INANCIAL STATEMENTS QUARTER 2/2000

Domestic post-dated cheques 573 576 Foreign post-dated cheques 870 2,373 87,581 102,098 Less Allowance for doubtful accounts (2,615) (2,711) Trade accounts and notes receivable net 84,966 99,387 "UNAUDITED" As at June 30, 2000 and December 31, 1999 the company has overdued accounts receivable of 21 and 12 accounts, respectively which are aging as follows : In Thousand Baht As at June As at December 30, 2000 31, 1999 Over 3 months to 6 months 124 465 Over 6 months to 12 months 53 - Over 12 months 2,681 2,732 Total 2,858 3,197 4. INVENTORIES Inventories consisted of : In Thousand Baht As at June As at December 30, 2000 31, 1999 Finished goods 21,802 19,900 Work in process 18,354 19,212 Raw materials 33,879 35,543 Supplies 12,557 13,549 Goods in - transit 1,872 - Total 88,464 88,204 Less Allowance for devalue of inventories (2,633) (2,633) Inventories, net 85,831 85,571 5. LONG-TERM INVESTMENTS Long- term investments consisted of : In Thousand Baht As at June As at December Type of Business 30, 2000 31, 1999 Thantawan Marketing Co.,Ltd. Holding company 150 150 First Bangkok City Bank Public Company Limited Banking - - Total General investment in equity securities 150 150 Negotiable certificate of deposit - - Total long-term investments 150 150 At June 30, 2000 and December 31, 1999, the Company had investments in equity security at cost of Baht 96,512.50 issued by the ailing financial institutions that have been supervisory controlled by the Bank of Thailand and ordered to write down capital which the Company has adjusted the related loss for diminution in value of Baht 96,444.25. At June 30, 2000 and December 31, 1999, investment in note receivable - financial institution in the amount of Baht 8,090,592.64 represent note receivable issued by the financial institution which has closed its business as its rehabilitation plan was not approved by the Financial Sector Restructuring Authority. In 1998 the Company exchanged the note to be the negotiable certificate of deposit (NCD) issued by Krung Thai Bank according to "Project of Krung Thai Bank in Accepting Exchange of Notes issued by the 42 Finance Companies". The maturity date is on December 12, 2000. Interest is receivable annually at the floating rate as announced by Krung Thai Bank. As at June 30, 2000 and December 31, 1999, the said NCD is pledged as collateral for loans granted from a bank and as at June 30, 2000, the Company presented the said NCD including in "Deposits with financial institutions" under "Short-term investments" in the balance sheets. 6. PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment consisted of : In Thousand Baht Balance per Additions Deduction Balance per Method of Estimated Book book as at book as at depreciation useful life Value at Dec 31'99 June. 30'00 (Years) June. 30'00 At Cost Land and improvements 16,198 73,351 - 89,549 Straight-line 5-20 86,116 Buildings and improvements 47,962 13,000 - 60,962 Straight-line 5-20 32,950 Machinery and equipment 183,570 7,642 (12) 191,200 Straight-line 5-10 72,977 Tools and equipment 12,499 563 (10) 13,052 Straight-line 5 3,259 Office furniture, fixtures and Equipment 6,317 30 - 6,347 Straight-line 5 681 Vehicles 15,420 95 (363) 15,152 Straight-line 5 3,481 Construction in progress and Machinery under installation 12,728 4,240 (6,575) 10,393 10,393 Total 294,694 98,921 (6,960) 386,655 Less Accumulated depreciation (167,839) (9,341) 382 (176,798) Property, plant and equipment, net 126,855 209,857 209,857 7. LAND AND ADVANCE PAYMENTS FOR ASSETS ACQUISITION WITH A RELATED COMPANY On December 29, 1997, the Company had entered into a to buy and to sell the land with building agreement with a related company at a price of Baht 41 million. The Company paid 50% of the price in amount of Baht 20.5 million on date of signing of the agreement. Subsequently, at the extraordinary shareholders' meetings held on January 22, 1998 and June 30, 1998, the shareholders did not approve to purchase the said land with building. Therefore the Company has notified for cancellation of the to buy and to sell agreement and refund the advance payment of Baht 20.5 million as its letter dated February 12, 1998. The advance payment could not been refunded. Addition, since 1994 the Company has utilized the 4 land plots of the said related company without lease agreement which the Company has a portion of building and land improvement located on certain land plots. Subsequently in 1998, the related company charged the Company for retroactive rental fees of Baht 24.1 million. The Company was negotiating with the related company. On November 25, 1999, the Board of Directors passed the resolution for entering into the memorandum with the said related company which are summarized as follows: (1) The Company commits to pay the compensation fee totalling fo Baht 6.5 million for land plots utilized since 1994 on November 29, 1999. (The Company recorded the compensation fee as expenses in the statements of income for the year ended December 31, 1999.) (2) The Company commits to enter into lease agreements covering land with building and 4 land plots at the rate of Baht 120 per square meter per month (totalling Baht 444,000 per month) and at the rate of Baht 50 per square wah per month (totalling Baht 252,100 per month), respectively. The period of the lease agreements is January 1, 2000 to December 31, 2000. (The Company has entered into lease agreements with the related company on January 4, 2000.) (3) The related company commits that it will not sell or lease the land with building and a land plot to others, except for to the Company for a period of 3 years from the date of agreement and also to stand the selling price of these assets at Baht 41.0 million for such period. In exchange, the related company will keep the above advance payment for asset acquisition of Baht 20.5 million during the period. On February 1, 2000, the Board of Directors passed the resolution of approval on purchasing of land with building and 4 land plots (as discussed in (2) above) from the said related company at the amount of Baht 85.0 million. The payment schedule had been assigned power to Managing Director as negotiation on condition of payment schedule with the related company. This resolution shall be presented further to the extraordinary meeting of shareholders. At the extra-ordinary shareholders' meeting held on February 28, 2000, the shareholders did not approve for transactions with a related company on the payment of compensation to the use of land, the entering into lease agreements covering land with building and 4 land plots, the keeping of advance payment on the purchase of land with building as stipulated in the agreement dated December 29, 1997, and the purchase of land with building and 4 land plots at the amount of Baht 85 million. However, at the extra-ordinary shareholders' meeting held on March 30, 2000, the shareholders had already approved the above related transactions and on March 31, 2000, the Company had entered into a to buy and to sell the land and building agreement and land totalling 8 title deeds with Sun Enterprise Company Limited at the amount of Baht 85 million and the Company committed to pay as follows :- (1) Payment by advance payment of Baht 20.5 million which had been paid under to buy and to sell land with building dated December 29, 1997. (2) Payment of Baht 34.5 million on the date of transferred registration. (The Company had entered the buy and sell agreement and registered the transference on April 4, 2000) (3) Payment the outstanding of Baht 30 million by the issue 6-month promissory note since the date of transferred registration. However, the Company paid this full amount on May 26, 2000 and received interest and bank charge discount totalling Baht 813,922.98. 8. DEPOSIT FOR MACHINE ACQUISITION The Company has entered into a machine acquisition agreement with a local company totalling Baht 61.75 million (exclusive VAT) on March 5, 1999. As at September 30, 1999, the company has paid 30% of the price in the amount of Baht 18.53 million (exclusive VAT), which was shown under "Other Assets" in the balance sheets. Under the term of the agreement, the seller shall deliver some machine which is not less than 30% of total value of machine within June 16, 1999. Consequently, the Company approved to delay the delivery totalling 2 times by the seller will deliver within September 16, 1999 and December 20, 1999, respectively, because the seller informed that it is abnormal after assembly of machine. Therefore the seller can not deliver in the present. The Company must pay 50% of the price in the amount of Baht 30.9 million when delivery completed and 20% of the price in the amount of Baht 12.4 million within 30 days after the date of installation and completed test-run of the machine. While the seller cannot deliver the machine, it should pay back the deposit to the company. Afterwards, on December 16, 1999, the Company and seller agreed to cancel the machine acquisition agreement because the seller cannot assemble the specified and qualified machine and the seller agreed to pay back the deposit of Baht 18.53 million and penalty fee of Baht 0.35 million on February 4, 2000. On January 7, 2000, the Company has entered into new machine acquisition agreement for new group of machine as specified in the agreement with the above company totalling Baht 19.18 million (exclusive VAT). The Company agreed to pay deposits of 18.53 million (exclusive VAT) on the date of agreement and the outstanding amount of Baht 0.65 million (exclusive VAT) will be paid within 30 days after the date of installation and completed test-run of the machine. The seller agreed to deliver at least 1 of 3 of total machine value within March 31, 2000 and June 30, 2000. The remain machine is delivered within September 29, 2000. In this case, the Company paid deposit for new agreement by the old deposit which the seller shall pay back since the cancellation of the former agreement. On March 15, 2000, the Company had notice to cancel the machine acquisition agreement. The Company had already received the refund on April 5, 2000. On May 15, 2000, the Company has entered into a machine acquisition agreement with a company to replace the old machine amounting to H.K.$ 8.7 million. As at June 30, 2000, the Company paid the deposit at the rate of 30% totalling H.K.S 2.6 million equivalent to Baht 13.17 million. Under the term of the agreement, the seller must delivery the completed test-run machine within 180 days since the date of the agreement. 9. CREDIT FACILITIES WITH FINANCIAL INSTITUTIONS As at June 30, 2000, the Company has overdraft lines of Baht 35 million and other credit facilities e.g. packing credit, letter of credit, and trust receipt and letter of guarantee totalling Baht 410 million. The almost overdraft lines are without collateral. 10. SEGMENT INFORMATION Thantawan Industry Public Company Limited manufactures plastic products which divided into three main products : straw products, HD.PE bag products and LD.PE bag products. Products purchased for sales are groups as others. The results of its operations for the three- month and six-month periods ended June 30, 2000 and 1999 are summarized as follows : For the three-month periods ended June 30, 2000 and 1999 In Thousand Baht HD. PE bag LD.PE bag 2000 1999 Straw products products products Others Total Total Sales-export : 2000 41,189 40,192 91,529 2,114 175,024 : 1999 35,227 30,920 80,638 4,260 151,045 Sales-local : 2000 12,528 2,767 579 64 15,938 : 1999 5,642 1,253 538 83 7,516 Total : 2000 53,717 42,959 92,108 2,178 190,962 : 1999 40,869 32,173 81,176 4,343 158,561 Operating profit : 2000 11,400 5,448 13,982 383 31,213 : 1999 8,832 1,798 15,814 860 27,304 Other income 1,713 152 General corporate expense (17,139) (12,470) Interest expense (105) (64) Income tax (4,882) (3,633) Net income 10,800 11,289 For the six-month periods ended June 30, 2000 and 1999 In Thousand Baht HD. PE bag LD.PE bag 2000 1999 Straw products products products Others Total Total Sales-export : 2000 70,007 86,147 182,118 5,017 343,289 : 1999 61,612 76,160 154,081 5,681 297,534 Sales-local : 2000 32,947 5,097 1,098 73 39,215 : 1999 14,344 2,222 1,248 171 17,985 Total : 2000 102,954 91,244 183,216 5,090 382,504 : 1999 75,956 78,382 155,329 5,852 315,519 Operating profit : 2000 20,538 10,690 26,297 808 58,333 : 1999 17,412 8,128 35,892 1,170 62,602 Other income 3,865 4,103 General corporate expense (35,980) (30,114) Interest expense (140) (69) Income tax (8,132) (10,527) Net income 17,946 25,995 As at June 30, 2000 and 1999, property, plant and equipment, net of accumulated depreciation are summarized as follows In Thousand Baht Straw products HD PE bag LD.PE bag 2000 1999 Products Products Total Total Assets used by products : 2000 14,384 38,647 56,952 109,983 : 1999 16,046 42,946 54,793 113,785 General assets used 99,060 13,370 Total property, plant and Equipment' net 209,043 127,155 11. APPROPRIATIONS OF EARNINGS On April 24, 2000 the Ordinary General Meeting of Shareholders No.1/2000 approved the proposed dividend payable from the net income of the year 1999 of Baht 1 per share on 8 million shares totalling Baht 8 million. On April 23, 1999, the Ordinary General Meeting of Shareholders No.1/1999 approved the proposed dividend payable from the net income of the year 1998 of Baht 1.75 per share on 8 million shares totalling Baht 14 million and the appropriation legal reserve for the year 1998 in the amount of Baht 2,344,267.61. 12. ASSETS PLEDGED AS COLLATERAL Fixed deposit in the amount of Baht 1 million and part of land and constructions were pledged as collateral for liabilities and commitments with commercial bank. The Company has requested to withdraw the land and constructions since December 1, 1999. NCD of financial institution in the amount of Baht 8.1 million was pledged as collateral for loan with a bank. 13. OTHERS a) Address and legal status The company has registered to be a limited public company under the Limited Public Company Act with the Ministry of Commerce on December 1, 1994 and its head office is located at 143-144, Moo 8, Soi Kangwal 2, Phetkasem Road, Omyai, Sampran, Nakornpratom ,Thailand. b) Nature the Company's operations The company's operations are produce and export plastic products. c) Name of parent company The parent company of the Company is Sunflower Company Limited. d) Number of employees As at June 30, 2000 the number of employees of the company is approximately 1,198 persons. e) Supplemental disclosures of expense information Supplemental disclosures of expense information for the three - month and six - month periods ended June 30, 2000 and 1999 are as follows: In Thousand Baht For the three-month period For the six-month period ended June 30, ended June 30, 2000 1999 2000 1999 Depreciation 4,758 4,900 9,341 9,770 Amortization 977 1,121 1,950 2,193 Employee benefit costs 31,370 38,664 74,347 77,583