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01/10 18:48
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call presents a mixed picture. Financial performance shows slight revenue growth and stable EBITDA margins, but EBITDA has decreased. The company faces macroeconomic and competitive risks, and there's no share buyback plan. Guidance is cautious, with no strong catalysts for growth. Despite some positive aspects like digital business growth, the lack of clear dividend plans and competitive pressures balance the outlook. The Q&A reveals cautious optimism but no strong positive signals. Overall, these factors suggest a neutral stock price movement.
Revenue IDR 150 trillion, up 0.5% year-on-year, supported by consumer enterprise and wholesale international business.
EBITDA IDR 75 trillion, down 3.3% year-on-year, attributed to investment in talent rejuvenation via early retirement program; normalized EBITDA at IDR 76.2 trillion, down 1.8% year-on-year.
Operating Net Income IDR 24.1 trillion, up 4.1% year-on-year, after excluding impacts from early retirement program and asset unlocking.
Total Expenses IDR 107 trillion, up 2% year-on-year; operating expenses grew 4.6% year-on-year to IDR 74.9 trillion.
CapEx IDR 24.5 trillion, with a realization to revenue ratio of 16.3%, lower due to underspend allocation from data center and back-end loaded spending.
Consumer Business Revenue (Telkomsel) IDR 113.3 trillion, up 10.7% year-on-year, driven by fixed mobile conversion adoption and improved revenue quality.
Digital Business Revenue IDR 78.3 trillion, up from 88% to 90.3% of mobile revenue, supported by strategic cross-selling and data payload growth.
Wholesale and International Business Revenue IDR 18 trillion, up 6.4% year-on-year, driven by digital infrastructure and international wholesale voice business.
Enterprise Segment Revenue IDR 20.6 trillion, up 5.6% year-on-year, driven by NDBs, satellite services, and e-payment business.
Convergence Ratio 57% as of December 2024, indicating successful integration of services.
Digital Business Revenue Growth: Digital business raised its sale of mobile revenue to 90.3% from 88% previously, amounting to IDR 78.3 trillion, reinforcing digital business as Telkomsel's primary mobile revenue driver.
Fixed Mobile Convergence Initiative: The convergence ratio reached 57% as of December 2024, supporting consumer retention and strengthening defensive value.
One Billing Integration: Successful completion of One Billing Integration enhances fixed mobile convergence capabilities and lays the foundation for long-term wholesale revenue growth.
Consumer Fixed Broadband Subscriber Growth: Consumer fixed broadband subscriber grew by 2.5% on a quarterly basis to 9.6 million, indicating traction in broadening the customer base.
Mitratel Fiber Optic Acquisition: Mitratel completed acquisition of over 8,000 kilometers of fiber optic, increasing total length under management to 51,039 kilometers.
CapEx Efficiency Improvement: CapEx realization to revenue was at 16.3%, with lower realized CapEx due to underspend allocation from data center and back-end loaded spending.
Cost Leadership Initiative: Targeting CapEx to revenue to around 17% to 19% by 2028 to maintain cost leadership.
Corporate Transformation Group: Ensured all business processes achieve efficient results with no duplication processes as part of the Five Bulk Move strategy.
Strategic Partner Selection for Data Center: In the final stage of strategic partner selection to unlock value and optimize core competence in data center businesses.
Macroeconomic Conditions: The company faces risks from softness in macroeconomic conditions due to increased global volatility, which may impact revenue growth and consumer spending.
Competitive Pressures: The rising competitive environment in the telecommunications sector poses challenges to maintaining market share and profitability.
Regulatory Issues: Potential regulatory changes, particularly in the context of Indonesia's presidential election and its impact on economic policies, could affect operational strategies.
Supply Chain Challenges: The company is navigating supply chain challenges, particularly in the context of capital expenditures and procurement initiatives.
Economic Factors: External pressures, including geopolitical tensions and global trade disputes, may impact industry growth and spending patterns.
Legacy Revenue Headwinds: The ongoing shift from legacy revenue streams to digital platforms presents risks in maintaining revenue stability.
Inflationary Pressures: Inflationary periods have weakened purchasing power in Indonesia, which could affect consumer spending on telecommunications services.
CapEx Efficiency: The need for improved capital expenditure efficiency is critical, especially in light of the anticipated economic challenges.
One Billing Integration: Successful completion of One Billing Integration enhances fixed mobile convergence capabilities and lays the foundation for long-term wholesale revenue growth.
Five Bulk Move Strategy: Implementation of the Five Bulk Move strategy aims to achieve efficient results with no duplication processes.
CapEx Reduction Initiatives: Strategic initiatives to lower CapEx for consumer premise equipment and network have improved through group procurement initiatives.
Data Center Partnerships: Final stage of strategic partner selection to unlock value in data center businesses, aiming for conclusion in 2025.
Establishment of InfraCo: Establishment of PT Telecom Infrastructure Indonesia (TIF) to improve asset deployment efficiency and increase CapEx efficiency.
2025 Revenue Growth Guidance: Conservatively guiding revenue growth within low single digits for 2025.
EBITDA Margin Guidance: Maintaining EBITDA margin range guideline at 50% to 52% for 2025.
CapEx to Sales Guidance: Adjusted CapEx to sales range guidance to 17% to 19% for 2025.
Long-term CapEx Target: Targeting CapEx to revenue to around 17% to 19% by 2028.
Share Buyback Program: None
The earnings call presents a mixed picture. Financial performance shows slight revenue growth and stable EBITDA margins, but EBITDA has decreased. The company faces macroeconomic and competitive risks, and there's no share buyback plan. Guidance is cautious, with no strong catalysts for growth. Despite some positive aspects like digital business growth, the lack of clear dividend plans and competitive pressures balance the outlook. The Q&A reveals cautious optimism but no strong positive signals. Overall, these factors suggest a neutral stock price movement.
The earnings call reveals mixed signals: modest revenue growth, but declining EBITDA and operating income due to increased expenses. The Q&A highlights competitive pressures and unclear management responses, especially on synergy and monetization strategies, which are concerning. The lack of shareholder return plans and no new partnerships or strong guidance further contribute to a neutral sentiment. Despite some growth in digital and fixed broadband, the overall financial health remains challenged, resulting in an anticipated neutral stock price movement.
The earnings call presents a mixed picture. While there is growth in key areas like mobile and digital business revenues, concerns arise from declining ARPU and flat subscriber growth. The Q&A highlights management's cautious optimism, but lack of clarity on certain issues raises uncertainties. Despite positive developments like fiber optic expansion and cost optimization targets, the overall sentiment remains balanced, resulting in a neutral outlook for the stock price.
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