ANNUAL FINANCIAL STATEMENTS
03 March 1999
FINANCIAL STATEMENTS AND AUDITORS' REPORT
THANTAWAN INDUSTRY PUBLIC COMPANY LIMITED
DECEMBER 31, 1998 AND 1997
Auditors' Report
To the Shareholders of Thantawan Industry Public Company Limited:
We have audited the balance sheets of Thantawan Industry Public Company Limited as at
December 31, 1998 and 1997 , and the related statements of income, changes in shareholders'equity,
retained earnings and cash flows for each of the years then ended. The Company's management are
responsible for the correctness and completeness of information presented in these financial statements.
Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing standards. Those
standards require that we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by management, as well as
evaluating the overall financial statements presentation. We believe that our audits provide a reasonable
basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material
respects, the financial position of Thantawan Industry Public Company Limited at December 31, 1998
and 1997, and the results of its operations and cash flows for each of the years then ended, in conformity
with generally accepted accounting principles.
Without qualifying our opinion we draw attention to Note 8 to the financial statements, at
December 31, 1998 the Company had buildings and improvements at cost of Baht 8,474,659.75 (book
value of Baht 7,694,504.34) which are located on a related company's land without a lease agreement.
In 1998, the related company charged the Company Baht 24.1 million for rental fees for the preceding
five years from 1994 to 1998. The Company has not recorded this liability in the financial statements
because there is no agreement or other supporting evidence. In addition, as described in Note 9 to the
financial statements, the Company was attempting to purchase the land and building from the related
company. Advance payments for asset acquisitions at December 31, 1998 represent advance payments
according to an agreement to purchase the land and building from the related company in the amount of
Baht 20.5 million. The Company has given notice of cancellation of the agreement and requested a
refund of the advance payment since the Extraordinary Meetings of Shareholders did not approve the
purchase plan. At present, the advance payment has not been refunded and the Company is in the
process of negotiation with the related company. However there is no evidence to specify the timing for
reaching an agreement or receiving a refund of the advance payment. The 1998 financial statements do
not include any adjustments that might result from the outcome of this uncertainty.
Without qualifying our opinion, we draw attention to Note 1 to the financial statements. The
operations of Thantawan Industry Public Company Limited since 1997 have been affected and may
continue to be influenced for the foreseeable future by the adverse economic conditions in Thailand and
the Asia Pacific Region in general. The ultimate effect that these uncertainties will have on the financial
statements cannot presently be determined.
Nirand Lilamethwat
Certified Public Accountant
Registration Number 2316
KPMG Audit (Thailand) Limited
Bangkok, February 19, 1999
The accompanying financial statements are not intended to present the financial position and results of
operations and cash flows in accordance with accounting principles and practices generally accepted in
countries and jurisdictions other than Thailand. The standards, procedures and practices to audit such
financial statements are those generally accepted and applied in Thailand.
THANTAWAN INDUSTRY PUBLIC COMPANY LIMITED
BALANCE SHEETS AS AT DECEMBER 31, 1998 AND 1997
1998 1997
ASSETS Baht Baht
CURRENT ASSETS
Cash in hand and at banks (Note 12) 71,616,786.29 37,676,512.58
Short-term investments
Deposits with financial institutions 87,437,115.32 8,151,178.42
Trade accounts and notes receivable 83,393,195.84 125,293,441.15
Less Allowance for doubtful accounts (3,716,853.02) (3,068,214.59)
Trade accounts and notes receivable - net (Notes 4 and 5) 79,676,342.82 122,225,226.56
Inventories - net (Notes 4 and 6) 53,715,709.21 82,222,999.95
Other current assets
Refundable value added tax 12,731,609.63 11,262,668.95
Tax card 4,321,711.10 1,208,752.83
Subsidy for export tax 2,430,622.80 4,259,407.72
Others 1,463,127.15 2,720,096.07
Total Current Assets 313,393,024.32 269,726,843.08
INVESTMENTS - Net (Notes 4, 7 and 12) 8,240,660.89 8,305,430.14
PROPERTY, PLANT AND EQUIPMENT - Net (Notes 4, 8 and 12) 129,365,796.14 137,135,587.71
OTHER ASSETS
Advance payments for assets acquisition (Notes 2 and 9) 20,500,000.00 20,500,000.00
Deferred charges - net (Note 4) 1,176,548.32 4,207,255.57
Deposits 189,427.27 184,627.27
Total Assets 472,865,456.94 440,059,743.77
See notes to financial statements
THANTAWAN INDUSTRY PUBLIC COMPANY LIMITED
BALANCE SHEETS AS AT DECEMBER 31, 1998 AND 1997
1998 1997
LIABILITIES AND SHAREHOLDERS ' EQUITY Baht Baht
CURRENT LIABILITIES
Bank overdraft and loans from financial institutions (Note 12) 691,733.54 39,622,838.13
Trade accounts payable (Note 2) 55,578,583.70 105,664,568.36
Other current liabilities
Accrued expenses 25,143,956.20 15,966,559.37
Accrued income tax 42,832,559.86 13,216,109.79
Others 2,654,562.28 3,706,678.80
Total Current Liabilities 126,901,395.58 178,176,754.45
SHAREHOLDERS' EQUITY
Share capital
Authorized share capital 10,000,000 shares, Baht 10 par value 100,000,000.00 100,000,000.00
Issued and fully paid-up share capital 8,000,000 shares 80,000,000.00 80,000,000.00
Paid-in capital
Premium on share capital 136,800,000.00 136,800,000.00
Retained earnings
Appropriated
Legal reserve (Note 10) 7,655,732.39 6,024,212.07
Unappropriated 121,508,328.97 39,090,452.25
Unrealized loss on securities for investment (Note 4) - (31,675.00)
Total Shareholders' Equity 345,964,061.36 261,882,989.32
Total Liabilities and Shareholders' Equity 472,865,456.94 440,059,743.77
See notes to financial statements
THANTAWAN INDUSTRY PUBLIC COMPANY LIMITED
STATEMENTS OF INCOME
FOR THE YEARS ENDED DECEMBER 31, 1998 AND 1997
1998 1997
Baht Baht
REVENUES
Sales (Note 4) 825,585,193.28 590,609,051.33
Other income
Sales of scrap 15,138,060.34 11,180,921.45
Interest income 8,667,347.91 3,810,392.28
Others 7,597,772.17 5,084,041.68
Total Revenues 856,988,373.70 610,684,406.74
EXPENSES
Cost of sales (Note 2) 551,550,125.65 443,130,575.64
Selling and administrative expenses (Note 2) 167,358,187.06 117,279,302.24
Interest expense 1,106,540.37 3,506,126.76
Total Expenses 720,014,853.08 563,916,004.64
Income before income tax 136,973,520.62 46,768,402.10
Income tax expenses 42,924,123.58 14,137,995.77
Net income 94,049,397.04 32,630,406.33
Earnings per share (Note 4) 11.76 4.08
See notes to financial statements
THANTAWAN INDUSTRY PUBLIC COMPANY LIMITED
STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
FOR THE YEARS ENDED DECEMBER 31, 1998 AND 1997
1998 1997
Baht Baht
Share capital
Ordinary shares
Beginning balance 80,000,000.00 80,000,000.00
Additions - -
Ending balance 80,000,000.00 80,000,000.00
Paid-in capital
Premium on share capital
Beginning balance 136,800,000.00 136,800,000.00
Additions - -
Ending balance 136,800,000.00 136,800,000.00
Retained earnings
Appropriated
Legal reserve
Beginning balance 6,024,212.07 5,650,613.78
Additions 1,631,520.32 373,598.29
Ending balance 7,655,732.39 6,024,212.07
Unappropriated
Beginning balance 39,090,452.25 14,833,644.21
Additions 94,049,397.04 32,630,406.33
Deductions (11,631,520.32) (8,373,598.29)
Ending balance 121,508,328.97 39,090,452.25
Unrealized loss on securities for investment
Beginning balance (31,675.00) -
Additions - (31,675.00)
Deductions 31,675.00 -
Ending balance - (31,675.00)
Total Shareholders' Equity 345,964,061.36 261,882,989.32
See notes to financial statements
THANTAWAN INDUSTRY PUBLIC COMPANY LIMITED
STATEMENTS OF RETAINED EARNINGS
FOR THE YEARS ENDED DECEMBER 31, 1998 AND 1997
1998 1997
Baht Baht
Unappropriated retained earnings :
Beginning balance 39,090,452.25 14,833,644.21
Less Appropriations of earnings for prior year (Note 10)
Legal reserve (1,631,520.32) (373,598.29)
Dividend (10,000,000.00) (8,000,000.00)
Net income for the year 94,049,397.04 32,630,406.33
Total Unappropriated Retained Earnings 121,508,328.97 39,090,452.25
Appropriated retained earnings :
Legal reserve 7,655,732.39 6,024,212.07
Total Retained Earnings 129,164,061.36 45,114,664.32
See notes to financial statements
THANTAWAN INDUSTRY PUBLIC COMPANY LIMITED
STATEMENTS OF CASH
FLOWS
FOR THE YEARS ENDED DECEMBER 31, 1998 AND
1997
1998 1997
Baht Baht
CASH FLOWS FROM OPERATING ACTIVITIES
Net income 94,049,397.04 32,630,406.33
Add (less) Adjustments to reconcile net income to net cash
provided by operating activities
Allowance for doubtful accounts 648,638.43 (2,656,186.11)
Allowance for devalue of inventories 3,582,253.53 530,704.59
Allowance for diminution in value of investment 96,444.25 -
Loss (gain) on disposal of property , plant and equipment 3,377.48 (573,187.00)
Depreciation and amortization (Note 9) 22,183,215.15 25,672,237.50
Deferred charges written off 3,030,707.25 1,162,321.58
Net income from operations before changes of operating
assets and liabilities 123,594,033.13 56,766,296.89
(INCREASE) DECREASE IN OPERATING ASSETS
Accounts receivable 41,900,245.31 (36,354,527.89)
Inventories 24,925,037.21 (9,516,157.80)
Other current assets (1,496,145.11) (14,273,022.65)
Other assets (4,800.00) (19,767,727.27)
INCREASE (DECREASE) IN OPERATING LIABILITIES
Accounts payable (50,085,984.66) 43,314,290.09
Accrued expenses 9,177,396.83 7,707,701.16
Accrued company income tax 29,616,450.07 13,216,109.79
Other current liabilities (1,052,116.52) 2,740,706.65
Net Cash Provided by Operating Activities 176,574,116.26 43,833,668.97
CASH FLOWS FROM INVESTING ACTIVITIES
Increase in investments - (8,090,592.64)
Proceeds from disposal of property , plant and equipment 454.54 1,350,058.60
Purchases of property, plant and equipment (14,417,255.60) (20,151,872.82)
Net Cash Used in Investing Activities (14,416,801.06) (26,892,406.86)
See notes to financial statements
1998 1997
Baht Baht
CASH FLOWS FROM FINANCING ACTIVITIES
(Decrease) increase in loans from financial institutions (34,804,692.00) 15,583,091.94
Payment of dividend (10,000,000.00) (8,000,000.00)
Net Cash (Used in) Provided by Financing Activities (44,804,692.00) 7,583,091.94
NET INCREASE IN CASH AND CASH EQUIVALENTS 117,352,623.20 24,524,354.05
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR (Note 3) 40,009,544.87 15,485,190.82
CASH AT BANK PLEDGED AS COLLATERAL AT
BEGINNING OF YEAR (Notes 3 and 12) 1,000,000.00 1,000,000.00
CASH AT BANK PLEDGED AS COLLATERAL AT
END OF YEAR (Notes 3 and 12) (1,000,000.00) (1,000,000.00)
CASH AND CASH EQUIVALENTS AT END OF YEAR (Note 3) 157,362,168.07 40,009,544.87
SUPPLEMENTARY INFORMATION
Cash payment during the year
Interest expense 1,568,236.47 3,244,099.77
Income tax 13,307,673.51 921,885.98
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