XL swings into loss despite strong subscriber growth

24 Feb 2009

Indonesia’s third largest mobile operator by subscribers, PT Excelcomindo Pratama (XL), reported full-year losses of IDR15 billion (USD1.26 million) for 2008 despite increasing its subscriber base by a healthy 68% to 26 million, a fact it attributes to higher interest rates on loans it assumed and foreign-exchange losses. The company posted year-on-year revenue growth of 45% to IDR12.2 trillion, said XL president Hasnul Suhaimi, ‘driven by a 705% increase in our total [voice] minutes to 54.9 billion minutes, and 68% growth in our subscriber base.’ He added that the firm’s strategy of offering a high quality service at lower prices ‘helped us gain about 5% market share in terms of revenue’. Earnings before interest, taxes, depreciation and amortisation (EBITDA) climbed 46% y-o-y to IDR5.13 trillion last year, while the EBITDA margin remained stable at 42%. Hasnul said that XL booked higher than expected interest expenses in FY2008, relating to additional loans it took out. Excluding the impact of FOREX and other losses, the operator would have booked normalised net income of IDR348 billion, he added.

In 2008 Excelcomindo invested heavily in its networks and services, Hasnul noted, upgrading both its hardware and software platforms to improve subscriber and traffic capacity levels. XL deployed an additional 5,572 base transceiver stations (BTSs) last year, at a total cost of USD1.2 billion, to end the year with a total of 16,729 BTSs. The CAPEX forecast for 2009 is a less ambitious USD600-USD700 million, which will be targeted at selected investment projects, he said.

Indonesia, XL Axiata