NTT posts $2.1B 1H loss after heavy writedown


Happier days: NTT Communications president Masanobu Suzuki announces the $5.5B purchase of Verio in May 2000

TOKYO, Japan (CNN) -- Japan's biggest telco, Nippon Telegraph & Telephone Corp, reported a group net loss of 262 billion yen ($2.1 billion) for its first half Thursday after writing down two overseas investments by more than $6 billion.

About $4 billion of that was a writedown of its stake in U.S. Internet company Verio, which NTT bought in May 2000 for $5.5 billion.

NTT also said it now sees a net loss of 331 billion yen ($2.7 billion) for the full year to next March because of the writedowns and restructuring costs for its two operating units, NTT East and NTT West.

It is predicting a 3.5 percent lift in group annual revenue to 11.8 trillion yen ($96.8 billion) and a fall of 8.4 percent in operating profit to 665 billion yen ($5.45 billion).

NTT, which is 46 percent owned by the Japanese government, wrote down its 15 percent stake in Dutch telco KPN Mobile by 262.7 billion yen ($2.15 billion) and in Verio by 498 billion yen ($4 billion).

NTT said the ongoing IT recession and the slowdown in the U.S. economy made it necessary to revalue its overseas investments.

It said its group revenue for the six months to September 30 rose 5.8 percent to 5.8 trillion yen ($47.6 billion), while group ordinary profit slipped almost 27 percent to 403.4 billion yen ($3.3 billion).

NTT also said it would be moving a total of 100,000 employees into subsidiaries.