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ublicly listed telecommunications operator PT Indosat plans to raise funds from the bond market to refinance its debts maturing this year as well as to finance its capital expenditure (capex).

Indosat spokesman Andromeda H. Trisanto said on Wednesday his firm would issue more bonds at the end of the first quarter or the beginning of the second quarter this year.

'€œWe will use the funds raised from the bond issuance for debt refinancing and capex this year,'€ he said, adding that the total value of the bonds would be decided later.

The company issued Rp 2.5 trillion (US$200.2 million) in bonds last year, comprising Rp 2.31 trillion in conventional bonds and Rp 190 billion in Islamic bonds.

Indosat has secured a permit from the Financial Services Authority (OJK) to issue Rp 10 trillion of sustaining bonds, Rp 2.5 trillion of which were issued in December last year.

While Andromeda refused to give any details on the value of the bonds that would be issued later this year, Indosat will at least need Rp 2.89 trillion to pay its loans maturing in the first quarter to the third quarter this year.

According to its report, Indosat has $55.8 million and Rp 2.2 trillion of loans maturing from the first quarter to the third quarter this year.

Loans maturing in the first quarter this year include Rp 1.5 trillion of revolving-credit facility from Bank Central Asia (BCA), $11.07 million from a SEK loan and $10.07 million from HSBC France.

Maturing in the second quarter are loans from SEK and a 9-year commercial facility amounting $13.5 million as well as Rp 700 billion of revolving-credit facility from Bank Negara Indonesia (BNI).

The firm also has $21.17 million loans from SEK loan tranches and HSBC France maturing in the third quarter this year.

The telecommunications operator has Rp 320 billion bonds maturing in the second quarter this year.

Aside from paying its debts maturing this year, the funds raised from the bond issuance in the first or second quarter would be used to finance Indosat'€™s capex this year, according to Andromeda.

Indosat president director Alexander Rusli said previously that his firm would spend less in capex this year as it already spent a lot on network modernization last year.

Indosat would become more efficient and focus on growth this year, he said previously.

The firm, which is 65 percent owned by the Qatar-based Ooredoo Group, spent around Rp 8 trillion in capex last year.

'€œ[Among efficiency efforts], we will carry out a call option in July this year for our $650 million bond maturing in 2020,'€ Andromeda said, refusing to disclose whether it would buy back all or only part of the bonds.

The call option was aimed to slash the firm'€™s exposure to US-dollar denominated debts to around 20 percent to eventually reduce the impact of currency fluctuation, he went on.

As of September last year, the firm'€™s total debts stood at Rp 21.6 trillion, around half of which was in US dollars.

Andromeda added that his firm also targeted to press its gross debt to earnings before interest, tax, depreciation and amortization (EBITDA) ratio to 2 from around 2.5 last year.