Telkom's 1997 profit slides on forex losses

Telkom's 1997 profit slides on forex losses

JAKARTA (JP): State-owned telecommunications company PT
Telekomunikasi Indonesia said yesterday the monetary crisis had
dragged down its net profits by 23.4 percent last year to Rp 1.5
trillion (US$187.5 million).

Company president Asman Akhir Nasution attributed the decline
to significant foreign exchange losses, totaling Rp 424.4
billion, resulting from the rupiah's sharp drop on the dollar
since the economic turmoil began.

"A large part of our investment came from offshore loans,
(and) the rupiah's depreciation against the dollar forced us to
carry the burden of foreign exchange losses in a large amount,"
Nasution said after the publicly listed Telkom's general
shareholders meeting here.

The rupiah began to crumble against the dollar last July. It
is currently at a level 70 percent lower than it was before the
crisis, when it was around Rp 2,450 to the dollar.

Nasution also announced Telkom recorded Rp 295 billion in
losses incurred by some of its subsidiary companies.

He refused to disclose which of the 22 subsidiaries suffered
the losses.

He said since the monetary crisis reduced purchasing powers of
its customers and cut cash flows of many companies, Telkom's
earnings from users of its service also declined.

Companies' cost-saving measures of moving from high-rise
office buildings to office houses contributed somewhat to the
decline, he said.

Shareholders agreed at yesterday's meeting to distribute a
dividend of Rp 452.4 billion, or 40 percent of the total net
profit, up from 26 percent of the 1996 dividend.

Shareholders will be paid Rp 48.47 a share, the company said.

About 27 percent of the 40 percent dividends would be
distributed on July 1, and the remaining 13 percent on Dec. 30.
(das)