PT Indosat Tbk Nine Months 2012 Results. Indosat IR - New Template v pptx

Transcription

1 PT Indosat Tbk Nine Months 2012 Results 1

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

3 Financial and Operational Results 3

4 YoY Overview Consolidated Revenue growth of 7.6% to IDR trillion EBITDA growth of 5.5% to IDR 7.65 trillion, EBITDA Margin declined -0.9 ppt to 46.3% Profit Attributable to Owners of The Company increased to IDR 1.63 trillion Free Cash Flow increased 111.1% to IDR 4.75 trillion 4 4

5 QoQ Overview Consolidated Revenue growth of 13.6% to IDR 6.13 trillion EBITDA growth of 8.9% to IDR 2.77 trillion, EBITDA Margin declined 2.0 ppt to 45.1% Profit Attributable to Owners of The Company increased to IDR 1.76 trillion Free Cash Flow increased 210.2% to IDR 3.53 trillion 5 5

6 Solid financial results In IDR billion 9M-11 9M-12 YoY 2Q-12 3Q-12 QoQ Operating Revenue 15,349 16, % 5,400 6, % EBITDA 7,246 7, % 2,541 2, % EBITDA Margin 47.2% 46.3% -0.9ppt 47.1% 45.1% -2.0ppt Profit Attribution to Owners of the Company 1,047 1, % (149) 1,760 1,285.3% Improvement in the top line during third quarter driving positive EBITDA growth 6 6

7 Strong annual growth in cellular and fixed data businesses Operating Revenue Breakdown in IDR billion +15.5% YoY +13.6% QoQ 5,168 5, ,259 4,357 5,213 4, ,160 4,080 5, ,447 6, ,124 QoQ / YoY 9.4% / -11.7% 4.4% / 14.8% 15.2% / 17.6% 2Q-11 3Q-11 4Q-11 1Q-12 2Q-12 3Q-12 Fixed Voice Fixed Data Cellular Improvement in commercial execution driving strong growth in cellular business in 3Q

8 Cellular revenue driven by strong voice and SMS revenue development YoY QoQ Voice -5.9% 15.5% Successful IM3 Seru Anti Galau campaign and Promo 3 hari 3 malam SMS 70.2% 31.5% Successful SMS campaigns driving growth together with newly implemented SMS interconnection Data 6.5% 0.2% Data value propositions currently focused on increasing number of data users and traffic VAS -69.9% 0.3% VAS revenue development impacted by uncertain market conditions 8 8

9 Strong growth in customer base Number of cellular customers in million +7.8% YoY +8.9% QoQ in million Net customer additions Q-11 3Q-11 4Q-11 1Q-12 2Q-12 3Q-12 2Q-11 3Q-11 4Q-11 1Q-12 2Q-12 3Q-12 Successful campaigns and distribution improvements key to increased net adds Improving churn trend 9 9

10 ARPU improving on higher voice and SMS traffic in thousand IDR (ARPU) in IDR (ARPM) ARPU and ARPM in IDR/minute Voice traffic and MOU in billion minute in minute/subscriber % YoY +14.5% QoQ +27.3% YoY +20.4% QoQ Q-11 3Q-11 4Q-11 1Q-12 2Q-12 3Q-12 2Q-11 3Q-11 4Q-11 1Q-12 2Q-12 3Q-12 ARPU ARPM Voice Traffic MOU Third quarter commercial programs resulted in positive voice traffic & revenue elasticity 10 10

11 Improving SMS traffic trend; data usage picking up in TByte Data usage +60.0% YoY +17.8% QoQ in billion SMS delivered +8.0% YoY +7.0% QoQ 2,337 2,520 2,842 3,240 3,423 4, Q-11 3Q-11 4Q-11 1Q-12 2Q-12 3Q-12 2Q-11 3Q-11 4Q-11 1Q-12 2Q-12 3Q-12 Good growth in SMS traffic in third quarter Data usage showing good improvement, monetization focus short/medium term 11 11

12 Operational expenses development As percentage of revenue 2Q-11 3Q-11 4Q-11 1Q-12 2Q-12 3Q-12 Cost of Service 35.3% 35.2% 38.5% 37.7% 39.4% 41.1% Depreciation and Amortization 31.0% 31.5% 33.3% 34.2% 32.0% 38.1% Personnel 12.6% 7.0% 6.9% 6.8% 6.7% 5.8% Marketing 5.2% 5.9% 4.9% 4.9% 4.7% 5.6% General and Administration 2.3% 1.4% 5.7% 3.7% 2.1% 2.4% Total Expenses 86.3% 81.0% 89.2% 87.3% 84.9% 93.0% Cost of service and deprecation impacted by SMS interconnect and change in network equipment useful life Operational efficiency program on track 12 12

13 Strong EBITDA growth EBITDA and EBITDA margin in IDR billion 44.7% 50.5% 47.0% 47.1% 44.0% 45.1% Normalized EBITDA bridge in IDR billion Q3 2, ,879 2,308 2, % YoY 2,295 2, % QoQ 2,541 2,768 Reported 7,647 Tower Transaction 106 SMS Interconn. 18 Normalized YTD 7,771 2Q-11 3Q-11 EBITDA 4Q-11 1Q-12 2Q-12 3Q-12 EBITDA Margin Reported Tower Transaction SMS Interconn. Normalized EBITDA margin pressured by SMS interconnect and additional lease fees and loss of revenue as a result of the tower sale and lease back 13 13

14 Net profit* boosted by tower sale in IDR billion Net profit +55.5% YoY Normalized net profit bridge in IDR billion Q3 1, % YoY 1,628 1, ,047 Reported 1,628 Tower Transaction Change in Useful Life Normalized YTD 1, M-10 9M-11 9M-12 Reported Tower Transaction Change in Useful Life Normalized Normalized Net Profit strengthening on better financial performance and a more stable FX situation in Q3 * Net profit is Profit Attribution to Owners of the Company 14 14

15 Change in useful life assessment Change in useful life of cellular network equipment from 10 years to 8 years Reflect the shorter technology life cycle in the telecommunication industry In line with Qtel Group policy and industry practice in Indonesia 15 15

16 Net debt to EBITDA ratio improved on receipt of tower sale proceeds Gross debt and gross debt/ebitda in IDR billion Net debt and net debt/ebitda in IDR billion % YoY -11.8% YoY 24,421 21,929 22,099 18,236 20,120 17,751 9M-10 9M-11 9M-12 Gross Debt Gross Debt/EBITDA 9M-10 9M-11 Net Debt 9M-12 Net Debt/EBITDA 16 16

17 Strong free cash flow in IDR billion Free cash flow Capex and Capex/Revenue in IDR billion 3, % 1, , % 22.7% 1,349 1,202 2, % 1, % 1, % 1, Q-11 3Q-11 4Q-11 1Q-12 2Q-12 3Q-12 2Q-11 3Q-11 4Q-11 1Q-12 2Q-12 3Q-12 Capex Capex/Revenue Free cash flow boosted by tower sale proceeds of IDR2.8 trillion during Q

18 Network roll-out progress Number of BTS +15% YoY +3% QoQ In IDR million Revenue per BTS 18,408 3,061 18,776 3,199 19,253 3,437 20,063 3,772 21,039 4,141 21,642 4, ,347 15,577 15,816 16,291 16,898 17,211 2Q-11 3G 3Q-11 2G 4Q-11 1Q-12 2Q-12 3Q-12 H Telkomsel Indosat XL H Modernization of the network key focus based on regulatory approval of technology neutral 900 MHz spectrum (3G on 900MHz) 18 18

19 Management Focus and Key updates 19

20 We are improving our commercial execution to accelerate the momentum Continue prepaid portfolio re-design and pricing fine-tuning Brand portfolio refresh Introduce new data strategy focused on increased relevance in the market and better profitability Sales and distribution revamp 20 20

21 Near term management focus Continue improving execution & keep good commercial momentum Strengthen data growth & performance Enhance customer experience; roll-out high performance data network (3G 900) Operational efficiency program 21 21

22 2012 Guidance maintained FY 2011 Actual FY 2012 Guidance Consolidated Revenue Growth 3.9% In line with Industry EBITDA Margin 46.3% 46.0% % Cash CAPEX IDR 6.1 trillion IDR 6.0 trillion +/- 10% 22 22

23 Thank You Any further questions? Indosat Investor Relations Jl. Medan Merdeka Barat No. 21 Jakarta Tel: Investor@indosat.com Upcoming events FY-2012 Results in 1Q

24 Disclaimer PT Indosat Tbk cautions investors that certain statements contained in this document state management's intentions, hopes, beliefs, expectations, or predictions of the future are forward-looking statements Management 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: Our ability to manage domestic and international growth and maintain a high level of customer service Future sales growth Market acceptance of our product and service offerings Our ability to secure adequate financing or equity capital to fund our operations Network expansion Performance of our network and equipment Our 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 24 24

25 25

26 Supplemental Information 26

27 Credit ratings maintained On 8 February 2012, Moody s affirmed Indosat Ba1 ratings and Stable outlook, follows announcement that Indosat has agreed to sell 2,500 of its communications towers to PT Tower Bersama Infrastructure Tbk. On 30 April 2012, FitchRatings upgraded Indonesia-based Indosat Long-Term Foreign and Local-Currency Issuer Default Ratings (IDR) and Foreign Currency senior unsecured rating to BBB from BBB-. The Outlook is Stable. On 3 July 2012, Standard and Poor s ( S&P ) has upgraded Long-Term Credit Rating and the Indosat s Guaranteed Notes Rating to BB+ from BB. S&P also removed all the ratings from their CreditWatch. The Outlook is Stable to reflect S&P expectation that Indosat's operating performance will be stable. The agency also raised their long-term ASEAN regional rating scale on Indosat to axbbb+ from axbbb-. On 12 June 2012, Pefindo assigned Indosat, all its IDR Bond and Sukuk Ijarah rating idaa+, idaa+, and idaa+(sy) respectively. The Outlook is stable. The ratings reflect the strong parent support, Indosat s stable market position, and its stable operating performance. However, the ratings are offset by Indosat aggressive capital structure and intense competition within the telecommunication industry

28 Impact on Q3 financials of tower sale and lease back transaction Net impact as of Sep 2012 in IDR billion Income Statement Balance Sheet Revenue -35 2,610 Assets Operating expense Liabilities Gain on sale of towers 2,083 1,780 Equity Tax and others -195 Net profit 1,780 Accounting treatment for tower sale and lease back transaction is predominantly classified as operating lease 28 28

29 We are within our covenants 9M-10 9M-11 9M-12 Net debt to equity Gross debt to equity < 2.5x Net debt to EBITDA Gross debt to EBITDA < 3.5x Interest coverage > 3.0x 29 29

30 Debt maturity profile Debt maturity profile In IDR trillion IDR USD in IDR 30 30

31 Spectrum overview for top 3 cellular operators in Mhz 900 Mhz 1800 Mhz 2100 Mhz 2300 Mhz Indosat Telkomsel XL Axiata