Profit and Loss Comparison
10. Net Income per Share
Net income per share decreased by Rp41.52 or 18.6%, from Rp223.55 in 2017 to Rp182.03 in 2018.
Comparison of Profit and Loss for The Year Ended December 31, 2017 Compared to Year Ended December 31, 2016 1. Revenues
Telkom recorded an increase in revenues by Rp11,923 billion or 10.2%, from Rp116,333 billion in 2016 to Rp128,256 billion in 2017. This increase is mainly due to the data, internet and informa on technology services revenue.
a. Cellular Telephone Revenues
Telkom cellular revenues accounted for 29.0% of the 2017 consolidated revenues. The cellular revenues decrease by Rp1,251 billion, or 3.2%, from Rp38,497 billion in 2016 to Rp37,246 billion. The decrease is due to a decrease in usage charges revenue by Rp1,062 billion or 2.8%.
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b. Fixed Lines Revenues
Fixed line revenues decreased by Rp877 billion or 11.6%, from Rp7,542 billion in 2016 to Rp6,665 billion in 2017.
The decrease in fixed line revenues occurred due to a decrease in usage charges by Rp815 billion or 21.2%.
c. Data, Internet and Informa on Technology Services Revenues
Telkom derived data, internet and informa on technology services revenues of Rp68,535 billion, increase by Rp9,564 billion or 16.2% from Rp58,971 billion in 2016. Revenue from this business ac vity accounted for 53.4%
of consolidated revenue in the year ended December 31, 2017. Increase in data revenues, internet and informa on technology services is mainly due to:
• An increase in cellular, internet and data by Rp9,653 billion or 34.1% due to the growth in mobile broadband usage from 84.7 million subscribers in 2016 to 105.8 million subscribers in 2017.
• An increase in internet, data communica ons and informa on technology services revenue increased by Rp2,012 billion or 15.4% in line with growing fixed broadband subscribers from 4.3 million to 5.3 million, which include IndiHome subscribers.
• Increased Pay TV revenue by Rp398 billion or 25.7% as IndiHome subscribers.
• Increase in other revenue by Rp289 billion or 451.6%.
• This increase was compensated by a decrease in SMS revenues of Rp2,788 billion or 17.4% due to over the top (OTT) services.
d. Interconnec on Revenue
The interconnec on revenues consist of interconnec on revenues from Telkom's fixed line and interconnec on revenues from Telkomsel's cellular network. Interconnec on revenues include interna onal direct incoming calls from IDD 007 services. Interconnec on revenues in 2017 increased by Rp1,024 billion or 24.7% from Rp4,151 billion in 2016 to Rp5,175 billion in 2017, due to increased in domes c interconnec on revenue.
e. Network Revenues
The network revenues increased by Rp429 Billion or 29.7%, from Rp1,444 billion in 2016 to Rp1,873 in 2017.
f. Other Telecommunica on Services Revenues
Other telecommunica on services increased by Rp3,034 billion or 53.0%, from Rp5,728 billion in 2016 to Rp8,762 billion in 2017. The increased was mainly due to:
• Increase in other revenue by Rp1,397 billion or 77.8%.
• Increase in sales of peripheral by Rp802 billion or 53.8%.
• Increase in CPE and terminal revenue by Rp344 billion or 179.2%.
• Increase in call center service revenue by Rp292 billion or 43.1%.
g. Other Income
Other income increased by Rp289 billion or 38.5%, from Rp750 billion in 2016 to Rp1,039 miliar in 2017.
2. Expense
Total expenses increased by Rp7,474 billion, or 9.6%, increased from Rp77,888 billion in 2016 to Rp85,362 billion in 2017.
a. Opera ons, Maintenance Telecommunica on Service Expense
Opera ons, maintenance and telecommunica on service expenses contributed 42.9% from the total of Company’s expenses. Opera ons, maintenance and telecommunica on service expenses increased by Rp5,340 billion, or 17.1%, from Rp31,263 billion in 2016 to Rp36,603 billion in 2017. This increase was primarily a ributable to the following:
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• An increase in opera ons and maintenance expenses by Rp3,967 billion, or 21.3%, due to an increase of network maintenance.
• An increase in radio frequency usage charges expense by Rp589 billion or 16.0% due to addi onal radio frequency by Telkomsel.
• An increase in cost of SIM card and vouchers by Rp290 billion or 46.5%.
• An increase in others expense by Rp171 billion or 106.2%.
• An increase in tower leases expense by Rp150 billion or 46.6%.
b. Deprecia on and Amor za on Expense
Deprecia on and amor za on expenses increased by Rp1,914 billion, or 10.3%, from Rp18,532 billion in 2016 to Rp20,446 billion in 2017 due to Telkomsel’s accelera on of transmission deprecia on.
c. Personnel Expense
Personnel expenses contributed 15.8% from the total expenses. This expense increases by Rp83 billion or 0.6%, from Rp13,612 billion in 2016 to Rp13,529 billion in 2017. This increase was driven by:
• A decrease in vaca on pay, incen ves and other benefits expenses by Rp526 billion, or 13.6%;
• A decrease in early re rement program by Rp628 billion due to no programs in 2017.
The decrease was offset by:
• An increase in pension benefit cost by Rp632 billion, or 59.2% in line with increase in pensions obliga on.
• An increase in salaries and related benefits expenses by Rp345 billion, or 4.6%.
• An increase in net periodic post-employment health care benefit cost by Rp113 billion, or 69.3%.
d. Interconnec on Expense
Interconnec on expense decreased by Rp231 billion, or 7.2%, from Rp3,218 billion in 2016 to Rp2,987 billion in 2017 in line with decrease in usage charges revenues.
e. Marke ng Expense
Marke ng expenses increased by Rp1,136 billion, or 27.5%, from Rp4,132 billion in 2016 to Rp5,268 billion in 2017. This increase was primarily due to an increased promo on by Telkomsel.
f. General and Administra on Expense
General and administra ve expenses increased by Rp650 billion, or 14.1%, from Rp4,610 billion in 2016 to Rp5,260 billion in 2017. This increase primarily due to:
• An increase in provision for impairment of receivables by Rp751 billion, or 101.1% due to more prudent es ma on methods undertaken by management.
• An increase in training, educa on and recruitment expenses by Rp132 billion, or 33.1%;
This increase was offset by a decrease in general expenses by Rp177 billion or 10.9%.
g. Gain on Foreign Exchange-net
Gain on foreign exchange – net amounted to Rp51 billion, while in 2016 loss on foreign exchange net by Rp52 billion.
h. Other Expense
Other expenses decreased by Rp1,149 billion or 46.5%, from Rp2,469 billion in 2016 to Rp1,320 billion in 2017.
3. Opera ng Profit and Opera ng Profit Margin
As a result of the foregoing, opera ng profit increased by Rp4,738 billion, or 12.1%, from Rp39,195 billion in 2016 to Rp43,933 billion in 2017. Opera ng profit margin increased from 33.7% in 2016 to 34.3% in 2017.
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4. Profit Before Income Tax and Pre-Tax Margin
The profit before income tax increased by Rp4,470 billion, or 11.7%, from Rp38,189 billion in 2016 to Rp42,659 billion in 2017. Pre-tax margin increased from 32.8% in 2016 to 33.3% in 2017.
5. Income Tax Expense
Income tax expense increased by Rp941 billion, or 10.4%, from Rp9,017 billion in 2016 to Rp9,958 billion in 2017, inline with the increase in profit before income tax.
6. Other Comprehensive Income
In 2017, other comprehensive income amounted to Rp2,332 billion due to an actuarial losses by Rp2,375 billion. In the previous year, Telkom’s other comprehensive income amounted to Rp2,099 billion.
7. Profit for The Year A ributable to Owners of The Parent Company
Profit for the year a ributable to owners of the parent Company increased by Rp2,793 billion, or 14.4%, from Rp19,352 billion in 2016 to Rp22,145 billion in 2017.
8. Profit for The Year A ributable to Non-Controlling Interest
Profit for the year a ributable to non-controlling interest increased by Rp736 billion, or 7.5%, from Rp9,820 billion in 2016 to Rp10,556 billion in 2017.