SET Announcements

Consolidated CH. Karnchang Public Co., Ltd. Amounts : Thousand Baht 1999 1998 1999 1998 CASH FLOWS FROM INVESTING ACTIVITIES Dividend received - - 16,500 - Profit sharing from joint venture - - 40,000 17,200 Sales of investments in marketable securities - 42,000 - 42,000 Purchases of fixed assets (1,308) - (2,831) (2,746) Sales of fixed assets 13,246 769 27 32 Decrease (Increase) in short term investment 13,879 (9,538) (6) 14,884 Decrease (Increase) in notes receivable - financial companies - - - - Purchases in investment in subsidiary companies - - - - Net Cash provided by Investing Activities 25,817 33,231 53,690 71,370 CASH FLOWS FROM FINANCING ACTIVITIES Decrease in long-term loans (949,995) (199,806) (770,025) (128,337) Increase (Decrease) in bank overdrafts and loans from banks 9,101 101,296 (1,633) 87,460 Increase (Decrease) in notes payable - financial companies - - - - Increase in liabilities under discounted notes receivable 523,569 580,601 - - - Net Cash Provided by (Used in) Financing Activities (417,325) 482,091 (771,658) (40,877) Effect from exchange rate in cash and cash equivalent 28,938 (785) - - NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENT (829,580) 300,447 (570,411) 564,572 Cash and equivalent transaction-beginning balance 5,386,338 5,092,388 2,288,483 1,148,058 Cash and equivalent transaction-ending balance 4,556,758 5,392,835 1,718,072 1,712,630 SUPPLEMENT DISCLOSURES OF CASH FLOWS INFORMATION Interest expenses 151,857 406,897 88,094 164,964 Income taxes and withholding taxes 55,505 87,808 20,400 26,526 Cash and equivalent transaction-ending balance Cash on hand and unpledged cash at banks 4,295,279 5,062,982 1,718,072 1,712,630 Short term deposits 261,479 329,853 - - 4,556,758 5,392,835 1,718,072 1,712,630 See notes to financial statements CH. KARNCHANG PUBLIC COMPANY LIMITED, SUBSIDIARIES AND JOINT VENTURES STATEMENTS OF CASH FLOWS FOR THE NINE-MONTH PERIOD ENDED SEPTEMBER 30, 1999 AND 1998 (UNAUDITED) Consolidated CH. Karnchang Public Co., Ltd. Amounts : Thousand Baht 1999 1998 1999 1998 CASH FLOWS FROM OPERATING ACTIVITIES Net profit (loss) (1,016,510) 178,707 (1,016,510) 178,707 Adjustments to reconcile net profit(loss) by net cash provided by (used in) operating activities Depreciation and amortization 546,324 546,438 96,550 105,624 Amortization deferred expense 398,417 293,698 20,832 8,890 Write off prepaid withholding tax - 11,784 - 4,678 Allowance for doubtful accounts 5,090 - - - Increase (decrease) in allowance for decline in value of marketable securities (17) (213) (17) (213) Loss (Gain) from sale of equipment 11,505 (492) (7,693) (1,744) Loss (Gain) from unrealized exchange rate 180,977 (239,758) 6,419 - Gain from sale of investment in marketable securities (654) (10,859) (654) (10,859) Allowance for decline in value of long-term investment - 27,291 - 27,291 Share of net profit(loss) by equity method - - 1,075,053 (234,362) Change in Net Assets and Liabilities Decrease in accounts receivable 902,216 165,036 239,962 158,902 Decrease (Increase) in accounts receivable and loan to related companies and joint ventures 11,822 (337,475) (47,480) (80,524) Decrease (Increase) in construction contract in progress (139,149) (1,148,733) 343,587 57,257 Decrease in supplies for construction and construction in progress 341,055 5,813 12,804 39,037 Decrease in advance payments to subcontractors 97,016 175,638 7,227 30,592 Decrease (Increase) in other current assets 63,644 (15,861) 57,545 59,015 Increase in other assets (249,291) (577,269) (84,659) (54,219) Increase (Decrease) in accounts and notes payable (627,185) 226,638 (144,761) 557,389 Increase (Decrease) in accounts payable and loan from related companies (115,387) 620,736 (33,527) 38,925 Increase (Decrease) in advance received from employer and deferred construction revenue (210,886) 25,550 48,513 (152,491) Decrease in other current liabilities (137,165) (39,055) (79,570) (74,114) Increase in minority interest in subsidiaries 3,937 35,255 - - Net Cash Provided by (Used in) Operating Activities 65,759 (57,131) 493,621 657,781 See notes to financial statements Consolidated CH. Karnchang Public Co., Ltd. Amounts : Thousand Baht 1999 1998 1999 1998 CASH FLOWS FROM INVESTING ACTIVITIES Dividend received - - 16,500 - Profit sharing from joint venture - - 127,984 179,600 Sales of investments in marketable securities 4,354 342,159 4,354 342,159 Purchases of land and fixed assets (135,860) (159,209) (5,603) (9,667) Sales of fixed assets 82,202 22,143 15,073 13,550 Decrease (Increase) in short term investment (15,502) (20,435) (22) 2,065 Decrease in notes receivable - financial companies 42,117 37,206 - - Purchases in investment in subsidiary and related companies (15,848) (46,511) (30,848) (47,309) Net Cash provided by (used in) Investing Activities (38,537) 175,353 127,438 480,398 CASH FLOWS FROM FINANCING ACTIVITIES Decrease in long-term loans (1,631,980) (349,144) (898,363) (256,675) Increase (Decrease) in bank overdrafts and loans from banks (37,513) 504,017 53,086 413,249 Increase (Decrease) in notes payable - financial companies - (200,000) - (200,000) Increase in liabilities under discounted notes receivable 924,084 1,411,953 - - Net Cash Provided by (used in) Financing Activities (745,409) 1,366,826 (845,277) (43,426) Effect from exchange rate in cash and cash equivalent 28,938 (785) - - NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENT (689,249) 1,484,263 (224,218) 1,094,753 Cash and equivalent transaction-beginning balance 5,246,007 3,908,572 1,942,290 617,877 Cash and equivalent transaction-ending balance 4,556,758 5,392,835 1,718,072 1,712,630 SUPPLEMENT DISCLOSURES OF CASH FLOWS INFORMATION Interest expenses 569,618 1,082,274 234,219 382,861 Income taxes and withholding taxes 198,352 303,390 62,435 65,142 Cash and equivalent transaction-ending balance Cash on hand and unpledged cash at banks 4,295,279 5,062,982 1,718,072 1,712,630 Short term deposits 261,479 329,853 - - 4,556,758 5,392,835 1,718,072 1,712,630 See notes to financial statements CH. KARNCHANG PUBLIC CO., LTD, SUBSIDIARIES AND JOINT VENTURES NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 1999 AND 1998 (UNAUDITED) NOTE 1 - ECONOMIC ENVIRONMENT AND BASIC OF PRESENTATION Since the second half of 1997 until the present certain Asia Pacific countries, including Thailand, are experiencing economic difficulties relating to currency devaluation and slowdown in growth. Accordingly, the Thai government sought assistance from the International Monetary Fund to alleviate the economic crisis and improve the economic over time. The financial statements reflect the assessment of the possible impact of this economic situation on the financial position of CH. Karnchang Public Co., Ltd., subsidiaries and joint ventures. The ultimate effect on the entitys financial position of these uncertainties can not presently be determined. NOTE 2 - TRANSACTIONS WITH RELATED PARTIES The company has had significant transactions with its related parties. The financial statements reflect the effects of these transactions on the normal business basis agreed upon by the companies concerned. The transactions with its related parties have included transactions with companys joint ventures where by there will be no settlement until the end of the project. Financial statements for the nine-month period ended September 30 include the significant transactions between related parties as follows: (Amounts : Thousand Baht) Consolidated CH. Karnchang Public Co.,Ltd. 1999 1998 1999 1998 Related Related Total Subsidiaries Related Related Total Balance Sheets Companies Joint Venture Companies Joint Ventures Accounts receivable and construction contract in progress 391,382 442,384 833,766 895,203 - - 859,378 859,378 1,264,707 Accounts receivable and loans 292,803 303,793 596,596 638,135 207,180 197,046 456,126 860,352 871,346 Advances payment to subcontractors 74,539 - 74,539 190,150 - - - - Accrued income and other current assets 29,996 5,584 35,580 9,095 7,697 25,247 9,112 42,056 6,052 Investments 2,105,458 10,502 2,115,960 2,543,527 566,831 1,931,150 912,536 3,410,517 3,888,668 Accounts payable - trade 67,462 - 67,462 592,190 7,579 31,359 - 38,938 53,496 Other payables and loans 1,273,793 222 1,274,015 1,501,959 7,277 787 488 8,552 41,712 Advances received from contractor and deferred construction revenues 615,794 25,447 641,241 1,072,810 - - 41,645 41,645 12,115 Retention and other current liabilities 21,893 2,644 24,537 26,862 - - 5,287 5,287 1,461 Other liabilities - - - - 16,852 - 2,328,519 2,345,371 852,666 Income Statements Construction activities income 2,105,412 634,124 2,739,536 4,355,712 - - 986,906 986,906 1,506,988 Sale construction material income 1,428 159,075 160,503 347,001 222,450 1,260 247,268 470,978 514,489 Management income 17,899 32,952 50,851 19,619 7,809 17,350 45,462 70,621 117,346 Rental income 14,425 13,039 27,464 30,948 21,839 11,045 23,090 55,974 92,910 Transportation income 33,083 461 33,544 40,210 1,496 32,732 1,120 35,348 41,428 Interest income 14,642 3,865 18,507 9,291 6,460 11,671 5,615 23,746 24,210 Share of net profit by equity method - - - - 90,336 - (1,165,389) (1,075,053) 234,362 Dividend and profit sharing - - - - 16,500 - 127,984 144,484 184,600 Other incomes 10,574 174 10,748 44,412 17,307 3,386 2,183 22,876 16,900 Cost of construction activities and cost of goods sold 1,073,811 - 1,073,811 1,574,437 25,294 - 1,487 26,781 563,246 Administrative expense and interest expense 97,192 1,665 98,857 91,605 651 - 2,574 3,225 3,690 Related Transactions in Construction Trade 1. Subcontractors As at September 30, the company had trade transactions with its related parties that the parent company has operated as their subcontractors as follows: Amounts : Thousand Baht 1999 1998 Accounts Construction Advance Construction Accounts Construction Advance Construction Receivable Contract in progress Received Income Receivable Contract in progress Received Income - Joint Venture BBCD Bilfinger and Berger Bauaktiengesellschaft, CH. Karnchang Public Co., Ltd. and Dyckerhoff & Widmann AG 274,223 - - - 432,238 - - - - Joint Venture BCKT (Bilfinger and Berger Bauaktiengesellschaft, CH. Karnchang Public Co., Ltd., Kumagai Gumi Co., Ltd., and Tokyu Construction Co., Ltd.) 81,629 4,110 25,105 683,805 77,602 56,545 - 609,428 - Joint Venture CH. Karnchang Public Co., Ltd., Bilfinger and Berger Bauaktiengesellschaft, Tokyu Construction Co., Ltd. and CH. Karnchang - Tokyu Construction Co.,Ltd. 499,416 - 16,540 303,101 662,095 36,227 - 897,560 Total 855,268 4,110 41,645 986,906 1,171,935 92,772 - 1,506,988 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 September 30, in the companys financial statements and consolidated financial statements, the said joint venture has debt balance with the parent company in the approximate amount of Baht 672.1 million and Baht 436.9 million in 1999, and in the approximate amount of Baht 875.9 million and Baht 569.3 million in 1998. 2. Purchases Supplies and Services for Construction Activities As at September 30, the Company had transactions with related companies which supply materials and other services for the company as follows: Amounts : Thousand Baht 1999 1998 Subsidiary - Construction Material Supply Company Limited 7,579 - Total 7,579 - Related Companies - Bangkok Concrete Industries Company Limited 7,053 29,214 - Mahasiri Company Limited 8,905 22,194 - Hicrete Production and Technology Company Limited 3,463 - - Hitech Equipment and Transport Company Limited 11,717 - - Subsidiaries and other related companies 221 2,088 Total 31,359 53,496 Other services 8,552 1,712 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 1999 1998 Subsidiaries - Construction Material Supply Company Limited. 100,259 - - Other subsidiaries 512 512 Related Companies - Bangkok Concrete Industries Company Limited 15,062 36,573 - Other related companies 22,625 40,673 Joint Ventures - Joint Venture BBCD Bilfinger and Berger Bauaktiengesellschaft, CH. Karnchang Public Co., Ltd. and Dyckerhoff & Widmann AG 397,855 443,636 - Joint Venture BCKT (Bilfinger and Berger Bauaktiengesellschaft, CH. Karnchang Public Co., Ltd., Kumagai Gumi Co.,Ltd. and Tokyu Construction Co., Ltd.) 3,950 66,748 - Other joint ventures 2,418 27,428 Total 542,681 615,570 Construction Material Supply Company Limited 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 rental rate of Baht 2,013,000 per month. - Cars and heavy construction tools with rental rate of Baht 1,350,000 per month. - Land with rental rate of Baht 250,000 per month. - Office building with rental rate of Baht 150,000 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 companys projects 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. Amounts : Thousand Baht 1999 1998 2. Advance Payments The company had advance payments to subsidiaries as follows: Subsidiaries - Bangkok Metro Company Limited 2,781 48,448 - Other subsidiaries and related parties - 1,587 Total advance payments 2,781 50,035 3. Loans Disclosure of loans to subsidiaries, related companies and joint ventures. (Amounts : Thousand Baht) 1999 1998 Loan Policy of Related Parties Loans to Subsidiaries - CH. Karnchang Real Estate Company Limited - 400 Market borrowing at rate 9.50% up to 18.50% - Bangkok Metro Company Limited 103,628 12,397 Market borrowing at rate 10.50% up to 18.25% (Amounts : Thousand Baht) 1999 1998 Loan Policy of Related Parties 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 18.50% - 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 45,503 at rate 15% Related company Market borrowing at rate - Pathumthani Water Company Limited 159,359 141,041 9.25% up to 16.375% Total 314,890 205,741 As at September 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 42.1 million and Baht 10.1 million, respectively. And the Company had the interest payable from loans from joint ventures in the approximate amount of Baht 5.3 million and Baht 1.5 million, respectively. 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 by subcontracting the part of work to Kumagai Gumi Co., Ltd. to construct the said work according to the resolution of the joint ventures 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. NOTE 3 - BASIS OF CONSOLIDATED FINANCIAL STATEMENTS The consolidated financial statements of CH. Karnchang Public Co., Ltd., subsidiaries and joint ventures have (more)