Indosat posts higher first quarter profit

JAKARTA (JP): State-owned international telecommunications operator PT Indosat reported here yesterday a consolidated net profit of Rp 132.4 billion (about US$55 million) in the first three months of this year, a 15.5 percent increase over the same period last year.

In the first quarter last year the firm had an 8.62 percent consolidated net profit growth.

The first quarter net profit growth was higher than the 11 percent or 12 percent predicted by analysts.

Indosat's president, Tjahjono Soerjodibroto, said the company's earnings per share were Rp 127.8, or $0.53 per American Depository Receipt, up 15.5 percent from last year.

"Our 1997 first quarter result shows our strong commitment to maintaining operating expenses at a slower growth rate than operating revenue. This has resulted in a 17.5 percent operating income growth, enabling us to maintain a 47 percent operating efficiency," he said.

Indosat said consolidated operating revenue was Rp 323.1 billion in the first quarter of 1997 against Rp 278.1 billion in 1996. The company's consolidated operating expenses rose to Rp 170.7 billion in the January to March period this year over last year.

Indosat's marketing director, Bambang Sulistyo, said the company's international telephone traffic rose 17.8 percent to 158.8 million minutes in the first quarter from 134.7 million minutes in 1996.

International telephone traffic rose 18 percent in the first quarter of 1996.

Bambang said that in January to March this year, Indosat's outgoing and incoming call traffic volume was 65.8 million and 93 million respectively, an increase of 17.1 percent and 18.5 percent over 1996.

Indosat's market share loss to its competitor appeared to be slowing, as shown by a higher market share for March 1997, of 89.1 percent for outgoing calls compared to 88.2 percent in December 1996.

The government has also licensed the privately-owned PT Satelindo to operate an international call service for a 10-year period until 2005.

"Our results reflect Indosat's successful attempt to maintain customers' confidence in Indosat's quality of service compared to our competitor and our ability to win back customers," said Bambang.

"In the first quarter of 1997, Indosat averaged an 89.3 percent market share. We are optimistic that we can maintain not less than an 89 percent market share throughout 1997," he said.

The company said it would develop new domestic, regional and multimedia businesses.

"Our domestic business plan has expanded include participation in the Personal Communications System/Personal Communications Network services whenever the government opens the bidding for licenses," said Indosat's director for corporate development, Safwan Natanagara.

Indosat, which was listed on the New York and Jakarta stock exchanges in October 1994, has a number of newly established subsidiaries including PT Indosat Multi Media, PT Datakom Asia and PT Multi Media Asia.

Indosat's shares closed at $29.87 per ADR in New York on Tuesday and lost Rp 200 to close at Rp 7,200 on the Jakarta Stock Exchange yesterday. (icn)