PT Indosat Tbk FY 2014 Results

Transcription

1 PT Indosat Tbk FY 2014 Results

2 Agenda Financial and Operational Highlights Management Focus and Key Updates Supplemental Information 2

3 Financial and Operational Highlights 3

4 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 4

5 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 5

6 Financial Highlights in IDR billion FY-13 FY-14 YoY 3Q-14 4Q-14 QoQ Operating Revenue 23,855 24, % 6,104 6, % EBITDA 10,376 10, % 2,569 2, % EBITDA Margin 43.5% 41.8% -1.7ppt 42.1% 38.6% -3.5ppt Profit /Loss Attributable to Owners of the Company -2,782-1, % % Continued strong momentum on QoQ revenue growth. EBITDA margin pressures due to higher operational costs related to network expansions. 6

7 Segment Revenue Overview Operating Revenue Breakdown in IDR billion +5.1% YoY 6,091 6,056 5,773 5, % QoQ 6,104 6, QoQ / YoY -10.2% / -20.1% % / +10.0% 4,908 4,895 4,651 4,714 4,925 5, % / +6.0% 3Q-13 4Q-13 1Q-14 2Q-14 3Q-14 4Q-14 Fixed Voice Fixed Data Cellular Cellular revenue continued its momentum in 4Q14 driven by network modernization. Continued strong demand for fixed data services and connectivity. 7

8 Cellular revenue performance 4Q14 YoY 4Q14 QoQ Voice SMS -5.0% -9.0% 0.4% -6.3% Migration to data continued to impact voice usage which SMS usage was impacted the most Data 63.9% 25.0% Increase data usage as respond to attractive data offer VAS 50.9% -0.5% Various Gaming & Content packages pushed number of VAS user 8

9 Cellular customer base Number of cellular customers in million in million +6.1% YoY +16.6% QoQ Q-13 4Q-13 1Q-14 2Q-14 3Q-14 4Q-14 3Q-13 4Q-13 1Q-14 2Q-14 3Q-14 4Q-14 Aggressive customer acquisition campaigns during 4Q to leverage improved network quality perception 9

10 ARPU stable in thousand IDR (ARPU) in IDR (ARPM) ARPU and ARPM Voice traffic and MOU in billion minutes (Voice Traffic) in minute/subscriber (MOU) % YoY -1.0% QoQ -8.2% YoY +4.1% QoQ Q-13 4Q-13 1Q-14 2Q-14 3Q-14 4Q-14 3Q-13 4Q-13 1Q-14 2Q-14 3Q-14 4Q-14 ARPU ARPM Voice Traffic MOU ARPU stable despite significant increase in number of customers. Quality customers remained intact 10

11 Strong data usage in TByte Data usage in billion SMS delivered % YoY +42.9% QoQ -12.2% YoY +2.7% QoQ 29, ,871 15,372 19,185 20,911 6,485 3Q-13 4Q-13 1Q-14 2Q-14 3Q-14 4Q-14 3Q-13 4Q-13 1Q-14 2Q-14 3Q-14 4Q-14 Modernized network resulted in better data experience pushed data revenue growth 11

12 Operational expenses as percentage of revenue 3Q-13 4Q-13 1Q-14 2Q-14 3Q-14 4Q-14 Cost of Service (CoS) Personnel Marketing 41.7% 6.8% 4.2% 42.4% 8.7% 4.0% 41.4% 7.2% 2.8% 43.4% 7.3% 3.6% General and Administration 3.7% 5.1% 3.4% 4.1% Total Operating Expenses 56.4% 60.2% 54.8% 58.5% Depreciation and Amortization 37.8% 38.9% 34.4% 33.6% Provision for IM2 Legal Case 23.5% 42.7% 7.4% 4.9% 3.0% 57.9% 33.4% 45.2% 6.6% 5.9% 3.8% 61.4% 35.1% Total Expenses 94.2% 99.1% 89.2% 116.7% 91.3% 96.5% Higher Cost of Services due to expanding network Increased go-to-market expenses and escalated network quality perception 12

13 EBITDA Performance EBITDA and EBITDA margin in IDR billion 43.6% 2, % 2, % 41.5% 42.1% 38.6% +2.0% YoY -4.3% QoQ 2,611 2,421 2,569 2,459 FY14 EBITDA margin in line with guidance A lag between revenue generation and operational cost disbursement after network expansion impacted EBITDA result 3Q-13 4Q-13 1Q-14 2Q-14 3Q-14 4Q-14 EBITDA EBITDA Margin 13

14 Normalized net profit* Net profit % YoY -28.6% YoY 375 Normalized net loss bridge in IDR billion in IDR billion FY ,359-1,987-1,987-2,782 FY-12 FY-13 FY-14 Reported Change in Useful Life Net FX Loss Sale Provision TBIG IM2 Legal Shares Contingency Normalized FY2014 net loss impacted mainly by IM2 provision * Net profit is Profit Attribution to Owners of the Company 14

15 Balance sheet Gross debt* and gross debt/ebitda in IDR billion % YoY Net debt* and net debt/ebitda in IDR billion % YoY 25,598 28,052 27,346 21,680 25,819 23,866 FY-12 FY-13 FY-14 FY-12 FY-13 FY-14 Gross Debt Gross Debt/EBITDA Net Debt Net Debt/EBITDA 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 15

16 Free Cash Flow & Capex in IDR billion Free cash flow Capex and Capex/Revenue in IDR billion , , ,452 1,590 1,669 1,566 1, Q-13 4Q-13 1Q-14 2Q-14 3Q-14 4Q-14 3Q-13-1,045 4Q-13 1Q-14 2Q-14 3Q-14 4Q-14 Capex Capex/Revenue Positive free cash flow generated in FY2014 4Q14 negative free cash flow due to higher payment to suppliers 16

17 Network Development Number of BTS +65.7% YoY +7.6 QoQ 40,229 37,382 33,913 18,063 15,962 23,207 24,280 26,255 13,328 4,993 5,409 6, Cellular Revenue per BTS In IDR million ,214 18,871 19,892 20,585 21,420 22,166 3Q-13 4Q-13 1Q-14 3G 2G 2Q-14 3Q-14 4Q-14 FY 2013 Telkomsel Indosat XL FY 2014 Network modernization completed for key cities in Indonesia Completing network modernization for surrounding cities in Mid

18 Q4 in summary 18

19 Management Focus and Key Updates

20 Our Focus Leverage modernized network and improved customer experience to drive revenue growth Improve monetization of the strong growth in data users and traffic Increase cost efficiencies to enable investments for growth Develop adjacent and new businesses 20

21 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 trillion 21

22 Thank You Any further questions? Indosat Investor Relations Jl. Medan Merdeka Barat No. 21 Jakarta Tel: Investor@indosat.com Upcoming events 1Q Results 22

23 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. 23

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25 Supplemental Information

26 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,

27 Credit ratings improved Upgrade to AAA by Pefindo 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 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, 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/ and IDR1 trillion Sukuk Ijarah I/ of Indosat respectively. 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). 27

28 Debt maturity profile In IDR trillion Debt maturity profile* IDR USD in IDR * Excluding obligation under capital lease 28

29 Spectrum overview for top 4 cellular operators in Mhz 850 Mhz 900 Mhz 1800 Mhz 2100 Mhz 2300 Mhz Indosat ** Telkomsel * ** XL Axiata Hutchison * Telkom and Bakrie Telekom have the same spectrum, differentiated by its operational areas ** Indosat/IM2: West Java exclude Bogor, Depok & Bekasi ; Telkom/Telkomsel: Maluku & North Maluku 29