PT Indosat Tbk 1H 2014 Results · 2015-11-12 · Telkomsel • Network ... data services and...
Transcript of PT Indosat Tbk 1H 2014 Results · 2015-11-12 · Telkomsel • Network ... data services and...
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PT Indosat Tbk 1H 2014 Results
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Agenda
Financial and Operational Highlights
Management Focus and Key Updates
Supplemental Information
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Financial and Operational Highlights
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1H14 YoY Overview
Consolidated Revenue decreased 0.8% to IDR 11,613 billion
EBITDA decreased 5.3% to IDR 5,032 billion, EBITDA Margin of 43.3%
Profit Attributable to Owners of The Company increased to IDR 226 billion
Free Cash Flow increased to IDR 2,195 billion
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2Q14 QoQ Overview
Consolidated Revenue increased 1.2% to IDR 5,840 billion
EBITDA decreased 7.3% to IDR 2,421 billion, EBITDA Margin of 41.5%
Profit Attributable to Owners of The Company decreased to a loss of IDR 574 billion
Free Cash Flow decreased to IDR 876 billion
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Financial Highlights
11,708 Operating Revenue
EBITDA
EBITDA Margin
Profit /Loss Attributable to Owners of the Company
11,613
1H-13 1H-14 YoY
-0.8%
5,311 5,032 -5.3%
45.4% 43.3% -2.0ppt
-231 226 197.9%
5,773 5,840
1Q-14 2Q-14 QoQ
1.2%
2,611 2,421 -7.3%
45.2% 41.5% -3.7ppt
800 -574 -171.1%
in IDR billion
• Improved revenue growth QoQ. • EBITDA margin YTD in line with guidance.
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780 820 833 833 861 845
257 280 350 328 261 281
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Segment Revenue Overview
Operating Revenue Breakdown
in IDR billion
1Q-14
+1.2% QoQ -1.4% YoY
2Q-14
5,773 6,056
4Q-13 3Q-13 2Q-13 1Q-13
Cellular
Fixed Data
Fixed Voice
7.9% / 0.6%
-1.9% / 3.0%
1.4% / -2.2%
• Improved cellular performance after network modernization expected to be seen in 2H14 • Continued strong demand for fixed data services & connectivity
QoQ / YoY 5,788 5,920 6,091
4,908 4,820 4,751 4,651 4,895 4,714
5,840
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Cellular revenue performance
Voice
SMS
Data
VAS
-6.4%
2Q14 YoY
1.5%
11.0%
72.1%
2.4%
2Q14 QoQ
1.9%
-0.9%
26.7% Improved execution and performance in VAS
Migration to data continued to impact voice usage
Higher effective SMS rate paid
Significant traffic increase in the modernized network; focus on data customer acquisition
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55.9 56.5 53.8
59.6 59.7 54.9
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Cellular customer base
2Q-14
-2.7% YoY -8.1% QoQ
1Q-14 4Q-13 3Q-13 2Q-13 1Q-13
Number of cellular customers
in million
2Q-14 1Q-13 1Q-14 4Q-13 3Q-13 2Q-13
Net customer additions
in million
• Rotational churn from 4Q13 and 1Q14 acquisition campaigns
-2.5
0.5
-2.7
5.8
0.1
-4.8
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95 92 96 89
79 80 127 136 133 137 140 143
16.0 15.2 15.6 14.8 13.5 13.6
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ARPU stable
Voice traffic and MOU
-10.9% YoY
2Q-14
+0.4% QoQ
1Q-14 4Q-13 3Q-13 2Q-13 1Q-13
Voice Traffic
in billion minutes in minute/subscriber
MOU
• ARPU stable on improved pricing environment • Voice traffic continued to migrate to data (VoIP)
ARPU and ARPM
26.5 27.3 28.5 27.7 25.8 26.6
1Q-14 4Q-13 3Q-13 2Q-13 1Q-13
+3.1% QoQ -2.7% YoY
2Q-14
ARPU
in thousand IDR (ARPU) in IDR (ARPM)
ARPM
in IDR/minute
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67 69 71
67 60 61
5,257 5,904 6,485
12,871
15,372
19,185
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High data usage growth
Data usage
in TByte
+24.8% QoQ +224.9% YoY
2Q-14 1Q-14 4Q-13 3Q-13 2Q-13 1Q-13
SMS delivered
in billion
-11.7% YoY
2Q-14 1Q-14
+1.8% QoQ
4Q-13 3Q-13 2Q-13 1Q-13
• Modernized network enabling greater data experience and data usage growth • Increased focus on monetization in 2H14
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Operational expenses
Cost of Service (CoS)
Depreciation and Amortization
Personnel
Marketing
as percentage of revenue
General and Administration
Total Expenses
1Q-13 2Q-13
• CoS increased due to higher network operational costs. • Increased go to market expenses following completion of modernization in Java • D & A declining in line with expectation and guidance
Total Operating Expenses
4Q-13
41.2%
36.5%
7.0%
3.7%
2.8%
91.2%
54.7%
3Q-13
41.6%
37.0%
7.2%
2.9%
2.8%
91.5%
54.6%
41.7%
37.8%
6.8%
4.2%
3.7%
94.2%
56.4%
42.4%
38.9%
8.6%
4.0%
5.2%
99.1%
60.2%
1Q-14
41.4%
34.4%
7.2%
2.8%
3.4%
89.2%
54.8%
2Q-14
43.4%
33.6%
7.3%
3.6%
4.1%
92.2%
58.5%
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2,629 2,682 2,655 2,410 2,611 2,421
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Overall stable EBITDA
EBITDA and EBITDA margin
-7.3% QoQ -9.7% YoY
2Q-14 1Q-14 4Q-13 3Q-13 2Q-13 1Q-13
EBITDA
in IDR billion
45.3% 45.4%
EBITDA Margin
• YTD EBITDA margin in line with guidance
43.6% 39.8%
45.2% 41.5%
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Normalized net profit bridge
-180 -231
226 226 236 286
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310
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Normalized net profit*
Net profit
+197.9% YoY -28.1% YoY
1H-14 1H-13 1H-12
in IDR billion in IDR billion 1H-14
• Net profit up on positive FX and sale of TBIG shares
Normalized Net– FX
Loss
Reported
* Net profit is Profit Attribution to Owners of the Company
Change in
Useful Life
Sale TBIG
Shares
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2.72
2.17
2.54
27,099 23,931
25,598
2.23
2.01
2.32
22,224 22,133 23,379
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Balance sheet
Gross debt* and gross debt/EBITDA Net debt* and net debt/EBITDA
1H-13 1H-12 1H-14
+7.0% YoY
Gross Debt
in IDR billion
Gross Debt/EBITDA
1H-14 1H-12 1H-13
+5.6% YoY
Net Debt Net Debt/EBITDA
in IDR billion
• Debt level stable, weakening IDR YoY increased debt level.
* IDR 3.8tn and IDR 3.4tn of obligation under finance lease are included in 1H13 and 1H14 respectively
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45.1 46.5 41.3
24.0 27.5 28.6
2,612 2,750 2,516
1,452 1,590 1,669
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Free Cash Flow & Capex
Free cash flow
in IDR billion
-499
390 479
-1,045
1,319 876
2Q-14 1Q-14 4Q-13 3Q-13 2Q-13 1Q-13
Capex and Capex/Revenue
2Q-14 1Q-14 4Q-13 3Q-13 2Q-13 1Q-13
Capex
in IDR billion
Capex/Revenue
• Free cash flow positive in 2Q14 due to higher generated operating cash.
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452 389
426
276 233 226
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Network Development
Number of BTS
17,452 17,668 18,214 18,871 19,892 20,585
4,645 4,781 4,993 5,409 6,363 13,328
+29.2% QoQ +51.1% YoY
2Q-14
22,097
1Q-14 4Q-13 3Q-13 2Q-13 1Q-13
2G 3G
Cellular Revenue per BTS
In IDR million
1H 2014 1H 2013
XL
Indosat
Telkomsel
• Network modernization completed for key cities in Java + Bali. • Modernization outside of Java to be finalized soon.
22,449 23,207 24,280 26,255
33,913
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Q2 in summary
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Management Focus and Key Updates
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Developing adjacent and new businesses
People and culture
Improving cost efficiencies to enable investments for growth
Driving strong uptake, usage, monetization of our data services and developing our data ecosystem
Executing well on network modernization to improve network quality and customer experience
Our Focus
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Digital Business Snapshot
Commercial
Partnerships
Dedicated
Digital Unit
Incubation and Investments
Incubator Venture Fund
• Invest in innovative apps
and startups to capture
value beyond arpus
• Secure growth from
adjacent businesses
• Stimulate data
ecosystem through
enabling platforms
• Grow data revenue
through commercial
partnerships
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2
3
Driver Pillar Execution
Influential global partners (Telco Operators and OTT players)
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2014 Guidance
FY 2013 Actual FY 2014 Guidance
Consolidated Revenue Growth 6.4% Low single digit
EBITDA Margin 43.5% Low-Mid 40’s
Cash CAPEX IDR 9.33 trillion IDR 8-9 trillion
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Thank You
Any further questions?
Upcoming events 9M – 2014 Results
Indosat Investor Relations Jl. Medan Merdeka Barat No. 21 Jakarta - 10110 Tel: +62 21 30442615 [email protected]
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Disclaimer
• 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
• Please be also advised that the information provided herein are merely issued to coincide with the release of Ooredoo QSC (formerly known as Qatar Telecom QSC) results for the year ended 31 December 2013, as the Company’s indirect majority shareholder that consolidates Indosat’s results in its financial statements. Subject to the completion of, including but not limited to the audit by the Public Accountant Firm on the Company’s consolidated financial statements which are prepared in accordance with the Indonesian Financial Accounting Standards (IFAS), Indosat expects to file and release its consolidated financial statements for the year ended 31 December 2013 on 30 April 2014 at the latest (“Indosat’s Official Release”). Accordingly, the information provided herein may differ from what is contained in Indosat's Official Release.
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Supplemental Information
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Credit ratings maintained
On 2 April 2014: Fitch Ratings has affirmed PT Indosat Tbk's (Indosat) Long-Term Foreign- and Local-Currency Issuer Default Ratings (IDR) at 'BBB'. The agency has also affirmed the Indonesia-based company's National Long-Term Rating at 'AAA(idn)'. The Outlook is Stable on the IDR and the National Long-Term Rating. Fitch has also affirmed the foreign-currency senior unsecured rating of 'BBB'.
On 14 July 2014, Standard and Poor’s (“S&P”) has affirmed its rating and outlook on PT Indosat Tbk. (BB+/Stable/NR; axBBB+/--). The stable outlook reflects the outlook on the sovereign credit rating on Indonesia (BB+/Stable/B; axBBB+/axA-2). S&P says that Indosat has adequate cushion in its covenants to absorb a more than 15% decline in EBITDA and Indosat has good financial flexibility due to its strategic relationship with parent Ooredoo, good banking relationships, and access to local and global financial markets.
On 12 March 2014, PEFINDO has affirmed its “idAA+” ratings for PT Indosat Tbk (ISAT) and its Bonds V/2007 Serie B, Bonds VI/2008 Serie B, Bonds VII/2009, and Bonds VIII/2012. PEFINDO has also affirmed the “idAA+(sy)” ratings for ISAT’s Sukuk Ijarah IV/2009 and Sukuk Ijarah V/2012. PEFINDO likewise affirmed its ratings of “idAA+” and “idAA+(sy)” for the Company’s IDR1.23 trillion Bonds V/2007 Serie A and IDR0.4 trillion Sukuk Ijarah II/2007, respectively, which will be internally financed upon their maturity on 29 May 2014. The outlook for the rating is “stable”.
On 4 March 2014, Moody's Investors Service says that PT Indosat Tbk's operating performance for
FY2013 was weaker than expected, but can be accommodated within its Ba1 rating with a stable
outlook.
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Debt maturity profile
Debt maturity profile*
In IDR trillion
0.41 0.83 0.74 0.48 0.24 0.24
7.78
0.83
3.27
1.92 1.52 0.50 1.50
1.50
2020 2019 2018 2014 2022 2017 2016 2015
IDR
USD in IDR
* Excluding obligation under capital lease
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Spectrum overview for top 4 cellular operators
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
3.6
850 Mhz
5.0 – 7.5*
-
-
* Telkom and Bakrie Telekom have the same spectrum, differentiated by its operational areas
15.0**
2300 Mhz
15.0**
-
-
** Indosat: West Java Area ; Telkom/Telkomsel: Central & East Java, Papua, North Sulawesi