SET Announcements

Related Transactions in Construction Trade 1. Subcontractors As at June 30,1999, the company had trade transactions with its related parties that the parent company has operated as their subcontractors as follows: Amounts : Thousand Baht Accounts Construction Advance Construction Receivable Contract in progress Received Income - Joint Venture BBCD Bilfinger and Berger Bauaktiengesellschaft, CH. Karnchang Public Co., Ltd. and Dyckerhoff & Widmann AG 409,070 - - - - Joint Venture BCKT (Bilfinger and Berger Bauaktiengesellschaft, CH. Karnchang Public Co., Ltd., Kumagai Gumi Co., Ltd., and Tokyu Construction Co., Ltd.) 85,700 7,239 36,280 454,679 - Joint Venture CH. Karnchang Public Co., Ltd., Bilfinger and Berger Bauaktiengesellschaft, Tokyu Construction Co., Ltd. and CH. Karnchang - Tokyu Construction Co., Ltd 546,717 881 14,578 273,973 Total 1,041,487 8,120 50,858 728,652 Since 1998, the parent company reduced value of the construction contract with Joint Venture BBCD as the result of its accrued payment to the company and their financial liquidity in order to maintain liquidity and reduce financial cost. The parent company still supports the joint venture for the construction supplies as usual. As at June 30, in the company's financial statements and consolidated financial statements, the said joint venture has debt balance with the parent company in the approximate amount of Baht 815.5 million and Baht 530 million in 1999, and in the approximate amount of Baht 853.1 million and Baht 554.5 million in 1998. 2. Purchases Supplies and Services for Construction Activities As at June 30, 1999 the Company had transactions with related companies which supply materials and other services for the company as follows: Amounts : Thousand Baht Bangkok Concrete Industries Company Limited 7,049 Mahasiri Company Limited 10,587 Hicrete Production and Technology Company Limited 4,992 Hitech Equipment and Transport Company Limited 6431 Subsidiaries and other related companies 1,246 Total 30,305 Other services 9,504 Other Trade Transactions 1. Other Accounts receivable related to construction activity Receivables included trade receivable from related parties which the parent company has supported for the construction supplies including rental equipment , project management, and transportation services which are as follows: Amounts : Thousand Baht Subsidiaries - Construction Material Supply Co.,Ltd. 129,349 - Other subsidiaries 3,368 Related Companies and Limited Partnership - Bangkok Concrete Industries Company Limited 23,513 - Other related companies 17,076 Joint Ventures - Joint Venture BBCD Bilfinger and Berger Bauaktiengesellschaft, CH. Karnchang Public Co., Ltd. and Dyckerhoff & Widmann AG 406,423 - Joint Venture BCKT (Bilfinger and Berger Bauaktiengesellschaft, CH. Karnchang Public Co., Ltd ., Kumagai Gumi Co., Ltd., and Tokyu Construction Co., Ltd.) 26,010 - Other joint ventures 3,786 Total 609,525 Construction Material Supply Co.,Ltd. The parent company sold construction supplies to a subsidiary company which has business in producing and distribution asphaltic, asphalt and other construction supplies such as stone, sand and cement with selling price plus operating expenses 3% of acquisition price. The subsidiary company leases rubber plant and concrete plant with the parent company with rental rate of Baht 2,013,000 per month. Bangkok Concrete Industries Company Limited The parent company has rental income and transportation income from the related company which has business in producing and selling pin piles for construction work of the company's project with charge rates equivalent to general market rate according to normal business. Joint Venture BBCD Bilfinger and Berger Bauaktiengesellschaft, CH. Karnchang Public Co., Ltd. and Dyckerhoff & Widmann AG The parent company has rental income and transportation income and asphalt and other construction supplies sale such as cement with the selling prices equivalent to general market prices according to normal business. Joint Venture BCKT (Bilfinger and Berger Bauaktiengesellschaft, CH. Karnchang Public Co., Ltd ., Kumagai Gumi Co., Ltd., and Tokyu Construction Co., Ltd.) The parent company has rental income and transportation income and partial asphaltic sale to the joint venture by selling to the joint venture with the selling prices equivalent to general market prices according to normal business. 2. Advance Payments Amounts : Thousand Baht The company had advance payments to subsidiary as follows: - Bangkok Metro Co., Ltd. 557 Total advance payments 557 3. Loans Disclosure of loans to and loans from subsidiaries, related companies and joint ventures. (Amounts : Thousand Baht) 1999 1998 Loan Policy of Related Parties Loans to Subsidiaries - CH. Karnchang Real Estate Co., Ltd. 500 400 Market borrowing at rate 9.50% up to 18.50% - Bangkok Metro Co., Ltd 78,528 - Market borrowing at rate 10.50% up to 18.25% Joint ventures - Joint Venture Phuket Consortium Consists of CH. Karnchang Public Co., Ltd., Thames Water International (Thailand) Co., Ltd., Index International Group Co., Ltd., Market borrowing and Trio Consultant Co., Ltd. 6,400 6,400 at rate 9.50% up to 19.50% - Joint Venture BCKT (Bilfinger and Berger Bauaktiengesellschaft, CH. Karnchang Public Co., Ltd., Kumagai Gumi Co., Ltd., and Market borrowing Tokyu Construction Co., Ltd.) 45,503 140,000 at rate 15% Related company Market borrowing at rate - Pathumthani Water Co., Ltd. 159,359 111,411 10.00% up to 16.375% Total 290,290 258,211 Loan from - Joint Ventures TWCK (Thames Water International (Thailand) Ltd. Market borrowing and CH. Karnchang Public Co., Ltd.) 40,000 - at rate 8.75% up to 15.50% Total 40,000 - As at June 30, 1999 and 1998, the Company had the interest receivable from loans to subsidiaries, related companies, and joint ventures in the approximate amount of Baht 34.1 million and Baht 34.6 million, respectively. And the Company had the interest payable from loans from joint ventures in the approximate amount of Baht 4.7 million in 1999. In the second quarter of 1999, the joint venture which the company has 25% of profit sharing had changed the deal of its construction contract of tunnel boring project from Rama IX station to Sirikit station as the contractor to subcontract to Kumagai Gumi Co., Ltd. to construct the said work according to the resolution of the joint venture' s board of directors meeting dated March 4, 1999 stated that its participants can be granted construction work by the joint venture under the existing budget of the project. The participant offered to subcontract the said work under the condition of the joint venture will charge all expenses involved to the said work. The subcontract pricing conditions are fixed lump sum in amount of Baht 660,792,262 and Yen 1,811,205,561 (excluding value added tax). The payment will be followed the schedule indicated in the contract. Eventually, the joint venture compensated all expenses involved the said work with its executed revenue from construction. NOTE 3 - BASIS OF CONSOLIDATED FINANCIAL STATEMENTS The consolidated financial statements of CH. Karnchang Public Co., Ltd., subsidiaries and joint ventures have been prepared in accordance with generally accepted accounting principles and Ministerial Regulations No.7 (1996) dated October 25, 1996. Joint ventures including in the consolidation by proportionate method are those having major responsibility and significant in success of result being responsible by CH. Karnachang Public Co., Ltd. and or it's subsidiaries. The consolidated financial statements for the 6 month periods ended June 30, 1999 and 1998 were consisted of the financial statements of CH. Karnchang Public Co., Ltd., subsidiaries and joint ventures by proportion of holding by the parent company as follows: Percentage Holding by Parent Company or Percentage of profit sharing in Joint Ventures Subsidiaries Construction Material Supply Co.,Ltd. 99.99% (in 1999) CH. Karnchang Realestate Co., Ltd. and Partnerships Limited 99.00% Bangkok Metro Co., Ltd. 79.94% CH. Karnchang-Tokyu Construction Co., Ltd. and Joint Ventures 55.00% Equity in Joint Ventures Joint Venture Phuket Consortium Consists of CH. Karnchang Public Co., Ltd., Thames Water International (Thailand) Co., Ltd, Index International Group Co., Ltd. and Trio Consultant Co., Ltd. 93.00% Joint Venture CH. Karnchang Public Co., Ltd., Tokyu Construction Co., Ltd. in joint venture with CH. Karnchang - Tokyu Construction Co., Ltd. - Highway Project 60.00% - Expressway Project 40.00% Percentage Holding by Parent Company or Percentage of profit sharing in Joint Ventures Joint Venture CH. Karnchang Public Co., Ltd., Bilfinger and Berger Bauaktiengesellschaft, Tokyu Construction Co., Ltd. and CH. Karnchang - Tokyu Construction Co., Ltd. - Second Stage Expressway Project Part B Route Phayathai - Bangkhlo 53.20% - Second Stage Expressway Project Part C+ Route Chaeng Watthana - Bang Phun and Bang Sai 59.99% - Second Stage Expressway Project Part D Route Asoke - Srinakarin 59.99% - Second Stage Expressway Project Part C1A Route Ngam Wong Wan - Chaeng Watthana 59.99% Joint Venture TWCK (Thames Water International (Thailand) Ltd. and CH. Karnchang Public Co., Ltd.) 50.00% Joint Venture BBCD (Bilfinger and Berger Bauaktiengesellschaft , CH. Karnchang Public Co., Ltd. and Dyckerhoff & Widmann AG) 35.00% Joint Venture BCKT (Bilfinger and Berger Bauaktiengesellschaft, CH. Karnchang Public Co., Ltd., Kumagai Gumi Co., Ltd., and Tokyu Construction Co., Ltd.) 25.00% Equity in Joint Ventures by the parent company Joint Venture Phuket Consortium Consists of CH. Karnchang Public Co., Ltd., Thames Water International (Thailand) Co., Ltd, Index International Group Co., Ltd. And Trio Consultant Co., Ltd. CH. Karnchang Public Co., Ltd. in joint venture with Thames Water International (Thailand) Co., Ltd. Index International Group Co., Ltd. and Trio Consultant Co., Ltd. made agreement with The Civil Department, the Ministry of Interior to design and construct drainage system and waste water treatment system for Phuket Municipality of Phuket Province as contract dated May 31, 1994, and sent the last invoice to employer in the second quarter 1997. Joint Venture CH. Karnchang Public Co., Ltd., Tokyu Construction Co., Ltd. in joint venture with CH. Karnchang - Tokyu Construction Co., Ltd. CH. Karnchang Public Co., Ltd. in joint venture with CH. Karnchang - Tokyu Construction Co., Ltd and Tokyu Construction Co.,Ltd. made agreement with - The Department of Highways to construct Bangkok - Chon Buri New Highway Project from Anuj to Klong Kalong as contract dated September 30, 1993, and Bangkok - Chonburi new highway Bang Bo Interchange and road to Highway No 34 as contract dated August 30, 1994. The Joint Venture has completed construction work, Bangkok - Chon Buri highway project from Anuj - Klong Kalong, and Bangkok Chonburi new highway, Bang Bo interchange project and road to highway No 34, and submitted to the employer in the forth quarter 1997 and the first quarter 1998, respectively. - The Expressway and Rapid Transit Authority of Thailand to construct Ramindra - Atnarong Expressway System and BMA'S Road : Lat Phrao Rd. - Soi Sukha as contract dated December 3, 1993, November 3 and 18, 1994. The Joint Venture has completed contraction work, Ramindra - Atnarong Expressway and BMA'S Road project; Lat Phrao Rd - Soi Sukha, and submitted to contractor in the third quarter 1996. The amount of completed construction is less than contract price which has already accepted by the employer. Joint Venture CH. Karnchang Public Co., Ltd., Bilfinger and Berger Bauaktiengesellschaft, Tokyu Construction Co., Ltd. And CH. Karnchang - Tokyu Construction Co., Ltd. CH. Karnchang Public Co., Ltd in joint venture with Bilfinger and Berger Bauaktiengesellschaft, Tokyu Construction Co., Ltd. and CH. Karnchang - Tokyu Construction Co., Ltd. made agreement with - Bangkok Expressway Public Co., Ltd. to construct Second Stage Expressway System Sector B, from Phayathai interchange to Bangkhlo as contract dated March 14, 1994, which has completed and submitted to the employer in the third quarter 1996. - Northern Bangkok Expressway Co., Ltd. to construct Second Stage Expressway Sector C+ Bang Pa-in to Pak Kret, Sector 1, from Chaeng Wattana to Bang Pun and Bang Sai as contract dated September 27, 1996, which the first stage had been completed and submitted in December 1998 and the second stage will be completed within November 30, 1999. - Bangkok Expressway Public Co., Ltd. to construct Second Stage Expressway System Sector D from Asoke - Srinakarin as contract dated April 17, 1997, .which the first stage had been completed and submitted in December 1998 and the second stage will be completed within April 21, 2000. - Bangkok Expressway Public Co., Ltd. to construct Second Stage Expressway System Sector C1A to expand lanes, from Ngam Wong Wan to Chaeng Wattana from a dual two - lane to dual three - lane carriageway as contract dated April 17, 1997. This project will be completed within April 21, 2000 Joint Venture TWCK (Thames Water International (Thailand) Ltd. And CH. Karnchang Public Co., Ltd.) CH. Karnchang Public Co., Ltd. in joint with Thames Water international (Thailand) Co., Ltd. have made agreement with Pathumthani Water Company Ltd. to construct water producing and distribution plant in the Pathumthani Province as contract dated November 21, 1995, which construction work plan is being completed and submitted within Febuary 1999. Joint Venture BBCD (Bilfinger and Berger Bauaktiengesellschaft , CH. Karnchang Public Co., Ltd. And Dyckerhoff & Widmann AG) CH. Karnchang Public Co., Ltd. in joint with Bilfinger and Berger Bauaktiengesellsehaft, and Dyckerhoff &Widmann AG to construct Bang na-Bang Pli - Bang Pakong Expressway Project as contract dated June 28, 1995. The project will be completed and submitted within January 2000. Joint Venture BCKT (Bilfinger and Berger Bauaktiengesellschaft, CH. Karnchang Public Co., Ltd., Kumagai Gumi Co., Ltd., and Tokyu Construction Co., Ltd.) CH. Karnchang Public Co., Ltd. in joint with Bilfinger and Berger Bauaktiengesellschaft, Kumagai Gumi Co., Ltd. and Tokyu Construction Co., Ltd. to construct of the initial underground transit section from Hua Lamphong to Bang-Su as contract dated November 5, 1996 and the project is scheduled to be completed within 260 weeks commencing the date of contract. (more)