Revenues Total revenues increased by Rp6,729 billion, or 8.1, from

d. Interconnection Revenues Interconnection revenues comprised interconnection revenues from our fixed line network and interconnection revenues from Telkomsel’s mobile cellular network. Interconnection revenues included incoming international long-distance revenues from our IDD service TIC-007. Interconnection revenues increased by Rp570 billion, or 13.3, from Rp4,273 billion in 2012 to Rp4,843 billion in 2013. This increase was triggered by an increase in domestic interconnection revenues of Rp353 billion, or 13.5, and an increase of Rp218 billion, or 13.2, in international interconnection revenues, due to our promotion rate offers for international calls and the increased number of incoming calls to mobile subscribers. e. Network Revenues Network revenues increased by Rp45 billion, or 3.7, from Rp1,208 billion in 2012 to Rp1,253 billion in 2013 mainly due to a increase in our revenues from leased lines services by Rp37 billion, or 4.5, from Rp824 billion in 2012 to Rp861 billion in 2013. This increase was due to increasing number of our subscriber by 27,078, or 7.0. f. Other Telecommunications Services Revenues Revenues from other telecommunications services increased by Rp678 billion, or 25.6, from Rp2,645 billion in 2012 to Rp3,323 billion in 2013. The increase was primarily due to an increase of Rp260 billion, or 64.8, in lease revenue, an increase in revenues from USO compensation due to an increase in USO projects to establish internet service centers in various provincial capital cities in 2013 and an increase of Rp151 billion, or 14.4, in CPE and terminal revenue. The increase was partly offset by a decrease in revenues from pay TV of Rp131 billion, or 32.3due to our corporate action the sale of TelkomVision one of our subsidiaries in pay TV. g. Other Income Other income increased by Rp20 billion, from Rp2,559 billion in 2012 to Rp2,579 billion in 2013.

2. Expenses Total expenses increased by Rp3,695 billion, or 6.8,

from Rp54,005 billion in 2012 to Rp57,700 billion in 2013. The increase in expenses was attributable primarily due to increases in operations, maintenance and telecommunication services, depreciation and amortization also general and administrative expenses. These expenses are further explained below: a. Operations, Maintenance and Telecommunication Services Expenses Operations, maintenance and telecommunication services expenses increased by Rp2,529 billion, or 15.1, from Rp16,803 billion in 2012 to Rp19,332 billion in 2013. The increase in operations, maintenance and telecommunication services expenses was attributable by the following: - An increase in operations and maintenance of Rp1,655 billion, or 18.4, due to a decrease in expenses associated with increasing the capacity of receiver and transmission stations and Telkomsel’s broadband services. - Cost of IT services increased by Rp455 billion, or 205.0, from Rp222 billion in 2012 to Rp677 billion in 2013. This increase was primarily due to the increase in integration system expenses. - Electricity, gas and water expenses increased by Rp184 billion, or 20.9, from Rp879 billion in 2012 to Rp1,063 billion in 2013, due to an increase in electricity expenses due to increasing number of our BTS and network for Telkomsel’s broadband services and electricity tariff. The above increases were offset by insurance expenses decreased by Rp297 billion, or 44.3, from Rp671 billion in 2012 to Rp374 billion in 2013 due to no satellite insurance payment for Telkom-3. Our total operations, maintenance and telecommunication services expenses accounted for 33.5 of our consolidated expenses for the year ended December 31, 2013, compared to 31.1 for the year ended December 31, 2012. 127 2014 Annual Report PT Telkom Indonesia Tbk Persero b. Depreciation and Amortization Expenses Depreciation and amortization expenses increased by Rp1,324 billion, or 9.2, from Rp14,456 billion in 2012 to Rp15,780 billion in 2013 primarily due to increased in depreciation expense by Rp1,476 billion, or 10.8, from Rp13,635 billion in 2012 to Rp15,109 billion in 2013. The increase in depreciation expense primarily related to depreciation of transmission installation and equipment amounting to Rp1,065 billion, or 14.0, and an increase of loss in impairment of Rp349 billion, or 141.3, compare to prior year. c. Personnel Expenses Personnel expenses decreased by Rp53 billion, or 0.5, from Rp9,786 billion in 2012 to Rp9,733 billion in 2013 due to no early retirement programs were offered in 2013 that cause a decrease by Rp699 billion or 100.0 in early retirement program expenses. This decrease above was partially offset by an increase in salaries and related benefits by Rp296 billion or 9.1 from Rp3,257 billion in 2012 to Rp3,553 billion in 2013 and an increase in net periodic post-retirement health care benefit costs by Rp284 billion, or 315.6. d. Interconnection Expenses Interconnection expenses increased by Rp260 billion, or 5.6, from Rp4,667 billion in 2012 to Rp4,927 billion in 2013 primarily due to an increase of Rp256 billion, or 7.4, in domestic interconnection and transit interconnection expenses, in line with an increase of 13.5 in domestic interconnection and transit revenues. e. Marketing Expenses Marketing expenses decreased by Rp50 billion, or 1.6, from Rp3,094 billion in 2012 to Rp3,044 billion in 2013 primarily due to a decrease in advertising and promotion expenses by Rp93 billion, or 3.8, due to using selective media for promotion and increasing group synergy. f. General and Administrative Expenses General and administrative expenses increased by Rp1,119 billion, or 36.9, from Rp3,036 billion in 2012 to Rp4,155 billion in 2013 due in part to an increase in provision for impairment of receivables by Rp674 billion, or 73.7.0, from Rp915 billion in 2012 to Rp1,589 billion in 2013. This increase primarily resulted from current year individual and collective assessment for impairment of receivables. The increased also contribute by a 59.1 increased in training, education and recruitment by Rp153 billion and a 28.1 increased by Rp148 billion in general expenses. This increase above was partially offset by a 34.1 decreased in social contribution expenses by Rp44 billion, or 34.4. g. Gain loss on Foreign Exchange – net Loss on foreign exchange - net increased by Rp60 billion, from Rp189 billion in 2012 to Rp249 billion in 2013. The increase was primarily due to the appreciation of the US Dollar by 26.3. h. Other expenses Other expenses decreased by Rp1,493 billion, from Rp1,973 billion in 2012 to Rp480 billion in 2013. The decrease primarily related to derecognition in 2012 of the carrying value of the Telkom-3 Satellite, which was built and launched, but failed to reach usable orbit, amounting to Rp1,606 billion. 3. Operating Profit and Operating Profit Margin As a result of the foregoing, operating profit increased by Rp2,148 billion, or 8.4, from Rp25,698 billion in 2012 to Rp27,846 billion in 2013. Operating profit margin increased from 33.3 in 2012 to 33.6 in 2013. 4. Profit before Income Tax and Pre - Tax Margin As a result of the foregoing, profit before income tax increased by Rp2,921 billion, or 12.1, from Rp24,228 billion in 2012 to Rp27,149 billion in 2013. Pre - tax margin increased from 31.4 in 2012 to 36.7 in 2013. 128 2014 Annual Report PT Telkom Indonesia Tbk Persero FINANCIAL AND PERF ORMANCE HIGHLIGHT MANA GEMENT REPOR T PREF A GENERAL INF ORMA TION OF TELK OM INDONE SIA MANA GEMENT’S DISCUSSION AND ANAL Y SIS CORPORA TE GO VERNANCE SOCIAL AND ENVIRONMENT AL RE SPONSIBILITY APPENDICE S