NUAL FINANCIAL STATEMENTS 1999

US Dollar loans or an amount of US Dollars 103 million. As at December 31, 1999, the reserve was fully complied with the above. As at December 31, 1999, the deposits under these reserves bear interest at the rates of 3.75% - 6.04% per annum for the foreign currency deposits and 1.25% - 4.50% per annum for the Thai Baht deposits. 9 Spare parts and supplies, net Consolidated 1999 1998 Baht Baht Fuel 344,428,137 354,336,801 Specific spare parts 1,606,371,295 1,482,040,152 Common spare parts 37,958,367 41,654,198 1,988,757,799 1,878,031,151 Less: Provision for obsolete stocks (105,454,918) (93,708,097) 1,883,302,881 1,784,323,054 Company 1999 1998 Baht Baht Fuel - - Specific spare parts - - Common spare parts - - - - Less: Provision for obsolete stocks - - - - 10 Deposits at financial institutions This represents promissory notes issued by a financial institution for an exchange of promissory notes of financial institutions which were closed by the announcement of the Ministry of Finance on December 8, 1997. These promissory notes are due in 2000 and 2002 and bear interest at the rate of 4.125% per annum as at December 31, 1999. 11 Investments in subsidiaries and associates Consolidated 1999 1998 Baht Baht Opening net book balance 495,762,188 231,403,130 Adjustment for opening balance - - Opening net book balance after adjustment 495,762,188 231,403,130 Shares of profit from subsidiaries and associates 8,457,958 72,812,258 Acquisitions (Note 29) 500,000 191,546,800 Liquidation of associate (12,137,949) - Dividends received from subsidiaries and associates (11,732,258) - Change in net assets of subsidiaries and associates - - Closing net book value amount 480,849,939 495,762,188 Company 1999 1998 Baht Baht Opening net book balance 11,663,174,284 5,580,532,252 Adjustment for opening balance (717,907,246) (830,062,280) Opening net book balance after adjustment 10,945,267,038 4,750,469,972 Shares of profit from subsidiaries and associates 2,671,949,009 5,925,565,753 Acquisitions (Note 29) 241,500,000 296,850,000 Liquidation of associate - - Dividends received from subsidiaries and associates (1,057,506,268) (27,618,688) Change in net assets of subsidiaries and associates (12,350,000) - Closing net book value amount 12,788,857,779 10,945,267,037 The principal subsidiary undertakings are: Business Country of Incorporation Rayong Electricity Electricity generating Thailand Generating Company Limited Khanom Electricity Electricity generating Thailand Generating Company Limited EGCO Engineering and Power plant Thailand Services Company Limited maintenance services EGCO Joint Venture and Investing in power Thailand Development Company energy business Limited EGCO Mining Company Mining and other Thailand Limited Energy Egcom Tara Company Tap water business Thailand Limited % Ownership Interest 1999 Equity 1998 Equity method method Baht Baht Rayong Electricity 99.99 6,518,271,803 99.99 4,738,663,618 Generating Company Limited Khanom Electricity 99.99 5,547,372,116 99.99 5,454,692,574 Generating Company Limited EGCO Engineering and 99.99 80,692,504 99.99 141,706,504 Services Company Limited EGCO Joint Venture and 99.99 510,443,703 99.99 499,489,803 Development Company Limited EGCO Mining Company 70.00 15,975,869 69.99 110,714,539 Limited Egcom Tara Company 70.00 116,101,784 - - Limited The company invested in all subsidiaries by holding ordinary shares which have not been changed since 1998 except the acquisition of Egcom Tara Company Limited (Note 29). The principal associate undertakings are: Consolidated 1999 Business Relationship Paid-up Portion of share capital Investment Baht (%) AMATA EGCO Electricity Associate 1,350,000 29.70 Power Company generating Limited AMESCO Company Power Associate 2,000,000 50.00 Limited (the old plants name is CMESCO operation Company Limited) ESCO Wood Power plants Associate 20,000,000 45.00 Company Limited equipments maintenance AGRO Energy Trading/ Associate 500,000 99.99 Company Limited delivery services of natural scrap Cost mthod Equity method Dividend Baht Baht Baht AMATA EGCO 400,950,000 477,803,682 - Power Company Limited AMESCO Company 1,000,000 2,546,257 - Limited (the old name is CMESCO Company Limited) ESCO Wood 9,000,000 - - Company Limited AGRO Energy 500,000 500,000 - Company Limited Consolidated 1998 Business Relationship Paid-up Portion of share capital investment Baht (%) AMATA EGCO Electricity Associate 1,350,000 29.70 Power Company generating Limited AMESCO Company Power plants Associate 2,000,000 50.00 Limited (the old operation name is CMESCO Company Limited) ESCO Wood Power plants Associate 20,000,000 45.00 Company Limited equipments maintenance Bangchak Power Electricity Associate 40,000,000 30.00 Company Limited generating Cost method Equity method Dividend Baht Baht Baht AMATA EGCO 400,950,000 466,908,685 - Power Company Limited AMESCO Company 1,000,000 16,751,479 - Limited (the old name is CMESCO Company Limited) ESCO Wood 9,000,000 426,675 - Company Limited Bangchak Power 12,000,000 11,675,349 - Company Limited The operating results of these associates are based on the financial statements that have not been audited by the associates' auditors. 12 Other long-term investments 1999 Consolidated Available for sale Ohter investment Baht Baht Debt securities - - Equity securities 189,189,190 37,799,995 Add Adjustment for changes In fair value of Investment 991,633 - 190,180,823 37,799,995 Total 227,980,818 1999 Company Available for sale Ohter investment Baht Baht Debt securities - - Equity securities 189,189,190 37,799,995 Add Adjustment for changes In fair value of Investment 991,633 - 190,180,823 37,799,995 Total 227,980,818 Consolidated 1999 1998 Baht Baht Opening net book amount 544,799,995 37,799,995 Acquisitions 189,189,190 507,000,000 Disposals (507,000,000) - Change in fair values of Investment 991,633 - Closing net book amount 227,980,818 544,799,995 Company 1999 1998 Baht Baht Opening net book amount 537,799,995 37,799,995 Acquisitions 189,189,190 500,000,000 Disposals (500,000,000) - Change in fair values of Investment 991,633 - Closing net book amount 227,980,818 537,799,995 13 Property, plant and quipment, net Consolidated Land & Power Plants buildings & Substation and Transmission System Baht Baht At 31 December 1998 Cost 4,121,523,188 29,170,051,301 Less Accumulated depreciation (419,669,967) (4,888,736,699) Net book amount 3,701,853,221 24,281,314,602 Year ended 31 December 1999 Opening net book amount 3,701,853,221 24,281,314,602 Additions 657,724,492 88,554,367 Disposals/transfer - (9,596) Depreciation charge (Note 22) (152,784,166) (1,488,831,758) Closing net book amount 4,206,793,547 22,881,027,615 At 31 December 1999 Cost 4,779,247,680 29,258,590,618 Less Accumulated depreciation (572,454,133) (6,377,563,003) Net book amount 4,206,793,547 22,881,027,615 Equipment Construction Total & Vehicles in progress Baht Baht Baht At 31 December 1998 Cost 145,773,256 569,515,173 34,006,862,918 Less Accumulated depreciation (65,077,490) - (5,373,484,156) Net book amount 80,695,766 569,515,173 28,633,378,762 Year ended 31 December 1999 Opening net book amount 80,695,766 569,515,173 28,633,378,762 Additions 119,660,282 213,742,270 1,079,681,411 Disposals/transfer (3,263,948) (758,663,291) (761,936,835) Depreciation charge (Note 22) (38,052,400) - (1,679,668,324) Closing net book amount 159,039,700 24,594,152 27,271,455,014 At 31 December 1999 Cost 257,637,925 24,594,152 34,320,070,375 Less Accumulated depreciation (98,598,225) - (7,048,615,361) Net book amount 159,039,700 24,594,152 27,271,455,014 Company Land & Equipment buildings & Vehicles Baht Baht At 31 December 1998 Cost 284,429,028 63,540,070 Less Accumulated depreciation - (33,337,914) Net book amount 284,429,028 30,202,156 Year ended 31 December 1999 Opening net book amount 284,429,028 30,202,156 Additions 629,886,428 95,825,078 Disposals/transfer - - Impairment of assets - (98,978) Depreciation charge (Note 22) (20,043,330) (22,184,505) Closing net book amount 894,272,126 103,743,751 At 31 December 1999 Cost 914,315,456 159,031,506 Less Accumulated depreciation (20,043,330) (55,287,755) Net book amount 894,272,126 103,743,751 Construction Total in progress Baht Baht At 31 December 1998 Cost 534,433,877 882,402,975 Less Accumulated depreciation - (33,337,914) Net book amount 534,433,877 849,065,061 Year ended 31 December 1999 Opening net book amount 534,433,877 849,065,061 Additions 152,462,636 878,174,142 Disposals/transfer (686,896,513) (686,896,513) Impairment of assets - (98,978) Depreciation charge (Note 22) - (42,227,835) Closing net book amount - 998,015,877 At 31 December 1999 Cost - 1,073,346,962 Less Accumulated depreciation - (75,331,085) Net book amount - 998,015,877 Depreciation for the year of Baht 1,679,668,324 has been charged to the consolidated statement of income (1998: Baht 1,640,717,606) and Baht 42,227,835 to the company statement of income (1998: Baht 11,299,899). Land, buildings and equipments of power plants, which are specified in the Master Agreement, are mortgaged and pledged as collateral in accordance with the loan agreements (as mentioned in notes 15 and 16). 14 Other assets Consolidated 1999 1998 Baht Baht Opening book balance 730,280,849 842,188,346 Adjustment for opening balance(note 2) (717,907,246) (830,062,280) Opening book balance after adjustment 12,373,603 12,126,066 Addition 26,582,411 247,538 Closing book balance 38,956,014 12,373,604 Other assets in the consolidated financial statements mainly consist of refundable deposits. 15 Long-term loans The long-term loans are loans in US Dollar and Thai Baht of the two subsidiaries as follows : Consolidated 1999 1998 Baht Baht Long-term loans in US Dollar 15,974,960,682 16,591,398,000 Long-term loans in Thai Baht 2,491,750,360 2,769,000,000 18,466,711,042 19,360,398,000 Less: Current portion of long-term loans (1,447,976,484) (1,200,557,900) 17,018,734,558 18,159,840,100 Company 1999 1998 Baht Baht Long-term loans in US Dollar - - Long-term loans in Thai Baht - - Less: Current portion of long-term loans - - - - 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. 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 Total facilities as at December 31, 1999 (million) (million) Loans of Rayong Electricity Generating Company Limited USD 93 55.8 USD 48 28.8 USD 141 139.59 Baht 3,550 2,485.00 Loans of Khanom Electricity Generating Company Limited USD 100 86.00 USD 165 141.90 Baht 225 Not yet be drawdown Term of repayment Interest rate (years) (% per annum) Loans of Rayong Electricity Generating Company Limited 10 LIBOR plus a certain margin 10 LIBOR plus a certain margin 15 Fixed at 8.85% 12 MLR minus a certain margin Loans of Khanom Electricity Generating Company Limited 12 LIBOR plus a certain margin 12 LIBOR plus a certain margin 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 at 8.12% and 8.22% per annum for 2 tranches of loan amounting to US Dollars 93 million and US Dollars 48 million, respectively. The agreement is effective from November 30, 1994 to December 7, 2004. On September 30, 1999, the lenders of the Thai Baht loans have transferred the right to receive the loan repayment amounting to Baht 1,517 million to the Mutual Fund, namely REGCO Loan Fund (1). On the same date the Mutual Fund has settled the loans of Baht 1,517 million due by the subsidiary. The loan bears interest at 8% per annum. The repayment schedule for principal and interest is semi-annually. In addition, the company has entered into an interest rate swap agreement to convert the floating interest rate to a fixed rate of 8% per annum for the remaining Thai Baht loan of Baht 1,110 million. The repayment schedules for principal and interest are semi-annually and monthly basis respectively. On May 9, 1996, Khanom 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 a fixed interest rate at 8.0275% per annum for the loan amounting to US Dollars 165 million. In addition, there is a currency and interest rate swap agreement to convert the loan amounting to 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 December 31, 1999 amounting to US Dollars 86 million, equals to Baht 2,170 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 repayments of principal and interest due within one year, and other conditions as described in note 8 to the financial statements. Also, a reserve for minimising the 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 the conditions under the Master Agreements. 16 Debentures The debentures are debentures in Thai Baht of the company and two subsidiaries as follows : Consolidated 1999 1998 Baht Baht Debentures 13,860,477,743 10,102,339,783 Less: Current portion of debentures (390,660,000) (973,695,000) 13,469,817,743 9,128,644,783 Company 1999 1998 Baht Baht Debentures 5,000,000,000 - Less: Current portion of debentures - - 5,000,000,000 - The debenture information of the company is summarised as follows; Outstanding balance Term of repayment as at December 31,1999 (Baht million) (years) Debentures 5,000 5 Interest rate Final repayment (% per annum) date Debentures 8 Oct 21, 2004 The debentures of the company are private placement , totalling 5,000,000 units of Baht 1,000 face value each, for a total of Baht 5,000 million. The debentures are repayable semi-annually commencing from 2001 2004. The debeutures bear fixed interest at the rate of 8% per annum and the interest is paid semi-annually. The company is required to comply with the conditions set out in the agreement. The debenture information of the two subsidiaries is summarised as follows ; Outstanding balance Term of repayment Interest rate Final as at December 31,1999 repayment (Baht million) (years) (% per annum) date Rayong Electricity Generating Company Limited Debentures No.1 1,875 5,7,10,12 11.25% Dec. 7, 2006 Debentures No.2 700 1-12 11.25% Dec. 7, 2006 Khanom Electricity Generating Company Limited Debentures 6,678 15 11.5625 June 14, 2011 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 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, in 1995 - 2006. The interest rate 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 at the rate of 11.5625 per annum. Both subsidiaries are also required to maintain a reserve for repayment of principal and interest due within one year and to pledge the relevant agreements as collateral as mentioned in note 15. 17 Minority interest Consolidated 1999 1998 Baht Baht (more)