Central Pattana Public Company Limited Analysis of the company performance and financial position for Quarter 1/2004 OVERALL PERFORMANCE Q1/2004 Central Pattana Public Company Limited announced that its net income of Q1/2004 was 340.7 MB., increased Y-O-Y by 37.3 MB. or 12.3% mainly due to increase in rental and service income from consolidation of revenue of Central Airport Plaza Chiangmai Phase 2B and Central Rattanathibet Town Center, higher income from rental of common area, normal rental rate increase and lower administrative expenses. The company has continuously expanded its business since 2002. However, net interest bearing debt to equity ratio can be maintained less than1 time. In Q1/2004, net interest bearing debt to equity ratio was only 0.66 times. "Central Park" , a 40 rai park in Central Plaza Rama2, was opened on April 9, 2004. Moreover, Tops Supermarket was also opened in Central Rattanathibet Town Center to replace Jusco Supermarket on May 14, 2004. Revenues Total rental, service and food and beverage revenues of Q1/2004 amounted to 1,394.2 MB., increased by 137.7 MB. or 11% Y-O-Y. This was due to there have been revenue from Central Airport Plaza Chiangmai Phase 2B, opened in April 2003 and Central Rattanathibet Town Center, acquired in December 2003, included in this quarter. This was also resulted from normal rental rate increase and higher income from rental of common area, especially at Central World Plaza. Cost of goods sold and Selling&Administrative expenses Cost of goods sold of Q1/2004 was 758.9 MB., higher Y-O-Y by 109.4 MB or 16.8% due to cost of new projects, increase in electricity rate since February 2004, higher land rental cost of Central Plaza Lardprao, higher insurance cost, and repair & maintenance cost for building and system of Central World Plaza. Gross profit margin of Q1/2004 was 45.6%, decreased from 48.3% of Q1/2003 due to increase in cost as mentioned earlier. It is considered normal for the newly opening projects. It usually takes 2-3 years, that gross profit ratio shall be higher than 50%. Administrative expenses of Q1/2004 amounted to 168.4 MB., decreased Y-O-Y by 50.7 MB or 23.1%, mainly because last year there were a compensation of Lardprao to State Railway of Thailand and financial consultant fee for set up of property fund of Central City Bangna amounted to 45.7MB.and 20.7 MB. respectively. Financial Position Assets As at March 31, 2004, the consolidated assets were 26,816.6 MB, increased from December 31, 2003 by 3,266.7 MB. or 13.9 % mainly came from higher cash and cash equivalent by 3,020.1 MB. from issuance of unsecured bond amounted to 2,500 MB. during March 2004. As a result, current assets were higher by 3,111.3 MB. or 110.2%. Moreover there were capital expenditure in this quarter amounted to 409.2 MB., mainly came from renovation of system in Central World Plaza, construction of Central World Tower, and construction of Central Park in Central Plaza Rama2. Liabilities As at March 31, 2004, the consolidated liabilities were 18,519.0 MB, increased from December 31, 2003 by 2,924.8 MB. or 18.7% due to issuance of senior unsecured bond during March 2004 to finance a renovation of Central World Plaza and construction of Central World Tower. It comprised of tenor of 5 year for 1,000 MB. and 7 year for 1,500 MB. The company had also drawn down Project Financing loan of Central Airport Plaza Chiangmai Phase 2B amounted to 400 MB. in March 2004. Shareholder's Equity Shareholders' equity as at March 31, 2004 was 8,297.6 MB., higher than December 31, 2003 came from net income of Q1/2004 . Dividend payment from the net profit of 2003 at Baht 1.1 per share, 435,763,200 shares, total amount of 479,339,520 Baht on May 20, 2004 and the decrease of par value of the Company's share from 5 Baht per share to 1 Baht per share, which will be effective from May 17, 2004 onward, have already been approved by the shareholder meeting held on April 21, 2004. Financial Ratio Analysis Profitability Net profit margin of Q1/2004 was in line with last year although revenue increased from consolidation of revenue of Central Airport Plaza Chiangmai Phase2B and Rattanathibet Town Center. Cost of rental and service increased due to higher electricity cost, insurance premium, and repair & maintenance, which resulted in lower profit margin, ROA, and ROE in Q1/2004.This is due to higher investment in new projects especially Central World Plaza which have not fully generated revenue in 2004. This is considered normal for the newly opening projects. It usually takes 2-3 years until the gross profit margin ratio shall be higher than 50%. Liquidity and Financial Policy Interest coverage ratio of Q1/2004 was less than last year due to higher interest expense from drawn down of project financing loan of Central Airport Plaza Chiangmai Phase 2B and issuance of unsecured bond during March 2004. However net interest bearing debt to equity ratio was lower than last year due to capital increase during 2003 and higher cash flow from operation as mentioned earlier. As at March 31,2004, interest bearing debt comprised of 91% fixed interest rate and 9% floating interest rate. Key Ratio 31 Mar. 2003 31 Mar. 2004 LIQUIDITY RATIO Current Assets/Current Liabilities ( Times) 0.4 1.6 Accounts receivable turnover (Days) 7 6 PROFITABILITY RATIO Gross Profit Margin (%) 48.3% 45.6% Net Profit Margin (%) 23.1% 23.1% Return on Equity (%) 19.9% 17.2% EFFICIENCY RATIO Return on Assets (%) 5.56% 5.08% FINANCIAL POLICY RATIO Net interest bearing debt to equity (Times) 1.0 0.7 Interest coverage (Times) 8.1 7.5