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Abbreviation used in 2007 Annual Report ACT ACU ADSL AIL ARS BVI CP CPN DWDM IIG IKSC ISP JCW JAS Ji-NET JIOC JSS JSTC JTS JasTel MCS MPLS NTU PA PP PRE SHW STCC TJP TKSC TLDT TT&T TTN TTTBB TTTI VOIP VPN NTC NBC CAT TOT Rehabilitation Plan Plan Administrator

= = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = =

ACeS (Thailand) Company Limited Acumen Company Limited Asymmetric Digital Subscriber Line ACeS International Limited ACeS Regional Services Company Limited Clippership Investments (BVI) Limited Chaengwatana Planner Company Limited Compunet Corporation Limited Dense Wavelength Division Multiplexing International Internet Gateway Internet Knowledge Service Center Company Limited Internet Service Provider Jasmine Cyberworks Company Limited Jasmine International Public Company Limited Jasmine Internet Company Limited Jasmine International Overseas Company Limited Jasmine Smart Shop Company Limited Jasmine Submarine Telecommunications Company Limited Jasmine Telecom Systems Public Company Limited JasTel Network Company Limited Mobile Communication Services Company Limited Multiprotocol Label Switching NTU (Thailand) Company Limited Premium Assets Company Limited Pakkred Planner Company Limited Premium Real Estate Company Limited Smart Highway Company Limited Siam Teltech Computer Company Limited T.J.P. Engineering Company Limited Telecom KSC Company Limited Thai Long Distance Telecommunications Company Limited TT&T Public Company Limited Thailand Training Network Triple T Broadband Public Company Limited Triple T Internet Company Limited Voice Over Internet Protocol Virtual Private Network The National Telecommunications Commission The National Broadcasting Commission CAT Telecom Public Company Limited TOT Public Company Limited Rehabilitation plan of Jasmine International Public Company Limited or Jasmine International Overseas Company Limited, as the case may be = Chaengwatana Planner Company Limited as the plan administrator of Jasmine International Public Company Limited or Pakkred Planner Company Limited as the plan administrator of Jasmine International Overseas Company Limited, as the case may be A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

1


Contents General Information

2

Shareholding of the Company

3

References

6

Financial Summary

7

Report from the Board of Directors

8

Nature of Business

10

Revenue Structure of the Company, Subsidiaries and Associated Companies

12

Significant Changes in the Year 2007

13

Social Activities and Contribution

15

Risk Factors

16

Prospects of Telecommunications Business in the Year 2008

19

Shareholding Structure

21

Management

22

Related Party Transactions

52

Management Explanation and Operation Results Analysis

54

The Responsibility for the Financial Reporting of the Board of Directors

61

Audit Committee Report

62

Report of Independent Auditor

63

Consolidated Financial Statements

65

Notes to Consolidated Financial Statements

75

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

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General Information Details of the Company Company Name : Jasmine International Public Company Limited Registration Number : 0107537000106 Address of Head Office : 200, 29th-30th Fl., Moo 4, Chaengwatana Road, Pakkred Sub-district, Pakkred District Nonthaburi 11120 Tel. : (66) 0-2100-3000-7 Fax : (66) 0-2100-3150-2 URL : http://www.jasmine.com Sector Name : Information and Communication Technology (ICT)

Total Amount and Type of Issued Share Registered ordinary share Paid-up ordinary share Par Value Total

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A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

15,685,673,420 8,319,907,163 1 8,319,907,163

Shares Shares Baht Baht


Shareholding of the Company Company name and address of head office

Nature of business

Paid-up capital Amount (Shares)

Shareholding of the Company Amount Percentage of (Shares) shareholding

Amount and type of share the Company held in the subsidiary/associated companies. 1. Network and Service Provider 1.1 The company whose shares are held by JAS : Jasmine Submarine Telecommunications Co., Ltd. Engages in submarine 15,500,000 15,499,994 optical fiber 200, 7th Fl., Moo 4, Chaengwatana Rd., Pakkred Sub-district, Pakkred District, Nonthaburi 11120 cable network service Tel: 0-2100-3183 Fax: 0-2100-3184 Acumen Co., Ltd. Engages in satellite 7,600,000 7,599,994 telecommunications 200, 7th Fl., Moo 4, Chaengwatana Rd., Pakkred Sub-district, Pakkred District, Nonthaburi 11120 services Tel: 0-2100-3000 Fax: 0-2100-3222 Jasmine Internet Co., Ltd. Engages in Internet 1,500,000 975,000 200, Moo 4, Chaengwatana Rd., Pakkred Service Sub-district, Pakkred District, Nonthaburi 11120 Tel: 0-2100-3700 Fax: 0-2100-3793 1.2 The company whose shares are held by JAS没 subsidiary : Thai Long Distance Telecommunications Co., Ltd. Engages in submarine optical 30,900,000 27,809,993 200, Moo 4, Chaengwatana Rd., Pakkred fiber cable network service Sub-district, Pakkred District, Nonthaburi 11120 Tel: 0-2100-3183 Fax: 0-2100-3184 JasTel Network Co., Ltd. Engages in circuit 2,200,000 2,199,993 leasing service and local 200, 7th Fl., Moo 4, Chaengwatana Rd., Pakkred Sub-district, Pakkred District, Nonthaburi 11120 as well as international Tel: 0-2100-3183 Fax: 0-2100-3184 data communications service Smart Highway Co., Ltd. Engages in the Non-Plain 1,550,000 1,044,693 200, Moo 4, Chaengwatana Rd., Pakkred Old Telephone Service Sub-district, Pakkred District, Nonthaburi 11120 (Non-POTS) Tel: 0-2100-3000 Fax: 0-2100-3222 Triple T Broadband Public Co., Ltd. Engages in fixed-line telephone 110,000,000 99,999,410 200, Moo 4, Chaengwatana Rd., Pakkred service and the provision of Sub-district, Pakkred District, Nonthaburi 11120 data communications service to Tel: 0-2100-2100 Fax: 0-2100-2121 organizations and individual customers nationwide Triple T Internet Co., Ltd. Engages in the Internet 10,000 9,993 200, Moo 4, Chaengwatana Rd., Pakkred Service providing Internet Sub-district, Pakkred District, Nonthaburi 11120 and applications Tel: 0-2100-2100 Fax: 0-2100-2121 ACeS Regional Services Co., Ltd. Engages in satellite mobile 102,000,000 99,999,993 200, Moo 4, Chaengwatana Rd., Pakkred phone service both Sub-district, Pakkred District, Nonthaburi 11120 in Thailand and the neighboring Tel: 0-2100-3000 Fax: 0-2100-3416 countries 2. System Integration 2.1 The company whose shares are held by JAS : Jasmine Telecom Systems Public Co., Ltd. Engages in the design and 702,000,000 399,997,200 200, 9th Fl., Moo 4, Jasmine International Tower, installation of equipment and Chaengwatana Rd., Pakkred Sub-district, system testing for Pakkred District, Nonthaburi 11120 telecommunications projects Tel: 0-2100-8300 Fax: 0-2502-3363

100

100

65

90 (Held by JSTC) 100 (Held by JSTC) 67.40 (Held by ACU) 90.91 (Held by ACU)

99.93 (held by TTTBB) 98.04 (Held by ACT)

56.98

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

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Company name and address of head office

Nature of business

2.2 The company whose shares are held by JAS没 subsidiary : Siam Teltech Computer Co., Ltd. Engages in computer system 200, 10th Fl., Moo 4, Chaengwatana Rd., Pakkred integration, software Sub-district, Pakkred District, Nonthaburi 11120 development and computer Tel: 0-2100-3000 Fax: 0-2100-3501 product distribution Jasmine Telecom Systems Public Co., Ltd. Engages in the design and 200, 9th Fl., Moo 4, Jasmine International Tower, installation of equipment and Chaengwatana Rd., Pakkred Sub-district, system testing for Pakkred District, Nonthaburi 11120 telecommunications projects Tel: 0-2100-8300 Fax: 0-2502-3363 3. Other Interests 3.1 The company whose shares are held by JAS : Jasmine International Overseas Co., Ltd. Engages in the investment 200, Moo 4, Chaengwatana Rd., Pakkred in telecommunications Sub-district, Pakkred District, Nonthaburi 11120 companies in Thailand Tel: 0-2100-3000 Fax: 0-2100-3152 and foreign countries Chaengwatana Planer Co., Ltd. Engages in the plan 200, 29th -30th Floor, Moo 4, Chaengwatana Rd., administration of Pakkred Sub-district, Pakkred District, Nonthaburi 11120 Jasmine International Tel: 0-2100-3000 Fax: 0-2100-3150-1 Public Co., Ltd. TT&T Public Co., Ltd. Operates a 1.5-million 252/30-34 Muang Thai-Phatra Office Tower 1, telephone-line project in Huaykwang Sub-district, Huaykwang District, Bangkok 10310 the provincial area Tel: 0-2693-2100 Fax: 0-2693-2124 Internet Knowledge Service Center Co., Ltd. Engages in information and 2/4, 10th Fl., Siam Commercial Samaggi Insurance Internet network Tower, Vibhavadi Rungsit Road, Thungsonghong system services Sub-district, Laksi District, Bangkok 10210 Tel: 0-2955-0099 Fax: 0-2955-0300 3.2 The company whose shares are held by JAS没 subsidiary : Premium Assets Co., Ltd. Engages in space rental 200, Moo 4, Chaengwatana Rd., Pakkred management and related Sub-district, Pakkred District, Nonthaburi 11120 services for Jasmine Tel: 0-2100-3000 Fax: 0-2100-3575 International Tower ACeS (Thailand) Co., Ltd. Engages in investment 200, Moo 4, Chaengwatana Rd., Pakkred business Sub-district, Pakkred District, Nonthaburi 11120 Tel: 0-2100-3000 Fax: 0-2100-3152 Jasmine International Overseas Co., Ltd. Engages in the investment 200, Moo 4, Chaengwatana Rd., in telecommunications Pakkred Sub-district, Pakkred District, companies in Thailand Nonthaburi 11120 and foreign countries Tel: 0-2100-3000 Fax: 0-2100-3152 Pakkred Planner Co., Ltd. Engages in the plan 200, 29th -30th Floor, Moo 4, Chaengwatana Rd., administration of Jasmine Pakkred Sub-district, Pakkred District, Nonthaburi 11120 International Overseas Tel: 0-2100-3000 Fax: 0-2100-3150-1 Co., Ltd. TT&T Public Co., Ltd. Operates a 1.5-million 252/30-34 Muang Thai-Phatra Office Tower 1, telephone-line project Huaykwang Sub-district, Huaykwang District, in the provincial area Bangkok 10310 Tel: 0-2693-2100 Fax: 0-2693-2124

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A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

Paid-up capital Amount (Shares)

Shareholding of the Company Amount Percentage of (Shares) shareholding

550,000

538,264

97.87 (Held by JTS)

702,000,000

60,000,000

8.55 (Held by TJP)

11,538,463

4,594,134

39.82

10,000

9,993

100

3,242,484,261 810,269,147

24.99

12,000,000

4,500,000

130,000,000

69,999,993

11,538,463

3,994,325

10,000

9,993

37.50

53.85 (Held by ACU) 60,000,000 46.15 (Held by JSTC) 195,000,000 114,742,696 58.84 (Held by JIOC) 34.18 (Held by ACT) 3,000,000 26.00 (Held by ARS)

3,242,484,261 141,360,677 6,324,048 5,634,601 3,904,132 247,607

100 (Held by JIOC) 4.36 (Held by JSTC) 0.20 (Held by JTS) 0.17 (Held by STCC) 0.12 (Held by TJP) 0.01 (Held by ACU)


Company name and address of head office

Nature of business

Dormant Company ë The company whose shares are held by JAS : T.J.P. Engineering Co., Ltd. Engages in the survey, design, 200, 10th Fl., Moo 4, Chaengwatana Rd., Pakkred and construction of the outside Sub-district, Pakkred District, Nonthaburi 11120 plant and civil work for Tel: 0-2100-3000 Fax: 0-2100-3152 telecommunications projects Jasmine Smart Shop Co., Ltd. Engages in telecom 200, Moo 4, Chaengwatana Rd., Pakkred equipment retail business Sub-district, Pakkred District, Nonthaburi 11120 Tel: 0-2100-3000 Fax: 0-2100-3151 Mobile Communication Services Co., Ltd. Engages in the 200, Moo 4, Chaengwatana Rd., Pakkred NMT 470 MHz. Cellular Sub-district, Pakkred District, Nonthaburi 11120 Mobile Telephone Service Tel: 0-2100-3000 Fax: 0-2100-3152 Jasmine Cyberworks Co., Ltd. Engages in Internet and e-commerce businesses 200, 11th Fl., Moo 4, Chaengwatana Rd., Pakkred Sub-district, Pakkred District, Nonthaburi 11120 Tel: 0-2100-3678 Fax: 0-2100-3679 Compunet Corporation Limited Engages in the local 200, Moo 4, Chaengwatana Rd., Pakkred transmission of data, pictures, Sub-district, Pakkred District, Nonthaburi 11120 and voices via satellite Tel: 0-2100-3800 Fax: 0-2100-3810 Telecom KSC Co., Ltd. Engages in the distribution 2/4 10th Fl.,Siam Commercial Samaggi Insurance of computer, telecommunications Tower, Vibhavadi Rungsit Rd., Thungsonghong equipment, and software Sub-district, Laksi District, Bangkok 10210 Tel: 0-2955-0099 Fax: 0-2955-0300 Premium Real Estate Co., Ltd. Engages in the real 200, Moo 4, Chaengwatana Rd., Pakkred estate business Sub-district, Pakkred District, Nonthaburi 11120 Tel: 0-2100-3000 Fax: 0-2100-3575 Palang Thai Kaowna Co., Ltd. Engages in power 2034/132-161 New Petchburi Road., plant business Kwaeng Bangkapi,Khet Huaykwang, Bangkok 10310 Tel: 0-2716-1600-700 Fax: 0-2716-1418 Khunka Palang Thai Co., Ltd. Engages in power 2034/132-161 New Petchburi Road., Kwaeng plant business Bangkapi,Khet Huaykwang, Bangkok 10310 Tel: 0-2716-1600-700 Fax: 0-2716-1418 Palit Palangngan Co., Ltd. Engages in power 2034/132-161 New Petchburi Road., plant business Kwaeng Bangkapi,Khet Huaykwang, Bangkok 10310 Tel: 0-2716-1600-700 Fax: 0-2716-1418 ë The company whose shares are held by JASû subsidiary : T.J.P. Engineering Co., Ltd. Engages in the survey, design, 200, Moo 4, Chaengwatana Rd., Pakkred and construction of the outside Sub-district, Pakkred District, Nonthaburi 11120 plant and civil work for Tel: 0-2100-3000 Fax: 0-2100-3152 telecommunications projects

Paid-up capital Amount (Shares)

Shareholding of the Company Amount Percentage of (Shares) shareholding

2,000,000

1,600,000

80

1,100,000

1,099,993

100

10,000,000

6,999,993

70

5,200,000

5,199,993

100

2,600,000

2,599,994

100

100,000

40,000

40

8,200,000

4,018,000

49

10,000

2,308

23.08

10,000

2,308

23.08

10,000

1,500

15

2,000,000

399,995

20 (Held by ACU)

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

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References Name, Office Address and Telephone Number of other Reference Persons Registrar

Auditor

: Thailand Securities Depository Co., Ltd. The Stock Exchange of Thailand Building, 4th Floor, 62 Rachadapisek Road, Klongtoey Sub-district, Klongtoey District, Bangkok 10110 Tel. : 0-2229-2800,0-2654-5599 Fax : 0-2359-1259 : Mr.Supachai Phanyawattano The Certified Public Accountant没s License No. 3930 or Ms. Thipawan Nananuwat The Certified Public Accountant没s License No. 3459 or Miss Siraporn Ouaanunkun The Certified Public Accountant没s License No. 3844 Ernst&Young Office Limited 33rd Floor, Lake Rajada Office Complex, 193/136-137 New Rajadapisek Road, Bangkok 10110 Tel. : 0-2264-0777, 0-2661-9190 Fax : 0-2264-0789-90, 0-2661-9192

Legal Advisor

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A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

: Hunton & Williams (Thailand) Limited 34th Floor, Q. House Lumpini Building 1 South Sathorn Road, Thungmahamek, Sathorn, Bangkok 10120 Thailand Tel. : 0-2645-8800 Fax : 0-2645-8880


Financial Summary 2007 Progression (Thousand Baht) Sales and Service Income Total Revenues Cost of Sales and Services & Selling Expenses Gross Profit Sharing Profit (Loss) From Associated Company Net Earnings (Loss) Total Assets Total Liabilities Shareholders没 Equity Financial Ratio Net Profit Margin Return on Total Asset Return on Equity Per Share Data (Baht) Net Earnings (Loss) per Share No. of Share (share) Book value Par value

2006

2005

4,330,726 4,632,947 4,294,022 1,771,668 (644,670) (41,426) 14,979,427 6,142,246 8,837,181

5,275,068 5,848,047 5,016,537 2,137,269 (390,582) 236,179 17,440,071 8,032,901 9,407,169

6,655,034 6,911,044 5,509,285 2,876,683 (507,071) 864,590 16,600,614 8,113,699 8,486,915

(0.89) (0.26) (0.45)

4.04 1.39 2.64

12.51 5.13 10.84

(0.005) 8,319,907,163 1.06 1.00

0.028 8,319,907,163 1.13 1.00

0.100 8,319,877,163 1.02 1.00

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

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Report from the Board of Directors Dear Shareholders, The September 2006 political change caused the Thai politics and economy to have uncertain directions and turn stagnant throughout the year 2007. Business operators of all sectors were affected either directly or indirectly to a certain degree. Moreover, the Subprime crisis of the United States of America also led the previous year finance market as well as the capital market to liquidity problem. Several mega-projects of the government and the private sectors were delayed partly due to the loan problem. No wonder, the continually rising oil price which significantly affected both the production and transportation also pushed higher the prices of goods and services. Realizing such problems, the present government has set up a policy to support financial and investment sectors by adding and amending the regulations in many related areas to enable both the government and private agents to further expand their businesses and investments in new projects. Regarding the Company没s and the subsidiaries没 business operation results of the year 2007, we are pleased to acknowledge all the shareholders as follows : the revenue of the Company and its subsidiaries amounted to Baht 4,633 Million, decreasing from the year 2006 by Baht 1,215 Million or 21% and have net loss in this year equaled to Baht 41 Million, decreasing from the year 2006 by Baht 277 Million. The Company and its subsidiaries had total assets of Baht 14,979 Million, decreasing from the year 2006 by Baht 2,460 Million or 14%, and total liabilities of Baht 6,142 Million, decreasing from the year 2006 by Baht 1,891 Million or 24%. The decrease in the business operation results of Jasmine International Group is a consequence of the aforementioned negative factors which can be seen from the fact that the subsidiary and affiliated companies namely, Jasmine Telecom Systems Public Co., Ltd. and Siam Teltech Computer Co., Ltd. respectively, whose main business involves in government bidding projects, gained less operation results due to the postponement of the government project bidding.

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A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited


However, we, Jasmine International Group, still has a strong intention to keep expanding our telecommunications business with confidence that the Company has been well versed in this field of business for a long time. Besides, our existent personnel also are well equipped with the telecom knowledge, expertise and experiences. In response to the customers没 demand, the Company has researched and introduced cutting edge technologies to enhance business efficiency. Apart from the emphasis on business development, Jasmine International Group also accentuates the importance of social contribution. So, it always joins activities of many organizations for social development and the better living condition of the Thai people. Last but not least, the Company upholds good corporate governance policy as an essential guideline for business operation for the sustainable growth and development of the business and the nation. Lastly, the Board of Directors would like to thank all the shareholders for valuable trust. We also thank our customers, partners, financial institutes as well as government and private organizations for the kind support. And thanks to the executives and employees of the Company who have dedicated their knowledge and capability for a good outcome. Please be ensured that the Board of Directors will keep the best effort in conducting the Company没s business with the intention to bring the maximum benefit to the shareholders and the related-parties as a contribution to all of us as well as to the society as a whole. General Tienchai Sirisumpan Honorary Chairman

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

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Nature of Business Jasmine International Public Co.,Ltd., is a leading telecommunications company of Thailand offering all services of telecommunications locally and internationally i.e. terrestrial, airy and submarine. The Company invested in telecommunications network and provide the service through such network as Internet broadband network, WiFi Hotspot, submarine fibre-optic cable and satellite-based network using modern technology for data and multimedia communications nationwide. Besides, the Company also provides procurement, design, installation of telecommunications system and computer system integration. The Company has been awarded to construct several significant projects for government and private sectors. Presently, the Company realizes the new trend of modern technology especially the broadband Internet, which dynamically change and widely used globally. This kind of business is expected to make a good revenue and profit in a short time, so, the Company has emphasized itself as the service provider of the broadband Internet. The Company invested in the businesses that have various products and services which support each other by using its existing capacious networks and professional team that contribute to the business operation result. The Company’s business lines are distinctly categorized by products and services in order to enhance operational effectiveness and transparency in each subsidiary and also to prevent any future conflict of interest to bring about the optimum benefit of business operation of the group as a whole. The Company, as a holding company, has invested in telecommunications and information technology business categorized as follows :

1. Network & Service provider This area of business comprises the network provider i.e. Submarine Optical Fiber network provider and telecom service provider i.e. satellite-based communications, the broadband Internet and satellite mobile phone service providers. Placed in this business category are the following subsidiaries: • Jasmine Submarine Telecommunications Co., Ltd. and Thai Long Distance Telecommunications Co., Ltd. which provide Submarine Optical Fiber Cable System service on the east coast (Gulf of Thailand) and the west coast (Andaman Sea) of Thailand. • JasTel Network Co., Ltd. which provides high-speed leased circuit via the cable network for data transfer in addition to the IP-VPN service and the Managed Network service via optical fiber network and copper wire network for both domestic and international clients who are operators, telecom service providers and enterprises.

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A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited


• Triple T Broadband Public Co., Ltd. which provides fixed-line telephone service and data communications, including Broadband Internet service. Its subsidiary, Triple T Internet Co., Ltd, is an Internet Service Provider offering full range of the Internet-related service and applications to both residential and corporate clients. • Acumen Co., Ltd. which in addition to providing the service of Wi-Fi Internet also provides Internet service and telecommunications service via satellite network together with other Internet related services to the individuals, corporations, as well as private and state agents • Jasmine Internet Co., Ltd. which provides commercial Internet service and operates it under the Ji-NET brand. For both individual and corporate clients, the company has provided such wide ranges of services as leased-line Internet, broadband Internet and data center. It also provides the Branch Connext service -- the network connection service via ADSL network, VOIP service (Voice Over Internet Protocol) and international calling card service. Furthermore, the company has provided the consultation, design and procurement services, regarding IP Solution such as the Online service via GPRS/CDMA, IP Camera, Wifi Hot Spot and so on. • ACeS Regional Services Co., Ltd. which provides satellite mobile phone service under the ACeS Cellular Satellite project for Thailand and several countries in Asia. The ACeS service, of which its signal (footprint) is well transmitted at all time everywhere even in such remote areas as deep jungles and far offshore, is currently available in 24 countries of Asia in both the post-paid and pre-paid forms. The ACeS handset is of a dual mode system-roaming between a satellite mode and GSM 900 mode for Thailand’s and Asian regions’ markets, enhancing for its clients further communication convenience. Moreover, it offers “ACeS Contax” -a fixed satellite phone service of the latest technology which is designed for indoor use in remote areas and in some countries where basic telecommunications is needed. • Smart Highway Co., Ltd. which, besides high-speed data communications service via leased line, provides the service of rental and installation of Customer Premise Equipment.

2. System Integration This group of business engages in the supply, design and integration of telecommunications system and computer network and other related equipment. The subsidiaries categorized in this business line are : • Jasmine Telecom Systems Public Co., Ltd. which provides turn-key telecommunications business, ranging from system design and integration to the distribution of communications devices, testing equipment and security system. It also leases public payphones to TOT Public Co., Ltd. Jasmine Telecom Systems Public Co., Ltd. was registered in the Stock Exchange of Thailand in February, 2006 and later on, listed in the Stock Exchange of Thailand on September 18, 2006. • Siam Teltech Computer Co., Ltd. which engages in computer system design and integration, including software development. It also is a distributor of the peripheral computer equipment.

Besides the above 2 core business lines, the Company invests in other businesses as follows : • TT&T Public Co., Ltd. which provides fixed-line telephone and public telephone services in the provincial area. • Jasmine International Overseas Co., Ltd., a holding company, investing in overseas business. • Premium Assets Co., Ltd. which engages in space rental and related services for Jasmine International Tower. A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

11


Revenue Structure of the Company, Subsidiaries and Associated Companies Unit : Million Baht

Nature of Business The Company and Subsidiaries Network and Telecommunication Service Provider

Total System Integration

Operated by (abr.)

% of Shares Held by JAS

JSTC TLDT JasTel ACU SHW TTTBB ARS Ji-NET

100.00 90% held by JSTC 100% held by JSTC 100.00 67.40% held by ACU 90.91% held by ACU 98.04% held by ACT 65.00

JTS

56.98% held by JAS and 8.55% held by TJP 97.87% held by JTS 80% held by JAS and 20% by ACU

STCC JAS TJP Total Other Businesses and Investments

JSS JIOC

ACT

100.00 39.82% held by JAS, 34.18% by ACT and 26% by ARS 100.00 70.00 100.00 100.00 16.67% held by JAS and 34.33% by ACU 46.15% held by JSTC and 53.85% by ACU 58.84% held by JIOC

TT&T IKSC(2) TKSC(2) PRE(2)

29.85 37.50 40.00 49.00

CP MCS JCW CPN NTU(1) PA

Total Grand Total Associated Companies Other Businesses and Investments

Grand Total Remarks :

(1) (2)

2007 Revenue %

2006 Revenue %

2005 Revenue %

980.8 329.4 77.7 185.5 61.0 1,230.1 210.5 414.8 3,489.8 728.8

21.17 7.11 1.68 4.00 1.32 26.55 4.54 8.95 75.32 15.73

1,269.5 414.9 1.1 966.4 69.5 285.8 292.8 388.9 3,688.9 1,588.5

21.71 7.09 0.02 16.53 1.19 4.89 5.01 6.65 63.08 27.16

1,149.1 375.1 2,404.7 124.5 270.9 401.4 4,725.7 1,196.2

16.63 5.43 34.80 1.80 3.92 5.81 68.38 17.31

152.7 11.7 75.4

3.30 0.25 1.63

370.4 20.4 46.2

6.33 0.35 0.79

580.9 237.2 38.9

8.41 3.43 0.56

968.6 0.2

20.91 -

3.5 30.4 -

0.08 0.66 -

3.6 9.2 1.5 -

0.06 0.16 0.03 -

0.8 6.2

0.01 0.09

137.5

2.97

92.2

1.58

8.2

0.12

2,025.5 34.64 23.2 0.40 (0.2) -

2,053.2 29.71 116.2 1.68 0.7 0.01

2.9 0.06 174.5 3.77 4,632.9 100.00

4.1 0.07 133.6 2.28 5,848.0 100.00

132.1 1.91 6,911.0 100.00

7,513.4 99.90 7.1 0.09 0.2 7,520.7 100.00

7,723.5 99.78 6.6 0.09 10.2 0.13 7,740.3 100.00

6,690.1 92.32 24.0 0.33 532.4 7.35 7,246.5 100.00

This is not included in the Company Consolidated Financial Statement in 2006 as it was sold on December 29, 2006 by the Company and the subsidiary In 2007, the data was prepared by the management of that Company.

The Company and its subsidiaries have had no comparative proportion between the local and overseas distribution during 2005-2007

12

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited


Significant Changes in the Year 2007 Jasmine International PCL. would like to acknowledge the shareholders of its 2007 significant performances, activities and changes as follows :

Treasury Stock Program for financial management On 28 February 2007, the Board of Directors Meeting of Jasmine International PCL. has approved Treasury Stock Program for financial management in the amount not more than 831,990,715 shares (at par value of 1 Baht per share) or not more than 10% of the total paid-up capital. The maximum amount of the share repurchased will not exceeding 300,000,000 Baht. The Company repurchased its shares in the Stock Exchange of Thailand commencing from 15 March 2007 to 14 September 2007 (6 months). On 14 September 2007, the Company notified the completion of the share repurchase program. The total shares repurchased were 634,400,000 shares or 7.625% of total paid-up capital.

Progression of Business Rehabilitation Plan of the Companyûs Subsidiary After the Central Bankruptcy Courtûs approval of the Business Rehabilitation Plan of Jasmine International Overseas Co., Ltd. (JIOC), a Companyûs subsidiary, on September 30, 2003, JIOCûs Plan Administrators put their efforts to carry out all the tasks set out in the Plan and finally succeeded in completing all the requirements stipulated therein. Therefore, on July 26, 2007 the Central Bankruptcy Court ordered the termination of JIOCûs Rehabilitation proceeding, enabling the Companyûs Board of Directors to resume their power and duties to manage the companyûs business and assets and the shareholders to regain their legal right.

Significant Activities and Changes of the Company and Subsidiaries ë Network and Service Provider Jasmine Internet Co., Ltd. Jasmine Internet Co., Ltd. was granted type 1 license (Licensee without own network) by the National Telecommunication Commission of Thailand for the provision of such Internet services as Broadband (Dialup via ISDN), ADSL Internet, Wifi Internet, Voice over Internet Protocol - servicing only from computer to computer and from computer to fixed line telephone without telephone number --, Electronic Data Interchange service (EDI), Data Center service, Web Hosting, Mail Hosting, Backup server, etc.

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

13


The company also provides the international calling card service under the çThookdeeé brand which by the license granted by NTC enables its users to reach more than a hundred countries of the world. Triple T Broadband PCL. Triple T Broadband PCL., a subsidiary of Acumen Co., Ltd., was registered as a Public Company Limited on September 4, 2007. It established Triple T Internet Co., Ltd. (TTTI) as its subsidiary on May 30,2007. Later, on June 20, 2007 TTTI received type 1 license for Internet service from NTC.

ë Other Interests TT&T PCL. TT&T PCL. has expanded the customer base for data communication service-a service with highly potential growth - and at the same time has gained the income from new businesses allowed by NTCûs license. In the previous year, its subsidiary, Triple T Global Net Co., Ltd. received the Internet service provider license type 2 (Licensee with own network) for International Internet Gateway service (IIG) and National Internet Exchange (NIX) service and the network telecom license type 3 (Licensee with own network) to engage in the International Direct Dialing (IDD) as well as International Private Leased Circuit (IPLC) from NTC. Moreover, another subsidiary, TT&T Subscriber Services Co., Ltd. was given type 1 license for international calling card service from NTC as well.

14

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited


Social Activities and Contribution Jasmine International PCL. has always placed a concern on the society, considering it as an important element of the nation. With a strong aim to contribute and develop the Thai society, it has set up a policy, emphasizing involvement in activities which are beneficial to the public ; for instance, giving support to education of all levels and creative activities of the youth. In addition, it focuses on improving the needy peopleûs living condition. So, it has cooperated with various charity organizations to provide such people with necessary benefits. Apart from this, it consistently gives support to sports and religion. In the year 2007, the Companyûs made several contributions to education. It gave the Sorlaeh Suksa School, Wat Phasuk Maneejakra Mitraphap 116th School and Nandhabhiwat School (Wat Koo) in Nonthaburi financial donations for supporting their Childrenûs Day activities. In addition, it donated the second hand computers to Wat Changyai School in Ayudhaya and as well, it donated the school uniforms to the hill tribe children in the north of Thailand via the Mirror Foundation of Chiang Rai Province. It also supported the çPlazma Z teamé of Chulalongkorn Universityûs Engineering students in robot football competition on World Robocup 2007 in Atlanta, U.S.A. Moreover, it offered chances for senior university students to have a work training prior to their graduation in various departments of its own and the subsidiaries such as Engineering Department, Public Relations Department, Human Resources Department and Information and Technology Department and so on, believing that this would help them to be well prepared and ready for entering the real world of working people with efficiency. For public charity, in the previous year, the Company supported the Thai Red Cross Societyûs project of blood donation by inviting the executives and employees of Jasmine International Group to donate their blood every 3 months. Additionally, the needy were also assisted ; the Company set up the çSecond Hand Salesé project to raise fund for Bangkhae Home for the Aged 1 and 2, Bangkok Metropolis. In term of sports, the Company supported the 15th Traditional Golf Tournament between Chulalongkorn University and Thammasat University, the proceeds of which was presented to Her Royal Highness Princess Maha Chakri Sirindhorn to raise the fund for Anandamahidol Foundation. It also gave a financial donation for the 63rd traditional football match between Chulalongkorn University and Thammasat University in order to promote a sport spirit among students. With the awareness of the importance of religion, last year, the Company regularly held activities on significant religious occasions ; for example, it held a Candle Offering Ceremony for the Buddhist Lent which was participated by many executives and employees with the aim to continue the valuable Thai tradition. Besides, in order to foster religion, it gave donations to the temples. Last year, the Company took the donation given by the employees and other faith-hearted people to Wat Kokten, a needy temple in Suphanburi and Wat Chonpratan Rangsarit in Nonthaburi. In summary, the Company truly has a strong intention to contribute and develop the society to be the solid ground of the country. A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

15


RISK FACTORS 1. Business Operation Risk Factors 毛 Revenue Risks due to the expiration of the concessions and competitions amongst the competitors in the same industry. The Group, under the concessions awarded by the government bodies, has the right to undertake several projects in pertinent to network and service provider, system integration, and other interests which have served as sources for the Group没s core revenue. As the concessions are presently running close to the expiration dates, the revenue sharing conformably decreased. In addition, the higher competitive environment amongst competitors within the same industry, caused by telecommunications liberalization, highlights the risk in revenue to some outstanding extent. Having been well aware of this risk, the Company has sought for new revenue channels to replace the expiring concessions while maintaining the transmission circuit base utilized by TOT PCL. and proposing other alternative network utilization to gain more revenue. As for the service area, the after-sales service has been improved and the Customer Relationship Management (CRM) has been upgraded to differentiate the Group没s efficiency from that of the competitors in order to upkeep the existing customer base while penetrating into other industries for new customers. Responsive pricing measurement has also been initiated to tackle the competition.

毛 Human Resources In telecommunications business, knowledgeable and specialized personnel are required to support the business growth and expansion. However, currently, the telecom business still needs more quality personnel and experts. The liberalization of Thai telecom results in the birth of several new telecom operators which consequently causes an extensive turnover rate of quality personnel, who once leave the Company cannot be properly replaced by some of the rest personnel who are not knowledgeable, competent and skilful enough. The Company; therefore, has set up measures and means to manage the risk by recruiting skilled personnel, initiating the personnel development plan by arranging training courses in alignment with the business plan of the Company, learning basic technological know-how from product suppliers, defining clear work system for better comprehensibility, setting up a clear personnel replacement plan as well as career path plan, and develop the Company environment for new knowledge perception.

16

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited


ë Laws and Politics Laws regarding the telecommunications operation issued by the National Telecommunication Commission of Thailand (NTC) can create risks to the Company. For examples, the issue of new regulations regarding such new technologies as Wimax or 3G, and the launch of Interconnection Charge result in higher service costs. However, the Company has not only kept a close look on new regulations to be issued with emphasis on the issues that will directly cause crucial impact to the Company, but also kept cooperating with NTC in sharing comments for smooth business running in compliance with NTCûs regulations. Regarding the disputes between TOT PCL. and the company held by the Companyûs subsidiaries, the counter-parties, over the leased line service, the Company has consulted with its legal consulting firm for proper suggestions as well as impact and damage assessment before negotiating with TOT PCL. for mutual conclusion. ë Competitions and Services Under the volatile marketing environment, having trade or product supply alliances has become an essential business factor. Presently, the Company has not many trade alliances due to competition intensity. Therefore, this is considered a risk. To cope with this risk, the Company focuses on improving the relationship with these alliances, working closely together, negotiating for permanent business liaison, and meanwhile, seeking for new products and suppliers.

2. Financial Risk Factors ë Risks from the increase of interest rate The countryûs fluctuation rate which tends to get higher and may result in the rise of the loan interest rate and an increase in the Groupûs interest costs is considered a risk of the Company. To manage such risk, the Company closely monitors the interest rate tendency and negotiates with financial institutes to settle a fixed interest rate over appropriate terms conformable to the Groupûs cash flow. Additionally, it has also surveyed and arranged for new financial implements or derivatives. ë Risks from Exchange Rate As at December 31, 2007, the Companyûs subsidiaries had net liabilities in foreign currencies which had not been hedged against risks in exchange rate as follows:

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Consolidated Financial Statement Currency Us Dollar Total Total Assets % Per Total Assets

The Companyûs Financial Statement

Foreign Currency

Baht Equivalence: (Million Baht)

Foreign Currency

Baht Equivalence: (Million Baht)

29 Million

997.84 997.84 14,979.43 6.66

-

8,200.97 0.00

Remark : Exchange rate as on December

As the Company has not obtained revenue in foreign currencies, it might be slightly affected by risk from the exchange rate. As at December 31, 2007, remaining foreign-currency liabilities of the Companyûs subsidiaries was merely US$ 29 million ; whereas, their assets in the form of foreign-currency deposit were around USD 20 million. This would reduce impacts, which might be caused by risks from foreign exchange rate. Nonetheless, the Companyûs subsidiaries undertake a short-term risk management measure through forward exchange contracts for the debts in foreign currencies that due within 6 monthûs time. However, the Company believes that it will not be affected both by risks in foreign exchange rate caused by the import of overseas equipment and by the overseas investments since the Company has set up a risk management measure for the purchase of valuable equipment with periodical or lengthy delivery term through forward exchange contracts in foreign currencies. The overseas investments are carried out by JIOC which, at present, has reserved the loss resulted from the decrease in overseas investment value in full amount and recorded such investment amount as zero. ë Risks due to uncertainty of the return on investment of the companyûs subsidiaries The Company has set up a measure for risk management by discussing with its subsidiaries to establish a clear policy regarding the return on investment from the subsidiaries, and has closely monitored each particular subsidiaryûs business operational result. ë Risks from credit refusal from financial institutes As financial loans are essential for business expansion, to prevent the risk from not obtaining credits from financial institutes, the Company has undertaken structural adjustment regarding financial ratio to comply with the creditorsû requirements and also tried to seek credits from alternative financial institutes. The Company realizes the importance of the aforementioned risks factors and their effects on business operation. As such, it has set up measures to control them to be of the least chance of occurrence or to eliminate them to enhance the maximum benefits for the Company. 18

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited


Prospects of Telecommunications Business in the Year 2008 The December 2007 general election has brought Thailand in the following 2008 the new government and the stronger political stability which, as a consequence, has not only gained back the confidence of both the investors and the operators but also attracted them to once again invest in various capital markets and businesses of the country. The once-sluggish investment atmosphere ; therefore, gradually becomes better. The new government itself has issued the policy which emphasizes economic stimulation in many ways ; for instance, promoting the investment in mega-projects to enable the increase in employment ; reducing the interest rate to encourage more household spending ; lifting financial as well as investment measures which hinder foreign investment and so on. However, despite such favorable factors, some same old factors which have affected telecommunications industry and caused concern among the operators ; for examples, the continually increasing oil price, leading to the rise of the production cost ; the Subprime problem of the United States of America which has presently spread to various regions of the world; the Baht appreciation which impacts exporters, the inflation problem and so forth still exist. So far as the 2008 forecast of Thailand没s telecommunications business is concerned, a research by National Statistical Office has revealed that the year 2008 is likely to witness the increase in the reliance on Information and Technology of both the households and offices. Therefore, it is expected that the private and the state sectors would be in good co-operation not solely on the development of the IT system to enhance its efficiency but also on the prudent utilization of the IT resources for adequate service provision country-wide. Due to the rapid growth and progress of telecommunications industry, technological development and convergence are necessary as they lead to the better and quicker services with more beneficial options. The new development on content and application as well as the issue of licenses by National Telecommunication Commission of Thailand (NTC) which allow diverse service provision are essential bases which enable Thailand to be potential and ready for the competition in the international level. Besides, the government is well intent on promoting the use of Information Technology to develop its administration and management. So, e-government, e-commerce and others are encouraged in order to reduce unnecessary working processes and increase administration efficiency. For this purpose, it plans to invest in Broadband network to support the high-speed Internet which will help enhance the virtual private network usage nationwide, enabling the development of new services for the public.

Significant Telecom Business Fixed-line telephone : The fixed-line telephone network which has been only for voice transmission can also be developed to be the network for high-speed data transmission, providing both the high-speed Internet and video transmission at the same time. Moreover, the existing fixed-line telephone network - Fiber optic and copper cable is very potential to enhance higher capacity which will be very useful for the telecom network of high-speed data transfer. Above all, the clients will receive the benefit from this network development. Mobile phone As at present the penetration rate of mobile phone usage almost reaches the saturated point so it is expected that the usage of mobile phones will not increase whereas the income per mobile number tends to be unchanged or decreased respectively. Moreover, the competition among the operators for the clients still focuses on the price deduction which, however, is a benefit for users as the calling rate is decreased. Broadband Internet service Presently there are more and more broadband Internet Service Providers (ISP) as the National Telecommunications Commission (NTC) has issued the high-speed Internet Service Provider license A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

19


to many ISPs. Nonetheless, most users cling to 3 giant operators who already have fixed-line telephone network ; TOT, True and TT&T. Currently, there are 16 million household users while only 1 million or 5% of them use the broadband Internet showing that the penetration rate is still low compared to the country of equal GDP (Gross Domestic Product) per capita to Thailand. Therefore, the Internet business expanding chance is still high.

The Business Trend of the Company in the Year 2008 The business of Jasmine International Group in the year 2008 will develop in every aspect. The synergy among the companies in the Group is planed to enhance the efficiency and increase income for the whole Group as the subsidiaries own efficient operation. Such existing networks of TT&T, JSTC and others can be synergized to be a highly strong, stable and efficient network and further developed for various services and applications. This will be a significant factor in driving the Company to be the Total Internet Player of the country. Regarding the above potentials that allow the Company operate business in various forms, The National Telecommunications Commission (NTC) has issued the telecom licenses to Jasmine International Group as the telecommunication operators providing all kinds of telecom services. These licenses are ; Type 3 license of telecommunication business operation (Licensee with own network).-This license allows service to public users for the following services ; fixed-line telephone nationwide, the high-speed Internet, high-speed leased circuit, digital network, Virtual Private Network, Voice over IP (VOIP) and public pay phone. Type 2 license of telecommunication business operation (Licensee with and without own network).-This license allows service to certain clients for International Private Leased Circuit (IPLC), the International Internet Gateway (IIG), the Internet hub, and Very Small Amateur Terminal (VSAT). Type 1 license of telecommunication business operation (Licensee without network).-This license allows service to public users for the Internet service providing, Voice over IP (VOIP) and international calling card The Company also provides the total turnkey solution service to general clients and big organizations offering design, procurement, system and equipment installation for telecommunication and software system. Presently, the Company has a high market share. Besides, this year the government has investment plan more than 10,000 Million Bath that will help raise the income for the Company consequently. To conduct such projects, the Company is able to operate solely or being a joint venture with foreign companies. One of the dominant business is the high-speed Internet which can contribute a high income and profit to the whole Group. At present, the Company has the market share not less than 25% with about 1 million users in total and it is expected that the number of users will grow up not less than 50% in this year or about 1.5 million users. Such growth will help the Company have more market share in this business. The Company plans to expand all services such as çMax Neté- the high-speed Internet, Hot Spot çCyberpoint wi-fié to cover all over country. The international calling card çThook-Deeé and wide band leased circuit will be a strong drive for the business of the Group. The efficient and professional team is one of the key factors of business success. The Companyûs personnel have a long-time experience and loyal to the company. The training are provided to the employees regularly both in class and via working with the team. Moreover, the Company allows the employees to involve in making strategic plan of the Group and to synergy the business operation and management of all subsidiaries to leverage the efficiency of the customer service. The business conduction of Jasmine International Public Co., Ltd. in the year 2008 will be different from the past as the Company plans to expand the customer base to increase the amount of users with more market share. The advantage of having our own networks that can be synergized to be a strength combining with the professional team which is well-versed in telecommunications engineering, management and customer care is the key wheel in driving the Company business to grow. The Company will gain more income and profit than before by adjusting strategic plans to integrate subsidiariesû business that will considerably support one another among the Jasmine International Group making us the widest-range of telecommunication company of Thailand. 20

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited


Shareholding Structure The shareholding structure of the Company as at the latest closing date for the Company share register book (April 4, 2007) is as follows : Group of Shareholder*

1. 2. 3. 4. 5. 6. 7. 8. 9. 10.

Number of Shares

Bodharamik Group Bulakul Group Thai NVDR Co., Ltd. SOMERS (U.K.) LIMITED Deutsche Bank Group Ms. Kanokkaew Weerawan Bangkok Bank Public Company Limited UBS AG Group Gerlach & Co. Group Norbax Inc.,13

1,894,850,070 605,966,570 319,936,400 305,000,000 217,572,970 180,446,500 115,611,377 102,424,100 87,731,800 82,567,400

% of Total Shares

22.77 7.28 3.85 3.67 2.61 2.17 1.39 1.23 1.05 0.99

Notes : * Information of major shareholders as group of persons and juristic persons % of Shareholding 1) Bodharamik Group - Individual - Mr. Pete Bodharamik - Mr. Anupong Bodharamik 2) Bulakul Group - Individual - Ms. Varinthorn Bulakul - Mr. Chan Bulakul - Mr. Varut Bulakul 3) Deutsche Bank Group - Broker - Deutsche Bank AG London - Deutsche Bank International Ltd. Deutsche Bank AG, Frankfurt 4) UBS AG Group - Broker - UBS AG, London Branch-Asia Equity - UBS AG, Singapore, Branch Securities Client Custody 5) Gerlach & Co Group - Broker - Gerlach & Co - Dimensional Emerging Markets Value Fund, Inc - Gerlach & Co., - The DFA Investment Trust Co - The Emging Mkts Small Cap Series - Gerlach & Co. - Emerging Market Core Equity Port Folio DFA Investment Dimensions Group Inc. - Gerlach & Co. - Dimensional Funds Plc - Gerlach & Co. - Charles Schwab FBO Customers - Gerlach & Co. - National Financial Services LLC

22.70 0.07 3.73 2.70 0.85 2.43 0.18 0.00 1.23 0.00 0.65 0.27 0.09 0.04 0.00 0.00

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

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Management Organization chart of Jasmine International PCL. as at December 31, 2007

Board of Directors

Audit Committee

Chief Executive Officer

Office of Internal Audit

Office of Chief Executive Officer President

Accounting & Finance Department

Office of President

Railway Signaling Project Office

22

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

Human Resources Department

Administration Department

Public Relations Division

Information Technology Department


The Board of Directors

General Tienchai Sirisumpan Honorary Chairman and Independent Director

Dr. Vichit Yamboonruang Independent Director and Chairman of the Audit Committee

Dr. Varapol Socatiyanurak Independent Director and Member of the Audit Committee

Dr. Yodhin Anavil Independent Director and Member of the Audit Committee

Mr. Songrit Kusomrosananan Director and Chief Executive Officer

Mr. Somboon Patcharasopak Director

Mr. Subhoj Sunyabhisithkul Director

Mr. Somsak Padhana-anek Director

Mr. Terasak Jerauswapong Director

Ms. Chomanad Hirunmekavanich Director

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

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24 A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

Information of the Company没s Management or Authorized Persons Name

Position

1) General Tienchai Sirisumpan Honorary Chairman and Independent Director 2) Dr. Vichit Yamboonruang Independent Director and Chairman of the Audit Committee

3) Dr. Varapol Socatiyanurak Independent Director and Member of the Audit Committee

Family Relationship Age Education Work Experiences With other Executives 83 - Chulachomklao Military School (1947) None 2002-Present - Chairman of Semi Conductor Ventures - U.S.A. Command and General Staff College, Industrial Public Co., Ltd. U.S.A. (1960) 1994-Present - Honorary Chairman and Independent Director, - National Defense College RTA. (1973) Jasmine International Public Co., Ltd. 66 - Ph.D. Public & International Affairs, None 2006-Present - Independent Director and Member of the Audit University of Pittsburgh, Pennsylvania, U.S.A Committee, Wiik & Hoeglund Public Co., Ltd. - Thai Institute of Directors Association (IOD) 2004-Present - Independent Director and Chairman of the Audit Chartered Director Class (CDC) Committee, Rayong Purifier Public Co., Ltd. Audit Committee Program (ACP) 2000-Present - Chairman, Global Bond Industrial Co., Ltd. The Role of Chairman Program (RCP) 1999-Present - Independent Director and Chairman of the Audit Directors Certification Program (DCP) Committee, Jasmine International Public Co., Ltd. Directors Accreditation Program (DAP) 1996-2000 - Executive Director, Refining Sector Group and Acting Executive Director, E&P and Natural Gas Sector Group, Petroleum Authority of Thailand 52 - Ph.D. (Finance) from Wharton Institute, None Aug 2007-Present - Chairman of C.I. Group Public Co., Ltd. University of Pennsylvania, U.S.A. 2004-Present - Chairman of the Council of Trustees, Community - Thai Institute of Directors Association (IOD) College, Bangkok, Ministry of Education Role of the Compensation Committee Program (RCC) - Director of National Science and Technology Chartered Director Class (CDC) Development Board Audit Committee Program (ACP) - Chairman of Audit Committee C.I. Group The Role of Chairman Program (RCP) Public Co., Ltd.. Directors Certification Program (DCP) - Independent Director, United Securities Director Accreditation Program (DAP) Public Co., Ltd. 2001-Present - Chairman of Investment Advisory Board, Thai Red Cross Society


Name

4) Dr. Yodhin Anavil

Position

Independent Director and Member of the Audit Committee

Age

58

5) Mr. Songrit Kusomrosananan Director and Chief 49 Executive Officer*

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

6) Mr. Somboon Patcharasopak Director *

47

7) Mr. Subhoj Sunyabhisithkul Director *

39

Education

Family Relationship With other Executives

- Ph.D. Electric Engineer, University of Cincinati, Cincinati, Ohio, U.S.A. - Thai Institute of Directors Association (IOD) Directors Accreditation Program (DAP)

None

- M.B.A., Chulalongkorn University - National Defense College (JSPS), Class 18 - Diploma in Democratic Politics and Governance for High-Level Administrators, King Prajadhipok没s Institute - Thai Institute of Directors Association (IOD) Directors Certification Program (DCP) The Role of Chairman Program (RCP) - M.B.A., Kasetsart University - Thai Institute of Directors Association (IOD) Directors Certification Program (DCP) Director Accreditation Program (DAP) - Bachelor of Electrical Engineering, Chulalongkorn University - Thai Institute of Directors Association (IOD) Directors Certification Program (DCP)

None

Work Experiences

1999-Present - Independent Director and Member of the Audit Committee, Jasmine International Public Co., Ltd. 2000-2004 - Independent Director and Member of Audit Committee, United Securities Public Co., Ltd. 1999-2003 - Director of National Industrial Development Board 2006-Present - Independent Director and Member of Audit Committee, Jasmine International Public Co., Ltd. 2001-Present - Chief Operation Officer, POP Network Co., Ltd. - Director of Board, Department of Intellectual Property, Ministry of Commerce 1998-Present - Executive Director, Chackawat Holding Co., Ltd. 1991-Present - Executive Director, Fairway Estate Co., Ltd. - Executive Director, The Vintage Club Co., Ltd. 1984-Present - Executive of Jasmine International Group

None

2002-Present - Director of Chaengwatana Planner Co., Ltd. 1982-Present - Executive of Jasmine International Group

None

1988-Present - Executive of Jasmine International Group

25


26 A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

Name

Position

Age

8) Mr. Somsak Padhana-anek Director *

44

9) Mr. Terasak Jerauswapong Director *

46

10) Ms. Chomanad Hirunmekavanich Director *

47

11) Mr. Vorasak Pittawong

48

Senior Vice President, Accounting & Finance Department 12) Mr. Roongfa Wattanapasit Vice President, Office of the Internal Audit 13) Mr. Samkhan Rojanathavorn Vice President, Human Resources Department Remarks : * Authorized Director

Education

- M.B.A., Chulalongkorn University - Thai Institute of Directors Association (IOD) Strategy and Policy Development Program Finance for Non-Finance Director (FN) Directors Certification Program (DCP) - Bachelor of Electrical Engineering (Telecommunications), King Mongkut没s Institute of Technology, Ladkrabang - Thai Institute of Directors Association (IOD) Directors Certification Program (DCP) Director Accreditation Program (DAP) - Bachelor in Political Sciences, Chulalongkorn University - Thai Institute of Directors Association (IOD) Director Accreditation Program (DAP) - Bachelor of Finance & Banking, Assumption University

Family Relationship With other Executives

Work Experiences

None

1990-Present - Executive of Jasmine International Group

None

1988-Present - Executive of Jasmine International Group

None

1993-Present - Executive of Jasmine International Group

None

2001-Present - Executive of Jasmine International Public Co., Ltd.

41

- Master of Business Administration, The University of the Thai Chamber of Commerce

None

1995-Present - Executive of Jasmine International Group

52

- M.B.A., Pennsylvania State University, USA

None

2003-Present - Executive of Jasmine International Public Co., Ltd. 1999-2002 - Executive Director, Borneo Technical (Thailand) Co., Ltd.


1. MANAGEMENT STRUCTURE 1.1 Details of the Board of Directors and management of the Company are as follows: The Board of Directors The Company没s Board of Directors as at December 31, 2007 consists of the following 10 directors : 1. General Tienchai Sirisumpan Honorary Chairman and Independent Director 2. Dr. Vichit Yamboonruang Independent Director 3. Dr. Varapol Socatiyanurak Independent Director 4. Dr. Yodhin Anavil Independent Director 5. Mr. Songrit Kusomrosananan Director * 6. Mr. Somboon Patcharasopak Director * 7. Mr. Subhoj Sunyabhisithkul Director * 8. Mr. Somsak Padhana-anek Director * 9. Mr. Terasak Jerauswapong Director * 10.Ms. Chomanad Hirunmekavanich Director * Remarks : * Authorized director

Mr. Pisit Tantirodjanakitjakarn is the Corporate Secretary. The Chief Executive Officer Mr. Songrit Kusomrosananan The Audit Committee The Company没s Audit Committee as at December 31, 2007 consists of the following 3 members : 1. Dr. Vichit Yamboonruang Chairman of the Audit Committee 2. Dr. Varapol Socatiyanurak Member of the Audit Committee 3. Dr. Yodhin Anavil Member of the Audit Committee The Risks Management Committee The Company没s Risks Management Committee as at December 31, 2007 consists of the following 8 directors: 1. Mr. Somboon Patcharasopak Member of the Risks Management Committee 2. Mr. Subhoj Sunyabhisithkul Member of the Risks Management Committee 3. Mr. Somsak Padhana-anek Member of the Risks Management Committee 4. Mr. Terasak Jerauswapong Member of the Risks Management Committee 5. Mr. Pisit Tantirodjanakitjakarn Member of the Risks Management Committee 6. Mr. Vorasak Pittawong Member of the Risks Management Committee 7. Mr. Samkhan Rojanathavorn Member of the Risks Management Committee 8. Mr. Roongfa Wattanapasit Member of the Risks Management Committee and Secretary

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

27


The Management The Companyûs management as at December 31, 2007 consists of the following 4 executives: 1. Mr. Vorasak Pittawong Senior Vice President, Accounting and Finance Department 2. Mr. Roongfa Wattanapasit Vice President, Office of Internal Audit 3. Mr. Samkhan Rojanathavorn Vice President, Human Resources Department 4. Mr. Subhoj Sunyabhisithkul Project Director-Railway Signaling Project Office

1.2 Information of the Management, Authority, and Duties of the Companyûs Board of Directors and Executive Officers The definition of çIndependent Directoré Independent director is a non-executive director who neither involves in the day-to-day management nor is the Companyûs major shareholders. The independent director must have the following qualifications:1. He/she does not hold shares exceeding 5 per cent of the total shares having right to vote in the Company or in a subsidiary or an affiliated company or is not a person who may have conflict of interest including a person related to Section 258 of the Securities Law. 2. He/she is not involved in the day-to-day management and is not an employee or a staff member or an advisor who receives a regular salary from the Company or is not a person who has influence in the Company or in a subsidiary or an affiliated company or is not a person who may have conflict of interest. He/she must be cleared from conflict for minimum of one year. 3. He/she does not have any business relationship such as being customers, suppliers, creditors, debtors and is cleared from either direct or indirect financial or other interest involved in the management and business of the Company, its subsidiary, associated company. He/she is not a person who is confined by conflict of interest 4. He/she is not a relative of management or major shareholders of the Company, a subsidiary or an affiliated company or a person who may have conflict of interest. He/she is not a nominee or representative of any director or major shareholder. Person who may have conflict means a person according to the announcement of the Securities and Exchange Commission, no. Kor Jor. 32/2549 regarding the submission and exemption of submission of the information of the securities offering. Business relationship means the trade transaction or interests received or paid of which its amount is exceeding 5% of the Companyûs income or exceeding 5% of the Company in which the director has an authority or has loan exceeding 5% of total assets of the Company. The Authority and Duties of the Companyûs Board of Directors 1. All directors shall perform their duties in compliance with the laws, Objectives and Articles of Association of the Company as well as resolutions of the Companyûs shareholdesû meetings. 2. All directors are prohibited from engaging in any business, being a partner, or director in any entity which is in a similar business and in competition with the business of the Company, unless such directors receive a prior consent from the board of directors in a board of directorûs meeting. 3. All directors shall inform the Company without delay of their interests in any contract which the Company has entered or is about to enter into, or when their shares or debentures in the Company or its affiliates increase or decrease. 4. A Board of Directorsû meeting shall be held at least once every 3 months. 5. The directors who are authorized to bind the Company in any transactions are either the chairperson or other two directors together, who would sign and affix thereto with the Companyûs seal.

28

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited


6. The Board of Directors is empowered to designate the director(s) to bind the Company by signing his (their) name(s) and affixing the Company没s seal. The Authority and Duties of the Chief Executive Officer The Chief Executive Officer controls, supervises, follows up the operations of the President and the Management team, and concurs and adjusts the Company business plan in compliance with the existent business status. The Chief Executive Officer is authorized to approve the normal business transaction of up to Baht 30 million value for the interests of the business management and operations of the Company so as to ensure that the objectives of the policies and business plan determined by the Board of Directors shall be accomplished. Whereby, the approval for such business transaction does not include the transaction in which Chief Executive Officer or any person, who may have conflict of interest as per definition set forth in the Notifications of the Securities and Exchange Commission and/or the Stock Exchange of Thailand, has an interest in any other way with the Company or its subsidiaries. The Authority and Duties of the President The President manages, administers, and implements the normal functions of the Company in such a way as to further the interests of the Company. The President没s scope of authority and duties are determined by the Board of Directors, as follows: 1. The President is to supervise, administer, and implement the normal functions of the Company in such a way as to further his interests in accordance with the Company没s Objectives and Articles of Association as well as the rules, resolutions, policies, plans, and budgets authorized by the Board of Directors under all relevant laws, and the scope of authority determined by the Board of Directors. 2. The President is to have the authority to approve the transactions in which the Company is borrowing, lending, guaranteeing, purchasing, providing or hiring services, or performing other normal activities of the Company involving sums of not more than Baht 10 million. To this purpose, the President may assign or delegate his authority to any individual as his attorney or substitute to act or perform any specific transactions in accordance with the designated authority. The above-mentioned authority does not include the transaction in which the President or any persons who may have conflict of interest, as per definition set forth in the Notifications of the Securities and Exchange Commission and/or the Stock Exchange of Thailand, have an interest or conflict of interest in any other way with the Company or its subsidiaries. The Scope of Duties and Responsibilities of the Audit Committee 1. To verify all financial reports for completeness, creditability, and conformity to actual conditions 2. To verify internal controls procedures and systems for appropriateness and effectiveness 3. To appoint an independent auditor 4. To verify and keep the Company to conform to laws and regulations 5. To verify and prevent any of conflicts of interest occurrence 6. To perform whatever duties assigned by the Board of Directors 7. To prepare a report of the Audit Committee, signed by the Chairman of the Audit Committee The Audit Committee has a 3-year term in the office. In case of vacancy for any reason other than at the expiry of his term, the Board of Directors shall, to fulfill the Audit Committee as stipulated, elect and appoint a qualified person to fill in the vacancy. Such new member of the Audit Committee shall retain his office only for the remaining term of the office of the Audit Committee member whom he replaces. A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

29


Authorities and duties of Risks Management Committee 1. To stipulate Risk Management framework and policy 2. To set up risk management strategy, proceed and promote the risk management to be used in the whole organization, focusing on raising of risk awareness 3. To verify, follow up and evaluate the risk management plan so as to decrease the risks to be in a proper level 4. To regularly report to the Board of Directors of the Company regarding the matters that need to be improved so as to be in compliance with the set forth rules and regulations

Shareholding by the Directors Shareholding by the Board of Directors in Subsidiary/Associated Companies Name of Company Jasmine Submarine Telecommunications Co., Ltd. Thai Long Distance Telecommunications Co., Ltd.

JasTel Network Co., Ltd.

Acumen Co., Ltd. Smart Highway Co., Ltd.

ACeS Regional Services Co., Ltd.

ACeS (Thailand) Co., Ltd.

Jasmine Telecom Systems PCL.1)

30

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

Name of Directors Mr. Songrit Mr. Somboon Mr. Songrit Mr. Somboon Mr. Terasak Mr. Songrit Mr. Somboon Mr. Subhoj Mr. Somsak Mr. Terasak Mr. Songrit Mr. Somboon Mr. Songrit Mr. Somboon Mr. Subhoj Mr. Somsak Mr. Terasak Ms. Chomanad Mr. Songrit Mr. Somboon Ms. Chomanad Mr. Songrit Mr. Somboon Ms. Chomanad Mr. Songrit

Kusomrosananan Patcharasopak Kusomrosananan Patcharasopak Jerauswapong Kusomrosananan Patcharasopak Sunyabhisithkul Padhana-anek Jerauswapong Kusomrosananan Patcharasopak Kusomrosananan Patcharasopak Sunyabhisithkul Padhana-anek Jerauswapong Hirunmekavanich Kusomrosananan Patcharasopak Hirunmekavanich Kusomrosananan Patcharasopak Hirunmekavanich Kusomrosananan

Mr. Somboon

Patcharasopak

Mr. Subhoj

Sunyabhisithkul

Type of Share Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary ESOP Ordinary ESOP Ordinary ESOP

Number of Shares as at December 31st, 2007 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 100,400 1,050,000 100,400 600,000 100,000 1,050,000


Name of Company

TT&T PCL.2)

Premium Asset Co., Ltd. T.J.P. Engineering Co., Ltd.

Mobile Communication Services Co., Ltd.

Compunet Corporation Limited

Jasmine Cyberworks Co., Ltd.

Jasmine Smart Shop Co., Ltd.

Remarks :

1) 2)

Name of Directors Mr. Somsak

Padhana-anek

Mr. Terasak

Jerauswapong

Mr. Songrit Mr. Somboon Mr. Terasak Mr. Somsak Mr. Terasak Mr. Songrit Mr. Somboon Mr. Subhoj Mr. Somsak Mr. Terasak Mr. Songrit Mr. Somboon Mr. Subhoj Mr. Somsak Mr. Terasak Ms. Chomanad Mr. Songrit Mr. Somboon Ms. Chomanad Mr. Songrit Mr. Somboon Mr. Subhoj Mr. Somsak Mr. Terasak Mr. Songrit Mr. Somboon Ms. Chomanad

Kusomrosananan Patcharasopak Jerauswapong Padhana-anek Jerauswapong Kusomrosananan Patcharasopak Sunyabhisithkul Padhana-anek Jerauswapong Kusomrosananan Patcharasopak Sunyabhisithkul Padhana-anek Jerauswapong Hirunmekavanich Kusomrosananan Patcharasopak Hirunmekavanich Kusomrosananan Patcharasopak Sunyabhisithkul Padhana-anek Jerauswapong Kusomrosananan Patcharasopak Hirunmekavanich

Type of Share Ordinary ESOP Ordinary ESOP Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary

Number of Shares as at December 31st, 2007 0 600,000 100,000 600,000 331,350 637,750 77,000 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1

Shareholding as at 3 December 2007, the closing date of share register book Shareholding as at 6 March 2007, the closing date of share register book

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

31


32 A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

Stakes in Jasmine International Public Company Limited for the Management or Authorized Persons Name 1) 2) 3) 4) 5) 6) 7) 8) 9) 10) 11) 12) 13)

General Tienchai Dr. Vichit Dr. Varapol Dr. Yodhin Mr. Songrit Mr. Somboon Mr. Subhoj Mr. Somsak Mr. Terasak Ms. Chomanad Mr. Vorasak Mr. Roongfa Mr. Samkhan

Remarks :

(1) (2) (3) (4) (5) (6) (7) (8)

= JAS = ESOP = JAS-W = JAS-W2 = Total JAS = Total ESOP = Total JAS-W = Total JAS-W2

Sirisumpan Yamboonruang Socatiyanurak Anavil Kusomrosananan Patcharasopak Sunyabhisithkul Padhana-anek Jerauswapong Hirunmekavanich Pittawong Wattanapasit Rojanathavorn

Share Holding Ratio JAS(1) Amount of Shares %(5)

2,993,300 1,193,300 32,764,420 18,589,270 2,500,000 5,509,500 30 30 -

Share Holding Ratio ESOP(2) Amount of Shares %(6)

0.04 0.01 0.39 0.22 0.03 0.07 0.00 0.00 -

Ordinary Share All Classes and Issues of the Directors or Employees Stock Option Plan Right Warrant Right Warrants No. 2 8,319,907,163 Shares 67,379,950 Units 1,156,173,100 Units 5,035,417,950 Units

9,877,860 9,278,010 9,278,010 3,771,540 3,905,240 505,840 -

14.66 13.77 13.77 5.60 5.79 0.75 -

Share Holding Ratio JAS-W(3) Share Holding Ratio JAS-W2(4) Amount of Shares %(7) Amount of Shares %(8)

14,117,890 14,966,500 75,580 -

1.22 1.29 0.01 -

28,933,000 13,800,000 3,936,000 5,509,500 -

0.57 0.27 0.08 0.11 -


Change in Shareholding of the Directors and the Management of Jasmine International Public Company Limited Change of Share Amount in the year 2007 Name-Surname

1. General Tienchai Sirisumpan

Ordinary Share (Shares)

JAS-W

JAS-W2

-

-

-

-

-

-

-

-

-

-

-

-

-

-

Warrant (units)

Class 1 Warrant

Class 2 Warrant

Issue No. 2* Issue No. 3 Issue No. 3* Issue No. 4* Issue No. 5 Issue No. 6

Class 3 Warrant

Issue No. 7 Issue No. 8

Issue No. 9 Issue No. 10

Issue No. 2*

2. Dr. Vichit

Yamboonruang

(1,000,000)

-

-

-

-

-

-

-

-

-

-

-

-

-

3. Dr. Varapol

Socatiyanurak

-

-

-

-

-

-

-

-

-

-

-

-

-

-

4. Dr. Yodhin

Anavil

-

-

-

-

-

-

-

-

-

-

-

-

-

-

5. Mr. Songrit

Kusomrosananan

-

-

-

-

-

-

(1,376,910)

-

-

-

-

-

-

-

6. Mr. Somboon

Patcharasopak

-

-

-

-

-

-

-

-

-

-

-

-

-

-

7. Mr. Subhoj

Sunyabhisithkul

-

-

-

-

-

-

(1,325,430)

-

-

-

-

-

-

-

8. Mr. Somsak

Padhana-anek

-

-

(1,767,240) (1,325,430)

-

-

-

-

-

-

-

9. Mr. Terasak

Jerauswapong

(1,500,000) (2,300,060)

(310,000)

-

-

-

-

-

(718,390)

(538,790)

-

-

-

-

-

-

-

10. Ms. Chomanad Hirunmekavanich

-

-

-

(1,516,600)

-

(454,980)

(341,230)

-

-

-

-

-

-

-

11. Mr. Vorasak

Pittawong

-

-

-

-

-

-

-

-

-

-

-

-

-

-

12. Mr. Samkhan

Rojanathavorn

-

-

-

(77,800)

-

-

-

-

-

-

-

-

-

-

13. Mr. Roongfa

Wattanapasit

-

-

-

-

-

-

-

-

-

-

-

-

-

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

Remarks : * Class 1 Warrant Class 2 Warrant Class 3 Warrant

Issue No. 2 Issue No. 3 and 4 Issue No. 2

Expired on 10 April 2007

(116,730)

33


34 A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

Change in Shareholding of the Directors and the Management of Jasmine International Public Company Limited (Continued) Total Amount at the End of 2007 Name-Surname

Ordinary Share (Shares)

Warrant (units)

Class 1 Warrant

JAS-W

JAS-W2

Class 2 Warrant

Issue No. 2* Issue No. 3 Issue No. 3* Issue No. 4* Issue No. 5 Issue No. 6

Class 3 Warrant

Issue No. 7 Issue No. 8

Issue No. 9 Issue No. 10

Issue No. 2*

1. General Tienchai Sirisumpan

2,993,300

-

-

-

-

-

-

-

-

-

-

-

-

-

2. Dr. Vichit

Yamboonruang

1,193,300

-

-

-

-

-

-

-

-

-

-

-

-

-

3. Dr. Varapol

Socatiyanurak

-

-

-

-

-

-

-

-

-

-

-

-

-

-

4. Dr. Yodhin

Anavil

-

-

-

-

-

-

-

-

-

-

-

-

-

-

5. Mr. Songrit

Kusomrosananan

32,764,420 14,117,890 28,933,000

-

-

-

-

1,915,710

1,376,910

1,915,710

1,376,910

1,915,710

1,376,910

-

6. Mr. Somboon

Patcharasopak

18,589,270 14,966,500 13,800,000

-

-

-

-

-

-

-

-

-

-

-

7. Mr. Subhoj

Sunyabhisithkul

-

-

3,936,000

-

-

-

-

1,767,240

1,325,430

1,767,240

1,325,430

1,767,240

1,325,430

-

8. Mr. Somsak

Padhana-anek

2,500,000

-

-

-

-

-

-

1,767,240

1,325,430

1,767,240

1,325,430

1,767,240

1,325,430

-

9. Mr. Terasak

Jerauswapong

5,509,500

75,580

5,509,500

-

-

-

-

718,390

538,790

718,390

538,790

718,390

538,790

-

-

-

-

1,516,610

-

-

454,980

341,230

454,980

341,230

454,980

341,230

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

10. Ms. Chomanad Hirunmekavanich 11. Mr. Vorasak

Pittawong

12. Mr. Samkhan

Rojanathavorn

13. Mr. Roongfa

Wattanapasit

Remarks : * Class 1 Warrant Class 2 Warrant Class 3 Warrant

30 30

Issue No. 2 Issue No. 3 and 4 Issue No. 2

Expired on 10 April 2007

116,730

-

116,730

155,650

116,730

-


Details of the Executives and Authorized Persons in the Subsidiary and Affiliated Companies Names of Executives / Authorized Persons

JSTC TLDT JasTel ACU SHW TTTBB ARS Ji-NET

1) General Tienchai Sirisumpan

H,I

2) Dr. Vichit

Yamboonruang

CA,I

3) Dr. Varapol

Socatiyanurak

AC,I

4) Dr. Yodhin

Anavil

AC,I

5) Mr. Songrit

Kusomrosananan A,CEO A

A

A

A

6) Mr. Somboon

Patcharasopak

A

A

A

A

7) Mr. Subhoj

Sunyabhisithkul

A

A

A

8) Mr. Somsak

Padhana-anek

A

A

9) Mr. Terasak

Jerauswapong

A

A,P

10) Ms. Chomanad Hirunmekavanich 11) Mr. Vorasak

A

A,C

A,C

A,P

A,CE

A

A

A

A,E,P

A

A

A

A,P

A

A

A,P

A

A

D

A

JTS

A,C

STCC NTU JIOC

A

A

JSS

A,C

A

A,CE A,CE

A

A

D

A,CE A,E

A

A,P

A,E

E

A,E,P

A

A A

CP

A

PA

ACT

A

A,C

A

A

A

A

A

A

D

AC CA D I

= = = =

Member of the Audit Committee Chairman of the Audit Committee Director Independent Director

A

CE E P

PP

= Chairman of Executive Committee = Executive Director = President

TT&T

A A A

A

IKSC

A,C

A

A

Pittawong

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

Remarks : A = Authorized Director C = Chairman CEO = Chief Executive Officer H = Honorary Chairman VC = Vice Chairman

Affiliates

Subsidiaries

JAS

A

35


36 A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

Details of the Directors in the Subsidiary and Affiliated Companies

JSTC TLDT JasTel ACU SHW TTTBB ARS

1. Ms. Saijai 2. Mr. Weera 3. Mr. Pisit 4. Mr. Swat 5. Mr. Pleumjai 6. Mr. Kittipong 7. Mr. Varin 8. Mr. Julapong 9. Mr. Paisan 10. Ms. Orapin 11. Mr. Panapak 12. Mr. Arporn 13. Mr. Monton 14. Mr. Annop 15. Ms. Busakorn 16. Ms. Oranuch 17. Ms. Pindao 18. Ms. Sirirat

Kitsin Kongcharoen Tantirodjanakitjakarn Srikham Sinakorn Mekvichitsaeng Chayanun Limpasuthum Kaweyanun Pongvaramitchai Prommakoon Kengpol Sudprasert Suthakavatin Jonksaksawat Chandhasin Rojanakul Kanhasiri

Remarks : A = Authorized Director CA = Chairman of the Audit Committee D = Director I = Independent Director

Affiliates

Subsidiaries

Names of Executives D

D D

D

Ji-NET

JTS

STCC JIOC

JSS

CP

PA

ACT

PP

A,E E

A

A,E,P A,VC A

D,E A A A D A A D,CA,I D,AC,I D,AC,I E A A A

AC CE E P

= = = =

TT&T IKSC

Member of the Audit Committee Chairman of the Executive Committee Executive Director President

C CEO H VC

= = = =

Chairman Chief Executive Officer Honorary Chairman Vice Chairman


Details of the Directors in the Subsidiary and Affiliated Companies (Continued)

JSTC TLDT JasTel ACU SHW TTTBB ARS

19. Ms. Saowanit Thanomsuwan 20. Mr. Pete Bodharamik 21. Mr. Raks Unahabhoka 22. Ms. Punnee Worawuthichongsathit 23. Ms. Bilaibhan Sampatisiri 24. Mr. Sudhitham Chirativat 25. Mr. Prachuab Tantinon 26. Mr. Vasant Chatikavanij 27. Mr. Suroj Lamsam 28. Ms. Manida Zinmerman 29. Mr. Taj Bussadeegarn 30. Mr. Thiti Nantapatsiri 31. Mr. Noppadol Dejudom 32. Ms. Pannipa Rodwanna 33. Ms. Suvimol Krittayakiern 34. Mr. Somchai Manuratanawong 35. Mr. Kritsada Boonchaiya A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

Remarks : A = Authorized Director CA = Chairman of the Audit Committee D = Director I = Independent Director

Affiliates

Subsidiaries

Names of Executives

Ji-NET

JTS

STCC JIOC

JSS

CP

PA

ACT

PP

TT&T IKSC

A A

A CA,I AC,I AC,I I A,P D A

A

A

A A A A D D D E

AC CE E P

= = = =

Member of the Audit Committee Chairman of the Executive Committee Executive Director President

C CEO H VC

= = = =

Chairman Chief Executive Officer Honorary Chairman Vice Chairman

37


2. RECRUITMENT OF DIRECTORS AND EXECUTIVES The constitution, and the appointment or removal or vacation from the office of the directors have been set forth in the Articles Association of the Company, which are summarized as follows: 1. The Company shall have a Board of Directors comprising at least 5 individuals and not less than half of the total number of directors must have their residence in the Kingdom of Thailand. 2. The shareholders shall appoint the directors, at the shareholdersû meeting, in accordance with the following rules and procedures: 1). Each shareholder shall have one vote per share. 2). Each shareholder may cast his vote(s) as per calculated in 1) for one or any number of the candidates, one by one. However, the vote(s) shall not be distributed or divided among the candidates. 3). The candidates receiving the highest number of votes in the respective order of the votes shall be elected at such time. In the event that a number of candidates receiving an equal number of votes for the last directorship exceeds the number of directors the Company required or to be elected at such time, the Chairman of the meeting shall have a second or casting vote. 3. A director who wishes to resign from office shall submit his resignation letter to the Company. The resignation shall be effective from the date the resignation letter reaches the Company. 4. At every annual general meeting, one-third of the directors who has the longest term in office shall retire. If the number of directors is not a multiple of three, then the number nearest to one-third shall retire from office. The retired director shall be eligible for re-election. 5. The shareholdersû meeting may adopt a resolution to remove any director from office prior to the end of his term by a vote of not less than three-fourth of the number of the shareholders who attend the meeting and have the right to vote and by an aggregate of not less than half of the number of shares which are held by the shareholders who attend the meeting and have the right to vote. In selection of the independent director, the Company has set the qualifications as mentioned in clause 1.2. The Company will nominate or approach the qualified experts from various professions who not only possess leadership, moral and ethics but also are able to express their opinions freely for being selected as the independent director.

3. REMUNERATION FOR MANAGEMENT 3.1 Cash Remuneration 1) Remuneration for Board of Directors of the Company and its Major Subsidiaries 1.1) Jasmine International Public Company Limited ë Each Independent Director receives the remuneration of 40,000 Baht per month. ë The Chairman of the Audit Committee receives the remuneration of 10,000 Baht per month. ë The Honorary Chairman receives the remuneration of 160,000 Baht per month ë The Executive Directors do not receive the remuneration. 1.2) Jasmine Submarine Telecommunications Co., Ltd. The Executive Directors do not receive the remuneration. 1.3) Acumen Co., Ltd. The Executive Directors do not receive the remuneration.

38

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited


2) The Remuneration for the Executive Directors and Management of the Company and its Major Subsidiaries Items

Persons

1. Jasmine International PCL. 2. Jasmine Submarine Telecommunications Co., Ltd. 3. Acumen Co., Ltd. Total

4 8 6 18

Year 2006 (Baht) 14,022,389.00 14,541,037.87 11,107,455.00 39,670,881.87

Details Salary and bonus Salary and bonus Salary and bonus

The details of remuneration paid in cash to the Companyûs Plan Administrator and Audit Committee during the year 2007 is as follows:ë The total remuneration of the Plan Administrators was Baht 100,000 per month. ë The total remuneration of the 3 Audit Committee members in 2007 was Baht 1,560,000 This is shown in the subsection 3.1 clause 1.1. 3.2 Other Forms of Remuneration 1) The Company had issued Rights Warrants for the subscription of common shares of the Company and offered to the Directors and employees of the Company and subsidiaries (ESOP). The total amount of 18,375,706 units, classified as the following:ë Class 1 Warrants (ESOP) Total 11,749,574 Units Exercise Price* 10.00 Baht Final Exercise Date 15 March 2008 ë Class 2 Warrants (ESOP) Total 5,426,132 Units Exercise Price* 15.00-29.28 Baht Final Exercise Date 15 March 2010 ë Class 3 Warrants (ESOP) Total 1,200,000 Units Exercise Price* 15.00 Baht Final Exercise Date 15 March 2007 Remarks: * The ESOP exercise prices were adjusted as per details in the Remarks of 8.1 clause 2), Warrants in the 56-1 Form.

As at April 10, 2007, the un-subscribed ESOP of 29,396,238 units expired as detailed below:ë Class 1 ESOP, Issue No. 2: 12,985,008 units ë Class 2 ESOP, Issue No. 3: 4,994,620 units ë Class 2 ESOP, Issue No. 4: 6,926,660 units ë Class 3 ESOP, Issue No. 2: 4,489,950 units As at December 31, 2007 the remaining of the un-subscribed warrant of ESOP are 67,379,950 units. (Please see details of warrants allocation for directors and/or employees in the Prospectus of warrant subscription for directors and/or employees, issues 1 and 2. The number of ratio of allocated warrants for the executives of the Company compared to the total number of the right warrants can be found in the 56-1 Forms of the years 2001 and 2002.)

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2) The Company established a provident fund to serve as a welfare and security for its employees upon employment termination, physical deformity, retirement, death or resignation from the fund. The fund, namely Registered Provident Fund of Jasmine Group, consists of the employees contribution amounting to 3% of their basic salary (or higher as designated by each employee, but not exceeding the Company contribution rate) and the Company contribution based on each employeeûs year of service.

4. CORPORATE GOVERNANCE POLICY The Companyûs Board of Directors is entitled to set up Corporate Governance Policy which encompasses 5 major principles to be in line with the guideline of the Stock Exchange of Thailand, the details of which are as follows : 1. The Rights of Shareholders The Company is well aware that all the fundamental rights of the shareholders both as investors and company owners must be significantly recognized. Such rights include the right to purchase or transfer the securities they hold, the right to receive the Companyûs sharing profits, the right to adequately access the Companyûs information, the right to attend the shareholdersû meeting wherein they can express their opinions and vote on resolutions on the Companyûs significant matters; for instance, the dividend payment, the appointment or dismissal of a director, the appointment of the external auditors, the approval of any crucial transaction which might affect the directions of the Companyûs operation, the amendment on Memo of Association or Articles of Association and so on. Moreover, to support and facilitate the shareholders in exercising their rights, the Company manages to arrange the Shareholdersû Annual General Meeting within the first 4 months of the Companyûs fiscal year. As for the so called çExtraordinary Shareholdersû Meetingé, each will be called for only when it is deemed appropriate. Invitation letters together with the meeting agenda and related documents with adequate fact (s), reason (s) and opinion (s) of the Board of Directors will be distributed for the shareholders to consider 7 or 14 days prior to the meeting date, depending on the subjects. The Company also advertises the Meeting notice in the press 3 days consecutively before the date of meeting. Provided that a shareholder is unable to attend the meeting in person, the Company allows him/her to assign an independent director or any person to attend and vote on his/her behalf. To this regard, the shareholder as the Proxy Grantor must inform the Company in writing by filling in one of the proxy forms attached with the meeting invitation letter or downloaded from the Companyûs website. During the meeting, the Company provides equal opportunities for the shareholders to make enquiries or to express their views. Therein, all the Companyûs directors and relevant management are present to be acknowledged of the shareholdersû opinions as well as to answer the questions raised. Every question-and-answer issue and all the significant opinions are recorded in the minutes of meeting to facilitate the shareholdersû scrutiny. Such minutes, written after the meeting date, presents the complete and accurate information which is examinable. 2. The Equitable Treatment of Shareholders The Company has a policy to treat all the shareholders equally be they major shareholders, minor shareholders, institutional investors or foreign investors. Independent directors are assigned by the Company to be responsible for looking after the minor shareholders. The shareholdersû meeting is properly conducted according to the scheduled agenda in respect of the Companyûs Articles of Association. Related information is clearly presented. No un-informed agenda is introduced to the meeting neither is an important agenda which the shareholders need some time to make a prudent study before making a decision. In case that a shareholder is unable to attend the meeting in person, the Company allows him/her 40

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to assign an independent director or any person to attend and vote on his/her behalf. To this regard, the shareholder as the Proxy Grantor must inform the Company in writing by filling in one of the proxy forms attached with the meeting invitation letter or downloaded from the Companyรปs website. Voting process is transparent with regard to the order of agenda items. During the meeting, the shareholders are entitled to cast the vote to express their agreement or disagreement or even to abstain from voting on such issues as related transactions, the acquisition or the disposal of the Companyรปs assets and so on. The agenda on director election provides the shareholders with the chance to elect the directors as individual persons to replace the ones who retire by rotation. The Company has established the Code of Business Ethics for the employees, stipulating the importance of keeping the information of both the Company and its subsidiaries in confidence. It has also set up penalty for any staff who makes use of the inside information for his/her own benefits or implement the same in the manner that may damage the Companyรปs reputation. Additionally, the trading or transferring of the Companyรปs securities by using confidential information and / or inside information is prohibited in the like manner as the conduct of juristic act, using the Companyรปs confidential information and / or inside information since such doing may cause damage to the Company either directly or indirectly. The Company has set up a measure to prevent the improper รงInsider Tradingรฉ by relevant persons who are directors, executives, and staff working in the department related to the inside information (including their spouses and minors). According to the measure, such relevant persons are not allowed to trade the Companyรปs securities a month before the disclosure of the quarterly and annual financial statements. The Company has informed its directors and executives not only of their duty to report their holding of the Companyรปs securities but also the penalty according to the Securities and Exchange Act of B.E.2535 and the regulations of the Stock Exchange of Thailand. In case that the directors or executives trade the Companyรปs securities which they hold, they are obliged to report changes in the possession of their own securities, spouses and minors to the Office of Securities Exchange Commission to comply with Section 59 of the Securities and Exchange Act of B.E.2535 within 3 weekdays so that it is further disclosed to the public. Pertaining to this matter, the Company has set up the disciplinary penalty to apply to any relevant person who discloses or makes use of the Companyรปs inside information for seeking his / her own personal interests. The degree of penalty varies, according to the case, from verbal warning, written warning to probation or dismissal. 3. The Role of Stakeholders The Company equally respects the rights of all the stakeholders whether they are the inside stakeholders such as the Companyรปs employees and management or outside-party stakeholders such as creditors and customers, etc. It also realizes that the support and suggestions from every group of its stakeholders are valuable and beneficial to both the operation and business development. Therefore, it will perform the duty to comply with the law and other related regulations to ensure that all the rights of the stakeholders are well protected. Moreover, for the Companyรปs stability, the cooperation between the Company and all the groups of stakeholders are strongly supported. With respect to this, the Company follows the directions below to appropriately treat each stakeholder group. Shareholders : With the aim to bring about the highest satisfaction to its shareholders, the Company tries its best to be the their ever efficient and trustworthy business representatives, taking into account the long term growth of its value and the emphasis on transparent and honest information disclosure. Employees : The Company regards employees as its precious resources. So, it focuses on supporting human resources development which consequently leads to its maximum benefit. Besides, it encourages the employees to play a part in creating a good organization culture, strong teamwork and safe and pleasant working atmosphere. A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

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Competitors : The Company commercially contends with other trade competitors on the fair and ethical competition basis. Customers : The Company is committed to providing quality services for the highest satisfaction and confidence of the customers. Trade Counterparts and Creditors : The Company has the policy to treat both the counterparts and the creditors fairly in compliance with trading conditions and / or terms in the mutual contracts to enhance good business relationship, beneficial to all parties. Community and Public : On the regular basis, the Company joins and sponsors socially constructive projects and activities as exemplified by financial and material donations to several foundations and organizations. Environment : The Company recognizes the importance of environment and simultaneously is concerned about the impact of pollutions on communities. The Companyûs nature of business does not jeopardize the environment. The Company will conduct its business to be in line with the law and other related regulations to assure the shareholders of the best protection of their rights. 4. Disclosure and Transparency The Companyûs Board of Directors takes as its obligation the disclosure of the Companyûs financial and other Company-related information to be complete, accurate, and transparent in compliant with the regulations of the Office of Securities Exchange Commission and the Stock Exchange of Thailand. Additionally, it discloses other significant information which may affect the price of the Companyûs securities which in turn impacts on the decision of the Companyûs investors and stakeholders. Such information is accessible to the Companyûs shareholders, investors and the public via the channels and media of the Stock Exchange of Thailand as well as the Companyûs website. For Investor Relations, the Finance and Group Accounting Department is assigned to represent the Company in communicating with institutional investors, shareholders, analysts and relevant state organizations; whereas, the Administration Department is accountable for corporate reports. The Companyûs Board of Directors is responsible for the consolidated financial statements of the Company and its subsidiaries as well as any financial-related information presented in the Companyûs Annual Report. Such financial statements are prudently prepared pursuant to the accounting principles generally accepted country-wide based on the appropriate accounting policy to which the Company regularly conforms. The Audit Committee is obliged to verify the quality of the Companyûs financial reports and internal control system, including the adequacy of the disclosure of important information in notes to the financial statements prior to submitting all to the Board of Directorsû and the Shareholdersû meetings respectively. 5. Responsibilities of the Board of Directors 1. Structure of the Board of Directors The Board of Directors of the Company is made up of individuals recognized for their knowledge and capabilities. It plays the vital role in setting up the corporate policy and image besides independently overseeing, auditing, and assessing the Companyûs performance to be in accordance with the Business Plan. The Board of Directors totally comprises 10 directors, 4 of whom are independent directors. The appointment of the independent directors in such adequate and proper proportion enables the balance of power in the Board of Directors. The Companyûs administration is finally examined by the Audit Committee which consists of 3 accredited independent members. According to the Companyûs Articles of Association, at every Shareholdersû Annual General Meeting, one-third of the directors who have the longest terms in office shall retire. Nevertheless, provided that the number of

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the directors is not a multiple of three, then the number nearest to one-third shall retire from office. The retirement of the directors in the first and the second year after the listing of the Company on the Stock Exchange of Thailand is based on the method of lot-drawing. As for in the later years, the directors who serve the longest terms shall retire. The Companyûs Articles of Association also prescribes that the retired directors are eligible for the re-election. Furthermore, whether a director or a committee member can continuously remain in office without break for the longest period will be determined by the Company by taking into account his/her individual qualifications and appropriateness. The Board of Directors has approved to embrace the disclosure of the number of other companies in which each director has his / her position as a significant criterion for the Board of Directors election. The Company; thus, discloses the information of all the directors who also are directors of other companies in details. At present, 7 directors of the Companyûs Board are holding the positions of director in other companies. However, since those directors have sufficiently devoted their time carrying out the Companyûs tasks with all their efforts, the holding of their positions in other companies does not affect their performance at all ; moreover, they regularly join the Board of Directorsû meetings of the Company and always provide practical opinions for the Company therein. 2. Committee To bring about efficiency in corporate governance, the Company established 2 sets of committee, namely the Risk Management Committee and the Audit Committee. It has also set up distinct scopes of authority, duty and responsibility for the members of such committees. 3. Role, Duty, and Responsibility of the Board of Directors The Companyûs Board of Directors is made up of individuals who are knowledgeable, proficient, expert and well equipped with beneficial experiences in various fields apart from distinguished leadership. They collectively set visions, missions, strategies and business directions in addition to providing efficacious oversight of the Companyûs operation to fully comply with all the relevant laws and to correspond to the objectives and regulations of the Company as well as the resolutions of the shareholdersû meeting. They also set up committees to monitor and supervise the Companyûs operation. Corporate Governance Policy The Company is entitled to set up the policy of good corporate governance in writing. Such policy, approved by the Board of Directorsû meeting, is regularly reviewed at least once a year in terms of content and practice. Business Ethics The Company has set up and put in writing the Code of Business Ethics as an essential guideline for the Board of Directors, the management and employees of all levels to adhere so as to conduct the Companyûs business and serve all the groups of stakeholders, society and the public fairly and honestly. Besides, it has announced such Code of Business Ethics and acknowledged them to its employees for strict compliance. For effectiveness, a system of follow up the practice of the Business Code of Ethics is set up and regularly applied. Conflict of Interest The Companyûs Board of Directors has set up the policy on conflicts of interest based on the principle that any decision on business conduct must be made with respect to the highest interests of the Company only. Any action which might lead to conflicts of interest must be avoided. It is specified that any person relevant or related to the subject to be considered is obliged to acknowledge the Company of his / her relationship or relevance to the matter. He/She is not permitted to join the party which judges the case and does not have the power to authorize that particular case and others. No conditions or regulations are specially set for such case. It is also stipulated that the A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

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Office of Internal Audit and the Audit Committee are responsible for taking care of and solving the conflicts of interest. However, to date, the Company has not experienced the problem related to the conflict of interest. The Audit Committee will report the carefully considered related party transaction and the matter containing a conflict of interest to the Board of Directors in compliance with the regulations of the Stock Exchange of Thailand. Such information is disclosed in the Companyûs Annual Report and the Updated Registration Statement (56-1 Form). Whenever changes in the securities holding of the Board of Directors and the management of the Company, including their spouses and minors occur, they must be informed to the Company and reported to the Office of Securities Exchange Commission, respectively according to Section 59 of the Securities and Exchange Act of B.E.2535 within 3 weekdays after the date of purchase, sale or transfer. Besides, to prevent the improper usage of the Companyûs inside information, the directors, executives and departments having an access to the Companyûs inside information are forbidden from disclosing such information to the outside parties and anyone who does not involve in the Companyûs securities trading a month prior to the disclosure of the Companyûs financial statements. Internal Control System Realizing the importance of the efficient internal control system of both the management and the operation levels, the Company has specified the scopes of the duty and the authority for its executives and employees clearly in writing. It also conducts the control of assets usage. In addition, the duties of the staff and those of the monitoring and assessment officers are segregated from each other. The Audit Committee has been set up by the Company to oversee and monitor such control system to be appropriate and efficient. Risks Management The Company evaluates the adequacy of its internal control system on a yearly basis in order to find the way to properly improve the task operation to be increasingly effective. Report of the Board of Directors The Company Audit Committee is accountable for the review of the financial report. Quarterly, such report will be presented to the Board of Directors by the Group Accounting Department. The joint meeting between the relevant staff and the management of the Group Accounting Department and the Companyûs auditors is scheduled at least once a year. The Board of Directors is responsible for the consolidated financial statements of the Company and its subsidiaries as well as the financial information (the report on the Board of Directorsû responsibilities for financial matters) presented in the Annual Report. Such financial statements are prepared in accordance with the accounting principles certified and verified with prudence by the Companyûs auditors. The disclosure of significant financialrelated or non-financial related information is completely and regularly done on the factual basis. Board of Directorsû Meeting The Companyûs Board of Directorsû meeting is scheduled to be convened once every 3 months. However, a special meeting can be called if it is deemed necessary. The agenda items for each meeting are clear and specific. Documents concerned are sent to the directors prior to the meeting date in order to provide them with sufficient time of study, except for the emergency case. The meeting is recorded in writing. The minutes as well as other certified documents are kept for references and all must be examinable in the following meeting. The Chairman and the President of the Company jointly consider the issues to be included in the meeting agenda. To this regard, each director can also suggest issues for the Chairman and the President to consider for agenda preparation. During the meeting, the Companyûs Chairman, as the Chairman of the Board of Directorsû meeting, will provide opportunities for the directors to independently express their opinions. Sometimes, the Companyûs senior executives are invited to join the meeting for the provision of additional useful information for some particular 44

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agendas. On this occasion also that they can be directly acknowledged of the policy and put it into practice accordingly and efficiently. Decisions are based on a majority vote of the Board members attending the meeting ; one director is eligible for one vote. However, a director who has some interests in the matter under consideration shall not join the meeting and / or abstain from voting for it. In case of tie, the Chairman has the casting vote. The Board of Directorsû minutes of meeting, taken by the Secretary to the Board of Directors who takes part in every meeting, is presented to the chairman of the meeting to consider and sign for certification prior to being proposed as the first agenda item in the following meeting for the Board of Directorsû approval. After the approval, the Secretary will store all the information and documents related to the meetings to facilitate data references and searches. Board of Directorsû Self Assessment The Companyûs Board of Directors has the policy to evaluate the results of their own performances, taking the results of the Companyûs business operation, the degree of compliance to the established policies, and the overall economic and social situations as significant criteria. The self assessment outcome will be useful for self improvement in working of each individual director.

Report on Compliance to Corporate Governance Policy In 2007, the Company completely conformed to the Good Corporate Governance Policy stipulated by the Board of Directors. However, there are still some significant additional matters to be reported as detailed below : 1) and 2) Regarding the Rights of Shareholder and the Equitable Treatment of Shareholders 1. The Company completely and accurately reported its operation results to the shareholders and also arranged the shareholdersû meeting to report and request for the approval of issues which are significant or require resolutions from the meeting according to the law. 2. On February 15, 2007, the Company organized the Extraordinary Shareholdersû Meeting ; it was attended by 7 of the total 10 directors. Later on, on April 25, 2007, the General Shareholdersû Meeting was held ; attended therein were 9 of the total 10 directors. 3. The Company posted the invitation letter to the General Shareholdersû Meeting on its website (www.jasmine.com) 33 days prior to the meeting date. It also posted the Minutes of the Extraordinary Shareholdersû Meeting and the Minutes of the General Shareholdersû Meeting on the same website 12 and 13 days after the dates of the aforementioned meetings, respectively. 4. The Company had not yet allowed the shareholders to submit their opinions, recommendations, inquiries, additional agenda items or names of candidates for the position of director to the Company since it is, for the time being, considering the appropriate guidelines and the setting up of the policy related to the matters. 5. At the Extraordinary Shareholdersû Meeting, 16 shareholders assigned Dr. Vichit Yamboonruang, Dr. Varapol Socatiyanurak and Dr. Yodhin Anavil - the Companyûs independent directors - to vote on their behalves. In the like manner, 9 shareholders assigned Mr. Songrit Kusomrosananan and Mr. Somboon Patcharasopak - the Companyûs directors - to vote on their behalves. At the General Shareholdersû Meeting, 28 shareholders assigned Dr. Vichit Yamboonruang, Dr. Varapol Socatiyanurak and Dr. Yodhin Anavil - the Companyûs independent directors - to vote on their behalves 6. In the shareholderûs meeting, all the shareholders were equitably allowed to express their opinions and raise questions to any of the management attending the meeting. Voting portion for any agenda resolution was compliant to the following regulations : A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

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1. In a normal case, the resolution is subject to the majority vote of the eligible shareholders who attend the meeting. One share is entitled to one vote. However, the chairman of the meeting has the casting vote in case of tie. 2. In the following cases, at least three-forth of the total votes of the eligible shareholders attending the meeting are required subject to one share for one vote : 2.1 The total or partial sales or transfer of the Companyûs significant business operation to any third party. 2.2 The purchase or undertaking of any companies or private sectors, and 2.3 The execution, amendment, or cancellation of the partial or total lease of the Companyûs business to any third party, or business merger with any third party aiming for mutual profit and loss sharing. 7. In 2007, the Company complied with the policy on the protection of the inside information usage. Details of such policy is shown in the section of Management, subsection 5 : Control of Inside Information Usage and subsection 6 : Internal Auditing, part 3 : Control of Management Operation. 3) Regarding the Role of Stakeholders Provided that there is a case in which a stakeholderûs right is violated by the Company, the Company shall do everything in compliance with the law. Besides, a shareholder can submit a complaint or inform the Company of a trace of such matter at www.jasmine.com, çContact Usé menu. However, in the previous year, no case of violation of the shareholdersû right occurred nor did the conflict between the Company and the stakeholders. 4) Regarding the Disclosure and Transparency The Companyûs disclosure of the financial and the non-financial information was complete, correct, transparent and timely in conformity with the regulations stipulated by the Securities and Exchange Commission and the Stock Exchange of Thailand. Therefore, the Company was not penalized by both the Securities and Exchange Commission and the Stock Exchange of Thailand for the incapability to complete their regulations. The information disclosure to the Stock Exchange of Thailand was posted on the Companyûs website (www.jasmine.com) of the çInvestor Relation/news to SETé menu. The remuneration for management is herein disclosed in the section of Management, subsection 3 : Remuneration for Management. Such remuneration has passed the prudent consideration of the Board of Directorsû meeting which took into account the remuneration information of other companies belonging to the similar group of industry as references as well as the Companyûs own business expansion and growth of profits. It has also been approved by the shareholdersû meeting. As for salary, bonus and other rewards of the management and the employees, it is considered mainly based on the Companyûs operating results. The task of Investor Relations has been trusted to the Accounting and Finance Department. The contact person is Mrs. Churnkamol Treesuttacheep, telephone : 0-2100-3085, email address : churnkamolt@jasmine.com. Meanwhile, the disclosure of significant data of the Company is assigned to the Administration Department. The contact person is Mrs. Uraiporn Charoenchit, telephone : 0-2100-3118, email address : curaiporn@jasmine.com.

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5) Regarding Responsibilities of the Board of Directors 1. Of the total 10 directors who constitute the Companyûs structure of the Board of Directors, 4 of whom are the independent directors whose qualifications meet both the Companyûs definition and the standard of the Securities and Exchange Commission. The 4 independent directors are of not less than one-third of the total number of the directors in the Board. Three of the independent directors who are qualified according to the requirements of the Stock Exchange of Thailand are also positioned in the Companyûs Audit Committee, having independent power in the audit administration. The Company has clearly delineated the roles and responsibilities of the Board of Directors and the management. There is a practical organization structure in which the management power is delegated to the employees of all levels, enabling them to participate in the Companyûs operations and adroitly perform their duties. The scope of authorities and budgetary approval for each management level are clearly explicated in writing. The Company has clearly segregated authorities and roles between the Chairman and the President so as to prevent the unlimited authority. The Chairman of the Company is a director who is elected and appointed by the Board of Directors; whereas, the President is recruited, selected and appointed by the Executive Committee (as per details in the section of Management, subsection 1 : Management Structure). 2. The Company discloses its Corporate Governance Policy via the website (www.jasmine.com) at the Investor Relations/Corporate Governance Policy menu for the acknowledgement of the directors, employees and investors in general. 3. The Company has set up and put in writing the business operation policy and procedures, which are prudent and malfeasance-preventive in terms of payment requisition, procurement, personnel management and general administration. In addition, the Company has established the Code of Business Ethics as a vital guideline in business operation for the Board of Directors, the management and the employees of all levels as detailed below : 1. To adhere to fine virtues and morals. 2. To be self-disciplined, to be well aware of their own duties, to respect the rights of their own and othersû, and to realize that discipline upkeep is a kind of behavior improvement not punishment 3. To perform any legal duties assigned with fidelity and ethical judgement ; and to keep the Companyûs image unblemished 4. Not to directly or indirectly have a deliberate intention to harm, destroy or erode other personsû reputation, progress or business 5. To implement the leadership skill in business operation by utilizing the employeesû proficiency as a tool to achieve the organizationûs success, not for personal interests. 6. Should there be a personal interest, the fact of such interest is to be immediately reported to the Company, and the employees ought not to get involved in other business activities that may lead to a conflict of interest or deteriorate their work efficiency. 7. To create the work atmosphere that encourages opinion exchanges, creativity, innovative ideas, suggestions as well as sensible, righteous and impartial decision making 8. Not to disclose confidential information obtained by authority for own benefits, or to implement the same in the manner that may damage the Companyûs reputation 9. To always realize that, in business operation, one does not commit only to his own duties or the business owner, but also to the purchasers, suppliers, shareholders, customers and employees; therefore, mutual benefits of these groups become the major guideline of the business operation as a whole A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

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10. To be responsible for the performances of oneself and subordinates 11. To seek, improve and increase the personal capability and perform duties with knowledge, proficiency, and appropriate standard as being set for the position with attentiveness and responsibility for oneûs and the Companyûs progress. 12. To plan, set up and analyze work objectives to achieve the Companyûs goal while heeding the moral and professional ethics as well as the culture of relevant parties in the organization. 13. To maintain and be attentive to the health, security, bio-hygiene and environment of the whole organization, and to keep the work place in a tidy, exquisite and healthful condition 14. To maximize the effective and efficient deployment of the Companyûs resources 4. Six Board of Directorsû meeting were held in 2007. Each time, it was attended by all the directors, except General Tienchai Sirisumpan. 5. The Company has set up the Audit Committee to consider and verify details of the related work prior the submission to the Board of Directors. The Audit Committee is scheduled for a meeting once a quarter. In the year 2007, there were 4 meetings in which all the Audit Committee members attended. Below are the duties and responsibilities of the Audit Committee : 1. To verify the quarterly and annual financial reports before further submit them to the Board of Directors for consideration. The Audit Committee focuses mainly on the Companyûs accurate report on its conformity to the accounting standard, transactions between related companies as well as transactions that may cause conflicts of interest. This is to ensure that the financial report is prepared in compliance with the generally certified accounting principles, approved by the auditor according to the international accounting standard, and verified by the Audit Committee whose members are experts in accountancy and audit. 2. To consult and consider the scope, plan and audit report of the Office of Internal Audit who have carried out the internal audit according to the annual audit plan approved by the Audit Committee in order to assess the efficiency and effectiveness of the over-all internal audit system under a reasonable cost 3. To suggest comments to the management and the Board of Directors to generate a properly and prudentially internal audit system 4. To propose a list of external auditors to the Board of Directors for appointment and fix their remuneration and further submit to the shareholders for an approval in the Annual General Shareholdersû Meeting 5. To verify that the Company has performed in compliance with ethical rules and regulations stipulated for listed companies according to the notification of the Stock Exchange of Thailand, and perform according to the stateûs regulations 6. To verify and avoid conflict of interest 7. To verify that the information sent to the regulators e.g. the Office of Securities Exchange Commission and the Stock Exchange of Thailand, is accurate and in line with the information disclosed in the financial statement 8. To prepare the Audit Committee report signed by Chairman of the Audit Committee for disclosure in the Companyûs Annual Report 9. To make sure that the Company has maintained its cash flow at an elevated level, enhancing the favorable chances to repay the debt at the amount beyond that stipulated in the Debt Restructuring Agreement, to help boosting the Companyûs creditability 10. To perform other tasks as assigned by the Board of Directors 48

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The Company has also set up the Risks Management Committee with the following authorities and duties : 1. To stipulate the Risk Management framework and policy 2. To create Risk Management strategy and ensure that the risk management of the whole group are accomplished by focusing on the increment of Risk awareness 3. To examine, follow up, evaluate and improve the Risk Management plan to decrease the risks to be at the appropriate level 4. To report regularly to the Board of Directors of the Company the matter that needs improvement in order to comply with the designated policies and strategies 6. The Company has established the Office the Internal Audit in accordance with the regulations of the Stock Exchange of Thailand to ensure that the Companyûs and its subsidiariesû operations comply with the Companyûs rules and regulations. It also encourages employees of all levels to perform their jobs efficiently and effectively with environmental and ethical consciousness. An internal auditors is responsible for the analysis, assessment, suggestions, consultation and information provision, which serve as working tools, as well as leverage the efficiency of the internal audit system with the cost-effective budget. The proceeding of internal audit includes testing and assessment of the efficiency of the internal audit system as well as the quality of the internal work performance, hence, the responsibilities of the internal auditors are as follows : 1. To verify and report the reliability, completeness, operations, judgment standard, and examination 2. To ensure that the work system, which has significant impacts on the operations and reports, conforms to the Companyûs policies, operation plans, regulations, as well as related laws 3. To verify appropriateness of the Companyûs asset upkeep, exploitation, and existence inspection 4. To assess the exploitation of the Companyûs resources, aiming for the most efficient, effective and worthwhile results 5. To verify the business operation or business plan so as to ensure its compliance with the Companyûs objectives and targets, and the success of the work plan at the Companyûs supreme target 6. To suggest comments to the Audit Committee for proper improvement of the internal auditing system aiming for appropriateness and conciseness 7. To perform any other tasks assigned by the Audit Committee With regard to the Risks Management, please see more details in the section of Management, subsection 6 : Internal Audit, part 2 : Risks Management. 7. In 2007, the Board of Directors evaluated its own performance based on the self assessment of the directorsû form prepared by the Corporate Governance Center of the Stock Exchange of Thailand and sent to the Company for appropriate adaptation. It also reviewed the business operation policy and improved the business plan on a regular basis to increase efficiency of the management and the internal control system

5. CONTROL OF INSIDE INFORMATION USAGE The Company informed the directors and management to comply with all the rules and regulations of the Office of Securities Exchange Commission and the Stock Exchange of Thailand, especially for the report on changes in the Companyûs shares or securities holding in order to monitor and prevent them from using the inside information on their own interest. The Companyûs shares and securities held by directors and management, as well as any changes A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

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occurred shall be examined and reported at each Board of Directorsûmeeting. The Company, however, has not stipulated any extra controlling procedures other than those specified by SEC and SET, for this purpose.

6. INTERNAL AUDITING The Certified public accountant has conducted an audit and verification of the Company and its subsidiariesû financial statement as at December 31, 2007 and found nothing indicated that the said statements were materially incorrect in any way according to generally accepted accounting principles. The Company has caused the Audit Committee, as its duty, to conduct examinations and verification to build-up and enforce a suitable and effective internal auditing system, in order to protect the Company and its subsidiariesû assets from misuse by the employees, the management or by unauthorized person. The Audit Committee has not, to date, discovered any significant irregularities that have affected the operations of the Company. Furthermore, the Companyûs Board of Directors has assessed and opined on the self assessment questionnaires form regarding the adequacy and appropriateness of the Company and its subsidiariesû internal audit system in the 1/2008 Board of Directorsû Meeting held on 28 February 2008, as concluded below:Part 1: The Organization and its Environment The Companyûs internal structure and external environment are in good condition, enabling the internal auditing system to be implemented as effectively as desired by the Company. The Board of Directors has instituted clear, well-considered, and reasonable objectives, structures, and personnel incentives. A Code of Conduct has been put in writing and made part of the Companyûs policies and action plans. This code requires the management and employees conduct themselves so as not to become involved in conflicts of interest with the business of the Company. Rules and procedures are in place to govern the general conduct of the Companyûs affairs, prevent malfeasance, and ensure fair treatment of those engaged in transactions with the Company. Part 2: Risk Management The Company has appointed a Risk Management Committee comprises 8 members to impose the guideline and code of practice for risk management to each and every division by providing knowledge and direction regard the analysis, assessment, probability of impact occurrence, preventive measures including the monitoring both internal and external factors that could create any kind of risks to the Company i.e. foreign currency exchange rate, investment, legal impact and personnel. The Risk Management Committee is responsible for gathering and summarize all relevant information and propose to the Board of Directors quarterly However, for an urgent case, which requires an immediate action, the Risk Management Committee promptly report to the Chief Executive Officer to further propose to the Board of Directors for consideration and determination of corrective measures for the responsible parties to adopt and practice to alleviate the impact of such risk factors Part 3: Control of Management Operations The Company has clearly specified the scope of authority, the procedures to be followed, and the amount of funds disposable by directors and those in authority for each level of management. These rules have been compiled as a set of standard which are disclosed to all relevant staff and filed with the Department of Accounting and Finance. The staffûs duties have been clearly delineated and separated so that each may counter check each other. The operations of subsidiaries and joint ventures are likewise monitored and supervised according to the policies set by the Company, and controlled by means of meetings of the Executive Committee and other lesser committee meetings which must make progress reports at least once every three months. Moreover, the Company also takes care to ensure that any transaction made is in compliance with all relevant laws. The Company has not, to date, engaged in any action contrary to relevant law. 50

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited


The Company has set standards, procedures, and rules regarding transactions involving major shareholders, directors, management, and persons associated with them, including the redirection of corporate opportunities or advantages for personal interest. The Company has determined that all such matters should follow the rules, regulations and notification of the Stock Exchange of Thailand, which compel all transactions to be conducted on and equal footing with those conducted with outside parties, taking the interest of the Company to be paramount. Approvals of such transaction are to be made only by authorized persons who have no personal interest. These rules are to be deposited with every Company department and each subsidiary, and the Administration Department is deemed responsible for these types of transactions. The transactions approved by duly authority shall be monitored and supervised by the Administration Department so as to ensure that all proceedings are in accordance with the terms and conditions of the contract and such approval. Part 4: Information and Communication Systems When submitting a matter to the Board of Directors for consideration, the Company will ensure that the matter be disclosed to the Board of Directors not less than seven days prior to the meeting in a complete and easily comprehensible form. Minutes of every meeting shall also be completely recorded and easily comprehensible. If the Board of Directors agrees to a resolution unanimously, the Company has determined that details of the matter proposed, submitted for consultation, or inquired about will not be recorded. However, if directors have a significant difference of opinion or disagree with the matter under discussion, the Company will clearly record the disagreement, the reasons for such disagreement, and the results of a vote on the matter. The Board of Directors has not, however, had any significant difference of opinion to date. The Company keeps its books and records in accordance with generally accepted accounting principles and standards. Each department files its important documents in such a way that they can be easily accessed, referred to, and audited. Part 5: Monitoring System The Company keeps monitoring its operations performance and compares it to the business plan and budget approved by the Board of Directors at least once every three months. If any discrepancy is discovered, the Company has appropriate procedures to correct it in a timely manner. However, to date, the Company has not discovered any significant discrepancy. The Company has caused the office of internal audit to conduct internal audit in the Company on a regular basis, and to make report on its findings to the Audit Committee. To date, no significant discrepancies have been found. Moreover, it is the policy of the Company to cause the management to immediately report to the Board of Directors of any malfeasance of illegal action that could affect the Company没s reputation.

7. DIVIDEND PAYMENT POLICY The Board of Directors has the policy to submit for Shareholder Meeting没s consideration the dividend payment to general shareholders in the ratio of not less than 50% of the net profit after tax deduction each year. Regarding the dividend payment policy of the subsidiaries, Jasmine Telecom Systems Public Co.,Ltd. (JTS) has a policy to pay the dividend in the ratio of not less than 40% of the net profit after corporate tax deduction each year and such dividend payment must not significantly affect JTS general operation. However, provided that it is of necessity for JTS to use an amount of its net profit for further business expansion, JTS dividend may be paid in the ratio lower than stated above. For other subsidiaries, the payment depends on the liquidity of the cash flow in each year. A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

51


Related Party Transactions The Company entered the Related Party Transactions defined in the Notification of the Office of the Security and Exchange Commission and the Stock Exchange of Thailand. The transactions in 2007 were compliant with the terms and conditions of the contracts made between the Company and its subsidiaries on a normal business practice (as referred to in Clause 8 of the Notes to Financial Statements for the Year 2007.) The Company has reasonably proceeded for its own maximum benefits. The Audit Committee has reviewed the prices or ratio of such transaction with the Companyûs officers and internal auditors and considered that it was reasonable and that such transaction was accurately disclosed in the Companyûs Financial Statements. The approval procedure of related party transactions was carried out with the same criteria as the general procurement procedure. The management and the shareholders of the Company have neither interest in such transaction nor approval authority on such matter. Details are illustrated below. 1. In 2007, the Company and its subsidiaries executed the following transactions of products, services, and others with related parties: Related Parties

1. TT&T Public Co., Ltd. (çTT&Té) and TT&T Subscriber Services Co., Ltd., with 100% of shares held by TT&T

52

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

Relationship

Types of Transactions

1. The major stake, i.e. 29.85% ë STCC executed a procurement of shares, in TT&T, contract for computer equipment, system is held by JAS. design, and computer equipment 2. The Directors and Management installation and maintenance. of TT&T, who also share ë JTS supplied the communication their seats in JAS and telecommunication equipment, and 1. Mr. Songrit Kusomrosananan participated in and won the open bidding 2. Mr. Somsak Padhana-anek of TT&Tûs project. 3. Mr. Subhoj Sunyabhisithkul ë JasTel executed a contract for telecommunications network service. ë TTTBB executed a contract for the lease of network equipment. ë Ji-NET executed a High-Speed Internet Service contract wherein stated that the service charge was subject to the circuit speed. ë ACU supplied the High-Speed Signal under the Internet Protocol. ë SHW supplied leased circuits. ë PA executed a contract for the lease of office space at Jasmine International Tower, billboard, and other facility services.

Amount (Million Baht) As at December 31, 2007

73

84

32 1,148 41

16 12 16


Related Parties

Relationship

2. Mono Group, comprising 1. Mr. Pete Bodharamik is ë Mono Film Co., Ltd. the director and major shareholder of Mono Group. ë Mono Generation Co., Ltd. ë Mono Technology Co., Ltd. 2. Mr. Pete Bodharamik is ë Mono2U Co., Ltd. the major shareholder of JAS, holding 9.62% share.

3. Premium Real Estate Co., Ltd. (çPREé)

1. JAS, as the parent company, holds 49% share in PRE. 2. Mr. Somboon Patcharasopak is the director in both JAS and PRE.

Amount (Million Baht) As at December 31, 2007

Types of Transactions

ë PA executed a contract for the lease of office space at Jasmine International Tower, billboard, and other facility services. ë Ji-NET executed a High-Speed Internet Service contract wherein stated that the service charge was subject to the circuit speed. ë PA executed a contract for the lease of office space at Jasmine International Tower, billboard, and other facility services.

20

2

1

2. In the year 2007, the Company and its subsidiaries transacted the products and equipment procurement, including payment for leases and services from related parties as follows: Related Parties

1. TT&T Public Co., Ltd (çTT&Té) and TT&T Subscriber Services Co., Ltd. with 100% of share held by TT&T

Relationship

1. The major stake, i.e. 29.85% of shares, in TT&T, is held by JAS. 2. The Directors and Management of TT&T, who also share their seats in the JAS are: 1. Mr. Songrit Kusomrosananan 2. Mr. Somsak Padhana-anek 3. Mr. Subhoj Sunyabhisithkul

Types of Transactions

ë JasTel utilized the Rack service. ë SHW utilized the lease circuits service. ë Ji-NET utilized the Optical Fiber Cable Service. ë ARS utilized the testing, maintenance and repair services for network linkage. ë TTTBB utilized the Dslam network equipment. ë TTTBB purchased the Router and the ATA equipment to service the customers.

Amount (Million Baht) As at December 31, 2007

1 16 47 3 444 80

3. In 2007, the Company and its subsidiaries executed the following transactions of other service expenses with related parties: Related Parties

1. TT&T Public Co., Ltd. (çTT&Té) and TT&T Subscriber Services Co., Ltd., with 100% of shares held by TT&T

Relationship

Types of Transactions

1. The major stake, i.e. 29.85% ë TTTBB paid for sales promotion of shares, in TT&T, expense. is held by JAS. ë TTTBB utilized services for general 2. The Directors and Management administration and management. of TT&T, who also share their seats in the JAS are: 1. Mr. Songrit Kusomrosananan 2. Mr. Somsak Padhana-anek 3. Mr. Subhoj Sunyabhisithkul

Amount (Million Baht) As at December 31, 2007

2 108

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Management Explanation and Operation Results Analysis Operating results In year 2007 the Company and its subsidiaries没 total revenue was at Baht 4,633 million, decrease by Baht 1,215 million from the previous year or 21%. The decreases in sales and service income of Acumen Co., Ltd., Jasmine Telecom Systems PCL. and Siam Teltech Computer Co., Ltd. was caused the operating profit of the Company and its subsidiaries in 2007 to be at Baht 545 million, declining from the year 2006 of Baht 68 million or 11%. Including the loss sharing from TT&T PCL. of Baht 644 million this year (the loss sharing from TT&T in 2006 was at Baht 390 million), the Company and its subsidiaries showed a net loss of Baht 41 million compared with net profit of Bath 236 million in 2006. Details are as follows: Unit : Million baht

Operating profit Gain from sales of investment Gain on Exchange rate Share of loss from investments in associates Early redemption fee of Senior Notes Net profit (loss) EPS (Baht per share)

2007

2006

545 58 (644) (41) (0.005)

613 31 247 (390) (265) 236 0.028

% change (11) (100) (77) 65 (100) (117) (118)

Operating results breakdown by business unit The operating results for the year 2007 and 2006 by business unit are as follows : Unit : Million baht

Company name Telecom and Network Provider 1. Jasmine Submarine Telecommunications Co., Ltd. 2. Thai Long Distance Telecommunications Co., Ltd. 3. Acumen Co., Ltd. 4. Smart Highway Co., Ltd. 5. ACeS Regional Services Co., Ltd. 6. Jasmine Internet Co., Ltd. 7. JasTel Network Co., Ltd. 8. Triple T Broadband PCL. Total System Integration 1. Jasmine Telecom Systems PCL. 2. Siam Teltech Computer Co., Ltd. 3. Jasmine International PCL. 4. T.J.P. Engineering Co., Ltd. Total

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A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

2007

Total revenue 2006

% change

981 329 186 61 210 415 78 1,230 3,490

1,270 415 966 70 293 389 1 286 3,690

(23) (21) (81) (12) (28) 7 6,964 330 (5)

729 153 12 751) 969

1,589 370 20 461) 2,025

(54) (59) (43) 63 (52)


Unit : Million baht

Company name Other investments 1. Jasmine Smart Shop Co., Ltd. 2. Premium Assets Co., Ltd. 3. Others2) Total Grand Total Remark :

1) 2)

2007 137 37 174 4,633

Total revenue 2006 23 92 18 133 5,848

% change (100) 49 103 31 (21)

Backlog from the year 2005 Comprising of Jasmine International Overseas Co., Ltd., Mobile Communication Services Co., Ltd., Jasmine Cyber Work Co., Ltd., Compunet Corporation Co., Ltd. and ACeS (Thailand) Co., Ltd.

Total Revenue In year 2007, total revenue of the Company and its subsidiaries was at Baht 4,633 million, decreased by 21% from year 2006 which total revenue was at Baht 5,848 million. Details of total revenue are shown below: Unit : Million baht

Detail Sales and service income Gain on exchange rate Interest income Gain from sales of investment Other income Total revenue

2007

2006

4,331 58 147 97 4,633

5,275 247 181 31 114 5,848

% change (18) (77) (19) (100) (15) (21)

Sales and service income Sales and service income for the year 2007 was at Baht 4,331 million lowered from the previous year of Baht 944 million or 18%. The following are sales and service income breakdown by group of business.: Unit : Million baht

Business Group Network and service provider System Integration Other investments Total sales and service income

2007

2006

3,294 903 134 4,331

3,248 1,930 97 5,275

% change 1 (53) 38 (18)

The 18% declining in sales and service income in the year 2007 was from the declining in the system integration business. Comparing with the last year, sales and service income was around 53% lowered, this was because Jasmine Telecom Systems PCL. and Siam Teltech Computer Co., Ltd. The companies were under bidding and waiting for signing of some new projects. In 2007, sales and service income under telecom and network provider business was at Baht 3,294 million closed to the year 2006 which was at Baht 3,248 million. This was due to the increasing in contributions from Triple T Broadband PCL. and JasTel Network Co., Ltd. can recompense the decline in contribution from Acumen Co., Ltd. which the concession under the company was expired in June 2006. A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

55


Other income Other income in 2007 was Baht 302 million comprising of Baht 147 million interest income, Baht 58 million gain on exchange rate and others of Baht 97 million. Expenses Total expenses in 2007 was Baht 3,930 million, decrease of Baht 642 million or 14% compared with the previous year. A summary of expenses is as follow: Unit : Million baht

Detail Operating expenses : ë Cost of sales and service ë Selling and administrative expenses Total operating expenses Early redemption fee of Senior Notes Share of loss from investment in associates Total expenses

2007

2006

2,559 726 3,285 645 3,930

3,138 779 3,917 265 390 4,572

% change (18) (7) (16) (100) 65 (14)

ë Operating expenses was Baht 3,285 million, 16% lowered from year 2006 which was in line with the decreases in sales and service income of the Company and its subsidiaries. ë Share of loss from investment in associates was Baht 645 million compared with Baht 390 million in 2006. The amount including loss sharing from TT&T amounted of Baht 639 million. Interest expenses Interest expenses in 2007 were Baht 364 million, lowered from the previous year of Baht 80 million or 18%. This was due to the principal repayment of JAS and its subsidiary. Net profit (loss) In 2007, the Company and its subsidiaries showed a net loss of Baht 41 million compared with a net profit of Baht 236 million last year. Detail of net profit (loss) categorized by business unit are as follow: Unit : Million baht

Company name Telecom and Network Provider 1. Jasmine Submarine Telecommunications Co., Ltd. 2. Thai Long Distance Telecommunications Co., Ltd. 3. Acumen Co., Ltd. 4. Smart Highway Co., Ltd. 5. ACeS Regional Services Co., Ltd. 6. Jasmine Internet Co., Ltd. 7. JasTel Network Co., Ltd. 8. Triple T Broadband PCL. Total System Integration 1. Jasmine Telecom Systems PCL. 2. Siam Teltech Computer Co., Ltd. 3. Jasmine International PCL. 4. T.J.P.Engineering Co., Ltd. Total

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A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

2007

Net profit (Loss) 2006

% change

315 141 (52) 1 82 29 17 194 727

182 223 132 2 143 33 1 44 760

72 (37) (139) (29) (42) (14) 3,280 335 (4)

46 (13) (184) (4) 1) (155)

180 6 (218) (1) 1) (33)

(75) (313) (16) 260 371


Unit : Million baht

Company name

2007

Other investments 1. TT&T PCL. 2. Jasmine International Overseas Co., Ltd. 3. ACeS (Thailand) Co., Ltd. 4. Premium Asset Co., Ltd. 5. Jasmine Smart Shop Co., Ltd. 6. Compunet Corporation Co., Ltd. 7. Others2) Total Net profit (loss) Remark :

Net profit (Loss) 2006

(639) (15) (19) 29 29 2 (613) (41)

(382) (65) (63) 5 10 (7) 11 (491) 236

% change 67 (77) (70) 484 (100) (525) (82) 25 (118)

1)

backlog from the year 2005 2) Comprising of Mobile Communication Services Co., Ltd., Jasmine Cyberwork Co., Ltd., Chaengwatana Planner Co., Ltd. and Pakkred Planner Co., Ltd.

Financial Position Assets As of December 31, 2007, the company and its subsidiaries had total assets of Baht 14,979 million, decrease of Baht 2,460 million from the previous year or 14%. Total assets comprised of: Detail Current assets Property, plant and equipment, net Other non-current assets

December 31, 2007 Baht million % to Total Asset 6,554 3,506 4,919

44 23 33

December 31, 2006 Baht million % to Total Asset 8,043 3,522 5,875

46 20 34

Current assets in 2007 were declining from the last year of Baht 1,489 million or 19%. This was mostly due to the decrease in cash and cash at financial institution of Baht 1,263 million from the principal repayment under the company and its subsidiary. Decrease in other current asset apart from cash such as account receivable, inventory and others was in accordance of the declining growth of revenue. Other non-current assets in 2007 declined by Baht 956 million from the previous year, this was resulted from declining in book value of investment in TT&T PCL. amounted Baht 643 million as to the loss sharing. Liabilities As of December 31, 2007 total liabilities was at Baht 6,142 million, Baht 1,891 decreasing from the prior year. The total liabilities comprised of: Detail Current Liabilities (exclude current portion of long term debt) Long Term Liabilities

December 31, 2007 Baht million % to Total Liabilities

December 31, 2006 Baht million % to Total Liabilities

2,304

38

2,189

27

3,838

62

5,844

73 A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

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Current Liabilities was Baht 2,304 million at the end of 2007, increasing from the year 2006 of Baht 115 million. Account payable was increasing whereas the short term loan and other current liabilities was declining. Long term liabilities was Baht 3,838 million declined from the prior year of Baht 2,006 million due to the loan repayment of JAS and its subsidiary. Shareholdersû Equity At the end of 2007, the Consolidated Shareholdersû Equity was at Baht 8,837 million, lowered from the year 2006 which the Shareholdersû Equity was at Baht 9,407 million, decreasing by 6%. This was came from the net loss in the year of Baht 41 million and dividend paid to the shareholders of JAS amounted Baht 124 million. Capital Structure Capital structure as of December 31, 2007 consisted of total liabilities of Baht 6,142 million or 41% and shareholdersû equity of Baht 8,837 million or 59%. Debt to equity ratio as of December 31, 2007 was 0.70 times.

Liquidity Cash and cash equivalents as at December 31, 2007 was at Baht 3,418 million, a Baht 1,156 million decrease from the previous year. Net cash from and used in other activities are as follows: ë Net cash from operating activities amounted to Baht 1,893 million. ë Net cash used in investing activities amounted to Baht (554) million. ë Net cash used in financing activities amounted to Baht (2,495) million.

Treasury Stock Program for financial management On 28 February 2007, the Board of Director Meeting of Jasmine International PCL. has approved Treasury Stock Program for financial management in the amount not more than 831,990,715 shares (at par value of 1 Baht per share) or not more than 10% of the total paid-up capital. The maximum amount of the share repurchased will not exceeding 300,000,000 Baht. The Company repurchased its shares in the Stock Exchange of Thailand commencing from 15 March 2007 to 14 September 2007 (6 months). On 14 September 2007, the Company notified the completion of the share repurchase program. The total shares repurchased were 634,400,000 shares or 7.625% of total paid-up capital with total amount of 299,995,635 baht achieving the maximum amount of the Treasury Stock Program. According to the ministerial regulation on the shares repurchased, resale of the shares and the shares written off, 2001 defines the Company to resale the repurchased shares after 6 months from the completion date of the share repurchase but no later than 3 years from such period (period of the resale of share is from 15 March 2008 to 14 September 2010). Provided that any shares remain unsold after the ending of share resale period, the Company will decrease the capital by writing off such unsold shares. According to the regulation of The Office of the Securities and Exchange Commission, the Company has to appropriate an equal amount of retained earnings to reserve for treasury shares, the amount must be maintained until the Company either sells the treasury shares or written off those unsold shares. As of 31 December 2007, the Company has already appropriated the full required amount of retained earnings to a reserve for the treasury shares.

Audit Fee The Company and its subsidiaries paid the audit fee to Ernst & Young Office Limited in the previous fiscal year totaling of Baht 6,710,000.Non - audit fee The subsidiary paid the non - audit fee which was the consulting fee for preparation of filing in TTTBB for the meeting and discussion with the Securities and Exchange Commission to Ernst & Young Office Limited in the previous fiscal year totaling of Baht 240,000.58

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited


Consolidated Total Assets & Equity

Revenues from Sales & Service (2007)

Million Bath 18,000

17,440 16,600 14,979

15,000

JTS (C) 9% 12,000 9,407

8,837

8,486

9,000

JSTC (C) 30%

JI 0% T.J.P. 2% ARS 5%

6,000 JI-net 9% 3,000 0

2005

2006

Total Assets

2007

ACUMEN (C) 35%

Equity

Number of Employee in Jasmine International Group

Sales & Net Profit Million Bath 7,000

1,200

6,655

1,033 6,000

1,000

5,275 5,000

942

925

800

4,331 4,000

573

600

594

552

3,000 400 2,000

323 250

200

864

1,000

137

224 124

123

236 0

0 (41)

2005

2006

2007

(1,000)

2005 Sales

2006

2007 Net Profit

Engineer

Technician

Administration & General

Total

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

59


JASMINE INTERNATIONAL PUBLIC COMPANY LIMITED AND ITS SUBSIDIARIES

REPORT AND CONSOLIDATED FINANCIAL STATEMENTS 31 DECEMBER 2007 AND 2006

60

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The Responsibility for the Financial Reporting of the Board of Directors The financial statement of Jasmine International PCL. and its subsidiaries have been prepared under the policy of the directors to comply with generally accepted accounting standards. In preparing the financial statements, the Company and its subsidiaries have used appropriate accounting policies, consistently applied and support by reasonable and prudent judgment and estimates, and that all applicable accounting standards have been followed to give a true and fair view of the state of affairs of the Company and its subsidiaries. The Board of Directors also set up and maintained on effective internal audit system to ensure that the Company and its subsidiaries keep accounting records which disclose with reasonable accuracy, completeness and adequacy the financial positions of the Company and its subsidiaries to safeguard the assets of the Company and its subsidiaries and to prevent and detect fraud and other substantial irregularities. In so doing, the Board of Directors appointed the Audit Committee, which consists of non-executive directors, to supervise and take responsibility of the quality of the financial statements and the internal audit system. The options of the Audit Committee are stated in the report of the Audit Committee in this annual report. The Board of Directors is of the opinion that the Company没s internal audit system is generally satisfactory and should enhance the creditability of the consolidated financial of the Company and its subsidiaries as of December 31, 2007

(Mr. Songrit Kusomrosananan) Chief Executive Officer

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Audit Committee Report The Audit Committee of Jasmine International Public Company Limited consists of three independent non-executive directors, namely, Dr. Vichit Yamboonruang as Chairman, Dr. Varapol Socatiyanurak and Dr. Yodhin Anavil as Committee members. It supervises the Companyûs operation as directed by the charter of the Audit Committee. In the fiscal year 2007, without any interference, the Audit Committee completely carried out its assigned duties and accordingly reported them to the Board of Directors. In each Audit Committee meeting, the Committee discussed the issues with the Companyûs top executives, the executives from the Office of Internal Audit and the auditors. The tasks accomplished by the Audit Committee during the year 2007 are summarized as follows: ë The review of the quarterly and annual financial statements of the Company as well as the consolidated financial statement of the Company and its subsidiaries prior to the submission to the Board of Directors, the Securities and Exchange Commission and the Stock Exchange of Thailand The cautiously done review of the quarterly and annual financial statements of the Company, the consolidated financial statement of the Company and its subsidiaries, including notes to the financial statements by the Companyûs auditors and management ensured the Audit Committee that the above-mentioned financial statements were fairly presented in compliance with the generally accepted accounting principles and were also sufficiently disclosed. ë The evaluation of the appropriateness and adequacy of the Companyûs internal control system and the provision of opinions on the results of internal audit through the supervision of the Office of Internal Audit and the audit of the Companyûs auditors The Audit Committee discussed with the Companyûs auditors and internal auditors on significant recommendations which would enhance efficiency increase in the Companyûs operation and internal control system for the management. ë The approval of the 2008 audit plan prepared based on risk evaluation outcomes, covering all the important systems of the Company and its subsidiaries ë The review and the follow-up of risk management outcomes of the Company and its subsidiaries The Risk Management Committee evaluated risks which might have significant adverse effects on the Companyûs business goal achievement and also set up the preventive and solving measures for them. ë The review of the related party transactions of the Company and its subsidiaries in accordance with the Stock Exchange of Thailandûs regulations Having reviewed the related party transactions of the Company and its subsidiaries, the Audit Committee has the opinion that such transactions were reasonably and truly done for the utmost benefits of the Company with all the general business terms and conditions fulfilled apart from the accurate and adequate information disclosure. ë The provision of advice for the management on the Companyûs operation to strengthen good corporate governance to fit with the guidelines of the Stock Exchange of Thailand in addition to the provision of reminders on various aspects the Company had to perform in compliance with the rules and regulations of the authorities supervising public companies The Audit Committee proposed to the Companyûs Board of Directors to appoint Ernst & Young Office Limited as the Companyûs auditor for the year 2008.

Dr. Vichit Yamboonruang Chairman of the Audit Committee 62

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited


Report of Independent Auditor To the Shareholders of Jasmine International Public Company Limited

I have audited the accompanying consolidated balance sheet of Jasmine International Public Company Limited and its subsidiaries as at 31 December 2007, the related consolidated statements of income, changes in shareholders没 equity and cash flows for the year then ended, and the separate financial statements of Jasmine International Public Company Limited for the same period. These financial statements are the responsibility of the management of the Company and its subsidiaries as to their correctness and the completeness of the presentation. My responsibility is to express an opinion on these financial statements based on my audit. I did not audit the financial statements of TT&T Public Company Limited, an associated company, whose financial statements were included in the consolidated financial statements. The consolidated balance sheet of the Company and its subsidiaries as at 31 December 2007 included investments in the associated company accounted for using the equity method totaling Baht 2,923 million and the related consolidated statement of income for the year then ended included share of loss from the associated company totaling Baht 637 million. The financial statements of the associated company were audited by another auditor, whose report dated 18 February 2008, have been furnished to me. My report herein, insofar as it relates to the amounts included for the associated company in the consolidated financial statements is based solely on the reports of that auditor. The consolidated financial statements of Jasmine International Public Company Limited and its subsidiaries and the separate financial statements of Jasmine International Public Company Limited as at 31 December 2006 and for the year then ended, as presented herein for comparative purposes, were audited in accordance with generally accepted auditing standards by another auditor of our firm who expressed an unqualified opinion on those statements, under her report dated 28 February 2007, based on her audit and the report of another auditor, but drew attention as described in Note 6.1 and Note 14.4 to the financial statements. In addition, the auditor of the associated company drew attention as described in Note 14.5 to the financial statements. I conducted my audit in accordance with generally accepted auditing standards. Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. I believe that my audit and the reports of another auditor referred to in the first paragraph provide a reasonable basis for my opinion. In my opinion, based on my audit and the report of another auditor, the financial statements referred to above present fairly, in all material respects, the financial position of Jasmine International Public Company Limited and its subsidiaries and of Jasmine International Public Company Limited as at 31 December 2007, and the results of their operations, and cash flows for the year then ended, in accordance with generally accepted accounting principles. Without qualifying my opinion on the above financial statements. I draw attention to the following matters: 1. As described in Note 14.4 to the financial statements, as at 31 December 2007 the net book value of the investments of the Company and its subsidiaries in the associated company, totalled Baht 2,923 million, and that of the Company only totalled Baht 2,604 million, while the total market values of these investments amounted to Baht 871 million and Baht 729 million, respectively. No allowance for the difference in value has been set aside against the investments since the management believes that the present value of the benefits to be derived from these investments in the future exceeds the above carrying values. Nevertheless, there are uncertainties in respect of the matter and dispute described in Note 14.5 to the financial statements, which may have a material impact on the realisable value of such investments. A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

63


2. As described in Note 6 to the financial statements, whereby on 7 August 2003, the Central Bankruptcy Court approved the business rehabilitation plan of the Company and subsequently, on 14 September 2006, the Court issued an order to terminate the business rehabilitation of the Company. However, certain creditors lodged objections to certain issues with the Supreme Court, and the issues are being considered by the Supreme Court. The Company believes that these issues will not have any impact on the financial statements of the Company. 3. As described in Note 33.9 to the financial statements, a subsidiary company entered into two turn-key agreements with TOT PCL., the subsidiary is obliged to deliver work within specific periods stipulated in the agreements. The subsidiary has been unable to make delivery within the stipulated period. TOT PCL. is therefore entitled to charge a penalty to the subsidiary at a rate of 0.1 percent of the contract value (Baht 87 million and Baht 34 million, respectively). However, the management of the subsidiary is in the process of requesting an extension of the deadline for delivery and they believe that negotiations for such extension will be successful, because the delays were caused by a delay in the delivery of an area by a related government agency, and no penalty will be imposed. 4. As described in Note 4 to the financial statements whereby, effective in 2007, the Company changed its accounting policy for recording investments in subsidiaries and associates in the separate financial statements from the equity method to the cost method. The Company has thus restated the separate financial statements as at 31 December 2006 and for the year then ended to reflect this accounting change. 5. The auditor of the associated company draw attention to the financial statements, under her report dated 18 February 2008, of the associated company and its subsidiaries in respect of the following matters, as described in Note 14.5 to the financial statements. a) For the year ended 31 December 2007, the associated company incurred operating losses of Baht 2,041 million and the associated company and its subsidiaries incurred operating losses of Baht 2,028 million. As at 31 December 2007, the associated company没s current liabilities exceeded its current assets by Baht 3,643 million and current liabilities of the associated company and its subsidiaries exceeded their current assets by Baht 3,792 million. The associated company has defaulted on payment of principal amounting to approximately Baht 1,915 million due on 30 June 2007 and 31 December 2007 and has default interest payable, calculated up to 31 December 2007, amounting to Baht 29 million. The associated company is currently negotiating with its creditors. Nevertheless, the situation is uncertain and may affect the success of the associated company没s future operations and its ability to generate sufficient cash flows from operations to meet the conditions of the loan agreements. These factors indicate the existence of a material uncertainty which may cast significant doubt on the associated company没s ability to continue as a going concern. b) The associated company earns income from other value added services, for which some of the sharing rates are under negotiation and/or arrangement with TOT PCL. c) The associated company has ongoing disputes with TOT PCL., of which the outcome cannot presently be determined.

Supachai Phanyawattano Certified Public Accountant (Thailand) No. 3930 Ernst & Young Office Limited Bangkok: 28 February 2008

64

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited


JASMINE INTERNATIONAL PUBLIC COMPANY LIMITED AND ITS SUBSIDIARIES

BALANCE SHEETS AS AT 31 DECEMBER 2007 AND 2006

Consolidated financial statements Note

2007

2006

(Unit: Baht) Separate financial statements 2007

2006 (Restated)

ASSETS CURRENT ASSETS Cash and cash equivalents Current investments - deposits with financial institutions Trade accounts receivable Related parties Unrelated parties Total trade accounts receivable Less: Allowance for doubtful accounts Total trade accounts receivable - net Short-term loan to and amounts due from related parties Inventories - net Other current assets Prepaid project costs Unbilled receivable - related party Unbilled receivable - unrelated parties Dividend receivable from subsidiary Advance payments for goods and services Retention receivable Other receivable Withholding tax Vat refundable Input tax pending payments Others Total other current assets TOTAL CURRENT ASSETS

3,418,036,348

4,573,804,808

359,085,258

977,388,121

7

535,187,373

642,400,329

24,580,487

20,868,991

8, 9 9

968,248,467 965,602,368 1,933,850,835 (83,871,965) 1,849,978,870

716,843,379 1,378,904,637 2,095,748,016 (86,382,792) 2,009,365,224

70,040,630 70,040,630 (56,388,239) 13,652,391

218,066,917 218,066,917 (60,252,346) 157,814,571

9,508,691 79,655,411

904,986 95,068,531

298,641,215 -

309,993,703 -

67,788,300 150,332,216 120,021,122 38,052,457 23,533,470 85,441,181 66,568,696 9,507,478 50,308,787 49,946,786 661,500,493 6,553,867,186

67,605,850 176,784,221 78,370,278 40,635,046 88,185,485 63,263,130 50,076,912 73,288,052 24,541,853 58,670,439 721,421,266 8,042,965,144

588,505 1,399,994,895 23,295,380 125,550 43,988,547 1,166,527 1,302,175 1,470,461,579 2,166,420,930

7,479,938 6,638,188 86,853,645 165,470 36,829,058 1,102,203 1,770,919 140,839,421 1,606,904,807

9

8 10

8 8

The accompanying notes are an integral part of the financial statements.

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

65


JASMINE INTERNATIONAL PUBLIC COMPANY LIMITED AND ITS SUBSIDIARIES

BALANCE SHEETS (Continued) AS AT 31 DECEMBER 2007 AND 2006

Consolidated financial statements Note

2007

2006

(Unit: Baht) Separate financial statements 2007

2006 (Restated)

NON-CURRENT ASSETS Restricted deposits with financial institutions Investments in dissolved subsidiaries - net Investments in subsidiaries - net Investments in associates - net Investments in other companies - net Property, plant and equipment - net Leasehold rights - net Assets held for sale Other non-current assets Advance payments for investment projects to related parties - net Deferred project costs - net Excess of cost of investments over net assets value of subsidiaries - net Others Total other non-current assets TOTAL NON-CURRENT ASSETS TOTAL ASSETS

11 12 13 14 15 16 17 18

480,666,929 51,338,990 2,933,091,119 3,452,582,932 53,581,518

434,398,459 51,338,990 3,576,053,399 3,468,381,763 53,581,520

40,506,301 51,338,990 2,994,162,008 2,621,220,727 5,573,574 284,743,083 -

40,478,945 51,338,990 2,994,162,008 3,150,731,673 3,392,738 298,562,250 -

8 19

33,780,742 1,324,586,466

33,780,742 1,675,084,079

33,780,742 -

33,780,742 -

20

88,856,582 7,074,715 1,454,298,505 8,425,559,993 14,979,427,179

96,394,959 8,092,128 1,813,351,908 9,397,106,039 17,440,071,183

3,219,572 37,000,314 6,034,544,997 8,200,965,927

3,213,572 36,994,314 6,575,660,918 8,182,565,725

The accompanying notes are an integral part of the financial statements.

66

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited


JASMINE INTERNATIONAL PUBLIC COMPANY LIMITED AND ITS SUBSIDIARIES

BALANCE SHEETS (Continued) AS AT 31 DECEMBER 2007 AND 2006

Consolidated financial statements Note

2007

2006

(Unit: Baht) Separate financial statements 2007

2006 (Restated)

LIABILITIES AND SHAREHOLDERS没 EQUITY CURRENT LIABILITIES Bank overdrafts and short-term loans from banks 21 Trade accounts payable Related parties 8 Unrelated parties Total trade accounts payable Current portion of accounts and notes payable for equipment 22 Current portion of long-term loans 23 Current portion of long-term debts under rehabilitation plan Related parties 6, 8 Unrelated parties 6, 24 Total current portion of long-term debts under rehabilitation plan Amounts due to related parties 8 Other current liabilities Advances received from related party 8 Advances received from unrelated parties Corporate income tax payable Accrued project costs Accrued expenses Undue output tax Retention payable Other payable Others Total other current liabilities TOTAL CURRENT LIABILITIES NON-CURRENT LIABILITIES Accounts and notes payable for equipment net of current portion 22 Long-term loans net of current portion 23 Long-term debts under rehabilitation plan net of current portion Related parties 6, 8 Unrelated parties 6, 24 Total long-term debts under rehabilitation plan net of current portion Other non-current liabilities TOTAL NON-CURRENT LIABILITIES TOTAL LIABILITIES

324,367,676

387,394,194

-

-

571,077,860 739,867,344 1,310,945,204

254,426,120 698,192,103 952,618,223

16,050,000 80,780 16,130,780

16,050,000 1,688,137 17,738,137

311,186,078 761,600,000

299,152,359 812,000,000

-

-

28,134,029

566,906,077

117,668,083 28,134,029

94,135,578 566,906,077

28,134,029 23,744,784

566,906,077 76,183,199

145,802,112 16,699,449

661,041,655 11,394,954

106,536 88,719,741 136,649,924 205,104,093 47,870,779 78,186,592 25,076,869 23,778,691 39,600,069 645,093,294 3,405,071,065

11,599,102 87,605,144 203,897,997 214,565,970 51,847,780 82,522,276 28,480,460 12,103,010 79,897,787 772,519,526 3,866,773,578

2,957,048 4,703,054 4,852,582 259,237 2,282,777 2,382,080 17,436,778 196,069,119

4,539,017 2,206,492 7,675,125 18,047,212 800,577 955,266 11,470,753 45,694,442 735,869,188

329,460,556

663,197,060

-

-

1,332,800,000

2,142,768,000

-

-

1,063,528,128

1,355,250,906

706,120,172 1,063,528,128

729,652,677 1,355,250,906

1,063,528,128 11,386,628 2,737,175,312 6,142,246,377

1,355,250,906 4,911,914 4,166,127,880 8,032,901,458

1,769,648,300 9,146,525 1,778,794,825 1,974,863,944

2,084,903,583 8,628,875 2,093,532,458 2,829,401,646

The accompanying notes are an integral part of the financial statements. A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

67


JASMINE INTERNATIONAL PUBLIC COMPANY LIMITED AND ITS SUBSIDIARIES

BALANCE SHEETS (Continued) AS AT 31 DECEMBER 2007 AND 2006

Consolidated financial statements Note

2007

2006

(Unit: Baht) Separate financial statements 2007

2006 (Restated)

SHAREHOLDERSรป EQUITY Share capital Authorised share capital 15,485,673,420 ordinary shares of Baht 1 each Preferred shares non-cumulative dividend 2.5% 200,000,000 shares of Baht 1 each Issued and fully paid-up 8,319,907,163 ordinary shares of Baht 1 each Warrants 25 Discount on ordinary shares Capital surplus from share premium of subsidiary 13.3 Unrealised gain on changes in value of investments in available-for-sale securities Retained earnings Appropriated Statutory reserve - the Company 26 - subsidiaries 26 Treasury shares reserve 27 Unappropriated (deficit) EQUITY ATTRIBUTABLE TO THE COMPANYรปS SHAREHOLDERS LESS: TREASURY SHARES 27 EQUITY ATTRIBUTABLE TO THE COMPANYรปS SHAREHOLDERS - NET MINORITY INTEREST - equity attributable to minority shareholders of subsidiaries TOTAL SHAREHOLDERSรป EQUITY TOTAL LIABILITIES AND SHAREHOLDERSรป EQUITY

15,485,673,420

15,485,673,420

15,485,673,420

15,485,673,420

200,000,000 15,685,673,420

200,000,000 15,685,673,420

200,000,000 15,685,673,420

200,000,000 15,685,673,420

8,319,907,163 26,074,479 (1,757,699,267) 50,720,577

8,319,907,163 26,074,479 (1,757,699,267) 51,799,272

8,319,907,163 26,074,479 (1,757,699,267) -

8,319,907,163 26,074,479 (1,757,699,267) -

2,468,700

1,899,000

-

-

83,076,226 276,982,930 300,745,624 864,497,058

83,076,226 214,437,311 1,392,741,833

83,076,226 300,745,624 (445,256,618)

83,076,226 (1,318,194,522)

8,166,773,490 (300,745,624)

8,332,236,017 -

6,526,847,607 (300,745,624)

5,353,164,079 -

7,866,027,866

8,332,236,017

6,226,101,983

5,353,164,079

971,152,936 8,837,180,802 14,979,427,179

1,074,933,708 9,407,169,725 17,440,071,183

6,226,101,983 8,200,965,927

5,353,164,079 8,182,565,725

The accompanying notes are an integral part of the financial statements.

68

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited


JASMINE INTERNATIONAL PUBLIC COMPANY LIMITED AND ITS SUBSIDIARIES

INCOME STATEMENTS FOR THE YEARS ENDED 31 DECEMBER 2007 AND 2006

Consolidated financial statements Note

2007

2006

(Unit: Baht) Separate financial statements 2007

2006 (Restated)

REVENUES Sales and service income Other income Management fee income Interest income Gain on sales of investments in available-for-sale securities Exchange gains Dividend income from subsidiaries 13 Others Total other income TOTAL REVENUES EXPENSES Cost of sales and service Selling, servicing and administrative expenses Fee for early redemption of senior secured notes 23 Loss on impairment of investment Allowance for doubtful accounts for short-term loan to and amounts due from subsidiaries 8 Share of loss from investments in associates TOTAL EXPENSES INCOME BEFORE INTEREST EXPENSES AND CORPORATE INCOME TAX INTEREST EXPENSES CORPORATE INCOME TAX INCOME (LOSS) AFTER CORPORATE INCOME TAX NET INCOME ATTRIBUTABLE TO MINORITY INTEREST NET INCOME (LOSS) FOR THE YEAR EARNINGS PER SHARE Basic earnings per share Net income (loss) Diluted earnings per share Net income (loss)

4,330,726,394

5,275,067,954

9,181,501

-

360,000 146,639,265

181,210,721

89,520,000 23,633,068

71,600,000 40,257,193

57,980,096 97,241,150 302,220,511 4,632,946,905

31,323,370 247,644,762 112,800,763 572,979,616 5,848,047,570

1,867,982,103 12,703,863 1,993,839,034 2,003,020,535

14,807,609 51,999,636 21,487,053 200,151,491 200,151,491

2,559,058,131 726,463,583 -

3,137,799,048 779,101,853 265,009,455 -

8,498,397 78,070,210 529,510,946

83,884,434 -

644,669,911 3,930,191,625

390,582,511 4,572,492,867

616,079,553

20,693,993 104,578,427

702,755,280 (363,830,264) (316,980,521) 21,944,495 (63,370,604) (41,426,109)

1,275,554,703 (444,044,010) (394,240,777) 437,269,916 (201,091,300) 236,178,616

1,386,940,982 (89,730,031) 1,297,210,951 1,297,210,951

95,573,064 (126,783,384) (31,210,320) (31,210,320)

(0.005)

0.028

0.164

(0.004)

(0.005)

0.027

0.158

(0.004)

28

The accompanying notes are an integral part of the financial statements.

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

69


70 A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

JASMINE INTERNATIONAL PUBLIC COMPANY LIMITED AND ITS SUBSIDIARIES

STATEMENTS OF CHANGES IN SHAREHOLDERS没 EQUITY FOR THE YEARS ENDED 31 DECEMBER 2007 AND 2006 (Unit: Baht)

Balance as at 31 December 2005 Unrealised items in income statements Currency translation differences Increase (decrease) in capital surplus from share premium of subsidiary Decrease in fair value of investments Increase in ordinary shares Decrease in warrants - net Increase in discount on ordinary shares Net income for the year Transfered to statutory reserve Minority interest increase in share capital of subsidiary Minority interest newly acquired subsidiaries Net income from sales of equipment of subsidiaries attributable to minority interest Sales of investments in subsidiary (Note 13.8) Net income attributed to minority interest in subsidiaries Dividend paid to minority interest in subsidiaries Balance as at 31 December 2006

Issued and fully paid-up share capital 8,319,877,163

Discount on Warrants ordinary shares 26,074,779 (1,757,679,587)

Consolidated financial statements Unrealised gain on Capital changes in value Currency surplus from of investments in translation share premium available-for-sale differences of subsidiary securities (2,612,913) 62,045,303

Minority interest equity attributable to minority Statutory shareholders reserve Unappropriated of subsidiaries 270,034,238 1,184,042,516 385,133,513 Retained earnings

Total 8,486,915,012

-

-

-

2,612,913

-

-

-

-

-

2,612,913

30,000 -

(300) -

(19,680) -

-

51,799,272 -

(60,146,303) -

27,479,299 -

236,178,616 (27,479,299) -

(51,799,272) (7,729,748) 532,311,778 11,824,273

(67,876,051) 30,000 (300) (19,680) 236,178,616 532,311,778 11,824,273

26,074,479 (1,757,699,267)

-

51,799,272

1,899,000

297,513,537

45,255,706 (1,446,058) - 201,091,300 - (39,707,784) 1,392,741,833 1,074,933,708

45,255,706 (1,446,058) 201,091,300 (39,707,784) 9,407,169,725

8,319,907,163

The accompanying notes are an integral part of the financial statements.


JASMINE INTERNATIONAL PUBLIC COMPANY LIMITED AND ITS SUBSIDIARIES

STATEMENTS OF CHANGES IN SHAREHOLDERS没 EQUITY (Continued) FOR THE YEARS ENDED 31 DECEMBER 2007 AND 2006 (Unit: Baht)

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

Balance as at 31 December 2006 Unrealised items in income statements Increase (decrease) in capital surplus from share premium of subsidiary Increase in fair value of investments Net loss for the year Dividend paid to the Company没s shareholders (Note 29) Transferred to statutory reserve Treasury shares for the year Transferred to treasury shares reserve Minority interest increase in share capital of subsidiary Minority interest newly acquired subsidiary (Note 13.2) Net income from sales of equipment of subsidiaries attributable to minority interest Net income attributed to minority interest in subsidiaries Dividend paid to minority interest in subsidiaries Balance as at 31 December 2007

Consolidated financial statements Unrealised Minority gain on Retained earnings interest equity Capital changes in value attributable surplus from of investments in to minority Discount on share premium available-for-sale Statutory shareholders ordinary shares of subsidiary securities reserve Unappropriated Treasury shares of subsidiaries

Issued and fully paid-up share capital

Warrants

8,319,907,163

26,074,479 (1,757,699,267)

8,319,907,163

The accompanying notes are an integral part of the financial statements.

Total

51,799,272

1,899,000

297,513,537

1,392,741,833

-

(1,078,695) -

569,700 -

62,545,619 -

(41,426,109) (123,527,423) (62,545,619) (300,745,624) -

(300,745,624) 300,745,624 -

1,078,695 1,681,820 (162,502,091)

569,700 (41,426,109) (123,527,423) (300,745,624) 1,681,820 (162,502,091)

26,074,479 (1,757,699,267)

50,720,577

2,468,700

360,059,156

864,497,058

-

40,736,226 63,370,604 (48,146,026) 971,152,936

40,736,226 63,370,604 (48,146,026) 8,837,180,802

-

- 1,074,933,708

9,407,169,725

71


72 A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

JASMINE INTERNATIONAL PUBLIC COMPANY LIMITED AND ITS SUBSIDIARIES

STATEMENTS OF CHANGES IN SHAREHOLDERS没 EQUITY (Continued) FOR THE YEARS ENDED 31 DECEMBER 2007 AND 2006 (Unit: Baht)

Balance as at 31 December 2005 - as previously reported Cumulative effect of the change in accounting policy for investments in subsidiaries and associates (Note 4) Balance as at 31 December 2005 - as restated Unrealised item in income statements Decrease in fair value of investments Increase in ordinary shares Decrease in warrants - net Increase in discount on ordinary shares Net loss for the year (restated) Transferred to statutory reserve Balance as at 31 December 2006 - as restated Balance as at 31 December 2006 - as previously reported Cumulative effect of the change in accounting policy for investments in subsidiaries and associates (Note 4) Balance as at 31 December 2006 - as restated Net income for the year Dividend paid to the Company没s shareholders (Note 29) Treasury shares for the year Transferred to treasury shares reserve Balance as at 31 December 2007

Separate financial statements Unrealised gain on Capital changes in value Currency surplus from of investments in translation share premium available-for-sale difference of subsidiary securities (2,612,913) 62,045,303

Retained earnings

Issued and fully paid-up share capital 8,319,877,163

Discount on Warrants ordinary shares 26,074,779 (1,757,679,587)

8,319,877,163

26,074,779 (1,757,679,587)

2,612,913 -

-

(26,380,345) 35,664,958

- (2,657,984,730) 71,267,295 (1,275,175,271)

- (2,681,752,162) - 5,420,029,337

30,000 8,319,907,163

(300) (19,680) 26,074,479 (1,757,699,267)

-

-

(35,664,958) -

(31,210,320) 11,808,931 (11,808,931) 83,076,226 (1,318,194,522)

-

(35,664,958) 30,000 (300) (19,680) (31,210,320) 5,353,164,079

8,319,907,163

26,074,479 (1,757,699,267)

-

51,799,272

1,899,000

83,076,226

-

8,332,236,017

8,319,907,163 8,319,907,163

26,074,479 (1,757,699,267) 26,074,479 (1,757,699,267)

-

(51,799,272) -

(1,899,000) -

The accompanying notes are an integral part of the financial statements.

Statutory reserve Unappropriated Treasury shares 71,267,295 1,382,809,459 -

1,607,179,144

- (2,925,373,666) 83,076,226 (1,318,194,522) - 1,297,210,951 - (123,527,423) - (300,745,624) 83,076,226 (445,256,618)

Total 8,101,781,499

- (2,979,071,938) - 5,353,164,079 - 1,297,210,951 - (123,527,423) (300,745,624) (300,745,624) 300,745,624 - 6,226,101,983


JASMINE INTERNATIONAL PUBLIC COMPANY LIMITED AND ITS SUBSIDIARIES

CASH FLOW STATEMENTS FOR THE YEARS ENDED 31 DECEMBER 2007 AND 2006

Consolidated financial statements 2007

2006

(Unit: Baht) Separate financial statements 2007

2006 (Restated)

Cash flows from operating activities Net income (loss) Adjustments to reconcile net income (loss) to net cash provided by (paid from) operating activities Depreciation and amortisation Amortisation of deferred interest under installment contracts Loss on impairment of assets Write off assets Loss on sales of leasehold rights Loss (gain) on sales of property, plant and equipment Allowance for doutful accounts Revenues from reversal of liabilities Dividend income from investments in subsidiaries Gain on sales of investments in subsidiary Share of loss from investments in associates Unrealised exchange gain Realised exchange gain from long-term liabilities Net income from sales of equipment of subsidiaries attributable to minority interest Net income attributable to minority interest Income (loss) from operating activities before changes in operating assets and liabilities Operating assets decrease (increase) Trade accounts receivable Amounts due from related parties Inventories Prepaid project costs Unbilled receivable Other current assets Other non-current assets Operating liabilities increase (decrease) Trade accounts payable Amounts due to related parties Advances received Corporate income tax payable Accrued project costs Accrued expenses Other current liabilities Other non-current liabilities Net cash flows from operating activities

(41,426,109)

236,178,616

1,297,210,951

(31,210,320)

796,662,569

862,334,960

15,525,639

15,408,787

55,849,071 14,405,193 2,341,404 (205,809) 644,669,911 (34,548,074) (14,620,521)

28,239,150 6,228,094 124,527 1,529,376 (59,335,816) (197,425) 390,582,511 (19,117,920) (305,345,079)

529,510,946 (35,074) (1,867,982,103) -

(48,020) 20,693,993 (51,999,636) (64,530) -

40,736,226 63,370,604

45,255,706 201,091,300

-

-

1,527,234,465

1,387,568,000

(25,769,641)

(47,219,726)

143,338,309 (8,603,705) (15,358,400) (182,450) (23,764,734) 75,871,762 1,017,413

(231,997,337) 81,471 36,907,573 (39,365,608) 124,953,746 (29,262,430) 4,018,398

144,162,180 11,352,488 6,891,433 6,638,188 56,843,116 (6,000)

(68,232,113) 316,876,397 (7,479,938) 171,702,997 (39,550,441) 659,305

358,751,447 (52,438,415) (10,377,969) (67,248,073) (1,098,583) (3,977,001) (36,361,312) 6,474,716 1,893,277,470

(17,377,021) 58,685,928 (111,449,099) (42,366) 97,151,645 (44,147,458) (122,613,469) 4,737,378 1,117,849,351

(1,607,357) 5,304,495 (1,581,969) (2,206,492) (2,972,071) (21,497,132) 517,650 176,068,888

(63,738,357) (807,256) (17,170,300) (23,691,383) (231,152) (8,498,344) (1,014,752) 211,604,937

The accompanying notes are an integral part of the financial statements. A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

73


JASMINE INTERNATIONAL PUBLIC COMPANY LIMITED AND ITS SUBSIDIARIES

CASH FLOW STATEMENTS (Continued) FOR THE YEARS ENDED 31 DECEMBER 2007 AND 2006

Consolidated financial statements 2007

2006

(Unit: Baht) Separate financial statements 2007

2006 (Restated)

Cash flows from investing activities Decrease (increase) in current investments Decrease (increase) in restricted deposits with financial institutions Dividend received from investments in subsidiaries Net cash received from investment in subsidiary (Note 13.6) Cash paid from investments in subsidiaries and associate (Note 13.2, 13.7) Proceeds from sales of investments in subsidiary Proceeds from sales of property, plant and equipment Proceeds from sales of leasehold rights Acquisition of property, plant and equipment Increase in deferred project costs Net cash flows from (used in) investing activities Cash flows from financing activities Decrease in bank overdrafts and short-term loans from banks Repayment for accounts and notes payable for equipment Cash received from long-term borrowings from bank Repayment of long-term loans borrowings from banks Repayment of long-term debts under rehabilitation plan Dividend paid to the Company没s shareholders Dividend paid to minority interest in subsidiaries Cash received from increase in share capital of subsidiary Cash received from warrant exercise Cash paid for treasury shares Net cash flows used in financing activities Currency translation differences Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year Supplemental cash flows information Cash paid during the year for Interest expenses Corporate income tax Non-cash transaction Purchases of equipment by liabilities

107,212,956

(324,725,212)

(3,711,496)

21,215,746

(46,268,470) -

829,385,481 38,103,939

(27,356) 467,987,208 -

(5,326,207) 233,757,196 -

(180,442,699) 1,970,569 (436,319,745) (553,847,389)

(324,895,187) 3,825,000 5,527,802 3,300,000 (132,897,920) (52,500) 97,571,403

78,147 (3,930,381) 460,396,122

1,250,000 54,205 (2,495,455) 248,455,485

(63,026,518) (270,571,944) (860,368,000) (830,494,826) (123,527,423) (48,146,026) 1,681,820 (300,745,624) (2,495,198,541) (1,155,768,460) 4,573,804,808 3,418,036,348 -

(1,661,761) 3,430,000,000 (3,848,188,197) (535,911,790) (43,735,104) 532,311,778 10,020 (467,175,054) 2,612,913 750,858,613 3,822,946,195 4,573,804,808 -

(830,494,826) (123,527,423) (300,745,624) (1,254,767,873) (618,302,863) 977,388,121 359,085,258 -

(535,911,791) 10,020 (535,901,771) (75,841,349) 1,053,229,470 977,388,121 -

339,305,036 405,363,387

492,467,669 447,244,452

113,880,709 7,159,489

155,834,485 32,087,064

-

995,263,872

-

-

The accompanying notes are an integral part of the financial statements.

74

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JASMINE INTERNATIONAL PUBLIC COMPANY LIMITED AND ITS SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED 31 DECEMBER 2007 AND 2006

1. CORPORATE INFORMATION Jasmine International Public Company Limited (çThe Companyé) is a public company incorporated and domiciled in Thailand. The Company is principally engaged in investments in companies involved in the telecommunication business and its registered address is 200, 29th - 30th Floor, Moo 4, Chaengwatana Road, Pakkred, Nonthaburi.

2. BASIS OF PREPARATION 2.1 The financial statements have been prepared in accordance with accounting standards enunciated under the Accounting Profession Act B.E. 2547. The presentation of the financial statements has been made in compliance with the stipulations of the Notification of the Department of Business Development dated 14 September 2001, issued under the Accounting Act B.E. 2543. The financial statements have been prepared on a historical cost basis except where otherwise disclosed in the accounting policies. 2.2 Basis of consolidation a) The consolidated financial statements include the financial statements of the Company and the following subsidiaries.

Companyûs name

Held by the Company Jasmine Submarine Telecommunications Co., Ltd. Acumen Co., Ltd. Jasmine Telecom Systems PCL. (2007: Another 9% held by T.J.P. Engineering Co., Ltd.) Jasmine Internet Co., Ltd. T.J.P. Engineering Co., Ltd. (Another 20% held by Acumen Co., Ltd.) Jasmine International Overseas Co., Ltd. (Another 34% held by ACeS (Thailand) Co., Ltd. and another 26% held by ACeS Regional Services Co., Ltd.) Chaengwatana Planner Co., Ltd. Jasmine Cyber Works Co., Ltd. Jasmine Smart Shop Co., Ltd. Mobile Communication Services Co., Ltd. Compunet Corporation Limited Jasmine Energy Co., Ltd. Jasmine Cable & Materials Co., Ltd.

Nature of business

Country of incorporation

Percentage of shareholding by the Company 2007 2006 Percent Percent

Assets as a percentage to the consolidated total assets as at 31 December 2007 2006 Percent Percent

Revenues as a percentage to the consolidated total revenues for the year ended 31 December 2007 2006 Percent Percent

Operator of submarine optical fibre cable network Satellite telecommunications services Design, installation and testing of telecommunication systems

Thailand

100

100

17

18

21

22

Thailand

100

100

9

10

4

16

Thailand

57

57

15

14

16

27

Internet service provider Survey, design and construction of telecommunications Investment holding

Thailand Thailand

65 80

65 80

1 2

1 2

9 2

7 1

Thailand

40

40

-

-

-

-

Rehabilitation plan administrator Ceased operation Ceased operation Ceased operation

Thailand Thailand Thailand Thailand

100 100 100 70

100 100 100 70

1

1

-

-

Ceased operation In the process of dissolution In the process of dissolution

Thailand Thailand Thailand

100 90 100

100 90 100

1 -

1 -

1 -

-

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Company没s name

Held by subsidiaries Siam Teltech Computer Co., Ltd. (98% held by Jasmine Telecom Systems PCL.) Smart Highway Co., Ltd. (67% held by Acumen Co., Ltd.) Triple T Broadband PCL. (91% held by Acumen Co., Ltd.) Triple T Internet Co., Ltd. (2007: 100% held by Triple T Broadband PCL.) ACeS (Thailand) Co., Ltd. (2007: 59% held by Jasmine International Overseas Co., Ltd., 2006: 18% held by Jasmine International Overseas Co., Ltd., 31% held by Acumen Co., Ltd. and 10% held by Jasmine Submarine Telecommunications Co., Ltd.) ACeS Regional Services Co., Ltd. (98% held by ACeS (Thailand) Co., Ltd.) Pakkret Planner Co., Ltd. (100% held by Jasmine International Overseas Co., Ltd.) Clippership Investments (BVI) Limited (100% held by Jasmine International Overseas Co., Ltd.) Thai Long Distance Telecommunications Co., Ltd. (90% held by Jasmine Submarine Telecommunications Co., Ltd.) JasTel Network Co., Ltd. (100% held by Jasmine Submarine Telecommunications Co., Ltd.) Premium Assets Co., Ltd. (54% held by Acumen Co., Ltd. and 46% held by Jasmine Submarine Telecommunications Co., Ltd.)

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A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

Nature of business

Country of incorporation

Percentage of shareholding by the Company 2007 2006 Percent Percent

Assets as a percentage to the consolidated total assets as at 31 December 2007 2006 Percent Percent

Revenues as a percentage to the consolidated total revenues for the year ended 31 December 2007 2006 Percent Percent

Provision, design and software Thailand development

-

-

4

3

3

7

Domestic high speed data communication rental service provider Service provider in telecommunications network Not yet start operation

Thailand

-

-

-

-

1

1

Thailand

-

-

12

11

27

5

Thailand

-

-

-

-

-

-

Investment holding

Thailand

-

-

-

1

-

-

Marketing and distribution of equipment and providing services to satellite-based cellular phone users Rehabilitation plan administrator

Thailand

-

-

3

2

4

5

Thailand

-

-

-

-

-

-

British Virgin Island

-

-

-

-

-

-

Operator of submarine optical fibre cable network

Thailand

-

-

5

4

7

7

Domestic and Oversea high speed data communication rental service provider

Thailand

-

-

2

-

2

-

Office rental

Thailand

-

-

9

7

3

2

Ceased operation


b) Material balances and transactions between the Company and its subsidiaries have been eliminated from the consolidated financial statements. c) Investments in the subsidiaries as recorded in the CompanyĂťs books of account are eliminated against the equity of the subsidiaries. The resultant differences are amortised over a period of 8-18 years commencing as from the date of acquisition of the investments. d) The consolidated financial statements did not include the financial statements of two subsidiaries, Jasmine Energy Co., Ltd., and Jasmine Cable & Materials Co., Ltd., since the subsidiaries are now in the process of dissolution. 2.3 The separate financial statements, which present investments in subsidiaries and associates under the cost method, have been prepared solely for the benefit of the public.

3. ADOPTION OF NEW ACCOUNTING STANDARDS The Federation of Accounting Professions (FAP) has issued Notifications No. 9/2550, 38/2550 and 62/2550 regarding Accounting Standards. The notifications mandate the use of the following new Accounting Standards. a) Accounting Standards which are effective for the current year TAS 44 (revised 2007) Consolidated Financial Statements and Separate Financial Statements TAS 45 (revised 2007) Investments in Associates TAS 46 (revised 2007) Interests in Joint Ventures These accounting standards become effective for the financial statements for fiscal years beginning on or after 1 January 2007. During the current year, the Company changed its accounting policy for recording investments in subsidiaries and associates in the separate financial statements in order to comply with the revised Thai Accounting Standards No. 44 and 45 as described in Note 4 to the financial statements. b) Accounting Standards which are not effective for the current year TAS 25 (revised 2007) Cash Flow Statements TAS 29 (revised 2007) Leases TAS 31 (revised 2007) Inventories TAS 33 (revised 2007) Borrowing Costs TAS 35 (revised 2007) Presentation of Financial Statements TAS 39 (revised 2007) Accounting Policies, Changes in Accounting Estimates and Errors TAS 41 (revised 2007) Interim Financial Reporting TAS 43 (revised 2007) Business Combinations TAS 49 (revised 2007) Construction Contracts TAS 51 Intangible Assets These accounting standards will become effective for the financial statements for fiscal years beginning on or after 1 January 2008. The management has assessed the effect of these revised accounting standards and believes that they will not have any significant impact on the financial statements for the year in which they are initially applied, except for the following accounting standard. TAS 43 (revised 2007) çBusiness CombinationsÊ TAS 43 (revised 2007) does not require the Company to amortise goodwill acquired in a business combination. Such goodwill is instead to be tested for impairment, and measured at cost less accumulated impairment A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

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losses. This accounting standard applies to goodwill arising from business combinations for which the agreement date is on or after 1 January 2008. Previously recognised goodwill can be accounted for prospectively, with the Company discontinuing the amotisation of the goodwill and instead testing for impairment, as from the beginning of the first fiscal year starting on or after 1 January 2008.

4. CHANGE IN ACCOUNTING POLICY FOR RECORDING INVESTMENTS IN SUBSIDIARIES, AND ASSOCIATES IN THE SEPARATE FINANCIAL STATEMENTS During the current year, the Company changed its accounting policy for recording investments in subsidiaries and associates in the separate financial statements from the equity method to the cost method, in compliance with Accounting Standard No. 44 (Revised 2007) regarding çConsolidated Financial Statements and Separate Financial Statementsé, under which investments in subsidiaries, jointly controlled entities and associates are to be presented in the separate financial statements under the cost method. In this regard, the Company has restated the previous yearûs separate financial statements as though the investments in the subsidiaries and associates had originally been recorded using the cost method. The change has the effect of increasing net income in the separate income statements for the year ended 31 December 2007 and 2006 by Baht 1,339 million (Baht 0.169 per share) and decreasing by Baht 267 million (Baht 0.032 per share), respectively. The cumulative effect of the change in accounting policy has been presented under the heading of çCumulative effect of the change in accounting policy for investments in subsidiaries and associatesé in the separate statements of changes in shareholdersû equity. Such change in accounting policy affects only the accounts related to investments in subsidiaries and associates in the Companyûs separate financial statements, with no effect to the consolidated financial statements.

5. SIGNIFICANT ACCOUNTING POLICIES 5.1 Revenue Recognition Sales of goods are recognised when the significant risks and rewards of ownership of the goods have passed to the buyer. Sales are the invoiced value, excluding value added tax, of goods supplied after deducting discounts and allowances. Revenues from services related to providing telecom network services, internet services and other business related to the internet business, telephone business, and management services are recognised when services have been rendered. Revenues from design and installation of telecommunication systems are recognised when services have been rendered taking into account the stage of completion. Revenues from public telephone rental are recognised based on rental period, at the rate stipulated in the rental contract. Interest income is recognised as interest accrues based on the effective rate method. Dividends are recognised when the right to receive the dividends is established. 5.2 Cash and cash equivalents Cash and cash equivalents consist of cash in hand, cash at banks, and all highly liquid investments with an original maturity of three months or less and not subject to withdrawal restrictions. 5.3 Trade accounts receivable Trade accounts receivable are stated at the net realisable value. Allowance for doubtful accounts is provided for the estimated losses that may be incurred in collection of receivables. The allowance is generally based on collection experiences and analysis of debtor aging. 78

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited


5.4 Inventories Inventories are valued at the lower of average cost (specific cost for computer equipment products) and net realisable value. 5.5 Investments a) Investments in available-for-sale securities are stated at fair value. Changes in the carrying amounts of securities are recorded as separate items in shareholders没 equity until the securities are sold, when the changes are then included in determining income. b) Investments in non-marketable equity securities, which the Company and its subsidiaries classify as other investments, are stated at cost net of allowance for loss on diminution in value. c) Investments in dissolved subsidiaries are stated at cost net of allowance for loss on diminution in value. d) Investments in associates are accounted for in the consolidated financial statements using the equity method. e) Investments in subsidiaries and associates are accounted for in the separate financial statements using the cost method net of allowance for loss on diminution in value. The fair value of marketable securities is based on the latest bid price of the last working day of the year as quoted on the Stock Exchange of Thailand. The weighted average method is used for computation of the cost of investments. In the event the Company and its subsidiaries reclassify investments in securities, such investments are adjusted to their fair value as at the reclassification date. Differences between the carrying amount of the investments and their fair value on that date are included in determining income or recorded as surplus (deficit) from change in the value of investments in shareholders没 equity, depending on the type of investment which is reclassified. 5.6 Property, plant and equipment/Depreciation Property is stated at cost. Buildings and equipment are stated at cost less accumulated depreciation and allowance for loss on impairment of assets. Depreciation of plant and equipment is calculated by reference to their costs on the straight-line basis over the following estimated useful lives: Buildings - 20, 24 years Building improvements - 9 - 12 years Leasehold improvements - 5 years Satellite transmission equipment - 5 years Public telephones - 10 years but not more than the remaining terms of their rental contracts Furniture, fixtures and office equipment - 3, 5, 10 years Motor vehicles - 5 years Equipment for network service provider - 5 - 15 years Depreciation is included in determining income. No depreciation is provided on land and assets under installation. 5.7 Leasehold rights and amortisation Leasehold rights are stated at cost less accumulated amortisation. Amortisation is calculated by reference to its cost on a straight-line basis over the lease period of 30 years. The amortisation is included in determining income.

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5.8 Deferred project costs and amortisation Deferred project costs are stated at cost less accumulated amortisation and allowance for loss on impairment of assets. Amortisation is calculated by reference to their costs as follows:

(a) Costs of the submarine optical fiber cable projects are amortised over the concession periods and calculated by reference to the proportion of the number of circuits available for service in each year against the total number of circuits available throughout the contract periods. (b) Costs of equipment for domestic high-speed data communication rental service are amortised on a straight-line basis over the concession periods. The amortisation is included in determining income. 5.9 Assets held for sale Assets held for sale are valued at the lower of cost and net realisable value. 5.10 Related party transactions Related parties comprise enterprises and individuals that control, or are controlled by, the Company, whether directly or indirectly, or which are under common control with the Company. They also include associates and individuals which directly or indirectly own a voting interest in the Company that gives them significant influence over the Company, key management personnel, directors and officers with authority in the planning and direction of the Company没s operations. 5.11 Long-term installment agreements A subsidiary records long-term installment agreements for equipment which transfer substantially all the risks and rewards of ownership to the subsidiary as capital expenditures at the present value of the installment payment. The outstanding obligations less the financial expense are recorded as long-term debt, while the interest element is charged to the income statements over the period of the installment agreements. 5.12 Foreign currencies Foreign currency transactions are translated into Baht at the exchange rates ruling on the transaction dates. Assets and liabilities denominated in foreign currencies outstanding at the balance sheet date are translated into Baht at the exchange rates ruling on the balance sheet date, with the exception of those covered by forward exchange contracts, which are translated at the contracted rates. Gains and losses on exchange are included in determining income. 5.13 Impairment of assets The Company and its subsidiaries assess at each reporting date whether there is an indication that an asset may be impaired. If any such indication exists, the Company and its subsidiaries make an estimate of the asset没s recoverable amount. Where the carrying amount of the asset exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. Impairment losses are recognised in the income statement. An asset没s recoverable amount is the higher of fair value less costs to sell and value in use. 5.14 Employee benefits Salaries, wages, bonuses and contributions to the social security fund and provident fund are recognised as expenses when incurred. 5.15 Provisions Provisions are recognised when the Company and its subsidiaries have a present obligation as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. 80

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited


5.16 Treasury shares Treasury shares are stated at cost and presented as a deduction from shareholders没 equity. Gains on disposal of treasury shares are determined by reference to the carrying amount and are presented as premium on treasury shares. Losses on disposal of treasury shares are determined by reference to the carrying amount and are presented in premium on treasury shares and retained earnings, consecutively. 5.17 Income tax Income tax is provided for in the accounts based on the taxable profits determined in accordance with tax legislation. 5.18 Derivatives Forward exchange contracts Receivables and payables arising from forward exchange contracts are translated into Baht at the rates of exchange ruling on the balance sheet. Gains and losses from the translation are included in determining income. Premiums or discounts on forward exchange contracts are amortised on a straight-line basis over the contract periods. 5.19 Use of accounting estimates Preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions in certain circumstances, affecting amounts reported in these financial statements and related notes. Actual results could differ from these estimates.

6. REHABILITATION PLANS 6.1 The Business Rehabilitation Plan of the Company The Central Bankruptcy Court approved the business rehabilitation plan of the Company on 7 August 2003 and appointed Chaengwatana Planner Co., Ltd. as the plan administrator. Subsequently on 14 September 2006, the Court issued an order terminating the business rehabilitation of the Company. However, certain creditors of the Company lodged objections to some issues with the Supreme Court, and the issues are being considered by Supreme Court. The Company believes that these issues will not have any impact on the financial statements of the Company. 6.2 The Business Rehabilitation Plan of Jasmine International Overseas Co., Ltd., a subsidiary The Central Bankruptcy Court approved the subsidiary没s business rehabilitation plan on 30 September 2003 and appointed Pakkret Planner Co., Ltd. as plan administrator. Subsequently on 26 July 2007, the Court issued an order terminating the business rehabilitation of the subsidiary. The Company and the subsidiary recorded the accounting transactions for the debt restructuring under the rehabilitation plan in 2003 and have presented the outstanding debts after restructuring under the caption of 莽Long-term debts under rehabilitation plan茅, as described in Note 8 and 24 to the financial statements.

7. CURRENT INVESTMENTS - DEPOSITS WITH FINANCIAL INSTITUTIONS Included in the balances of current investments as at 31 December 2007 are savings deposits and fixed deposits of the Company and its subsidiaries amounting to approximately Baht 36 million (2006: Baht 47 million) and of the Company only amounting to approximately Baht 25 million (2006: Baht 21 million) which have been pledged with the financial institutions to secure credit facilities.

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8. RELATED PARTY TRANSACTIONS During the years, the Company and its subsidiaries had significant business transactions with related parties, which have been concluded on commercial terms and bases agreed upon in the ordinary course of business between the Company and those companies. Below is a summary of those transactions. (Unit: Million Baht) Consolidated financial statements Transactions with associated companies Sales and service income Rental and other service income Other income Cost of sales and services Management fee expenses Purchase of equipment Sale promotion expenses Transactions with related companies Sales and service income Rental and other service income

2007

2006

1,399

1,303

9

1

14

3

511 108 80 2

181 32 25

2

2

21

17

Transfer Pricing Policy

Contract price or normal business price charged to other customers or bidding price Contract price or normal business price charged to other customers Contract price or normal business price charged to other customers Contract price Contract price As agreed upon As agreed upon

Contract price or normal business price charged to other customers Contract price or normal business price charged to other customers

(Unit: Million Baht) Separate financial statements

82

2007

2006

Transactions with subsidiary companies (eliminate from the consolidated financial statements) Management fee income Rental and other service income

89 34

72 31

Other income Management fee expenses Interest expenses Other expenses

1 7 23

10 1 5 25

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

Transfer Pricing Policy

Contract price Contract price or normal business price as charged to other customers Contract price Contract price MLR-2 Contract price


The balances of the accounts as at 31 December 2007 and 2006 between the Company and those related companies are as follows: Consolidated financial statements

Trade accounts receivable - related parties Associated companies TT&T PCL. TT&T Subscriber Services Co., Ltd. Related companies Mono Generation Co., Ltd. Others Total trade accounts receivable - related parties Short-term loans to and amounts due from related parties Short-term loans to subsidiary companies Compunet Corporation Limited Jasmine Smart Shop Co., Ltd. Total short-term loans to subsidiary companies Amounts due from related parties Subsidiary companies Jasmine Submarine Telecommunications Co., Ltd. Thai Long Distance Telecommunications Co., Ltd. Jasmine Internet Co., Ltd. Acumen Co., Ltd. Jasmine International Overseas Co., Ltd. Premium Assets Co., Ltd. Triple T Broadband PCL. Siam Teltech Computer Co., Ltd. Jasmine Smart Shop Co., Ltd. Jasmine Cyber Works Co., Ltd. Associated companies TT&T PCL. Premium Real Estate Co., Ltd. Total amounts due from related parties Total short-term loans to and amounts due from related parties Less: Allowance for doubtful accounts Total short-term loans to and amounts due from related parties

(Unit: Million Baht) Separate financial statements

2007

2006

2007

2006

468 486 954

399 314 713

-

-

14 14 968

3 1 4 717

-

-

-

-

39 6 45

6 6

-

-

198 43 10 4 2 1 2 6 9 275

237 43 10 8 10 1 6 9 324

10 10 10 -

1 1 1 -

275 320 (21)

1 325 331 (21)

10

1

299

310

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In 2006, the Company recorded allowance for doubtful accounts for short-term loan to and amounts due from related parties, Jasmine Smart Shop Co., Ltd. and Jasmine Cyber Works Co., Ltd., totaling Baht 21 million.

Consolidated financial statements

Unbilled receivable - related party Associated company TT&T PCL. Total unbilled receivable related party Dividend receivable from subsidiary company Acumen Co., Ltd. Total dividend receivable from subsidiary company Advance payments for investment projects to related parties Associated companies Palang Thai Kaowna Co., Ltd. Khunka Palang Thai Co., Ltd. Related company Palit Palangngan Co., Ltd. Total advance payments for investment projects Less: Allowance for doubtful accounts Total advance payments for investment projects to related parties - net

(Unit: Million Baht) Separate financial statements

2007

2006

2007

2006

150

177

-

-

150

177

-

-

-

-

1,400 1,400

-

107 20 127

107 20 127

107 20 127

107 20 127

16 143 (109)

16 143 (109)

16 143 (109)

16 143 (109)

34

34

34

34

Advance payments for investments projects are advance payments to purchase of land for IPP (Independent Power Producer) projects which have now been aborted. (Unit: Million Baht) Consolidated financial statements

Trade accounts payable - related parties Subsidiary company Jasmine Telecom Systems PCL. Associated companies TT&T PCL. TT&T Subscriber Services Co., Ltd. Total trade accounts payable - related parties

84

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

Separate financial statements

2007

2006

2007

2006

-

-

16

16

567 4 571 571

217 37 254 254

16

16


Consolidated financial statements Amounts due to related parties Subsidiary companies Mobile Communication Services Co., Ltd. Acumen Co., Ltd. Jasmine Submarine Telecommunications Co., Ltd. Others Associated companies TT&T PCL. Premium Real Estate Co., Ltd. Total amounts due to related parties Advance received from related party Associated company TT&T PCL. Total advance received from related party Long - term debts under rehabilitation plan from related parties Subsidiary companies Acumen Co., Ltd. Jasmine Submarine Telecommunications Co., Ltd. Total Less: Current portion (Deferred interest expenses portion) Total long - term debts under rehabilitation plan from related parties - net of current portion

(Unit: Million Baht) Separate financial statements

2007

2006

2007

2006

-

-

4 8 4 1 17

6 3 1 1 11

20 4 24 24

72 4 76 76

17

11

-

12 12

-

-

-

-

555 269 824

555 269 824

-

-

(118)

(94)

-

-

706

730

Long-term debts under rehabilitation plan with related companies are debts under the rehabilitation plan of the Company. Principal is to be settled in full in 2013, while interest is to be paid quarterly, at a rate of MLR-2 per annum, although the Company has the right to carry the interest forward to pay it in 2013. If the Company does not have sufficient surplus cash in 2013 to settle the principal and interest, all outstanding debts and interest are to be forgiven. In 2007, movements of short-term loans to and long-term debts under rehabilitation plan from related parties were as follows: (Unit: Million Baht) Balance as at 31 December 2006 Short-term loans to related parties Subsidiary companies Compunet Corporation Limited Jasmine Smart Shop Co., Ltd.

6 6

Separate financial statements During the period Increase Decrease

39 39

-

Balance as at 31 December 2007

39 6 45 A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

85


(Unit: Million Baht) Balance as at 31 December 2006 Long-term debts under rehabilitation plan from related parties Subsidiary companies Acumen Co., Ltd. Jasmine Submarine Telecommunications Co., Ltd.

555 269 824

Separate financial statements During the period Increase Decrease

-

-

Balance as at 31 December 2007

555 269 824

Directors and management没s remuneration In 2007, the Company and its subsidiaries paid salaries, meeting allowances and gratuities to their directors and management totaling Baht 118 million and the Company only totaling Baht 18 million (2006: Baht 107 million and Baht 16 million, respectively). Guarantee obligations with subsidiaries The Company has outstanding guarantee obligations with its related subsidiaries, as described in Note 33.2 to the financial statements.

9. TRADE ACCOUNTS RECEIVABLE The outstanding balances of trade accounts receivable as at 31 December 2007 and 2006 are aged, based on due date, as follows: Consolidated financial statements Age of receivables Related parties Not yet due Past due Up to 3 months Longer than 3 - 6 months Longer than 6 - 12 months Longer than 12 months Total Less: Allowance for doubtful accounts Net Unrelated parties Not yet due Past due Up to 3 months Longer than 3 - 6 months Longer than 6 - 12 months Longer than 12 months Total Less: Allowance for doubtful accounts Net Trade accounts receivable - net

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(Unit: Million Baht) Separate financial statements

2007

2006

2007

2006

355

312

-

-

386 67 117 43 968 968

389 9 7 717 717

-

-

327

370

-

-

414 70 29 126 966 (84) 882 1,850

764 116 37 92 1,379 (87) 1,292 2,009

14 56 70 (56) 14 14

158 60 218 (60) 158 158


Included in trade accounts receivable from unrelated parties over the age thresholds of 3 months as at 31 December 2007 and 2006, are amounts receivable from companies majority-owned by the government as follows: (Unit: Million Baht) Separate financial statements

Consolidated financial statements Age of receivables Longer than 3 - 6 months Longer than 6 - 12 months Longer than 12 months Total

2007

2006

2007

2006

55 22 47 124

110 19 6 135

14 14

-

Subsidiaries have assigned their rights over collection of major trade accounts receivable to banks, to secure credit facilities obtained from those banks. As at 31 December 2007, subsidiaries had outstanding balances of overdue trade accounts receivable from TT&T Public Company Limited (TT&T) and TT&T Subscriber Services Co., Ltd. (TT&T SS), which are an associate and a subsidiary of the associate, respectively, totaling Baht 599 million. Subsequent to the balance sheet date, the subsidiaries received payment of Baht 146 million of this debt, and the management of the subsidiaries have assessed the ability of TT&T and TT&T SS to service debt and the current financial status of TT&T, which is in the process of restructuring its debts and they are confident that they will be able to make full collection of the outstanding balances.

10. INVENTORIES (Unit: Million Baht) Consolidated financial statements

Satellite transmission equipment Finished goods and spare parts Total inventories Less: Allowance for obsolete inventories Inventories - net

2007

2006

29 161 190 (110) 80

67 143 210 (115) 95

11. RESTRICTED DEPOSITS WITH FINANCIAL INSTITUTIONS These represent saving and fixed deposits which the Company and its subsidiaries pledged to secure credit facilities.

12. INVESTMENTS IN DISSOLVED SUBSIDIARIES (Unit: Million Baht) Consolidated financial statements / Separate financial statements Paid-up capital Jasmine Energy Co., Ltd. Jasmine Cable & Materials Co., Ltd. Less: Allowance for diminution in value of investments Total investments in dissolved subsidiaries - net

2007 110 6

Cost 2006 110 6

2007 103 6 109 (58) 51

2006 103 6 109 (58) 51 A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

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13. INVESTMENTS IN SUBSIDIARIES (Unit: Million Baht) Separate financial statements Paid-up capital

Investments in subsidiaries Jasmine Submarine Telecommunications Co., Ltd. Acumen Co., Ltd. T.J.P. Engineering Co., Ltd. Mobile Communication Services Co., Ltd. Jasmine Telecom Systems PCL. Compunet Corporation Limited Jasmine Smart Shop Co., Ltd. Jasmine Cyber Works Co., Ltd. Jasmine International Overseas Co., Ltd. Jasmine Internet Co., Ltd. Chaengwatana Planner Co., Ltd. Less: Allowance for diminution in value of investments Total investments in subsidiaries - net

Cost

2007

2006

2007

2006

1,550 760 200 100 702 260 110 52 115 15 0.1

1,550 760 200 100 701 260 110 52 115 15 0.1

1,946 760 160 70 100 100 110 52 46 1 3,345 (351) 2,994

1,946 760 160 70 100 100 110 52 46 1 3,345 (351) 2,994

Dividend received for the year ended 31 December 2007 2006 1,800 68 1,868

52 52

13.1 The majority of the share certificates of the investments of the Company and Jasmine Telecom Systems PCL., a subsidiary, have been pledged or delivered to a security agent as collateral to secure long-term debts under the rehabilitation plan, as described in Note 24 to the financial statements. 13.2 During the current year, T.J.P. Engineering Co., Ltd., a subsidiary, purchased 60 million shares in Jasmine Telecom Systems PCL. from an unrelated party for a total of Baht 180 million. As a result, the group companies没 combined shareholdings in the aforementioned company changed from 57% to 66%. 13.3 On 4 May 2007, Jasmine Telecom Systems PCL. (JTS), a subsidiary, issued 1,000,000 ordinary shares, at a price of Baht 1 per share, or a total of Baht 1,000,000 in accordance with its employee share ownership plan (ESOP). JTS registered the increase in its paid-up capital to Baht 702,000,000 with the Ministry of Commerce on 9 May 2007. During the year 2006, JTS sold an additional 175 million ordinary shares with a par value of Baht 1 each through an initial public offering at a price of Baht 3.2 per share. JTS received a total of Baht 531 million from sales of these additional ordinary shares, net of direct expenses. JTS listed these shares on the Stock Exchange of Thailand with the first trading date being on 18 September 2006. On 9 March 2005, a meeting of the Extraordinary General Meeting of Shareholders of JTS, passed a resolution approving an Employee Securities Plan (ESOP) for the directors and employees of JTS whereby it would

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issue and offer not more than 5,000,000 ordinary ESOP shares of 1 Baht per share and not more than 21,250,000 ESOP warrants free of charge. One warrant can be exercised to purchase one ordinary share and the warrants are registered and non-transferable. The term of the warrants does not exceed five years from the date on which they are granted and the exercise price is set at between 1 to 2 Baht per share, depend on JTSûs net profit for the fiscal year. The ESOP warrants have restrictions on the exercise period and number of warrants that can be exercised, and these are dependent on the position of the selected employees. The warrants are not listed on the Stock Exchange of Thailand. This was approved by the Securities and Exchange Commission on 31 October 2006. On 25 October 2006, a meeting of the Board of Directors of JTS passed a resolution approving the issuance and offering of 1,000,000 ordinary ESOP Shares (from a total of 5,000,000 ordinary ESOP shares) and 21,250,000 ESOP warrants to its directors and employees on 3 November 2006. The remaining shares (4,000,000 ESOP shares) are to be offered within 5 years from the first offer date. On 3 November 2006, JTSûs directors and employees exercised their rights to purchase 1,000,000 ordinary shares, as discussed above. JTS registered the increase of its paid-up capital to Baht 701 million with the Ministry of Commerce on 7 November 2006. The public offering and exercise of rights to purchase ordinary shares by JTSûs directors and employees resulted in decrease in the Companyûs shareholding in JTS from 76% to 57%. The Company has recognised the net increase in the value of JTS of Baht 52 million under the caption of çCapital surplus from share premium of subsidiaryé in shareholderûs equity. 13.4 On 29 August 2007, the Extraordinary General Meeting of Shareholders No. 4/2550 of Triple T Broadband Co., Ltd. (TTT), a subsidiary, passed a resolution approving the transmuting of TTT from a company limited to a public company limited, and additional resolutions approving the following: 1. A change in the par value of its shares from Baht 10 per share to Baht 1 per share. 2. An increase in TTTûs registered share capital from Baht 110 million to Baht 1,200 million through the issuance of 1,090 million new ordinary shares with a par value of Baht 1 per share to be allocated by private placement. TTT registered the change in par value and the increase of share capital with Ministry of Commerce on 4 September 2007. During the current year, TOT Public Company Limited (çTOTé) lodged complaint against TTT at numerous police stations, alleging that TTT had illicitly used TOTûs interconnection points. However TTTûs management believes that TTTûs use of TOTûs interconnection points was not in any way illicit since it comprised use of equipment or services in accordance with a contract with a related company. The issue has not yet been finalized, but TTTûs management believes that TTT will not suffer any significant loss as a result of the complaint. 13.5 On 22 August 2007, a meeting of Board of Directors of Jasmine International Overseas Co., Ltd., a subsidiary, passed a resolution to purchase 80 million shares in ACeS (Thailand) Co., Ltd., a subsidiary, from Jasmine Submarine Telecommunications Co., Ltd., and Acumen Co., Ltd., which are also subsidiaries. As a result, the shareholding of Jasmine International Overseas Co., Ltd. in ACeS (Thailand) Co., Ltd. changed from 18% to 59%. The purpose of the acquisition and disposal of the shares was to restructure shareholding within the group of companies.

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13.6 During the year 2006, a meeting of the Board of Directors of Acumen Co., Ltd. (ACUMEN), a subsidiary, passed a resolution approving ACUMEN, which formerly held one share of Triple T Broadband Co., Ltd. (TTT) to purchase additional ordinary shares of TTT (1 existing share: 10 new shares) totaling 10 shares at a par value of 10 Baht per share and to subscribe to the 9,999,930 TTT shares which TT&T waived its right to acquire, at a par value of Baht 10 per share. As a result, the ACUMEN没s shareholding in TTT increased from 0.0001% to 91%. The book value of the net assets of TTT on the purchase date was Baht 130 million. Negative goodwill recognised from the acquisition of these ordinary shares in TTT of Baht 18 million is recognised as income over the useful life of non-monetary assets. The book value of the assets and liabilities of TTT on the purchase date were as follows: Cash and cash equivalents Other current assets Equipment - net Other current liabilities Total net assets Less: Minority interest Net assets received Less: Negative goodwill on acquisition Cash payment for investment Less: Cash and cash equivalent Net cash received from investment

(Unit: Million Baht) 138 164 259 (431) 130 (12) 118 (18) 100 (138) 38

In addition, on 13 September 2006, ACUMEN and TT&T have entered into the agreement of undertaking prescribing that ACUMEN shall provide financial support to TTT during the time when TTT is a subsidiary and ACUMEN will allow the shareholders of TT&T to purchase the newly issued shares and/or the existing shares of TTT held by ACUMEN in order to adjust the shareholding proportion in TT&T on the date of the initial public offering of TTT or the date 3 year没s period after the date of execution the agreement. In this regard, if a public offering of TTT shares is made, the purchase price of such shares shall be par value (Baht 10) plus a premium at the rate of 20% per year or the public offering price of the ordinary shares of TTT, whichever is lower. If the public offering does not occur, the purchase price shall be a fair price as assessed by an independent financial advisor approved by the Securities and Exchange Commission. 13.7 During the year 2006, Jasmine Submarine Telecommunications Co., Ltd., a subsidiary, purchased 110.4 million shares in TT&T through the Stock Exchange of Thailand for a total of Baht 325 million. As a result, the group companies没 combined shareholdings in TT&T changed from 27% to 30%. 13.8 During the year 2006, meetings of the Boards of Directors of the Company and Acumen Co., Ltd., a subsidiary, passed resolutions approving the disposal of their investments in 61,199 ordinary shares of Baht 62.50 each of NTU (Thailand) Co., Ltd., a total of Baht 3.8 million to an unrelated party. The Company and the subsidiary recorded gains on the sale of these investments totaling Baht 0.2 million.

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14. INVESTMENTS IN ASSOCIATES (Unit: Million Baht) Consolidated financial statements Country of incorporation

Nature of businesses

TT&T PCL. Internet Knowledge Service Center Co., Ltd. Premium Real Estate Co., Ltd. Palang Thai Kaowna Co., Ltd. Khunka Palang Thai Co., Ltd. Telecom KSC Co., Ltd. Total investments in associates

Fixed line services provider Communication equipment rental Ceased operations Not yet operations Not yet operations Not yet operations

Shareholding percentage

Carrying amounts based on equity method

Cost

2007

2006

2007

2006

2007

2006

Thailand Thailand

(%) 30 38

(%) 30 38

7,186 49

7,186 49

2,923 10

3,560 16

Thailand Thailand Thailand Thailand

49 23 23 40

49 23 23 40

402 7,637

402 7,637

2,933

3,576

(Unit: Million Baht) Separate financial statements Nature of businesses

TT&T PCL. Internet Knowledge Service Center Co., Ltd. Premium Real Estate Co., Ltd. Palang Thai Kaowna Co., Ltd. Khunka Palang Thai Co., Ltd. Telecom KSC Co., Ltd. Total investments in associates

Fixed line services provider Communication equipment rental Ceased operations Not yet operations Not yet operations Not yet operations

Country of incorporation

Shareholding percentage

Provision for impairment Carrying amounts based of investments on cost - net

Cost

2006 (%) 25

2007

2006

Thailand

2007 (%) 25

2007

2006

6,103

6,103 (3,499) (2,969)

2,604

3,134

Thailand

38

38

49

(32)

17

17

Thailand Thailand Thailand Thailand

49 23 23 40

49 23 23 40

402 6,554

402 (402) (402) 6,554 (3,933) (3,403)

2,621

3,151

49

2007

(32)

2006

14.1 Summarised financial information of associates (Unit: Million Baht)

Company没s name

TT&T PCL. Internet Knowledge Service Center Co., Ltd. Premium Real Estate Co., Ltd. Palang Thai Kaowna Co., Ltd. Khunka Palang Thai Co., Ltd. Telecom KSC Co., Ltd.

Paid-up capital as at 31 December

Total assets as at 31 December

Total liabilities as at 31 December

2007

2007

2007

32,425 50 820 1 1 1

2006

2006

2006

32,425 32,178 34,472 20,483 20,737 50 151 146 123 124 820 28 40 6 8 1 40 40 456 456 1 37 37 93 93 1 -

Total revenues for the year ended 31 December

Net income (loss) for the year ended 31 December

2007

2006

2007

2006

5,516 7 -

7,017 (2,041) (1,030) 7 5 (17) 10 (10) (1) -

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14.2 The Company recognised share of losses from investments in two associates, as listed below, until the value of the investments reached zero. Subsequent losses incurred by those associates have not been recognised in the Company没s accounts since the Company has no obligations, whether legal or constructive, to make any payments on behalf of those associates. As at 31 December 2007, the amount of such unrecognised share of losses is set out below.

Palang Thai Kaowna Co., Ltd. Khunka Palang Thai Co., Ltd. Total

(Unit: Million Baht) Cumulative share of losses, which unrecognised as at 31 December 2007 96 13 109

14.3 The share of losses for the year ended 31 December 2007 of two associates, namely, Internet Knowledge Service Center Co., Ltd. and Telecom KSC Co., Ltd., were included in these financial statements. These accounts were prepared by their managements and have not been audited by their auditors. 14.4 As at 31 December 2007, the investments of the Company and its subsidiaries in TT&T PCL., an associates, have total book values of Baht 2,923 million, of which Baht 2,604 million is attributable to the Company and have total market values of Baht 871 million, of which Baht 729 million is attributable to the Company. No allowance for the difference in value has been set aside against the investments since the management believes that present value of the benefits to be derived from these investments in the future exceeds the above carrying value. 14.5 The significant matters disclosed in financial statements of TT&T PCL. (TT&T), an associate, for the year ended 31 December 2007, are summarised as follows: 14.5.1 Income from Telephone Service Expansion and Joint Investment Agreement for the year ended 31 December 2007 and 2006 has continued to decline while telecommunication network service income and sales and services income are growing and sufficiently compensate the decline of core revenues. Notwithstanding the surging of total revenues, the increase of cost of goods sold, and operating expenses have caused TT&T and its subsidiaries to incur operating losses of Baht 2,028 million (2006: Baht 1,079 million), while TT&T incurred operating loss of Baht 2,041 million (2006: Baht 1,029 million) for the year ended 31 December 2007. As at 31 December 2007, TT&T had current liabilities exceeded its current assets by Baht 3,643 million (2006: Baht 1,387 million). TT&T and its subsidiaries had current liabilities exceeded their current assets by Baht 3,792 million (2006: Baht 1,344 million). Total outstanding amount of TT&T没s long term loan was Baht 18,789 million of which Baht 1,915 million was the principal amount due on 30 June 2007 and 31 December 2007, while continuing to pay interest at the normal rate in full amount. TT&T is currently negotiating with its creditors regarding the principal repayment schedule and default interest of Baht 20.71 million and USD 0.25 million (approximately Baht 8.36 million). The management of TT&T anticipates that agreement with the creditors can be reached within 2008. TT&T is still implementing cash flow monitoring procedures in accordance with the loan agreements, under which TT&T is responsible for presenting 92

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operating budgets to the Instructing Group for approval. The management believes that the going concern basis on which the financial statements is prepared, is appropriate since TT&T will be successful in maintaining its main income, which is derived from fixed-line telephone services and value added services, especially in data communications and internet services, as a result of a specific focus on marketing and various strategies for increasing subscribers and an attempt to reduce operating costs as well as undergoing financial restructuring. Nevertheless, the situation is uncertain and may affect the success of TT&Tûs future operations and its ability to generate sufficient cash flows from operations to meet the conditions of the loan agreements. The ultimate outcome of this matter cannot presently be determined. The financial statements reflect managementûs current assessments of the impact to date of the situation on the financial position of TT&T. Actual results could differ from the managementûs current assessments and such differences could be material. 14.5.2 TT&T earns income from other value added services, e.g. T-Pin (Postpaid) service, T-Card (Prepaid) service, ADSL, and Free phone 1800 service, etc., for which the rates of revenue sharing and/or an agreement are being considered by TOT PCL. (TOT). However, TT&T has recorded the income sharing at the same rates applied to the value added services or at the rate initially agreed with TOT. 14.5.3 TT&T had the following outstanding certain disputes with TOT. a) Change in status of the TOT TT&T filed a lawsuit against TOT requesting the Central Administrative Court to order TOT to act in compliance with the Joint Undertaking Agreement Clause 37, stating that çIn case of any change in the status of the TOT, all powers and authorities held by the TOT, including the power to stipulate the maintenance standards, shall not be transferred to any private agency to the extent that the private agency would have the power to supervise and control TT&T. In such event, all of the powers and authorities held by TOT shall be vested in the Ministry of Transporté. The Central Administrative Court judged that TT&T won the case. At present, TOT has made an appeal against the decision and the case is being considered by the Supreme Administrative Court. b) Reimbursement from TOT for introducing and/or allowing other parties to introduce çValue added services under the Joint Operate and Joint Investment Agreementé onto TT&Tûs fixed-line network. TT&T submitted an arbitration claim with the Thai Arbitration Institute, the Alternative Dispute Resolution Office, and the Office of the Judiciary, in order to claim compensation from TOT for introducing and/or allowing other parties to introduce value-added services onto the TT&Tûs fixed-line network, in accordance with the Joint Operate and Joint Investment Agreement between TOT and TT&T. TT&Tûs claims as of 31 March 2005 total Baht 28,096 million, together interest at a rate of MLR+1% on the aforementioned amount until payment is made in full. TT&Tûs claim also requests payment from TOT for the access charge, from 1 April 2005 until the expiry date of the Joint Operate and Joint Investment Agreement. The Arbitrator has been appointed and the disputes set out, and the disputes are currently being considered. A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

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c) The reduction of tariff for domestic long-distance telephone service TT&T submitted a claim of Baht 746 million to the Thai Arbitrator Institute requesting TOT pay compensation for its reduction of domestic long-distance fees and reduction of revenue sharing from international calls from CAT. Subsequently, TOT filed a defense and a counterclaim with the Thai Arbitration Institute and requested that the Institute dismiss the claim and order TT&T to pay for revenue losses incurred from 1 July 2004 to 31 May 2005 amounting to Baht 460 million together interest and the revenue to be derived from 1 June 2005 onwards. The Arbitrator has been appointed and the disputes set out, and the disputes are currently being considered. d) Logo on public payphone booth TOT submitted the case to the Thai Arbitration Institute demanding that TT&T affixes the TOT logo on public telephones and telephone booths, as well as compensates for all damages resulted from affixing TT&T logo on the payphones and booths, commencing from October 1997 to September 2005, totaling Baht 382 million, plus related interest of 7.5% per annum until full payment is made. The Executive Department of TT&T does not expect these issues to have any significant impacts on its financial statements. TT&T therefore, has not made any provision for those claims in its financial statements. In addition TT&T already had filed a defense and a counterclaim to the Thai Arbitration Institute. Subsequently, TOT filed defense of TT&T没s counterclaim. Currently, the Arbitrators are appointing. e) Equipment transfer TOT sent a letter to TT&T, requesting of compensation for loss of benefit and the cost of damages caused by non-transfer of equipment for additional extension of the network of 122 telephone exchanges and non-transfer of the SDH equipment totaling Baht 162 million and Baht 3,263 million respectively. Since the Management of TT&T believed that after the transfer of property ownership, TT&T has a sole right to use, to occupy and to maintain as well as the sole right to seek interests in the property. TT&T has the duty to give all received revenues to TOT and in turn TOT shall allot to TT&T such revenues it receives. In the past, both companies had fully performed the aforementioned duties. The Management of TT&T believes that, on the basis of details provided, the claim made by TOT regarding this matter is unjustified and can be defended accordingly and no provision has been made in respect of this claim in its financial statements. f) Building of DLC System TOT submitted an arbitration claim with the Thai Arbitration Institute, the Alternative Dispute Resolution Office, and the Office of the Judiciary, in order to claim TT&T for the building of DLC System and TT&T没s non-authorised use of telephone numbering in the Samutsakhorn Industrial Estate without the approval of TOT. TOT has claimed for damages of Baht 39.8 million covering the period from April 2003 to December 2005. The Management of TT&T considers that the Joint Operate Agreement has acted fully under its rights, so there is no damage to be claimed by TOT. Therefore, no provision has been made with respect to this claim in its financial statements in this fiscal year and TT&T filed a defense against such claim to the Thai Arbitration Institute. Currently, the Arbitrations are appointing. 94

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g) T-Pin, T-SMS, ADSL and T-Card services. TOT submitted to the arbitrator the matter of TT&T没s provision of services to T-Pin, T-SMS, ADSL services during the early stage of operations as well as additional revenue sharing of T-Card and T-Card. TT&T, as a protester, prepared and proposed an objection statement on this matter to the Thai Arbitration Institute. Currently, the Arbitrations are appointing. h) Revenues from long-distance telephone service at economic rate During the first quarter of 2006, TT&T received correspondence from TOT regarding the Y-Tel 1234 service income. TT&T and TOT are in the process of providing clarification or finding a conclusion for the said matters. i) Allegation and complaint filing from TOT TT&T received a notice from the National Telecommunications Commission (NTC) stating that TOT filed complaints against TT&T at the police stations. TOT accused TT&T of providing its network equipment that was transferred to TOT for procuring benefits without permission. The management of TT&T believe that TT&T operated its business correctly based upon its right stipulated under the Concession Agreement as well as the related Addendums and there was no guilty occurred. TT&T informed the factual information as well as submitted related documents and evidences to the NTC.

j)

Payment of revenue sharing TOT submitted a petition to the Thai Arbitration Institute for it to order TT&T to repay excess amount of the revenue sharing which TT&T has received from TOT in accordance with the concession agreement, amounting to Baht 700 million, plus interest. The management of TT&T believes that the claims amount shall be the excise tax which TT&T deducted from revenue sharing from TOT and submitted to the Excise Department in compliance with the 2003 Cabinet没s resolution. TT&T as the respondent, submitted a petition to the Thai Arbitration Institute asking for an extension of the term for submission of a response and the Thai Arbitration Institute has allowed TT&T until 14 March 2008 to submit such response.

15. INVESTMENT IN OTHER COMPANIES

Other investments ACeS International Limited Others Less: Allowance for diminution in value of investments Total other investments

Paid-up capital Million USD

Consolidated financial statements 2007/2006 Shareholding percentage Percent

305

9

Investments Million Baht 868 26 894 (894) -

A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

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96 A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

16. PROPERTY, PLANT AND EQUIPMENT (Unit: Thousand Baht) Consolidated financial statements

Land

Buildings, leasehold improvement and building improvement

ACeS gateway station for the ACeS Satellite - based mobile project

Cost As at 31 December 2006 325,133 1,440,340 774,096 Additions 63,886 Disposals (6,411) Transfers in (out) 10,323 As at 31 December 2007 325,133 1,508,138 774,096 Accumulated depreciation As at 31 December 2006 271,541 149,963 Depreciation for the year 73,411 Depreciation on disposals (6,408) Transfers in (out) As at 31 December 2007 338,544 149,963 Allowance for impairment of assets As at 31 December 2006 10,725 624,133 Increase during the year As at 31 December 2007 10,725 624,133 Net book value As at 31 December 2006 325,133 1,158,074 As at 31 December 2007 325,133 1,158,869 Depreciation for the year 2006 (Baht 433 million included in service cost, and the balance in selling, servicing and administrative expenses) 2007 (Baht 398 million included in service cost, and the balance in selling, servicing and administrative expenses)

Equipment for network service provider

Public telephones

Satellite transmission equipment

Furniture, fixtures and office equipment

Assets under installation

Others

Total

660,086 (4,200) 10,373 666,259

670,003 97,516 594,545 1,362,064

333,486 15,095 (26,528) 85,863 407,916

205,445 58,298 (31,039) 7,718 240,422

249,775 31,381 (1,303) 279,853

723,799 170,144 (36) (655,993) 237,914

5,382,163 436,320 (69,517) 52,829 5,801,795

249,352 90,600 (2,532) 337,420

26,169 171,578 45,118 242,865

222,146 35,779 (25,614) 16,825 249,136

155,197 24,360 (30,770) 148,787

197,964 26,665 (1,302) 223,327

-

1,272,332 422,393 (66,626) 61,943 1,690,042

-

-

6,226 17,721 23,947

365 365

-

-

641,449 17,721 659,170

410,734 328,839

643,834 1,119,199

105,114 134,833

49,883 91,270

51,811 56,526

723,799 237,914

3,468,382 3,452,583 468,630 422,393


(Unit: Thousand Baht) Separate financial statements Tools, machinery and equipment Motor vehicles

Leasehold improvement

Furniture, fixtures and office equipment

Cost As at 31 December 2006 Additions Disposals As at 31 December 2007

31,027 70 31,097

16,847 1,987 (2,106) 16,728

2,073 2,073

2,737 2,737

1,873 1,873

52,684 3,930 (2,106) 54,508

Accumulated depreciation As at 31 December 2006 Depreciation for the year Depreciation on disposals As at 31 December 2007

30,952 30 30,982

13,703 1,636 (2,063) 13,276

2,073 2,073

2,563 40 2,603

-

49,291 1,706 (2,063) 48,934

Net book value As at 31 December 2006 As at 31 December 2007

75 115

3,144 3,452

-

174 134

1,873

3,393 5,574

Depreciation for the year 2006 (included in selling, servicing and administrative expenses) 2007 (included in selling, servicing and administrative expenses)

Assets under installation

Total

1,576 1,706

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As at 31 December 2007, certain plant and equipment items of the Company and its subsidiaries had been fully depreciated but were still in use. The original cost of those assets amounted to approximately Baht 478 million of which Baht 46 million is from the Company (2006: Baht 317 million and Baht 46 million, respectively). In November 2005, Premium Assets Co., Ltd., a subsidiary, purchased Jasmine International Tower from financial institutions at a price of Baht 1,200 million. The Company has leasehold rights to space in this building, as described in Note 17 to the financial statements, and therefore presents these leasehold rights as part of the building purchased by the subsidiary in the consolidated financial statements, in order that the presentation of information reflects its underlying economic substance. The Baht 624 million costs of construction of an ACeS gateway station for the satellite-based mobile project of ACeS Regional Services Co., Ltd., a subsidiary. Construction was completed and commercial services were launched in February 2001. Because of uncertainties as to the success of the ACeS Satellite base mobile project, during 2002 the subsidiary set up an allowance for loss on impairment of the ACeS gateway station amounting to Baht 336 million in the accounts and has set up a full allowance in the year 2003. As at 31 December 2007, Public telephones of Jasmine Telecom System PCL. (JTS) had a total net book value of Baht 329 million (2006: Baht 411 million) represent costs of equipment and expenses incurred in the installation of the public telephones, which have been rented to TOT PCL. (TOT) for a period of 10 years under three contracts. Under these contracts, JTS is obliged to supply and install a total of 30,000 public telephones (10,000 public telephones under each contract) within 3 years of the contract date. The first contract is dated 31 January 2001 and will expire on 30 January 2011, and the second and the third contracts are dated 15 January 2004 and will expire on 14 January 2014. As at 31 December 2007, JTS had been able to install only 11,934 telephones (8,641 under the first contract, 1,855 under the second, and 1,438 under the third). However, since TOT was unable to allocate all of the numbers for the telephones to be installed under the three contracts to JTS, TOT has agreed in its letters dated 29 April 2004, 19 May 2006 and 22 May 2006, to extend the installation period until all telephone numbers have been allocated. In the meantime, JTS and TOT have been collaborating to resolve this issue. According to the contracts, JTS will receive monthly rental at a fixed monthly rate per telephone for the first service year and thereafter at the rate of 50 percent of the average revenue earned by each telephone during the previous year. The majority of equipment for use in providing network services had been acquired under long-term installment agreements as described in Note 22 to the financial statements. Title to and ownership of the equipment will pass to a subsidiary when the subsidiary has made full payment of the contract price. In addition, as at 31 December 2007 the telecommunications equipment of approximately Baht 496 million has been pledged to secure the accounts payable for equipment.

17. LEASEHOLD RIGHTS In July 1998, the Company entered into a 30-year agreement to lease space in an office building (Jasmine International Tower) from an associate and paid advance rental of Baht 415 million. Subsequently, in 2000 the associate transferred ownership of the building to financial institutions in settlement of liabilities, in accordance with a debt restructuring agreement. In November 2005, Premium Assets Co., Ltd, a subsidiary, acquired the building back from the financial institution (Note 16). As a result, in order to present information in accordance with its underlying economic substance, the Company has presented its leasehold rights as part of the building purchased by the subsidiary in the consolidated financial statements. 98

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The leasehold rights balances as at 31 December 2007 and 2006 are as follows: (Unit: Million Baht) Separate financial statements Leasehold rights Less: Accumulated amortisation Leasehold rights - net Amortisation for the year

2007 415 (130) 285

2006 415 (116) 299

14

14

18. ASSETS HELD FOR SALE (Unit: Million Baht) Consolidated financial statements Land Building - net Total

2007 48 6 54

2006 48 6 54

In order to assess the fair values of the above assets held for sale, during the year 2004, a subsidiary arranged to have such assets revalued by an independent appraiser. According to this revaluation, the fair values of these assets exceed their carrying value. As at the balance sheet date, the management of the subsidiary believes that the fair values of the above assets held for sale does not differ from the values appraised during the year 2004.

19. DEFERRED PROJECT COSTS (Unit: Million Baht) Consolidated financial statements Costs of submarine optical fibre cable project Cost of communication equipment - net Cost of equipment for domestic high - speed data communication rental service Total Less: Accumulated amortisation Deferred project cost - net Amortisation for the year

2007 5,123 253

2006 5,123 253

3 5,379 (4,054) 1,325

3 5,379 (3,704) 1,675

350

369

The costs of the submarine optical fiber cable network project represent costs incurred under the joint investment contract between Jasmine Submarine Telecommunications Co., Ltd. (JSTC), and Thai Long Distance Telecommunications Co., Ltd. (TLDT), which are subsidiaries, with TOT PCL. (TOT) to install a submarine optical fiber cable networks on the east and the west coasts of Thailand, dated 4 October 1991. Ownership of the network was immediately transferred to TOT upon the subsidiary没s completing network installation and its passing the final acceptance test conducted by TOT. In return JSTC and TLDT are entitled to a share of revenues earned from the network over a period of 20 years, as from the date the network was transferred. JSTC and TLDT transferred its A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

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rights over the collection of its share of the revenues from TOT, under the above joint investment contract, to secure long-term loan of JSTC, as described in Note 23.1 to the financial statements. JSTC and TLDT have an obligation to comply with certain conditions as stated in the agreement. The costs of communications equipment used to provide satellite communication services under the agreement between Compunet Corporation Limited (CPN), a subsidiary, and the National Telecommunications Commission (NTC) (formerly known as The Posts and Telegraph Department). Ownership of the communications equipment is transferred to NTC upon its utilisation in the provision of service. In return CPN is entitled to operate the domestic satellite communications service for a period of 22 years, as from the date service commences, CPN has an obligation to comply with certain conditions as stated in the agreement. The costs of equipment for domestic high-speed data communication rental service represents the cost of computer and communications equipment used to provide services under the agreement between Smart Highway Co., Ltd. (SMH), a subsidiary, and CAT Telecom PCL. (CAT) dated 15 January 1999. Ownership of the communications equipment was transferred to CAT when SMH delivered the equipment in accordance with the agreement. In return SMH is entitled to operate the service under such contract for a period of 10 years, SMH has an obligation to comply with certain conditions as stated in the agreement.

20. EXCESS OF COST OF INVESTMENTS OVER NET ASSETS VALUE OF SUBSIDIARIES (Unit: Million Baht) Consolidated financial statements Cost 31 December 2006 Investment during the year 31 December 2007 Amortisation 31 December 2006 Amortisation 31 December 2007 Net 31 December 2006 31 December 2007

157 17 174 61 24 85 96 89

21. BANK OVERDRAFTS AND SHORT-TERM LOANS FROM FINANCIAL INSTITUTIONS Bank overdrafts and short-term loans from financial institutions as at 31 December 2007 and 2006 consist of: Interest rate

Bank overdrafts Short-term loans from financial institutions Total bank overdrafts and short-term loans from financial institutions

(percent per annum) MOR to MOR+1 MLR

(Unit: Million Baht) Consolidated financial statements 2007 1 323 324

2006 15 372 387

Bank overdrafts of a subsidiary totaling Baht 1 million (2006: Baht 1 million) are secured by the Company. Short-term loans from financial institutions of subsidiaries are secured by the assignment of their rights over collection of trade accounts receivable of the subsidiaries as described in Note 9 to the financial statements. 100

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22. ACCOUNTS AND NOTES PAYABLE FOR EQUIPMENT In 2006, Jasmine Telecom Systems PCL. (JTS), a subsidiary, purchased equipment from two groups of companies: domestic and overseas. Under the sales and purchase agreements, JTS is obliged to make payment within 3 years. The outstanding balances of such transactions as at 31 December 2007, based on due dates, are as follow: (Unit: Million Baht) Consolidated financial statements Accounts and notes payable for equipment Less: Deferred interest expenses Total Less: Current portion Accounts and notes payable for equipment - net of current portion

2007 681 (41) 640 (311) 329

2006 1,014 (52) 962 (299) 663

The above outstanding balance of accounts and notes payable for equipment is secured by deposits with a financial institution, the pledge of equipment for providing network telecommunications services as described in Note 16 to the financial statements and the assignment of rights over collection from a related company, in accordance with the conditions stipulated in the agreements with accounts payable for equipment as described in Note 33.8 to the financial statements.

23. LONG-TERM LOANS (Unit: Million Baht) Consolidated financial statements 23.1 Baht 3,400 million loan with interest rate of MLR, repayable quarterly from June 2006 to September 2010 and secured by a) all rights and benefits pertaining to concession agreements as described in Note 19 to the financial statements b) deposit of JSTC c) letter of guarantee from TLDT 23.2 Baht 80 million loan with interest rate of MLR, repayable monthly from July 2005 to June 2008 and secured by assigned rights over collection of trade accounts receivable 23.3 Baht 30 million loan with interest rate of MLR, repayable monthly from January 2007 to December 2009 and secured by assigned rights over collection of trade accounts receivable Total Less: Current portion Long-term loans - net of current portion

2007

2006

2,095

2,856

-

69

2,095 (762) 1,333

30 2,955 (812) 2,143

In 2006, Jasmine Submarine Telecommunications Co., Ltd. (JSTC), a subsidiary, drew down a Baht 3,400 million (Note 23.1) under a credit facilities agreement with a local commercial bank in order to make payment of the outstanding principal, accrued interest and other liabilities under the USD 180 million senior secured notes. JSTC therefore recognised the penalty of Baht 265 million for early redemption of the senior secured notes in the consolidated income statement. A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

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However, JSTC has been unable to maintain the Debt Service Coverage Ratio (DSCR) as stipulated in the agreement, which is to be not less than 1.25. As at 30 June 2007, the ratio is 1.23 as a result of this event, the lender may give notice to JSTC requiring it to remedy its breach to the lender没s satisfaction within 60 days from the date the borrower learns of such event. Currently, JSTC granted a waiver by the lender. In 2007, Jasmine Telecom Systems PCL., a subsidiary, made early repayment of the outstanding amounts of long-term loans (Note 23.2 and 23.3) with no penalty. The periods to maturity of long-term loans as at 31 December 2007 and 2006 are as follows: (Unit: Million Baht) Consolidated financial statements Within one year After one year but within three years Total

2007 762 1,333 2,095

2006 812 2,143 2,955

24. LONG-TERM DEBTS UNDER REHABILITATION PLAN (Unit: Million Baht) Consolidated financial statements / Separate financial statements Long-term debts under rehabilitation plan (Note 6), repayable under rehabilitation program and consisting of the following loans. 24.1 Baht 1,827 million loan at interest rate of MLR, repayable within 9 years. 24.2 Baht 171 million loan, repayable within 9 years with interest rate of MLR-2% for the first eight years and MLR+20% for the ninth year. 24.3 Baht 818 million loan at interest rate of MLR, repayable within 4 years. Total Less: Current portion Long-term debts under rehabilitation plan - net of current portion

2007

2006

912

1,347

161 19 1,092 (28) 1,064

163 412 1,922 (567) 1,355

In March 2007, the Company made early repayment of long-term debts under rehabilitation plan amounting to Baht 396 million, comprising the installments due to creditors under the Company没s rehabilitation plan (Note 24.1) for the period 9 June 2007 to 9 December 2010. The periods to maturity of long-term debts under rehabilitation plan as at 31 December 2007 and 2006 are as follows: (Unit: Million Baht) Consolidated financial statements / Separate financial statements Within one year After one year but within five years After five years Total

102

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2007 28 929 135 1,092

2006 567 45 1,310 1,922


Under the rehabilitation plan of the Company, the majority of the investments of the Company and Jasmine Telecom Systems PCL., a subsidiary, had to be pledged or delivered to the custody of a security agent.

25. WARRANTS 25.1 Warrants offered to existing shareholders In July 1999, the Company issued 333.6 million warrants for existing shareholders to subscribe for ordinary shares at Baht 0.10 each. The warrants, which were issued in the ratio of 1 warrant per 1 existing ordinary share, have an exercise period of 10 years (the Annual General Meeting No. 1/2545 passed a resolution approving the extension of the maturity of the warrants from 5 years to 10 years), and are exercisable every 3 months. The first and the last exercise dates are 15 September 1999 and 15 June 2009, respectively. One warrant provides the right to purchase one ordinary share (with a par value of Baht 10 each) at the exercise price of Baht 5. On 25 September 2003, Meeting No. 12/2546 of the Plan Administrator Board passed a resolution approving the issue 551.97 million warrants (Warrant II) for existing shareholders to subscribe to ordinary shares at Baht 0.05 each. The warrants, which were issued in a ratio of 1 warrant per 1 existing ordinary share, have an exercise period of 5 years from the date of issue, and are exercisable every 3 months. One warrant provides the right to purchase one ordinary share (with a par value of Baht 10 each) at an exercise price of Baht 5. In addition, the same meeting passed a resolution approving an adjustment of the rights of the existing warrants and warrants as described in Note 25.2 to the financial statements. The adjustment of the rights of the existing warrants will be determined according to the calculation formula and method provided in the prospectus for these warrants. In October 2003, the Company issued additional 106.65 million warrants (with the same exercise price and exercise ratio as the existing warrants) in order to comply with the criteria for adjusting the exercise price and ratio stipulated in the prospectus for these warrants, since the issuance of Warrant II and the offer of 30 million shares to specific investors under the rehabilitation plan have resulted in loss of rights and benefits for the holders of the original warrants. In conjunction with the Company没s stock split, whereby the par value of the shares changed from Baht 10 to Baht 1 per share, the number and exercise price of the warrants was adjusted. For Warrants I the exercise price was changed from Baht 3.341 per share to Baht 0.334 per share, the exercise ratio remained at 1 warrant per 1 ordinary share and the warrant holders are to receive an additional 9 warrants for every 1 warrant held, effective 8 January 2004. For Warrants II the exercise price was changed from Baht 5 per share to Baht 0.5 per share, with the exercise ratio remaining at 1 warrant per 1 ordinary share and the warrant holders to receive an additional 9 warrants for every 1 warrant held, totaling 10 warrants as from the date the Company issued the warrants (9 February 2004). In 2007, there were no warrants exercised to purchase new ordinary shares. As at 31 December 2007, 6,191,591,050 warrants remained unexercised. 25.2 Warrants offered to the directors and/or employees of the Company and its subsidiaries (ESOP) On 4 September 2000, the Extraordinary General Meeting of Shareholders No. 1/2543 passed a resolution approving the issue and offering of 18.4 million registered, non-transferable warrants to purchase common shares to directors and/or employees of the Company and its subsidiaries, free of charge. The warrants have an exercise period of 5-8 years (the Extraordinary General Meeting of shareholders No. 1/2545 passed a resolution approving the extension of the maturity of the warrants from 5 years to 5-8 years) from the date of issue, and are exercisable every 3 months. One warrant will provide the right to purchase one ordinary share (with a par value of Baht 10 each) at exercise prices of between Baht 10 and Baht 29.28. A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

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In 2001, the Company issued the first 5.46 million warrants to purchase ordinary shares, for free of charge, and in 2002 issued the second 13.49 million warrants to purchase ordinary shares, to directors and/or employees of the Company and its subsidiaries, with the first and last exercise dates are 15 March 2001 and 15 December 2009, respectively. In October 2003, the Company issued additional 6.75 million warrants (with the same exercise price and exercise ratio as the existing ESOP) in order to comply with the criteria for adjusting the exercise price and ratio stipulated in the prospectus for these warrants, since the issuance of Warrant II and the offer of 30 million shares to specific investors under the rehabilitation plan have resulted in loss of rights and benefits for the holders of the original warrants. In conjunction with the Company没s stock split, whereby the par value of the shares changed from Baht 10 to Baht 1 per share, the number and exercise price of the warrants was adjusted, with the exercise price changing from Baht 6.68 to 19.56 per share to Baht 0.668 to 1.956 per share, the exercise ratio remaining at 1 warrant per 1 ordinary share and warrant holders to receive an additional 9 warrants, totaling 10 warrants, from 8 January 2004 onwards. In 2007, there were no warrants exercised to purchase new ordinary shares. As at 31 December 2007, 67,379,950 warrants remained unexercised. During the current year, 29,396,328 warrants were expired.

26. STATUTORY RESERVE Pursuant to Section 116 of the Public Limited Companies Act B.E. 2535, the Company is required to set aside to a statutory reserve at least 5 percent of its net income after deducting accumulated deficit brought forward (if any), until the reserve reaches 10 percent of the registered capital. The statutory reserve is not available for dividend distribution. According to Section 1202 of the Thai Civil and Commercial Code, subsidiaries (incorporated under Thai Laws) is required to set aside a statutory reserve equal to at least 5 percent of its income each time the subsidiaries pays out a dividend, until such reserve reaches 10 percent of its registered share capital. The statutory reserve can neither be offset against deficit nor used for dividend payment.

27. TREASURY SHARES/APPROPRIATED RETAINED EARNINGS FOR TREASURY SHARES On 28 February 2007, the Board of Directors of the Company approved a program to repurchase up to 832 million shares (par value of Baht 1 each), or 10 percent of the total number of shares in issue, with a budget of Baht 300 million, for liquidity surplus management purposes. The shares are to be repurchased on the Stock Exchange of Thailand between 15 March 2007 and 14 September 2007, and can be resold more than 6 months after completing the repurchase but within 3 years (15 March 2008 to 14 September 2010). As at 31 December 2007, the Company has purchased back 634 million ordinary shares (par value of Baht 1 each), or 7.6 percent of total number of shares in issue, a total of Baht 300 million (exclude cost of repurchase treasury shares). According to letter No. Gor Lor Tor. Chor Sor. (Vor) 2/2548 of the Office of the Securities and Exchange Commission, dated 14 February 2005, concerning the acquisition of treasury shares, a public limited company may buy back treasury shares in an amount not exceeding the amount of its retained earnings and is to appropriate an equal amount of retained earnings to a reserve for treasury shares, which must be maintained until the Company either sells the treasury shares or reduces its paid up share capital by an amount equal to the value of the treasury shares which it could not sell. As at 31 December 2007, the Company has already appropriated the full required amount of retained earnings to a reserve for the treasury shares. 104

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28. EARNINGS PER SHARE Basic earnings per share is calculated by dividing the net income (loss) for the year by the weighted average number of ordinary shares held by outsiders in issue during the year. Diluted earnings per share is calculated by dividing net income (loss) for the year by the weighted average number of ordinary shares held by outsiders in issue during the year plus the weighted average number of ordinary shares which would need to be issued to convert all dilutive potential ordinary shares into ordinary shares. The calculation assumes that the conversion took place either at the beginning of the year or on the date the potential ordinary shares were issued. Reconciliation between basic earnings per share and diluted earnings per share for the year ended 31 December 2007 and 2006 is presented below: Consolidated financial statements Weighted average number of ordinary shares

Net income (loss) 2007

2006

(Million Baht)

Basic earnings per share Net income (loss) Effect of dilutive potential ordinary shares Warrants offered to existing shareholders Diluted earnings per share Net income (loss) of ordinary shareholders assuming the conversion of warrants to ordinary shares

2006

(Million Baht) (Million Shares) (Million Shares)

(41)

236

7,928

8,320

-

-

298

382

(41)

236

8,226

8,702

Separate financial statements Weighted average number of ordinary shares

Net income (loss) 2007

2006

(Million Baht)

Basic earnings per share Net income (loss) Effect of dilutive potential ordinary shares Warrants offered to existing shareholders Diluted earnings per share Net income (loss) of ordinary shareholders assuming the conversion of warrants to ordinary shares

2007

2007

2006

(Million Baht) (Million Shares) (Million Shares) (Restated)

1,297

(31)

7,928

8,320

-

-

298

382

1,297

(31)

8,226

8,702

Earnings (loss) per share 2007

2006

(Baht)

(Baht)

(0.005)

0.028

(0.005)

0.027

Earnings (loss) per share 2007

2006

(Baht)

(Baht) (Restated)

0.164

(0.004)

0.158

(0.004)

ESOP were not included in calculation of diluted earning per share since the exercise prices of ESOP are higher than the average market price for the year. A n n u a l R e p o r t 2 0 0 7 Jasmine International Public Company Limited

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29. DIVIDEND PAID On 25 April 2007, the Annual General Meeting of the shareholders of the Company passed a resolution to pay a dividend of Baht 0.015 per share, or a total of Baht 125 million, to the shareholders from the 2006 income. As at the closing date of the share register, 8,235,161,523 of the Company没s ordinary shares were qualified to received dividend, after deduction of 67,847,800 shares held by the Company as treasury shares and 16,897,840 shares disqualified to receive this dividend by the registrar (Thailand Securities Depository Co., Ltd.) from the total number of shares outstanding (8,319,907,163 shares). The total dividend paid was thus Baht 124 million.

30. NUMBER OF EMPLOYEES AND RELATED COSTS Consolidated financial statements 2007 962 483

Number of employees at end of year (persons) Employee costs for the year (Million Baht)

Separate financial statements

2006 956 542

2007 68 41

2006 75 43

31. FINANCIAL INFORMATION BY SEGMENT The Company and its subsidiaries没 business operations involve the network and service provider segment, the provision, the design and installation of telecommunications systems segment and the other segments. These operations are mainly carried on Thailand. Below is the consolidated financial information for the years ended 31 December 2007 and 2006 of the Company and its subsidiaries by segment. (Unit: Million Baht) Network and service provider 2007 2006

Provision, design and installation of telecommunications systems 2007 2006

Sales and service income Revenue from external customers 3,291 3,231 737 Intersegment revenues 19 20 676 Total revenues 3,310 3,251 1,413 Segment operating profit (loss) 1,071 1,165 32 Unallocated income and expenses: Other income Fee for early redemption of senior secured notes Share of loss from investments accounted for using equity method Interest expenses Corporate income tax Minority interest Net income (loss)

106

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1,745 917 2,662 258

Other segments 2007 2006

Elimination of inter- segment transactions 2007 2006

Consolidated total 2007 2006

303 34 337 (58)

(729) (729) -

4,331 4,331 1,045

5,275 5,275 1,358

302 (644) (364) (317) (63)

573 (265) (391) (444) (394) (201)

(41)

236

299 30 329 (65)

(967) (967) -


(Unit: Million Baht)

Accounts receivable Inventories Property, plant and equipment Unallocated assets Total assets

Network and service provider 2007 2006 909 1,053 7 41 1,586 1,038

Provision, design and installation of telecommunications Other systems segments 2007 2006 2007 2006 1,329 1,721 39 38 73 53 1 530 737 1,419 1,693

Elimination of inter- segment transactions 2007 2006 (427) (803) (83) -

Consolidated total 2007 2006 1,850 2,009 80 95 3,452 3,468 9,597 11,868 14,979 17,440

Transfer prices between business segments are as set out in Note 8 to the financial statements.

32. PROVIDENT FUND The Company, its subsidiaries and their employees have jointly established a provident fund in accordance with the Provident Fund Act B.E. 2530. The Company, its subsidiaries and their employees contributed to the fund monthly at rate of 3-8 percent of basic salary. The fund, which is managed by Bangkok Bank PCL., will be paid to employees upon termination in accordance with the fund rules. During the year 2007, the Company and its subsidiaries contributed Baht 21 million, of which Baht 2 million is from the Company, to the fund (2006: Baht 22 million and Baht 2 million, respectively).

33. COMMITMENTS AND CONTINGENT LIABILITIES As at 31 December 2007, the Company and its subsidiaries had the following outstanding commitments and contingent liabilities. 33.1 The Company and its subsidiaries had outstanding commitments of approximately Baht 1,296 million in respect of performance bonds and bid bonds issued by banks and financial institutions on behalf of the Company and its subsidiaries (the Company only: Baht 96 million). 33.2 The Company had obligations in respect of its guarantee of the bank overdraft facilities of a subsidiary and letters of guarantee that have been issued by banks on behalf of subsidiaries, totaling Baht 7 million. 33.3 Subsidiaries had outstanding commitments under the letters of credit with local and overseas suppliers amounting to approximately USD 2 million and Baht 173 million. 33.4 ACeS Regional Services Co., Ltd., a subsidiary, had outstanding commitment in respect of the Founder NSP Airtime Purchase agreement made with ACeS International Limited, the owner of ACeS Satellite Project, a subsidiary company is obliged to pay a fee to ACeS International Limited in accordance with the agreement (ending date 1 January 2012). The fee is based on the greater of a minimum annual payment (USD 500,000) and a rate based on the volume of use of the satellite service, as specified in the agreement. 33.5 Acumen Co., Ltd., a subsidiary, had outstanding commitment in respect of the rental of satellite transponders, for which the rental is payable as follows: Million USD Payable within : 1 year 2 to 5 years

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33.6 Jasmine Internet Co., Ltd., a subsidiary, had entered into a 10-year agreement with TOT PCL. in order to lease on internet protocol network for information transmission (ending date 12 October 2011). The subsidiary is obliged to comply with certain conditions as stated in the agreement. 33.7 Compunet Corporation Limited (CPN), a subsidiary, had entered into an agreement with the National Telecommunications Commission (NTC) (formerly known as çthe Post and Telegraph Departmenté) to operate and provide domestic satellite data communication services for a period of 22 years. CPN is obliged to comply with certain provisions, including a commitment to transfer the ownership of communications equipment used in the provision of provide satellite data communications services to NTC free of charge and to pay a fee to NTC in accordance with the agreement, based on the greater of a minimum annual payment and a percentage of revenues from the services. However, during the year 2002 CPN requested NTC to amend such provision, and NTC made the following amendments: ë Reduction of the fee that CPN is to pay to NTC from the year 2001 until the end of the contract term to a rate of 9% of revenue before expenses per annum. ë Cancellation of the minimum fee to be paid to NTC from the year 2001 until the end of the contract term. In 2004, CPN issued a letter to NTC requesting the cancellation of the agreement because CPN has ceased its operations. However, CPN has not yet received a reply from NTC. 33.8 Triple T Broadband PCL. (TTT), a subsidiary, had entered into a leased line service agreement with TT&T PCL. (TT&T), an associate, whereby a monthly fee is to be paid at a rate specified in the agreement. In addition, TTT had entered into an agreement to provide telecommunication network services to a subsidiary company of TT&T in return for which it is to receive a monthly fee at a rate specified in the agreement. TTT is obliged to pay the leased line service fee to TT&T and provide service to the subsidiary of TT&T until 26 October 2018 and comply with certain conditions as stated in the agreements. TTT has assigned its rights over collection from the subsidiary of TT&T to secure accounts and notes payable for equipment, as described in Note 22 to the financial statements. 33.9 T.J.P. Engineering Co., Ltd. (TJP), a subsidiary, had entered into two turn-key agreements with TOT PCL. (TOT). TJP is obliged to deliver work within specific periods stipulated in the agreements, which are 180 days from the beginning date (due on 12 May 2006) under the first contact and 450 days from the beginning date (due on 23 September 2006) under the second contract. TJP has been unable to make delivery within the stipulated period. TOT is therefore entitled to charge a penalty to TJP at a rate of 0.1 percent of the contract value (Baht 87 million and Baht 34 million, respectively). However, the management of TJP is in the process of requesting an extension of the deadline for delivery and they believe that negotiations for such extension will be successful, because the delays were caused by a delay in the delivery of an area by a related government agency, and no penalty will be imposed. 33.10 Siam Teltech Computer Company Limited (Siam Teltech), a subsidiary, entered into a purchase and sales and services agreement with TT&T Public Company Limited (TT&T), an associated company, for the Customer Care & Billing System, under which Siam Teltech was to deliver the work to TT&T in accordance with the contract schedule. The due date for delivery was 1 May 2006, and this was later extended, with the agreement of both parties, to 20 December 2006. However, because TT&T made changes to its requirements during the development of the system, Siam Teltech had to amend its work and was unable to deliver the work within the scheduled delivery date. Currently, Siam Teltech is negotiating to amend the contract to extend the delivery date and the management of Siam Teltech believes that a contract extension will be granted. The contract stipulates a penalty charge for delays, calculated at 0.1 percent of the contract value per each day of delay (the contract value is USD 26 million), with the total penalty capped at 10 percent of the contract value. 108

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33.11 Telecommunications licenses The National Telecommunications Commission granted licenses to seven subsidiaries as follows. Company Acumen Co., Ltd

Triple T Broadband PCL. Jasmine Internet Co., Ltd. JasTel Network Co., Ltd. Triple T Internet Co., Ltd ACeS Regional Services Co., Ltd. Jasmine Telecom Systems PCL.

Type of license Type I Type II Type I Type II Type III Type I Type I Type II Type I Type I Type I

Authorised service Internet service Very Small Aperture Terminal (VSAT) service International calling card service International internet gateway service Network provider and service provider Internet service International calling card service Network provider Internet service Internet service Public telephone service

Periods 25 August 2007 - 24 August 2008 30 November 2007 - 29 November 2011 8 February 2007 - 7 February 2008 8 February 2007 - 7 February 2012 23 February 2006 - 22 February 2026 28 July 2007 - 27 July 2008 25 January 2008 - 24 January 2009 30 November 2006 - 29 November 2021 20 June 2007 - 19 June 2008 28 June 2007 - 27 June 2008 22 November 2007 - 21 November 2008

The subsidiaries have an obligation to pay license fee and comply with certain conditions as stated in the licenses.

34. FINANCIAL INSTRUMENTS 34.1 Financial risk management The Company and its subsidiariesû financial instruments, as defined under Thai Accounting Standard No. 48 çFinancial Instruments: Disclosure and Presentationsé, principally comprise cash and cash equivalents, trade accounts receivable, investments, bank overdrafts and short-term loans, trade accounts and notes payable, long-term loans, and long-term debts under rehabilitation plan. The financial risks associated with these financial instruments and how they are managed is described below. Credit risk The Company and its subsidiaries exposed to credit risk primarily with respect to trade accounts receivable, loans and other receivable. The Company and its subsidiaries manage the risk by adopting appropriate credit control policies and procedures and therefore do not expect to incur material financial losses. However, since the majority of sales and services are supplied to credit worthy customers such as the companies of which the major shareholder is government. The maximum exposure to credit risk is limited to the carrying amounts of trade receivables, loans and other receivable stated in the balance sheet. Interest rate risk The Company and its subsidiariesû exposure to interest rate risk relate primarily to its cash at banks, bank overdrafts, long-term borrowings and long-term debts under rehabilitation plan. However, since most of the Company and its subsidiariesû financial assets and liabilities bear floating interest rates or fixed interest rates which are close to the market rate, the interest rate risk is expected to be minimal.

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Foreign currency risk Its subsidiariesû exposure to foreign currency risk arises mainly from trading transactions that are denominated in foreign currencies. Its subsidiaries seek to reduce this risk by entering into forward exchange contracts when it considers appropriate. Generally, the forward contracts mature within one year. The balances of financial assets and liabilities denominated in foreign currencies as at 31 December 2007 are summarised below. Foreign currency

US dollar

Financial assets

Financial liabilities

(Million) 20

(Million) 29

Average exchange rate as at 31 December 2007 (Baht per 1 foreign currency unit) 33.7673

Foreign exchange contracts outstanding at 31 December 2007 are summarised below. Foreign currency US dollar Euro

Bought amount

Contractual exchange rate

(Million) 0.5 0.3

(Baht per 1 foreign currency unit) 33.8200 - 37.4235 47.0200 - 48.6000

34.2 Fair values of financial instruments Since the majority of the Company and its subsidiariesû financial instruments are short-term in nature. Long-term loans and long-term debts under rehabilitation plan carry interest at rates close to market rates. Their fair value is not expected to be materially different from the amounts presented in the balance sheets. A fair value is the amount for which an asset can be exchanged or a liability settled between knowledgeable, willing parties in an armûs length transaction. The fair value is determined by reference to the market price of the financial instrument or by using an appropriate valuation technique, depending on the nature of the instrument.

35. SUBSEQUENT EVENT On 26 February 2008, the Meeting of Board of Directors of Jasmine Telecom Systems PCL. (JTS), a subsidiary, proposed the payment of dividend of Baht 0.087 per share, a total of approximately Baht 61.1 million, from the 2007 income. This dividend proposal has yet to be approved at the next Annual General Meeting of the shareholders of JTS.

36. RECLASSIFICATION In addition to the change in accounting policy as described in Note 4 to the financial statements, which affects the previously reported net income and shareholderûs equity, certain other amounts in the financial statements for the year ended 31 December 2006 have been reclassified to conform to the current yearûs classification but with no effect to previously reported net income or shareholdersû equity other than from the change in accounting policy.

37. APPROVAL OF FINANCIAL STATEMENTS These financial statements were authorised for issue by the Companyûs Board of Directors on 28 February 2008. 110

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