Jakarta. XL Axiata, Indonesia’s second-largest mobile phone operator by users, posted a Rp 901.2 billion ($74.5 million) loss in the first nine-month of this year, a huge swing from the Rp 917 billion in profit in the same period last year, the company said in a filing to the Indonesian stock exchange.
XL, majority owned by Malaysian telecommunication company Axiata Group, posted a 10.9 percent increase in its revenue in the period, but it wasn’t enough to offset the drag of its rising costs.
XL’s infrastructure expenses increased 43.5 percent to Rp 6.3 trillion.
This has put pressure on XL’s operating profit, which declined by 89.5 percent to Rp 138.13 billion.
XL’s net foreign exchange loss has also increased to Rp 935.5 billion up from Rp 714.6 billion.
The company has made efforts to reduce expenses and lower its maintenance costs, including selling telecommunication towers, to enable it to focus on its mobile telecommunication businesses.
The company has signed an asset purchase agreement to sell 3,500 communication towers to Solusi Tunas Pratama, a telecommunication infrastructure company in a Rp 5.6 trillion deal.
According to the agreement, the sale is expected to be finalized at the end of the year and Solusi Tunas Pratama will pay off the transaction entirely in cash.
XL will be left with a remaining 6,500 towers after the sale.
XL Axiata has previously said that it was planning to use funds from the tower sale to refinance its $865 million debt that it used to acquire a stake in smaller mobile phone operator Axis Telekom Indonesia in March.