PT Indosat Tbk FY 2014 Results · 2015-11-12 · Indosat Presentation FY 2014 Results 4 4Q14 QoQ...
Transcript of PT Indosat Tbk FY 2014 Results · 2015-11-12 · Indosat Presentation FY 2014 Results 4 4Q14 QoQ...
PT Indosat Tbk FY 2014 Results
2 Indosat Presentation FY 2014 Results
Agenda
Financial and Operational Highlights
Management Focus and Key Updates
Supplemental Information
3
Financial and Operational Highlights
4 Indosat Presentation FY 2014 Results
4Q14 QoQ Overview
Consolidated Revenue increased 4.3% to IDR 6,368 billion
EBITDA decreased 4.3% to IDR 2,459 billion, EBITDA Margin reached 38.6%
Loss Attributable to Owners of The Company increased to a loss of IDR 664 billion
Free Cash Flow decreased to IDR -206 billion
5 Indosat Presentation FY 2014 Results
FY14 YoY Overview
Consolidated Revenue increased 1.0% to IDR 24,085 billion
EBITDA decreased 3.1% to IDR 10,059 billion, EBITDA Margin reached to 41.8%
Loss Attributable to Owners of The Company decreased to loss IDR 1,987 billion
Free Cash Flow increased to IDR 2,345 billion
6 Indosat Presentation FY 2014 Results
Financial Highlights
Operating Revenue
EBITDA
EBITDA Margin
Profit /Loss Attributable to Owners of the Company
24,085
FY-13 FY-14 YoY
1.0%
10,059 -3.1%
41.8% -1.7ppt
-1,987 28.6%
6,368
3Q-14 4Q-14 QoQ
4.3%
2,459 -4.3%
38.6% -3.5ppt
-664 -215.3%
in IDR billion
• Continued strong momentum on QoQ revenue growth. • EBITDA margin pressures due to higher operational costs related to network expansions.
23,855
10,376
43.5%
-2,782
6,104
2,569
42.1%
-211
7 Indosat Presentation FY 2014 Results
833 833 861 845 887 916
350 328 261 281 292 262
Segment Revenue Overview
Operating Revenue Breakdown
in IDR billion
2Q-14
+4.3% QoQ +5.1% YoY
3Q-14
5,840 5,773
1Q-14 4Q-13 3Q-13
Cellular
Fixed Data
Fixed Voice
-10.2% / -20.1%
+3.3% / +10.0%
+5.4% / +6.0%
• Cellular revenue continued its momentum in 4Q14 driven by network modernization. • Continued strong demand for fixed data services and connectivity.
QoQ / YoY 6,091 6,056
4,895 4,908 4,714 4,651 4,925
6,104
4Q-14
5,190
6,368
8 Indosat Presentation FY 2014 Results
Cellular revenue performance
Voice
SMS
Data
VAS
-5.0%
4Q14 YoY
-9.0%
63.9%
50.9%
0.4%
4Q14 QoQ
-6.3%
25.0%
-0.5% Various Gaming & Content packages pushed number of VAS user
Migration to data continued to impact voice usage which SMS usage was impacted the most
Increase data usage as respond to attractive data offer
9 Indosat Presentation FY 2014 Results
53.8 59.6 59.7
54.9 54.2
63.2
Cellular customer base
3Q-14
+6.1% YoY +16.6% QoQ
2Q-14 1Q-14 4Q-13 3Q-13
Number of cellular customers
in million
3Q-14 2Q-14 1Q-14 4Q-13 3Q-13
in million
• Aggressive customer acquisition campaigns during 4Q to leverage improved network quality perception
-2.7
5.8
0.1
-4.8
-0.7
9.0
4Q-14 4Q-14
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96 89
79 80 78 78 133 137 140 143 148 142
15.6 14.8 13.5 13.6 13.1 13.6
ARPU stable
Voice traffic and MOU
-8.2% YoY
3Q-14
+4.1% QoQ
2Q-14 1Q-14 4Q-13 3Q-13
Voice Traffic
in billion minutes (Voice Traffic) in minute/subscriber (MOU)
MOU
• ARPU stable despite significant increase in number of customers. Quality customers remained intact
ARPU and ARPM
28.5 27.7 25.8 26.6 28.3 28.0
2Q-14 1Q-14 4Q-13 3Q-13
-1.0% QoQ +1.2% YoY
3Q-14
ARPU
in thousand IDR (ARPU) in IDR (ARPM)
ARPM
4Q-14 4Q-14
11 Indosat Presentation FY 2014 Results
71 67 60
61 57 59
6,485
12,871 15,372
19,185 20,911
29,891
Strong data usage
Data usage
in TByte
+42.9% QoQ +132.2% YoY
3Q-14 2Q-14 1Q-14 4Q-13 3Q-13
SMS delivered
in billion
-12.2% YoY
3Q-14 2Q-14
+2.7% QoQ
1Q-14 4Q-13 3Q-13
• Modernized network resulted in better data experience pushed data revenue growth
4Q-14 4Q-14
12 Indosat Presentation FY 2014 Results
Operational expenses
Cost of Service (CoS)
Depreciation and Amortization
Personnel
Marketing
as percentage of revenue
General and Administration
Total Expenses
• Higher Cost of Services due to expanding network • Increased go-to-market expenses and escalated network quality perception
Total Operating Expenses
4Q-13 3Q-13
41.7%
37.8%
6.8%
4.2%
3.7%
94.2%
56.4%
42.4%
38.9%
8.7%
4.0%
5.1%
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%
116.7%
58.5%
3Q-14
42.7%
33.4%
7.4%
4.9%
3.0%
91.3%
57.9%
Provision for IM2 Legal Case 23.5%
4Q-14
45.2%
35.1%
6.6%
5.9%
3.8%
96.5%
61.4%
13 Indosat Presentation FY 2014 Results
2,655 2,410
2,611 2,421 2,569 2,459
EBITDA Performance
EBITDA and EBITDA margin
-4.3% QoQ +2.0% YoY
3Q-14 2Q-14 1Q-14 4Q-13 3Q-13
EBITDA
in IDR billion
43.6%
EBITDA Margin
• FY14 EBITDA margin in line with guidance • A lag between revenue generation and
operational cost disbursement after network expansion impacted EBITDA result
39.8%
45.2% 41.5% 42.1%
38.6%
4Q-14
14 Indosat Presentation FY 2014 Results
Normalized net loss bridge
375
-2,782
-1,987 -1,987
-123
Normalized net profit*
Net profit
-28.6% YoY -841.7% YoY
FY-14 FY-13 FY-12
in IDR billion in IDR billion FY-14
• FY2014 net loss impacted mainly by IM2 provision
Normalized Net–
FX Loss
Reported
* Net profit is Profit Attribution to Owners of the Company
Change in
Useful Life
Sale
TBIG
Shares
547
373 414
1,359
Provision
IM2 Legal
Contingency
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2.43 2.70
2.72
25,598 28,052 27,346
2.06
2.49 2.37
21,680 25,819 23,866
Balance sheet
Gross debt* and gross debt/EBITDA Net debt* and net debt/EBITDA
FY-13 FY-12 FY-14
-2.5% YoY
Gross Debt
in IDR billion
Gross Debt/EBITDA
FY-14 FY-12 FY-13
-7.6% YoY
Net Debt Net Debt/EBITDA
in IDR billion
• Slightly lower debt level YoY despite Rupiah depreciation
* IDR 3.6tn and IDR 3.6tn of obligation under finance lease are included in FY13 and FY14 respectively
16 Indosat Presentation FY 2014 Results
41.3
24.0 27.5 28.6
25.7 25.4 2,516
1,452 1,590 1,669 1,566 1,618
Free Cash Flow & Capex
Free cash flow
in IDR billion
479
-1,045
1,319 876
356
-206
3Q-14 2Q-14 1Q-14 4Q-13 3Q-13
Capex and Capex/Revenue
3Q-14 2Q-14 1Q-14 4Q-13 3Q-13
Capex
in IDR billion
Capex/Revenue
• Positive free cash flow generated in FY2014 • 4Q14 negative free cash flow due to higher payment to suppliers
4Q-14
4Q-14
17 Indosat Presentation FY 2014 Results
846 767 798
484 442 425
Network Development
Number of BTS
18,214 18,871 19,892 20,585 21,420 22,166
4,993 5,409 6,363
13,328 15,962
18,063
+7.6 QoQ +65.7% YoY
3Q-14 2Q-14 1Q-14 4Q-13 3Q-13
2G 3G
Cellular Revenue per BTS
In IDR million
FY 2014 FY 2013
XL
Indosat
Telkomsel
• Network modernization completed for key cities in Indonesia • Completing network modernization for surrounding cities in Mid-2015
23,207 24,280 26,255
33,913 37,382
4Q-14
40,229
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Q4 in summary
Management Focus and Key Updates
20 Indosat Presentation FY 2014 Results
Develop adjacent and new businesses
Increase cost efficiencies to enable investments for growth
Improve monetization of the strong growth in data users and traffic
Leverage modernized network and improved customer experience to drive revenue growth
Our Focus
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2015 Guidance
FY 2014 Actual FY 2015 Guidance
Consolidated Revenue Growth 1.0% In line with market
EBITDA Margin 41.8% Low to Mid 40’s
Cash CAPEX IDR 6.4 trillion IDR 6.5 - 7.5 trillion
22 Indosat Presentation FY 2014 Results
Thank You
Any further questions?
Upcoming events 1Q - 2015 Results
Indosat Investor Relations Jl. Medan Merdeka Barat No. 21 Jakarta - 10110 Tel: +62 21 30442615 [email protected]
23 Indosat Presentation FY 2014 Results
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.
Supplemental Information
26 Indosat Presentation FY 2014 Results
IM2 case development
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”).
In conjunction with the Supreme Court’s decision on the litigation case, the
Company recognized a provision for the litigation case amounting to
Rp1,358,643,346,674,- (including the penalty imposed on Mr. Indar
Atmanto) in the consolidated financial statements of the Group as of
December 31, 2014.
27 Indosat Presentation FY 2014 Results
Credit ratings improved Upgrade to AAA by Pefindo
On 7 January 2015, Standard and Poor’s (“S&P”) has affirmed its rating and outlook on Indosat (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 expects Indosat's operating performance to remain stable over the next two years, given the company's focus on the data business. S&P assess Indosat's liquidity as "adequate" because the company's sources of liquidity are likely to cover its needs by more than 1.2x in the 12 months to Sept. 30, 2015.
On 5 November 2014, PEFINDO has raised its ratings for Indosat and its Bonds V/2007 Serie B, Bonds VI/2008 Serie B, Bonds VII/2009 Serie B, and Bonds VIII/2012 to “idAAA” from “idAA+”. PEFINDO has also raised its ratings for ISAT’s Sukuk Ijarah IV/2009 Serie B and Sukuk Ijarah V/2012 to “idAAA(sy)” from “idAA+(sy)”. The outlook for the corporate rating is “stable”. PEFINDO has also assigned “idAAA” and “idAAA(sy)” ratings for the proposed IDR9 trillion Shelf Registration Bond I/2014-2016 and IDR1 trillion Sukuk Ijarah I/2014-2016 of Indosat respectively.
On 13 February 2015, Moody's Investors Service says that for the nine months ended September
2014, Indosat's results were weaker than expected but can be accommodated within its Ba1 rating
with a stable outlook.
On 2 April 2014: Fitch Ratings has affirmed Indosat Long-Term Foreign and Local-Currency Issuer Default Ratings (IDR) at 'BBB'. The agency has also affirmed the Indonesia-based Indosat'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 5 September 2014 Fitch has reaffirmed the Indonesia-based Indosat's unsecured National Long-Term Rating at 'AAA(idn)‘ and the upcoming National Long-Term Ratings on its IDR9trn bond programme and IDR1trn sukuk ijarah programme at “AAA(idn)‟.
28 Indosat Presentation FY 2014 Results
Debt maturity profile
Debt maturity profile*
In IDR trillion
2019 2018 2022 2017 2016 2015
IDR
USD in IDR
* Excluding obligation under capital lease
2021
8.95
0.77 0.49 0.25 0.25
2.92
1.67 2.98 0.50 2.27
0.36 1.50 0.36
2024
29 Indosat Presentation FY 2014 Results
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
2.5
850 Mhz
3.5 – 5.0*
-
-
* 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