DoCoMo may post heavy half-term loss

By Staff and reports

TOKYO, Japan (CNN) -- NTT DoCoMo may post a huge loss in the six-month period through September, aggravated by the falling stock prices of its overseas telecom holdings.

A global downturn in telecom shares has raised doubts whether the telco will have to mark down its investments on an otherwise healthy earnings picture.

The company is firm in its belief that it will not write down the value of assets related to its overseas investments.

Grim prospects

DoCoMo forecast $3.2 billion in group net profit for the year ending in March.

But given the grim prospects for its overseas investments, the company may slip into a hefty net loss, according to the Nihon Keizai Shimbun.

DoCoMo president and chief executive Keiji Tachikawa told reporters on Thursday that the company is closely watching its overseas investments and would take action if necessary.

In January, the mobile operator paid $9.8 billion for a 16 percent stake in AT&T Wireless in a bid to take its I-mode wireless data service overseas.

AT&T Wireless listed on the New York Stock Exchange, but its shares have tumbled in value since DoCoMo made the investment.

Stock prices of DoCoMo's European investments have also fallen, leading to unrealized losses that Japanese media reports calculate at around $4.8 billion to $5.7 billion.

In a statement, the mobile operator said it would write down the value of the assets in the fiscal year if the stock price falls dramatically and a write down is deemed necessary.

"However NTT DoCoMo would like to clarify that at this point, NTT DoCoMo is not considering writing down these assets," the statement said.

DoCoMo's objective behind its overseas investments, an international take-up of its I-mode service, has hit a few hiccups.

The company said on Thursday that a lack of mobile phone handsets might hold up the launch of mobile Internet services in Europe.

Reuters contributed to this report.