Softbank Group reported its worst-ever annual loss, as write-offs on key investments led to a loss of JPY1.9 trillion ($17.7 billion) in its Vision Fund.
The company booked a net loss of JPY961.6 billion in its fiscal 2019 ending 31 March, compared with a JPY1.41 trillion profit in fiscal 2018. At the end of April, the company warned its loss would widen [1] to about JPY900 billion, up from its previous estimate of JPY750 billion.
Total revenue in fiscal 2019 rose 1.5 per cent year-on-year to JPY6.2 trillion.
On 13 April, the company announced it expected to book a JPY1.8 trillion loss [2] from its troubled Vision Fund. Sharp share price declines in the fund’s portfolio meant the value of its holdings in Uber fell by about $5.2 billion and in WeWork by about $4.6 billion, Bloomberg reported.
In a statement, SoftBank said its high-profile Vision Fund, with investments in 88 start-ups, had been “adversely affected” by the Covid-19 (coronavirus) crisis.
The company also reported losses of JPY670 billion from its own investments, including WeWork and satellite operator OneWeb, which filed for bankruptcy in March.
SoftBank said it plans to spend up to JPY500 billion to buy back shares in fiscal 2020.
Board changes
The company also announced Alibaba co-founder Jack Ma will resign from its board at its AGM on 25 June and proposed three new appointments, expanding the board to 13.
The candidates are CFO Yoshimoto Goto; Tan Lip-Bu, CEO of chip design software company Cadence Design Systems; and Yuko Kawamoto, a professor at Waseda Business School.
[1] https://www.mobileworldlive.com/asia/asia-news/softbank-forecasts-wider-loss-on-wework-write-off/
[2] https://www.mobileworldlive.com/featured-content/top-three/softbank-predicts-heavy-loss-as-vision-fund-slumps/
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