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Indosat achieved double-digit EBITDA and revenue growth, surpassing industry performance

Creative Desk (The Jakarta Post)
Jakarta
Thu, October 31, 2024

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Indosat achieved double-digit EBITDA and revenue growth, surpassing industry performance

I

ndosat Ooredoo Hutchinson has secured excellent financial performance, with double-digit growth in the first nine months of 2024, driven by the company’s focus on operational excellence. Indosat reported double-digit growth, exceeding the industry’s benchmark with a substantial increase in various key financial indicators. This achievement is expected to help Indonesia's telecommunications industry grow, reversing the declining trend seen throughout the year. 

In the first nine months of the year, Indosat recorded a total revenue of Rp 41.81 trillion (US$2.67 billion), up 11.6 percent year-on-year (yoy), while earnings before interest, taxes, depreciation and amortization (EBITDA) showed powerful growth, up 15 percent yoy to Rp 20 trillion, which helped improve Indosat’s EBTIDA margin to 47.8 percent and a profit for the year attributable to owners of the parent of Rp 3.88 trillion, keeping on with quarter profitability record, up 39.1 percent yoy, which also showed a positive trend in Indosat’s quarterly growth.

“Customer is requesting for good experience, they are looking for good connectivity, and they are looking for value, not cheap products. Therefore it is us to give them what they want and that will help the industry move in the right direction,” Vikram emphasize.

The cellular business segment, MIDI and fixed telecommunications contributed 84.3 percent, 14.1 percent and 1.6 percent, respectively to the revenue. Cellular service continued to show its domination, up 9.5 percent yoy, which derived from the utilization of data, while the MIDI segment posted a significant surge of 30.2 percent fueled by fixed internet, foxed connectivity and IT services.

The shift to artificial intelligence and digital-based solutions has led to MIDI becoming a significant contributor to Indosat’s business.

Indosat Ooredoo Hutchison President Director Vikram Sinha pointed out, “The result reflects our endeavors in focusing on operation excellence, strategic capital allocation and the utilization of AI-based transformation. We continue to focus on presenting impressive experience to the entire stakeholders and ensuring the finance performance strength as well as navigating telecommunications landscape that continues to develop.”

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The performance was the result of a strategy that focuses on increasing the customer value and cost efficiency to produce solid performance overall.

“Our return on capital employed has risen from 5-6% to 9-10%. As the industry becomes healthier, we’re optimistic about achieving over 12%,” Vikram added.

The company’s strategic capital expenditure was key to the achievement, with the investment focused on increasing the network infrastructure, especially in rural areas and in eastern parts of Indonesia, and supporting business expansion. Indosat added 12.5 percent more 4G base transceiver stations (BTS) yoy to 193,562 to meet the demand for data, which continues to rise, while maintaining an impressive experience for customers.

This has positioned the company for sustainable, long-term growth. The expansion has spurred a traffic jump, with an impressive increase of 12.5 percent yoy to 12,050 petabytes (PB) in the first nine months of the year.

Furthermore, Indosat’s focus on gaining quality customers has made a significant contribution to the increase in average revenue per user (ARPU) for cellular customers to Rp37,700 in the first nine month of the year, marking an increase of 8.7 percent or Rp 3,000 compared to the corresponding period in the previous year.

Indosat continued enhancing infrastructure to ensure powerful and reliable coverage nationwide. Amid the ongoing transformation, integrated AI is utilized to optimize its operation, spurring innovations and enhancing customer experience. The approach has succeeded in increasing the operational efficiency and strengthening the company’s competitive position in the market.  

To support this initiative, Indosat has also established strategic partnerships with global companies including NVIDIA, Microsoft, Google, Mastercard and Huawei.

Several key achievements that Indosat has made included the launch of the AI Experience Center and GPU Merdeka by Lintasarta, Indosat’s subsidiary, which provides AI-based cloud computing. The endeavor is aligned with the 2045 Golden Indonesia vision.

To demonstrate its commitment to empower digitally, Indosat continues to bridge the digital divide and support an inclusive digital environment. Through the company’s initiatives such as IDCamp and SheHacks, Indosat is active in expanding digital literacy and promoting gender equality. To date, IDCamp has helped more than 270,000 students, equipped them with pivotal skills to support Indonesia’s digital economy.

Indosat also drives the implementation of the environmental, social and governance (ESG) agenda by performing sustainable practices, including renewable energy solution, enhancing cyber security and strengthening data privacy protection.

All these initiatives are part of Indosat’s commitment to building a more inclusive digital future for Indonesia.  “Through collaborative approaches, the inspiration for which is taken from the spirit of gotong royong (mutual cooperation), we are committed to the company’s goal of empowering Indonesia and advancing Indonesia in the frontline of regional digital economy,” Vikram concluded.

This article is published in collaboration with Indosat Ooredoo Hutchison

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