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million Baht in 2003, increasing by 48.64 million Baht or 23.42%. The major factors were allowance for diminution in value of inventories, transportation cost, consulting fee, and export expenses. Because of the increase of sales. However, S&A expenses as a proportion of sales values declined from 6.22% in 2003 to 6.04% in 2004, the lowest level since 1997 and representing a continuous reduction since 2001. Interest expense: During the year 2004, the Company borrowed both short-term and long-term loans from commercial banks as working capital and to fund its investment in UFC. At the end of 2004, the Company’s outstanding short-term and long-term loans increased by 495 million Baht and 265.19 million Baht respectively. Interest expense in 2004 correspondingly increased by 10.67 million Baht from 2003. Profits Gross profit: Gross profit margin in 2004 was at 7.18%, lower than 12.01% in 2003 owing to the reasons explained above as well as pricing competition in the market for finished products. Even though sales volume increased, such increase could not compensate for the increase in cost of sales, hence the gross profit dropped from 401.20 million Baht in 2003 to 304.89 million Baht in 2004. In the consolidated 2004 financial statements, gross profit margin was 14.44%. Operating profit: The Company recorded an operating profit in 2004 at 81.90 million Baht, representing 59.49% decrease from 2003 in tandem with the 33.99% increase in cost of goods sold. Operating profit margin in 2004 at 1.93% was lower than 6.05% of 2003. In the 2004 consolidated financial statements, operating profit margin recorded at 5.03%. Net profit: The Company recorded net profit in 2004 of 134.15 million Baht, down 82.76 million Baht or 38.15% from 2003. Net profit margin in 2004 decreased from 6.35% in 2003 to 3.07% while profit sharing from investment increased 26.77%. Net profit margin of the consolidated financial statements in 2004 was 2.61%. Dividend payout ratio: In 2004, earnings per share was 0.18 Baht (weighted average number of shares at 738 million shares). The Board of Directors resolved to approve the interim dividend payment 42

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LST_2004 LAM SOON (THAILAND) PCL Annual Report 2004

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LST_2004 LAM SOON (THAILAND) PCL Annual Report 2004

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