XL will raise US$600 million

PT Excelcomindo Pratama, the Indonesian mobile-phone operator controlled by Malaysia's
Axiata Group Bhd, may raise funds by selling bonds or shares in a rights offer.
President Director Excelcomindo Hasnul Suhaimi said the company need capital around US$300 juta-US$600 million.
XL recorded a positive revenue growth of 10% YoY compared to 1Q08. The revenue growth was mainly driven by voice revenue, as a result of a 263% upsurge in total outgoing minutes. This growth was strengthened by the 682% increase in tower business revenue.
EBITDA decreased 2% YoY to Rp 1,113 billion for the first quarter ended 31 March 2009 while EBITDA margin slightly decreased to 38% as a result of leasing new sites and towers rather than investing.
XL incurred a net loss of Rp 306 billion due to the depreciation of Rupiah against USD and higher interest bearing debt level that led to forex loss of around Rp 643 billion (realized and unrealized) and interest expense of Rp 383 billion. Excluding the unrealized forex impact, XL recorded a normalized net income of Rp 14 billion.
XL’s total subscribers increased 39% YoY from 18.4 million in 1Q08 to 24.9 million in 1Q09. This number was slightly lower than the last quarter of 26 million. However, XL’s prepaid revenue generating subscriber base (prepaid RGB) increased by 34% YoY from 15.9 million in 1Q08 to 21.3 million in 1Q09 and increased 2% QoQ from 20.9 million in 4Q08. Prepaid RGB is the number of unique subscribers during a month creating one or more revenue generating events. XL focused on improving RGB rather than total subscribers which includes active and grace subscribers.
“We’d like to seriously address the so-called ’calling card phenomenon’ in order to improve the quality of our subscriber base. We have begun efforts to systematically reduce acquisitions of subscribers who exhibit the ‘calling card’ behavior or those who activate a SIM card, use up its pre-loaded value and throw it away, and sustain further use of the service by activating a new SIM card again. We believe that this segment is not profitable to be acquired and served. To begin with, we took an initiative to optimize supply and better match demand of starter packs (SP) in the market and improve the visibility and control of SP levels in the distribution network. By doing this, we will decrease our churn rate and reduce our subscriber acquisition cost”, said Hasnul.
He also added that XL expects to continue pursuing this strategy as XL believes this will result in a better churn rate level, improvement in longevity and eventually enhance its prepaid revenue/SIM card. At the same time, XL will continue to improve the quality of its subscriber acquisition and retention by continuously enhancing the attractiveness of its plans and services.