FINANCIAL STATEMENTS QUARTER 3 (AS OF JUNE 30,1999)

PHATRA LEASING PUBLIC COMPANY LIMITED INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH AND NINE-MONTH PERIODS ENDED JUNE 30, 1999 AND 1998 AND REPORT OF CERTIFIED PUBLIC ACCOUNTANT EXPRESSED IN Thai Baht REPORT OF CERTIFIED PUBLIC ACCOUNTANT To The Board of Directors of Phatra Leasing Public Company Limited I have made a review of the balance sheets of Phatra Leasing Public Company Limited as at June 30, 1999 and 1998, and the related statements of income, changes in shareholders' equity, retained earnings and cash flows for the three-month and nine-month periods then ended, in accordance with standards established by the Institute of Certified Accountants and Auditors of Thailand. A review of interim financial statements consists principally of obtaining an understanding of the system for the preparation of interim financial statements, applying analytical review procedures to financial data, and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an examination in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, I do not express such an opinion. Based on my review, I am not aware of any material modifications that should be made to the accompanying interim financial statements for them to be in conformity with generally accepted accounting principles (in Thailand). PRASIT MUSIKABHANTU C.P.A. (THAILAND) Registration No. 2675 Bangkok July 15, 1999 "UNAUDITED" "REVIEWED" PHATRA LEASING PUBLIC COMPANY LIMITED BALANCE SHEETS JUNE 30, 1999 AND 1998 A S S E T S In Thousand Baht 1999 1998 CURRENT ASSETS Cash on hand and in banks (Note 2) 47,667 49,260 Short-term investment in promissory notes (Note 2) - 60,390 Leasing receivables under operating lease contracts (Notes 2 and 3) 60,452 50,352 Less allowance for doubtful accounts ( 36,086) ( 15,393) Leasing receivables under operating lease contracts - net 24,366 34,959 Receivables under finance lease contracts - net (Notes 2 and 4) 221,083 400,311 Less allowance for doubtful accounts ( 84,263) ( 27,741) Receivables under finance lease contracts - net 136,820 372,570 Other current assets Prepaid expenses (Note 2) 28,717 23,301 Receivable from Revenue Department 5,014 6,316 Advance payment for customers 3,628 6,136 Others (Note 2) 3,372 8,717 Total Current Assets 249,584 561,649 INVESTMENTS IN SHARES - At Cost Associated company (Notes 2 and 5) 245 245 Other company 5,000 5,000 Total Investments in Shares 5,245 5,245 "UNAUDITED" "REVIEWED" - 2 - In Thousand Baht 1999 1998 PROPERTY AND EQUIPMENT - Net (Note 6) 1,147,804 1,557,968 PROPERTY FORECLOSED - Net (Note 7) 56,764 41,235 OTHER ASSETS Deferred income tax - net 188,674 172,554 Other receivables - net of allowance for doubtful accounts of approximately Baht 58 million in 1999 and Baht 10 million in 1998 2,100 42,542 Others 9,239 32,463 Total Other Assets 200,013 247,559 TOTAL ASSETS 1,659,410 2,413,656 See accompanying Notes to Interim Financial Statements. "UNAUDITED" "REVIEWED" PHATRA LEASING PUBLIC COMPANY LIMITED BALANCE SHEETS JUNE 30, 1999 AND 1998 LIABILITIES AND SHAREHOLDERS' EQUITY In Thousand Baht 1999 1998 CURRENT LIABILITIES Bank overdrafts and loans from financial institutions (Notes 2 and 8) 985 400,426 Accounts payable - trade 13,208 17,960 Current portion of long-term loans (Notes 2 and 10) 574,994 860,900 Short-term loans from and payables to related companies (Notes 2 and 9) 304,743 261,947 Other current liabilities Rental income received in advance (Note 2) 5,466 9,392 Accrued interest expense - 37,896 Others (Note 2) 4,635 10,759 Total Current Liabilities 904,031 1,599,280 LONG-TERM LOANS FROM RELATED COMPANIES - Net (Notes 2 and 10) 87,085 60,000 ADVANCE RECEIVED FROM LESSEES FOR EXERCISING PURCHASE OPTION (Notes 2 and 12) 71,350 80,824 Total Liabilities 1,062,466 1,740,104 SHAREHOLDERS' EQUITY Share capital - common share; Baht 10 par value Authorized, issued and fully paid-up - 30,000,000 shares 300,000 300,000 Premium on share capital 156,000 156,000 Retained earnings Appropriated for reserve fund (Note 13) 9,216 9,216 Unappropriated 131,728 208,336 Total Shareholders' Equity 596,944 673,552 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 1,659,410 2,413,656 See accompanying Notes to Interim Financial Statements. "UNAUDITED" "REVIEWED" PHATRA LEASING PUBLIC COMPANY LIMITED STATEMENTS OF INCOME FOR THE THREE-MONTH AND NINE-MONTH PERIODS ENDED JUNE 30, 1999 AND 1998 In Thousand Baht Three months ended Nine months ended June 30, 1999 June 30, 1998 June 30, 1999 June 30, 1998 REVENUES Rental income from operating lease contracts (Notes 1 and 2) 163,156 203,091 530,755 624,085 Income from finance lease contracts (Notes 1 and 2) 4,336 12,181 17,529 41,818 Other income Gain on sales of assets held for lease and property foreclosed 3,453 4,187 6,588 24,967 Penalty income from delay payment 2,653 3,311 6,372 12,632 Others 1,768 3,417 6,524 8,431 Total Revenues 175,366 226,187 567,768 711,933 COSTS AND EXPENSES Direct rental costs 116,487 148,700 371,286 467,068 General and administrative expenses (Note 2) 15,348 21,197 49,918 101,198 Interest expense (Note 2) 25,420 51,285 103,457 168,832 Directors' remuneration 144 72 354 360 Total Costs and Expenses 157,399 221,254 525,015 737,458 INCOME (LOSS) BEFORE INCOME TAX AND CUMULATIVE EFFECT OF ACCOUNTING CHANGE 17,967 4,933 42,753 ( 25,525) Income Tax ( 5,492) - ( 12,997) - INCOME (LOSS) BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE 12,475 4,933 29,756 ( 25,525) Cumulative Effect of Accounting Change (Note 1) - - - ( 38,000) NET INCOME (LOSS) 12,475 4,933 29,756 ( 63,525) Earnings (Loss) per Share (Baht) Income (loss) before cumulative effect of accounting change 0.42 0.16 0.99 ( 0.85 ) Cumulative effect of accounting change - - - ( 1.27 ) Net income (loss) 0.42 0.16 0.99 ( 2.12 ) See accompanying Notes to Interim Financial Statements. "UNAUDITED" "REVIEWED" PHATRA LEASING PUBLIC COMPANY LIMITED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY FOR THE THREE-MONTH AND NINE-MONTH PERIODS ENDED JUNE 30, 1999 AND 1998 In Thousand Baht Three months ended Nine months ended June 30, 1999 June 30, 1998 June 30, 1999 June 30, 1998 Common Share Capital Balance, beginning of period 300,000 300,000 300,000 300,000 Addition - - - - Balance, end of period 300,000 300,000 300,000 300,000 Premium on Share Capital Balance, beginning of period 156,000 156,000 156,000 156,000 Addition - - - - Balance, end of period 156,000 156,000 156,000 156,000 Retained Earnings Appropriated Reserve Fund Balance, beginning of period 9,216 9,216 9,216 9,216 Addition - - - - Balance, end of period 9,216 9,216 9,216 9,216 Unappropriated Retained Earnings Balance, beginning of period 119,253 203,403 101,972 271,861 Addition (deduction) - net income (loss) 12,475 4,933 29,756 ( 63,525) Balance, end of period 131,728 208,336 131,728 208,336 TOTAL SHAREHOLDERS' EQUITY 596,944 673,552 596,944 673,552 See accompanying Notes to Interim Financial Statements. "UNAUDITED" "REVIEWED" PHATRA LEASING PUBLIC COMPANY LIMITED STATEMENTS OF RETAINED EARNINGS FOR THE THREE-MONTH AND NINE-MONTH PERIODS ENDED JUNE 30, 1999 AND 1998 In Thousand Baht Three months ended Nine months ended June 30, 1999 June 30, 1998 June 30, 1999 June 30, 1998 UNAPPROPRIATED RETAINED EARNINGS Brought forward from prior period 119,253 203,403 101,972 271,861 Net income (loss) for the period 12,475 4,933 29,756 ( 63,525) Total Unappropriated Retained Earnings, End of Period 131,728 208,336 131,728 208,336 APPROPRIATED RETAINED EARNINGS Reserve fund 9,216 9,216 9,216 9,216 TOTAL RETAINED EARNINGS 140,944 217,552 140,944 217,552 See accompanying Notes to Interim Financial Statements. "UNAUDITED" "REVIEWED" PHATRA LEASING PUBLIC COMPANY LIMITED STATEMENTS OF CASH FLOWS FOR THE THREE-MONTH AND NINE-MONTH PERIODS ENDED JUNE 30, 1999 AND 1998 In Thousand Baht Three months ended Nine months ended June 30, 1999 June 30, 1998 June 30, 1999 June 30, 1998 CASH FLOWS FROM OPERATING ACTIVITIES: Net income (loss) 12,475 4,933 29,756 ( 63,525) Reconciliations of net income (loss) to net cash provided by (used in) operating activities: Cumulative effect of accounting change - - - 38,000 Depreciation and amortization 105,090 139,369 338,607 439,531 Provision for doubtful accounts - 1,748 - 43,232 Unrealized gain on exchange rate - ( 139) - ( 421) Reversal of provision for loss on decline in value of assets held for lease ( 1,042) - ( 3,791) - Gain on sales of assets held for lease and property foreclosed ( 3,453) ( 4,187) ( 6,588) ( 24,967) Decrease (increase) in leasing receivables under operating lease contracts 127 ( 983) 6,664 3,337 Decrease in receivables under finance lease contracts 29,700 52,647 114,391 252,121 Decrease in receivables under hire-purchase contracts - - 602 - Decrease in prepaid expenses and other current assets 2,347 6,668 1,568 10,749 Increase in property foreclosed ( 1,678) ( 6,358) ( 6,319) ( 9,305) Decrease (increase) in deferred income tax 5,492 ( 1,822) 13,163 ( 2,746) Decrease (increase) in other assets ( 473) ( 28,360) 3,325 ( 27,540) Increase (decrease) in accounts payable-trade ( 15,797) ( 5,370) 6,803 11,498 "UNAUDITED" "REVIEWED" - 2 - In Thousand Baht Three months ended Nine months ended June 30, 1999 June 30, 1998 June 30, 1999 June 30, 1998 Decrease in income tax payable - - ( 6,811) - Increase (decrease) in other current liabilities ( 1,018) 20,989 ( 11,832) 10,316 Decrease in advance received from lessees for exercising purchase option ( 1,791) ( 23,473) ( 7,746) ( 43,825) Net Cash Provided by Operating Activities 129,979 155,662 471,792 636,455 CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of property and equipment ( 72,183) (106,124) (211,497) (296,484) Proceeds from sales of assets held for lease and property foreclosed 36,788 57,334 159,013 152,836 Net Cash Used in Investing Activities ( 35,395) ( 48,790) ( 52,484) (143,648) CASH FLOWS FROM FINANCING ACTIVITIES: Increase (decrease) in loans from financial institutions ( 4,000) 20,000 (242,966) (340,000) Decrease in short-term loans from and payables to related companies ( 61,666) ( 75,632) ( 52,182) ( 121,098) Increase (decrease) in long-term loans from related companies 5,511 - (151,368) - Net Cash Used in Financing Activities ( 60,155) ( 55,632) (446,516) (461,098) NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 34,429 51,240 ( 27,208) 31,709 Cash and Cash Equivalents at Beginning of Period 12,253 56,633 73,890 76,164 CASH AND CASH EQUIVALENTS AT END OF PERIOD 46,682 107,873 46,682 107,873 "UNAUDITED" "REVIEWED" (more)