I’m not an expert on investment or business news, but I do check a lot of news sources for no good reason. So the coverage of Japan Tobacco’s recent profit announcement/forecast struck me.
If you’re the Financial Times, quite possibly the world’s most trusted English-language source of business news this side of Bloomberg, you’ll probably want to let investors know what to watch out for when covering the story:
Japan Tobacco cuts full-year profit forecast
By Mariko Sanchanta in Tokyo
Published: February 9 2007 23:28 | Last updated: February 9 2007 23:28
Japan Tobacco on Friday cut its full-year profit forecast due to costs related to its $14.7bn acquisition of Gallaher, the UK tobacco company.
The world’s third largest cigarette company said it expected full-year profits of Y202bn for the year ending March 31 down from a previously forecast Y206bn.
But if you’re the Nikkei, Japan’s leading business news source, you might consider giving this former government institution the respect and deference it deserves by focusing on past quarterly profits and burying the bad news in the last paragraph:
Japan Tobacco Oct-Dec Group Net Profit Grows To Y70.8bn
TOKYO (Dow Jones)–Japan Tobacco Inc. (2914) Thursday reported that its group net profit for the October-December quarter rose 12% on year, following a cigarette price hike in Japan as well as continued strength in overseas tobacco sales.
The world’s third-largest tobacco company, commonly known as JT, said its group net profit grew to Y70.8 billion from Y63.0 billion a year earlier.
Group revenue rose 4.7% to Y1.260 trillion from Y1.204 trillion, while its group operating profit rose 10% to Y95.6 billion in the just-ended quarter.
For the full fiscal year ending March, JT issued a profit warning due to fundraising-related costs to buy U.K. tobacco maker Gallaher Group PLC. The deal, valued at GBP9.75 billion, would be the biggest acquisition of a foreign firm by a Japanese company.
For the current fiscal year ending March, JT lowered its group pretax profit outlook to Y298 billion from Y310 billion. It also revised down its group net profit forecast to Y202 billion from Y206 billion
Despite the Nikkei’s best efforts however, JT shares dipped 3.7% on the news, the FT tells us (with the benefit of 2 days’ hindsight, granted).