Data, Internet and Information Technology Services Revenues 3

138

PT Telkom Indonesia Persero Tbk Data, internet and information technology service revenues increased by Rp10,012 billion, or 26.5, from Rp37,808 billion in 2014 to Rp47,820 billion US3,470 million in 2015. This increase was primarily due to an increase in revenues from internet, data communication and information technology services by Rp2,445 billion, or 24.5, which was driven primarily by IndiHome subscribers, and data cellular and internet revenues from Rp6,102 billion, or 45.0 due to a growth in mobile broadband usage from 31.2 million subscribers in 2014 to 43.8 million subscribers in 2015 related to high adoption of smartphone 3G4G. SMS Revenues increased by Rp1,098 billion, or 7.8, from Rp14,034 billion in 2014 to Rp15,132 billion in 2015 driven from successful implementation of cluster- based pricing.

d. Interconnection Revenues Interconnection revenues comprised interconnection

revenues from our ixed line network and interconnection revenues from Telkomsel’s mobile cellular network. Including incoming international long- distance revenues from our IDD service TIC-007. Interconnection revenues decreased by Rp418 billion, or 8.9, from Rp4,708 billion in 2014 to Rp4,290 billion US311 million in 2015 primarily due to a decrease in domestic interconnection by Rp632 billion, or 21.7. This decrease ofset by increase of international interconnection revenues amounted to Rp214 billion, or 11.9.

e. Network Revenues

Network revenues decreased by Rp49 billion, or 3.8, from Rp1,280 billion in 2014 to Rp1,231 billion US89 million in 2015 primarily due to an decrease in our satellite transponder lease revenue by Rp158 billion, or 23.6, from Rp670 billion in 2014 to Rp512 billion in 2015, it was partly ofset primarily by increase in leased line amounted to Rp109 billion, or 17.9.

f. Other Telecommunications Services Revenues In 2015, revenues from other telecommunications

service increased by Rp836 billion, or 26.3, from Rp3,175 billion in 2014 to Rp4,011 billion US291 million in 2015. The increase was primarily due to an increase in sales of handset by Rp934 billion, or 160.5 and an increase in call centre revenues by Rp222 billion, or 49.8, it was partly ofset by decrease in CPE revenues by Rp230 billion, or 51.0.

g. Other Income

Other income increased by Rp426 billion, from Rp1,074 billion in 2014 to Rp1,500 billion US109 million in 2015.

2. Expenses

Total expenses increased by Rp9,988 billion, or 16.2, from Rp61,564 billion in 2014 to Rp71,552 billion US5,191 million in 2015. For futher explaination as shown below: 2014 restated 2015 Composition of Expenses 1 8, 5 3 4 2 5 .9 2 8,1 16 3 9 .3 11 ,8 7 4 16 .6 4,204 5 .8 3 ,5 8 6 5 .0 1, 917 2 .7 4 6 . 1 14 . 22 ,2 8 8 3 6 .2 1 7 , 13 1 2 7 .8 9 ,7 8 7 15 .9 3,963 6 . 4 4 ,8 9 3 7 .9 3 , 9 2 5 . 39 6. 1 . 6 Operations Maintenance Depreciation Amortization Interconnection Others Gain loss on Foreign Exchange Marketing Personnel General Administrative in billion rupiah in billion rupiah 3 ,2 7 5 4 .6 139 PT Telkom Indonesia Persero Tbk

a. Operations, Maintenance and Telecommunication Service Expenses

Operations, maintenance and telecommunication service expenses increased by Rp5,828 billion, or 26.1, from Rp22,288 billion in 2014 to Rp28,116 billion US2,040 million in 2015. The increase in operations, maintenance and telecommunication service expenses was primarily attributable to the following: − Operations and maintenance increase by Rp3,831 billion, or 32.4, due to an increase in expenses associated with network maintenance to improve our mobile cellular and IndiHome business performance; − Cost of handset sold increase by Rp1,072 billion, or 254.6, from Rp421 billion in 2014 to Rp1,493 billion in 2015. The increase was due to increase of modem and terminal bundling program; − Leased lines and CPE increased by Rp626 billion, or 82.6, which was used for operation and maintenance of leased lines. This increased were ofset by decreased in tower leased by Rp419 billion, or 39.3 and other expenses by Rp244 billion, or 94.6.

b. Depreciation and Amortization Expenses

Depreciation and amortization expenses increased by Rp1,403 billion, or 8.2, from Rp17,131 billion in 2014 to Rp18,534 billion US1,345 million in 2015, primarily due to an increase in property, plan and equiptment to improving our service to customers and accelerate ixed wireless business assets, ixed wireless assets has been fully depreciated amounted to Rp545 billion.

c. Personnel Expenses Personnel expenses increased by Rp2,087 billion,

or 21.3, from Rp9,787 billion in 2014 to Rp11,874 billion US861 million in 2015 due to a increased by Rp1,043 billion, or 32.8 in incentive and other beneit expenses, in line with company’s performance and a increase in early retirement program by Rp683 billion. This resulted in increase in employees income tax by Rp315 billion, or 23.9 from Rp1,317 in 2014 to Rp1,632 billion in 2015.

d. Interconnection Expense

Interconnection expense decreased by Rp1,307 billion, or 26.7, from Rp4,893 billion in 2014 to Rp3,586 billion US260 million in 2015 primarily due to an decrease of Rp1,288 billion, or 35.4 in domestic interconnection and transit, and international interconnection expense by Rp19 billion, or 1.5 in result of inter operator discount tarif.

e. Marketing Expense

Marketing expenses increased by Rp183 billion, or 5.9, from Rp3,092 billion in 2014 to Rp3,275 billion US238 million in 2015 due to an increase in advertising and promotion expenses by Rp142 billion, or 5.9, due to the selective use of media for promotion and increased group synergy in marketing our products, mainly promotion in 4G LTE and IndiHome Triple Play.

f. General and Administrative Expenses General and administrative expenses increased by

Rp241 billion, or 6.1, from Rp3,963 billion in 2014 to Rp4,204 billion US305 million in 2015 primarily due in part to an increase in provision for doubtful impairment of receivables by Rp226 billion, or 28.8.

g. Gain loss on Foreign Exchange - net Loss on foreign exchange - net increased by Rp32

billion, from Rp14 billion in 2014 to Rp46 billion US3 million in 2015.

h. Other Expenses Other expenses increased by Rp1,521 billion, from

Rp396 billion in 2014 to Rp1,917 billion US139 million in 2015.

3. Operating Proit and operating proit Margin

As a result of the foregoing, operating proit increased by Rp3,212 billion, or 11.0, from Rp29,206 billion in 2014 to Rp32,418 billion US2,351 million in 2015. Operating proit margin decreased from 32.6 in 2014 to 31.6 in 2015.

4. proit before income tax and pre-tax Margin

As a result of the foregoing, proit before income tax increased by Rp2,729 billion, or 9.5, from Rp28,613 billion in 2014 to Rp31,342 billion US2,273 million in 2015. Pre-tax margin decreased from 31.9 in 2014 to 30.6 in 2015.