The company, controlled by Axiata of Malaysia, allocated Rp 7 trillion (US$506.8 million) in capital expenditure this year, 60 percent of which would be used to develop networks outside Java, said its service management director Yessie Dianty Yosetya.

“We mostly entered cities in 2017; in 2018 we will penetrate regencies and subdistricts,” she said in Jakarta on Friday.

President director Dian Siswarini said the company recorded satisfying results in 2017 by expanding its network outside Java, such as in Sumatra and Kalimantan.

It booked a 59 percent year-on-year (yoy) increase in the number of base transceiver station (BTS) towers on islands beyond Java last year, helping its revenue from those areas grow 49 percent yoy.

“There are five broadband players in Java, while outside [the island] we mostly compete with one player; it is easier to grab a slice of the pie there,” Dian said.

The other four broadband players are Telkomsel, Indosat Ooredoo, Sinarmas’ Smartfren and Lippo Group’s Bolt, she said. While outside Java, Telkomsel is the only dominant player.

The company booked 101,094 BTS towers as of 2017, a 19.4 percent increase from 84,484 BTS recorded a year earlier. Outside Java, the number of towers grew 58.7 percent yoy to 16,986 in 2017 from 10,700 in 2016.

As the number of its BTS towers was increasing, the company’s 4G penetration reached 360 cities last year, from 101 in 2016. The coverage was equal to 85 percent of the population from 18 percent in 2016.

Dian said the expansion helped the company increase traffic from smartphones, which were used by around 72 percent of XL Axiata’s customers last year, an increase from 63 percent in 2016.

She claimed the company was now focusing on data service, which accounted for 68 percent of its total revenue, higher than the average of other players.

Moreover, the company aims to enter the home fiber optics market in the second quarter as it allocates $500 million in multiyear investment.

“With less than 3 percent penetration, Indonesia has huge potential for fixed broadband. We are on target for a launch in the next quarter,” business development director Abhijit Jayant Navalekar said.

As for B2B solutions, XL Axiata plans to rejuvenate its XL Business Solutions brand by focusing on the internet of things (IoT) market and targeting double-digit revenue growth, said commercial director Allan Bonke.

The company’s shareholders approved on Friday its plan to abstain from paying dividends as it needed the funds for the investment.

The company’s net income in 2017 was slightly corrected by 0.07 yoy to Rp 375.24 billion, Rp 100 million of which will be kept as general reserve, while the remaining Rp 375.14 billion will be set for retained earnings.

This is the fourth time in a row XL has decided against paying dividends. In the 2014 financial year, the company experienced a net loss of Rp 803.71 billion, which lead to no dividend payment in 2015. Meanwhile, in 2016, it continued to abstain from paying dividends following net loss of Rp 25.33 billion.

After selling all of its stake in e-commerce Elevenia to Salim Group in 2017, the company was able to breathe easier, but did not have enough funds to pay dividends.

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