SET Announcements

several consecutive years. b) The Company and its subsidiaries recorded an impairment charge on property and equipment amounting to Baht 82.9 million to reduce the book value of their property and equipment to the value appraised by an independent appraiser in June 1999. c) The adjustment on goodwill incurred from the acquisition of subsidiaries amounting to Baht 61.8 million between 1994 and 1995 which was calculated based on the differences between purchase considerations and the subsidiaries net book values, not the net fair values of the subsidiaries. d) The adjustment on the provision for loss from the forfeiture of land purchase deposit as the company defaulted in payment of the remaining land price due for payment since April 1998. e) The Company and its subsidiaries recorded an impairment charge on assets to be repossessed from the breach of a purchase contract by its customers to the consolidated and company financial statements amounting to Baht 30.9 million and Baht 29.0 million, respectively. In addition, the Company recorded a provision for impairment in value of assets expected to be received in settlement of loan to a shareholder amounting to Baht 20.4 million. 13 Prior year adjustments (continued) f) The Company and subsidiaries wrote off assets which comprise: * Half-year prepaid tax of 1993 which was over due for claim from the Revenue Department. The adjustments were made to consolidated and company financial statements amounting to Baht 4.5 million and Baht 3.4 million, respectively. In addition, the Group adjusted for impairment of assets comprising promissory notes and interest receivable from financial institutions which were permanently closed by the Ministry of Finance on 8 December 1997. The adjustments recorded to the consolidated and the company financial statements amounted to Baht 4.6 million and Baht 3.1 million, respectively. * Provision for impairment of investments in an associate that temporarily ceased its operation totaling Baht 3.2 million and other investment amounting to Baht 5 million. * Write off of a design program and related assets used specifically in the project which was closed since 1999 amounting to Baht 3.4 million. The above adjustments may have an impact on the operating results in several accounting periods in the past. However, the management is of the opinion that the costs to be incurred in determining the correct periods to which those adjustments belong to would not outweigh the benefits to be derived from obtaining such information. Therefore, all adjustments have been made to the last quarter of 1999. 14 Related party transactions The following transactions were carried out with related parties : a) Management fee income For the nine-month periods ended 30 September Company 2000 1999 Baht'000 Baht'000 World Time Holding Co.,Ltd. 211 4,727 Wipa View Co.,Ltd. 169 919 S & P Property Management Co.,Ltd. 151 272 Bang Plee View Co.,Ltd. 80 133 Ban Suk Sabai Co.Ltd. - 50 Total 611 6,101 14 Related party transactions (continued) b) Investments in and loans to subsidiaries Investments in subsidiaries Company Paid-up Percentage of holding Share capital By the group 30 September 31 December 30 September 31 December 2000 1999 2000 1999 Principal Million Million Activities Baht Baht Percent Percent Wipa View Co., Ltd. Real Estate 200.0 200.0 100.00 100.00 Continental City Co.,Ltd. Real Estate 40.0 40.0 100.00 100.00 World Time Holding Co., Ltd. Real Estate 15.0 15.0 100.00 100.00 Bang Plee View Co., Ltd. Real Estate 10.0 10.0 100.00 100.00 Research & Consultant Co., Ltd. Real Estate 10.0 10.0 65.00 65.00 Ban Suk Sabai Co., Ltd. Real Estate 2.0 2.0 100.00 100.00 Ban Siam Co., Ltd. Real Estate - 102.0 - 100.00 Company Investment value at cost 30 September 31 December 2000 1999 Baht'000 Baht'000 Investments in subsidiaries Wipa View Co., Ltd. 198,493 198,493 Continental City Co., Ltd. 42,783 42,783 World Time Holding Co., Ltd. 60,000 60,000 Bang Plee View Co., Ltd. 12,963 12,963 Research & Consultant Co., Ltd. 6,500 6,500 Ban Suk Sabai Co., Ltd. 1,000 1,000 Ban Siam Co., Ltd. - 102,000 In June of 2000, the Company disposed of a subsidiary, Ban Siam Co., Ltd, to a third party. Details of the disposal are disclosed in the note to financial statement No. 11. 14 Related party transactions (continued) b) Investments in and loans to subsidiaries Company 30 September 2000 (Baht '000) Advances and Less: Investment Net liabilities Net short-term loans Net investments loan to value using arisen from investments and advances in and loans to subsidiaries equity method in subsidiaries receivable subsidiaries Wipa View Co., Ltd. 109,424 (89,608) - - 19,815 Continental City Co.,Ltd. 5,295 (6,398) (1,104) - - Bang Plee View Co., Ltd. 38,552 (90,314) (51,761) - - Ban Suk Sabai Co., Ltd. 77,438 (25,694) - 51,744 - 230,709 (212,014) (52,865) 51,744 19,815 World Time Holding Co., Ltd. - 8,527 - - 8,527 Research & Consultant Co., Ltd. 3,587 1,240 - 3,587 1,240 234,296 (202,247) (52,865) 55,331 29,582 14 Related party transactions (continued) b) Investments in and loans to subsidiaries Company 31 December 1999 (Baht '000) Advances and Less: Investment Net liabilities Net short-term loans Net investments loan to value using arisen from investments and advances in and loans to subsidiaries equity method in subsidiaries receivable subsidiaries Wipa View Co,Ltd 106,589 (85,858) - - 20,731 Continental City Co,Ltd. 5,104 (4,428) - - 676 World Time Holding Co,Ltd. - (21,676) (21,676) - - Bang Plee View Co,Ltd 65,352 (86,032) (20,680) - - Ban Suk Sabai Co.,Ltd. 75,384 (23,762) - 51,622 - Ban Siam Co.,Ltd 250,538 (326,194) (75,656) - - 502,967 (547,950) (118,012) 51,622 21,407 Research & Consultant Co.,Ltd. 3,394 1,874 - 3,394 1,874 506,361 (546,076) (118,012) 55,016 23,281 Loans to subsidiaries are unsecured and denominated in Thai Baht. The loans have no fixed term of repayment and carry interest at rates varying from 5.00% to 12.75% per annum (1999 : 5.00% to 12.75% per annum). 14 Related party transactions (continued) c) Loan from subsidiary Company 30 September 31 December 2000 1999 Baht'000 Baht'000 Loans from subsidiary World Time Holding Co., Ltd. - 8,035 Loan from subsidiary is unsecured and denominated in Thai Baht. The loan has no fixed term of repayment and carries interest at the rate of 8.00% per annum. (1999 : 8.25% per annum). 15 Commitment and contingent liabilities The company and its subsidiaries have commitments and contingent liabilities as follows: Consolidated Company 30 September 31 December 30 September 31 December 2000 1999 2000 1999 Million Baht Million Baht Million Baht Million Baht thecontracts development project until completion 29.01 5.23 27.41 - Commitment under the contracts to purchase land - 4.50 - 4.50 29.01 9.73 27.41 4.50 Contingent liabilities as a Guarantor for customers housing loans of the company and subsidiaries 11.56 11.72 10.86 11.72 Contingent liabilities to bank and financial institutions for letters of guarantee 11.07 11.50 8.03 7.97 22.63 23.22 18.89 19.69 15 Commitment and contingent liabilities (continued) In April 2000, a local financial institution filed a case with the court against the Company and its subsidiaries for breach of an overdraft contract amounting to Baht 16.5 million. The overdrafts are secured by the mortgage of the Companys land and condominium units. During 2000, a financial institution filed cases with the court against the Company as a co-defendant in respect of guarantee for customers housing loans totaling Baht 27.9 million. The loans are secured by the mortgage of the borrowers houses. As at 30 September 2000, these cases are under the court proceedings and the ultimate outcome cannot be determined at present, therefore the Company has not made any provision for possible losses. 16 Subsequent events On 16 October 2000, the shareholders at the extraordinary meeting passed the following resolutions * To appropriate a right offering of 200 million ordinary shares to the existing shareholders in the ratio of one existing share to two new shares at the price of Baht 1.50 each. The existing shareholder who purchases one newly issued share is entitled to receive one unit of newly issued warrant. * To appropriate 200 million ordinary shares for the exercise of warrants In addition, the shareholders passed a resolution to issue and offer 200 million units of 5-year warrants with zero Baht offerred price to the existing shareholders. One unit of warrant holder entitles the holder to buy one ordinary share at Baht 6 per share, provided that in the case where there is any legal restriction that does not allow the exercise on that price, the exercise price will be Bath 10 per share. In the event that the average price of the ordinary shares of the Company which are traded on the Stock Exchange of Thailand reaches Baht 8, holders of the warrants who purchase ordinary shares will be entitled to exercise the right under the warrants only for one time, provided that the period for delivering the intention to exercise the said warrants for the last time will be in accordance with the period specified in the relevant notifications of the Securities and Exchange Commission with respect to the delivery of intention to exercise the warrants for the last time. After the said final exercise date, the warrants to purchase ordinary shares will then expire. In this regard, the calculation of the average price of the ordinary shares of the Company will be based on the closing price of the ordinary shares of the Company which are traded on the Stock Exchange of Thailand at the end of daily trading period of any 15 consecutive business day period. The shareholders also approved the reduction of the registered capital of the company from Baht 6,937.50 million to Baht 5,623.4 million by canceling 131,410,604 authorized but unissued shares.