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L Axiata, one of Indonesia'€™s major cell phone operators, has decided to pay part of its US dollar denominated debts and convert another foreign debt portion to reduce currency risks resulting from the sharp depreciation of the Indonesian currency against the US dollar.

The company announced on the Indonesia Stock Exchange (IDX) website on Thursday that it had this week paid US$50 million of loans it borrowed from United Overseas Bank (UOB) nearly two years ahead of their maturity in 2017.

The company also decided to convert $180 million of its loans from Bank of Tokyo-Mitsubishi UFJ into rupiah as part of its efforts to reduce currency risks resulting from the fall in the rupiah, which early this week fell further to near 14,800 per dollar, the lowest level since July 1998.

'€œTo strengthen our company'€™s financial performance, we improved our financial report management by converting our loans into rupiah as well as precipitating our loan payment,'€ XL president director Dian Siswarini said in the statement.

'€œThese moves are among our initiatives to proactively reduce currency costs.'€

The country'€™s second biggest cell phone company paid up to $100 million of its debts to UOB Bank last month, ahead of their maturity in March 2017.

Dian previously said that unfavorable global economic conditions had impacted the company'€™s financial performance, especially due to the presence of unhedged loans among its liabilities that had made the company record losses on foreign exchange (forex) every quarter.

The company'€™s losses on forex ballooned from Rp 250.74 billion in the first half of last year to Rp 1.4 trillion in the corresponding period this year.

'€œDue to that reason, we decided to precipitate payments for our foreign denominated bonds in the hope that our financial report would improve in the future,'€ Dian said.

In the first half of 2015, XL recognized a total of Rp 850.89 billion in losses mainly due to the weakening of the rupiah, doubled from Rp 444.81 billion it recorded in the first half of last year.

The company'€™s lower profit year-on-year (yoy) from the same period last year stemmed from a larger forex impact and because of the impact of the Axis Telekom Indonesia acquisition and integration which was completed late in the first quarter of 2014 amid higher operational costs and ballooning debts to fund the acquisition.

The company secured the loan in March 2014, prior to acquiring Axis Telekom Indonesia.

The firm pocketed a $500 million loan from Axiata Group Berhard'€™s shareholders and the remaining $365 million from three other banking institutions, namely UOB, the Bank of Tokyo Mitsubishi and DBS Bank.

Axiata Group is a Malaysian telecommunications firm that holds a 66.5 percent stake in XL, while the public holds the remaining 33.5 percent.

The funds used to pay up the loans were taken from the company'€™s internal cash, Dian said, and the loan payment for UOB was only an early stage of initiatives the company would undertake in the coming months in reducing currency exposure on the company'€™s unhedged foreign liabilities.

According to the company'€™s financial report, around 48 percent of its total $1.55 billion dollar-denominated loans are not hedged.

The financial report mentioned that if the rupiah depreciated by 5 percent against the US dollar, the company'€™s losses for the period would increase by Rp 1.03 trillion from the period before the depreciation occurred.

Earlier this year, XL said that it would refinance its Rp 4 trillion maturing debt, either through bank loans or by issuing bonds. Another option, the company said, would be to sell its base transceiver station (BTS) towers. The firm has officially invited bidders to buy a portion of its towers.