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November 16, 2005 5:00 pm

TBS downbeat as advert bookings slacken

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TBS, the Japanese TV broadcaster, on Wednesday unveiled a 50 per cent drop in interim pre-tax profits and said its full-year results would be lower than it previously forecast due to sluggish demand for spot advertising, costs associated with its baseball team and lower contributions from subsidiaries.

The disappointing outlook will provide a boost to internet shopping group Rakuten’s claims that TV broadcasters face a challenging business environment and need to rethink their current business model.

Rakuten, which is proposing a merger with TBS, has warned that TV advertising revenues are likely to become increasingly depressed due to the spread of the internet and new technologies.

In the six months to September, TBS’s pre-tax recurring profits fell to Y5.67bn ($47.6m) from Y11.34bn in the same period last year, when its advertising revenues were boosted by the Athens Olympics.

However, net profits were up 64 per cent at Y12.57bn because of the sale of
shares in a chipmaker, Tokyo Electron.

TBS said full-year revenues would be 19 per cent lower than previously forecast, at Y14.5bn, while net profits would be 9 per cent lower at Y17.7bn.

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