SET Announcements

DECEMBER 31, 1999 (AUDITED) b) the bondholders will convert the entire of bonds amounting to USD 140 million as the 8 years pure bond and bear interest at the rates ranging from 7.00% - 8.75% p.a.. c) the Company will issue the incremental share amounting to 75 million shares at the price of approximately Baht 8.5 per share, 65 million shares of which shall be offered to the existing shareholders and 10 million shares of which shall be offered to specific investors. The said debt restructuring plan set forth certain conditions with which the Company is required to comply. Management of the Company believes that the Company will be able to comply with the conditions under the plan. The said debt restructuring plan had been already approved from the Steering Committee of Bondholders in October , 2000. However, this is subject to the final approval from the Company shareholders. Management of the Company believes that the Company shareholders will agree and approve the said debt restructuring plan. 6.10 Segment Financial Information Details of financial data by segments for the periods ended September 30, 2000 and 1999 were as follows: Consolidated financial statements In Million Baht Information Industrial and Technology Consumer Products Trading Others Total 2000 1999 2000 1999 2000 1999 2000 1999 (Restated) (Restated) (Restated) (Restated) Net sales 2,262 2,402 2,080 2,484 111 169 4,453 5,055 Cost of sales (1,494) (1,558) (1,742) (2,090) ( 68) ( 110) ( 3,304) (3,758) Gross profit 768 844 338 394 43 59 1,149 1,297 Operating profit 62 241 95 160 150 161 307 562 Dividend income from investments in other companies 22 22 Central expenses ( 261) ( 230) Interest expense ( 291) ( 310) Directors' remuneration ( 5) ( 3) Other expenses ( 266) ( 273) Equity in results of operations of associated companies - net 227 257 Loss on exchange rates ( 1,169) (1,104) Corporate income tax ( 44) 383 Minority interest in net (income) loss of subsidiaries 4 ( 30) Net loss ( 1,476) ( 726) Fixed assets - net 556 573 22 31 867 966 1,445 1,570 Other assets 10,765 11,312 Total assets 12,210 12,882 NOTES TO INTERIM FINANCIAL STATEMENTS (Continued) SEPTEMBER 30, 2000 AND 1999 (REVIEWED) DECEMBER 31, 1999 (AUDITED) The Company Financial Statements In Million Baht Industrial and Information Consumer Technology Products Trading Others Total 2000 1999 2000 1999 2000 1999 2000 1999 Net sales 979 1,212 640 635 69 55 1,688 1,902 Cost of sales (780) ( 956) (530) ( 480) ( 44) ( 34) (1,354) ( 1,470) Gross profit 199 256 110 155 25 21 334 432 Operating profit 52 101 53 94 119 159 224 354 Dividend income from investments in other companies 22 22 Central expenses ( 261) ( 230) Interest expense ( 228) ( 218) Directors' remuneration ( 4) ( 2) Other expenses ( 253) ( 271) Equity in results of operations of subsidiaries and associated companies-net 236 317 Loss on exchange rates (1,165) ( 1,108) Corporate income tax - 431 Net loss (1,429) ( 705) Fixed assets - net 51 70 13 20 462 531 526 621 Other assets 9,635 10,118 Total assets 10,161 10,739 The Company and subsidiaries operate in two major businesses, Information Technology and Industrial and Consumer Products Trading. Operating profit of each segment was determined by deducting costs and operating expenses from the total revenues. Central expenses, interest expense, directors' remuneration, other expenses and corporate income tax were exclusive from segment operating profit calculation. Fixed assets of each segment were assets used in those segments' operations. Other assets consisted mainly of cash on hand and at banks, inventories and investment in stocks. 6.11 Agreements As at September 30, 2000 and 1999: a) A subsidiary has an agreement with the Telephone Organization of Thailand (TOT) for the latter to allow the subsidiary to provide paging services within an agreed period. By virtue of this agreement, the subsidiary is committed to transfer the ownership of communications network to TOT which subsequently grant right to use the network over the term of the license to the subsidiary. In this connection, the subsidiary has to pay compensations to TOT at the rates as stipulated in the agreement. Additional, the subsidiary was required to provide a bank guarantee of Baht 141.1 million to TOT to guarantee its performance. A portion of banks guarantees was collateralized by the pledge of fixed deposit account approximately Baht 18.8 million. b) A subsidiary and the Communication Authority of Thailand (CAT) have entered into an agreement to invest in the satellite transmission services project. By virtue of this agreement, the subsidiary is committed to supply, install, control and maintenance all tools and equipment as agreed in the agreement. In addition, the subsidiary must transfer the ownership of such tools and equipment to CAT at the first day on which service be rendered. The agreement shall be in effect for a period of twenty-two (22) years commencing from the first day on which service be rendered or twelve (12) months subsequently date of an agreement, whichever is occurrence, without cancellation right except for those specified in the agreement. During the period of agreement, the subsidiary has the right to charge service fee and other fees from the users as stipulated in the agreement. c) A subsidiary entered into a call service center agreement with certain local companies. The term of this agreement for a period of five (5) years commencing from August 19, 1997, without cancellation right except for those specified in the agreement, the subsidiary has the right to charge service fee as stipulated in the agreement. NOTES TO INTERIM FINANCIAL STATEMENTS (Continued) SEPTEMBER 30, 2000 AND 1999 (REVIEWED) DECEMBER 31, 1999 (AUDITED) d) A subsidiary entered into a distribute on-line charitable lotteries and award prizes agreement with the Thai Government Lottery Office (GLO). Under the terms of the agreement, the subsidiary is committed to supply and install distribute on-line lottery equipment and shall have to comply with certain conditions and restrictions as specified in the agreement. This agreement shall be in effect for a period of ten (10) years, without cancellation right except for those specified in the agreement. During the period of the agreement, the subsidiary has the right to charge service fee from distribution the said lottery as stipulated in the agreement. However, in November 1999, the subsidiary had submitted the letter to terminate the said agreement because GLO cannot comply with certain conditions in that agreement. The subsidiary is in the process of seeking recovery of compensation for this project through legal action. However, the subsidiary had already wrote - off the losses on that project in full. 6.12 Commitments and Contingent Liabilities a) As at September 30, 2000, the Company had terminal station space agreements for a period of three (3) years commencing from December, 1999. Total annual rental is approximately Baht 16.7 million. b) The Company and subsidiaries had unused letters of credit of approximately Baht 217 million ( Baht 188 million for the Company) as at September 30, 2000 and Baht 466 million (Baht 428 million for the Company) as at September 30, 1999. c) The Company and subsidiaries were contingently liable to their customers for the tender guarantees. These tender guarantees were covered by the banks' letters of guarantee totalling approximately Baht 801 million (Baht 553 million for the Company) as at September 30, 2000 and Baht 562 million (Baht 305 million for the Company) as at September 30, 1999. d) The Company had commitments under the contracts with certain banks whereby the Company committed to buy certain foreign currencies at the forward rates at the amount equivalent to approximately Baht 227 million as at September 30, 2000 and Baht 166 million as at September 30, 1999. 6.13 Reclassification of accounts Certain accounts in the 1999 financial statements have been reclassified to conform with the 2000 financial statement presentation.