmed their expectations.
NTT DoCoMo Wednesday posted nine-month earnings that showed it on track to hit its full-year target as it added subscribers to its advanced 3G service, which allows customers to connect to the Internet and download music, video and pictures at high speeds.
NTT Data reiterated Thursday its full-year target of a 30 billion yen profit on sales of 84 billion yen.
"Investors are currently buying companies with clear growth potential. In that sense, electronics makers and related firms are more attractive," said Mitsushige Akino, chief fund manager for Ichiyoshi Investment Management Co Ltd.
NTT shares might also be hurt by persistent rumours that DoCoMo was preparing a bid for number three U.S. wireless telephone company AT&T Wireless Services Inc, which it already has a 16 percent stake, he said.
Prior to Thursday's sales announcement, NTT's shares closed down 0.2 percent while the Nikkei average rose 0.17 percent.
NTT, like other telephone companies worldwide, is struggling to cope with fierce price competition and dwindling voice traffic as customers migrate to mobile phones and Internet-based calling.
ADSL, or asynchronous digital subscriber line technology, gives users high-speed access to the Internet over regular telephone lines.
ADSL use has grown exponentially in Japan, where YahooBB has led the market with cut-rate plans for data service and Internet phones. YahooBB is owned by Softbank Corp. and Yahoo Japan Corp.
Copyright 2004
Reuters. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
