Business Context and Reporting Period
This Form 6-K filing by Perusahaan Perseroan (Persero) PT Telekomunikasi Indonesia Tbk ("TELKOM") was submitted on May 11, 2009. The filing simultaneously discloses the audited consolidated financial statements for the full year ended December 31, 2008, and the unaudited consolidated financial statements for the first quarter ended March 31, 2009. TELKOM is Indonesia's largest full-service network provider, with its majority-owned subsidiary, Telkomsel, serving as the country's largest mobile cellular operator.
Key Financial Metrics
Full Year 2008 (Audited)
- Total Operating Revenues: Rp 60,689,784 million (approx. US$ 5.57 billion).
- Operating Income: Rp 22,307,475 million (approx. US$ 2.05 billion).
- Net Income: Rp 10,619,470 million (approx. US$ 974 million).
- Basic Earnings Per Share: Rp 537.73.
- Total Assets (Dec 31, 2008): Rp 91,256,250 million.
- Total Liabilities (Dec 31, 2008): Rp 47,258,399 million (Current: Rp 26,998,151 million; Non-current: Rp 20,260,248 million).
- Cash and Cash Equivalents: Rp 6,889,945 million.
First Quarter 2009 (Unaudited)
- Total Operating Revenues: Rp 14,702,178 million (approx. US$ 1.27 billion).
- Operating Income: Rp 5,288,198 million (approx. US$ 458 million).
- Net Income: Rp 2,457,884 million (approx. US$ 213 million).
- Basic Earnings Per Share: Rp 124.46.
- Total Assets (Mar 31, 2009): Rp 91,292,770 million.
- Cash and Cash Equivalents: Rp 6,509,704 million.
Material Changes vs. Prior Period
Operational Growth (Q1 2009 vs. Q1 2008)
- ADSL (Speedy) Subscribers: Increased 144.8% from 292,000 to 716,000.
- Fixed Wireless Subscribers: Increased 99.4% from 6.7 million to 13.4 million.
- Cellular Subscribers: Increased 40.5% from 51.3 million to 72.1 million.
Financial Performance (Q1 2009 vs. Q1 2008)
- Revenue: Total operating revenues declined slightly from Rp 15,031,603 million to Rp 14,702,178 million.
- Net Income: Decreased significantly from Rp 3,207,334 million to Rp 2,457,884 million.
- Foreign Exchange: Net loss on foreign exchange widened from Rp 45,655 million in Q1 2008 to Rp 211,718 million in Q1 2009.
- Interest Expense: Doubled from Rp 263,146 million to Rp 517,388 million.
- Fixed Line Revenue: Declined from Rp 2,540,438 million to Rp 2,116,593 million.
Guidance, Outlook, and Risks
Management commentary from President Director Rinaldi Firmansyah highlights that while operational performance remained strong with significant subscriber growth, financial results were negatively impacted by a decrease in tariffs and foreign exchange losses compared to the prior year. Management stated it is "premature to judge all external factors impacting TELKOM's performance in Q1 2009."
Risks and Contingencies:
- Foreign Exchange Volatility: Significant losses recorded in Q1 2009 due to currency fluctuations.
- Tariff Reductions: Explicitly cited as a factor reducing financial results despite volume growth.
- Debt Servicing: Interest expense increased substantially in Q1 2009, indicating higher borrowing costs or increased debt levels.
Investor Verification Checklist
- Verify the specific impact of tariff reductions on the fixed-line revenue segment, which showed a decline despite overall subscriber growth in other areas.
- Confirm the drivers behind the doubling of interest expense in Q1 2009 compared to Q1 2008.
- Assess the sustainability of the 144.8% growth in ADSL subscribers and its contribution to future revenue mix.
- Review the full text of the 2008 Annual Report and Q1 2009 unaudited statements attached to the filing for detailed segment breakdowns not fully summarized here.
- Monitor foreign exchange rate trends between the Indonesian Rupiah and the US Dollar, given the material impact on Q1 2009 earnings.