Telkom reports a net loss of Rp 1.17 trillion
Telkom reports a net loss of Rp 1.17 trillion
JAKARTA (JP): PT Telkom Indonesia has reported a net loss of
Rp 1.17 trillion (US$100 million) in the first half of this year
compared to a net profit of Rp 821 billion in the corresponding
period in 1997.
The publicly-listed telecommunications company attributed the
massive loss to the fall in the value of the rupiah against the
U.S. dollar during the six-month period.
The collapse of the rupiah caused massive foreign exchange
losses that devoured most of the company's operating profit
during the first half of 1998, the company said in a statement.
"The main cause of the net loss was foreign exchange losses,"
the company said.
The net foreign exchange loss was Rp 4.46 trillion as of June
30 this year. In the company's income statement, a sum of Rp 2.93
trillion from the total net foreign exchange loss was charged to
the other expenses account, while the remaining Rp 1.53 trillion
was capitalized to account for construction work in progress in
accordance with standard Indonesian accounting practices.
Another factor contributing to the company's alarming
financial performance were losses amounting to Rp 162 billion run
up on long term investments in affiliated companies.
The company's operating costs rose by 13 percent to Rp 3.24
trillion in the first six months of this year, compared to Rp
2.87 trillion in the corresponding period last year. Operating
profits reportedly rose 17 percent to Rp 1.49 trillion, from Rp
1.27 trillion in the first six months of 1997.
The shape of the company's loan portfolio changed
significantly over the reporting period as a result of the weak
and volatile rupiah.
"44.8 percent of the total loan portfolio was denominated in
rupiah and 55.2 percent in foreign currencies as of June 30," the
statement said.
In comparison, 88 percent of total loans at the end of the
first half of 1997 were denominated in rupiah and the remaining
12 percent in foreign currencies.
The company said the company suffered damage worth an
estimated Rp 16.3 billion during the May riots in which over
1,200 people died and thousands of buildings were looted,
ransacked and set on fire by angry mobs.
"Damage inflicted on network facilities in this period has had
a severe impact on the company's earning performance," the
statement said.
PT Telkom, which is listed on the Jakarta and New York Stock
Exchanges, is one of 12 state firms scheduled to be privatized in
this financial year in a sell off expected to raise US$1.5
billion.
The government, which holds a 65 percent stake in the
telecommunications firm, plans to divest an undisclosed part of
its stake in the company.
Shares in Telkom's fell Rp 125 to Rp 3,075 yesterday after
news of its poor first half results spread through the market.
(aly)