Telkom forecasts sales to increase 20% in 2006 from network expansion
Telkom forecasts sales to increase 20% in 2006 from network expansion
Soraya Permatasari and Naila Firdausi, Bloomberg/Jakarta
PT Telekomunikasi Indonesia (Telkom), the nation's biggest
telephone company, expects sales to rise 20 percent next year, as
the company plans to expand its network to attract more users.
Telkom and its units have budgeted a combined Rp 14.5 trillion
(US$1.44 billion) to Rp 19 trillion for capital expenditure next
year, higher than the Rp 13 trillion for this year, said
President Arwin Rasyid.
Telkom is counting on rising demand for mobile-phone services
in the country. Indonesia's cell-phone users may increase to
about 79 million by 2007, according to Morgan Stanley, making the
country Asia's fourth-largest mobile-phone market.
"We still expect good growth in cellular-service demand and
also more demand for Flexi," Rasyid told reporters and analysts
on Thursday. "The capex is for expanding cellular and Flexi
networks and to expand broadband for our multimedia services."
Telkom said in October it added 140,000 users to its Flexi
wireless service that charges its customers a cheaper, fixed-line
rate. Telkom had 3.8 million Flexi users in September and aims to
raise its Flexi user base to five million, Bisnis Indonesia
reported on Sept. 30. Telkom said on Nov. 14 it is seeking to
partner with a Hong Kong-based company to expand its multimedia
business.
The company also expects this year's revenue to increase 20
percent, Rasyid said. That's higher than the 18 percent sales
increase estimated in August.
Telkom said on Oct. 31 net income in the nine months to Sept.
30 rose 19 percent to Rp 5.78 trillion as revenue at its mobile-
phone unit PT Telekomunikasi Selular (Telkomsel) gained 29
percent. In 2004, Telkom earned Rp 6.13 trillion in net income on
sales of Rp 33.9 trillion.
Separately, Telkom Chief Commissioner Tanri Abeng said the
company has proposed to add two directors to its board. In a June
shareholders' meeting the company increased the size of the board
to seven from five.
"The first one will be to handle risk management, and the
other will be for logistics and services," he told reporters on
Thursday in Jakarta. "We feel we need more directors to support
our efforts to triple our market value in five years."
Telkom's shares gained Rp 150, or 2.9 percent, to Rp 5,300 at
the 12 p.m. local time break on the Jakarta Stock Exchange.