ONSOLIDATED FINANCIAL STATEMENTS QUARTER 1/1999

10 พฤษภาคม 2542
Unaudited Reviewed Siam Makro Public Company Limited Page 19 Notes to the financial statements and consolidated financial statements 31 March 1999 continued Segmental information by business activity The consolidation 15. for the three-month period ended 31 March 1999 Wholesale Land and Retail Service Rental Elimi- Total Business Business Business nation (Million (Million (Million (Million (Million Baht) Baht) Baht) Baht) Baht) Sales and service income - Unaffiliated customers 7,378 223 - - 7,601 - Intercompany 1 - 70 (71) - 7,379 223 70 (71) 7,601 Gross profit 600 44 - - 644 Other income 188 Selling and administrative expenses (628) Interest expenses (5) Directors' remuneration (1) Income tax (63) Net income 135 Property, plant and equipment, Net book value as at 31 March 1999 5,715 384 2,790 - 8,889 Other assets 5,059 Total assets at 31 March 1999 13,948 The consolidation for the three-month period ended 31 March 1998 Wholesale Land and Retail Service Rental Elimi - Total Business Business Business nation (Million (Million (Million (Million (Million Baht) Baht) Baht) Baht) Baht) Sales and service income - Unaffiliated customers 7,708 186 - - 7,894 - Intercompany - - 68 (68) - 7,708 186 68 (68) 7,894 Gross profit 649 34 - - 683 Other income 184 Selling and administrative expenses (648) Interest expenses (9) Directors' remuneration (1) Income tax (71) Net income 138 Property, plant and equipment, Net book value as at 31 March 1998 5,359 400 2,790 - 8,549 Other assets 5,178 Total assets at 31 March 1998 13,727 The company and its subsidiary companies operate 3 major businesses as follows : - Cash and carry trade center of food and non food products and retail business of office supplies. - Automotive service centers and gas stations. - Land investment and property leasing. Sales to unaffiliated customers, subsidiary and affiliated companies are presented at market price. Property, plant and equipment of each business are for its own operations. Otherassets mainly comprise cash in hand and at banks, inventories, amounts due from affiliated companies, pre-openning and start-up expenses, deposits and other assets. Unaudited Reviewed Siam Makro Public Company Limited Page 20 Notes to the financial statements and consolidated financial statements 31 March 1999 continued Year 2000 issues (unaudited and not covered by the auditors report) 16. Siam Makro Public Company Limited and its subsidiary companies commenced their plan to replace and upgrade all major computer systems at the end of 1997. This aims to increase the efficiency and ability to cope with business growth. The upgrades for the finance and accounting systems have already been completed and passed for year 2000 compliance test. The company and its subsidiary companies are now in the process of upgrading the business operating systems in respect of purchasing, selling, goods receiving and inventory management, which are expected to be completed and ready for year 2000 compliance test within 1999. The capital expenditure budget of the company is estimated at Baht 120 million out of which Baht 40.8 million has been capitalized to fixed assets as at 31 March 1999. The total capital expenditure of the company and its subsidiary companies is estimated at Baht 168 million. The company and its subsidiary companies expect that such upgrades should remove any year 2000 problems as the new equipment and applications are year 2000 compliant, as certified by the vendors. The company expects that the year 2000 compliance test will be finished within the second quarter of 1999 and the subsidiary companies are expected to finished testing within the fourth quarter of 1999. In addition, the company and its subsidiary companies are proactively addressing the issue in respect of other companies, with which the company and its subsidiary companies are doing business, in order to ensure year 2000 compliance. The company is in the process of examining the readiness for year 2000 compliance of such companies. This information will be used for preparing an assessment of the impact to the company and its subsidiary companies and also for developing a plan to minimize the business risks. This plan is expected to be finished in June 1999. Comparative figures 17. As a result of reclassifications of certain items in the financial statements for the three-months period ended 31 March 1999, the comparative figures have been amended accordingly. Auditors report page 1.