Telkom reports lower earnings in first half

JAKARTA (JP): Publicly listed telecommunications company PT Telkom reported on Tuesday an unaudited net income of Rp 1.24 trillion (US$152.43 million) during the first semester of this year, down 15.2 percent from Rp 1.47 trillion for the same period last year.

The company said the decrease was partly due to an increase in foreign exchange losses to Rp 1.03 billion over the six month period.

Telkom said its total operating revenues grew 20.88 percent to reach Rp 4.51 trillion in the first half of this year from Rp 3.73 trillion in the comparable period of 1999.

The growth was partly due to the higher revenues Telkom had received from its five Joint Cooperation Scheme (KSO) partners in the first half of this year which amounted to Rp 1.12 trillion compared to 831.47 billion in the comparable period of last year.

Telkom's total operating expenses were up by 8.18 percent to Rp 2.31 trillion from Rp 2.13 trillion in the first six months of last year.

But the operating income still recorded an increase of 37.93 percent to Rp 2.19 trillion in the first semester of this year from Rp 1.59 trillion for the same period last year, due to a significant growth in total revenue.

Telkom said that as of June 30, its total debt reached Rp 9.92 trillion, some 45.8 percent of which was denominated in rupiah and the rest in various foreign currencies.

During the first six months of this year, the company spent approximately Rp 509.23 billion to finance the expansion of its telephone network and some Rp 219.21 billion for technology development and new businesses.

Telkom installed during the first semester a total of 17,942 new telephone lines.

As of June 30, Telkom and its five KSO partners operated a total of 6.32 million telephone lines, whereas 3.38 million lines of them were located in Telkom's operational zones in Jakarta and East Java and the rest distributed in the partners' areas across the country.

Telkom said some 97,351 subscribers had canceled their subscription during the period, a figure which was better than last year's record of 127,644 cancellations.

Most the new lines, 76.9 percent, were used by residential subscribers and some 22.5 percent by business subscribers.

Telkom said it would likely be forced to increase the telephone rates this year by 21.67 percent to comply with the government's policy.

The government has scheduled a gradual increase in the local fixed-line telephone tariff by 21.67 percent this year, 16.60 percent next year and another 8.22 percent in 2001.

Telkom also said that in line with the government's grand policy on the country's telecommunications sector, it would give up its monopoly of local and domestic long distance call services in 2002 and 2003, ahead of the original schedules of 2010 and 2005 respectively.

In return, the company said it would be allowed to operate the basic fixed-line telephone service for local, domestic long distance and international calls as well as Internet and multimedia businesses.

Telkom said the government had awarded it with a license in principle for the international call service in August and was expected to award the operating license to the business in August 2003. (cst)