Business Context and Reporting Period
This Form 6-K filing by Perusahaan Perseroan (Persero) PT Telekomunikasi Indonesia Tbk (Telkom Indonesia) is dated March 30, 2020. The company, a state-owned telecommunications provider in Indonesia, is announcing a plan to repurchase its own shares in response to significantly fluctuated market conditions caused by the COVID-19 outbreak and global economic deceleration.
Key Financial Metrics and Liquidity
- Buyback Budget: Maximum of IDR 1,500,000,000,000 (IDR 1.5 trillion).
- Share Volume Limit: Maximum 20% of paid-up capital, ensuring at least 7.5% of floating shares remain.
- Profit Balance (as of Sept 30, 2019): IDR 91,264 billion.
- Pro Forma Total Assets (post-buyback): IDR 213,490 billion (down from IDR 214,990 billion).
- Pro Forma Total Equity (post-buyback): IDR 114,946 billion (down from IDR 116,446 billion).
- Pro Forma Earnings Per Share (EPS): Expected to increase from IDR 166.15 to IDR 167.02.
- Financing Source: Internal cash and profit balance; no new debt issuance mentioned.
Material Changes and Market Conditions
The filing highlights a significant decline in the company's stock price, which dropped 34% from IDR 3,970 to IDR 2,620 between January 1, 2020, and March 19, 2020. This decline mirrors the 18.46% drop in the Indonesia Composite Stock Price Index (IHSG) during the same period. Management asserts that the stock price decrease does not reflect the company's actual positive performance.
Guidance, Outlook, and Management Commentary
- Buyback Period: March 30, 2020, to June 29, 2020 (3 months).
- Method: Transactions will be executed via the Indonesia Stock Exchange (IDX) through appointed broker PT Bahana Sekuritas.
- Impact on Operations: Management states the buyback will not materially affect business activities, revenue, or growth due to sufficient working capital and cash flow.
- Impact on Finance: The transaction is expected to have a minimum impact on the cost of finance. Revenue is not expected to decrease.
- Share Rights: Repurchased shares will not have voting rights or dividend rights.
Investor Verification Checklist
- Verify the actual execution volume and average price of the buyback against the stated IDR 1.5 trillion cap.
- Confirm the company's cash flow stability given the concurrent economic pressures from the COVID-19 pandemic.
- Monitor the floating share percentage to ensure it remains above the regulatory minimum of 7.5%.
- Review subsequent quarterly reports to validate the pro forma EPS increase and the lack of material adverse effect on operations.