OPERATING RESULTS

Ref. TP-MT/033/43 (FC029/43) 29 February 2000 Subject: 1. Disclosure of Comparative Business Performance Between 1998 and 1999 2. Filing Audited Financial Statements and Reporting on Financial Status and Business Performance in 1999 Attention: Director and Manager SET Enclosure : Audited Financial Statements and Report of CPA for year Ended 1999, 2 copies (one in Thai, and another one in English) Referring to SET's regulation on Criteria, Conditions and Methods of Preparation and Filing the Financial Statements and Reporting on Financial Status and Business Performance of Listed Companies dated 19 May 1993 which required the company to clarify causes resulting in changes of business performance more than 20% from the same period of previous year. Thantawan Industry Public Co.,Ltd. (THIP) would like to clarify the major causes resulting in changing of business performance in 1999 from 1998 as followings : - 1. Total revenues of THIP had decreased from Bt.856.34 million in 1998 to Bt. 691.36 million in 1999 by amounting Bt. 164.98 million or as decreasing rate of 19.27% due to following causes : 1.1 Exporting revenue in U.S.Dollar had decreased from USD 19.39 million to USD 16.97 million in 1998-1999 respectively or decreasing by USD 2.42 million which accounted for 12.49% because those foreign competitors had decreased their selling price while THIP was unable to reduce its selling prices due to the reason clarified in item 2.1 below. 1.2 Foreign exchange rate between Baht and U.S.Dollar had by average appreciated in exchange value from Bt. 41.34 to the Dollar in 1998 to Bt. 37.63 to the Dollar in 1999 or having stronger value at 8.97%. 1.3 The impact resulted from 1.1 and 1.2 above had caused the selling revenue in 1999 decreasing to Bt. 665.42 million from Bt. 825.59 million in 1998 or decreasing by total Bt. 160.17 million which accounted for 19.40%. 2. By comparison in the form of Financial Common Size Statement had found these following major causes : 2.1 Cost of goods sales had increased from 64.41% of total revenues in 1998 to 72.16% of total revenues in 1999 due to increasing cost of major raw material that was resin which had average increasing cost from between Bt.23-25 per kilogram in 1998 to average resin cost per kilogram of Bt. 25-29 in 1999 or as average increasing cost rate at 16%. 2.2 Selling and Administrative Expenses had increased from 18% of total revenues in 1998 to 22.19% of total revenues in 1999 due to majority of expenses were fixed costs which did not vary with the revenues and another causing was payment of compensation for factory land utilization amounting Bt. 6.50 million in December 1999. 3. By these above reasons had resulted to the net profit in 1999 was Bt.27.75 million which decreased from Bt. 94.05 million in 1998 by decreasing amount of Bt. 66.30 million or as 70.50%. Please be informed accordingly, Sincerely yours, (Mr.Phietoon Trivijitkasem) (Mr.Pichai Tangvithetjit) Director Director