JAKARTA, AUGUST 6th, 2024. PT XL Axiata Tbk (XL Axiata or the Company) has successfully continued its positive performance by achieving solid growth and profitability throughout the first half of 2024. The Company achieved total revenue of IDR 17.06 trillion, growing by high single digit of 8% compared to the same period last year (YoY). EBITDA reached IDR 8.96 trillion, increasing by 17% YoY, with an EBITDA Margin of 52.5%, and net profit after tax (PAT) amounted to IDR 1.03 trillion, showing a significant increase of 58% YoY. Data and digital service revenue increased by 93% YoY and contributed xx% to total revenue.
Dian Siswarini, President Director & CEO of XL Axiata, stated, “Despite the more challenging situation within the national telecommunications industry and ongoing intense competition, we have achieved excellent results. In the first half of this year, XL Axiata has been able to maintain positive growth and profitability momentum compared to the same period last year, successfully recording a net profit of IDR 1.03 trillion. This figure represents the highest achievement in the past 10 years.”
Dian added that one key to XL Axiata's growth is the personalization of offers and services. As a result, the net promoter score (NPS) for data has increased significantly, driving service usage and ultimately helping to boost revenue. This strategy will continue to be implemented throughout 2024.
The implementation of a digital-based strategy through data analytics has also enabled XL Axiata to invest in high-value areas and build networks, including meeting demand from all customer segments. Data analytics also allows XL Axiata to evaluate key performance indicators (KPIs) across all aspects related to customers, marketing campaigns, and customer loyalty, enabling the company to design the right strategies to address challenges and opportunities at the right time.
XL Axiata is also enhancing the application of artificial intelligence (AI) technology to open new opportunities in the highly dynamic telecommunications industry landscape. This includes improving customer experience, personalizing services and developing product recommendations tailored to customer needs, optimizing BTS site location accuracy, and increasing operational efficiency by optimizing processes and reducing manual processes.
Increase in Operational Excellence
The positive performance in the first half of 2024 is also attributed to the company's success in optimizing operational costs (OPEX), ultimately reducing operational expenses. XL Axiata's total operational costs decreased compared to the same period last year. The largest reductions were seen in sales and marketing expenses, infrastructure costs, and supplies and overhead costs.
"One of the largest and continuously increasing operational expenses is regulatory cost. We hope to obtain incentives from the government to help create a healthier telecommunications industry, enabling us to expand network development and provide better service quality to customers," said Dian.
The reduction in sales and marketing expenses was partly driven by the increased use of digital tools such as the MyXL and AXISnet applications. XL Axiata's digital transformation strategy, including enhancing the customer experience through these applications, continues to show effectiveness. By the end of June 2024, the number of active users of these applications reached 32.1 million, an increase of 5.1 million YoY. The Monthly Active User (MAU) growth has reached 110% since December 2021.
In term of infrastructure, XL Axiata continued to expand its network through the end of the first half of 2024. The total number of BTS units reached 163,884, including 109,170 4G BTS units, representing an 8% YoY increase. The fiber optic network connection (fiberization) reached 62%. This fiberization was undertaken to improve data network quality and prepare for future 5G implementation.
To enhance network quality as a crucial support for improving customer experience, XL Axiata allocated capital expenditure (Capex) of IDR 8 trillion this year. The company also continues to strategically invest in network development to boost service quality and accommodate growing network usage.
These investments and ongoing network strategies have successfully enhanced network experience quality, supporting higher service usage. This is evident from the traffic growth of 13% YoY.
Regarding convergence services, the company is continuing its Structural Transformation process, which includes plans of business transfer of around 750 thousand Link Net customers to XL Axiata as ServeCo. This step aims to increase cross-selling opportunities, thus expanding and accelerating Fixed Mobile Convergence (FMC) services. Additionally, XL Axiata is enhancing synergy with Link Net as FibreCo to respond more efficiently and quickly to the fixed broadband market needs.
Convergence services: During the 1H 2024 period, the convergence network reached xxx cities/regencies, with a convergence penetration rate of 81% and a total customer base of 267 thousand, indicating growing demand for XL Satu's FMC products.
XL Axiata's financial position was healthy as of the end of June 2024, with gross debt at IDR 10.8 trillion and a net debt to EBITDA gearing ratio (including finance lease) of 2.46x. Net debt stood at IDR 9.4 trillion. XL Axiata has no USD-denominated debt, with 47% of current loans having floating interest rates and 53% fixed rates. Free Cash Flow (FCF) was at a healthy level, increasing by 7% to IDR 4.8 trillion.