11 Contingencies As of 31 March 2001, the Company and subsidiaries have contingent liabilities in respect of letter of guarantees issued by the banks in favor of a state enterprise for the consumption of electricity totaling of Baht 73.4 million (As at 31 December 2000: Baht 74.1 million). Central Pattana Public Company Limited Notes to the Interim Consolidated and Company Financial Statements (Unaudited) For the three-month periods ended 31 March 2001 and 2000 12 Cash Flows from Operating Activities Reconciliation of net profit to cash flows from operating activities for the three-month periods ended 31 March are as follows: Consolidated Company 2001 2000 2001 2000 Baht 000 Baht 000 Baht 000 Baht 000 (Restated) Net profit 155,672 127,096 155,672 127,096 Interest expense 87,547 86,215 74,663 67,996 Income tax 68,969 54,319 68,959 54,319 Minority interests -60 -951 - - Profit before interest and tax 312,128 266,679 299,294 249,411 Adjustments for: Depreciation and amortisation 107,291 112,757 45,039 46,120 Doubtful debts -108 -1,442 -132 - Loss on foreign exchange | bond 46,311 11,390 46,311 11,390 Share of profit of subsidiaries - - -40,633 -28,160 Gain on disposal of investments in subsidiaries -15,399 - -13,579 - Gain from redemption of Euro convertible bonds -3,016 - -3,016 - Recognise unearned rental and service income -38,975 -37,705 -22,120 -19,912 Unrealised loss from investment in trade marketable securities 1,430 - 1,430 - Changes in operating assets and liabilities: - Trade accounts receivable -2,063 9,875 -6,414 4,042 - Other current assets 5,662 -13,596 7,194 -14,587 - Deferred income tax - -12,630 - -11,034 - Other assets 5 -2,574 764 -256 - Trade accounts payable 3,243 -1,887 4,820 182 - Other current liabilities -33,505 -25,778 -33,785 -8,124 - Unearned rental income 10,065 -2,679 -4,732 -6,931 - Deposit from customers 6,045 17,211 3,538 6,278 - Guarantee for leasehold -1,034 -3,644 - - Cash generated from operations 398,080 315,977 283,979 228,419 Cash paid - interest expense -73,325 -52,046 -60,295 -33,666 - income tax -17,205 -109,362 -12,008 -106,243 Net cash from operating activities 307,550 154,569 211,676 88,510 Central Pattana Public Company Limited Notes to the Interim Consolidated and Company Financial Statements (Unaudited) For the three-month periods ended 31 March 2001 and 2000 13 Disposal of Subsidiary In January 2001 the Group disposed all of investment in Food Novelties Company Limited, a subsidiary. The subsidiary's net assets value at the disposal date and gain from sale of investment were as follows: Consolidated financial statements Baht 000 Cash on hand and at banks 7,720 Short-term investment 828 Trade accounts receivable, net 1,387 Advances to related parties 1,426 Inventories 3,460 Other current assets 45 Property and equipment, net 15,958 Other assets 908 Other payable -38 Short-term loan from related parties -19,550 Other current liabilities -2,543 Total 9,601 Less: Cash received from sale of investment -25,000 Gain from sale of investment -15,399 Cash received from sale of investment 25,000 Less: Cash and cash equivalent of subsidiary -7,720 Net proceeds on disposal of subsidiary 17,280 Company financial statements In 2000, the Company disposed Food Novelties Company Limited, a subsidiary to another subsidiary, Laungsuan Realty Co., Ltd. The Company had eliminated the gain between the Company and the subsidiary amounting to Baht 13.6 million in accordance with the accounting standard for investment in subsidiary. However, in 2001 the Group disposed Food Novelties Company Limited to a related company outside the Group. Therefore, the Company recognised the deferred gain from sale of the investment in 2001. 14 Prior Year Adjustment In August 2000, the Company entered into a joint venture agreement with an investor to jointly control Central Pattana Rama 3 Co., Ltd. In the preparation of interim consolidated financial statement for the three-month period ended 31 March 2000, Central Pattana Rama 3 Co., Ltd. was previously considered as a subsidiary of the Company in accordance to the Thai Accounting Standard No. 44 - Consolidated Financial Statements and Investments in Subsidiaries. Therefore, the Company restated the consolidated statement of income, the consolidated and company statements of changes in shareholders' equity and retained earnings, and the consolidated statement of cash flows for the period ended 31 March 2000 using the accounting for proportionate consolidation, for comparative purpose, to comply with the Thai Accounting Standard No. 46 - Financial Reporting of Interests in Joint Ventures. Central Pattana Public Company Limited Notes to the Interim Consolidated and Company Financial Statements (Unaudited) For the three-month periods ended 31 March 2001 and 2000 15 Related Party Transactions The following material transactions were carried out with related parties: a) Rental, services and management income For the three-month period ended Consolidated Company 31/3/44 2001 2000 2001 2000 Baht 000 Baht 000 Baht 000 Baht 000 Rental and service income Subsidiaries Central Realty Service Co., Ltd. - - 12,061 11,300 Central Food Avenue Co., Ltd. - - 5,723 8,742 Other subsidiaries - - 1,796 1,827 - - 19,580 21,869 Joint Ventures - - - - Related companies Central Department Store Group 14,532 18,273 8,091 11,067 Fast Food Group 5,808 12,184 4,308 7,566 Central Plaza Hotel Company Limited 2,519 2,475 2,519 2,475 Retail Group and others 39,009 29,805 16,214 17,171 61,868 62,737 31,132 38,279 61,868 62,737 50,712 60,148 Management fee Subsidiaries Central Realty Service Co., Ltd. - - 6,227 5,848 Others - - 7 8 - - 6,234 5,856 Joint Ventures Central Pattana Rama 3 Co., Ltd. - - 2,851 2,609 Central Realty Service Rama 3 Co., Ltd. - - 1,459 1,325 - - 4,310 3,934 Related companies Bangna Central Property Co., Ltd. 1,080 1,169 1,050 1,050 Others 485 45 484 45 1,565 1,214 1,534 1,095 1,565 1,214 12,078 10,885 Rental and service incomes were carried out on commercial terms and conditions and at market prices. Management fee were charged at negotiated prices. Central Pattana Public Company Limited Notes to the Interim Consolidated and Company Financial Statements (Unaudited) For the three-month periods ended 31 March 2001 and 2000 b) Cost of rental and services For the three-month period ended Consolidated Company 31/3/44 2001 2000 2001 2000 Baht 000 Baht 000 Baht 000 Baht 000 Cost of rental and services Subsidiaries - - - 614 Joint Ventures - - - - Related companies Central Department Store Group 3,755 3,803 3,746 3,771 Retails Group and others 2,710 2,986 2,717 2,731 Big C Super Center Group 490 404 2 4 6,955 7,193 6,465 7,120 Cost of rental and services were carried out on commercial terms and conditions and at market prices. c) Other income and other expense Consolidated 2001 2000 For the three-month period ended 31 March Baht 000 Baht 000 Related companies Interest income 9 6 Other income 2,302 2,171 Administrative expense 461 228 Company 2001 2000 Baht 000 Baht 000 Subsidiaries Interest income 5,818 7,386 Other income 3,018 1,579 Management fee 145 789 Interest expense 1,295 561 Related companies Interest income 9 2 Other income 2,258 2,169 Administrative expense 47 - Management and consultant fees were charged at agreed rates. Central Pattana Public Company Limited Notes to the Interim Consolidated and Company Financial Statements (Unaudited) For the three-month periods ended 31 March 2001 and 2000 d) Outstanding balances arising from rental, services and management fee Consolidated Company 31 March 31 December 31 March 31 December 2001 2000 2001 2000 Baht 000 Baht 000 Baht 000 Baht 000 Accounts receivable Subsidiaries Central Realty Service Co., Ltd. - - 5,424 5,571 Other subsidiaries - - 139 541 Joint Ventures Central Pattana Rama 3 Co., Ltd. 575 651 1,427 1,629 Central Realty Service Rama3 Co., Ltd. 381 499 942 1,226 Related companies Central Department Store Company Limited 13,527 9,713 11,751 8,808 Bangna Central Property Company Limited 4,066 4,968 1,828 2,762 Central Plaza Hotel Company Limited 4,178 1,352 4,178 1,352 Others 10,490 11,975 8,232 6,612 33,217 29,158 33,921 28,501 e) Short-term loan and advances to related parties Consolidated Company 31 March 31 December 31 March 31 December 2001 2000 2001 2000 Baht 000 Baht 000 Baht 000 Baht 000 Short-term loan to related parties Food Novelties Co., Ltd. - - - 19,550 Advances to related parties Rachada Nonsee Department Store Co., Ltd. 5,346 5,346 - - Bangna Central Property Co., Ltd. - 584 - - CRC A Hold Company Co., Ltd. - 812 - - Others 54 71 - - 5,400 6,813 - - 5,400 6,813 - 19,550