Jakarta, February 12th 2024. PT XL Axiata Tbk (XL Axiata) managed to secure an excellent performance throughout 2023. Revenue increased by 11% year-on-year (YoY) to IDR 32.34 trillion, accompanied by a stronger growth in EBITDA by 12% YoY to IDR 15.89 trillion driven by cost excellence. EBITDA margin expanded to 49.1% with net profit booked at IDR 1.28 trillion, showing an increase of 15% YoY. This overall achievement was attributed to the robust data traffic which rose 21% YoY to 9,638 Petabytes, driving the 91% contribution of Data and Digital services to Total Revenues, along with the sustained quality subscriber base of 57.5 million.
President Director & CEO of XL Axiata, Dian Siswarini, mentioned, "We succeeded in navigating through 2023 with resilience and achieved very encouraging performance, as shown through by our double digit growth in revenue, EBITDA and net profit. The improvement of our digital channels, strong network, as well as the adoption of relevant technology in all business lines, have been able to support our high level of service quality and encourage the increase data traffic, which contributed to the increase in ARPU to IDR 43 thousand."
Dian added that the successful performance throughout 2023 was largely attributed to the company's efforts to improve efficiency in all areas of the business. At the end of 2023, XL Axiata saw efficiency in sales and marketing costs, which was reduced by 6% YoY. Overall, the increase in OPEX can be managed to be lower than revenue growth.
The achievement of lower sales and marketing was also largely driven by the increasing engagement to customers through XL Axiata’s digital channels, MyXL and AXISnet applications. By the end of 2023, these apps had a total of 29 million active users per month, which has almost doubled in the last two years.
The growing utilization of MyXL and AXISnet plays a pivotal role in enhancing the overall customer experience, fostering a deeper understanding of customer needs, preferences, and behaviors. This in turn enables XL Axiata to deliver personalized solutions and offerings that align with customer needs more effectively.
One of the keys to XL Axiata's growth is personalization of offers and services. As a result, net promoter score (NPS) data continues to increase significantly, encouraging service use and ultimately helping to increase revenue. This strategy will continue to be implemented throughout 2024.
The results of implementing digital-based strategies through data analytics also helps XL Axiata to pinpoint the right investments to strengthen network in high-value areas to meet demand from all customer segments. The data analytics also allows XL Axiata to evaluate key performance indicators (KPI) in all aspects related to customers, marketing campaigns and loyalty. This helps the company design the effective strategy to tackle challenges and opportunities at the right moment.
On network infrastructure, by the end of 2023, XL Axiata increased the number of base transceiver stations (BTS) by 14,101, bringing the total to 160,124 or up 10% YoY. Among them, 104,993 are 4G BTS. Meanwhile, fiberization has reached 61% of the total BTS across Indonesia. Fiberization is important to modernize the network by connecting BTS via fiber lines, which includes the regeneration of BTS devices. Fiberization has been proven to improve the quality of 4G data services and is also one of the steps in preparing for the 5G network.
XL Axiata is continuously enhancing network quality, as the main support to improve customer experience. XL Axiata's commitment to strengthening its network is reflected in the allocation of capital expenditure (Capex) in 2023 of IDR 7.16 trillion. XL Axiata aims to continue smart investments and innovative initiatives to continue the uplift in service quality and support the growing network usage.
As of December 2023, XL Axiata managed to secure a strong financial position. Gross debt was recorded at IDR 10.11 trillion, and net debt at IDR 9.14 trillion. Net Debt to EBITDA gearing ratio (including finance lease) was 2.84x. XL Axiata maintains zero debt in foreign currency, eliminating the risk of exchange rate fluctuations. Moreover, 57% of the existing loans are at fixed interest rates, while the remaining 43% are subject to floating interest rates. Free cash flow (FCF) experienced a significant surge of 69% to reach IDR 8.72 trillion, signifying a robust and favorable financial condition.
FMC Service Acceleration
2023 has been a landmark year for XL Axiata’s convergence ambitions as evident by the doubled number of fixed broadband subscribers and Convergence Penetration. Fixed broadband or Home service subscribers have reached 235 thousand, with a stellar convergence penetration rate of 75%. This achievement shows the strong demand for the XL Satu FMC product, which also sets a positive trajectory for further take up in Convergence going forward. Currently, XL Axiata also has XL Home and XL SATU fiber coverage in 86 cities/regencies, with a total of 2 million homes passed.
XL Axiata - Link Net collaboration continues to increase in efforts to accelerate FMC services. In the next five years, both parties will expand service coverage to 8 million homes passed. In June and December 2023, XL Axiata and Link Net have signed two cooperation agreements to further develop and operate a network of 3 million homes passed. With the addition of this infrastructure, XL Axiata will be poised to accelerate the penetration of XL SATU converged service. The progress of delayering XL Axiata as a ServeCo and Link Net as a FiberCo has also moved forward with the agreement for the acquisition of around 750 thousand Link Net residential customers to XL Axiata. This transfer of Link Net customers will increase the number of XL Axiata Fixed Broadband service customers to around one million customers, while placing XL Axiata as the second largest fixed broadband service player in Indonesia.
XL Axiata is also continuing to target its services for the corporate and small and medium enterprise (SME) segments. This is in line with the continued increase in demand for Information and Communication Technology (ICT), Internet of Things (IoT) and Big Data services.
During 2023, XL Axiata has garnered recognition both domestically and internationally, namely the Indonesia Technology Excellence Award for ICT Telecommunication - International Asian Technology Excellence Awards, Top 50 Big Capitalization Public Listed Company & Best Role of Stakeholders - 4th IICD Corporate Governance Award 2023, Best Award in the External Relations Category with Smart Mining innovation: Digitalization for Greener Future - IDX Channel Anugerah Innovation Indonesia (ICAII) 2023, Best Companies to Work for in Asia – Indonesia Chapter, and Digital Transformation from the HR Asia Best Companies event to Work for in Asia Awards 2023, Broadband Telecom Company of the Year - Indonesia and Marketing & Brand Initiative of the Year – Indonesia for XL Home from the Asian Telecom Awards 2023, Main Index, High Growth and High Market Capitalization Awards – TEMPO Index- IDNFinancials 52.