Indosat operating profits up 34%

Indosat operating profits up 34%

JAKARTA: PT Indonesian Satellite Corp. (Indosat) said over the
weekend that its unaudited net profit fell 23 percent in the
first half of the year to Rp 402.1 billion from Rp525.1 billion a
year earlier mainly due to a new accounting policy on
amortization of goodwill.

The company said that as of Jan. 1 this year, it changed the
amortization period of goodwill as a result of acquiring cellular
company PT Satelit Palapa Indonesia, or Satelindo, to 15 years
from five years. Indosat bought Satelindo last year.

The extension of goodwill over the longer period reflects the
company's view that the cellular business in Indonesia is
expected to grow over a longer period than five years, the
company said.

Indosat said that its operating revenues rose 27 percent to
Rp3.882 trillion from Rp3.067 trillion, driven by a 53 percent
increase in cellular revenues, which is largely attributed to a
rise in the number of subscribers.

The cellular business contributed 57.5 percent to the
company's revenues in the first half of the year, international
calls 25.4 percent, multi media 15.9 percent, and other services
the remaining 1.2 percent, the company said.

Operating income rose 34 percent to Rp1.244 trillion from
Rp925.9 trillion.

Singapore Technologies Telemedia owns a 42 percent stake in
Indosat, the Indonesian government 15 percent, and public
investors the remaining 43 percent.--Dow Jones