PT Link Net Tbk Signing Ceremony 5 September 2017 - event vFINAL FINAL FINAL
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Indonesia macro: a massive opportunity Rising population growth Rapid GDP/capita growth(a) Population (m) GDP per capita (US$) ~53% of population under 30 years of age Millennials with “internet lifestyle” 3,598 5,312 GDP (US$bn) 276 1,466 259 932 2016 2021 2016 2021 Increasing disposable incomes(b) Increasing urbanization(c) Annual household As % of GDP disposable incomes (US$) Urban 54% 66% 4,973 +12% 3,770 Rural 46% 34% 2016 2021 2016 2030 Source: 2017 Media Partners Asia unless otherwise stated a) Source: IMF Data (GDP refers to nominal GDP) 1 b) Source: OECD Data c) Source: World Bank and IMF
Indonesia fixed broadband and Pay TV are significantly underpenetrated Fixed broadband penetration rate of key comparable countries Subscriber (000) 4,372 5,674 3,359 4,580 6,840 7,108 8,969 10,877 3,790 3,959 317,280 407,122 948 955 94.8% 88.5% 2016 penetration 2020 penetration 74.2% 52.3% 45.0% 33.4% 34.4% 38.8% 28.3% 32.3% 14.4% 17.1% 9.1% 10.6% Indonesia Philippines Thailand Vietnam Malaysia China Singapore Pay TV penetration rate of key comparable countries Subscriber (000) 5,750 9,270 2,396 3,999 6,540 7,628 8,562 12,353 2,510 2,952 244,955 355,881 1,062 1,161 85.8% 79.2% 77.9% 2016 penetration 2020 penetration 69.0% 52.4% 52.6% 44.9% 40.3% 30.7% 31.1% 22.5% 17.6% 11.2% 13.4% Indonesia Philippines Thailand Vietnam Malaysia China Singapore Source: 2016 Media Partners Asia 2
Link Net at a glance Targets large and A leading fast growing affluent HSBB(a) provider segment(c). Large in Indonesia(b) subscriber base (~1.1m with ~1.9m RGUs) with low and Homes passed stable churn Strong enterprise Innovation led portfolio offering premium product with certain offering supporting governmental and premium ARPUs financial institutions with 97% including IDX bundling rate as customers Track record of Note: Company data as of 30 June 2017 unless otherwise stated a) HSBB refers to High Speed Broadband which is a fixed network capable of providing internet speeds of at least 4Mbps strong growth – 18% Fully-owned(f), b) Source: 2017 Media Partners Asia. Link Net is a leading HSBB provider in Indonesia in terms of subscriber market share as of 30 revenue CAGR(d) technology neutral June 2017 according to Media Partners Asia c) 7.3m addressable homes – According to, and based on addressable market of Upper 1, Upper 2 and Middle 1 SEC households, as with 59% EBITDA(e) network defined by, Nielsen (2Q17 definition of SEC classification) – For Greater Jakarta, Greater Surabaya (Includes Malang) and Medan. Nielsen reports based on number of people aged 10 and above. Addressable homes or households is derived by assuming each margin along with abundant home or household has 4 people each with resilient capacity d) Revenue CAGR over FY2014 to FY2016 e) Refers to 2016. EBITDA is a non-GAAP financial measure of the Company’s performance and should not be considered as an balance sheet alternative to performance measures derived in accordance with IFAS. See slide 38 for more information, including a reconciliation to profit for the period. EBITDA margin is defined as EBITDA divided by revenue f) Limited exceptions for certain last mile owned by property developers 3
…and operates in most attractive metropolitan areas Total addressable HH’s: 7.3m(a) Medan Total LN homes passed: 1.9m • Addressable households(a): 380k Total cable length: 24,890km • Homes passed: ~4k(b) • Estimated coverage ratio(c): ~1% Batam • Roll outs started in June 2017 1 5% Bandung • • Addressable households(a): 580k Homes passed: ~97k 1 18% • Estimated coverage ratio(c): ~17% Greater Surabaya & Malang 1 77% • Addressable households(a): 1,204k Homes passed: ~351k Greater Jakarta • • Estimated coverage ratio(c): ~29% • Addressable households(a): 5,157k • Homes passed: ~1.457m • Estimated coverage ratio(c): ~28% Bali • Focus on hotels Note: Company data as of 30 June 2017 unless otherwise stated 1 City homes passed / Total homes passed a) According to, and based on addressable market of Upper 1, Upper 2 and Middle 1 SEC households as defined by, Nielsen (2Q17 definition of SEC classification) – For Greater Jakarta, Greater Surabaya (Includes Malang) and Medan. Nielsen reports based on number of people aged 10 and above. Addressable homes or households is derived by assuming each home or household has 4 people each b) Includes homes passed for Batam, where roll outs started in June 2017 4 c) Coverage ratio calculated as homes passed divided by the total addressable households (based on Nielsen data)
Link Net has achieved roll-out success … Link Net is able to gradually ramp up new roll-outs over the past 5 years, supported by continuing growth in existing markets, expansion into in new regions and new avenues such as partnering housing developers to accelerate this deployment, and acquiring fiber infrastructure Leveraging existing & new channels to accelerate homes passed Homes passed and cable length Homes passed (000) Cable length (km) Leveraging 2,500 24,890 31,000 existing fiber 24,266 backbone 22,859 26,000 2,000 19,689 16,309 21,000 1,500 12,805 16,000 1,909 1,862 11,000 Acquiring 1,673 Regular 1,000 1,433 fiber 1,194 6,000 rollout 933 infrastructure Growing 500 1,000 2012 2013 2014 2015 2016 1H2017 homes passed Strong execution track record in rolling new homes passed Maximized investment returns by cherry picking the premium households Partnering who can afford Link Net services home Extensions developers Proven expansion strategy and technical know-how 5
Partnering home developers to accelerate homes passed Indonet Cowell Development Intiland Jakarta Garden City Residence One, Serpong Summarecon Apartments Bumi Serpong Damai (BSD) Mangkuluhur City Apartment Citraland, Surabaya 6
…and enlarge its subscriber base whilst maintaining its premium ARPU Link Net achieved strong RGU additions with further penetrations while retaining premium ARPU Added new RGUs while keeping churn at 2.3% Maintaining premium ARPU ('000) (IDR '000) 2.3% 2.3% 2.2% 2.2% 419 1,075 2.0% 415 1,024 407 528 1.5% 890 402 503 755 1.0% 433 363 547 0.5% 521 457 392 – 2014 2015 2016 1H 2017 2014 2015 2016 1H 2017 Broadband Cable TV Churn 7
Highly attractive financial profile… Revenue (IDR billions) 1,651 1,393 842 719 1H16 1H17 2Q16 2Q17 8
… with potential leverage capacity EBITDA Net Profit (IDR in billions) (IDR in billions) EBITDA margin (%) Net Profit margin (%) 59.8% 59.1% 28.5% 29.7% 976 490 834 397 1H 2016 1H 2017 1H 2016 1H 2017 Capex (IDR bn)(1) Net Cash with potential leverage capacity(2) (IDR in billions) 154 452 408 531 377 1H 2016 1H 2017 Total Cash Total Debt Net Cash Source: Company information (1) Capex represents additions to property and equipment 9 (2) Total cash and debt position as of June 30, 2017. Total debt mainly comprises vendor financing
Fully-owned(a) advanced and technologically resilient HSBB network Future proof network with abundant bandwidth capacity and high level of network redundancy Headend Distribution hubs Node Subscriber premises >24,800 km of cable across Indonesia Technologically agnostic approach to future rollout: - HFC network in the existing brownfield areas and FTTH network to be Has access to a total of 780 Gbps of International rolled out in new areas within the brownfield for enhancement bandwidth capacity - FTTH network to be rolled-out in greenfield areas with market skewed to the fiber-centric infrastructure Owns and has the capability to operate up to 8 Tbps fiber lines to Singapore gateway Offering a high quality HFC and FTTH network offering speeds Fully owned fiber backbone and last mile(a) upgradable to 10Gbps a) Limited exceptions for certain last mile owned by property developers b) Refers to greenfield network rollouts only c) Gigabit Passive Optical Network 10
Fully-owned(b) advanced and technologically resilient HSBB network (cont’d) Link Net has already completed most of its end-to-end network infrastructure, assuring network quality and reducing future investment requirement International Gateway Inter-city Connection Intra-city Connection Last Mile Roll-out Vertically Integrated End-to-end Network Infrastructure 2 proprietary international Acquired pan-Java fibre lines / submarine backbone in 2017 24,890 km(a) of cable network cables providing bandwidth to Singapore Acquired Jakabare in 100% proprietary intra- Substantially self-owned 2013 and B2JS in 2015 city connection in all of last mile roll-out(b) the operating cities Selective usage of Third Party Network for Quality a) Total cable length includes HFC and FTTH b) Limited exceptions for certain last mile owned by property developers 11
First Media accelerating expansion momentum
Regional expansion through intercity hub acquisition in Java Ultimate Capacity & Network Design The Network will employ DWDM technology with a maximum capacity 8000Gbps. It will be design with 1+1+R redundancy configuration using the five protection rings to achieve high network availability. The DWDM system can upgraded easily to meet future demand Coverage The Network will cover most of major cities in Java Island with 43 POP sites. A full 100G wavelength will be activated at every city commissioned to provide ample capacity to support future growth Time Delivery The DWDM system is being designed and implemented now and will be ready by Q1 2018 13
Regional expansion through intercity hub acquisition in Java The intercity fiber backbone will open doors to more than 43 cities that were previously untapped by Link Net Build and managed by Triasmitra Group, the telecommunication infrastructure deployer, including rolling out fiber optic and power cable network with a total over 7,000 km of submarine and inland FO cable system deployed. - Route using national way CITIES COVERED: - Total 5 Rings No City No City No City No City No City - Total distance of 2,615 km 1 Bandung 10 Ciranjang 19 Jombang 28 Purwakarta 37 Surabaya - Capacity: 4 cores (North), 4 cores (South) 2 Bekasi 11 Cirebon 20 Karawang 29 Purwodadi 38 Tegal 3 Bobotsari 12 Depok 21 Kebumen 30 Purwokerto 39 Tjepu To achieve 2.8 million homes passed 4 Bogor 13 Gandrungmangu 22 Lamongan 31 Salatiga 40 Ungaran cumulative in 5 years (existing and new cities) 5 Bojonegoro 14 Garut 23 Madiun 32 Semarang 41 Wates 6 Boyolali 15 Gendingan 24 Mojokerto 33 Solo 42 Weleri 7 Cepu 16 Gresik 25 Nganjuk 34 Subang 43 Yogyakarta 8 Ciamis 17 Indramayu 26 Patrol 35 Sukabumi 9 Cilacap 18 Jakarta 27 Pekalongan 36 Sumedang 14
PT Ketrosden Triasmitra 23 years 3 Core Businesses 15 Premier Customers of experience in telco Strong competence as telco industry Developer, Contractor, and Managed Service company 7,304 km More than 7,000 km of submarine and inland FO cable system deployed Certification The Certification Jartup License Construction ISO 9001 The Committee No. 325 - 2015 Service ISO 14001 Safety & Health Work Permit OHSAS 18001 Supervisory Grade 7 15
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