telkom infomemo 1h12

7/29/2019 Telkom Infomemo 1H12

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T H E F I R S T H A L F 2 0 1 2 R E S U L T S ( U N A U D I T E D )

TICKERS:IDX : TLKMNYSE : TLKLSE : TKID

ISSUED SHARES:20,159,999,280 shares

SHAREHOLDER COMPOSITION:Govt. of Indonesia : 53.8%Public : 46.2%Excl. Treasury stock 975,724,460 shares.

CONVERSION RATES (US$ 1.00):June 30, 2012 = Rp9,392.5June 30, 2011 = Rp8,575.5

FINANCIAL PERFORMANCERevenue(in Rp. Bn)

OPERATIONAL PERFORMANCESubscribers (million)

HighlightOur consolidated revenue in 1H 2012 grew by 6.8% YoY to Rp36.7 trillion and our celullarsubsidiary recorded a 9.5% YoY revenue growth to Rp25.4 trillion.Our broadband users grew by 12.9% QoQ:o Fixed broadband users grew by 3.9% to 2.0 millions.o Mobile broadband/flash users reached 5.8 millions, with 10.8% increase.o Blackberry users kept growing significantly 21.1% to 4.1 million.Cellular customer base increased 14.6% YoY to 117.2 million, with total net-add 10.2

million in 1H12.

Investor RelationsPT Telekomunikasi Indonesia TbkGrha Citra Caraka, 5th FloorJl. Gatot Subroto No. 52, JakartaPhone : 62 21 5215109Fax : 62 21 5220500Email : [email protected] : www.telkom.co.id

DISCLAIMERThis document contains financial conditions and result of operation, and may also contain certainprojections, plans, strategies, and objectives of the Company, which would be treated as forward lookingstatements within the meaning of applicable law. Forward looking statements, by their nature, involve riskand uncertainty that could cause actual results and development to differ materially from those expressed orimplied in these statements. Telkom Indonesia does not guarantee that any action, which may have beentaken in reliance on this document, will bring specific results as expected.

Financial HighlightsKey Indicators YoY QoQ

(Rp. Bn) 1H11 1H12 Growth(%)

3Q11 4Q11 1Q12 2Q12 Growth(%)

Revenues 34,371 36,720 6.8 18,462 18,418 17,796 18,924 6.3Expenses 23,322 24,801 6.3 13,331 13,317 11,756 13,045 11.0Profit beforeFinance(cost)/income & Tax 11,317 12,298 8.7 5,251 5,380 6,220 6,078 (2.3)EBITDA 18,073 19,282 6.7 9,031 9,451 9,623 9,659 0.4EBITDA Margin (%) 52.6 52.5 (0.1) 48.9 51.3 54.1 51.0 (3.0)Net Income 5.940 6,428 8.2 2,445 2,581 3,322 3,106 (6.5)

Operational Highlights

Subscriber (000)YoY QoQ

1H11 1H12 Growth(%)

3Q11 4Q11 1Q12 2Q12 Growth(%)

Fixed Broadband/ Speedy 2,000 1,957 (2.2) 2,184 1,789 1,884 1,957 3.9Mobile Broadband/ Flash 5,190 5,807 11.9 5,948 5,532 5,241 5,807 10.8Blackberry 2,195 4,055 84.7 3,039 3,153 3,348 4,055 21.1

Total 9,385 11,819 25.9 11,171 10,474 10,473 11,819 12.9

Postpaid 2,202 2,119 (3.8) 2,213 2,188 2,213 2,119 (4.2)

Prepaid 100,089 115,116 15.0 101,936 104,829 107,668 115,116 6.9Total 102,291 117,235 14.6 104,149 107,017 109,881 117,235 6.7

LIS Wireline 8,420 8,774 4.2 8,510 8,602 8,686 8,774 1.0LIS Wireless 18,736 16,237 (13.3) 18,085 14,238 15,123 16,237 7.4

Postpaid 525 428 (18.6) 520 468 426 428 0.4Prepaid 18,210 15,809 (13.2) 17,565 13,770 14,697 15,809 7.6

Total 27,156 25,011 (7.9) 26,595 22,839 23,809 25,011 5.0


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THE FIRST HALF 2012 (UNAUDITED)

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PT TELEKOMUNIKASI INDONESIA, Tbk.THE FIRST HALF 2012 RESULTS (UNAUDITED)

The following analysis and discussion is based on our Indonesian GAAP financial statements for thesix months ended June 30, 2011 and 2012. The reports have been submitted to BAPEPAM-LK, theIndonesia Capital Market and Financial Institutions Supervisory Agency, and to US Securities andExchange Commission.

FINANCIAL RESULTSRevenues

Key Indicators YoY QoQ(Rp. Bn) 1H11 1H12 Growth(%) 3Q11 4Q11 1Q12 2Q12

Growth(%)

Cellular 13,532 14,666 8.4 7,411 7,655 7,197 7,469 3.8Fixed Line 5,865 5,565 (5.1) 2,882 2,871 2,805 2,760 (1.6)

Data, Internet & IT 11,548 12,742 10.3 6,353 6,023 6,115 6,627 8.4Interconnection 1,678 1,910 13.8 948 883 876 1,034 18.0Network 629 624 (0.8) 325 346 306 318 3.9Other 1,119 1,213 8.4 543 640 497 716 44.1Total 34,371 36,720 6.8 18,462 18,418 17,796 18,924 6.3

We made total revenue of Rp36.7 trillion in 1H12, an increase of 6.8% YoY. Cellular revenues is stillthe largest contributor followed by Data, internet and IT services as the second contributor. Totalrevenue increased by 6.3% QoQ with details are as follows:

Cellular revenues increased by 3.8% QoQ resulting from the increase of local and long distanceusage revenue due to the school holiday season. It was an 8.4% YoY increase due to the betterpricing compared to last year.

Fixed line revenues , consisted of fixed wireline and fixed wireless voice revenues, slightlydecreased by 1.6% QoQ.

o Fixed wireline revenue decreased by 1.5% or amounting to Rp37.2 billion as a result ofdecrease in local and long distance usage revenue.

o Fixed wireless revenue decreased by 2.7% or amounting to Rp8.9 billion as results ofcombined impact of decrease in local usage and increase in long distance usage revenue.

Data, Internet & IT Services revenues increased 8.4% QoQ. The increase was contributed by

SMS revenue that increased by 10.9% QoQ or amounting to Rp301.3 billion, mostly derived fromcelullar SMS. Followed by increase in cellular data of Rp94.3 billion or 6.0% QoQ, increase in ITService of Rp49.9 billion or 59.4% QoQ, and increase in other data communication such asDINAccess and Ethernet revenue of Rp55.5 billion or 89.3% QoQ.

Interconnection revenues increased by 18.0% QoQ or amounting to Rp157.3 billion mostlyderived from domestic cellular interconnection and partly because of the implementation of SMSinterconnection that effectively started on June 1, 2012.

Network revenues increased by 3.9% QoQ or amounting to Rp12.1 billion as a result ofcombined impact of the increase in leased lines revenue by Rp18.1 billion and the decrease intransponder revenue by Rp6.0 billion.

Other revenues increased by 44.1% QoQ or amounting to Rp218.8 billion. The increase mostlycontributed by directory assistant revenue, CPE & Terminal revenue and tower businessrevenues.


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Expenses

Key Indicators YoY QoQ

(Rp. Bn)1H11 1H12 Growth(%) 3Q11 4Q11 1Q12 2Q12

Growth(%)

Operation & Maintenance 8,222 8,235 0.2 4,343 3,806 3,916 4,319 10.3Personnel 3,753 4,165 11.0 2,590 2,212 2,047 2,118 3.5Interconnection 1,598 2,131 33.3 933 1,025 995 1,136 14.2Marketing 1,554 1,460 (6.1) 816 908 635 825 29.9General Administrative 1,171 1,447 23.6 749 1,016 580 867 49.5Depreciation & Amortization 7,150 6,967 (2.6) 3,632 4,080 3,465 3,502 1.1Loss/(gain) on forex, shareof profit associated comp. &others expenses (126) 396 (414.4) 268 270 118 278 135.6Total 23,322 24,801 6.3 13,331 13,317 11,756 13,045 11.0

Compared to last quarter results, total expenses increased by 11.0% with the following details: Operation & Maintenance (O&M) expenses increased by 10.3% QoQ or amounting to

Rp403.9 billion. This increase was inline with the additional infrastructure in our cellularsubsidiary. The main contributors to the increase were O&M expenses for antenna, tower, radiocarrier equipment, radio base station, also the related O&M outsourcing, customers CPE, andhandset, modem and SIM card expenses. The other supporting facilities such as operationalvehicle and power expenses remained stable.

Personnel expenses increased by 3.5% QoQ or amounting to Rp71.0 billion mostly due to theincrease in tax allowance and early retirement expense for the newly appointed BOD as they areno longer as companys employees.

Interconnection expenses increased by 14.2% QoQ or amounting to Rp140.2 billion that whichwas contributed by increase in both domestic (implementation of SMS interconnection) andinternational interconnection charges.

Marketing expenses increased by 29.9% QoQ or amounting to Rp190.8 billion mostly due toincrease in sales support fees and advertising expense.

General & Administrative expenses increased by 49.5%QoQ. The increase mostly contributedby the increase in severance payment for the former BOD and BOC as decided in the last AGM,they were no longer servicing the company. Another increase were coming from socialcontribution expense.

Depreciation & Amortization expenses slighty increased by 1.1% QoQ or amounting toRp37 billion was a result of combination impact of the increase in switching depreciation expenseand the decrease in transmission equipment depreciation expense.

In 2Q12, total non-recurring expenses spent in General & Administrative expenses and Otherexpenses were Rp207 billion.

EBITDA, EBITDA Margin and Net IncomeFirst half 2012 EBITDA increased by 6.7% YoY to Rp19.3 trillion and 0.4% QoQ to Rp9.7 trillion andthe increases happened following the higher increase in revenue rather than the cost, regardless ofthe increase of expenses in 2Q12. The resulting EBITDA margin for 1H12 and 2Q12 is a bit lower0.1% YoY and 3.0% QoQ, to 52.5% and 51.0%, respectively.


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Net Income for 1H12 increased by 8.2% YoY to Rp6.4 trillion and decrease 6.5% QoQ toRp3.1 trillion.The basis to calculate the EBITDA is the expenses without forex exchange gain or loss, share ofprofit of associated companies, others-net and depreciation & amortization expenses.

Financial Position

Key Indicators YoY QoQ

(Rp. Bn)1H11 1H12 Growth(%) 3Q11 4Q11 1Q12 2Q12

Growth(%)

Assets 99,834 101,536 1.7 99,473 103,054 104,624 101,536 (3.0)Liabilities 44,548 43,717 (1.9) 41,234 42,073 40,237 43,717 8.6Non-controlling Interests 11,064 12,434 12.4 12,288 13,471 14,704 12,434 (15.4)Equity attributable toowners of the company 44,222 45,385 2.6 45,951 47,510 49,683 45,385 (8.7)

Decrease in assets by 3.0% QoQ was as a result of:

Decrease in Current assets. This was mainly due to decrease in cash and cash equivalent of2011 financial year dividend payment.

Slightly increase in Non-current assets. This was driven by the increase in the advances forassets purchasing/investments.

Increase in Liabilities by 8.6%QoQ was a result of:

Increase in Current Liabilities. This was attributable to the increase of trade payables, dividendpayables and the long-term liabilities that near to maturities.

Increase in Non-current liabilities. This was mostly contributed by the increase in banks loans.

Decrease in non-controlling interest of 15.4% QoQ was due to the decrease of non-controlling netassets of subsidiaries, notably of Telkomsels in the event of dividend payment.

Decrease in Equity of 8.7% QoQ was mainly due to 2011 financial year dividend payment made inJune 2012 and the additional of Treasury Stock in the Share Buy Back IV Program.

Cash FlowsKey Indicators YoY(Rp. Bn) 1H11 1H12 Growth(%)Cash Flow from Operating Activities 15,128 16,781 10.9Cash Flow from Investing Activities (5,558) (6,658) 19.8Cash Flow from Financing Activities (8,080) (11,233) 39.0

Net Increase (Decrease) in Cash & Cash Equivalent 1,490 (1,110) (174.5)Effect of Foreign Rate Changes (72) 58 (180.6)Cash & Cash Equivalents at Beginning of Periods 9,120 9,634 5.6Cash & Cash Equivalents at End of Periods 10,538 8,582 (18.6)

Net cash generated from operations increased by 10.9% YoY as a result of the cash revenuereceived from customers that compensated by the cash out for expense payment.

Net cash used for investment increased by 19.8% mostly due to the increase in cash spent forfixed assets acquisition.

Net cash used for financing activities increased by 39.0%. This was driven by the cash out fordividend payment and acquisition of treasury stock under Share Buy Back IV program, whichcompensated by the cash received from new banks loans.


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DebtsCurrencies YoY QoQ Portion (%)(Rp. Bn) 1H11 1H12 Growth(%) 1Q12 2Q12

Growth(%) 1H11 1Q12 2Q12

IDR/Rupiah 15,255 14,095 (7.6) 11,174 14,095 26.1 77.2 76.7 80.6USD/US Dollar 3,386 2,257 (33.3) 2,288 2,257 (1.3) 17.1 15.7 12.9JPY/JapaneseYen 1,131 1,135 0.4 1,112 1,135 2.1 5.7 7.6 6.5Total 19,772 17,487 (11.6) 14,574 17,487 20.0 100.0 100.0 100.0

Gearing

Key Indicators YoY

1H11 1H12 Growth

Net Debt to Equity (%) 18.5 19.3 0.8

Debt to Equity (%) 43.3 39.0 (4.3)Debt to EBITDA (%) 106.0 91.8 (14.2)

Debt Service Ratio (Times) 3.5 3.6 0.1

Our debts consisted of Two-Step Loans, Bonds, Notes and Banks Loans. During second quarter2012, we made repayment of Banks Loans, MTN and Notes of Rp129.0 billion, Rp52.8 billion andRp44.8 billion, respectively. We made new debts for working capital purposes in the form of Banksloans, Two-Step Loans and Notes amounting to Rp2.4 trillion, 646.0 billion and Rp102.8 billion,respectively.

Financial Ratio

Ratios YoY QoQ

(%)1H11 1H12 Growth(%) 3Q11 4Q11 1Q12 2Q12

Growth(%)

Profit Margin 32.9 33.5 0.6 28.4 29.2 35.0 32.1 (2.9)Profit for the year attributableto owners Margin 17.3 17.5 0.2 13.2 14.0 18.7 16.4 (2.3)EBITDA Margin 52.6 52.5 (0.1) 48.9 51.3 54.1 51.0 (3.0)Current Ratio 89.1 84.0 (5.1) 95.4 95.8 106.2 84.0 (22.2)Return on Assets 5.9 6.3 0.4 2.5 2.5 3.2 3.1 (0.1)Return on Equity 13.4 14.2 0.8 5.3 5.4 6.7 6.8 0.1Total Liabilities to Equity 100.7 96.3 (4.4) 89.7 88.6 81.0 96.3 15.3

Telkomsel Financial ResultAs a result of Telkomsels efforts to monetize traffic and to further grow our data business, and alsoour costs management programs, we recorded a strong financial results in the first half 2012.

Income StatementStatement of Income YoY QoQ(Rp. Bn) 1H11 1H12 Growth(%) 1Q12 2Q12

Growth(%)

Revenues 23,223 25,426 9.5 12,298 13,128 6.7Expenses (incl. Depreciation) 14,966 15,660 4.6 7,600 8,060 6.1

EBITDA 13,122 14,423 9.9 7,075 7,348 3.9EBITDA Margin (%) 56.5 56.7 0.2 51.5 55.9 (1.6)Net Income 5,986 7,295 21.9 3,505 3,790 8.1


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Telkomsel recorded a strong revenue growth in 1H12. It reached Rp25.4 trillion in 1H12, an increaseof 9.5% YoY. Compared to 1Q12 results, revenue increased 6.7% QoQ in 2Q12. All voice, SMS anddata services showed positive revenue growth during the first half of 2012.

Postpaid revenue grew slightly 1% YoY to Rp2.1 trillion in 1H12 due to increase in data and SMSrevenues combined with declining voice revenue. It declined 4% QoQ in 2Q12 due to the impactof chargeable traffic decline.

Prepaid revenue increased 12% YoY to Rp21.2 trillion in 1H12 and grew 6% QoQ in 2Q12, whichwas contributed by increase in revenues of all voice, SMS and data services.

International roaming revenue decreased 6% YoY to Rp329 billion due to the impact of specialinter operator tariff with some roaming partners. It was increased 30% QoQ in 2Q12 as there wasan impact from increasing traffic.

Interconnection revenue increased 3% YoY to Rp1.6 trillion, which was mainly due to increase indomestic interconnection, partly because of the implementation of SMS interconnection that

effectively started in June 2012. It grew 25% QoQ in 2Q12 mainly from SMS interconnection. Other revenues , resulted from network lease and USO compensation fee totalling Rp211 billion.

Non-voice revenues (SMS, Data & VAS) increased 14% YoY to Rp9.5 trillion and contributed 37% tototal revenues in 1H12.

We continued our efforts to manage our expenses growth. For the first semester 2012, expensesincreased only by 4.6% YoY to Rp15.7 trillion. The expenses increased by 6.1% from previousquarter. Operation & maintenance expenses, cost of services and interconnection charges were themain driver of total expenses growth in the first half of 2012.

Personnel expenses increased 23% YoY to Rp991 billion, which was due to the impact of

remuneration adjustment, monthly allocation of employee allowances and organizationrestructuring. It was up 6% QoQ in 2Q12.

Operation & maintenance expenses increased 5% YoY to Rp5.4 trillion in 1H12 and grew 5%QoQ in 2Q12, both was mainly due to increasing network space rental in line with the growth ofnumber of BTS and Node B.

General & administration expenses increased 7% YoY to Rp439 billion in 1H12 and grew 22%QoQ in 2Q12, which was in-line with the growth of business activities.

Marketing expenses decreased 11% YoY to Rp904 billion in 1H12, which was mainly on loweradvertising and promotion expenses. It was up 25% QoQ in 2Q12 due to increase in advertising &promotion expenses and sales outlet development.

Interconnection charges (domestic and international) increased 11% YoY to Rp1.4 trillion in 1H12and grew 29% QoQ in 2Q12, which was contributed by increase in both domestic (impact of theimplementation of SMS interconnection) and international interconnection charges.

Cost of Services grew 29% YoY to 1.9 trillion in 1H12 due to increase in data access fees in linewith the growth of Telkomsel data services, particularly for blackberry. It increased 9% QoQ in2Q12.

Depreciation expense decreased 6% YoY to Rp4.7 trillion in 1H12, mainly due to accelerateddepreciation recorded in 1H11. It declined 4% QoQ.

Others-net decreased 74% YoY to a net gain of Rp41 billion mainly due to foreign exchange lossrecorded in 1H12, compared to a gain on foreign exchange in 1H11, resulted from thedepreciation of the rupiah.


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Net finance costs (interest income and financing charges) declined 93% YoY to Rp17 billion resultedmainly from decrease in financing charges due to debt repayment.

Financial Position

Total Assets increased by 3% YoY to Rp56.4 trillion. Total liabilities decreased by 10% to Rp21.0trillion, while total equity increased 12% to Rp35.4 trillion.

Current assets increased 37% to Rp8.3 trillion, mainly due to increase in cash and cashequivalent.

Fixed assets decreased 2% to Rp45.2 trillion as a result of network infrastructure growthcombined with the impact of accelerated depreciation of fixed-assets.

Current liabilities increased 8% to Rp15.4 trillion mainly due to increase of accrued liabilities anddividend payable combined with the decline of loans.

Non-current liabilities decreased 38% to Rp5.6 trillion, mainly due to the repayment of medium-term loans.

Cash FlowsNet cash generated from operations in 1H12 was Rp13.7 trillion, increased 14% compared to 1H11,as a result of increase in revenues. Cash flow for investing activities, which was mostly spent for theacquisition of network infrastructures, increased 35% to Rp4.4 trillion (approximately USD 478million). Net cash used in financing activities increased 2% to Rp1.4 trillion.

STATEMENT OF CASH FLOWS AS OF JUNE 31, 2011 AND 2012 (In Billions of Rupiah)

1H11 1H12

Cash Flow from Operating Activities 12,047 13,711

Cash Flow for Investing Activities (3,265) (4,418)

Cash Flow from Financing Activities (1,415) (1,439)

Dividend (6,755) (7,848)

Net Increase in Cash & Cash Equivalents 612 6

Effect of Foreign Exchange Rate Changes (21) 37

Cash and Cash Equivalents at Beginning of Periods 1,222 4,223

Cash and Cash Equivalents at End of Periods 1,812 4,266

Addition to Fixed Assets (incl. CIP) 2,862 4,282

Loan/ DebtTelkomsel has agreed on certain financial covenants related to its loans/debts. As of June 30, 2012these covenants were as follows:

Covenant t/b maintained Required Actual

Bank Loans EBITDA to Debt Service 1.25 5.87Debt to Tangible Net Worth 2.00 0.12


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OPERATIONAL RESULTS

Broadband Services

Customer Base Fixed Broadband

2.0 million users, a 2.2% YoY decrease and 3.9% QoQincrease.

Mobile Broadband 5.8 million Flash users, a 11.9% YoY growth and 10.8%QoQ increase. Telkomsels BlackBerry customersreached 4.1 million, a 84.7% YoY growth. Total number ofdata users including of pay-as-you-use reached 47million, grew 82% from the same period last year.

ARPU & Traffic Production Fixed Broadband

2Q12 ARPU was Rp185 thousand, a 1.8% decrease compared to ARPU of previous quarter. 1H12 ARPU was Rp186 thousand, a 2.9% increase YoY. We maintained Speedy customers monthly usage growing 6.0% YoY which brought 1H12

Speedy revenue of Rp2.1 trillion, an increase of 6.8% YoY.

Mobile BroadbandWith the growth of Telkomsel data users including of pay-as-you-use, data traffic/payloadcontinued to show a significant growth in 1H12, which reached 22,876 terabytes, grew 98% YoYfrom 1H11.

New Products & Programs Mobile Broadband

In April 2012, we launched simPATI Opera Mini & WhatsApp promotion to provide affordableinternet access tariff as low as Rp 0.5/Kb with 3.5G technology support.

Kartu As 30 hours promotion was introduced to customers in June 2012 which valid for new andexisting Kartu As Rp0 subscribers through *100# access. The promotion provided extra 300minutes to be used up to 30 hours and also 1 MB data for Facebook, Twitter and chatting access.

Cellular Services

Customer BaseAt the end of June 2012, Telkomsel customer reached 117.2million customers, which consisted of 2.1 million postpaidsubscribers and 115.1 million prepaid subscribers. Itrepresents an estimated 45% share of the full mobility market,an improvement from 43% of last quarter. The total subscribersgrew by 14.6% YoY or 6.7% from previous quarter. For the firsthalf 2012, Telkomsel recorded a strong new customer additionwith 10.2 million customers, 23% higher than net customeraddition in 1H11.


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Traffic Production & ARPUTotal outgoing minutes of use (MoU, chargeable and non-chargeable) increased 4% YoY to 88.0billion minutes in 1H12. In 2Q12, the total outgoing MoU production was 5% higher than total MoUproduction in 1Q12.

Total SMS production (chargeable and non-chargeable) during 1H12 increased 12% YoY to126.4 billion units. The SMS production increased 4% QoQ to 64.4 billion units in this quarter.

Blended ARPU for 1H12 was Rp36 thousand, which declined 4% YoY. ARPU has declined during thelast few years due to the impact of multiple SIM cards holders phenomenon and penetration to lowermarket segments. However, ARPU in 2Q12 slightly improved 2.8% to Rp37 thousand from Rp36thousand in 1Q12.

New Products & ProgramsIn June 2012, a new kartuHALO Fit was introduced, offering more voice, SMS and data; widest HSPA

coverage; data access priority up to 7.2 Mbps; best rate for IDD & international roaming service andvariety of special offers.

Network DevelopmentTo support high demand on data, Telkomsel has expedited new BTS deployment. We added 4,631new BTSs in 1H12, of which 1,655 units were 3G Node-B. As at end of June 2012, Telkomsels totalBTS on air reached 47,254 units, including 11,164 units 3G Node-B, an increase of 19.3% from thesame period last year.

The following table presents a comparison of our cellular business performance:

Key Indicators UnitYoY QoQ

1H11 1H12Growth

(%) 3Q11 4Q11 1Q12 2Q12Growth

(%)

Total CustomerPostpaid (kartuHALO) Subs (000) 2,202 2,119 (3.8) 2,213 2,188 2,213 2,119 (4.2)Prepaid (simPATI +Kartu As) Subs (000)

100,089 115,116 15.0 101,936 104,829 107,668 115,116 6.9

Total Subs (000) 102,291 117,235 14.6 104,149 107,017 109,881 117,235 6.7Net AddPostpaid (kartuHALO) Subs (000) 75 (69) (192.0) 11 (26) 25 (95) (480)Prepaid (simPATI +Kartu As) Subs (000)

8,205 10,287 25.4 1,847 2,893 2,839 7,448 162.3

Total Subs (000) 8,280 10,218 23.4 1,858 2,867 2,864 7,353 156.7

MoU (chargeable) Bn Minutes 83 69 (16.9) 38 39 35 34 (5.1)SMS (chargeable) Bn Units 51 56 10.4 28 30 30 27 (10.7)

Postpaid (kartuHALO) Rp.'000 per mo 198 184 (7.1) 196 197 183 185 1.1Prepaid (simPATI +Kartu As) Rp.'000 per mo 34 33 (2.9) 37 35 33 34 3.0Blended Rp.'000 per mo 38 36 (5.3) 40 38 36 37 2.8

BTS Unit 39,609 47,254 19.3 41,037 42,623 44,797 47,254 5.5

Total employees Person 4,409 4,448 0.9 4,402 4,417 4,422 4,448 0.6

Efficiency ratio 000Subs/employee 23 26 13.6 24 24 25 26 7.7


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Fixed Line Services

Customer Base Fixed Wireline

8.8 million customers, 4.2% growth from last year and 1.0% increase from last quarter.

Fixed Wireless16.2 million customers at the end of 2Q12, consisting of 428 thousand postpaid subscribers and15.8 million prepaid subscribers. Compare to previous quarter, fixed wireless customersincreased by 7.4%.

ARPU Fixed Wireline

2Q12 ARPU was at Rp90 thousand, a decrease 1.8% QoQ. 1H12 ARPU was Rp91 thousand, adecrease 10.3% YoY.

Fixed Wireless2Q12 blended ARPU was at Rp9.2 thousand, a 9.8% decrease QoQ. 1H12 ARPU was Rp10thousand, a 5.3% YoY increase.

Network DevelopmentUp to end of first half 2012, we have 5,715 Flexis BTSs covering 370 cities.

The following table presents a comparison of Flexi performance:

Key Indicators UnitYoY QoQ

1H11 1H12 Growth(%) 3Q11 4Q11 1Q12 2Q12Growth

(%)

Total CustomerPostpaid (Classy) SSF (000) 525 428 (18.6) 520 468 426 428 0.4Prepaid (Trendy) SSF (000) 18,210 15,809 (13.2) 17,565 13,770 14,697 15,809 7.6Total SSF (000) 18,736 16,237 (13.3) 18,085 14,238 15,123 16,237 7.4

Net AddPostpaid (Classy) SSF (000) (21) (40) (89.1) (5) (53) (42) 2 104.4Prepaid (Trendy) SSF (000) 596 2,039 242.3 (646) (3,795) 927 1,112 (19.9)Total SSF (000) 575 1,999 247.9 (651) (3,848) 886 1,113 (25.7)

MoU Mn Minutes 4,528 2,878 (36.4) 1,781 1,686 1,472 1,406 (4.5)SMS Mn Units 1,809 1,223 (32.4) 712 672 666 557 (16.4)

Postpaid (Classy) Rp.'000 77 86 14.3 77 80 84 88 5.6Prepaid (Trendy) Rp.'000 7 7 - 7 7 8 7 (11.6)Blended Rp.'000 9 10 5.3 9 10 10 9 (9.8)

BTS Unit 5,705 5,715 0 5,708 5,715 5,715 5,715 0Coverage Cities 370 370 0 370 370 370 370 0


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ADDITIONAL INFORMATION

Capital ExpenditureFor the first half 2012, paid Capex of Telkom, Telkomsel and other subsidiaries were amounting toRp1.8 trillion, Rp4.4 trillion and Rp1.1 trillion respectively. Telkoms Capex was mainly utilized forenhancing backbone and access infrastructure to support the broadband and for Telkom-3 satellite.Meanwhile, Telkomsel's Capex was utilized for radio access network. Other Subsidiaries Capex wasutilized among others for erecting tower and developing infrastructure.

Share Buyback IV ProgramAs of June 30, 2012, under the SBB IV program we have bought back 485.1 million shares in theIndonesian Stock Exchange (IDX) and New York Stock Exchange (NYSE) amounting toRp3.5 trillion or 69.6% from total target Rp5 trillion. The program will expire on November 2012. Itmade our total treasury stocks totalled 975.7 million shares.

Awards & RecognitionDuring 2Q 2012, we have been awarded by several institution for our achievements, among others:

Awards of the Best CDMA Operator for Telkom Flexi and The Best GSM Operator and The BestOperator of The Year for Telkomsel in the Cellular Award 2012 in Jakarta.

Infomedia won The Best Contact Center Indonesia 2012 awarded by Indonesia Contact CenterAssociation (ICCA) in Jakarta.

2011 Vision Awards - Annual Report Competition in Gold class for the category ofTelecommunications Industry in International Annual Report Award conducted by League ofAmerican Communications Professionals LLC (LACP) in San Diego, US.

Cellular Award 2012 for Telkomsel as The Best Operator of The Year for nine consecutive yearsand The Best GSM Operator from Selular Magazine.

Indonesia Cellular Award (ICA) 2012 for The Best Data Package (GSM & CDMA) category fromSinyal Tabloid.

Word of Mouth Marketing (WOMM) Award 2012 as the first winner in GSM postpaid category,GSM prepaid category and for BlackBerry internet service category from SWA Magazine andOnBee Marketing Research.


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Table 1PERUSAHAAN PERSEROAN (PERSERO)

PT. TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF FINANCIAL POSITION

DECEMBER 31, 2011 (AUDITED) AND JUNE 30, 2012 (UNAUDITED)

(figures are presented in billions of Rupiah)

DEC 31, 2011 JUN 30, 2012ASSETS

CURRENT ASSETSCash and cash equivalents 9,634 8,582Available-for-sale financial assets 361 349Trade receivables

Related parties 932 1,440Third parties 3,983 4,115

Other receivables 335 259Inventories 758 710Advances and prepaid expenses 3,294 3,029Claims for tax refund 371 656Prepaid taxes 787 218Asset held-for-sale 791 516Other current assets 12 5

Total Current Assets 21,258 19,879

NON-CURRENT ASSETSLong-term investments - net 235 220Property, plant and equipment 74,897 74,506Prepaid pension benefit cost 991 1,013Advances and other non-current assets 3,817 4,187Intangible assets 1,789 1,658Deferred tax assets 67 73

Total Non-current Assets 81,796 81,657

TOTAL ASSETS 103,054 101,536


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Table 1 (Continued)PERUSAHAAN PERSEROAN (PERSERO)

PT. TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF FINANCIAL POSITION

DECEMBER 31, 2011 (AUDITED) AND JUNE 30, 2012 (UNAUDITED)(figures are presented in billions of Rupiah)

DEC 31, 2011 JUN 30, 2012LIABILITIES AND EQUITY

CURRENT LIABILITIESTrade payables

Related parties 838 828Third parties 7,479 7,269

Other payables 37 42Taxes payables 1,039 2,023Dividend Payables 1 745Accrued expenses 4,790 4,618Unearned income 2,821 2,839Advances from customers and suppliers 271 328Short-term bank loans 100 284Current maturities of long-term liabilities 4,813 4,697

Total Current Liabilities 22,189 23,673

NON-CURRENT LIABILITIESDeferred tax liabilities 3,794 3,590Unearned income 242 213Long service awards provisions 287 287Post-retirement health care benefit provisions 888 754Retirement benefits obligation 1,715 1,997Long-term liabilities - net of current maturities

Obligations under finance leases 314 289Two-step loans - related party 2,012 1,937Bonds and Notes 3,401 3,389Bank loans 7,231 7,588

Total Non-current Liabilities 19,884 20,044

TOTAL LIABILITIES 42,073 43,717

EQUITY

EQUITY ATTRIBUTABLE TO OWNERS OF THE PARENTCapital stock - Rp.250 par value per Series ADwiwarna share and Series B share

Authorized - 1 Series A Dwiwarna share and79,999,999,999 Series B sharesIssued and fully paid - 1 Series A Dwiwarna shareand 20,159,999,279 Series B shares 5,040 5,040

Additional paid-in capital 1,073 1,073Treasury stock (6,323) (7,747)Difference in value arising from restructuring transactions and other

transactions between entities under common control 478 478Difference due to change of equity in associated

companies 386 386Unrealized holding gain from available-for-sale securities 47 46Translation adjustment 240 240Difference due to acquisition of non-controlling interest in subsidiaries (485) (485)Retained earnings

Appropriated 15,337 15,337Unappropriated 31,717 31,017

Total Equity Attributable To Owners Of The Parent 47,510 45,385

Non-Controlling Interest 13,471 12,434

TOTAL EQUITY 60,981 57,819

TOTAL LIABILITIES AND EQUITY 103,054 101,536


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Table 2PERUSAHAAN PERSEROAN (PERSERO)

PT. TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

SIX MONTHS PERIOD ENDED JUNE 30, 2011 AND 2012 (UNAUDITED)(in billions of Rupiah, except per share and per ADS data)

2011 2012

REVENUES 34,371 36,720

Other Income 268 379

EXPENSESOperations, maintenance and telecommunication services (8,222) (8,235)Depreciation and amortization (7,150) (6,967)Personnel (3,753) (4,165)Interconnection (1,598) (2,131)Marketing (1,554) (1,460)General and Administrative (1,171) (1,447)Gain (loss) on foreign exchange net 194 (213)

Share of gain (loss) of associated companies 1 (3)Others expense (69) (180)Total Expenses (23,322) (24,801)

PROFIT BEFORE FINANCE (COST) INCOME AND INCOME TAX 11,317 12,298

Finance income 284 271Finance costs (819) (565)Total Finance Costs net (535) (294)

PROFIT BEFORE INCOME TAX 10,782 12,004

INCOME TAX (EXPENSE) BENEFITCurrent (2,752) (3,230)Deferred 7 215

(2,745) (3,015)

PROFIT FOR THE PERIOD 8,037 8,989

OTHER COMPREHENSIVE INCOMEForeign currency translation (10) -Change in fair value of available-for-sale financial assets (2) (1)

Total Other Comprehensive Income net of tax (12) (1)

TOTAL COMPREHENSIVE INCOME FOR THE PERIOD 8,025 8,988

Profit for the period attributable to:Owners of the parent 5,940 6,428Non-controlling interest 2,097 2,561

8,037 8,989Total comprehensive income attributable to:

Owners of the parent 5,928 6,427Non-controlling interest 2,097 2,5618,025 8,988

BASIC EARNIGS PER SHAREIncome per share 302.05 333.97Income per ADS (40 Series B shares per ADS) 12,082.00 13,358.80


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Table 3PT. TELEKOMUNIKASI SELULAR (TELKOMSEL) AND SUBSIDIARIES

STATEMENT OF FINANCIAL POSITIONDECEMBER 31, 2011 (AUDITED) AND JUNE 30, 2012 (UNAUDITED)

(figures are presented in billions of Rupiah, otherwise stated)

DEC 31, 2011 JUN 30, 2012ASSETSCURRENT ASSETS

Cash & cash equivalents 4,223 4,266Accounts receivables including Unbilled revenues 1,038 892Prepayments 2,472 1,776Others 2,122 1,400Total Current Assets 9,855 8,334

NON-CURRENT ASSETSLong-term investment 20 20Fixed assets-net 46,208 45,245Advances for fixed assets 530 585Intangible assets-net 1,033 999Prepayments Non Current Portion 947 1,001Others 129 183Total Non-Current Assets 48,868 48,033

TOTAL ASSETS 58,723 56,367

LIABILITIES AND EQUITYCURRENT LIABILITIES

Accounts payable & Accrued Liabilities 8,466 8,210Taxes payable 760 1,151Unearned revenue 2,478 2,509Dividend payable - 2,052Current maturities of medium-term & long-term loans 2,271 1,468Total Current Liabilities 13,975 15,390

NON-CURRENT LIABILITIESMedium-term & long-term - net of current maturities 3,486 2,757Deferred tax liabilities 2,363 2,156Others 523 651

Total Non-current Liabilities 6,372 5,564

EQUITYCapital Stock - Rp1,000,000 par value

Authorized - 650,000 shares

Issued and fully paid - 182,570 shares 183 183Additional paid-in capital 1,505 1,505Retained earnings 36,688 33,725Total Equity 38,376 35,413

TOTAL LIABILITIES AND EQUITY 58,723 56,367


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