NTERIM F/S AND CONSOLIDATED OF Q3/1997

11. (a) Bank guarantees As at September 30, 1997, the banks have given guarantees on behalf of the company and its subsidiaries as follows: The company only The consolidation (Baht'000) (Baht'000) Electricity 29,232 29,659 Sales of liquor and cigarettes 1,888 1,918 Others 480 2,180 31,600 33,757 Unaudited Reviewed Siam Makro Public Company Limited Page 12 Notes to the financial statements and consolidated financial statements - September 30, 1997 continued (b) Lease agreement The company has entered into several land lease agreements with a subsidiary company and several building area lease agreements with external lessors. In addition, the subsidiary companies have also entered into building area lease agreements with external lessors. The future payments to which the company and its subsidiaries are committed under these agreements are as follows : The company only The consolidation (Baht'000) (Baht'000) Due within 1 year 276,490 57,600 Due after 1 year but within 5 years 257,030 124,873 Due after 5 years 286,679 360,480 820,199 542,953 (c) Capital expenditure commitment As at September 30, 1997, the company and its subsidiaries have capital expenditure commitments in respect of the construction contracts and the purchase of fixed assets as follows: The company only The consolidation (Baht'000) (Baht'000) Capital expenditure commitments 129,454 223,497 (d) Purchases commitment As at September 30, 1997, the company is committed for the purchases of import products with the domestic purchase agents amounting to Baht 70 million. Unaudited Reviewed Siam Makro Public Company Limited Page 13 Notes to the financial statements and consolidated financial statements - September 30, 1997 continued Financial instruments 12. The company's policy on risk management of liabilities in foreign currencies is to use financial instruments purchased in the financial markets. For hedging purposes, the company has entered into forward exchange contracts to cover loan and purchase commitment in foreign currencies. As at September 30, 1997, deferred hedging cost arising under these contracts amounted to Baht 29 million. Segmental information by business activities 13. The consolidation-For the third quarter Wholesale and Service Land Rental Elimination Total Retail Business Business Business (Million Baht) (Million Baht) (Million Baht) (Million Baht) (Million Baht) Sales - Unaffiliated customers 8,401 157 - - 8,558 - Subsidiary companies - - - - - 8,401 157 - - 8,558 Gross profit 678 30 - - 708 Other income 166 Selling and administrative expenses (631) Interest expenses (8) Directors' remuneration - Income tax (74) Net income 161 Share of loss from an associated company (7) Net income 154 Unaudited Reviewed Siam Makro Public Company Limited Page 14 Notes to the financial statements and consolidated financial statements - September 30, 1997 continued The consolidation-For the period of 9 months Wholesale and Service Land Rental Elimination Total Retail Business Business Business (Million Baht) (Million Baht) (Million Baht) (Million Baht) (Million Baht) Sales - Unaffiliated customers 23,497 426 - - 23,923 - Subsidiary companies 231 - - (231) - 23,728 426 - (231) 23,923 Gross profit 2,079 87 - - 2,166 Other income 468 Selling and administrative expenses (1,805) Interest expenses (22) Directors' remuneration (1) Income tax (264) Net income 542 Share of loss from an associated company (15) Net income 527 Property, plant and equipment, net as at September 30, 1997 5,183 275 2,790 - 8,248 Other assets 5,558 Total assets as at September 30, 1997 13,806 Unaudited Reviewed Siam Makro Public Company Limited Page 15 Notes to the financial statements and consolidated financial statements - September 30, 1997 (continued) The company and its subsidiary companies operate 3 major businesses as follows : - Wholesale business of merchandise and retail business of office supplies. - Automotive service centers and gas stations - Land lease business Sales to unaffiliated customers are presented at market price. The transfer price for sales to subsidiary companies are established by agreement between the company and its subsidiary companies. Property, plant and equipment of each business are for its own operations. Other assets mainly comprise cash in hand and at banks, inventories, amounts due from and loans to affiliated companies. Comparative figures 14. As a result of reclassifications of certain items of interim financial statements ended September 30, 1997, the comparative figures have been amended accordingly. Auditors' report page 1.