FINANCIAL STATEMENTS QUARTER 2

10. APPROPRIATIONS OF EARNINGS On April 23, 1999, the Ordinary General Meeting of Shareholders approved the proposed dividend payable from the net income of the year 1998 of Baht 1.75 per share on 8 million shares totaling Baht 14 million and the appropriation legal reserve for the year 1998 in the amount of Baht 2,344,267.61. On April 23, 1998, the Ordinary General Meeting of Shareholders approved the proposed dividend payable from the net income of the year 1997 of Baht 1.25 per share on 8 million shares totaling Baht 10 million and the appropriation of 5% net income for the year 1997 to legal reserve in the amount of Baht 1,631,520.32. 11. 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. NCD of financial institution in the amount of Baht 8.1 million was pledged as collateral for loan with Export Import Bank of Thailand. 12. COMMITMENTS The Company has entered into land lease agreement with a related company for a period of 3 years. The monthly rental fee is Baht 273,250. At June 30, 1999 the Company is committed to pay future rentals amounting to approximately Baht 2.5 million. 13. CONTINGENCIES The Company had a protion of building and land improvement which are located on a related company's land without a lease agreement. In 1998 the related company charged the Company for rental fees of Baht 24.1 million for the preceding five year since 1994 to 1998. The company is in the process of negotiation with the related company and the amount of liabilities about rent for the said land is not yet finalized in this moment. The Company did not record this liability about rent for the said land upto the present. 14. YEAR 2000 PROBLEM AND COMPUTER REMEDY PLAN The Year 2000 problem arises because many computerized systems use two digits rather than four to identify the year. Date-sensitive system may recognize the year 2000 as some other dates resulting in errors when information using year 2000 dates is processed. Entities may experience the effects of Year 2000 problem before on or after January 1, 2000 and the effects to significant system failure which could affect an entity's ability to conduct normal business operations. In addition, it is not possible to be certain that all aspects of the year 2000 problem affecting the entity, including those related to the efforts of customers, suppliers or other third parties, will be fully resolved. In August 1998, the Company commenced its plan to improve its computerized system (hardware and software) in respect of resolving the year 2000 compliance problem. The plan is expected to be completed by August 1999. The expected costs of remedying the problem is approximately Baht 400,000 and these costs will be recognized in the period in which they occur. However no expenditure in relation to remedy project incurred during the period ended June 30, 1999. Although the Company expects to remedy its year 2000 compliance problems by the time Year 2000, it still remains a risk from other entities with which the Company undertakes business if they are unable to remedy their own problems in time. The effects can not be determined presently. 15. RECLASSIFICATION OF ACCOUNTS Certain accounts in the 1998 interim financial statements were reclassified to conform with the 1999 interim financial statements presentation. 16. 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, 1999, the number of employees of the company is approximately 1,370 persons. e) Supplemental disclosures of expense information Supplemental disclosures of expense information for the three-month and six- month periods ended June 30, 1999 and 1998 are as follows: In Thousand Baht For the three-month For the six-month period ended June 30, period ended June 30, 1999 1998 1999 1998 Depreciation 4,900 5,522 9,770 11,011 Amortization 1,121 439 2,193 874 Employee benefit costs 38,664 33,610 77,583 65,850 Unrealized gain on trading securities-unit trust 270 - 270 -