Indosat Ooredoo, the second largest mobile operator in Indonesia, reported brisk growth in mobile data revenue in Q1, which helped fuel a solid increase in consolidated turnover, but its profit declined from a year ago due to higher expenses.

Its net profit during the quarter fell 20 per cent from a year earlier to IDR174 billion ($13.1 million).

Consolidated revenue increased 7 per cent year-on-year to IDR7.3 trillion, with cellular revenue rising 6.6 per cent to IDR6.1 trillion. Strong gains in mobile data and value-added service revenue offset decreases in voice, SMS and interconnection revenue. SMS revenue continued to decline, dropping 11 per cent year-on-year, while voice turnover fell 4.8 per cent.

The operator, with a 24 per cent market share, said an increase in data subscribers drove 40.5 per cent growth in mobile data revenue, with data traffic more than tripling year-on-year. Quarterly data revenue grew faster than traffic, which the company said indicated its progress in monetising data usage.

Its mobile subscriber base jumped 37 per cent from Q1 2016 to 95.6 million customers at the end of the recent quarter. Mobile ARPU fell 17.8 per cent to IDR21,700.

The company added nearly 6,000 base stations in the year to end-March, with 58 per cent of the new sites 3G and 4G. The operator said its expanded network coverage drove up service expenses. Capex in Q1 was 11.8 per cent higher than the same period of 2016.

Overall expenses in Q1 2017 rose 8.3 per cent from a year ago to IDR6.46 trillion.

Indosat said it reduced its US dollar debt by 55 per cent year-on-year to $159 million in Q1 2017, representing 11 per cent of total debt – down from 21 per cent in Q1 2016. Total outstanding debt declined 12.6 per cent to IDR2.8 trillion.

For the full year, it expects consolidated revenue to grow in line with the market and forecasts capex at IDR6 trillion (capex in 2016 was IDR7.3 trillion).