Nintendo boosts profit estimates

TOKYO--Nintendo today announced that it has raised its net profit estimate for the first half of fiscal year 2004 (from April to September) from its original forecast of 25 billion yen ($225 million) up to 46 billion yen ($415 million). While the company's consolidated sales have declined 12 percent from last year down to 185 billion yen ($1.67 billion), mainly due to price cuts on its Game Boy Advance, the company's operating profits were up 39 percent to 40 billion yen ($360 million).

Nintendo has also raised its net profit forecast for the full fiscal year from 70 billion yen ($631 million) to 84 billion yen ($757 million).

A major factor that contributed to Nintendo's upward revision was the foreign exchange rate; the company keeps approximately 5 billion dollars of its assets as dollar-denominated deposits, which it revaluates at the end of each fiscal quarter. While the company had anticipated a 5 billion yen ($45 million) loss from its forecasted exchange rate of 105 yen to one dollar, the rate was 111 yen to one dollar at the end of September, which put Nintendo up 36 billion yen ($324).

For the April to September period of last year, Nintendo dipped into the red for the first time in the company's publicly traded history due to losses from foreign exchange rates.