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Net profit (loss) before minority interest and extraordinary items (298,262) (169,576) 120,608 (193,828) Add minority interest in net loss 227 - - - Net profit (loss) before extraordinary items (298,035) (169,576) 120,608 (193,828) Extraordinary items - Gain (loss) on settlement of debts 638,422 (238,463) 219,779 (214,211) Net profit (loss) 340,387 (408,039) 340,387 (408,039) Basic earnings (loss) per share (Baht) (Note 4) Basic earnings (loss) before extraordinary items (1.12) (1.83) 0.46 (2.09) Extraordinary items 2.41 (2.56) 0.83 (2.30) Basic earnings (loss) per share 1.29 (4.39) 1.29 (4.39) See notes to financial statements SANSIRI PUBLIC COMPANY LIMITED AND SUBSIDIARIES STATEMENTS OF CHANGE IN SHAREHOLDERS' EQUITY FOR THE SIX - MONTH PERIODS ENDED JUNE 30, 2000 AND 1999 (UNAUDITED) (Amounts in Thousand Baht) Consolidated The Company 2000 1999 2000 1999 Share Capital Ordinary share capital Beginning balance 2,549,349 697,375 2,549,349 697,375 Addition during the periods 200,968 1,755,899 200,968 1,755,899 Ending balance 2,750,317 2,453,274 2,750,317 2,453,274 Premium on Share Capital Beginning balance 189,351 987,863 189,351 987,863 Deduction during the periods (51,126) (772,209) (51,126) (772,209) Ending balance 138,225 215,654 138,225 215,654 Surplus on Land Revaluation Beginning balance 592,240 641,220 592,240 - Addition (Deduction) during the periods (592,240) (32,850) (592,240) 608,370 Ending balance - 608,370 - 608,370 Unrealized Gain on Available Securities for Sales Beginning balance - - - - Addition during the periods 5,950 - 5,950 - Ending balance 5,950 - 5,950 - Retained Earnings (Deficit) Appropriated - legal reserve Beginning balance 11,280 11,280 11,280 11,280 Addition(deduction) during the periods - - - - Ending balance 11,280 11,280 11,280 11,280 Deficit Beginning balance (2,989,449) (1,695,896) (2,989,449) (1,695,896) Addition (deduction) during the periods - net profit (loss) 340,387 (408,039) 340,387 (408,039) Ending balance (2,649,062) (2,103,935) (2,649,062) (2,103,935) Equity in Parent Company Held by Subsidiaries Beginning balance (5,890) (6,804) - - Addition during the periods 100,000 2,245 - - Deduction during the periods (100,000) - - - Deduction during the periods - adjust securities to be fair value 3,216 (6,662) - - Ending balance (2,674) (11,221) - - Total Shareholders' Equity 254,036 1,173,422 256,710 1,184,643 See notes to financial statements SANSIRI PUBLIC COMPANY LIMITED AND SUBSIDIARIES STATEMENTS OF DEFICIT FOR THE SIX - MONTH PERIODS ENDED JUNE 30, 2000 AND 1999 (UNAUDITED) (Amounts in Thousand Baht) Consolidated The Company 2000 1999 2000 1999 DEFICIT Beginning balance (2,989,449) (1,695,896) (2,989,449) (1,695,896) Less Appropriation: - legal reserve - - - - - dividend - - - - Net profit (loss) for the periods 340,387 (408,039) 340,387 (408,039) Total Deficit (2,649,062) (2,103,935) (2,649,062) (2,103,935) APPROPRIATED RETAINED EARNINGS Legal reserve 11,280 11,280 11,280 11,280 Total Appropriated Retained Earnings 11,280 11,280 11,280 11,280 Total Deficit (2,637,782) (2,092,655) (2,637,782) (2,092,655) See notes to financial statements SANSIRI PUBLIC COMPANY LIMITED AND SUBSIDIARIES STATEMENTS OF CASH FLOWS FOR THE SIX - MONTH PERIODS ENDED JUNE 30, 2000 AND 1999 (UNAUDITED) (Amounts in Thousand Baht) Consolidated The Company 2000 1999 2000 1999 CASH FLOWS FROM OPERATING ACTIVITIES : Net profit (loss) 340,387 (408,039) 340,387 (408,039) Adjustments to reconcile net profit (loss) to net cash provided by (used in) operating activities : Depreciation and amortization 25,514 35,639 14,011 14,602 Allowance for doubtful debts 2,320 3,092 (782) 322 Allowance for diminution in value of property development 154,161 17,293 - (2,134) Allowance for diminution in value of land under development for sale and rent 26,171 17,190 - - Leasehold revenue amortization (15,959) (15,959) - - Gain on sales of investments - (3,143) - (194) Gain on disposal of assets (578) (127) (608) (122) Unrealized gain on investments (726) (124) (628) - Allowance for devaluation of investments 6,062 - 6,062 - Unrealized loss on investments in parent company held by subsidiaries 50,216 (6,662) - - Income from capital reduction of associated company (11,250) - (11,250) - (Gain) loss on settlement of debts (638,422) 238,463 (219,779) 214,211 Share of net (gain) loss in subsidiary and associated companies (85) (583) (157,930) 109,903 Minority interest in net loss (227) - - - DECREASE( INCREASE) IN OPERATING ASSETS Fixed deposits with commitment (2,443) 3,848 (269) (457) Accounts, notes receivable and unbilled completed work (7,640) 14,705 491 (5,624) Work in progress - (2,284) - - Property development for sale (211,446) 75,977 (211,446) 13,112 Advance payment for construction - 31,967 - - Other current assets (2,403) 6,904 4,051 (8,315) Other assets 3,007 (35,561) 2,379 (16,217) INCREASE (DECREASE) IN OPERATING LIABILITIES : Accounts payable - construction 784 (57,213) 783 (2,955) Decoration payables (470) - - - Construction retention 115 (40,489) 115 (1,282) Deposit and advance received from customers 3,995 (18,731) 407 (13,550) Other current liabilities 50,938 (30,667) 12,795 (62,072) Other liabilities (2,110) 3,111 (2,110) 2,430 Net cash used in operating activities (230,089) (171,393) (223,321) (166,381) See notes to financial statements (Amounts in Thousand Baht) Consolidated The Company 2000 1999 2000 1999 DECREASE (DECREASE) IN CASH FLOWS FROM INVESTING ACTIVITIES : Short term investments - (31,827) - 194 Investments in related parties 37,481 (6,000) 31,981 (6,000) Loans to related parties - - (131,895) (34,829) Cost of property development for rent (1,134) (298) (1,353) - Dividend from associated company 50,522 - 50,522 - Minority interest 4,500 - - - Proceed from sales of equipment 669 288 664 283 Payment on purchase of equipment (13,723) (949) (13,202) (646) Net cash provided by (used in) investing activities 78,315 (38,786) (63,283) (40,998) INCREASE (DECREASE) IN CASH FLOWS FROM FINANCING ACTIVITIES : Loans from finance institutions (138,343) (29,263) (116,647) (14,263) Advance received from shareholders - 18,353 - 18,353 Margin loans for purchasing securities - (2,315) - - Loan from related company - - - 2,000 Long-term debts - (373) - (373) Cash received from increased share capital 149,842 983,689 149,842 983,689 Equity in parent company held by subsidiaries (100,000) (1,176) - - Net cash provided by (used in) financing activities (88,501) 968,915 33,195 989,406 Net increase (decrease) in cash and cash equivalents (240,275) 758,736 (253,409) 782,027 Cash and cash equivalents as at January 1, 2000 and 1999 556,542 (26,237) 542,178 (43,336) Cash and cash equivalents as at June 30, 2000 and 1999 316,267 732,499 288,769 738,691 SUPPLEMENTARY CASH FLOWS INFORMATION : Cash paid during the periods: Interest expenses - 69,757 - 69,757 Income taxes 8,966 3,659 8,152 1,612 See notes to financial statements SANSIRI PUBLIC COMPANY LIMITED AND SUBSIDIARIES NOTES TO FINANCIAL STATEMENTS (UNAUDITED) NOTE 1 - ECONOMIC ENVIRONMENT AND BASIS OF FINANCIAL STATEMENT PRESENTATION The operation of Sansiri Public Company Limited and subsidiaries may continue to be influenced for the foreseeable by the economic conditions in Thailand and the Asia Pacific Region in general. The financial statements of the companies reflect the management' s current assessment of the impact of current economic conditions on the financial position of the companies. However, actual results could differ from the management estimates. The financial statements of the Company have been presented in accordance with the Ministerial Regulation No. 7 (B.E.2539), under the Public Company Limited Act B.E. 2535 and in conformity with generally accepted accounting principles practiced in Thailand, and are not intended to present the financial position, results of operations and cash flows in accordance with accounting principles and practices generally accepted in countries and jurisdictions other than Thailand. The user of these financial statements should read together with the consolidated financial statements of Sansiri Public Company Limited and subsidiaries and the separate financial statements for the year ended December 31, 1999. The financial statements of Sansiri Public Company Limited and subsidiaries for the six-month period ended June 30, 2000 and for the year ended December 31,1999 have been presented on a going concern basis. The companies' ability to continue business as going concerns depends on the success of improvement plans being implemented to increase revenues, to reduce costs and to negotiate the extension for repayment of debts, restructuring debts and acquire new investors, etc. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets amounts or classification of liabilities that might be necessary if the companies were not successful to continue its business. NOTE 2 - RELATED PARTY TRANSACTIONS The Company has significant transactions with its related parties. The financial statements reflect the effects of these transactions on the basis determined by the companies concerned under normal business terms. The following significant outstanding balances occurred between the Company and its related parties as at June 30, 2000 and December 31, 1999 as follows: (Amounts in Million Baht) June 30 , 2000 December 31, 1999 Subsidiaries Associated and Subsidiaries Related Companies Related Companies Cheque on hand - - 0.04 - Receivable from service and commission 19.41 1.63 19.35 1.67 Advances 2.86 - 2.69 - Loans to subsidiaries 686.77 - 554.87 - Allowance for doubtful debts (250.00) - (250.00) - Allowance for diminution in value of investments (18.99) - (12.94) - Loans from subsidiaries 455.86 - - - Advance payables - 0.20 - - Retention - 0.46 - 0.46 Interest receivable 13.64 - 13.64 - Accrued expenses 0.21 - 0.34 - In the second quarter of 2000, a subsidiary company borrowed a loan from the parent company to purchase the parent company' s shares for debt repayment. (See note 11 to the financial statements) The following significant transactions occurred between the Company and its related parties for the six- month periods ended June 30, 2000 and 1999: (Amounts in Million Baht) For the six-month period ended For the six-month period ended June 30, 2000 June 30, 1999 Subsidiaries Associated and Subsidiaries Related Companies Related Companies Interest income - - 10.80 - Revenue from commission - 11.46 19.33 0.03 Revenue from business management 0.27 0.49 0.66 0.42 Rental income 0.10 0.24 0.70 0.10 Dividend income - 50.52 - - Interest expenses 0.02 - 0.57 - Other income - 11.20 - - Expenses 2.58 1.44 1.82 - The Company charged interest to subsidiaries at the rate of MLR % per annum and transferred assets for settlement of inter company debts (See note 11 to financial statements) and had the investments (See note 9 to financial statements) In the second quarter of 2000 loans to subsidiaries resulting from converting interest payable into promissory notes amounting to Baht 78.94 million, are without interest. The Company had commitments as guarantors of loans of related parties with domestic financial institutions. NOTE 3 - BASIS FOR CONSOLIDATION AND GENERAL INFORMATION As at June 30, 2000 Sansiri Public Company limited has its 6 subsidiaries. The parent company engages in the real estate development business and is located at 475 Siripinyo Building, Sri Ayutthaya Road, Payathai Rajthevi , Bangkok. The consolidated financial statements of Sansiri Public Company Limited and subsidiaries are prepared in accordance with generally accepted accounting principles, on a going concern basis, and Ministerial Regulation No.7 (B.E. 2539) dated October 25, 1996. The consolidated financial statements for the six-month period ended June 30, 2000 consisted of the financial statements of the parent company, Sansiri Public Company Limited, and the 99% subsidiary companies held by the parent company which are Chanachai Limited, Sanpinyo Limited, Prakarn Limited, Jainad Limited , and Sansiri Property Plus Limited (Formerly : Plus Property Management Limited) and the 55 % subsidiary company held by the parent company is Point Asia Access Co., Ltd. (Formaly : Sansiri Dot Com Limited.) In the consolidated and the Company's financial statements for the six-month period ended June 30, 2000, investments by equity method in an associated company of Baht 11.88 million, which were calculated based on the financial statements reviewed by other auditor and to which the share of profit was attributable in the amount of Baht 0.13 million, and the Company recognized unrealized gain on available securities for sale amounting to Baht 5.95 million. Investments in mutual fund in the amount of Baht 94.98 million was calaulated based on the financial statements for the year ended December 31, 1999 examined by the other auditor. The management is informed that the Fund will arrange the financial statements at the year end only. The Company recognized loss of Baht 0.05 million and gain from capital reduction of this fund amounting to Baht 9.9 and 1.4 million in the first and second quarter of 2000, respectively. As at June 30, 2000, the auditor could not provide any assurance to the financial statements of two subsidiaries, which are Chanachai Limited and Jainad Limited, for the six-month period ended June 30, 2000 regarding the uncertainty of the continuation business as going concern. The consolidated financial statements for the year ended December 31, 1999 consisted of the financial statements of the parent company, Sansiri Public Company Limited, and the 99% subsidiary companies held by the parent company which are Chanachai Limited, Sanpinyo Limited, Prakarn Limited, Jainad Limited and Sansiri Property Plus Limited (Formerly : Plus Property Management Limited) In the consolidated and the Company's financial statements for the year ended December 31, 1999, the investments in two associated companies at cost value of Baht 6 million and Baht 178.93 million, which were calculated by using the equity method and to which the share of profit (loss) was attributable in the amount of Baht 0.40 million, according to the financial statements audited by other auditor and Baht (7.75) million, was based on the financial statements for the nine-month period ended September 30, 1999 prepared by the (more)