F/S Q1-1999 EGCOMP

Consolidation 1998 Paid-up share % of capital holding (Baht'000) Associated companies AMATA EGCO Power Company Limited 696,000 29.70 Bangchak Power Company Limited 40,000 30.00 AM ESCO Company Limited 2,000 50.00 (formerly named as CM ESCO) ESCO Wood Company Limited 20,000 45.00 Other companies Thai LNG Power Company Limited - 10.00 PMI International Company Limited - 10.00 Consolidation 1998 Cost method Equity method (Baht'000) (Baht'000) Associated companies AMATA EGCO Power Company Limited 229,053 - Bangchak Power Company Limited 12,000 - AM ESCO Company Limited 1,000 - (formerly named as CM ESCO) ESCO Wood Company Limited 9,000 - Total investment in associated companies 251,053 - Cost value Other companies (Baht'000) Thai LNG Power Company Limited 37,499 PMI International Company Limited 300 Investment in Open-End Fixed Income Fund - Total investments in other companies 37,799 Loan to an associated company - The financial statements for the three-month periods ended March 31, 1999 include shares of net loss totalling Baht 21 million from the four associates (The three-month period ended March 31, 1998 : nil). The financial statements for such period of these associates have not been reviewed by these companies' auditors. Unaudited Reviewed Electricity Generating Public Company Limited Page 15 Notes to the financial statements and consolidated financial statements - March 31, 1999 continued Long-term loans 8. The long-term loans are loans in US Dollars and Thai Baht of the two subsidiaries as follows : Consolidation 1999 1998 (Baht'000) (Baht'000) Long-term loans in US dollars 16,941,360 18,296,615 Long-term loans in Thai Baht 2,769,000 3,017,500 19,710,360 21,314,115 Less: Current portion of long-term loans (1,220,490) (1,103,287) 18,489,870 20,210,828 The long-term loans of Rayong Electricity Generating Company Limited are the loans under the Master Agreement, Credit Agreement and Institutional Loan Agreement, each dated November 30, 1994 and the long-term loans of Khanom Electricity Generating Company Limited are the loans under the Master Agreement and Bank Credit Agreement, each dated June 3, 1996. The loan information of the two subsidiaries is summarised as follows : Outstanding balance Term of Total facilities as at March 31, 1999 repayment Interest rate (million) (million) (years) (% per annum) Loans of Rayong Electricity Generating Company Limited USD 93 65.1 10 LIBOR plus a certain margin USD 48 33.6 10 LIBOR plus a certain margin USD 141 141.0 15 8.85% Baht 3,550 2,769.0 12 MLR minus a certain margin Unaudited Reviewed Electricity Generating Public Company Limited and its subsidiaries Page 16 Notes to the financial statements and consolidated financial statements - March 31, 1999 continued Loans of Khanom Electricity Generating Company Limited USD 100 90 12 LIBOR plus a certain margin USD 165 148.5 12 LIBOR plus a certain margin Baht 225 (not yet be drawdown) 15 MLR minus a certain margin Rayong Electricity Generating Company Limited entered into an interest rate swap agreement to convert a floating interest rate based on LIBOR plus a certain margin, to fixed interest rates of 8.12% and 8.22% per annum for 2 tranches of loan amounts of US Dollars 93 million and 48 million, respectively. The agreement is effective from November 30, 1994 to December 7, 2004. On May 9, 1996, Khanom Electricity Generating Company Limited entered into the interest rate swap agreement to convert a floating interest rate based on LIBOR plus a certain margin to a fixed interest rate of 8.0275% per annum for the loan amount of US Dollars 165 million. In addition, there is a currency and interest rate swap agreement to convert the loan amount of US Dollars 100 million with a floating interest rate to Thai Baht currency at a fixed interest rate of 11% per annum. As a result, the balance of this loan as at March 31, 1999, amounting to US Dollars 90 million, equals to Baht 2,271 million. These agreements are effective from June 19, 1996 to June 14, 2008. The Master Agreements of both subsidiaries have certain clauses which state that cash reserves are to be provided from the proceeds of sales of electricity for repayment of principal and interest due within one year, and other conditions as described in note 6 to the financial statements. Also, a reserve for exchange risk shall be provided as described in the same note. In addition, the PPAs, the Asset Purchase Agreements, the Major Maintenance Agreements, insurance policies, and other related agreements with the lenders have been assigned as collateral in accordance with conditions under the Master Agreements. Unaudited Reviewed Electricity Generating Public Company Limited Page 17 Notes to the financial statements and consolidated financial statements - March 31, 1999 continued Debentures Consolidation 9. 1999 1998 (Baht'000) (Baht'000) Debentures 10,130,438 10,406,670 Less: Current portion due within one year (969,972) (310,093) 9,160,466 10,096,577 The debentures of Rayong Electricity Generating Company Limited are under the Master Agreement and Debenture Holder Representative Appointment Agreement No. 1 and No. 2, each dated November 30, 1994. The debentures of Khanom Electricity Generating Company Limited are under the Master Agreement and the Statements of the Terms and Conditions Regarding the Rights and Obligations of the Issuer and the Debentureholders which were dated June 3, 1996 and June 19, 1996, respectively. The debenture information of the two subsidiaries is summarised as follows : Outstanding balance Term of as at Mar. 31, 1999 repayment Interest rate Due date (Baht million) (years) (% per annum) Rayong Electricity Generating Company Limited Debentures No. 1 2,500.0 5,7,10,12 11.25% Dec.7, 2006 Debentures No. 2 780.0 1-12 11.25% Dec.7, 2006 Khanom Electricity Generating Company Limited Debentures 6,946.7 15 11.5625% June 14, 2011 Unaudited Reviewed Electricity Generating Public Company Limited Page 18 Notes to the financial statements and consolidated financial statements - March 31, 1999 continued The No. 1 debentures of Rayong Electricity Generating Company Limited are divided into 4 parts, being repayable in 5 years, 7 years, 10 years, and 12 years in 1999, 2001, 2004 and 2006, respectively. The No. 2 debentures are divided into 12 parts, being repayable in 1 - 12 years, from 1995 - 2006. The interest is payable semi-annually. The debentures of Khanom Electricity Generating Company Limited are secured debentures with the holders' names being registered, totalling 750,000 units of Baht 10,000 face value each, for a total of Baht 7,500 million. The total debentures were offered to the public and are repayable within 15 years from the date of issuance on June 14, 1996, at six monthly intervals to 2011. The interest is payable semi-annually. Both subsidiaries are also required to maintain a reserve for repayment of principal and interest and to pledge the relevant agreements as collateral as mentioned in note 8. Cost of sales 10. Cost of sales is comprised of main expenses; repair and maintenance expenses, depreciation expenses, and insurance expenses. Major repair and maintenance expenses are recorded as expenses when are incurred. Commencing from the second quarter of 1998, a reserve for repair and maintenance based on the annual budget of major repair and maintenance expenses, is included in the interim financial statements. The major repair and maintenance expenses for the three-month period ended March 31,1999 amounted to Baht 114 million. Unaudited Reviewed Electricity Generating Public Company Limited Page 19 Notes to the financial statements and consolidated financial statements - March 31, 1999 continued Currency exchange losses (gains) 11. Currency exchange losses (gains) in the consolidated financial statements mainly related to the translation of long-term loans of the two subsidiaries in US dollar to Thai Baht at the exchange rates ruling at the balance sheet date. Shares of profits from subsidiaries for the three-month periods of 1999 and 1998 includes losses (gains) on currency exchange of Baht 229 million and Baht (2,632) million, respectively. Commitment and contingent liabilities 12. (a) As at March 31, 1999 the company has commitments under contracts for construction of Baht 121 million and had credit facilitiesto a subsidiary company as a short-term loan amounting to Baht 10 million. (b) As at March 31, 1999 the company has commitments under the Sponsor Support Agreement, which made for subsidiary and associated companies in respect of the following on behalf of the company : Currency Baht US Dollar Raw material purchase - 5,292,300 Performance bond 23,842,387 536,079 (c) As at March 31, 1999, the two subsidiaries had not entered into forward exchange contracts to cover the exchange risk relating to long-term loans of US Dollars 387.5 million. However, such exchange risk is partially covered by "The First Amendment to Power Purchase Agreements" dated January 30, 1998 as described in note 5. Unaudited Reviewed Electricity Generating Public Company Limited Page 20 Notes to the financial statements and consolidated financial statements - March 31, 1999 continued (d) The two subsidiaries have entered into insurance agreements with two local insurers. These agreements are for the purpose of insurance on the power plants, a certain number of equipment, consequent loss, and third party liabilities, covering a period of 3 years commencing on December 31, 1998 and January 1, 1999. The premium for such insurance for the first year will be paid at US Dollars 1,167,885 and for the next two years at the agreed amounts on the condition that there will be no claims occurred in such period. (e) A subsidiary of the company also entered into spare parts repair service agreements with two suppliers one of which is an affiliated company. According to the agreements, the subsidiary has committed to have these suppliers repair a certain number of spare parts specified in the agreements. These agreements, totalling Baht 49.9 million and GBP 895,438, shall be effective for a period of 2 years commencing in the first quarter of 1999. Comparative figures 13. As a result of reclassifications of certain items in the 1999 interim financial statements, the comparative figures in the 1998 financial statements have been amended accordingly. Statement of cash flows for the three-month period of 1999 has been prepared in accordance with the regulation of the Stock Exchange of Thailand. The comparative statement of cash flows for the three-month period of 1998 has been prepared accordingly. Unaudited Reviewed Electricity Generating Public Company Limited Page 21 Notes to the financial statements and consolidated financial statements - March 31, 1999 continued The Year 2000 issue 14. As of March 1999, the company is in the Implementation phase - the final step to resolve the Year 2000 problem. The expected problems which will impact on Power Generation System and Plant Maintenance System, have been resolved ahead of time (scheduled for completion in September 1999). For external supply system, Fuel Supply System (Natural Gas), it has been certified by the Petroleum Authority of Thailand (PTT) to comply with The Year 2000 by the statement of Yogokawa (Thailand) Ltd. The expenditures incurred are approximately 50 % of the total budget. (Budget is about Baht 66 million) The Implementation phase and the contingency plan will be completed within the plan schedule. Auditor's report page 1.