NUAL FINANCIAL STATEMENTS

fabrication ACS Asia (1996) Company Manufacturing cable Thailand Shareholders 15,000,000.00 15,000,000.00 50 50 7,500,000.00 7,500,000.00 16,833,902.61 8,396,438.92 - - Limited support system MMR Asia Company Limited Electrical and Thailand Shareholders 30,000,000.00 30,000,000.00 45.12 45.12 8,998,950.00 8,998,950.00 - - - - instrumentation contractor THE COMPANY Company's name Type of Business Country Relation Issued shares capital Percentage of Cost method Equity method Dividend 1998 1997 share holding 1998 1997 1998 1997 1998 1997 Baht Baht 1998 1997 Baht Baht Baht Baht Baht Baht Associated Companies Thai Maintenance Maintenance service Thailand Shareholders 12,315,000.00 12,315,000.00 25.14 30 2,339,810.00 2,339,810.00 7,346,734.34 1,589,893.20 - - contracting Company for industrial Limited plants 356,628,365.00 425,709,540.00 330,044,214.73 494,895,028.82 2,799,600.00 39,310,480.0 0 Less Allowance for decline in investment - - (8,985,576.90) - - - Total Investments in Associated Companies 356,628,365.00 425,709,540.00 321,058,637.83 494,895,028.82 2,799,600.00 39,310,480.0 0 STP & I Public Steel fabrication, Thailand Shareholders 250,000,000.00 - 10 - 75,750,054.30 - - - - - Company Limited steel construction, industrial boilers and pressure vessels manufacturing Abico Land Company Limited Thailand Shareholders 200,000,000.00 200,000,000.00 15 15 30,000,000.00 30,000,000.00 - - - - Nithipat Leasing Company Limited Thailand Shareholders 800,000,000.00 800,000,000.00 11.25 11.25 97,167,600.00 97,167,600.00 - - - - National Insurance Company Thailand Shareholders - 300,000,000.00 - 10 - 30,000,000.00 - - - - Limited National Life Insurance - 500,000,000.00 - 10 - 50,000,000.00 - - - - Company Limited Nakornthai Stripmill Public Thailand Shareholders 8,600,000,000.00 5,600,000,000.00 1.85 3.01 254,000,000.00 270,000,000.00 - - - - Company Limited Peroxy Thai Company Limited Thailand Shareholders 793,000,000.00 793,000,000.00 2.73 2.73 21,650,000.00 21,650,000.00 - - - - Others 42,264,798.78 82,264,748.78 520,832,453.08 581,082,348.78 - - - - Less Allowance for decline in investment (286,673,530.08) (287,702,508.25) - - - - Total investments in other related parties 234,158,923.00 293,379,840.53 - - - - In the Company's financial statements, investments in Nithipat Leasing Company Limited and Peroxy Thai Company Limited as at December 31, 1998 are stated at cost amounting to Baht 97.17 million and Baht 21.65 million, respectively, have corresponding book values amounting to Baht 37.90 million and Baht 0 respectively. The Company has not set up a provision against decline in value of these investments due to the management believe that these two companies may rehabilitate in the future. CONSOLIDATED Company's name Type of Business Country Relation Issued shares capital Percentage of Cost method Equity method Dividend 1998 1997 share holding 1998 1997 1998 1997 1998 1997 Baht Baht 1998 1997 Baht Baht Baht Baht Baht Baht Joint ventures Philipp Holzmann (Thai)/ Thailand Joint Venture - - 100 - - - - - - - U.T.M. Engineering/ Sino-Thai Joint Venture Zueblin W&F-Stecon Joint Venture Thailand Joint Venture - - 33 - - - - - - - The Joint Venture of Thailand Joint Venture - - 33 - - - - - - - Tomen Enterprise (Bangkok) Company Limited/Sino-Thai Engineering and Construction Public Company Limited/ Totems Company Limited Total Investment in Joint Ventures - - - - - - Subsidiaries Sino-Thai construction Rental,Trading in Thailand Shareholders and 30,000,000.00 30,000,000.00 99.99 99.99 - - - - - - services construction Co-management Company Limited equipment and heavy machinery Sino-Thai Resources Mining Thailand Shareholders and 130,000,000.00 130,000,000.00 51.16 51.16 - - - - - - Development Public Company Limited Co-management - - - - - - Total investment in Subsidiaries CONSOLIDATED Company's name Type of Business Country Relation Issued shares capital Percentage of Cost method Equity method Dividend 1998 1997 share holding 1998 1997 1998 1997 1998 1997 Baht Baht 1998 1997 Baht Baht Baht Baht Baht Baht AAssociated Companies HTR Corporation Limited Real estate Thailand Shareholders 500,000,000.00 500,000,000.00 47.6 47.6 329,990,005.00 329,990,005.00 266,705,743.80 295,042,917.29 - - Development CBI/ST Company Limited Manufacturing Thailand Shareholders - 100,000,000.00 - 35 - 9,082,075.00 - - - 24,511,060.00 and Erection of spherical & cylin drical tank STP & I Public Steel fabrication,Thailand Shareholders - 250,000,000.00 - 24 - 59,999,100.00 - 155,473,300.83 - 11,999,820.00 Company Limited steel construction, industrial boilers and pressure vessels manufacturing DKK Sino-Thai Engineering Telecommunications Thailand Shareholders 8,000,000.00 8,000,000.00 35 35 2,799,600.00 2,799,600.00 30,172,257.05 26,294,822.96 2,799,600.00 2,799,600.00 Company Limited and transmission Lines ASC Asia Limited Light steel Thailand Shareholders 10,000,000.00 10,000,000.00 50 50 5,000,000.00 5,000,000.00 8,985,576.90 8,097,655.58 - - Fabrication ACS Asia (1996) Manufacturing cable Thailand Shareholders 15,000,000.00 15,000,000.00 50 50 7,500,000.00 7,500,000.00 16,833,902.61 8,396,438.92 - - Company Limited support system MMR Asia Company Electrical and Thailand Shareholders 30,000,000.00 30,000,000.00 45.12 45.12 11,998,950.00 11,998,950.00 3,000,000.00 3,000,000.00 - - Limited instrumentation Contractor Thai Maintenance Maintenance service Thailand Shareholders 12,315,000.00 12,315,000.00 25.14 30 2,339,810.00 2,339,810.00 7,346,734.34 1,589,893.20 - - contracing Company for Limited industrial plants 359,628,365.00 428,709,540.00 333,044,214.70 497,895,028.78 2,799,600.00 39,310,480.00 Less Allowance for decline in investment (3,000,000.00) - (11,985,576.90) - - - Total Investments in Associated Companies 356,628,365.00 428,709,540.00 321,058,637.80 497,895,028.78 2,799,600.00 39,310,480.00 CONSOLIDATED Company's name Type of Business Country Relation Issued shares capital Percentage of Cost method Equity method Dividend 1998 1997 share holding 1998 1997 1998 1997 1998 1997 Baht Baht 1998 1997 Baht Baht Baht Baht Baht Baht Other related parties STP & I Public Steel fabrication, Thailand Shareholders 250,000,000.00 - 10 - 75,750,054.30 - - - - - Company Limited steel construction, Industrial boilers and pressure vessels manufacturing Abico Land Company Limited Thailand Shareholders 200,000,000.00 200,000,000.00 15 15 30,000,000.00 30,000,000.00 - - - - Nithipat Leasing Company Limited Thailand Shareholders 800,000,000.00 800,000,000.00 15 15 129,567,600.00 129,567,600.00 - - - - National Insurance Company Thailand Shareholders - 300,000,000.00 - 10 - 30,000,000.00 - - - - Limited National Life Insurance Thailand Shareholders - 500,000,000.00 - 10 - 50,000,000.00 - - - - Company Limited Nakornthai Stripmill Public Thailand Shareholders 8,600,000,000.00 5,600,000,000.00 1.85 3.01 254,000,000.00 270,000,000.00 - - - - Company Limited Peroxy Thai Company Limited Thailand Shareholders 793,000,000.00 793,000,000.00 2.73 2.73 21,650,000.00 21,650,000.00 - - - - Others 44,064,798.78 118,414,775.63 - - - - Total 555,032,453.08 649,632,375.63 - - - - Less Allowance for decline in investment (286,673,530.08) (287,702,508.25) - - - - Total Investment in Other Related parties 268,358,923.00 361,929,867.38 - - - - In the consolidated financial statements, the investments in Nithipat Leasing Company Limited and Peroxy Thai Company Limited as at December 31, 1998 are stated at cost amounting to Baht 97.17 million and Baht 21.65 million, respectively, have corresponding book values amounting to Baht 37.90 million and Baht 0 million respectively. The Company has not set up a provision against decline in valued of these investments due to the management believe that these two companies may rehabilitate in the future. 5.5.2 Loans to related parties CONSOLIDATED THE COMPANY Policy for charging interest on loans 1998 1997 1998 1997 CONSOLIDATED THE COMPANY Baht Baht Baht Baht Joint Venture Philipp Holzmann (Thai) /U.T.M. Engineering / - 670,000,000.00 - 670,000,000.00 15% 15% Sino-Thai Joint Venture The Joint Venture of Tomen Enterprise (Bangkok) 7,837,461.49 - 7,837,461.49 - 15% 15% Company Limited/Sino-Thai Engineering and Construction Public Company Limited/Totems Company Limited - - - - 7,837,461.49 670,000,000.00 7,837,461.49 670,000,000.00 Subsidiary Sino-Thai Construction Service Company Limited - - 23,835,268.99 35,000,000.00 - 7.27744-24% Associated Companies MMR Asia Company Limited - 10,000,000.00 - 10,000,000.00 17% 17% ACS Asia (1996) Company Limited 4,293,625.00 5,093,625.00 4,293,625.00 5,093,625.00 14.75% 14.75% 4,293,625.00 15,093,625.00 4,293,625.00 15,093,625.00 Other Related parties Others 4,240,000.00 4,240,000.00 4,240,000.00 4,240,000.00 13-18% 13-18% Less Allowance for doubtful accounts (90,000.00) - - - 4,150,000.00 4,240,000.00 4,150,000.00 4,240,000.00 Total Loans 16,281,086.49 689,333,625.00 40,116,355.48 724,333,625.00 Total Investments and Loans 605,698,647.29 1,549,158,521.16 687,788,810.43 1,598,645,660.94 The Company recorded deficit in shareholders' equity of associated companies and joint venture amounting to approximately Baht 74.57 million, which was shown under other liabilities. The Company recorded investments in associated companies and joint ventures by using the equity method in the financial statements for the year ended December 31, 1998 on the basis of the financial information obtained from the management which had not been audited or reviewed by the auditors in accordance with standards established by the Thai Institute of Certified Accountants and Auditors of Thailand for the recording of investments in associated companies and joint ventures. The Company recorded investments in subsidiaries and associated companies by using the equity method in the financial statements for the year ended December 31, 1997 on the basis of the financial information obtained from the management which had not been audited or reviewed by the auditors in accordance with standards established by the Thai Institute of Certified Accountants and Auditors of Thailand for the recording of investments in subsidiaries and associated companies. 5.6 The Company significant transactions with its related parties for the year ended December 31, are as follows: CONSOLIDATED THE COMPANY 1998 1997 1998 1997 Baht Baht Baht Baht Revenues from construction - 139,483,439.94 - 139,483,439.94 Revenues from services, rent and others - 47,701.20 1,395,625.01 2,109,176.22 Interest income - - 9,016,523.70 6,221,301.37 Equipment purchase - - 1,692,925.00 17,607,550.00 Concrete service and others - - 2,308,300.00 826,890.01 (More)