) FINANCIAL STATEMENTS QUARTER 2

In Thousand Baht Three months ended Six months ended March 31, 1999 March 31, 1998 March 31, 1999 March 31, 1998 Statements of Income Rental income from operating lease contracts 47,974 37,137 95,914 69,768 Income from finance lease contracts 178 428 401 816 General and administrative expenses 50 163 249 862 Interest expense 32,266 29,492 78,037 58,974 3. LEASING RECEIVABLES UNDER OPERATING LEASE CONTRACTS The 102 leasing receivables under operating lease contracts which may be uncollectible as at March 31, 1999, categorized by aging schedules, are as follows: In Thousand Baht Over 3 months to 6 months 5,317 Over 6 months to 12 months 15,936 Over 12 months 13,823 Total 35,076 - 5 - The Company provided allowance for doubtful accounts covering leasing receivables under operating lease contracts equal to the estimated losses that may be incurred in the collection of receivables amounted to approximately Baht 36.1 million. 4. RECEIVABLES UNDER FINANCE LEASE CONTRACTS - Net In Thousand Baht 1999 1998 Receivables under finance lease contracts (including portion due within one year from March 31, 1999 amounting to approximately Baht 121 million) 268,969 496,062 Less unearned interest income (including portion due within one year from March 31, 1999 amounting to approximately Baht 11 million) ( 18,186) ( 43,104) Net 250,783 452,958 The 70 receivables under finance lease contracts which may be uncollectible as at March 31, 1999, categorized by aging schedules, are as follows: In Thousand Baht Over 3 months to 6 months 9,399 Over 6 months to 12 months 41,256 Over 12 months 36,970 Total 87,625 The Company provided allowance for doubtful accounts covering receivables under finance lease contracts equal to the estimated losses that may be incurred in the collection of receivables amounted to approximately Baht 84.3 million. 5. INVESTMENT IN ASSOCIATED COMPANY - At Cost In Thousand Baht Percentage of Company's Name Business Relation Holding (%) Investment Dividend Associated Company Sarathi Co., Ltd.Car driving service Shareholder 49 245 - - 6 - 6. PROPERTY AND EQUIPMENT - At Cost In Thousand Baht 1999 1998 Assets held for lease under operating lease contracts (mainly transportation equipment) (Note 12) 2,061,364 2,553,275 Office condominium (including land) 113,212 113,212 Furniture, fixtures and office equipment 17,825 17,895 Transportation equipment 19,544 13,519 Assets held for future lease 22,714 16,604 Advance payment for condominium - 6,000 Total 2,234,659 2,720,505 Less : accumulated depreciation (1,013,353) (1,082,023) allowance for decline in value of assets held for lease ( 11,805) - Property and Equipment - Net 1,209,501 1,638,482 Depreciation charges for the three-month and six-month periods ended March 31, 1999 amounted to approximately Baht 106.3 million and Baht 224.6 million, respectively, and for the three-month and six-month periods ended March 31, 1998 amounted to approximately Baht 136.0 million and Baht 276.0 million, respectively. 7. PROPERTY FORECLOSED In Thousand Baht 1999 1998 Land 40,431 17,341 Transportation equipment 24,484 37,141 Condominiums 5,227 5,227 Total 70,142 59,709 Less accumulated depreciation (12,070) (19,580) Net 58,072 40,129 Depreciation charges for the three-month and six-month periods ended March 31, 1999 amounted to approximately Baht 2.1 million and Baht 3.0 million, respectively, and for the three-month and six-month periods ended March 31, 1998 amounted to approximately Baht 3.1 million and Baht 5.7 million, respectively. - 7 - 8. BANK OVERDRAFT AND LOANS FROM FINANCIAL INSTITUTIONS In Thousand Baht 1999 1998 Bank overdraft 922 5,448 Notes payables - 200,000 Loan from bank 4,000 178,647 Total 4,922 384,095 As at March 31, 1999 the Company has overdraft line and other credit facilities with a related local bank totalling Baht 1,601 million, which bear interest at the rates specified in the agreements. 9. SHORT-TERM LOANS FROM AND PAYABLES TO RELATED COMPANIES In Thousand Baht 1999 1998 Notes payables 354,000 334,000 Insurance premium payable 3,977 - Accrued interest on short-term loans 4,353 3,579 Accrued interest on long-term loans 5,814 3,473 Total 368,144 341,052 As at March 31, 1999, the Company has credit facilities with two related insurance companies totalling Baht 500 million which bear interest at market rate. The above short-term loans are avaled by various local banks. 10. LONG-TERM LOANS FROM RELATED COMPANIES In Thousand Baht 1999 1998 Loans from banks 656,568 820,900 Loan from an insurance company - 100,000 Total 656,568 920,900 Less portion due within one year (482,192) (820,900) Net 174,376 100,000 - 8 - On August 11, 1998, the Company entered into loan and credit facilities agreement with a related local bank (Note 8) totalling Baht 1,352 million which bears interest at the rate specified in the agreement and is repayable in installments at the amounts indicated in the agreement commencing from August 1998. The loan agreement contains certain conditions and restrictions which include, among others, maintaining certain financial ratios, etc.. The Company entered into a loan agreement with a related local bank (Note 8) amounting to Baht 119 million which bears interest at the rate specified in the agreement. This loan is repayable in monthly installments. Loan from a related insurance company amounted to Baht 100 million in 1997 (avaled by two local banks). The loan was repaid during December 1998 to November 1999 and bears interest at market rate. 11. EMPLOYEES' PROVIDENT FUND The Company established a contributory employees' provident fund for its employees in accordance with the terms and conditions prescribed in the Ministerial Regulation No. 162 (B.E. 2526) issued under the Revenue Code Governing Provident Funds. Membership is voluntary upon attaining permanent status. The Company contributes to the fund monthly at a certain percentage of the employees basic salaries. On June 26, 1990, the provident fund was registered with the Ministry of Finance as a juristic entity under the provisions of the Provident Fund Act B.E. 2530. The Ministry of Finance also approved the transfer of the cumulative amount of the contributory employees' provident fund to the registered fund. The fund is managed by a Fund Manager in accordance with the terms and conditions prescribed in the Ministerial Regulation No. 2 (B.E. 2532) issued under the Provident Fund Act. B.E. 2530. Total contributions of the Company for the three-month and six-month periods ended March 31, 1999 amounted to approximately Baht 0.3 million and Baht 0.7 million, respectively, and for the three-month and six-month periods ended March 31, 1998 amounted to approximately Baht 0.3 million and Baht 0.6 million, respectively. - 9 - 12. ASSETS HELD FOR LEASE As at March 31, 1999 and 1998, the Company had a schedule by years of minimum future rentals for the next five years of assets held for operating lease as follows: In Thousand Baht Year ending March 31 1999 1998 1998 - 745,054 1999 554,540 463,847 2000 325,330 213,864 2001 170,295 54,416 2002 55,940 849 2003 1,978 - Total 1,108,083 1,478,030 Under the provisions of certain lease agreements, the lessees have an option to purchase the leased assets upon the expiration of the lease terms. In this connection, the lessees are required to pay the sums as guarantee for exercising the purchase option in advance. As at March 31, 1999 and 1998, unguaranteed residual value of assets held for lease under finance lease contracts amounted to approximately Baht 33.5 million and Baht 46.4 million, respectively. 13. RESERVE FUND This represents the reserve which the Company appropriates under the provisions of the Limited Public Company Act which require the Company to appropriate at least 5% of its annual net income after deduction of the deficit brought forward (if any) as reserve fund until the reserve reaches 10% of authorized share capital. The reserve is not available for dividend distribution. 14. CONTINGENT LIABILITY As at March 31, 1999, the Company was contingently liable for letter of guarantee issued by a local bank amounting to approximately Baht 0.3 million. 15. RECLASSIFICATION OF ACCOUNTS Certain accounts in the 1998 interim financial statements were reclassified to conform with the 1999 interim financial statement presentation. - 10 - 16. COMPUTER REMEDIATION PLAN FOR THE YEAR 2000 (UNAUDITED/UNREVIEWED) As at March 31, 1999, the Company had installed the computer system in connection with the storage and data processing in order to deal with the effect of Year 2000 issues for the most part except for certain functions relating to the transmatching and data back up file which are being upgraded. The estimated cost of the said upgrade amounted to approximately Baht 2.0 million, which will be recorded in the period incurred. It is expected that the computer remediation plan is completed on time. The Company still faces risks that other companies with whom the Company does business may be unsuccessful in their computer remedy projects within the time limit. However, the Company expects that the impact, if any, will not be significant to the Company's operations. 17. SEGMENT FINANCIAL INFORMATION The Company does not present the segment financial information in the interim financial statements since the Company engages in only the business on leasing assets under lease agreements. 18. UNCERTAINTIES OF ECONOMIC SITUATION Many Asia Pacific countries and Thailand have been encountering with severe economic difficulties relating to currency devaluations and slowdown in growth. The operations of the Company have been significantly affected, and will continue to be affected for the foreseeable future, by the region's unstable economy. As a result, there are significant uncertainties that may affect future operations, the recoverability of the Company's assets and the Company's ability to repay its debts as they mature. The ultimate outcome of this matter cannot presently be determined. The financial statements do not include any adjustment that might result from these uncertainties. Related effects will be reported in the financial statements as they become known and estimable.