Clarification Financial Statement Y 2006

Ref. No.: A/C ST. 0108/2007 February 22, 2007 Subject : Clarification of STEC' s financial statement ended 31 December 2006. To : President of the Stock Exchange of Thailand Dear Sirs, We, Sino-Thai Engineering & Construction Public Company Limited, would like to provide the clarification on yearly financial statement ended 31 December 2006 which shows the decreased of net profit in the amount of Baht 2,252.44 million equal to 476.44% comparing to the previous year due to the following reasons: 1. The company 's gross (loss) margin for this year was amount Baht (1,522.87) million comparing to the previous year at Baht 736.94 million. These amounts reflect the decreased of Baht 2,259.81 million, which equal to 306.65% due to the prices of construction materials, wages, oil, and transportation costs have significantly risen. 2. This year, provision for loss on construction project of the company increased at the amount of Baht 718.23 million comparing to the previous year since the prices of construction materials, wages, oil, and transportation costs have significantly risen. In addition, major construction contracts have been extended due to uncontrollable external factors. Because of these, the company has decided to reserve for loss on construction for long term projects and has recorded the whole amount of loss into its accounts. Please kindly be informed. Yours sincerely, ___________________________ (Mr. Woraphant Chontong) Director