PT. Indosat Tbk. · 2016-08-09 · PT Indosat Tbk – 1H 2016 Results 3 Revenue growth 4.6% growth...

PT. Indosat Tbk.

First Half 2016 Results

2 PT Indosat Tbk – 1H 2016 Results


Revenue growth 4.6% growth QoQ

Cellular Revenue growth 4.2% growth for QoQ

Data Traffic growth 46.3% growth QoQ 83.5% growth YoY

Indosat Ooredoo Juara

Data Revenue growth 20.1% growth QoQ 55.5% growth YoY

Voice & SMS Revenue growth 5.7% growth YoY


Moving into LTE

40 Cities, 43 million population coverage

Jakarta

Bogor

Depok

Bekasi

Tangerang

Karawang

Bandung

Tasikmalaya

Sukabumi

Cianjur

Yogyakarta

Semarang

Solo

Purwokerto

Salatiga

Demak

Rembang

Kudus

Magelang

CIlacap

Surabaya

Malang

Mojokerto

Tuban

Gresik

Bojonegoro

Sidoarjo

Kediri

Denpasar

Badung (Kuta

/ Nusa Dua)

Padang

Bukittinggi

Batam

Lampung

Metro

Pontianak

Balikpapan

Samarinda

Banjarmasin

Makassar

Indosat Ooredoo Business

Services

6

3 Stream of Services

PT Indosat Tbk – 1H 2016 Results

Business is coming from Large Enterprise customer with focus on fixed connectivity & internet

and IT Services.

In the last 2 years, we develop B2B mobile business which related to mobile data connectivity

and application.

Fixed Connectivity

Leased Circuit

Ethernet Link

IPVPN

Fixed Internet

IP Transit

Dedicated Internet Access

IT Services

Data Center

Cloud Infrastructure as-a-Service

Disaster Recovery Center 3

7

Our business transformation journey is moving

towards being “Indonesia’s Leading Digital Telco”


Financial and

Operational Highlights

9

1H16 YoY Overview

Consolidated Revenue increased 10.5% from IDR 12,620 billion to IDR 13,942 billion

EBITDA increased 12.6% from IDR 5,362 billion to IDR 6,040 billion, EBITDA Margin reached 43.3%

Profit Attributable to Owners of The Parent increased from a loss of IDR 734 billion to a profit of IDR 428 billion

Free Cash Flow decreased from IDR 1,792 billion to IDR 1,340 billion


10

2Q16 QoQ Overview

Consolidated Revenue increased 4.6% from IDR 6,813 billion to IDR 7,129 billion

EBITDA increased 4.0% from IDR 2,961 billion to IDR 3,080 billion, EBITDA Margin reached 43.2%

Profit Attributable to Owners of The Parent slightly decreased from IDR 217 billion to IDR 211 billion

Free Cash Flow increased from IDR 463 billion to IDR 877 billion


Operating Revenue

EBITDA

EBITDA Margin

Profit (Loss)Attributable to Owners of the Parent

13,942

1H-15 1H-16 YoY

10.5%

6,040 12.6%

43.3% 0.8ppt

428 158.3%

7,129

1Q-16 2Q-16 QoQ

4.6%

3,080 4.0%

43.2% -0.3ppt

211 -2.9%

in IDR billion

12,620

5,362

42.5%

-734

Financial Highlights

11

• Double digit Revenue and EBITDA growth YoY in 2 consecutive quarters supported by growth in all services (voice, SMS, data dan VAS).

• Positive bottom line maintained in line with stabilized currency and reduction of USD debt portion.

6,813

2,961

43.5%

217


936 921 997 909 989

271 272 286 228

226

in IDR billion +4.6% QoQ +9.2% YoY

Cellular Fixed Data Fixed Voice

-1.0% / -16.5%

+8.9% / +5.7%

+4.2% / +11.2%

QoQ / YoY

2Q-15

5,321

3Q-15

5,768

6,527

Operating Revenue Breakdown

5,904

6,962

Segment Revenue Overview

4Q-15

7,187

12

5,676

6,813

1Q-16

• Strong data cellular revenue continue to grow and surpass traditional cellular services. • IDR appreciation drove IDD revenue down and eventually brought down Fixed voice

revenue QoQ and YoY.


2Q-16

5,914

7,129

Voice

SMS

Data

VAS

5.2%

1H16 YoY

6.4%

55.5%

23.1%

0.9%

2Q16 QoQ

-3.6%

20.1%

30.8% Digital business initiatives had pushed VAS revenue growth

Cellular Revenue Performance

13

- Healthy growth in all services YoY - Data took the lead in driving the cellular

revenue growth


68.5 69.0 69.7 69.8

80.5

2Q-15

+17.3% YoY +15.3% QoQ

Number of cellular customers in million

2Q-15

in million

2.0

0.5 0.8

0.1

10.7

3Q-15 3Q-15

Net cellular customers additions

• A combination of data campaign and specific marketing program for ex-Java market had taken the momentum in Ramadhan month

4Q-15 4Q-15

Cellular Customer Base

14

1Q-16 1Q-16


2Q-16 2Q-16

ARPU and ARPM Voice Traffic and MOU

• ARPU growth maintained YoY in line with data users growth. • Voice traffic was growing due to our expansion in outside of Java area continues.

67 70 76 69 71

145 143 135 137

126

13.5 14.6 15.6 14.5 15.6

+15.8% YoY

2Q-15

+7.7% QoQ

Voice Traffic

in billion minutes (Voice Traffic)

in minute/subscriber (MOU)

MOU

25.3 26.9 27.9 26.4 25.5

-3.4% QoQ +0.9% YoY

2Q-15

ARPU

in thousand IDR (ARPU)

ARPM

3Q-15 3Q-15 4Q-15 4Q-15

in IDR (ARPM)

Improving ARPU

15

1Q-16 1Q-16


2Q-16 2Q-16

Data Usage SMS Delivered

• 4G traffic started to drive data usage growth • SMS declined due shifting trend toward messaging application started to be seen.

60 62 59

52 55

46,027 55,871 57,276

63,987

93,641

in TByte

+46.3% QoQ +103.4% YoY

2Q-15

in billion

-7.8% YoY +5.6% QoQ

3Q-15 2Q-15 4Q-15 3Q-15

Strong Data Usage

4Q-15

16

1Q-16 1Q-16


2Q-16 2Q-16

• Moderated operational expenses • Marketing ratio was higher due to Ramadhan campaign

Cost of Service (CoS)

Depreciation and Amortization

Personnel

Marketing

as percentage of revenue

General and Administration

Total Expenses

Total Operating Expenses

2Q-15

42.1%

32.2%

6.9%

4.6%

4.2%

89.9%

57.7%

3Q-15

40.5%

29.8%

6.8%

3.8%

2.9%

83.8%

54.0%

Operational expenses

4Q-15

42.1%

35.1%

7.6%

6.8%

3.0%

94.7%

59.6%

17

1Q-16

40.4%

32.6%

7.8%

4.7%

3.7%

89.1%

56.5%


2Q-16

41.4%

31.3%

7.3%

4.9%

3.2%

88.1%

56.8%

2,758 3,205 2,906 2,961 3,080

EBITDA and EBITDA margin

+4.0% QoQ +11.7% YoY

EBITDA

in IDR billion

EBITDA Margin

2Q-15

EBITDA performance is supported by strong revenue growth combined with strict cost management initiatives.

3Q-15

42.3% 46.0%

EBITDA performance

4Q-15

40.4%

18

43.5%

1Q-16


2Q-16

43.2%

Net profit

• Strong revenue growth, good cost management and stabilized currency resulted in positive net profit

-1,117

-734

428

+158.3% YoY +34.3% YoY

1H-16 1H-15 1H-14*

in IDR billion

* Restated due to implementation of PSAK 24 (revised 2013) effective 1 January 2015

Net profit


2.54

3.13

2.03

25,598

32,437

24,690

2.32 2.22

1.85

23,379 23,017 22,438

Gross debt* and gross debt/EBITDA Net debt* and net debt/EBITDA

• Gearing level continuously improved • US debt portion has come down to 14% level

* IDR 3.84tn, IDR 4.05tn and IDR 3.61tn of obligation under finance lease are included in 1H14, 1H15 and 1H16 respectively

1H-15 1H-14 1H-16

-23.9% YoY

Gross Debt

in IDR billion

Gross Debt/EBITDA

1H-16 1H-14 1H-15

Net Debt Net Debt/EBITDA

in IDR billion

Balance sheet

-2.5% YoY


21.0

26.8

37.6

24.4

29.7

1,372 1,869

2,699

1,663

2,117

Free cash flow Capex and Capex/Revenue

• FCF strengthening with improved operating CF generation and moderating capex • Capex disbursement is in line with guidance toward end of year.

in IDR billion

1,310 837

-1,067

463 877

2Q-15*

2Q-15

Capex

in IDR billion

Capex/Revenue 3Q-15*

3Q-15

4Q-15*

4Q-15

Free cash flow & Capex

21

1Q-16

1Q-16

in %


2Q-16

2Q-16

* Reclassification from repayment of obligation under finance lease

Number of BTS Data User

• Strong network performance to support data service. • Data users is steadily growing.

22,902 23,525 23,596 23,714 23,793

20,067 22,671 23,730 25,068 25,816

106 165 3,361 3,544 3,724

+1.9% QoQ +23.8% YoY

1Q-16

2G 3G

In million

2Q-15

52,326

3Q-15

43,075 46,361

2Q-15 3Q-15 4Q-15

30.1 32.2 34.0 31.2

35.1

+12.5% QoQ +16.6% YoY

Network & Data User

4Q-15

50,687

4G

22

1Q-16


2Q-16

53,333

2Q-16

Management focus

& Key updates

Management Focus

24

● Continue to transform Indosat Ooredoo to

become the leading digital telco in

Indonesia, both from a product offering

perspective as well as the way it interacts

with its stake holders

● Continue to build operational excellence

and efficiency as part of the company

culture

● To explore industry synergies to become

more efficient and effective

● To further strengthen the corporate (b2b)

offering to build a stable base through

connectivity and services.


FY 2015 Actual FY 2016 Guidance

Consolidated Revenue Growth 11.1% In line with market

EBITDA Margin* 42.9% Low to Mid 40’s

CAPEX IDR 7.3 trillion IDR 6.5 – 7.5 trillion

* Restated due to implementation of PSAK 24 (revised 2013) effective 1 January 2015

2016 Guidance


Thank You Investor Relations & Corporate Secretary Jl. Medan Merdeka Barat No. 21 Jakarta - 10110 Tel: +62 21 30442615 [email protected]

Supplemental

Information

On September 16, 2014, the South Jakarta Attorney Office (“Kejaksaan

Negeri Jakarta Selatan”), without preliminary notification, executed the

Supreme Court’s Decision on Mr. Indar Atmanto. The execution was

done based on a quotation of the Supreme Court’s Decision, which

states, among others, that (i) Mr. Indar Atmanto is found guilty and

sentenced to eight years imprisonment and charged with penalty of

Rp300,000,000,- (if the penalty is not paid, Mr. Indar Atmanto would

serve an additional six months imprisonment), and (ii) IM2 pay the

losses sustained by the State amounting to Rp1,358,343,346,674,-.

Subsequently, on January 16, 2015, Mr.Indar Atmanto and/or his lawyer

or IM2 received the document on the Supreme Court’s decision

regarding the litigation case. As of the issuance date of the consolidated

financial statements, Mr. Indar Atmanto and IM2 plan to conduct further

legal act by submitting a reconsideration request peninjauan kembali

(”PK”).

On March 16, 2015, Mr. Indar Atmanto’s submission of Judicial Review

[Peninjauan Kembali (”PK”)] was officially registered at the Corruption

Court under No. 08/AKTA.PID.SUS/PK/TPK/2015/PN.Jkt.Pst.

On November 4, 2015, the Supreme Court’s official website announced

that the Judicial Review filed by Mr. Indar Atmanto was rejected based

on Supreme Court’s decision dated October 20, 2015. However, no

detailed information regarding the exact content of such Supreme

Court’s decision was available. As of the issuance date of the interim

consolidated financial statements, the official copy of such Supreme

Court’s decision hasn’t been received.

IM2 case development


On 25 January 2016, Standard & Poor's Ratings Services (“S&P”) affirmed its 'BB+‘ long-

term corporate credit rating on PT Indosat Tbk. The outlook is positive. S&P also affirmed

their 'axBBB+' long-term ASEAN regional scale rating on the Indonesia-based

telecommunications company. S&P affirmed the rating because they expect Indosat to

maintain its solid No.2 position in Indonesia's growing cellular market. The positive outlook

reflects their view that the company's financial risk profile will improve over the next 12-18

months.

On 28 September 2015, PEFINDO has affirmed its “idAAA” ratings for PT Indosat Tbk

(ISAT) and its Shelf-Registered Bond I/2014-2016, Bonds V/2007 Serie B, Bonds VII/2009

Serie B, and Bonds VIII/2012. PEFINDO has also affirmed its “idAAA(sy)” ratings for ISAT’s

Sukuk Ijarah I/2014-2016, Sukuk Ijarah IV/2009 Serie B, and Sukuk Ijarah V/2012. The

outlook for the corporate rating is “stable”. The ratings reflect ISAT’s strong support from its

majority shareholder, strong market position, and stable operating performance.

On 1 June 2016, Moody's Investors Service has affirmed Indosat Tbk. (P.T.)'s Ba1

corporate family rating. At the same time, Moody's has changed the rating outlook to

positive from stable. The change in outlook to positive reflects the substantial

improvement evident in Indosat's operational and financial profiles, with the company --

over the last four quarters -- reporting YoY revenue growth of 11%-13%, above the sector

average in Indonesia of about 9%.

On 15 March 2016, Fitch Ratings has upgraded the Long-Term Local-Currency Issuer

Default Rating (LC IDR) of Indonesia’s second-largest telecommunications operator, PT

Indosat Tbk (Indosat Ooredoo), to ‘BBB+’ from ‘BBB’. The agency has simultaneously

affirmed Indosat Ooredoo’s Long-Term Foreign-Currency IDR (FC IDR) and its foreign-

currency senior unsecured rating at ‘BBB’. Fitch has also affirmed the National Long-Term

Rating at ‘AAA(idn)’. The Outlook on the ratings is Stable.

Credit ratings


0.36 2.11

0.27 0.27

2.72

5.98

2.56 2.27

0.95 0.36 2.08

0.36 0.81

In IDR trillion

2020 2019 2022 2018 2017 2016

IDR

USD in IDR

2021 2025

* Excluding obligation under capital lease

2024

Debt maturity profile*


Number of BTS

10.0

900 Mhz

7.5

7.5

Indosat

Telkomsel

XL Axiata

20.0

1800 Mhz

22.5

22.5

10.0

2100 Mhz

15.0

15.0

in Mhz

Hutchison - 10.0 10.0

2.5

850 Mhz

4.5*

-

-

* Telkom and Bakrie Telekom have the same spectrum, differentiated by its operational areas

15.0**

2300 Mhz

15.0**

-

-

** Indosat/IM2: West Java exclude Bogor, Depok & Bekasi ; Telkom/Telkomsel: Maluku & North Maluku

Spectrum overview


• PT Indosat Tbk ( “Indosat” or “Company” ) cautions investors that certain statements contained in this document state its management's intentions, hopes, beliefs, expectations, or predictions of the future are forward-looking statements

• The Company wishes to caution the reader that forward-looking statements are not historical facts and are only estimates or predictions. Actual results may differ materially from those projected as a result of risks and uncertainties including, but not limited to:

• The Company’s ability to manage domestic and international growth and maintain a high level of customer service

• Future sales growth

• Market acceptance of the Company’s product and service offerings

• The Company’s ability to secure adequate financing or equity capital to fund our operations

• Network expansion

• Performance of the Company’s network and equipment

• The Company’s ability to enter into strategic alliances or transactions

• Cooperation of incumbent local exchange carriers in provisioning lines and interconnecting our equipment

• Regulatory approval processes

• Changes in technology

• Price competition

• Other market conditions and associated risks

• The company undertakes no obligation to update publicly any forward-looking statements, whether as a result of future events, new information, or otherwise

Disclaimer


PT. Indosat Tbk. · 2016-08-09 · PT Indosat Tbk – 1H 2016 Results 3 Revenue growth 4.6% growth...

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Transcript of PT. Indosat Tbk. · 2016-08-09 · PT Indosat Tbk – 1H 2016 Results 3 Revenue growth 4.6% growth...