Telkom revises estimate of joint-operation revenues

JAKARTA (JP): The state-owned domestic telecommunications provider PT Telekomunikasi Indonesia (Telkom) yesterday revised its estimate of revenues from the privatization of its telecommunications business.

In a statement on its unaudited financial results for the first three months to March 31 this year, the company reported that instead of receiving Rp 1.46 trillion (US$620.32 million) it expected to see only Rp 1.42 trillion ($603.31 million). The funds will come in 11 monthly payments from the five private firms who have been awarded 15-year concessions to install 2.25 million telephone lines in most parts of the country, except the Jakarta greater area and East Java.

The company reported that this was caused by the fact that it had not received any money from PT Daya Mitra yet; this company was to start installing telephone lines in Kalimantan in January, but had to delay the project until April 1, 1996.

The delay was caused by the replacement of Telekom Malaysia with Cable & Wireless as the foreign partner of PT Daya Mitra.

Telkom also reported that the company had received Rp 273.6 billion in Minimum Telkom Revenues (MTR) and Rp 22.9 billion in Distributable Telkom Revenues (DTR) from the four regions managed by the private operators during the first quarter of this year.

"The MTR and DTR earnings reflect contractual obligations for the first quarter of 1996. Telkom decided to use accrual accounting on the recognition of revenues from the MTR payments. The method is different to what was previously explained to various investors and analyst," the report said.

"The reason for this change was a recent consultation with the auditors who recommended the change in accounting treatment of MTR payments from a cash basis to an accrual basis."

In addition to Kalimantan, the joint-operation contracts cover Sumatra, West Java, Central Java and the country's eastern region: Sulawesi, Maluku, Irian Jaya and Nusa Tenggara.

The five projects are part of the government's drive to install five million telephone lines in the current Sixth Five- Year Development Plan period which will end in March, 1999.

Three million lines will be installed in Greater Jakarta and East Java, which will both remain under Telkom itself.

The contracts were estimated to bring in total revenues of Rp 15.25 trillion for Telkom within the next 15 years.

Profits

The company, which is 70 percent owned by the government and 30 percent by domestic and overseas investors, reported yesterday an unaudited net profit of Rp 307.2 billion (US$130.61 million) in the first three months of this year, 55 percent up from the same period in 1995.

The company reported that Telkom's earnings per share were Rp 32.91 in the first quarter in 1996, an increase of 39.3 percent from Rp 23.63 in the corresponding period of last year. Earnings per American Depository Receipt in the first three months were $0.28 compared to $0.2 in the same period in 1995.

The company reported that its operating profit rose to Rp 419.4 billion in the first quarter of this year, up 32 percent from the same period last year.

"The increase in operating income was principally due to the company's continued growth in the number of lines in service and corresponding increased call volume in the fixed line network," the report said.

The report said that as of March 31, 1996, the company had 3.84 million telephone lines in service, an increase of 35 percent over the end of the first quarter of 1995's total of 2.58 million. About 0.12 million out of the 3.84 million lines were public phones.

"The number of subscribers increased by 35 percent to 3.36 million from 2.49 million. The mix of subscribers is approximately 23 percent business, 76 percent residential (including government offices) and 1 percent "social" subscribers (churches, mosques, and charities)."

The company also reported that its total assets rose by 30 percent to Rp 15.89 trillion as of March.

The company reported aggregate capital expenditures in the first quarter of 1996 of Rp 593 billion, of which Rp 480.1 billion was spent on the expansion of the company's fixed line network.

Telkom increased its exchange capacity by 211,442 lines to 5.03 million lines. Installed lines rose 31 percent to 4.63 million lines in the first quarter of 1996 over the same period last year.

Telkom's shares closed Rp 25 lower at Rp 3,550 on the Jakarta Stock Exchange yesterday. (icn)