PT Link Net Tbk. Corporate Presentation Version Q3 2015 Disclaimer - - PowerPoint PPT Presentation

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PT Link Net Tbk. Corporate Presentation Version Q3 2015 Disclaimer - - PowerPoint PPT Presentation

PT Link Net Tbk. Corporate Presentation Version Q3 2015 Disclaimer THE INFORMATION CONTAINED IN THESE MATERIALS IS STRICTLY CONFIDENTIAL AND MAY NOT BE FORWARDED, PUBLISHED OR DISTRIBUTED, DIRECTLY OR INDIRECTLY, TO ANY OTHER PERSON (WHETHER


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PT Link Net Tbk.

Corporate Presentation Version Q3 2015

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Disclaimer

THE INFORMATION CONTAINED IN THESE MATERIALS IS STRICTLY CONFIDENTIAL AND MAY NOT BE FORWARDED, PUBLISHED OR DISTRIBUTED, DIRECTLY OR INDIRECTLY, TO ANY OTHER PERSON (WHETHER WITHIN OR OUTSIDE YOUR ORGANIZATION/FIRM) FOR ANY PURPOSE AND MAY NOT BE REPRODUCED IN ANY MANNER WHATSOEVER. ANY FORWARDING, PUBLICATION, DISTRIBUTION OR REPRODUCTION OF THESE MATERIALS IN WHOLE OR IN PART IS UNAUTHORIZED. IMPORTANT: You must read the following before continuing. In accessing the attached summary information presentation (this “presentation”), you are agree to be bound by the following terms and conditions. Confirmation of Your Representation: These materials and their contents may not be viewed by persons within Canada, Japan, the People’s Republic of China (excluding the Hong Kong Special Administrative Region) or by persons in the United

  • States. By attending or accessing this presentation, you represent that you are outside the United States, Canada, Japan, or the People’s Republic of China (excluding the Hong Kong Special Administration Region).

Neither these materials nor any of their contents may be disclosed or distributed or used for any other purpose without the prior written consent of PT Link Net Tbk (the “Company”). All information herein should be regarded as indicative, preliminary and for illustrative purposes only. Such information reflects prevailing conditions as of the date of this presentation, all of which is subject to change. The Company does not make any representation or warranty (express or implied) or accepts any responsibility or liability for the accuracy or completeness of these materials or any or all of the information in these materials or otherwise made

  • available. Accordingly, none of the Company or any other person shall be liable for any direct, indirect or consequential loss or damage suffered by any person as a result of relying on any statement in these materials, and any such liability is

expressly disclaimed. Nothing contained herein or therein is, or shall be relied upon as a promise, representation or warranty, whether as to the past or the future. You and your Representatives (pursuant to the definition of Law No. 8 of 1995 on Capital Markets (the “Capital Market Laws”)) acknowledge that, in connection with your and their obtainment of this presentation, it is illegal under the Capital Market Laws for any person who has received non-public material information to deal in securities in violation of the Capital Market Laws or to communicate that information to any other person under circumstances in which it is foreseeable that such person is likely to deal in such securities in violation of applicable Indonesian laws. This presentation contains “forward-looking statements”, which are based on current expectations and projections about future events, and include all statements other than statements of historical facts, including, without limitation, any statements preceded by, followed by or that include the words “targets”, “believes”, “expects”, “aims”, “intends”, “will”, “may”, “anticipates”, “would”, “plans”, “could”, “should”, “predicts”, “projects”, “estimates”, “foresees” or similar expressions or the negative thereof, as well as predictions, projections and forecasts of the economy or economic trends of the markets, which are not necessarily indicative of the future or likely performance of the Company, and projections and forecasts of their performance, which are not guaranteed. Such forward-looking statements, as well as those included in any other material discussed at the presentation or in these materials, concern future circumstances and results and involve known and unknown risks, uncertainties and other important factors beyond the Company’s control that could cause their actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions and estimates regarding the Company’s present and future business strategies, including expansion plans, dividend policy, and the environment in which they will operate in the future. Forward-looking statements are not guarantees of future performance. These forward-looking statements speak only as at the date of this presentation, and none of the Company or any of

  • ur respective directors, officers, employees, agents, affiliates, advisers or representatives intends or has any obligation or undertakes to supplement, amend, update or revise any forward-looking statements as a result of new information or to

reflect future events or circumstances, except as required under applicable laws. This presentation includes certain forecasts and projections. By their nature, forecast and projected financial information address a hypothetical situation, and therefore do not represent the actual financial position or results of the Company had the transactions described therein been completed at the dates assumed or any other date, or in the future and should not be regarded as an indication of the operating results generated by the Company or of the future financial position of the

  • Company. Given the abovementioned risks, uncertainties and assumptions, you should not place undue reliance on these forecast and projected financial information. Past performance is not necessarily indicative of future performance.

This presentation contains certain non-GAAP measures, including Adjusted EBITDA and EBITDA, that are not audited, not included in the Company's audited financial statements and not presented in accordance with Indonesian Financial Accounting Standards. The measures have been used by management as a supplemental measure of the Company’s performance. Although these measures are either contained in or fully reconcilable to line items on the Company's audited financial statements and/or based on management accounts, they may not be equivalent to similarly named measures used by other companies, and should not be considered as a measure comparable to income statement items for the year in the financial statements. This presentation also contains certain statistical data and analyses (the “Statistical Information”) which have been prepared in reliance upon information furnished by the Company and/or third party sources for which the Company has either

  • btained or is in the process of obtaining the necessary consents for use. Numerous assumptions were used in preparing the Statistical Information, which assumptions may or may not appear herein. As such, no assurance can be given as to

the Statistical Information’s accuracy, appropriateness or completeness in any particular context, nor as to whether the Statistical Information and/or the assumptions upon which they are based reflect present market conditions or future market

  • performance. Moreover, any information from third party sources contained in this presentation may not be used or relied upon by any other party, or for any other purpose, and may not, directly or indirectly, be reproduced, disseminated or

quoted without the prior written consent of such third party. Statistical Information provided by PT Nielsen Audience Management (“Nielsen”) is about demographic trends and not product performance and is aimed at Nielsen clients in the media

  • space. Such information/data reflects estimates of market conditions based on samples, and is prepared primarily as a marketing research tool for media companies, advertising agencies and advertisers. Nielsen’s Consumer Confidence

information/data measures consumer sentiment and confidence in the future of the economy, expenditure and saving patterns and major concerns. Such information/data reflects the optimism of consumers of the overall economic condition which includes future job prospects, and the indication of how consumers will spend and save their money in the next 12 months. This information/data is for general information and research purposes only and should not be viewed as a basis for investments. Any references to Nielsen should not be considered as Nielsen’s opinion or endorsement as to the value of any security or the advisability of investing in the Company This presentation does not purport to be a complete description of the terms of or the risks inherent in any actual or proposed transaction described herein. You should not construe any statements and/or information made in this presentation as tax or legal advice. The recipient of this presentation must conduct its own investigation and analysis of the proposed transaction and the information and data contained in this presentation and in connection with the proposed transaction should you proceed. No information set out in this presentation will form the basis of any contract. In furnishing these materials, none of the Company or any other person undertakes any obligation and/or liability to provide any additional information, to update these materials or to correct any inaccuracies or incompleteness which may become apparent. This presentation does not constitute or form part of and should not be construed as an offer to sell or the solicitation of an offer to buy securities in any jurisdiction in which such offer or sale would be restricted, prohibited or unlawful. ANY FORWARDING, DISTRIBUTION OR REPRODUCTION OF THIS PRESENTATION ELECTRONICALLY OR OTHERWISE, IN WHOLE OR IN PART, TO ANY OTHER PERSON IS UNAUTHORIZED. FAILURE TO COMPLY WITH THIS PARAGRAPH MAY RESULT IN A VIOLATION OF THE SECURITIES ACT, THE CAPITAL MARKETS LAW OR THE APPLICABLE LAWS OF OTHER JURISDICTIONS. IF THIS PRESENTATION HAS BEEN RECEIVED IN ERROR, IT MUST BE DELETED IMMEDIATELY.

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TMT

BANKING & FINANCE HOTELS & RESORTS UNIVERSITY & SCHOOLS HEALTH CARE

14 Hospitals

PROPERTY & REAL ESTATE RETAIL & STORES

350 Stores

Lippo’s strategic business pillars

SHOPPING MALLS

49 Malls

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Lippo TMT holistic eco-system under one roof

Data Center Electronic Payment IT & BP Outsourcing System Integrator Content Production Online Media Cable TV & Satellite TV Printed Media Broadband Internet Fiber Optic Network 4G Network Satellites Operators Document Management Cinema In Building Services

TECHNOLOGY TELECOM MEDIA

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Link Net key milestones

Network ownership under First Media Network ownership under Link Net

506

655 933 1,194

1,604 1999 2000 2007 – 2008 2011 2013 2014 till YTD’15

2010 2011 2012 2013 2014

1999 Launch of Cable TV services 2000 Launch of Internet services 2002 Sole provider to IDX of remote trading network 2014

  • Fully marketed secondary

placement (Oct) Post transaction shareholding (Dec)

  • First Media:

33.8%

  • CVC:

33.5%

  • Public:

32.7% Jun 2011

  • CVC invested in Link Net
  • Link Net acquired certain

network and related assets from First Media

2002

2007 – 2008 Launch of broadband services and bundled packages

Number of homes passed (‘000)

2010 Launch of HD

553

Jun 2011

2013

  • 1 million homes passed
  • Expanded network to

Greater Surabaya and Bandung

  • First to offer 100 Mbps to

the residential sector

2010

1,433

9M’15

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A large and underpenetrated market

(a) Based on 2015, Source: Media Partners Asia (b) 2014 – 19 CAGR, Source: Media Partners Asia and BMI (c) Based on 2015, Source: Media Partners Asia (d) Based on 2013, Source: Nielsen (e) Growth from 2010 to 2030, Source: McKinsey Global Institute (f) Based on 2010, Source: McKinsey Global Institute (g) By 2030, Source: McKinsey Global Institute (h) 2014-19 CAGR, Source: Media Partners Asia Source: World Bank, Media Partners Asia, McKinsey Global Institute

Indonesia is a large and attractive cable market with faster growth in larger cities

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Indonesia today… …with a highly compelling macro story

251 million people(a) 4th largest by population country(c) in the world 54% of Indonesians under 30 years of age(a)

One of the youngest(c) populations in the world

5.8% real GDP growth rate(b)

One of the fastest growing economies in the world(b) Consumption contribute to over 59%(d) of GDP Consumer class to grow by 90 million(e)

53%(f) urban population contributed to 74%(f) of

GDP

71%(g) urban population to contribute 86%(g)

  • f GDP

6.1% fixed broadband penetration rate(c) Of the highest fixed broadband growth of 10.8% CAGR(h)in the world 10.0% pay TV penetration rate(c) Fast Pay TV growth of 8.8% CAGR(h)

Large population base Young population High GDP growth CAGR Under-penetrated broadband Under-penetrated pay TV Consumption driven economy Urbanization with GDP concentration in cities

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3 Mbps 200 Mbps

speedy linkNet

Link Net undisputed leader in Next Generation Broadband (NGBB) in Indonesia

Large and fast growing market illustrates strong demand…

…and Link Net having the highest number of cumulative homes passed and subscribers

% ADSL Subs.

  • f total BB

90% 89% 83%

(a) Competitors subscribers and homes passed based on end 9M 2015, sourced from press releases, websites and internal data. Link Net data as of 9M 2015. Source: Media Partners Asia and Company data

…in an industry with only 2 key broadband players…

No other residential NGBB network of SCALE

2014-19 CAGR

21.4% 9.2%

1,789 3,400 5,280 193 414 1,093 2011 2014 2019 ADSL Cable / FTTx 100 Mbps

* Indihome ADSL

  • Homes passed 10 mio
  • Subs 3.4 mio (based on 2014)

421,000 60,000

Subs. market share(a)

84%

12%

Homes Passed Link Net 1.6 Mio TLKM FTTH 570K MNC Play 131K BizNet 250K MyRepublic 150K

Natural barriers to entry and first mover advantages

  • Longer learning curve due to limited FTTH expertise and rollout track

record (lower scale)

  • Difficult to get communities approval as new player with unproven track

record (quality & reliability). Existing subscribers reluctant to provide

access for new cable laying given amount of hassles

  • Limited scope for expansion of network esp. in Link Net’s existing areas.

And most attractive households already taken up by first mover

  • Nationwide roll-out vs. Link Net’s AB focus
  • Longer payback period and less attractive financial return
  • (TLKM) FTTH operations cannibalize an already profitable ADSL

business *

*) Based on 1H 2015 Company Data

  • 9M 2015 is 437K Subs.

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DOCSIS 3.0 enabled allowing high speed Internet connectivity up to 200Mbps 870MHz high capacity network(a) that enables our industry leading HD channels offering ~22,050 km of cable laid out in the 4 key regions Highly upgradable network

i.

Clear path to speeds up to 860Mbps without converting to FTTH

ii.

On average 360 homes per node – among the lowest globally(b)

iii.

Reasonable capex required to adopt FTTH if required in the long term

iv.

Economies of scale from large international bandwidth capacity of 180Gbps & Submarine cable capacity 4,000 Gbps Fully owned fiber backbone and last mile(c) – ensuring high quality services and cost control

(a) Expected to be fully compliant by end of 1Q 2015 (b) Source: Media Partners Asia (c) Limited exceptions for certain last mile owned by property developers Source: Company data

Rollout of FTTH network is costlier than HFC and

requires technical expertise to install

FTTH requires costlier consumer premise

equipment to support speed of 500Mbps or more Cost efficient to support current ARPU levels and

  • verall ROI

Majority of residential broadband subscribers subscribing for less than 100Mbps speed Flexibility to upgrade to FTTH with reasonable capex whenever required

HFC capable to offer large number of HD channels and VAS services (no real advantage for FTTH)

Technologically neutral, resilient and state-of-the-art network

In Indonesia today, HFC is still more suitable than FTTH

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9 15,211 14,386 9,425 130 Jakarta Bandung Surabaya Indonesia 117 107 99 31 Jakarta East Java West Java Rest of Indonesia

(a) Key cities in East Java include Gresik, Bangkalan, Mojokerto, Surabaya, Sidoarjo, Lamongan and West Java includes Bandung (b) Rest of Indonesia figure is the average of the remaining top 12 provinces as per BPS excluding Jakarta, East Java and West Java Source: Media Partners Asia, Biro Pusat Statistik (BPS), Nielsen and Company data

Targeting the most attractive cities...

Operating in provinces with high GDP in Indonesia Operating in cities with high population density in Indonesia

% of national GDP

13% 12% 11% 4%

Total population (millions)

10.1 2.5 3.1 248

(b) (a) (a)

Addressable market for Link Net

Per km2 in 2013 2013 GDP (US$ bn)

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E E D D C2 C2 C1 C1 B B A2 A2 A1 A1 2010 2013E Axis title

...and most attractive & fastest growing demographics

Link Net’s target market A1 >4,500 A2 3,000 – 4,500 B 2,000 – 3,000 C1 1,500 – 2,000 C2 1,000 – 1,500 D 700 – 1,000 E < 700 Households in Link Net's operating cities(a)

(a) Cities include Jakarta, Surabaya and Bandung Source: Nielsen 2014, assuming 4 pax per household (b) As per Nielsen 2015, AB households minimum expenditure is upgraded to Rp. 2,500,000

Affordable entry level packages also available for C1 segment customers Increasing proportion of AB segments since 2010 Unsatisfied demand for quality broadband and premium entertainment experience ABC1 growth driven by robust Indonesia macro fundamentals where lower income CDE hhs moving to affluent AB households

Monthly expenditure (IDR ‘000) (b)

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2.9% 6.3% 17.8% 23.2% 25.6% 16.9% 7.3% 6.4% 9.1% 28.6% 27.9% 19.1% 6.8% 2.2%

AB : 27% AB : 44% UAB segment less price sensitive

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Examples of target customers households

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Premium Intermediate Entry level

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Link Net is the only NGBB player of scale in Indonesia

Greater Jakarta

  • Addressable households(a): 3,347k
  • Homes passed: ~1.3m
  • Estimated coverage ratio: ~38%
  • Cable length: ~18,900km

Bandung

  • Addressable households(a): 238k
  • Homes passed: ~68k
  • Estimated coverage ratio: ~29%
  • Cable length: ~760km

Greater Surabaya

  • Addressable households(a): 474k
  • Homes passed: ~271k
  • Estimated coverage ratio: ~57%
  • Cable length: ~2,300km

Bali

  • Cable length: ~100km
  • Focus on hotels

(a) Based on addressable market of AB SES households as defined by Nielsen (2013 definition of SES classification) Source: Company data (As of 9M 2015), World bank, Media Partners Asia

Link Net is operating in the most attractive metropolitan areas of Indonesia

Hubs: 23 Total homes passed: > 1.6 Mio Total cable length: 22,050km

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13

199 359 529 849 1,649 2,175 3,119 (US$15) (US$28) (US$41) (US$65) (US$127) (US$167) (US$239)

(a) US$1 : IDR13,000 exchange rate was assumed Source: Company data as of Sept. 2015 All price is including CPE rental All price exclude 10% VAT

Profitability margins are similar across all packages from entry-level to most premium tier package

Catering to a large addressable market from a large C population to a fast growing AB segment D’Lite

  • Basic package
  • ffering for

subscribers with basic Internet and TV channel needs

Elite

  • Incremental add-on

packages which deliver faster Internet and more TV channel genres

Supreme

  • Package targeted for

consumers who are looking for full access to high speed Internet and all channels

Maxima

  • Designed for heavy

users of high speed internet who require full access to all channels

1 2 3 4

50 Mbps 162 channels 25 Mbps 162 channels 12 Mbps 134 channels 6 Mbps 110 channels

(US$)(a) IDR ‘000

Family

  • Entry-level package
  • ffering for

subscribers with basic Internet and TV Channel needs

2 Mbps 90 channels

5

100 Mbps 162 channels 200 Mbps 162 channels

6 7

Infinite Ultimate

  • Highest tier packages, offering the highest speed

possible combined with dedicated premium customer and technical service for users that demand the best service available

With a wide range of packages catering to a large addressable market

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Significant value to customers through Combo packages Q3

Package price(a)

(a) For comparison across products, packages analysed offer 2, 6 & 12 Mbps for Link Net vs. others similar mbps Internet package (b) USDIDR exchange rate of 13,000 Source: Company data, Corporate websites of service providers as of 30 Sept. 2015

($15) (US$)(b) IDR ‘000 199 359 529 360 485 353 350 349

6 Mbps 110 channels 2 Mbps 90 channels 2 Mbps 69 channels 10 Mbps 69 channels 7 Mbps 69-84 channels 6 Mbps 76 channels 10 Mbps 76 channels

($28) ($27) ($28) ($37) ($27) ($27) ($15) ($41)

12 Mbps 134 channels

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Successful upselling through focused marketing efforts

(a) 2015 Combo repackage Source: Company data

  • No. of upgrade transactions each year

Continuous innovations to stay ahead of the game

127,290 133,710 162,981 201,800 2012 2013 2014 9M 2015

15

Combo Product Retail Price Movement(a)

150 159 169 199 280 309 339 359 380 409 449 529 550 609 669 849 1,479 1,479 1,649

Q4 2012 Q3 2013 Q1 2014 Q1 2015

FAMILY DLITE ELITE SUPREME MAXIMA

(IDR ‘000s)

6%

Q4 2012 to Q1 2015

  • CAGR. (%)

16% 12% 9% 10%

Proven track record of package enhancements and upselling to drive ARPU growth

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402 415 FY 2014 9M 2015 Blended ARPU

Solid operating performance despite external pressures

Homes Passed (‘000) RGUs (‘000) and Churn% ARPU (IDR ‘000) 1,433 1,604 FY 2014 9M 2015 392 437

363 410

2.2% 2.3% FY 2014 9M 2015

Broadband Cable TV Churn Rate

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Key highlights – 9M 2015

Delivered steady financial results and growth over last 3 quarters amidst external pressures

  • Revenue of Rp 1,887 billion up 22% YoY
  • EBITDA of Rp 1,079 billion up 21% YoY
  • NPAT of Rp 461 billion up 10% YoY

Posted solid operating performance, further strengthening foundation for continued growth

  • 1.60 million homes passed, added 172k YTD Sep. 2015
  • 436,778 broadband RGUs, added 45k YTD Sep. 2015
  • 410,294 cable TV RGUs, added 47k YTD Sep. 2015
  • Maintained High 95% bundling rate (+1% vs. Q2’15)

Record quarter acquisition numbers in other wise low season Q3; Nett addition 34K boosted by re-marketing efforts and re-visiting sales comission structure Enterprise acquired more flagships accounts & secured additional strategic partnerships with reputable corporations in Q3 2015. YTD 1,564 accounts recorded FTTH Pilot finalized in September 2015 Recent Awards & Accolades:

  • PEFINDO25 Stock Price Index
  • 2015 Frost & Sullivan Indonesia Excellence Awards

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237 286 692 834 82 105 239 317 205 242 579 689 10 16 40 47 534 649 1,550 1,887 3Q-14 3Q-15 9M-14 9M-15 Broadband - residential Enterprise Cable TV Others

Steady revenue growth in 9M 2015

Revenue (IDR bn)

1 “Others” primarily includes revenue from payment charges, installation charges and auxiliary equipment sales.

1

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892 1,079

57.6% 57.2% 9M-14 9M-15

Healthy margins maintained

EBITDA (IDR bn) Net Profit (1) (IDR bn)

EBITDA and Net profit margins

421 461

27.2% 24.4% 9M-14 9M-15

1 Finance costs in YTD September 2015 P&L include net foreign exchange losses of Rp47 billion and financing and payment channel charges of Rp32 billion.

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278 134 144

Total Cash Total Debt Net Cash

Capex breakdown1 (IDR bn)

777 554 787 173 184 251 45 39 39

995 777 1,078

2013 2014 Sep 2015

Network-related Capex CPE Capex Other Capex

1 Capital expenditure represents additions to property, plant and equipment (PPE). 2 Network-related capital expenditure is the sum of additions to head-end electronics and network service control points. 3 CPE capital expenditure is the sum of additions to converters, decoders, cable modems and set-top boxes. 4 Other capital expenditure is the sum of additions to land, buildings, leasehold improvements, furniture and fixtures, office equipment and vehicles. 5 Total cash and debt position as of Sep 30, 2015. Total debt mainly comprises vendor financing.

2 3 4

Net Cash with large leverage capacity5 (IDR bn) Net Cash

Cash flow positive despite continued expansion

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Our strategies to drive future growth

Expand network coverage into areas with attractive penetration potential ~ approximately 200K to 240K additional homes passed per annum Increase penetration in existing coverage areas ARPU growth of around 3% - 5% Increase penetration of large and untapped enterprise market Grow advertising sales to monetize un-utilised inventory

Enterprise

15-20% of

Revenue Residential

80-85% of Revenue

A B C D E

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Appendix

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  • Over 20 years of experience in audit, consulting and corporate

finance in various industries including telecoms and media

  • Earned numerous international accounting professional

certifications.

  • Has held a number of senior positions for TMT pillar of Lippo Group,

I.e. CFO and CEO First Media, CEO Berita Satu, CFO Link Net, etc. Irwan Djaja, Deputy Chief Executive Officer

Link Net’s deep and experienced management team

Complementary skills and expertise with strong domestic and international track record

Source: Company data

  • Over 30 years of experience in CEO / MD / other leadership

positions at leading global and Indonesian technology companies including Microsoft, Motorola, PT Teknologi, Andalan Solusindo Pratama and PT Ander Cakra Buana Richard Kartawijaya, Chief Executive Officer

  • 19 years of experience in technology
  • Previously Vice President of Home Solutions and Architecture at

StarHub Desmond Poon, Chief Technology Officer Iris Wee, Chief Marketing Officer

  • 24 years of experience in telecoms, media and marketing
  • Previously Vice President of Home Solutions and

Content at StarHub Dewi Dharma Yanti , Director of Corporate Resources

  • 18 years experience in business services including those at Citibank
  • Currently covering matters related to procurement and HR

Agus Setiono, New Roll Out (“NRO”) Director

  • 23 years of experience in consumer and operations
  • Previously Vice President of Cards Marketing at Citibank

Liryawati, Investor Relation Director

  • 20 years in FMCG, Electronics and Telco. Expertise in Marketing,

Sales and Retail

  • Previously, worked in Philip Morris, Coca-Cola, Samsung. Last

position as CMO to BOLT! 4G TD-LTE Operator Joseph Lembayung, Enterprise Director

  • 15 years in Information & Communication Technology – Sales,

Account, Project, Channel & Marketing in Carrier, Enterprise and Corporate & regional role

  • Last position in Microsoft Indonesia in Media & Telecommunication

Clarissa Joesoep, Chief Financial Officer

  • Over 15 years experience in audit & consulting services, advertising

and media industries

  • Previously, CFO at PT Indonesia Media Televisi

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Edward Sanusi, Operations Director

  • 19 years experience in managing technology related business

models for software development, ISP, Cable TV, Social Media and system integration.

  • Previously, Managing Director at Plasmedia - PT Plexis Erakarsa

Pirantiniaga

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Profit and loss summary

Period ending Dec. 31, 9M ending Sep. 30, 3M ending Sep. 30, (IDR bn) FY 2014*) 9M 2014*) 9M 2015 3Q 2014*) 3Q 2015 Revenue 2,136.0 1,550.2 1,886.9 534.2 649.4 EBITDA 1,233.5 892.4 1,079.2 311.5 364.3 D&A

  • 393.4
  • 278.6
  • 372.5
  • 97.7
  • 135.7

Operating Profit 840.1 613.8 706.7 213.7 228.6 Margin % 39.3% 39.6% 37.5% 40.0% 35.2% Finance Income 17.8 13.4 11.5 5.0 3.2 Finance Cost

  • 55.7
  • 37.9
  • 78.7
  • 17.7
  • 36.1

Share in Loss of Associate

  • 43.2
  • 24.2
  • 20.9
  • 9.0

0.0 Profit Before Tax 759.0 565.1 618.7 192.1 195.7 Tax Expense

  • 198.6
  • 143.9
  • 157.8
  • 48.6
  • 48.4

Net Profit **) 560.3 421.3 460.9 143.5 147.3 Margin % 26.2% 27.2% 24.4% 26.9% 22.7%

*) As restated for implementation of new accounting standards, among others **) Net profit before proforma adjustment for FMTV acquisition

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As at Dec 31 As at Mar 31, As at Jun 30, As at Sep 30, (IDR bn) 2014*) 2015 2015 2015 Current Assets Cash and Cash Equivalents 366.8 396.6 328.4 277.9 Trade Receivables1 176.8 201.5 209.7 229.7 Total Current Assets 583.2 642.7 578.0 556.6 Non-Current Assets Property, Plant and Equipment - Net 2,693.6 2,860.1 3,114.0 3,415.7 Total Non-Current Assets 3,167.9 3,312.2 3,558.2 3,759.3 Total Assets 3,751.0 3,954.8 4,136.2 4,315.9 Current Liabilities Payables1 108.4 132.6 196.5 224.1 Current Maturities of Long-Term Debt 90.7 95.3 97.2 92.6 Total Current Liabilities 547.4 634.1 662.4 697.7 Non-Current Liabilities Long-Term Debt – Net of Current Maturities 91.3 72.2 49.2 41.7 Total Non-Curent Liabilities 156.8 140.9 122.6 119.5 Total Liabilities 704.2 774.9 785.0 817.2 Total Equity 3,046.9 3,179.9 3,351.2 3,498.7 Total Liabilities and Equity 3,751.0 3,954.8 4,136.2 4,315.9

Balance sheet summary

Net Cash of IDR 144bn

1 Receivables among others include receivables from both third parties and related parties. Payables include payables to both third parties and related parties. *) As restated for implementation of new accounting standards

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Economic stimulus packages recently announced by the Indonesian government

1st Stimulus – Economic Growth/Investment 2nd Stimulus – Economic Growth/Investment 3rd Stimulus – Cutting OPEX costs 4th Stimulus – Boost Labor Employment 5th Stimulus – deepen Capital markets

  • Tax holidays to pioneer Industries, in upstream metals,
  • il & gas refineries, basic chemicals, machinery,

maritime transport, and agriculture, fishery and forestry product processing.

  • Other eligibilities:

‒ processing industries operating in special economic zones and public-private partnerships in infrastructure ‒ Telco companies making a minimum investment of Rp500b can apply for a tax holiday

  • Criteria: investors need to put at least 10% of their

investment into the Indonesian banking system

  • Only new (ie, not current) investments are eligible for

these concessions.

  • Simplification of permitting procedures. Obtain

investment permits faster and cheaper from 8 days to just 3 hours ‒ Eligibilities: IDR 100 billion investment (~ USD $7 million) and to employ at least 1,000 people

  • Relaxed import requirements in relation to importers'

identification numbers

  • Indonesian labels on imported products – togive more

time to importers to attach labels on products.

  • Cut tax on interest deposit with export proceeds in

local banks (to boost forex liquidity) Currently income tax is 20 percent. ‒ 10% tax apply 1-month USD deposits at local banks; 2.5% tax for 6-month deposits; zero tax for deposit accounts over 6-months. ‒ 1-month IDR accounts, a 7.5% tax will apply; 5% tax for 3-month deposits; zero tax for 6-month (or longer)

  • Prices of jet fuel, 12-kilogram LPG canisters, 92-
  • ctane gasoline Pertamax, and 90-octane Pertalite

have been lowered.

  • Diesel price cut by IDR 200 to IDR 6,700 (USD $0.48)

per liter, effective per 10 October 2015.

  • Govt. will offer a 30 % price discount for electricity to

industries for usage between 11pm and 8am. ‒ Companies engaged in labor-intensive sectors plagued by financial turmoil are allowed to delay paying electricity bills (up to 60% of the bill) to the next year.

  • Gaz price set according to purchasing power of the

fertilizer industry (Only for industries). The price of gas for other (petrochemical, ceramics, etc.) will be reduced similarly

  • Minimum wage = previous min. wage + (previous min.

wage x (% annual inflation rate during the year + % GDP annual increase during the year). Not applicable to 8 provinces (min. wage still below basic cost of living). Instead granted an extra 5% rise annually for the next 4 years.

  • Govt subsidized micro loans (KUR).

‒ Expand eligibility: individuals, legal entities with productive micro, small and medium enterprises (MSMEs), Migrant workers working overseas, family members migrants with a fixed income. ‒ include: agriculture, fisheries, manufacturing, trade (excluding trade of imported goods, fish exports, domestic rice trade and F&B retail), services. KUR interest rate slashed to 12% from 22%

  • Widening capability of Indonesian Export Financing

Agency (LPEI) to subsidize and provide cheaper loans for export-oriented companies to expand

  • Discount on income tax for asset revaluation before
  • 2016. Currently at 10%, to be lowered to 3% (if done

by end 2015), 4% (if done by 1H16) and 6% (if done in 2H16).

  • Removed double taxation for REITs issued in
  • Indonesia. REITs to be considered a single entity,

unseparated from holding company. Dividend paid by the special purpose company [SPV] to the REITs [investor] is not a tax-object anymore

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SLIDE 27

Broadband subscribers share by technology and ARPU

Indonesia Broadband

Subs.: 57,876 K

Wireless Broadband

Subs.: 54,062 K

Fixed Broadband

Subs.: 3,814 K ARPU: US$ 12

ADSL

Subs.: 3,400 K ARPU: US$ 11

NGBB

Subs.: 414 K

HFC (Cable)

Subs.: 379 K ARPU: US$ 18

FTTH

Subs: 35K ARPU: US$ 14

(a) Based on 2015 Media Partners Asia (MPA) data ending December 21, 2014

93% 7% 89% 11% 92% 8%

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SLIDE 28

Pay TV subscribers share by technology and ARPU

Indonesia Pay TV

Subs.: 3,744 K

DTH

Subs.: 3,113 K ARPU: Rp 110,716

Cable TV

Subs.: 394 K ARPU : Rp 181,624

IPTV

Subs.: 108 K ARPU : Rp 69,664

DTT

Subs.: 130 K ARPU Rp 88,324

(a) Based on 2015 Media Partners Asia (MPA) data ending December 21, 2014

87% 0.3% 10.2% 2.6%

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SLIDE 29

Industry accolades achieved over time

Top Brand Award 2014

Internet Service Provider Fixed From Frontier Consulting Group & Marketing Magazine (Consecutive 2012–2014)

Corporate Image Award 2014

Pay TV From Frontier Consulting Group & Tempo Magazine (2012 & 2014)

Corporate Image Award 2014

Internet Provider From Frontier Consulting Group & Tempo Magazine (2014)

Top Telco 2014

Top Fixed Internet 2014 From Ikatan TI Indonesia & itech Magazine (2014)

Net Promoter Leader Award 2014

Pay TV and BB/Fixed ISP category From SWA magazine (Consecutive 2011-2014)

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SLIDE 30

Our recent achievements

PEFINDO25 Stock Price Index (August 1, 2015 to January 31, 2016)

Company/Stock with sound financial and liquidity performance PEFINDO25 initiated by Central Bank Indonesia and IDX

2015 Frost & Sullivan Indonesia Excellent Awards

Fixed Broadband Service of the Year (Company recognized to have pushed boundaries of excellence – rising above competitions and demonstrating

  • utstanding performance...)

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