PT Link Net Tbk Signing Ceremony 5 September 2017 Indonesia macro: - - PowerPoint PPT Presentation

PT Link Net Tbk

Signing Ceremony 5 September 2017

1

Indonesia macro: a massive opportunity

932 1,466

2016 2021

Rapid GDP/capita growth(a) 3,598 5,312

GDP (US$bn) GDP per capita (US$)

Increasing disposable incomes(b) Increasing urbanization(c) 46% 34% 54% 66%

2016 2030

Urban Rural

+12%

3,770 4,973

2016 2021

Annual household disposable incomes (US$) As % of GDP

259 276

2016 2021

Rising population growth

Population (m)

~53% of population under 30 years of age Millennials with “internet lifestyle”

Source: 2017 Media Partners Asia unless otherwise stated a) Source: IMF Data (GDP refers to nominal GDP) b) Source: OECD Data c) Source: World Bank and IMF

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11.2% 17.6% 30.7% 40.3% 52.4% 69.0% 79.2% 13.4% 22.5% 31.1% 44.9% 52.6% 85.8% 77.9%

Indonesia Philippines Thailand Vietnam Malaysia China Singapore

2016 penetration 2020 penetration

Indonesia fixed broadband and Pay TV are significantly underpenetrated

9.1% 10.6% 28.3% 33.4% 34.4% 52.3% 88.5% 14.4% 17.1% 32.3% 45.0% 38.8% 74.2% 94.8%

Indonesia Philippines Thailand Vietnam Malaysia China Singapore

2016 penetration 2020 penetration Fixed broadband penetration rate of key comparable countries Pay TV penetration rate of key comparable countries

Source: 2016 Media Partners Asia

4,372 5,674 3,359 4,580 6,840 7,108 8,969 10,877 3,790 3,959 317,280 407,122 948 955 5,750 9,270 2,396 3,999 6,540 7,628 8,562 12,353 2,510 2,952 244,955 355,881 1,062 1,161

Subscriber (000) Subscriber (000)

3

Link Net at a glance

Note: Company data as of 30 June 2017 unless otherwise stated a) HSBB refers to High Speed Broadband which is a fixed network capable of providing internet speeds of at least 4Mbps b) Source: 2017 Media Partners Asia. Link Net is a leading HSBB provider in Indonesia in terms of subscriber market share as of 30 June 2017 according to Media Partners Asia c) 7.3m addressable homes – According to, and based on addressable market of Upper 1, Upper 2 and Middle 1 SEC households, as defined by, Nielsen (2Q17 definition of SEC classification) – For Greater Jakarta, Greater Surabaya (Includes Malang) and Medan. Nielsen reports based on number of people aged 10 and above. Addressable homes or households is derived by assuming each home or household has 4 people each d) Revenue CAGR over FY2014 to FY2016 e) Refers to 2016. EBITDA is a non-GAAP financial measure of the Company’s performance and should not be considered as an alternative to performance measures derived in accordance with IFAS. See slide 38 for more information, including a reconciliation to profit for the period. EBITDA margin is defined as EBITDA divided by revenue f) Limited exceptions for certain last mile owned by property developers

A leading HSBB(a) provider in Indonesia(b) with ~1.9m Homes passed Targets large and fast growing affluent segment(c). Large subscriber base (~1.1m RGUs) with low and stable churn Innovation led premium product

• ffering supporting

premium ARPUs with 97% bundling rate Strong enterprise portfolio offering with certain governmental and financial institutions including IDX as customers Track record of strong growth – 18% revenue CAGR(d) with 59% EBITDA(e) margin along with resilient balance sheet Fully-owned(f), technology neutral network with abundant capacity

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Total addressable HH’s: 7.3m(a) Total LN homes passed: 1.9m Total cable length: 24,890km Bali

• Focus on hotels

Greater Surabaya & Malang

• Addressable households(a): 1,204k
• Homes passed: ~351k
• Estimated coverage ratio(c): ~29%

Greater Jakarta

• Addressable households(a): 5,157k
• Homes passed: ~1.457m
• Estimated coverage ratio(c): ~28%

Batam

• Roll outs started in June 2017

Medan

• Addressable households(a): 380k
• Homes passed: ~4k(b)
• Estimated coverage ratio(c): ~1%

Bandung

• Addressable households(a): 580k
• Homes passed: ~97k
• Estimated coverage ratio(c): ~17%

City homes passed / Total homes passed

1

77%

1

5%

1

18%

1

Note: Company data as of 30 June 2017 unless otherwise stated a) According to, and based on addressable market of Upper 1, Upper 2 and Middle 1 SEC households as defined by, Nielsen (2Q17 definition of SEC classification) – For Greater Jakarta, Greater Surabaya (Includes Malang) and Medan. Nielsen reports based on number of people aged 10 and above. Addressable homes or households is derived by assuming each home or household has 4 people each b) Includes homes passed for Batam, where roll outs started in June 2017 c) Coverage ratio calculated as homes passed divided by the total addressable households (based on Nielsen data)

…and operates in most attractive metropolitan areas

5

Link Net has achieved roll-out success …

Link Net is able to gradually ramp up new roll-outs over the past 5 years, supported by continuing growth in existing markets, expansion into in new regions and new avenues such as partnering housing developers to accelerate this deployment, and acquiring fiber infrastructure

Strong execution track record in rolling new homes passed Maximized investment returns by cherry picking the premium households who can afford Link Net services Proven expansion strategy and technical know-how

Leveraging existing & new channels to accelerate homes passed

Growing homes passed

Leveraging existing fiber backbone Regular rollout Extensions Partnering home developers Acquiring fiber infrastructure Homes passed and cable length

933 1,194 1,433 1,673 1,862 1,909 12,805 16,309 19,689 22,859 24,266 24,890 1,000 6,000 11,000 16,000 21,000 26,000 31,000 500 1,000 1,500 2,000 2,500

2012 2013 2014 2015 2016 1H2017

Homes passed (000) Cable length (km)

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Partnering home developers to accelerate homes passed

Indonet Cowell Development Intiland Jakarta Garden City Residence One, Serpong Summarecon Apartments Bumi Serpong Damai (BSD) Mangkuluhur City Apartment Citraland, Surabaya

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…and enlarge its subscriber base whilst maintaining its premium ARPU

Link Net achieved strong RGU additions with further penetrations while retaining premium ARPU

Added new RGUs while keeping churn at 2.3%

392 457 521 547 363 433 503 528 755 890 1,024 1,075 2.2% 2.3% 2.2% 2.3%

– 0.5% 1.0% 1.5% 2.0%

2014 2015 2016 1H 2017

Broadband Cable TV Churn

('000)

Maintaining premium ARPU

402 415 407 419 2014 2015 2016 1H 2017

(IDR '000)

8

1,393 1,651 719 842

1H16 1H17 2Q16 2Q17

Highly attractive financial profile…

Revenue

(IDR billions)

9

… with potential leverage capacity

834 976

1H 2016 1H 2017

Source: Company information (1) Capex represents additions to property and equipment (2) Total cash and debt position as of June 30, 2017. Total debt mainly comprises vendor financing

EBITDA

(IDR in billions)

59.8% 59.1%

EBITDA margin (%)

Capex (IDR bn)(1)

Net Cash with potential leverage capacity(2)

452 408

1H 2016 1H 2017

531 154 377

Total Cash Total Debt Net Cash

(IDR in billions)

397 490

1H 2016 1H 2017

Net Profit

(IDR in billions)

28.5% 29.7%

Net Profit margin (%)

10

Fully-owned(a) advanced and technologically resilient HSBB network

Future proof network with abundant bandwidth capacity and high level of network redundancy

>24,800 km of cable across Indonesia Has access to a total of 780 Gbps of International bandwidth capacity Owns and has the capability to operate up to 8 Tbps fiber lines to Singapore gateway Fully owned fiber backbone and last mile(a)

Headend Distribution hubs Node Subscriber premises

Technologically agnostic approach to future rollout:

• HFC network in the existing brownfield areas and FTTH network to be

rolled out in new areas within the brownfield for enhancement

• FTTH network to be rolled-out in greenfield areas with market skewed

to the fiber-centric infrastructure Offering a high quality HFC and FTTH network offering speeds upgradable to 10Gbps

a) Limited exceptions for certain last mile owned by property developers b) Refers to greenfield network rollouts only c) Gigabit Passive Optical Network

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Link Net has already completed most of its end-to-end network infrastructure, assuring network quality and reducing future investment requirement

International Gateway Inter-city Connection Intra-city Connection Last Mile Roll-out

2 proprietary international fibre lines / submarine cables providing bandwidth to Singapore Acquired Jakabare in 2013 and B2JS in 2015 Acquired pan-Java backbone in 2017 100% proprietary intra- city connection in all of the operating cities Substantially self-owned last mile roll-out(b)

Vertically Integrated End-to-end Network Infrastructure Selective usage of Third Party Network for Quality

24,890 km(a) of cable network

Fully-owned(b) advanced and technologically resilient HSBB network (cont’d)

a) Total cable length includes HFC and FTTH b) Limited exceptions for certain last mile owned by property developers

First Media accelerating expansion momentum

13

Regional expansion through intercity hub acquisition in Java

Ultimate Capacity & Network Design Coverage Time Delivery

The Network will employ DWDM technology with a maximum capacity 8000Gbps. It will be design with 1+1+R redundancy configuration using the five protection rings to achieve high network availability. The DWDM system can upgraded easily to meet future demand The Network will cover most of major cities in Java Island with 43 POP sites. A full 100G wavelength will be activated at every city commissioned to provide ample capacity to support future growth The DWDM system is being designed and implemented now and will be ready by Q1 2018

14

Regional expansion through intercity hub acquisition in Java

The intercity fiber backbone will open doors to more than 43 cities that were previously untapped by Link Net

Build and managed by Triasmitra Group, the telecommunication infrastructure deployer, including rolling out fiber optic and power cable network with a total over 7,000 km of submarine and inland FO cable system deployed.

• Route using national way
• Total 5 Rings
• Total distance of 2,615 km
• Capacity: 4 cores (North), 4 cores (South)

To achieve 2.8 million homes passed cumulative in 5 years (existing and new cities)

CITIES COVERED: No City No City No City No City No City 1 Bandung 10 Ciranjang 19 Jombang 28 Purwakarta 37 Surabaya 2 Bekasi 11 Cirebon 20 Karawang 29 Purwodadi 38 Tegal 3 Bobotsari 12 Depok 21 Kebumen 30 Purwokerto 39 Tjepu 4 Bogor 13 Gandrungmangu 22 Lamongan 31 Salatiga 40 Ungaran 5 Bojonegoro 14 Garut 23 Madiun 32 Semarang 41 Wates 6 Boyolali 15 Gendingan 24 Mojokerto 33 Solo 42 Weleri 7 Cepu 16 Gresik 25 Nganjuk 34 Subang 43 Yogyakarta 8 Ciamis 17 Indramayu 26 Patrol 35 Sukabumi 9 Cilacap 18 Jakarta 27 Pekalongan 36 Sumedang

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PT Ketrosden Triasmitra

23 years

• f experience in telco

industry

3 Core Businesses

Strong competence as telco Developer, Contractor, and Managed Service company

7,304 km

More than 7,000 km of submarine and inland FO cable system deployed

15 Premier Customers

The Certification

Certification

Construction Service Work Permit Grade 7 The Committee Safety & Health Supervisory ISO 9001 ISO 14001 OHSAS 18001 Jartup License

• No. 325 - 2015

Thank you