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Full Year 2005 Results

PT Indosat Tbk



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


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


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


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)


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


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%


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%


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%


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


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%


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


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%


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


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


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


Thank You

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