AUDITOR'S REPORT ON REVIEW OF INTERIM FINANCIAL STATEMENTS To the Shareholders of Central Pattana Public Company Limited I have performed a review of the accompanying consolidated and company balance sheet of Central Pattana Public Company Limited as at 30 September 1999 and the related consolidated and company statement of income, changes in shareholders' equity, retained earnings, and cash flows for the three-month and nine-month periods then ended. These financial statements are the responsibility of the Company's management. My responsibility is to issue a report on these interim financial statements based on my review. The interim consolidated and company financial statements for the three-month and nine-month periods ended 30 September 1998 of Central Pattana Public Company Limited, presented herewith for comparative purpose, except for the consolidated and company statement of cash flows, were reviewed by another independent auditor whose report dated 27 October 1998, expressed that he was not aware of any material modifications that should be made to those interim financial statements for them to be in conformity with generally accepted accounting principles. I conducted my review in accordance with standards established by the Institute of Certified Accountants and Auditors of Thailand. A review of interim financial statements consists principally of obtaining an understanding of the system for the preparation of the financial statements, making an analytical review of pertinent financial data, and making inquiries of officials of the company who have responsibility for financial and accounting matters. This review is substantially less in scope than an examination in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, I express no opinion on the financial statements which I have reviewed. Based on my review, I am not aware of any material modifications that should be made to the interim consolidated and company financial statements referred to in the first paragraph for them to be in conformity with generally accepted accounting principles in Thailand. As explained in note 1(a) to the interim financial statements, the company prepared and presented the consolidated and company statement of cash flows for the three-month and nine-month periods ended 30 September 1998 which were not prepared previously. I have reviewed the information presented in those statements and found that such information is consistent with the information contained in consolidated and company financial statements for the three-month and nine-month periods ended 30 September 1998, which were reviewed by another independent auditor. SOONTORN DENTHAM Certified Public Accountant (Thailand) No. 3340 PricewaterhouseCoopers ABAS Limited Bangkok 12 November 1999 The accompanying financial statements are not intended to present the financial position, results of operations, and cash flows in accordance with accounting principles and practices generally accepted in countries and jurisdictions other than Thailand. CENTRAL PATTANA PUBLIC COMPANY LIMITED BALANCE SHEETS (UNAUDITED) AS AT 30 SEPTEMBER ASSETS Consolidated Company 1999 1998 1999 1998 Notes Baht'000 Baht'000 Baht'000 Baht'000 CURRENT ASSETS Cash on hand and at banks 96,700 72,428 37,707 31,220 Short-term investments 3 88,736 738,394 74,817 686,451 Trade accounts receivable 4 189,563 251,445 111,621 168,146 Advances and loans to related companies 5 9,077 8,829 41,453 30,412 Other account receivable 6 449,093 - 449,093 - Other current assets 7 155,208 129,171 29,622 45,233 Total current assets 988,377 1,200,267 744,313 961,462 UNBILLED COMPLETED WORK - 70,364 - - LOANS TO RELATED COMPANIES 8 38,840 138,142 708,108 1,661,909 INVESTMENTS IN SUBSIDIARIES 9 - - 2,984,754 2,065,894 OTHER INVESTMENTS 10 189,280 215,479 120,314 146,513 PROPERTY AND EQUIPMENT 11 9,679,484 9,877,867 3,382,445 3,517,130 OTHER ASSETS 12 828,402 861,910 390,480 295,330 TOTAL ASSETS 11,724,383 12,364,029 8,330,414 8,648,238 The accounting policies and notes to interim financial statements on pages 14 to 30 form an integral part of these interim financial statements. CENTRAL PATTANA PUBLIC COMPANY LIMITED BALANCE SHEETS (UNAUDITED) AS AT 30 SEPTEMBER LIABILITIES AND SHAREHOLDERS' EQUITY Consolidated Company 1999 1998 1999 1998 Notes Baht'000 Baht'000 Baht'000 Baht'000 CURRENT LIABILITIES Bank loans and overdrafts 48,719 243,527 21,829 216,767 Trade accounts payable 2,399 5,523 2,884 3,543 Current portion of long-term loans due within one year 152,382 465,970 152,382 166,612 Advances and loans from related companies 4,836 - 29,360 - Income tax payable 187,220 117,467 181,495 110,768 Other current liabilities 13 435,288 454,792 172,661 209,982 Total current liabilities 830,844 1,287,279 560,611 707,672 LIABILITIES ARISING FROM INVESTMENT IN SUBSIDIARY - - - 7,404 LOAN FROM RELATED COMPANIES AND DIRECTORS - 1,870 - - LONG-TERM LOANS 1,918,246 1,922,915 797,618 772,915 EURO CONVERTIBLE BOND 1,827,735 2,105,892 1,827,735 2,105,892 UNEARNED RENTAL AND SERVICE INCOME 2,392,681 2,451,110 1,371,596 1,462,761 DEPOSITS RECEIVED FROM CUSTOMERS 655,705 617,557 458,707 431,728 GUARANTEE FOR LEASEHOLD RIGHT 94,332 140,430 4,414 810 Total liabilities 7,719,543 8,527,053 5,020,681 5,489,182 MINORITY INTERESTS 695,107 677,920 - - SHAREHOLDERS' EQUITY Share capital 14 1,000,000 1,000,000 1,000,000 1,000,000 Share premium 1,185,000 1,185,000 1,185,000 1,185,000 Surplus on revaluation of land 15 112,594 112,594 112,594 112,594 Unrealised gain (loss) of investment in securities - available-for-sale 1,140 (18,750) 1,140 (18,750) Retained earnings : Appropriated - legal reserve 121,000 97,343 121,000 97,343 Unappropriated 889,999 782,869 889,999 782,869 Total shareholders' equity 3,309,733 3,159,056 3,309,733 3,159,056 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 11,724,383 12,364,029 8,330,414 8,648,238 The accounting policies and notes to interim financial statements on pages 14 to 30 form an integral part of these interim financial statements. CENTRAL PATTANA PUBLIC COMPANY LIMITED STATEMENTS OF INCOME (UNAUDITED) FOR THE THREE-MONTH PERIOD ENDED 30 SEPTEMBER Consolidated Company 1999 1998 1999 1998 Note Baht'000 Baht'000 Baht'000 Baht'000 REVENUES Rental and service income 537,568 488,384 340,666 304,347 Food and beverage sales 108,056 83,969 - - Interest income 6,102 26,597 14,451 65,368 Gain from redemption of convertible bonds - 87,427 - 87,427 Gain on foreign exchange - 130,553 - 130,553 Other income 16 18,804 37,322 19,110 25,705 Total revenues 670,530 854,252 374,227 613,400 EXPENSES Cost of rental and service 253,644 255,668 113,095 117,974 Cost of food and beverage sales 78,561 59,867 - - Administrative expenses 73,083 60,057 39,203 26,575 Loss on foreign exchange 179,561 - 179,561 - Loss on impairment in value of other investments 776 17,640 776 17,640 Doubtful debt on loan to related company 40,000 - 40,000 - Provision for loss of property under development - 114,450 - 114,450 Directors' remuneration 4,131 3,525 4,131 3,525 Interest expense 106,336 207,191 77,806 140,566 Total expenses 736,092 718,398 454,572 420,730 OPERATING INCOME (LOSS) (65,562) 135,854 (80,345) 192,670 INCOME TAX 19,307 (59,306) 22,685 (56,580) INCOME (LOSS) BEFORE SHARE OF RESULTS IN SUBSIDIARIES (46,255) 76,548 (57,660) 136,090 SHARE OF RESULTS IN SUBSIDIARIES - - 6,662 (56,145) INCOME (LOSS) BEFORE MINORITY INTERESTS (46,255) 76,548 (50,998) 79,945 MINORITY INTERESTS (4,743) 3,397 - - NET INCOME (LOSS) FOR PERIOD (50,998) 79,945 (50,998) 79,945 EARNINGS (LOSS) PER SHARE (Baht) - basic (0.51) 0.80 (0.51) 0.80 - diluted (0.51) 0.19 (0.51) 0.19 The accounting policies and notes to interim financial statements on pages 14 to 30 form an integral part of these interim financial statements. CENTRAL PATTANA PUBLIC COMPANY LIMITED STATEMENTS OF INCOME (UNAUDITED) FOR THE NINE-MONTH PERIOD ENDED 30 SEPTEMBER Consolidated Company 1999 1998 1999 1998 Notes Baht'000 Baht'000 Baht'000 Baht'000 REVENUES Rental and service income 1,605,449 1,460,227 1,020,663 919,185 Food and beverage sales 296,346 205,871 - - Interest income 31,491 199,525 60,450 256,748 Gain from redemption of convertible bonds 56,185 87,427 56,185 87,427 Gain on foreign exchange - 336,252 - 336,252 Other income 16 87,620 92,391 66,090 70,301 Total revenues 2,077,091 2,381,693 1,203,388 1,669,913 EXPENSES Cost of rental and service 751,751 737,946 339,427 332,483 Cost of food and beverage sales 217,984 158,206 - - Cost of condominium leasehold right 17 1,093 - - - Administrative expenses 239,521 231,627 139,421 141,609 Loss on foreign exchange 184,533 - 184,533 - Loss on impairment in value of other investments 960 269,126 338 269,126 Doubtful debt on loan to related company 80,000 43,899 80,000 43,899 Provision for loss of property under development 30,000 114,450 - 114,450 Directors' remuneration 10,971 7,513 10,971 7,513 Interest expense 305,623 480,383 208,842 301,383 Total expenses 1,822,436 2,043,150 963,582 1,210,463 OPERATING INCOME 254,655 338,543 239,856 459,450 INCOME TAX (85,259) (85,320) (74,007) (75,036) INCOME BEFORE SHARE OF RESULTS IN SUBSIDIARIES 169,396 253,223 165,849 384,414 SHARE OF LOSS IN SUBSIDIARIES - - (14,848) (106,085) INCOME BEFORE MINORITY INTERESTS 169,396 253,223 151,001 278,329 MINORITY INTERESTS (18,395) 25,106 - - NET INCOME FOR PERIOD 151,001 278,329 151,001 278,329 EARNINGS PER SHARE (Baht) - basic 1.51 2.78 1.51 2.78 - diluted 1.51 0.87 1.51 0.87 The accounting policies and notes to interim financial statements on pages 14 to 30 form an integral part of these interim financial statements. CENTRAL PATTANA PUBLIC COMPANY LIMITED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (UNAUDITED) FOR THE THREE-MONTH PERIOD ENDED 30 SEPTEMBER Consolidated Company 1999 1998 1999 1998 Baht'000 Baht'000 Baht'000 Baht'000 Share capital Balance, beginning of period 1,000,000 1,000,000 1,000,000 1,000,000 Add: Transactions during period - - - - Balance, end of period 1,000,000 1,000,000 1,000,000 1,000,000 Share premium Balance, beginning of period 1,185,000 1,185,000 1,185,000 1,185,000 Add: Transactions during period - - - - Balance, end of period 1,185,000 1,185,000 1,185,000 1,185,000 Surplus on revaluation of land Balance, beginning of period 112,594 112,594 112,594 112,594 Add: Transactions during period - - - - Balance, end of period 112,594 112,594 112,594 112,594 Unrealised gain (loss) of investment in securities available-for-sale Balance, beginning of period 1,191 (18,650) 1,191 (18,650) Add: Transactions during period (51) (100) (51) (100) Balance, end of period 1,140 (18,750) 1,140 (18,750) Retained earnings Appropriated retained earnings - legal reserve Balance, beginning of period 121,000 97,343 121,000 97,343 Add: Additional reserve - - - - Balance, end of period 121,000 97,343 121,000 97,343 Unappropriated retained earnings Balance, beginning of period 940,997 702,924 940,997 702,924 Less: Dividend - - - - Add: Net income (loss) for period (50,998) 79,945 (50,998) 79,945 Balance, end of period 889,999 782,869 889,999 782,869 TOTAL SHAREHOLDERS' EQUITY 3,309,733 3,159,056 3,309,733 3,159,056 The accounting policies and notes to interim financial statements on pages 14 to 30 form an integral part of these interim financial statements. CENTRAL PATTANA PUBLIC COMPANY LIMITED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (UNAUDITED) FOR THE NINE-MONTH PERIOD ENDED 30 SEPTEMBER Consolidated Company 1999 1998 1999 1998 Baht'000 Baht'000 Baht'000 Baht'000 Share capital Balance, beginning of period 1,000,000 1,000,000 1,000,000 1,000,000 Add: Transactions during period - - - - Balance, end of period 1,000,000 1,000,000 1,000,000 1,000,000 Share premium Balance, beginning of period 1,185,000 1,185,000 1,185,000 1,185,000 Add: Transactions during period - - - - Balance, end of period 1,185,000 1,185,000 1,185,000 1,185,000 Surplus on revaluation of land Balance, beginning of period 112,594 112,594 112,594 112,594 Less: Transactions during period - - - - Balance, end of period 112,594 112,594 112,594 112,594 Unrealised gain (loss) of investment in securities available-for-sale Balance, beginning of period - (18,750) - (18,750) Less: Transactions during period 1,140 - 1,140 - Balance, end of period 1,140 (18,750) 1,140 (18,750) Retained earnings Appropriated retained earnings - legal reserve Balance, beginning of period 121,000 97,343 121,000 97,343 Add: Additional reserve - - - - Balance, end of period 121,000 97,343 121,000 97,343 Unappropriated retained earnings Balance, beginning of period 838,998 504,540 838,998 504,540 Less: Dividend (100,000) - (100,000) - Add: Net income for period 151,001 278,329 151,001 278,329 Balance, end of period 889,999 782,869 889,999 782,869 TOTAL SHAREHOLDERS' EQUITY 3,309,733 3,159,056 3,309,733 3,159,056 The accounting policies and notes to interim financial statements on pages 14 to 30 form an integral part of these interim financial statements. CENTRAL PATTANA PUBLIC COMPANY LIMITED STATEMENTS OF RETAINED EARNINGS (UNAUDITED) FOR THE THREE-MONTH PERIOD ENDED 30 SEPTEMBER Consolidated Company 1999 1998 1999 1998 Baht'000 Baht'000 Baht'000 Baht'000 Unappropriated retained earnings Balance, beginning of period 940,997 702,924 940,997 702,924 Less: Dividend - - - - Add: Net income (loss) for period (50,998) 79,945 (50,998) 79,945 Balance, end of period 889,999 782,869 889,999 782,869 Appropriated retained earnings - legal reserve Balance, beginning of period 121,000 97,343 121,000 97,343 Add: Transactions during period - - - - Balance, end of period 121,000 97,343 121,000 97,343 TOTAL RETAINED EARNINGS 1,010,999 880,212 1,010,999 880,212 The accounting policies and notes to interim financial statements on pages 14 to 30 form an integral part of these interim financial statements. CENTRAL PATTANA PUBLIC COMPANY LIMITED STATEMENTS OF RETAINED EARNINGS (UNAUDITED) FOR THE NINE-MONTH PERIOD ENDED 30 SEPTEMBER Consolidated Company 1999 1998 1999 1998 Baht'000 Baht'000 Baht'000 Baht'000 Unappropriated retained earnings Balance, beginning of period 838,998 504,540 838,998 504,540 Less: Dividend (100,000) - (100,000) - Add: Net income for period 151,001 278,329 151,001 278,329 Balance, end of period 889,999 782,869 889,999 782,869 Appropriated retained earnings - legal reserve Balance, beginning of period 121,000 97,343 121,000 97,343 Add: Transactions during period - - - - Balance, end of period 121,000 97,343 121,000 97,343 TOTAL RETAINED EARNINGS 1,010,999 880,212 1,010,999 880,212 The accounting policies and notes to interim financial statements on pages 14 to 30 form an integral part of these interim financial statements. CENTRAL PATTANA PUBLIC COMPANY LIMITED STATEMENTS OF CASH FLOWS (UNAUDITED) FOR THE THREE-MONTH PERIOD ENDED 30 SEPTEMBER Consolidated Company 1999 1998 1999 1998 Baht'000 Baht'000 Baht'000 Baht'000 CASH FLOWS FROM OPERATING ACTIVITIES: Net income (loss) for period (50,998) 79,945 (50,998) 79,945 Minority interests 4,743 (3,397) - - Interest expense 106,336 207,191 77,806 140,566 Income tax (19,307) 59,306 (22,685) 56,580 Income (loss) before interest expense and tax 40,774 343,045 4,123 277,091 Adjustments to reconcile income before interest and tax to net cash from operating activities:- Depreciation and amortisation 116,453 120,197 55,976 56,940 Amortisation of unearned rental income (46,418) (48,479) (22,464) (25,535) Share of (income) loss in subsidiaries - - (6,662) 56,145 Gain from redemption of convertible bonds - (87,427) - (87,427) Impairment charge and doubtful accounts 34,588 143,903 38,119 132,091 Loss (gain) on exchange 175,585 (113,511) 175,585 (113,511) Movement in working capital (Note 18) (375,564) 72,783 (436,135) 24,004 Cash (outflow) inflow from operating activities before interest and tax (54,582) 430,511 (191,458) 319,798 Interest expense paid (82,500) (169,352) (53,938) (103,323) Income tax paid - - - - Net cash from (used in) operating activities (137,082) 261,159 (245,396) 216,475 CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of property and equipment (32,222) (51,400) (4,141) (1,429) (Increase) in advances and loans to related company (31) (15,272) (40,624) (58,065) Investment in subsidiaries - - (105,557) - Proceeds from sale of investment in subsidiary - - 71,999 - Dividend received - - - 25,000 Net cash (used in) from investing activities (32,253) (66,672) (78,323) (34,494) The accounting policies and notes to interim financial statements on pages 14 to 30 form an integral part of these interim financial statements CENTRAL PATTANA PUBLIC COMPANY LIMITED (more)