PT XL PT XL AxiataAxiata, , TbkTbk. (XL). (XL)
Corporate PresentationCorporate Presentation
1Q 101Q 10
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1
9.1% 8.4% 8.4% 8.1% 7.9% 7.4%
2007 Jan-Apr'08 Jul-Oct'08 Jan-Apr'09 Aug'09 Feb '10
1. Latest official figures
Source : Bank Central, BPS, The Jakarta post, Antara, Kompas, DRI, Yahoo Finance
Unemployment Rate (%)Unemployment Rate (%)
Interest rates (%)Interest rates (%)
Inflation (Y-o-Y, %)Inflation (Y-o-Y, %)
ISX and FX RateISX and FX Rate
Domestic macroeconomic dashboard
7.00% 6.75% 6.50% 6.50% 6.50% 6.50% 6.50%
6.50% 6.50% 6.50% 6.50% 6.50%
13.4% 13.2%13.0% 12.9% 12.4% 11.9% 11.9% 11.9% 11.9% 11.9% 10.5% 10.5%
Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May
BI Rate Base Lending Rate
• Unemployment rate per February 2010 of 7.4%1 or 8.59 million
unemployment decrease from August 2009 level of 8.96million
• Decrease in unemployment rate reflected economic recovery
• Inflation driven by price increase of basic commodities
• Year to date June 2010 inflation is 2.42%. Government
expects the end of year inflation will still in target range of
4%-6%
• Volatile ISX due to global and regional un-easiness (slower
US recovery, European debt crisis, regional political tensions)
• IDR most recently strengthened as foreign capital returning
• Major banks started to lower lending rate
2
3
4
5
6
May
4.16%
Apr
3.91%
Mar
3.43%
Feb
3.81%
Jan
3.72%
Dec
2.78%
Nov
2.41%
Oct
2.57%
Sep
2.83%
Aug
2.75%
Jul
2.71%
June
5.05%
2,914
9,083
1,000
1,500
2,000
2,500
3,000
8,000
9,000
10,000
11,000
12,000
13,000
1 Jan 20101 Jul 20091 Jan 2009
ISX
FX
30 June
2
Positive outlook for Indonesia Telco market externalities
� Potential restructure of interconnection fee
� Potential decrease in voice interconnection fee
� Possible introduction of SMS interconnection fee
� Change in Licence Fee Charging method expected
� From # of Network elements to bandwidth
� XL will obtain second 3G carriers
� More transparent guidance on infrastructure sharing
Macro Economy
Industry/Competition Regulatory
� Higher GDP of 5.0-5.5% expected in 2010 with YoY inflation at 5%± 1%
� Global recovery, commodity prices, as well
as post-election government policies are
key to sustainable growth
� Further industry consolidation is expected
� Potentially creating benignant competition
� Intense but rational competition
� Emergence of Data service Mobile Data Ecosystem
Source: XL, Central Bank
3
1. UBS penetration x Population.
Source: Analyst reports
More stable Telco market expected
273255
228
190
147
99
2009 20122010 201120082007
Total number of SIMs in the market (Mn) 1
Potentially ~45Mn net adds in the next two yearsPotentially ~45Mn net adds in the next two years
+39%
+9%
There is still room for penetration growth
4
XL’s deliberate strategy has produced impressive results
2008: “Minute Factory” 2009: “Drive value”2010: “Optimize core and lead
in new growth space”
The XL
Strategy
BUILDING SCALE
�Affordable pricing strategy to drive
usage and create addiction
� Invested significantly to expand
network coverage and capacity
� Fast and lean organization to reduce
cost/MoU
STIMULATING USAGE
� Drive value from subscriber through
disciplined, fact-based approach
� Focus on quality subs (SWE)
�Strengthen brand, value beyond price
� Increase productivity
MONETIZING USAGE
� Maximize returns from core business
� Invest and innovate in future growth
engines
�Deliver intentional customer
experience
�Prudent capital expenditures
Subscriber
(mn)
32.631.426.0
2008 2009 1Q 2010
Gross
Revenue
(IDR Tn)
4.2
13.912.2
1Q 20102008 2009
EBITDA
margin (%)
514542
1Q 20102008 2009
RoIC (%)
11.29.73.4
1Q 20102008 2009
21%
14%
+3% +6%
+6.3%+1.5%
5
Our cost and CapEx are under control
Source: Internal analysis
EBITDA margin improved…EBITDA margin improved…
EBITDA
margin (%)
… and CapEx generated higher yield… and CapEx generated higher yield
0.35
0.41
2008 2009
0.15
2009
0.26
2008
Incr. Revenues/
Rp CapEx
Incr. Revenues/
Rp CapExIncr. EBITDA/
Rp CapEx
Incr. EBITDA/
Rp CapEx
51
454242
0
10
20
30
40
50
60
1Q 2010200920082007
6
Data is a potential growth driverEarly indicators on usage shift from traditional services to Data
Strong growth in Data subs...Strong growth in Data subs...
63
+349%
Q1 2010
284
Q1 2009
XL data revenue
(IDR Bn)
Source: Internal report
+387%
Q1 2010
12
Q1 2009
3
Subs with GPRS (Mn)
30
+1,057%
Q1 2010
343
Q1 2009
...Usage......Usage... ...And Revenues...And Revenues
Data traffic excluding
Blackberry (TB)
100%
1H 2010
61%
24%
15%
2009
64%
24%
11%
2008
69%
24%
7%
2007
61%
32%
6%
Voice
SMS
VAS and GPRS
Shifting revenue proportionShifting revenue proportion
Usage revenue composition (%)
7
XL aspires to become leading in mobile data service
XL AspirationsXL Aspirations
To have the best business model
that generates values to
shareholders (positive ROIC)…
…With the scale that allows us to
have sustainable scale advantage
over competitors
Malaysia
31%
92%
Thailand
9%
97%
Indonesia
5%
60%
Indonesia is a handset marketIndonesia is a handset market
Note: Penetration estimate for 2009
Source: Euromonitor, GSMA Asia Pacific Mobile Observatory
Handset penetration PC penetration
PC vs. Handset penetration (%)
Investment in Data services is to focus on mobile data (handset-based),
while maintain selective investment on Broadband
8
Emergence of Data introduces a set of new complexities
Strong end-to-end content management required
Active role in managing devices is crucial
Different skill sets and competencies to manage
Mobile Data Ecosystem
Buying process
Content
Device
People and
infrastructure
Complex Data Infrastructure
• Right mix of 2G/3G/ critical
People
Network
infrastructure
More complex buying process
9
Summary
• Positive Telco market outlook
• Solid macro-economic growth
• Expected further consolidation in industry
• Positive and more transparent regulatory changes expected
• Intense, yet rational competition
• XL is continuing on its next stage of Strategy
• Focus on delivering returns from Core business
• Cost and CapEx in control
• XL aspires to lead in Data service (as potential growth driver) as usage
shift towards Data service
10
Balanced growth and strong balance sheet
Asset
Productivity
Operating
Profitability2
Top-Line
Growth1
3
Revenue
EBITDA
EBIT
1Q10 vs. 1Q09
42%
92%
419%
Net Debt/Equity
Net Debt/EBITDA
4.6 x 1.2 x
3.7 x 1.6 x
1Q09 1Q10
RoIC
Normalized ROA
Normalized ROE
11.2%
6.4%
27.2%
5.4%
1.2%
6.6%
11
XL’s 2010 revised guidance
2010 Old Guidance2010 Old Guidance 2010 Revised Guidance2010 Revised Guidance
Cash out CAPEX
At least 15% growth
Mid 40’s
USD 400 – 450 Mn
from internal
cash flow
At least higher teens
At least higher 40’s
Approximately IDR 4.5-5 Tn,
of which about 25% for data
service, internally funded
EBITDA Margin
Revenue growth