FINANCIAL STATEMENTS QUARTER 2/2000

15 สิงหาคม 2543
HAAD THIP PUBLIC COMPANY LIMITED INTERIM FINANCIAL STATEMENTS FOR THE PERIODS ENDED JUNE 30, 2000 AND REVIEW REPORT OF CERTIFIED PUBLIC ACCOUNTANT EXPRESSED IN Thai Baht REVIEW REPORT OF CERTIFIED PUBLIC ACCOUNTANT To The Board of Directors of Haad Thip Public Company Limited I have reviewed the balance sheet of Haad Thip Public Company Limited as at June 30, 2000,and the related statements of income for the three-month and six-month periods ended June 30,2000,the statements of changes in shareholders'equity,retained earnings and cash flows for the six-month period ended June 30,2000. These financial statements are the responsibility of the Company's management as to their correctness and completeness of the presentation. My responsibility is to issue a report on these financial statements based on my review. The interim financial statements of Haad Thip Public Company Limited for the three-month and six-month periods ended June 30, 1999, which are presented for comparative purposes, were reviewed by Mr.Prasit Musikabhantu, who at that time was an auditor in my firm. I conducted my review in accordance with the auditing standard applicable to review engagements. This standard requires that I plan and perform the review to obtain moderate assurance as to whether the financial statements are free of material misstatements. A review is limited primarily to inquiries of company personnel and analytical procedures applied to financial data and thus provides less assurance than an audit in accordance with generally accepted auditing standards. Accordingly, I do not express an audit opinion. Based on my review, nothing has come to my attention that causes me to believe that the financial statements referred to above are not presented fairly, in all material respects, in accordance with generally accepted accounting principles. I have previously audited the financial statements of Haad Thip Public Company Limited for the year ended December 31, 1999 in accordance with generally accepted auditing standards and issued my report dated February 10, 2000, expressing an unqualified opinion on those financial statements. The balance sheet as at December 31,1999,presented herein for comparative purposes,is a part of such audited financial statements. I have not performed any auditing procedures subsequent to my report date. As discussed in Note 4 to the interim financial statements, the Company changed the method of recording of land from cost method to appraisal method in the second quarter of 2000. VICHIEN THAMTRAKUL C.P.A.(THAILAND) Registration No. 3183 Bangkok July 28, 2000 HAAD THIP PUBLIC COMPANY LIMITED BALANCE SHEETS JUNE 30, 2000 AND DECEMBER 31, 1999 A S S E T S In Thousand Baht June 30, December 31, 2000 1999 "Unaudited" "Reviewed" "Audited" CURRENT ASSETS Cash on hand and in banks 26,148 16,134 Accounts and notes receivable - trade (Note 3) 60,955 71,183 Less allowance for doubtful accounts ( 2,631) ( 2,680) Accounts and notes receivable - trade - net 58,324 68,503 Inventories - net 59,414 60,210 Other current assets Claim and other receivables - net 2,134 25,088 Prepaid expenses 11,989 5,849 Others 174 671 Total other current assets 14,297 31,608 Total Current Assets 158,183 176,455 ADVANCES AND LOANS TO DIRECTORS AND EMPLOYEES 2,123 1,902 INVESTMENT IN SHARES - Net 2,840 2,840 PROPERTY, PLANT AND EQUIPMENT - net of accumulated depreciation (Notes 4, 5, 6 and 9) 741,409 548,612 OTHER ASSETS Land not used in operations - At appraisal value (Note 4) 73,821 60,232 Assets under development for future project 9,609 9,587 Refundable deposits and others 2,486 2,599 Total Other Assets 85,916 72,418 TOTAL ASSETS 990,471 802,227 See accompanying Notes to Interim Financial Statements. HAAD THIP PUBLIC COMPANY LIMITED BALANCE SHEETS JUNE 30, 2000 AND DECEMBER 31, 1999 LIABILITIES AND SHAREHOLDERS' EQUITY In Thousand Baht June 30, December 31, 2000 1999 "Unaudited" "Reviewed" "Audited" CURRENT LIABILITIES Bank overdraft and loans from financial institutions (Note 5) 25,000 64,872 Accounts payable - trade 47,260 93,440 Current portion of long-term loan (Note 6) 13,533 1,495 Other current liabilities Accounts payable - others 15,854 10,713 Dividend payable (Note 7) - 16,602 Income tax payable 18,366 20,148 Others 14,674 11,228 Total other current liabilities 48,894 58,691 Total Current Liabilities 134,687 218,498 DEPOSITS RECEIVED FROM CUSTOMERS AND OTHERS 139,783 143,198 LONG-TERM LOANS - Net of Current Portion (Note 6) 30,003 5,780 Total Liabilities 304,473 367,476 SHAREHOLDERS' EQUITY Share capital Authorized - 25,000,000 shares; Baht 10 par value 250,000 250,000 Issued and fully paid up - 16,601,500 shares 166,015 166,015 Premium on share capital 154,728 154,728 Retained earnings Appropriated (Note 7) Legal reserve 16,457 16,457 General reserve 19,000 19,000 Unappropriated 101,462 78,551 Revaluation surplus on land (Note 4) 228,336 - Total Shareholders' Equity 685,998 434,751 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 990,471 802,227 See accompanying Notes to Interim Financial Statements. "UNAUDITED" "REVIEWED" HAAD THIP PUBLIC COMPANY LIMITED STATEMENTS OF INCOME FOR THE THREE-MONTH AND SIX-MONTH PERIODS ENDED JUNE 30, 2000 AND 1999 In Thousand Baht Three-Month Periods Six-Month Periods Ended June 30 Ended June 30 2000 1999 2000 1999 REVENUES Net sales 341,903 311,047 715,042 636,691 Other income Reversal of unclaimed customers' deposits 3,183 4,463 6,366 8,926 Others 1,773 1,595 2,897 3,078 Total Revenues 346,859 317,105 724,305 648,695 COSTS AND EXPENSES Cost of sales 233,958 211,028 497,835 439,153 Selling and administrative expenses (Note 4) 83,543 91,603 166,544 179,956 Interest expense 1,099 1,427 2,084 2,746 Directors' remuneration - - - 200 Total Costs and Expenses 318,600 304,058 666,463 622,055 INCOME BEFORE INCOME TAX 28,259 13,047 57,842 26,640 INCOME TAX ( 9,356) ( 3,726) ( 18,330) ( 8,077) NET INCOME 18,903 9,321 39,512 18,563 Earnings per Share (Baht) 1.14 0.56 2.38 1.12 See accompanying Notes to Interim Financial Statements. "UNAUDITED" "REVIEWED" HAAD THIP PUBLIC COMPANY LIMITED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY FOR THE SIX-MONTH PERIODS ENDED JUNE 30, 2000 AND 1999 In Thousand Baht 2000 1999 SHARE CAPITAL Common shares Balance, beginning of period 166,015 166,015 Increase during the period - - Balance, end of period 166,015 166,015 PREMIUM ON SHARE CAPITAL Balance, beginning of period 154,728 154,728 Increase during the period - - Balance, end of period 154,728 154,728 RETAINED EARNINGS Appropriated Legal reserve Balance, beginning of period 16,457 14,707 Increase during the period - - Balance, end of period 16,457 14,707 General reserve Balance, beginning of period 19,000 16,000 Increase during the period (Note 7) - 3,000 Balance, end of period 19,000 19,000 Unappropriated Balance, beginning of period 78,551 81,489 Increase during the period 39,512 18,563 Decrease during the period (Note 7) ( 16,601) ( 19,602) Balance, end of period 101,462 80,450 REVALUATION SURPLUS ON LAND (Note 4) Balance, beginning of period - - Increase during the period 228,336 - Balance, end of period 228,336 - TOTAL SHAREHOLDERS' EQUITY 685,998 434,900 See accompanying Notes to Interim Financial Statements. "UNAUDITED" "REVIEWED" HAAD THIP PUBLIC COMPANY LIMITED STATEMENTS OF RETAINED EARNINGS FOR THE SIX-MONTH PERIODS ENDED JUNE 30, 2000 AND 1999 In Thousand Baht 2000 1999 UNAPPROPRIATED RETAINED EARNINGS: Beginning of period 78,551 81,489 Less appropriation of net income for previous period (Note 7) General reserve - ( 3,000) Dividend ( 16,601) ( 16,602) Net income for the period 39,512 18,563 Total Unappropriated Retained Earnings 101,462 80,450 APPROPRIATED RETAINED EARNINGS: (Note 7) Legal reserve 16,457 14,707 General reserve 19,000 19,000 Total Appropriated Retained Earnings 35,457 33,707 TOTAL RETAINED EARNINGS 136,919 114,157 See accompanying Notes to Interim Financial Statements. "UNAUDITED" "REVIEWED" HAAD THIP PUBLIC COMPANY LIMITED STATEMENTS OF CASH FLOWS FOR THE SIX-MONTH PERIOD ENDED JUNE 30, 2000 AND 1999 In Thousand Baht 2000 1999 CASH FLOWS FROM OPERATING ACTIVITIES: Net income 39,512 18,563 Reconciliation of net income to net cash provided by (used in) operating activities: Bad debts expense and provision (reversal of provision) for doubtful accounts ( 49) 224 Provision (reversal of provision) for obsolete inventories 423 ( 181) Reversal of provision for impairment of land not used in operations ( 500) - Reversal of provision for decline in value of investment ( 1,140) - Loss on sales of investment in shares 1,129 - Loss on revaluation of land 4,418 - Depreciation and amortization 25,927 38,047 Gain on sales of fixed assets ( 209) ( 213) Amortization of promotion materials and book value of containers written off 14,497 12,727 Reversal of unclaimed customers' deposits ( 6,365) ( 8,926) Net cash provided by operating activities before changes in operational assets and liabilities 77,643 60,241 Decrease (increase) in operational assets Accounts and notes receivable - trade 10,228 17,977 Inventories 373 3,227 Claim and other receivables 22,954 9,294 Prepaid expenses ( 6,140) ( 3,200) Other current assets 497 ( 63) Assets under development for future project ( 22) - Refundable deposits and others ( 161) ( 164) "UNAUDITED" "REVIEWED" - 2 - In Thousand Baht 2000 1999 Increase (decrease) in operational liabilities Accounts payable - trade ( 46,180) ( 10,267) Accounts payable - others 5,140 ( 81) Accrued bonus - ( 5,704) Income tax payable ( 1,782) ( 19,964) Other current liabilities 3,446 ( 711) Customers' deposits and others 2,951 ( 6,909) Net Cash Provided by Operating Activities 68,947 43,676 CASH FLOWS FROM INVESTING ACTIVITIES: Increase in property, plant and equipment ( 22,210) ( 34,628) Proceeds from sales of fixed assets 301 284 Proceeds from sales of investment 11 - Net Cash Used in Investing Activities ( 21,898) ( 34,344) CASH FLOWS FROM FINANCING ACTIVITIES: Increase in advances and loans to directors and employees ( 221) ( 670) Increase (decrease) in loans from banks ( 20,000) 25,000 Increase in long - term loan 36,260 - Payment of dividends ( 33,202) ( 16,602) Net Cash Provided by (Used in) Financing Activities ( 17,163) 7,728 NET INCREASE IN CASH AND CASH EQUIVALENTS 29,886 17,060 - 3 - In Thousand Baht 2000 1999 Cash and Cash Equivalents,Beginning of Period ( 3,738) 6,193 CASH AND CASH EQUIVALENTS,END OF PERIOD 26,148 23,253 ADDITIONAL INFORMATION FOR CASH FLOWS: 1. Cash and Cash Equivalents consisted of: Cash on hand and in banks 26,148 23,792 Bank overdraft - ( 539) Net 26,148 23,253 2. Cash Paid During the Period for: Interest expense 2,176 4,324 Income tax 20,109 28,041 See accompanying Notes to Interim Financial Statements. HAAD THIP PUBLIC COMPANY LIMITED NOTES TO INTERIM FINANCIAL STATEMENTS JUNE 30, 2000 AND 1999 (REVIEWED) AND DECEMBER 31, 1999 (AUDITED) 1. BASIS FOR INTERIM FINANCIAL STATEMENTS The accompanying interim financial statements have been prepared in accordance with the Accounting Standard No.41 "The Interim Financial Statements" and the announcements of the Stock Exchange of Thailand. The accompanying interim financial statements have been prepared to provide an update on the latest complete set of annual financial statements by focusing on new activities, events and circumstances and does not duplicate information previously reported. Accordingly, the accompanying interim financial statements should be read in conjunction with the financial statements for the year ended December 31, 1999. The Company maintains its official accounting records in Thai Baht and prepares its interim financial statements in the Thai language in conformity with financial accounting standards in Thailand, which may not conform with generally accepted accounting principles in other countries. The accompanying financial statements are not intended to present the financial position and results of operations and cash flows in accordance with accounting principles and practices generally accepted in countries and jurisdictions other than Thailand. Accordingly, these financial statements are not designed for those who are not informed about Thai accounting principles and practices. For the convenience of the reader, an English translation of interim financial statements has been prepared from the interim Thai language financial statements which are issued for domestic reporting purposes. 2. SIGNIFICANT ACCOUNTING POLICIES The accompanying interim financial statements have been prepared in accordance with the accounting standards issued by the Institute of Certified Accountants and Auditors of Thailand. The significant accounting policies applied by the Company for the preparation of the accompanying interim financial statements are the same as those adopted in the preparation of the Company's financial statements for the year ended December 31, 1999. The new accounting policy applied by the Company during the quarter ended June 30, 2000 is as follow: Valuation of Land During the second quarter of 2000, the Company recorded its land at appraisal value which were appraised by an independent appraiser (see Note 4). The Company has a policy to appraise the land whenever the fair value of the appraised land materially change from the accounting value. - 2 - 3. ACCOUNTS AND NOTES RECEIVABLE - Trade Long-outstanding balances of the accounts and notes receivable as at June 30, 2000 were as follows: Amount (In Million Baht) Over 3 months to 6 months 3.6 Over 6 months to 12 months 0.5 Over 12 months 3.1 Total 7.2 As at June 30, 2000, the Company provided allowance for doubtful accounts equal to the estimated losses that may be incurred in the collection of receivables (which are based on a review of the current status of the existing receivables) amounting to approximately Baht 2.6 million. 4. LAND APPRAISAL During the second quarter of 2000, the Company engaged an independent appraiser to appraise all of its land as at May 31, 2000, by applying fair market value as shown in the appraiser's report in various dates in February and June , 2000. The revaluation surplus of land amounting to Baht 228 million was recorded in "Revaluation surplus on land" account under "Shareholders' Equity" in the balance sheet. The revaluation surplus of land is not available for dividend distribution. In addition, the Company recorded the devaluation of land for those which the fair market value were lower than the net carrying value amounting to (more)