PT Indosat nets higher profit in first semester

JAKARTA (JP): The state-owned international telecommunications provider PT Indosat reported yesterday a 6.42 percent increase in after-tax profit to Rp 235.1 billion (US$100.4 million) in the first half of this year.

The profit represented a net income of Rp 227.1 per share, or $0.97 per American Depository Share.

The company, which floated its shares on the New York and Jakarta Stock Exchanges in October 1994, gained a profit of Rp 220.9 billion in the first half of 1995, which indicated a 73.12 percent increase over the same period of 1994.

Due to the new interconnection tariff system set by the government in early 1995, Indosat succeeded in reducing its operating revenue in the January to June period of last year. The company's first-half operating revenue from interconnection alone dropped by 17.5 percent last year.

"This year's first six-month results are based on the performance of our international telecommunications core business that reflected the country's economic activities, which still showed a strong economy growth," Indosat's president, Tjahjono Soerjodibroto, told a press conference yesterday.

He said that Indosat's international telephone traffic increased by 17.54 percent to 278 million minutes in the first half of this year from 236.5 million minutes in the corresponding period of 1995. The growth rate in international telephone traffic in the January to June period of 1995 was 16.9 percent.

Out of the 278 million minutes of international telephone traffic, 159.4 million were incoming calls (up 16.01 percent from 137.4 million in 1995) and the remainder was outgoing calls (up 19.45 percent from 99.2 million).

The revenue from international calls rose 13.79 percent to Rp 532 billion ($227.2 million) in the first half of this year, from Rp 467.5 billion in the same period of last year. Meanwhile, the operating profit rose 15.37 percent to Rp 279.9 billion from Rp 242.6 billion.

According to Tjahjono, other services showing strong growth in this year's first six-month period were the high-speed leased line service -- which rose 81 percent from 163 circuits to 295 circuits -- and the telecast service, which rose 27.27 percent from 36,300 minutes to 46,200 minutes.

Despite the increased figures, some of Indosat's services decreased. The number of low-speed leased lines were 48 circuits in the first half of this year, down 31.25 percent from 63 circuits in the same period of 1995. Telex services reached 3.3 million minutes, down 12.12 percent from 3.7 million. Packet Switched Data Network services were 0.8 million minutes, down 62.5 percent from 1.3 million during the previous period.

"Looking to the future, we are confident that our performance will not be affected significantly by the declining trend in international accounting rates and increasing competition," Tjahjono said.

In addition to Indosat, under a decree from the minister of tourism, post and telecommunications, the government has handed over the exclusive rights to international telecommunications services in the country to PT Satelindo until the year 2005.

Tjahjono said Indosat's market share in the first six months of this year reached 92.4 percent, compared to 93.2 percent at the end of last year.

Tjahjono also announced yesterday that his company was still preparing itself to participate in a new Personal Communications System/Personal Handy-phone System (PHS) cellular venture, which will operate the improved digital mobile cellular telecommunications system in the country.

Indosat, which last year acquired 1.4 percent of the shares in PHS operator Astel in Japan, earlier announced its plan to sell 7.1 percent of its 35 percent stake in PT Telkomsel, an operator of Global System of Mobile communications cellular telephones.

The company announced in May that part of the funds raised from the sale of the 2.5 percentage points of Telkomsel will be used to finance the establishment of the new cellular venture.

Indosat's net profit increased by 59 percent to Rp 459.4 billion last year over 1994.

Indosat's share price was unchanged at $31.375 per American Depository Share on the New York Stock Exchange on Tuesday. Its share price on the Jakarta Stock Exchange stood at Rp 7,525 at yesterday's close. (icn)