Shimano shares slide after profit forecast blip

Shares in Shimano Inc., declined 5.2 percent yesterday after the japanese company trimmed its full-year profit forecast for the second time in three months on concern price competition and materials costs will reduce net income. Report on Bloomberg also features Lance Armstrong and the new EPO claims.
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Shimano Inc. declined 180 yen to 3,260 following an announcement via the Tokyo Stock Exhange that the company had revised its 2005 net income forecast to $173m, 7.8 percent lower than its May 17th estimate of $186.7m.

Profits may reduce a little but the company is still at the top of the bicycle trade's profit food chain: for the first six months of 2005, Shimano's net income rose 0.5 percent to $11.4. According to Bloomberg, the company's profit margin more than doubled from December 2001 to December 2004.

The report on also carried mention of the new 'Lance Armstrong affair', linking Shimano with Armstrong's Discovery Channel team.

"L'Equipe, a French sports newspaper, yesterday published an article headlined ``The Armstrong Lie,'' that alleged six of Armstrong's urine samples from the 1999 Tour de France showed traces of the banned hormone erythropoietin, or EPO," said Bloomberg.

After initially offering a degree of scepticism about the 1999 EPO resampling, Tour de France director is now backing L'Equipe's claims.

He said: "For the first time somebody has shown me that Armstrong in 1999 had a banned substance called EPO in his body. I was fooled. We were all fooled."

Many pro riders, including rivals who would benefit from any downgrading of the 1999 victory, have voiced their support for Armstrong.

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