Where a fibre operator's money is committed and measured

A city plan usually arrives as a single number, but a fibre network is paid for in pieces: the backbone into the city, the distribution cable along each street, the distribution points and, finally, the drop and router for each paying home. I ask our network and commercial teams to divide every programme into tranches that the board of directors can approve separately. The condition for the next tranche is evidence from the last one: paying connections per installed port, installation cost per connection and cancellations within the first six months. I am not trying to slow growth. A network built ahead of demand still carries interest, maintenance and depreciation while it waits. My contribution is to make that waiting cost visible, so that a decision to build early is made knowingly rather than by default.

Our customers pay in rupiah, yet optical line terminals, routers, splicing equipment and some cable are priced in dollars. I separate committed dollar orders from those still being planned, because only the first can be hedged sensibly. Treasury covers a defined share of the next twelve months of committed orders with forward contracts, matched to expected delivery dates rather than the budget calendar. Procurement looks for suppliers who will price in rupiah, even at a premium, where quality is acceptable. I report the forward premium honestly as a cost of certainty, not as a loss, and I show the board of directors what the programme would have cost without cover. I also keep watch on the rules Bank Indonesia applies to companies with foreign-currency obligations, with our advisers confirming each requirement.

Selling towers to a specialist owner can release capital at an attractive value, but it turns an owned asset into a long rental obligation. I examine each site by its future use rather than its present tenancy. Which towers will our own equipment still need, which carry links that fibre will not replace soon, and which have land titles that a buyer will discount? After a sale, I insist that lease liabilities sit beside bank debt whenever we report our debt ratios. Under the lease standard, rental payments fall below EBITDA, so a sale-and-leaseback can make operating profit look stronger while cash does not improve. I also read the operating clauses closely, especially power charges, relocation rights and price escalation, because those are where a good headline price can lose value over ten years.

A broadband operator's most quoted figure is its subscriber count, and it is easy to flatter. Accounts suspended for non-payment, promotional months without charge and business circuits counted as homes can all inflate the base. I want one definition, written down, applied in every market report and reconciled to billing. Today we count a home connection as paying when it has been billed and has not been suspended for more than thirty days. Investor relations, commercial and finance colleagues sign the reconciliation each quarter. I also report average revenue per paying home and monthly cancellations on the same base, because a rising count with falling revenue per home tells a different story. A slightly smaller, defensible number serves the company far better than a larger one that a lender or analyst later rebuilds.