Thu, 03 Aug 2000

Indosat profit rises by 41.5% in first half

JAKARTA (JP): Publicly listed international telephone operator PT Indonesian Satellite Corporation (Indosat) announced on Wednesday unaudited consolidated net income of Rp 944.4 billion (US$108.1 million) for the first half of 2000.

The international direct dial (IDD) provider said profits were 41.5 percent higher than the corresponding period in 1999.

Company president Hari Kartana said call efficiency efforts by many companies and the increasing use of new technology in the IDD service, which offered cheaper costs to customers, had affected Indosat's total telephone traffic.

He said Indosat's total telephone traffic declined 0.3 percent to 318.1 million minutes in the first half this year from 319.1 million minutes in the corresponding period of 1999.

"However, despite the unfavorable condition, Indosat's outgoing telephone traffic in first half 2000 has remained strong," he said in a company statement.

He said outgoing telephone traffic reached 139.6 million minutes in the first half this year, while incoming traffic hit 178.5 million minutes, reflecting a positive incoming to outgoing ratio of 1.28, a slight increase compared to the 1.24 ratio in the corresponding period of last year.

He said its outgoing traffic in first half 2000 declined almost 2.0 percent compared to the corresponding period last year.

"However we succeeded in maintaining our market share of around 89.0 percent in outgoing traffic as of June 30, 2000 through a continued marketing campaign," he added.

On the incoming side, the growth of incoming traffic was 1.0 percent compared to the same corresponding period last year.

The company reported its consolidated operating revenues for the first half this year increased by 0.7 percent to Rp 1,446.5 billion from Rp 1,435.8 billion for the same period last year.

It said the main contributor to the growth was the higher revenues obtained from the international telephone service, with increased volume of 1.7 percent, and revenues from other telecommunications services, which grew by 1.0 percent.

On the other income side, the company said it had seen a significant increase in gains on foreign exchange-net of Rp 281.3 percent to Rp 299.0 billion in first half 2000 from a negative Rp 164.9 billion in first half of 1999 as the impact of rupiah depreciation against the U.S. dollar.

The company said investment income had declined by 12.9 percent to Rp 146.8 billion, derived from equity accounted profit and dividends of Rp 215.3 billion from Telkomsel, Lintasarta, Intelsat and other affiliates, equity accounted losses of Rp 76.5 billion from MGTI, and interest from other affiliates.

The company said its earnings per share were Rp 912.0 or US$ 1.04 per American Depository Share (ADS) -- 10 shares equals 1 ADS and using the Central Bank June 30, 2000 closing exchange rate of Rp 8,735 per US$.

Indosat is now preparing to expand its business to include cellular service, scheduled to start operation next year, and fixed-line based local and domestic telephone call services in 2002.

Indosat lists its shares on the Jakarta and Surabaya Stock Exchanges and its American Depositary Shares are listed on The New York Stock Exchange. (cst)