THE UNION MOSAIC INDUSTRY PUBLIC COMPANY LIMITED
AUDITOR'S REPORT AND FINANCIAL STATEMENTS
AS AT MARCH 31, 2000 AND 1999 (UNAUDITED/REVIEWED ONLY)
AND AS AT DECEMBER 31, 1999 (AUDITED)
AUDITOR'S REPORT
To The Shareholders of
THE UNION MOSAIC INDUSTRY PUBLIC COMPANY LIMITED
I have reviewed the balance sheets of THE UNION MOSAIC INDUSTRY PUBLIC COMPANY LIMITED as
at March 31, 2000, and related statements of income, statements of changes in shareholders' equity, statements of retained
earnings and statements of cash flows for the three months ended March 31, 2000 and 1999. These financial statements are
the responsibility of the Company's management as to their correctness and completeness of the presentation. My
responsibility is to issue a report on these financial statements based on my review.
I conducted my review in accordance with auditing standards applicable to review engagements. This standard
requires that I plan and perform the review to obtain moderate assurance as to whether the financial statements are free of
material misstatement. A review is limited primarily to inquiries of company personnel and analytical procedures applied to
financial data and thus provides less assurance than an audit. Accordingly, I do not express an opinion on these financial
statements.
Net profit of three associated companies which were brought into the computation of investment under
equity method, were taken from their respective unreviewed financial statements by another auditor. Investment in the
aforementioned associated companies of the company represented the holding of 0.75 per cent of total assets and equity
gain represented at 0.47 per cent of net profit (loss) for the three months ended March 31, 2000.
As mentioned in note to the financial statement no. 8.3, the company has not prepared the consolidated financial
statements for the group of business under the certain companies' control in accordance with the Thai Accounting Standard No.
44 Consolidated Financial Statement and Accounting for Investments in Subsidiaries. Since the mentioned companies
cannot completely prepare the financial statements for the three months ended March 31, 2000. The company, therefore,
cannot prepare the consolidated financial statements in accordance with those Accounting Standard.
Except for the matters mentioned in the third and fourth paragraphs, nothing has come to my attention that causes
me to believe that the financial statements do not present fairly in all material respect in accordance with generally accepted
accounting principles based on my review.
I draw your attention to the following notes to financial statements:
(1) As stated in notes to financial statements no.1, the effect of adverse economic crisis in Thailand and overall
Asia Pacific countries resulting from the currency devaluation and the economic slowdown. The company engages in
real estate the company operating, have severely affected from the above situation and may continue to be affected for the
foreseeable future.
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(2) As stated in notes to financial statements no. 10, the company has temporarily suspended the project
under construction - factory expansion having the investment value amount of Baht 157.75 million as at March 31, 2000 due
to the economic fluctuation and slowdown in the real estate business as stated in note 1. However, the company expects
to take benefit in the future when the economic is recovered.
(3) As shown in the financial statements, the result of the company's operation incurred loss for many consecutive
years, having the total deficit of Baht 663.12 million as at March 31, 2000. The shareholders' equity shown the outstanding
balance of Baht 395.67 million, but the management expects that the company's operation will be recovered in the future.
(4) As stated in notes to financial statements no. 14, regarding to long-term liabilities, the company entered into
additional loan agreement which incurred current portion of long-term debt amount of Baht 955.26 million as at March 31,
2000. Up to now, the company has not made principles repayment upon the new agreement since the company is under
the proceed of debt restructuring.
I have audited the financial statements of THE UNION MOSAIC INDUSTRY PUBLIC COMPANY LIMITED
for the year ended December 31, 1999, in accordance with generally accepted auditing standards and I expressed an
unqualified in my report dated February 25, 2000 included the conditions regarding the realization on equity gain (loss) of
the three associated companies. Those financial statements have been taken from unaudited financial statements by other
auditors. Investment in associated companies represented the holding of 0.72 per cent of total assets and the equity gain
represented at 0.09 per cent. Moreover, the note to financial statements stated the effect of economic crisis that caused to
temporarily suspend the invested project under construction - factory amount of Baht 367.95 million, incurring loss for three
consecutive years and the deficit amount of Baht 599.74 million. The shareholders' equity, therefore, shown the outstanding
balance of Baht 459.74 million. However, the management expects that the company's operation will be recovered in
the future. The current portion of long term debt amount of Baht 781.07 million, which has not made the principle
repayment upon the new agreement, has been under the proceed of debt restructuring. The balance sheet as at December 31,
1999, presented for comparison purpose, is a partial of the audited and reported financial statements. I have not performed any
auditing procedures since that date.
Office of D I A International Auditing
(Mrs. Vilairat Rojnuckarin)
C.P.A. (Thailand)
Registration No. 3104
May 12, 2000
THE UNION MOSAIC INDUSTRY PUBLIC COMPANY LIMITED
BALANCE SHEETS
AT MARCH 31, 2000 AND 1999 (UNAUDITED/REVIEWED ONLY)
AND AS AT DECEMBER 31, 1999 (AUDITED)
Assets March 31, 2000 December 31, 1999
Current assets
Cash in hand and at banks (note 4) 10,363,027.12 7,997,908.06
Short-term investments (note 5) 35,761,579.47 36,461,954.47
Accounts and notes receivable (note 6) 390,336,100.08 327,557,947.50
Less Allowance for doubtful accounts (28,131,933.79) (28,131,933.79)
Accounts and notes receivable - net 362,204,166.29 299,426,013.71
Inventories (note 7) 374,248,787.25 463,353,379.60
Other current asset
Advance 4,371,097.50 3,746,036.11
Revenue Department - receivable 0.00 4,461,477.17
Refundable custom tax 2,729,915.85 2,510,522.67
Prepaid expenses 5,133,015.35 6,002,569.43
Other 2,271,072.37 1,381,056.86
Total current assets 797,082,661.20 825,340,918.08
Investments in related companies - net (note 8) 26,139,147.06 25,839,149.95
Deposits with commitment (note 9) 30,000,000.00 30,000,000.00
Property, plant and equipment - net (note 10) 1,245,827,015.88 1,287,803,854.97
Deposit (note 11) 1,229,250.00 773,400.00
Other assets (note 12) 3,554,449.55 3,967,212.42
Total assets 2,103,832,523.69 2,173,724,535.42
Notes to financial statements are parts of these financial statements.
THE UNION MOSAIC INDUSTRY PUBLIC COMPANY LIMITED
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Liabilities and shareholders' equity March 31, 2000 December 31, 1999
Current liabilities
Bank overdrafts and loans from bank (note 13) 445,786,186.61 421,620,545.53
Accounts payable 182,653,760.48 213,119,369.51
Current portion of long-term debt (note 14) 955,256,000.00 781,066,600.00
Default on current portion of long-term debt (note 14) 84,000,000.00 0.00
Accrued expenses 24,782,353.81 33,970,795.22
Other loan payables 10,000,000.00 10,000,000.00
Other current liabilities 5,686,186.54 1,072,936.84
Total current liabilities 1,708,164,487.44 1,460,850,247.10
Long-term liabilities (note 14) 0.00 253,129,400.00
Total liabilities 1,708,164,487.44 1,713,979,647.10
Shareholders' equity
Share capital
Authorized share capital
50,000,000 common shares of Baht 10 each 500,000,000.00 500,000,000.00
Issued and paid-up capital
32,000,000 common shares of Baht 10 each 320,000,000.00 320,000,000.00
Premium on share capital 498,800,000.00 498,800,000.00
Appraisal surplus of land 207,515,676.00 207,515,676.00
Unrealized (gain) loss from changing fair value of investments (note 15) 472,625.00 1,173,000.00
Retained earnings (Deficit)
Appropriated
Legal reserve 32,000,000.00 32,000,000.00
Unappropriated (663,120,264.75) (599,743,787.68)
Total shareholders' equity 395,668,036.25 459,744,888.32
Total liabilities and shareholders' equity 2,103,832,523.69 2,173,724,535.42
Notes to financial statements are parts of these financial statements.
THE UNION MOSAIC INDUSTRY PUBLIC COMPANY LIMITED
STATEMENTS OF INCOME
FOR THE THREE MONTHS ENDED MARCH 31, 2000 AND 1999
UNAUDITED/REVIEWED ONLY
2000 Baht 1999
(Adjustment)
Revenues
Sales 380,508,817.39 264,155,488.94
Other income 8,363,961.84 5,438,119.24
Total revenues 388,872,779.23 269,593,608.18
Expenses
Cost of sales 353,646,107.53 275,646,761.54
Unappropriated net loss (gain) of associated companies (299,997.11) 237,344.01
Selling and administrative expenses 61,816,774.78 61,690,772.88
Interest expenses 37,086,371.10 38,565,431.05
Total expenses 452,249,256.30 376,140,309.48
Net profit (loss) (63,376,477.07) (106,546,701.30)
Net profit (loss) per share (1.98) (3.33)
Dividend per share - -
Notes to financial statements are parts of these financial statements.
THE UNION MOSAIC INDUSTRY PUBLIC COMPANY LIMITED
STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
FOR THE THREE MONTHS ENDED MARCH 31, 2000 AND 1999
UNAUDITED/REVIEWED ONLY
2000 Baht 1999
(Adjustment)
Share capital
Common shares
Beginning of the period 320,000,000.00 320,000,000.00
End of the period 320,000,000.00 320,000,000.00
Paid-in capital
Premium on share capital
Beginning of the period 498,800,000.00 498,800,000.00
End of the period 498,800,000.00 498,800,000.00
Appraisal surplus of land
Beginning of the period 207,515,676.00 266,102,532.00
End of the period 207,515,676.00 266,102,532.00
Unrealized gain (loss) from changing fair value of investments (note 15) 472,625.00 0.00
Retained earnings (Deficit)
Appropriated
Legal reserve
Beginning of the period 32,000,000.00 32,000,000.00
End of the period 32,000,000.00 32,000,000.00
Unappropriated
Beginning of the period (599,743,787.68) (302,187,898.51)
Net profit (loss) (63,376,477.07) (106,546,701.30)
End of the period (663,120,264.75) (408,734,599.81)
Total shareholders' equity 395,668,036.25 708,167,932.19
Notes to financial statements are parts of these financial statements.
THE UNION MOSAIC INDUSTRY PUBLIC COMPANY LIMITED
STATEMENTS OF RETAINED EARNINGS
FOR THE THREE MONTHS ENDED MARCH 31, 2000 AND 1999
UNAUDITED/REVIEWED ONLY
2000 Baht 1999
(Adjustment)
Unappropriated retained earnings (deficit)
Beginning balance (599,743,787.68) (297,326,951.45)
Cumulative effects from change in accounting policy (note 24) 0.00 (4,860,947.06)
Beginning retained earnings (deficit) after adjustments (599,743,787.68) (302,187,898.51)
Less Net profit (loss) for the period (63,376,477.07) (106,546,701.30)
Total unappropriated retained earnings (deficit) (663,120,264.75) (408,734,599.81)
Appropriated retained earnings (deficit) 32,000,000.00 32,000,000.00
Total retained earnings (deficit) (631,120,264.75) (376,734,599.81)
Notes to financial statements are parts of these financial statements.
THE UNION MOSAIC INDUSTRY PUBLIC COMPANY LIMITED
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2000 AND 1999
UNAUDITED/REVIEWED ONLY
2000 Baht 1999
(Adjustment)
Cash flows from operating activities
Net profit (loss) (63,376,477.07) (106,546,701.30)
Items to reconcile net profit to cash receipt (disbursement) from operating activities
Depreciation 46,722,935.98 43,575,309.60
Amortization of other assets 434,674.87 36,091.38
Unappropriated net (gain) loss of associated companies (299,997.11) 237,344.01
Unrealized (gain) loss on exchange rate 4,705,725.65 21,302,378.31
Unrealized (gain) from increment of investments in common share 0.00 (170,400.00)
Profit from operations before changes in operating assets and liabilities (11,813,137.68) (41,565,978.00)
Changes in operating assets (increase) decrease
Short - term investments 0.00 10,053,842.96
Accounts and notes receivable (62,858,545.09) (15,049,794.63)
Short - term loans 0.00 4,929.00
Inventories 89,104,592.35 75,441,478.07
Deposits (455,850.00) (16,119.50)
Other current assets 3,596,561.17 (732,019.02)
Other assets (21,912.00) 308,333.34
Changes in operating liabilities increase (decrease)
Accounts payable (30,030,942.17) 9,469,338.57
Accrued expenses (9,188,441.41) 4,559,004.07
Other current liabilities 4,613,249.70 4,732,471.97
Net cash provided by (used in) operating activities (17,054,425.13) 47,205,486.83
Cash flows from investing activities
Cash paid for property, plant and equipment (4,746,096.89) (2,223,906.82)
Net cash provided by (used in)investing activities (4,746,096.89) (2,223,906.82)
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2000 Baht 1999
(Adjustment)
Cash flows from financing activities
Bank overdrafts and loans from banks increase (decrease) 24,165,641.08 (40,306,913.39)
Net cash provided by (used in) financing activities 24,165,641.08 (40,306,913.39)
Cash and cash equivalents increase (decrease) 2,365,119.06 4,674,666.62
Cash and cash equivalents items at January 1, 7,997,908.06 687,153.00
Cash and cash equivalents items at December 31, 10,363,027.12 5,361,819.62
Supplemental disclosures of cash flow information :
1. Cash paid during the year for :
Interest expenses 36,311,811.82 38,672,453.68
2. For the purpose of preparing the statement of cash flow, cash and cash equivalent items include cash in hand and
cash at banks which are due within 3 months.
Notes to financial statements are parts of these financial statements.
THE UNION MOSAIC INDUSTRY PUBLIC COMPANY LIMITED
NOTES TO FINANCIAL STATEMENTS
AS AT MARCH 31, 2000 AND 1999 (UNAUDITED/REVIEWED ONLY)
AND DECEMBER 31, 1999 (AUDITED)
1. EFFECT OF ECONOMIC CRISIS
In 1997, Thailand and overall Asia Pacific countries have encountered economic crisis resulting from the currency
devaluation and economic slowdown. The real estate business has been adversely affected. The company's sales has
dramatically dropped. The financial statement of the company as at March 31, 2000 and December 31, 1999 has the excess
of current liabilities over current assets of Baht 911,081,826.24 and amount of Baht 635,509,329.02, respectively. However,
the company has been solving these problems and expected to continue its operation as a going concern. These financial
statements reflect the assessment of the company's current status. In addition, the uncertainties, which cannot be presently
determined, may have affect to the financial statements in the foreseeable future.
2. FINANCIAL STATEMENTS PREPARATION BASIS
The accompanying financial statements have been prepared in conformity with the Department Regulation of the
Ministry of Commerce no. 7 (B.E. 2539) dated October 25, 1996, regarding the form of balance sheets and statements of
income for the Public Company Limited and conformed with the generally accepted accounting principles of Thailand.
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
3.1 Revenues and Expenses Recognition
Revenues and expenses are recorded on an accrual basis. Revenue from sales are recognized as revenue when the
delivery of good is made.
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