Telkom's net profit up in first quarter

Telkom's net profit up in first quarter

JAKARTA (JP): Publicly listed domestic telecommunication
provider PT Telkom Indonesia announced on Tuesday a consolidated
net income of Rp 751.94 billion (US$94.22 billion) for the first
quarter of this year.

Telkom said the figure reflected an increase of 145.7 percent
on the Rp 306 billion it earned in the same period last year.

Earnings per share were Rp 74.6, an increase of 9.35 percent
over the same period last year.

The company said the high increase in net income resulted from
a higher growth in total operating revenues than in operating
expenses as well as a decrease in the other net expenses.

The company, which is also cross-listed on the New York and
London stock exchanges, used a conversion rate of Rp 7,980
against the U.S. dollar in calculating its first quarter
financial statements.

During the first quarter this year, Telkom's total operating
revenues grew by 27 percent to Rp 2.22 trillion from Rp 1.75
trillion over the same period last year.

While its total operating expenses rose by 13.4 percent to Rp
1.12 trillion in the first quarter this year from Rp 990.24
billion in the corresponding period last year.

Foreign exchange losses reached Rp 258.8 billion in the first
quarter this year, but the loss could be offset by the company's
gain from foreign exchange of Rp 30.6 billion during the three
month period.

As of March 31 this year, Telkom and its five multinational
partners in the joint operation scheme (KSO) were operating a
total of 6,185,793 active telephone lines, comprising of
3,307,166 lines in Telkom regions and 2,878,627 lines in KSO
regions.

Under the KSO agreement signed in 1995, Telkom appointed five
consortia of local and foreign firms to finance, build and
operate two million telephone lines, a number which was later
revised to 1.2 million lines, in five regions across the country
until 2010 under a revenue-sharing scheme. The regions are
Sumatra, West Java, Central Java/Yogyakarta, Kalimantan and
eastern parts of Indonesia.

Due to the prolonged impact of the economic crisis, during the
first quarter, Telkom and its KSO partners lost 42,255
subscribers -- of which 20.8 percent were business subscribers,
78.1 percent residential subscribers and 1.1 percent social
subscribers.

Telkom, which is controlled by the government with a 66.19
percent stake, has the exclusive rights to provide local fixed
line calls until 2010 and domestic long distance calls until
2005.

The government said, however, it would arrange for an early
termination of the right as part of its plan to allow Telkom to
shift from being a fixed line telecom operator to a full network
service operator with the capability of providing both fixed line
and mobile phone local and international telephone calls.

On March 31, the communication ministry granted Telkom a
license in principle to operate a cellular service based on DCS-
1800 technology with nation-wide coverage.

Telkom is currently proceeding with the administration
requirements, including the frequency allocation, of the license.
(cst)