SET Announcements

(Translation) No. CK-07-0000-PO-L-0055 February 21, 2007 Re: Notification of Impact from the Supreme Court Judgment Attn.: President of the Stock Exchange of Thailand Reference is made to the fact that CH. Karnchang Public Company Limited held the Board of Directors Meeting No. 2/2007 on February 20, 2007 at 4:30 p.m. at the Conference Room on the 21st Floor, No. 587 Viriyathavorn Building, Sutthisarn Road, Dindaeng Subdistrict, Dindaeng District, Bangkok. The Board of Directors Meeting resolved to consider and acknowledge impact which would be caused to the financial statements of CH. Karnchang Public Company Limited due to the Supreme Court's judgment reversing the Civil Court of Southern Bangkok's judgment which enforced the arbitral award requiring the Expressway and Rapid Transit Authority of Thailand to make payments to the Joint Venture BBCD (Bilfinger + Berger Bauaktiengesellschaft; CH. Karnchang Public Company Limited; and Dyckerhoff & Widmann AG). Given that the shareholding ratio of CH. Karnchang Public Company Limited in the said Joint Venture represents 35 percent, thus, the details of the possible impact on the financial statements of CH. Karnchang Public Company Limited for the year ended December 31, 2006 would be as follows: The balance sheet in the consolidated financial statements of CH. Karnchang Public Company Limited would present the provision for bad debt for accounts receivable - claim for increased costs in the entire amount of Baht 2,515,620,262.28, while the Company's individual financial statements would present the provision for loss on investments in joint ventures in the amount of Baht 2,508,249,686.72. The income statement in the consolidated financial statements of CH. Karnchang Public Company Limited, in respect of expenses, would present the provision for bad debt for accounts receivable - claim for increased costs in the entire amount of Baht 2,508,249,686.72, resulting in a decrease in the shareholders'equity. As for the Company's individual financial statements, sharing of loss from investments under equity method in joint ventures would amount to Baht 2,508,249,686.72. In this respect, the joint venture partners, and concurrently lenders of the said Joint Venture, mutually resolved to waive interest on loans provided by all joint venture partners, but the right to charge interest would remain unaffected should such compensation for the increased costs be received from the employer, failing which, no interest would be charged. Consequently, the details of the possible impact on the financial statements of CH. Karnchang Public Company Limited for the year ended December 31, 2006 would be as follows: In the balance sheet in the consolidated financial statements of CH. Karnchang Public Company Limited, the accrued interest payable would be reversed in the amount of Baht 442,839,502.33 and the accrued interest receivable would be reversed in the amount of Baht 13,364,146.92. As for the Company's individual financial statements, the accrued interest receivable would be reversed in the amount of Baht 20,560,226.03. The income statement in the consolidated financial statements of CH. Karnchang Public Company Limited, in respect of revenue, would present the reversal of accrued interest payable in the amount of Baht 442,839,502.33, and, as for expenses, would present the write-off of accrued interest receivable in the amount of Baht 13,364,146.92. As for the Company's individual financial statements, profit sharing under equity method would increase by Baht 442,839,502.33, and expenses would present the write-off of accrued interest receivable in the amount of Baht 20,560,226.03, thereby causing an increase in the shareholders' equity. Furthermore, such impact would not cause the net debt to equity ratio under the conditions of the debentures to exceed 2.5:1. However, the management is currently reviewing the details of the said judgment by the Supreme Court and is of the initial view that the Supreme Court's judgment refusing to enforce the arbitral award, reasoning that the Contract for the Design and Construction in question between the Expressway and Rapid Transit Authority of Thailand and the Joint Venture BBCD has no binding effect, does not affect the Joint Venture BBCD's legal right to claim for the increased costs (the increased Fixed Cost) of Baht 6,039,893,254, including interest at the rate of 7.5 percent per annum. Please be informed accordingly. Very truly yours, - Signature - (Mr. Anukool Tuntimas) Executive Vice President Human Resource and General Administration