Indonesia’s XL Axiata outlines USD928m investment to boost data

12 Apr 2013

Indonesian operator XL Axiata has revealed it is looking to spend up to IDR9 trillion (USD928 million) in 2013 to improve its mobile broadband data business, The Jakarta Globe cites the firm’s president Hasnul Suhaimi as saying. According to Hasnul, the company is setting aside between IDR8 trillion and IDR9 trillion to support the business expansion of data – specifically for 3G – following its recent award of a new block of 2100MHz spectrum from the Ministry for Communications and Information Technology (MoCI) last month. The official said that the development of the new block of UMTS spectrum is ‘already included in [XL’s] budget for capital expenditure’, adding that the cellco has paid IDR512 billion and the first annual fee for the right to use it. ‘This will increase the quality [of XL’s HotRod-branded mobile broadband service] and HotRod can have better performance,’ Hasnul added. Prior to the MiCI’s frequency award, XL Axiata had two 3G blocks.

Indonesia’s third largest mobile operator by subscribers, XL Axiata reported a 2% fall in net income for the twelve months to 31 December 2012 to IDR2.77 trillion from IDR2.83 trillion in FY11. Further, the carrier said that excluding the impact of unrealised FOREX transactions, severance payment provisions and accelerated depreciation, its income before amortisation of intangible assets for last year was down 9% at IDR2.88 trillion. Full year revenue of IDR21.28 trillion was a 15% improvement on the IDR18.47 trillion figure booked in FY11, driven by a 17% expansion in mobile revenue to IDR19.60 trillion. EBITDA meanwhile, grew by 4% year-on-year to IDR9.75 trillion; EBITDA margin contracted five percentage points to 46% on the back of higher SMS interconnection charges, CAPEX outlay and a change in revenue mix from voice/SMS to data. On a more positive note, TeleGeography notes that data usage more than doubled in FY12 as the number of data subscribers rose to 25.6 million by the year end. Axiata said that the rise in data usage is reflected in revenue from such services now contributing 20% of total revenue, up from 15% in 2011. In FY13 the group expects data to contribute 22%-23% of revenue. The mobile operator closed out 2012 with a total of 45.8 million mobile users, down 1% y-o-y; monthly blended ARPU was unchanged at IDR31,000.

Indonesia, XL Axiata