Full Year 2005 Results Page 1
PT Indosat Tbk
Full Year 2005 Results
Full Year 2005 Results Page 2
Key Business Segment
Cellular Business Fixed Telecom MIDI
Description – Second largest cellular operator in Indonesia
– Revenue comes primarily from IDD business (87%)
– Corporate Data Communications, Leased Lines, Satellite, Internet
Contribution(9M 2005) – 74.6% of revenue – 10.8% of revenue – 14.6% of revenue
Target Market Segment
– Corporate – Youth – Mass
Services • Matrix – Postpaid for high end with advanced features
• Mentari –Prepaid for general users
• IM3 – Prepaid for the young & trendy
• IDD 001• IDD 008• Flat call• StarOne
– Corporate– SME – Residential
– Wholesale – Corporate– Residential
• Frame Relay• Leased Circuits• Data Comms• Internet Access• VSATs
Indosat’s key businesses are Cellular, Fixed Telecom and MIDI
Full Year 2005 Results Page 3
Ownership Structure
Public
Listed on the JSX, SSX and NYSE with market cap of around Rp29.7 trilion(1)
Note:(1) Per 31 December 2005
Republic of Indonesia
40.54% 44.96% 14.50%
§ Indosat’s shares are majority owned by public investors (44.96%)
§ ST Telemedia through Indonesia Communications Limited owns (40.54%)
§ Indonesian Government owns 14.50% including Series A share
Full Year 2005 Results Page 4
Main Initiatives 2006
Enhanced Services for CustomerEnhance services in new regions
Enhance Product and Promotion Program
Expand Fixed Wireless network to 15 more cities
Committed to Good Corporate GovernanceExternal Auditor Limited Review for Quarterly Financial Statements
Enhance network Coverage, Quality and CapacityAround US$700 million capex in 2006, 85% for cellular network roll out
Adding more network elements, backbone and infrastructure
Finalize Cellular Network Integration
Continuing Cost efficiency programReduce overall cost of SIM Card and vouchers
Full Year 2005 Results Page 5
Major Achievements in 2005
14.5 million cellular subscribers with a cellular revenues growth of 17.7% (YoY)
IDD traffic increased by 12%, despite a decline in its revenues due to a tighter competition
EBITDA increased by 11.9%
MIDI revenues increased by 14.2% (YoY)
The successful financing program (US$ note and IDR bond) and decrease in cost of borrowing/debt
Realization of merger benefits (cost efficiencies)
Full Year 2005 Results Page 6
0.0
5,000.0
10,000.0
15,000.0
20,000.0
25,000.0
30,000.0
35,000.0
40,000.0
45,000.0
50,000.0
2002 2003 2004 2005
Indosat Indonesia
Cellular Services
§ Recording a high subs growth in recent years (CAGR 59% 2002-2005)
§ In the year of 2005 Indosat recorded net add of 4.7 million subs, hence the cellular subs base at end of 2005 was 14.5 million subscribers.
§ Indonesian cellular penetration is still relatively lower compared to other countries.
6%
21%
29%
40%
46%
67%
96%
India
Indonesia
China
Phillippines
Thailand
Malaysia
Singapore
Cellular Penetration (GSM) 1(dalam ribu)
Cellular Subscriber Growth
2002 -2005
Indosat CAGR 60%
Indonesia CAGR 59%
Notes : (1) Penetration data as Q3 2005, except Indonesia per 31 December 2005
Full Year 2005 Results Page 7
3,272
5,118
7,4518,645
2002 2003 2004 2005
Cellular Subscribers Composition
Subs composition as end of 2005 (in 000)
Postpaid5%
Prepaid95%
ARPU
0
50,000
100,000
150,000
200,000
250,000
300,000
2004 2005
Prepaid Postpaid Blended
Subs Composition as end of 2005
Non Java, 23%
Java, 77%
Cellular Operating Revenues(Rp billion)
2002 -2005 CAGR 38%
Full Year 2005 Results Page 8
MIDI14%
Cellular75%
SLI11%
Revenues Composition (2005)
§ Fixed telecommunication contributed 11% to operating revenues. IDD contributed 87% to fixed telecom revenues.
§ MIDI revenues increased 14.2% (YoY), mainly due to continued demand in Internet service and domestic leased circuit
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
1,000,000
2002 2003 2004 2005Outgoing Incoming
Fixed Telecommunication and MIDI
Trend in IDD Traffic(in thousands minutes))
60% 78%
27%40%
73% 84%
22% 16%
Full Year 2005 Results Page 9
Cellular Network Coverage
142Base Station Controllers
49Mobile Switching Centers
5,702Base Transceiver Stations
2005
Indosat Cellular CoverageNumber of BTS
Java61.7%
Non-Java
38.3%
Full Year 2005 Results Page 10
Financial Performance (YoY) In billion Rupiah
Operating Revenues Rp11,589.8 11.1%
Operating Income Rp3,651.9 14.2%
EBITDA Rp6,732.1 11.9%
Other Income (Expenses) (Rp1,299.2) 48.2%
Net Income Rp1,623.5 0.6%
(1) Restated for the early adoption of ‘SAK’’ 24 (Revised 2004), ‘‘Accounting for Employee Benefits’’, and SAK 38 (Revised 2004), ‘‘Accounting for Restructuring Transactions of Entities under Common Control’’.
(2) In 9M-04 we recorded pre-tax gain from the sale of our shares in subsidiaries amounting to Rp394.3 billion
Full Year 2005 Results Page 11
6,767
8,235
10,54911,590
2002 2003 2004 2005
3,6624,386
6,0536,732
54.1%
58.1%57.4%
53.3%
2002 2003 2004 2005
EBITDA EBITDA Margin
Revenues and EBITDA growth
Indosat recorded healthy revenues and EBITDA growth
(Rp billion)
Revenues EBITDA and EBITDA Margin(Rp billion)
2002 -2005 CAGR 20%2002 -2005 CAGR 23%
Full Year 2005 Results Page 12
Sound Balance Sheet
53.3%
57.7% 58.1%
2003 2004 2005
EBITDA Margin Interest Coverage
Debt to EBITDA Net Debt to Equity
190.7% 191.9%224.5%
2003 2004 2005
48.9%41.6%
54.4%
2003 2004 2005
531.4%
559.2%
542.6%
2003 2004 2005
Full Year 2005 Results Page 13
Composition of Assets & Liabilities
0
100
200
300
400
500
600
700
800
900
Others 371
Payables 215Bonds Payable 550Receivables 112
Cash & Equivalent 282
Liabilities Assets Net
In US$ million as of 31 December 2005
§ Indosat is relatively hedged against currency and interest rate fluctuations (98% of debts had fixed interest rate as of 31 December 2005).
§ Net liabilities in US$ was US$371.4 million of which US$275 million was hedged as of 31 December 2005. Cash and its Equivalent
(Per 31 Dec 2005 Total Rp 4,717.3 bio)
Rupiah41%
US$59%
Payables(Per 31 Dec 2005 Total Rp18,296.1 bio)
US$ 41%
Rp 59%
Full Year 2005 Results Page 14
Human Resources
Indosat employees comprise of permanent employees (61%) and non-permanent employees (39%).
Non-permanent employees are hired for support functions.
Employees Composition (Total Headcount 8,137 Full Year 2005)
Non-permanent
39%
Permanent61%
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
31/12/04 31/12/05
IndosatLintasartaIM2Sisindosat
Full Year 2005 Results Page 15
Organization Structure
Deputy President Director
Kaizad B. Heerjee
Deputy President Director
Kaizad B. Heerjee
Network Ops & Quality
MgmtDirector
Raymond Tan
Network Ops & Quality
MgmtDirector
Raymond Tan
Information Technology
Director
Joseph Chan
Information Technology
Director
Joseph Chan
Planning & Project Dev
Director
Wityasmoro S. H.
Planning & Project Dev
Director
Wityasmoro S. H.
Finance Director
Wong Heang Tuck
Finance Director
Wong Heang Tuck
Corporate ServicesDirector
S. Wimbo S. Hardjito
Corporate ServicesDirector
S. Wimbo S. Hardjito
Corporate Market
Director
Wahyu Wijayadi
Corporate Market
Director
Wahyu Wijayadi
Consumer Market
Director
Johnny S. Sjam
Consumer Market
Director
Johnny S. Sjam
President Director
Hasnul Suhaimi
President Director
Hasnul Suhaimi
Regional Jawa Timur &
Kalimantan
Regional Jawa Timur &
Kalimantan
Regional Sulawesi, Maluku &
Papua
Regional Sulawesi, Maluku &
Papua
Regional Jawa Barat
&JawaTengah
Regional Jawa Barat
&JawaTengah
Regional Sumatera
Regional Sumatera
RegionalJabotabek &
Banten
RegionalJabotabek &
BantenSenior Vice PresidentsSenior Vice Presidents
Full Year 2005 Results Page 16
Recent Development
§ The regulators requires operator to conduct mandatory prepaid registration to be completed in April 2006
§ Customers can register by SMS, website, phone and walk-in centers
§ As of 16 February 2006, 4.3 million prepaid subscribers have been registered
§ Supporting 3G trial, Indosat has installed 10 BTSs in Jakarta and Surabaya.
§ Indosat had initiated the plan to migrate its fixed wireless network from the 1900 MHz band in Jakarta.
§ The 3G tender have been finalized and Indosat won 5 MHz
Mandatory Prepaid
Registration
Preparation for 3G Services
§ Transparent charging formula provided by regulator based on cost allocation.
§ All operators should open direct interconnection.
§ The minister Decree has been signed and should be implemented in 2H06.
New Interconnection
Scheme
Full Year 2005 Results Page 17
Thank You