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Basic earnings (loss) before extraordinary items (0.88) (1.12) 2.29 (1.35) Extraordinary items 3.04 (1.58) (0.13) (1.35) Basic earnings (loss) per share 2.16 (2.70) 2.16 (2.70) See notes to financial statements SANSIRI PUBLIC COMPANY LIMITED AND SUBSIDIARIES STATEMENTS OF CHANGE IN SHAREHOLDERS' EQUITY FOR THE NINE - MONTH PERIODS ENDED SEPTEMBER 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 1,838,314 200,968 1,838,314 Ending balance 2,750,317 2,535,689 2,750,317 2,535,689 Premium on Share Capital Beginning balance 189,351 987,863 189,351 987,863 Deduction during the periods (51,126) (791,682) (51,126) (791,682) Ending balance 138,225 196,181 138,225 196,181 Surplus on Land Revaluation Beginning balance 592,240 641,220 592,240 - Addition (Deduction) during the periods (592,240) (48,980) (592,240) 592,240 Ending balance - 592,240 - 592,240 Minority interest Beginning balance - - - - Addition (Deduction) during the periods 3,343 - - - Ending balance 3,343 - - - 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) Deduction (Addition) during the periods - net profit ( loss) 579,004 (395,414) 579,004 (395,414) Ending balance (2,410,445) (2,091,310) (2,410,445) (2,091,310) Equity in Parent Company Held by Subsidiaries Beginning balance (5,890) (6,804) - - Addition during the periods 100,000 4,020 - - Deduction during the periods (100,000) - - - Deduction during the periods - adjust securities to be fair value 3,835 (1,677) - - Ending balance (2,055) (4,461) - - Total Shareholders' Equity 496,615 1,239,619 495,327 1,244,080 See notes to financial statements SANSIRI PUBLIC COMPANY LIMITED AND SUBSIDIARIES STATEMENTS OF DEFICIT FOR THE NINE - MONTH PERIODS ENDED SEPTEMBER 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 579,004 (395,414) 579,004 (395,414) Total Deficit (2,410,445) (2,091,310) (2,410,445) (2,091,310) 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 (2,399,165) (2,080,030) (2,399,165) (2,080,030) See notes to financial statements SANSIRI PUBLIC COMPANY LIMITED AND SUBSIDIARIES STATEMENTS OF CASH FLOWS FOR THE NINE - MONTH PERIODS ENDED SEPTEMBER 30, 2000 AND 1999 (UNAUDITED) (Amounts in Thousand Baht) Consolidated The Company 2000 1999 2000 1999 CASH FLOWS FROM OPERATING ACTIVITIES : Net profit (loss) 579,004 (395,414) 579,004 (395,414) Adjustments to reconcile net profit (loss) to net cash provided by (used in) operating activities : Depreciation and amortization 39,150 53,715 21,664 28,141 Allowance for loss on subsidiaries (5,606) - - - Allowance for doubtful debts (236,388) 3,074 (231,736) 141 Allowance for diminution in value of property development 127,900 8,716 - (2,134) Allowance for diminution in value of land under development for sale and rent - 1,177 - - Loss (gain) from construction contract cancellation 8,182 (42,276) 11,550 (42,276) Leasehold revenue amortization (23,939) (23,939) - - Loss on tranfer investments held by subsidiary for debts settlement 46,913 - - - Unrealized loss on investments in parent company held by subsidiaries 7,590 - - - Loss (gain) on sales of investments 1,958 (2,064) - (755) Gain on disposal of assets (578) (127) (608) (122) Interest income from subsidaries - - (18,945) - Unrealized gain on investments (1,017) (350) (879) (365) Allowance for devaluation of investments (12,936) - (12,936) - (Gain) loss on settlement of debts (546,493) 231,566 305,064 198,080 Share of net (gain) loss in subsidiary and associated companies (54,028) 126 (661,492) 126,626 Minority interest in net loss (1,157) - - - DECREASE ( INCREASE) IN OPERATING ASSETS Fixed deposits with commitment (28,809) 3,848 (28,050) (457) Accounts, notes receivable and unbilled completed work 2,237 20,768 64 951 Work in progress - (3,806) - - Property development for sale (303,383) 87,185 (303,503) 13,095 Advance payment for construction (1,604) 31,967 (1,604) - Other current assets (861) 13,337 4,270 (7,204) Other assets 2,595 (36,100) 1,911 (17,543) (Amounts in Thousand Baht) Consolidated The Company 2000 1999 2000 1999 INCREASE (DECREASE) IN OPERATING LIABILITIES : Accounts payable - construction 7,112 (54,713) 7,112 (455) Decoration payables (470) - - - Construction retention 2,106 (41,488) 2,106 (2,281) Deposit and advance received from customers 382 (18,433) 306 (14,211) Other current liabilities 61,875 (12,854) 5,055 (58,417) Other liabilities (1,689) 4,811 (1,708) 4,122 Net cash used in operating activities (331,954) (171,274) (323,355) (170,478) DECREASE (INCREASE) IN CASH FLOWS FROM INVESTING ACTIVITIES : Short term investments 200 (20,730) - 10,200 Investments in related parties 87,578 (184,930) 81,078 (191,930) Loans to related parties - - (121,408) (40,849) Cost of property development for rent 34,118 (298) (17,932) - Dividend from associated company 50,522 - 50,522 - Minority interest 4,500 - - - Proceed from sales of equipment 670 288 665 283 Payment on purchase of equipment (25,284) (2,917) (18,915) (2,329) Net cash provided by (used in) investing activities 152,304 (208,587) (25,990) (224,625) INCREASE (DECREASE) IN CASH FLOWS FROM FINANCING ACTIVITIES : Loans from finance institutions (132,356) (22,727) (116,847) (15,661) Margin loans for purchasing securities - (2,315) - - Current portion of long term loan (45,000) - - - Long term debts - (443) - (443) Cash received from increased share capital 149,842 1,046,632 149,842 1,046,632 Equity in parent company held by subsidiaries (100,000) (117) - - Net cash provided by (used in) financing activities (127,514) 1,021,030 32,995 1,030,528 Net increase (decrease) in cash and cash equivalents (307,164) 641,169 (316,350) 635,425 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 September 30, 2000 and 1999 249,378 614,932 225,828 592,089 SUPPLEMENTARY CASH FLOWS INFORMATION : Cash paid during the periods: Interest expenses - 72,356 - 71,421 Income taxes 3,511 4,826 2,075 2,433 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 the regulations of the Stock Exchange of Thailand. The Company's financial statements are prepared in Thai version as required by the Thai law, and translated into English version for the convenience of a reader of the financial statements. The said interim financial statements should be read in conjunction with the audited financial statements and the notes therein for the year ended December 31, 1999, and the interim financial statements for the six-month period ended June 30, 2000. The financial statements of Sansiri Public Company Limited and subsidiaries for the nine-month period ended September 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 , 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 September 30, 2000 and December 31, 1999 as follows: (Amounts in Million Baht) September 30, 2000 December 31, 1999 Subsidiaries Associated and Subsidiaries Related Companies Related Companies Cheque on hand - - 0.04 - Receivable from service and commission 19.94 0.40 19.35 1.67 September 30, 2000 December 31, 1999 Subsidiaries Associated and Subsidiaries Related Companies Related Companies Advances - - 2.69 - Loans to subsidiaries (Note to financial statement 15.2) 3.00 - 554.87 - Allowance for doubtful debts (19.47) - (250.00) - Allowance for diminution in value of investments - - (12.94) - Loans from subsidiaries 240.03 - - - Advance payables - 0.20 - - Retention - 0.23 - 0.46 Interest receivable - - 13.64 - Accrued expenses 0.24 - 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. The following significant transactions occurred between the Company and its related parties for the nine- month periods ended September 30, 2000 and 1999: (Amounts in Million Baht) For the nine-month period ended For the nine-month period ended September 30, 2000 September 30, 1999 Subsidiaries Associated and Subsidiaries Related Companies Related Companies Interest income 18.95 - 13.31 - Revenue from commission 0.13 11.46 - - Revenue from business management 1.35 0.23 0.79 - Rental income 0.13 0.34 0.82 0.24 Dividend income - 50.52 - - Interest expenses 0.49 0.35 0.08 - Expenses 3.92 1.96 3.84 - Cost of project - - 0.94 - Loss on settlement of debts 261.46 - - - The Company charged interest to subsidiaries at the rate of MLR % per annum and transferred assets for settlement of inter company debts and had the investments (See note 8 to financial statements) For the nine-month period ended September 30, 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. The lands of two subsidiaries financed by the parent company were pledged as collateral to financial institutions for loans of the parent company. After that the two subsidiaries transferred the said loan to repay the debts on behalf the parent company .As at July 1,2000 the two subsidiary companies have sent their letters confirming their agreement to offset their debts due to the parent company in the amount of Baht 157.96 million and Baht 57.90 million, by offsetting the parent company's debts due to the subsidiary companies of Baht 377.58 million and Baht 78.30 million, respectively, thus the remaining balances of debts which the parent company has to repay to the subsidiary companies of Baht 219.62 million and Baht 20.40 million respectively. By means of offsetting the debts described above, the parent company recorded retroactively the interest income of Baht 18 million from January 1999 to June 30, 2000, in the third quarter of 2000, being the said accrued interest which in the past the parent company could not recognize under the condition that it is not permitted the company who has given loan recognizes interest as income if it is over 6 months. As at August 31, 2000 and September 29, 2000 the parent company has sent a letter confirming their agreement to cancel the debts owed by the other two subsidiary companies with 99 percent of shareholding which are Jainad Limited and Chanachai Limited in the amount of approximately Baht 298 million and Baht 244.39 million respectively, causing additional loss to the allowance already set for the doubtful debt and expenses of Baht 261.46 million.In addition, Chanachai Company has used shares and the project land for the debt settlement on behalf of Jainad Co., Ltd, in the amount of Baht 7.2 million (See note 10.3 to financial statements), according to the minutes of the Director's meeting held on June 1, 2000, in which a resolution was passed permitting forgiveness of debts between the parent company and its subsidiaries. NOTE 3 - BASIS FOR CONSOLIDATION AND GENERAL INFORMATION As at September 30, 2000 Sansiri Public Company limited has its 7 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 nine-month period ended September 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 , Sansiri Property Plus Limited (Formerly : Plus Property Management Limited) and Sansiri Home Network Co., Ltd and the 55 % subsidiary company held by the parent company is Point Asia Access Co., Ltd. (Formally : Sansiri Dot Com Limited.) (more)