do day dream public company limited and its...

Do Day Dream Public Company Limited

and its Subsidiaries

Interim financial statements

for the three-month period ended

31 March 2019

and

Independent Auditor’s Report

on Review of Interim Financial Information

Independent Auditor’s Report on Review of Interim Financial Information

To the Board of Directors of Do Day Dream Public Company Limited

I have reviewed the accompanying consolidated and separate statements of financial position of Do Day

Dream Public Company Limited and its subsidiaries, and of Do Day Dream Public Company Limited,

respectively, as at 31 March 2019; the consolidated and separate statements of comprehensive income,

changes in equity and cash flows for the three-month period ended 31 March 2019; and condensed notes

(“interim financial information”). Management is responsible for the preparation and presentation of this

interim financial information in accordance with Thai Accounting Standard 34, “Interim Financial Reporting”.

My responsibility is to express a conclusion on this interim financial information based on my review.

Scope of Review

I conducted my review in accordance with the Thai Standard on Review Engagements 2410, “Review of

Interim Financial Information Performed by the Independent Auditor of the Entity”. A review of interim

financial information consists of making inquiries, primarily of persons responsible for financial and

accounting matters, and applying analytical and other review procedures. A review is substantially less in

scope than an audit conducted in accordance with Thai Standards on Auditing and consequently does not

enable me to obtain assurance that I would become aware of all significant matters that might be identified in

an audit. Accordingly, I do not express an audit opinion.

Conclusion

Based on my review, nothing has come to my attention that causes me to believe that the accompanying

interim financial information is not prepared, in all material respects, in accordance with Thai Accounting

Standard 34, “Interim Financial Reporting”.

(Veerachai Ratanajaratkul)

Certified Public Accountant

Registration No. 4323

KPMG Phoomchai Audit Ltd.

Bangkok

10 May 2019

Do Day Dream Public Company Limited and its Subsidiaries

Statement of financial position

31 March 31 December 31 March 31 December

Assets Note 2019 2018 2019 2018

(Unaudited) (Unaudited)

Current assets

Cash and cash equivalents 5 1,212,311 1,774,482 915,900 1,484,274

Current investments 6 2,903,015 2,399,564 2,903,015 2,399,564

Trade accounts receivable and other receivables 4,7 249,097 265,890 208,022 209,572

Short-term loan to subsidiaries - - 110,000 100,000

Inventories 8 397,719 391,583 347,979 359,180

Other current assets 5,482 5,104 1,991 2,705

Total current assets 4,767,624 4,836,623 4,486,907 4,555,295

Non-current assets

Investments in subsidiaries 9 - - 201,030 201,030

Property, plant and equipment 266,805 274,221 265,825 273,248

Intangible assets 108,238 108,829 15,994 16,598

Restricted deposits at financial

institutions 11 20,273 20,273 20,273 20,273

Deferred tax assets 10,127 6,534 2,151 2,183

Other non-current assets 1,738 1,723 26 26

Total non-current assets 407,181 411,580 505,299 513,358

Total assets 5,174,805 5,248,203 4,992,206 5,068,653

statements statements

(in thousand Baht)

Consolidated financial Separate financial

The accompanying notes are an integral part of these financial statements.

2




Liabilities and equity Note 2019 2018 2019 2018


Current liabilities

Trade accounts payable and other payables 4, 12 146,308 156,900 41,942 52,880

Current portion of long-term loans

from financial institutions 11 - 29,492 - 29,492

Current portion of liabilities under

hire purchase and finance lease liabilities 11 740 993 740 993

Current tax payable 13,403 4,229 5,382 1,663

Other current liabilities 5,526 2,854 3,286 1,081

Total current liabilities 165,977 194,468 51,350 86,109

Non-current liabilities

Long-term loans from financial institutions 11 - 61,705 - 61,705

Liabilities under hire purchase and

finance lease liabilities 11 2,114 2,214 2,114 2,214

Non-current provisions for employee benefit 8,012 7,096 6,756 5,985

Total non-current liabilities 10,126 71,015 8,870 69,904

Total liabilities 176,103 265,483 60,220 156,013


(in thousand Baht)



3




Liabilities and equity (Continued) Note 2019 2018 2019 2018


Equity

Share capital

Authorised share capital 13 318,000 318,000 318,000 318,000

Issued and paid-up share capital 317,888 317,888 317,888 317,888

Share premium

Share premium on ordinary shares 4,399,860 4,399,860 4,399,860 4,399,860

Deficit on change in the ownership interests

in subsidiary (31,837) (31,837) - -

Retained earnings

Appropriated

Legal reserve 31,800 31,800 31,800 31,800

Unappropriated 256,475 237,541 182,438 163,092

Other components of equity (845) 1,997 - -

Equity attributable to owners of the parent 4,973,341 4,957,249 4,931,986 4,912,640

Non-controlling interests 25,361 25,471 - -

Total equity 4,998,702 4,982,720 4,931,986 4,912,640

Total liabilities and equity 5,174,805 5,248,203 4,992,206 5,068,653

(in thousand Baht)




4


Statement of comprehensive income (Unaudited)

Note 2019 2018 2019 2018

Revenue

Revenue from sale of goods 15 202,233 374,352 106,994 254,103

Other income 15,231 12,313 18,158 14,005

Total revenue 217,464 386,665 125,152 268,108

Expenses

Cost of sales of goods 54,038 100,977 62,789 143,188

Distribution costs 97,105 119,590 3,339 13,546

Administrative expenses 40,139 34,112 35,278 30,691

Finance costs 514 3,255 514 3,255

Total expenses 191,796 257,934 101,920 190,680

Profit before income tax expense 25,668 128,731 23,232 77,428

Tax expense 6,326 16,592 3,886 14,807

Profit for the period 19,342 112,139 19,346 62,621

Other comprehensive income

Items that will be reclassified

subsequently to profit or loss

Exchange differences on translating

foreign operations (3,360) (2,073) - -

Total items that will be reclassified

subsequently to profit or loss (3,360) (2,073) - -

Total comprehensive income for the period 15,982 110,066 19,346 62,621



Three-month period ended Three-month period ended

31 March 31 March

(in thousand Baht)


5


Statement of comprehensive income (Unaudited)

Note 2019 2018 2019 2018

Profit attributable to:

Owners of the parent 18,934 112,152 19,346 62,621

Non-controlling interests 408 (13) - -


Total comprehensive income

attributable to:

Owners of the parent 16,092 110,079 19,346 62,621

Non-controlling interests (110) (13) - -

Total comprehensive income

for the period 15,982 110,066 19,346 62,621

Basic earnings per share (in Baht) 16 0.06 0.35 0.06 0.20

Diluted earnings per share (in Baht) 16 0.06 0.35 0.06 0.20


Three-month period ended

31 March 31 March

(in thousand Baht)


Three-month period ended


6


Statement of changes in equity (Unaudited)

Other components

Dificit

Capital reserve on changes in Equity

Issued and for share-based the ownership Translating attributable to Non-

paid-up Share payment interests Legal foreign owners of controlling Total

Note share capital premium transactions in subsidiary reserve Unappropriated operations the parent interests equity

Three-month period ended 31 March 2018

Balance as at 1 January 2018 316,000 4,347,915 117 (31,836) 31,800 122,492 - 4,786,488 - 4,786,488

Transactions with owners,

recorded directly in equity

Contributions by owners of the parent

Share-based payment transactions 14 - - 59 - - - - 59 - 59

Total contributions by owners of the parent - - 59 - - - - 59 - 59

Changes in ownership interests in subsidiaries

Increase in non-controlling interests

from set up a new subsidiary - - - - - - - - 2,500 2,500

Total changes in ownership interests

in subsidiary - - - - - - - - 2,500 2,500

Total transactions with owners,

recorded directly in equity - - 59 - - - - 59 2,500 2,559

Comprehensive income for the period

Profit (loss) - - - - - 112,152 - 112,152 (13) 112,139

Other comprehensive income - - - - - - (2,073) (2,073) - (2,073)

Total comprehensive income for the period - - - - - 112,152 (2,073) 110,079 (13) 110,066

Balance at 31 March 2018 316,000 4,347,915 176 (31,836) 31,800 234,644 (2,073) 4,896,626 2,487 4,899,113

Consolidated financial statements

Retained earnings of equity

(in thousand Baht)

The accompanying notes are an integral part of the financial statements.7



Other components

Dificit

Capital reserve on changes in Equity

Issued and for share-based the ownership Translating attributable to Non-

paid-up Share payment interests Legal foreign owners of controlling Total

share capital premium transactions in subsidiary reserve Unappropriated operations the parent interests equity


Balance as at 1 January 2019 317,888 4,399,860 - (31,837) 31,800 237,541 1,997 4,957,249 25,471 4,982,720


Profit - - - - - 18,934 - 18,934 408 19,342

Other comprehensive income - - - - - - (2,842) (2,842) (518) (3,360)

Total comprehensive income for the period - - - - - 18,934 (2,842) 16,092 (110) 15,982

Balance at 31 March 2019 317,888 4,399,860 - (31,837) 31,800 256,475 (845) 4,973,341 25,361 4,998,702

(in thousand Baht)

Retained earnings


of equity




Capital reserve

Issued and for share-based

paid-up Share payment Legal Total

Note share capital premium transactions reserve Unappropriated equity


Balance as at 1 January 2018 316,000 4,347,915 117 31,800 69,345 4,765,177

Transactions with owners,

recorded directly in equity

Contributions by owners

Share-based payment transactions 14 - - 59 - - 59

Total transactions with owners,

recorded directly in equity - - 59 - - 59


Profit - - - - 62,621 62,621

Total comprehensive income for the period - - - - 62,621 62,621

Balance at 31 March 2018 316,000 4,347,915 176 31,800 131,966 4,827,857

Separate financial statements

Retained earnings

(in thousand Baht)




Capital reserve

Issued and for share-based

paid-up Share payment Legal Total

share capital premium transactions reserve Unappropriated equity


Balance as at 1 January 2019 317,888 4,399,860 - 31,800 163,092 4,912,640


Profit - - - - 19,346 19,346

Total comprehensive income for the period - - - - 19,346 19,346

Balance at 31 March 2019 317,888 4,399,860 - 31,800 182,438 4,931,986

(in thousand Baht)

Retained earnings




Statement of cash flows (Unaudited)

2019 2018 2019 2018

Cash flows from operating activities


Adjustments to reconcile profit to

cash receipts (payments)

Tax expense 6,326 16,592 3,886 14,807

Finance costs 514 3,255 514 3,255

Depreciation and amortization 8,803 7,661 8,688 7,579

Provisions for employee benefits 916 730 772 618

Unrealised (gain) loss on exchange 11 (30) (14) (96)

Share-based payment - 59 - 59

Gains on fair value adjustment (4,126) - (4,126) -

Gain on disposal of current investments (2,096) - (2,096) -

(Reversal of) bad and doubtful debts expenses (808) 133 (273) -

(Reversal of) losses on inventories devaluation 2,942 (844) 2,801 (1,090)

Interest income (5,542) (9,900) (9,396) (9,900)

26,282 129,795 20,102 77,853

Changes in operating assets and liabilities

Trade accounts receivable and other receivables 15,581 13,362 3,819 25,306

Inventories (9,078) (80,139) 8,400 (56,136)

Other current assets (378) (1,551) 713 2,459

Other non-current assets (15) 9 - 18

Trade accounts payable and other payables (9,909) (50,311) (10,091) (109,836)

Other current liabilities 2,672 4,723 2,205 3,846

Net cash generated from (used in) operating 25,155 15,888 25,148 (56,490)

Taxes paid (696) (1,197) (136) (206)

Net cash from (used in) operating activities 24,459 14,691 25,012 (56,696)




31 March 31 March

(in thousand Baht)


11


Statement of cash flows (Unaudited)

2019 2018 2019 2018

Cash flows from investing activities

Changes in restricted deposits at financial

institutions - 15,000 - 15,000

Acquisition of investment in subsidiaries - - - (122,500)

Proceeds from change in non-controlling interest - 2,500 - -

Acquisition of current investments (1,346,633) (200,000) (1,346,633) (200,000)

Proceeds from sale of current investments 849,405 - 849,405 -

Acquisition of property, plant and equipment (1,452) (5,254) (1,342) (5,190)

Acquisition of intangible assets (24) (741) - (708)

Short-term loan to a subsidiary - - (10,000) -

Interest received 7,468 424 7,468 424

Net cash used in investing activities (491,236) (188,071) (501,102) (312,974)

Cash flows from financing activities

Repayment of short-term loans - (33,346) - (33,346)

Proceeds from long-term loans - 49,900 - 49,900

Repayment of long-term loans (91,197) (6,109) (91,197) (6,109)

Payment by a lessee for reduction of the outstanding

liability relating to a finance lease (396) (417) (396) (417)

Interest paid (691) (3,166) (691) (3,166)

Net cash from (used in) financing activities (92,284) 6,862 (92,284) 6,862

Net decrease in cash and cash equivalents,

before effect of exchange rates (559,061) (166,518) (568,374) (362,808)

Effect of exchange rate changes on cash and cash equivalents (3,110) (2,073) - -

Net decrease in cash and cash equivalents (562,171) (168,591) (568,374) (362,808)

Cash and cash equivalents at 1 January 1,774,482 4,388,519 1,484,274 4,338,834

Cash and cash equivalents at 31 March 1,212,311 4,219,928 915,900 3,976,026

Supplemental disclosures of cash flows information:

Property, plant and epuipment acquired during

the three-month periods ended 31 March 2019 and 2018

are detailed as follows:

Increase in property, plant and equipment during the period 771 2,589 661 2,521

Change in payables on acquisition of plant and equipment 681 2,665 681 2,669

Net acquisition of property, plant and equipment

paid by cash 1,452 5,254 1,342 5,190


31 March 31 March

(in thousand Baht)




12

Do Day Dream Public Company Limited and its subsidiaries Notes to the interim financial statements

For the three-month period ended 31 March 2019 (Unaudited)

13

Note Contents

1 General information

2 Basis of preparation of the interim financial statements

3 Change in accounting policy

4 Related parties

5 Cash and cash equivalents

6 Current Investments

7 Trade accounts receivable and other receivables

8 Inventories

9 Investment in subsidiaries

10 Property, plant and equipment

11 Interest-bearing liabilities

12 Trade accounts payable and other payables

13 Share capital

14 Employee Stock Option Plan (ESOP)

15 Revenue and segment information

16 Earnings per share

17 Financial instruments

18 Commitments with non-related parties

19 Event after the reporting period

20 Thai Financial Reporting Standards (TFRS) not yet adopted

Do Day Dream Public Company Limited and its Subsidiaries Notes to the interim financial statements


14

These notes form an integral part of the interim financial statements.

The interim financial statements issued for Thai regulatory reporting purposes are prepared in the Thai

language. These English language financial statements have been prepared from the Thai language

financial statements, and were approved and authorised for issue by the Board of Directors on

10 May 2019.

1 General information

Do Day Dream Public Company Limited (“the Company”), is incorporated in Thailand and has its

registered office at 32 Keharomklao road, Kwang Ratphatthana, Khet Saphansung, Bangkok 10240,

Thailand.

The Company was listed on the Stock Exchange of Thailand on 26 December 2017.

The Company’s major shareholder during the financial period was Mr. Sarawut Pornpatanarak

(56.50% shareholding)

The principal businesses of the Company and its subsidiaries (together referred to the “Group”) are

manufacturing and distributing cosmetic.

Details of the Company’s subsidiaries as at 31 March 2019 and 31 December 2018 are given in note 9

to the interim financial statements.

2 Basis of preparation of the interim financial statements

(a) Statement of compliance

The interim financial statements are prepared on a condensed basis in accordance with Thai Accounting

Standard (TAS) No. 34 (revised 2018) Interim Financial Reporting; guidelines promulgated by the

Federation of Accounting Professions and applicable rules and regulations of the Thai Securities and

Exchange Commission.

The interim financial statements are prepared to provide an update on the financial statements for the

year ended 31 December 2018. They do not include all of the financial information required for full

annual financial statements but focus on new activities, events and circumstances to avoid repetition of

information previously reported. Accordingly, these interim financial statements should be read in

conjunction with the financial statements of the Company and its subsidiaries for the year ended

31 December 2018.

The accounting policies and methods of computation applied in these interim financial statements are

consistent with those applied in the financial statements for the year ended 31 December 2018 except

that the Group has adopted all the new and revised TFRS that are effective for annual periods beginning

on or after 1 January 2019.

The effects of these change in accounting policy, where such effects are considered material to the

financial statements, are disclosed in note 3.

For a number of new and revised TFRS which are not yet effective for current period, the Group has not

early adopted these standards in preparing these interim financial statements before the effective date.

Those new and revised TFRS that are relevant to the Group’s operations are disclosed in note 20.



15

(b) Functional and presentation currency

The interim financial statements are presented in Thai Baht, which is the Company’s functional

currency. All financial information presented in Thai Baht has been rounded to the nearest thousand

unless otherwise stated.

(c) Use of judgements and estimates

The preparation of interim financial statements in conformity with TFRS requires management to make

judgements, estimates and assumptions that affect the application of accounting policies and the reported

amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.

In preparing these interim financial statements, the significant judgements made by management in

applying the Group’s accounting policies and the key sources of estimation uncertainty were the same

as those that applied to the financial statements for the year ended 31 December 2018, except for revenue

recognition which requires judgement in determining the timing of the transfer of control - at a point in

time or over time - according to the requirements of TFRS 15 which the Group has initially adopted as

disclosed in note 3.

Measurement of fair values

The Group has an established control framework with respect to the measurement of fair values. This

includes a valuation team that has overall responsibility for overseeing all significant fair value

measurements, including Level 3 fair values, and reports directly to the chief financial officer.

The valuation team regularly reviews significant unobservable inputs and valuation adjustments. If third

party information, such as broker quotes or pricing services, is used to measure fair values, then the

valuation team assesses the evidence obtained from the third parties to support the conclusion that these

valuations meet the requirements of TFRS, including the level in the fair value hierarchy in which the

valuations should be classified.

Significant valuation issues are reported to the Group’s Audit Committee.

When measuring the fair value of an asset or a liability, the Group uses observable market data as far as

possible. Fair values are categorised into different levels in a fair value hierarchy based on the inputs

used in the valuation techniques as follows:

• Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.

• Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or

liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

• Level 3: inputs for the asset or liability that are not based on observable market data (unobservable

inputs).

If the inputs used to measure the fair value of an asset or liability might be categorised in different levels

of the fair value hierarchy, then the fair value measurement is categorised in its entirety in the same

level of the fair value hierarchy as the lowest level input that is significant to the entire measurement.

The Group recognises transfers between levels of the fair value hierarchy at the end of the reporting

period during which the change has occurred.

Further information about the assumptions made in measuring fair values is included in note 17 -

financial instruments.



16

3 Change in accounting policy

The Group has initially applied TFRS 15 Revenue from Contracts with Customers (“TFRS 15”) from 1

January 2019. TFRS 15 establishes a comprehensive framework for determining how much and when

revenue is recognised. It replaced TAS 18 Revenue (“TAS 18”), TAS 11 Construction Contracts (“TAS

11”) and related interpretations.

Under TFRS 15, the Group recognises revenue when a customer obtains control of the goods or services

in an amount that reflects the consideration to which the Group expects to be entitled to. In addition,

judgement is required in determining the timing of the transfer of control for revenue recognition - at a

point in time or over time. Whereas, under TAS 18, the Group recognises revenue from sale of goods

when the significant risks and rewards of ownership of the goods have been transferred to the buyer,

and recognises revenue from rendering of services by reference to the stage of completion of the

transaction at the end of the reporting period. No revenue is recognised if there is continuing

management involvement with the goods or there are significant uncertainties regarding recovery of the

consideration due.

The Group has adopted TFRS 15 using the cumulative effect method, with the effect of initially applying

this standard recognised at the date of initial application (1 January 2019). Accordingly, the Group has

not restated the information presented for 2018 and presented them as previously reported, under TAS

18, TAS 11 and related interpretations. Additionally, the disclosure requirements under TFRS 15 have

not been applied to comparative information.

The detail and quantitative impact of the change in accounting policy are disclosed as follows:

a. Principal and agent consideration

The Group entered into a contract with a customer on delivery of goods to the end customers on

behalf of the said customer. Under TAS 18, the Group assessed that the customer has significant

risks and rewards of ownership of the goods based on credit risk. Then the Group recognised

revenue from sales at a contract price, net of commission paid to the said customer when transferring

the goods to the end customers. Under TFRS 15, the Group assessed whether the said customer has

control over the goods before transferring them to the end customers. The Group determined that

the customer has no control over the goods before transferring them to the end customer. Therefore,

the intermediate customer acts as the Group’s agent to sell the said goods to the end customers. As

a result, the Group recognises revenue at stand-alone selling price and commission paid to the

intermediate customer as expense.

b. Payment to a customer

The Group makes payments to its retailers for product placement (“slotting fees”), promotion events

or advertising. Under TAS 18, the Group recognised such amounts as distribution costs. Under

TFRS 15, it is required that the Group will consider whether the Group receives distinct goods or

services from the customer. If so, then the Group recognises such payments as an expense when the

distinct goods or services are consumed. In contrast, if not, such payments are recognised as a

reduction of revenue. If the payment exceeds the fair value of the goods or services received, then

the excess is recognised as a reduction of revenue. As a result, this results in decreases in revenue

and distribution costs.

TFRS 15 did not have any material impact on the Group’s accounting policies with respect to other

revenue streams.



17

The following tables summarise the impacts of initial application of TFRS 15 on the consolidated and separate financial statements.

Consolidated financial statements Separate financial statements

Statement of comprehensive income

for the three-month period ended

31 March 2019

Note

Amounts

as reported

Adjustments

Amounts

without

adoption of

TFRS 15

Amounts

as reported

Adjustments

Amounts

without

adoption of

TFRS 15

(in thousand Baht)

Continuing operations

Revenue from sale of goods b 202,233 11,560 213,793 106,994 - 106,994

Other income 15,231 - 15,231 18,158 - 18,158

Costs of sales of goods 54,038 - 54,038 62,789 - 62,789

Distribution costs b 97,105 11,560 108,665 3,339 - 3,339

Administrative expenses 40,139 - 40,139 35,278 - 35,278

Finance costs 514 - 514 514 - 514

Profit before income tax expense

from continuing operations 25,668 - 25,668 23,232 - 23,232

Tax expense 6,326 - 6,326 3,886 - 3,886

Profit for the period 19,342 - 19,342 19,346 - 19,346

Total comprehensive income for the period 15,982 - 15,982 19,346 - 19,346

Basic earnings per share (in Baht)

Basic earnings per share from continuing

operations

0.06

-

0.06

0.06

-

0.06

Diluted earnings per share (in Baht)

Diluted earnings per share from continuing

operations

0.06

-

0.06

0.06

-

0.06

There is no material impacts on the consolidated and separate statement of cash flows for the three-month period ended 31 March 2019 from the adoption of

TFRS 15.



18

4 Related parties

For the purposes of these financial statements, parties are considered to be related to the Group if the

Group has the ability, directly or indirectly, to control or joint control the party or exercise significant

influence over the party in making financial and operating decisions, or vice versa, or where the Group

and the party are subject to common control or common significant influence. Related parties may be

individuals or other entities.

Relationships with subsidiaries are described in notes 9 to the interim financial statements. Relationship

with key management and other related parties were as follows:

Name of parties

Country of

incorporation/

nationality Nature of relationships

Mr.Sarawut Pornpatanarak Thai Persons having authority and responsibility for

planning, directing and controlling the

activities of the group, directly or indirectly,

including major shareholder and director of

the Group

PM Chemical Company Limited Thailand Shared directors and share holders

The Fourteen Company Limited Thailand Related by director

Nama Nama Group Company

Limited

Thailand Shared directors and share holders

Key management personnel Thai Persons having authority and responsibility for

planning, directing and controlling the

activities of the entity, directly or indirectly,

including any director (whether executive or

otherwise) of the Group

The pricing policies for of transactions with related parties are explained further below:

Transactions Pricing policies

Sales of goods, net of discount Market price net discount

Rental income Agreed rate as stipulated in the agreement

Transportation fee income Agreed rate at a percentage of total purchase

Management fee income Agreed rate as stipulated in the agreement at a

percentage of total sales.

Interest income Fixed deposit rate

Dividend income Right to receive dividends

Purchase of merchandise goods Market price net discount

Sale promotion expense Agreed rate as stipulated in the agreement



19

4.1 Significant transactions for the three-month period ended 31 March with related parties were as

follows:

Consolidated Separate

financial statements financial statements

For the three-month period ended

31 March 2019 2018 2019 2018

(in thousand Baht)

Subsidiaries

Sales of goods, net of discount - - 106,994 160,595

Rental income - - 125 81

Management fee income - - 2,006 2,146

Interest income - - 686 -

Other related parties

Sales of goods, net of discount 17,248 72,463 - -

Purchases of goods 361 683 361 683

Purchases of equipment - - - -

Sales promotion expense 2,374 10,387 - -

Rental fee expense 135 345 135 -

Insurance expense - 38 - 38

Entertainment expense 9 1 9 1

Key management personnel

Key management benefit expenses

Short-term employee benefits 15,694 20,478 15,694 18,459

Post-employment benefits 337 280 270 204

Total key management benefit

expenses

16,031

20,758

15,964

18,663

4.2 Balances as at 31 March 2019 and 31 December 2018 with related parties were as follows:

Trade accounts receivable and other

receivable- related parties

Consolidated

financial statements

Separate


31

March

2019

31

December

2018

31

March

2019

31

December

2018

(in thousand Baht)

Subsidiaries - - 186,844 185,971

Related companies 6,010 5,310 - -

Total 6,010 5,310 186,844 185,971



20

Short-term loan to subsidiaries

Consolidated


Separate


31

March

2019

31

December

2018

31

March

2019

31

December

2018

(in thousand Baht)

Dream Dermatology Company Limited - - 100,000 100,000

Skin Make Smiles Company Limited - - 10,000 -

Total - - 110,000 100,000

Movements during the three-month period ended 31 March of loans to subsidiaries were as follows:

Consolidated


Separate


2019 2018 2019 2018

(in thousand Baht)

At 1 January - - 100,000 -

Increase - - 10,000 -

At 31 March - - 110,000 -

At 31 December - 100,000

As at 31 March 2019, short-term loan to subsidiaries were unsecured and at call, and bore interest at

the rate 1.90% per annum (31 December 2018: 4.25% per annum).

Trade accounts payable and other

payables - related parties

Consolidated


Separate


31

March

2019

31

December

2018

31

March

2019

31

December

2018

(in thousand Baht)

Subsidiaries - - 52 -

Related companies 1,126 1,167 346 64

Total 1,126 1,167 398 64

4.3 Significant agreements with related parties

As at 31 March 2019, the Group had the following significant agreements with related parties.

a.) The Company has service agreement with Namu Life Plus Company Limited (a subsidiary).

Under the terms of the agreement, the Company agreed to provide the service of consulting and

management. In this regard, the subsidiary agreed to pay monthly fee to the Company at the rate

as stipulated in the agreement.

b.) The Company has service agreement with Do Infinite Dream Company Limited (a subsidiary).






21

c.) The Company has service agreement with Dream Dermatology Company Limited (a subsidiary).




d.) The Company has office rental agreement with Namu Life Plus Company Limited (a subsidiary).

Under the term of the agreement, the Company agreed the subsidiary to use the building space

for their office. In this regards, the subsidiary agreed to pay rental fee to the Company at the rate

stipulated in the agreement.

e.) The Company has office rental agreement with Do Infinite Dream Company Limited (a subsidiary).




f.) The Company has office rental agreement with Dream Dermatology Company Limited (a subsidiary).




g.) The Company has office rental agreement with Skin Make Smiles Company Limited (a subsidiary).




h.) The Company has service agreement with Do Day Dream Trading Pte. Ltd. (a foreign indirect

subsidiary). Under the terms of the agreement, the Company agreed to provide the accounting

receivable management service and capital management service. In this regard, the foreign indirect

subsidiaries agreed to pay monthly fee to the Company at the rate of 0.1 percent of the total net sales. This agreement is terminated by mutually agreed by both parties in writing or either party upon receipt

of 30 days prior written notice in the event the other party materially fails to comply with the terms of

agreement through no fault of the other.

5 Cash and cash equivalents

Consolidated


Separate


31

March

2019

31

December

2018

31

March

2019

31

December

2018

(in thousand Baht)

Cash on hand 76 87 29 26

Cash at financial institutions

- current accounts 123,915 115,250 7,582 11,526

Cash at financial institutions

- savings accounts 885,338 856,162 705,307 669,739

Highly liquid short-term investments 202,982 802,983 202,982 802,983

Total 1,212,311 1,774,482 915,900 1,484,274

As at 31 March 2019, deposits in savings accounts and fixed deposit carried interests of 0.1% - 1.9%

per annum (31 December 2018: 0.1% - 1.9% per annum).



22

6 Current investments

Consolidated


Separate


31

March

2019

31

December

2018

31

March

2019

31

December

2018

(in thousand Baht)

Current investments

Short-term deposits at financial institutions 750,001 900,001 750,001 900,001

Equity securities held for trading 1,255,886 1,101,760 1,255,886 1,101,760

Other debt securities held to maturity 897,128 397,803 897,128 397,803

Total 2,903,015 2,399,564 2,903,015 2,399,564

As at 31 March 2019, Short-term deposits at financial institutions, with a carrying amount of Baht 750

million (31 December 2018: Baht 900 million) have annual interest rates of from 1.70% to 1.90%

(31 December 2018: 1.45% to 1.90%) and mature within 1 year. Held-to-maturity investments have

interest rates of 1.82% to 1.95% (31 December 2018: 1.82% to 1.83%) and mature within 1 year.

Movements during the three-month periods ended 31 March of marketable equity and debt securities

were as follows:

Consolidated


Separate


2019 2018 2019 2018

(in thousand Baht)

Current investments

Trading securities

At 1 January 1,101,760 - 1,101,760 -

Purchases during the period 650,000 - 650,000 -

Sales during the period (500,000) - (500,000) -

Valuation adjustment 4,126 - 4,126 -

At 31 March 1,255,886 - 1,255,886 -

At 31 December 1,101,760 1,101,760

7 Trade accounts receivable and other receivables

Consolidated


Separate


Note

31

March

2019

31

December

2018

31

March

2019

31

December

2018

(in thousand Baht)

Trade accounts receivable

Related parties 4 6,010 5,310 180,123 179,112

Other parties 204,914 219,817 8,840 10,332

Total 210,924 225,127 188,963 189,444

Less allowance for doubtful accounts (364) (1,173) (91) (364)

Net 210,560 223,954 188,872 189,080



23

Consolidated


Separate


Note

31

March

2019

31

December

2018

31

March

2019

31

December

2018

(in thousand Baht)

Other receivables

Other receivables - related parties

Accrued income - - 4,231 3,582

Other receivables - - 2,490 3,277

Other receivables

- related parties, net

4 - - 6,721 6,859

Other receivables - other parties

Prepaid expenses 22,350 23,977 2,783 3,078

Accrued income 5,643 4,402 5,643 4,402

Other receivables 10,544 13,557 4,003 6,153

Other receivables

- other parties, net 38,537 41,936 12,429 13,633

Total other receivables - net 38,537 41,936 19,150 20,492

Total trade accounts receivable and

other receivables - net 249,097 265,890 208,022 209,572

Consolidated


Separate


2019 2018 2019 2018

(in thousand Baht)

Bad and doubtful debts expense

(reversal) for the three-month

period ended 31 March

(808)

133

(273)

-

Aging analyses for trade accounts receivable were as follows:

Consolidated


Separate


31

March

2019

31

December

2018

31

March

2019

31

December

2018

(in thousand Baht)

Trade account receivable

- related parties

Within credit terms 6,010 5,310 46,162 25,961

Overdue:

Less than 3 months - - 92,570 90,887

3-6 months - - 41,391 62,264

Total 6,010 5,310 180,123 179,112

Less allowance for doubtful accounts - - - -


- related parties, net 6,010 5,310 180,123 179,112



24

Consolidated


Separate


31

March

2019

31

December

2018

31

March

2019

31

December

2018

(in thousand Baht)

Trade account receivable

- other parties

Within credit terms 139,672 167,468 1,605 3,007

Overdue:

Less than 3 months 57,745 49,776 66 5,619

3-6 months - 1,703 - 1,699

6-12 months 7,232 75 7,157 -

Over 12 months 265 795 12 7

Total 204,914 219,817 8,840 10,332

Less allowance for doubtful accounts (364) (1,173) (91) (364)


- other parties, net 204,550 218,644 8,749 9,968

Total trade accounts receivable - net 210,560 223,954 188,872 189,080

The normal credit term granted by the Group ranges from 15 days to 180 days.

8 Inventories




2019 2018 2019 2018

(in thousand Baht)

Finished goods 148,382 142,574 99,845 110,239

Work in process 15,845 7,322 15,845 7,322

Raw materials 66,791 62,253 66,791 62,253

Packaging 169,882 179,796 168,027 179,053

Supplies 6,051 5,938 5,842 5,890

Total 406,951 397,883 356,350 364,757 Less allowance for obsolete (9,232) (6,300) (8,371) (5,577)

Net 397,719 391,583 347,979 359,180



25

9 Investments in subsidiaries

Separate


2019 2018

(in thousand Baht)

At 1 January 201,030 77,655

Acquisitions - 122,500

At 31 March 201,030 200,155

At 31 December 201,030

The detail of acquisitions of investments in subsidiaries during the period ended 31 March was as

follows:

Separate


For the three-month period ended 31 March 2019 2018

(in thousand Baht)

Dream Dermatology Company Limited - 47,500

Do Infinite Dream Company Limited - 75,000

Total - 122,500



26

Investments in subsidiaries as at 31 March 2019 and 31 December 2018, and dividend income from those investments for the three-month period ended 31 March

were as follows:


Name of subsidiaries

Type of business

Country of

incorporation

Ownership

interest

Paid-up capital

Cost

Dividend income

31

March

2019

31

December

2018

31

March

2019

31

December

2018

31

March

2019

31

December

2018

31

March

2019

31

March

2018

(%) (in thousand Baht)

Local direct subsidiaries

Namu Life Plus Company

Limited Distribution of cosmetic

and supplement

Thailand 100 100 5,000 5,000 52,655 52,655 - -

Do Infinite Dream

Company Limited Management, technical,

financing and

enterprise service

Thailand 100 100 100,000 100,000 100,000 100,000 - -

Dream Dermatology

Company Limited Distribution of cosmetic

and supplement

Thailand 95 95 50,000 50,000 47,500 47,500 - -

Skin Make Smiles

Company Limited Distribution of cosmetic Thailand 70 70 1,250 1,250 875 875 - -

Total 201,030 201,030 - -

Foreign Indirect subsidiaries

Do Day Dream Holding

Pte.Ltd. Holding company Singapore 100 100 USD 2,000,000 USD 2,000,000

Do Day Dream Trading

Pte.Ltd. General wholesale trade

(include general

importer and exporter)

Singapore 100 100 USD 300,000 USD 300,000

Do Day Dream Philippines

Corporation General wholesale trade

(include general

importer and exporter)

Philippines 51 51 PHP 66,000,000 PHP 66,000,000



27

10 Property, plant and equipment

Acquisitions, disposals and transfers of property, plant and equipment during the three-month period

ended 31 March were as follows:

As at 31 March 2019, the Group and the Company had vehicles which were acquired under finance lease

agreements and hire purchase agreements with net book value of Baht 5.58 million (31 December 2018:

Baht 6.31 million).

Security

As at 31 March 2019, the Company’s property, plant and equipment with total net book value of Baht

51.98 million (31 December 2018: Baht 52.17 million) were pledged under credit facilities from financial

institutions (Note 11).



31 March

2019

2018

Acquisitions

and

transfers in

- at cost

Disposals

and

transfers

out - net

book value

Acquisitions

and

transfers in

- at cost

Disposals

and

transfers

out - net

book value

(in thousand Baht)

Land - - - -

Buildings and building improvements - - 53 -

Machinery and equipment 10,474 (4) 7,016 (14)

Vehicles - - - -

Assets under construction and

installation

557

(10,242)

1,922

(6,388)

Total 11,031 (10,246) 8,991 (6,402)



31 March

2019

2018

Acquisitions

and

transfers in

- at cost

Disposals

and

transfers

out - net

book value

Acquisitions

and

transfers in

- at cost

Disposals

and

transfers

out - net

book value

(in thousand Baht)

Land - - - -

Buildings and building improvements - - 53 -

Machinery and equipment 10,346 (4) 6,948 (14)

Vehicles - - - -

Assets under construction and

installation

557

(10,242)

1,922

(6,388)

Total 10,903 (10,246) 8,923 (6,402)



28

11 Interest-bearing liabilities

Consolidated


Separate


31

March

2019

31

December

2018

31

March

2019

31

December

2018

(in thousand Baht)

Current

Current portion of long-term loans

from financial institutions - secured - 29,492 - 29,492

Current portion of finance lease

liabilities 740 993 740 993

Total current interest-bearing

liabilities 740 30,485 740 30,485

Non-current

Long-term loans from

financial institutions - secured - 61,705 - 61,705

Finance leases liabilities 2,114 2,214 2,114 2,214

Total non-current interest-bearing

liabilities

2,114

63,919

2,114

63,919

Total 2,854 94,404 2,854 94,404

Long-term loans from financial institutions

Movements during the three-month period ended 31 March were as follows:



2019 2018 2019 2018

(in thousand Baht)

At 1 January 91,197 68,194 91,197 68,194

Increases - 49,900 - 49,900

Decreases (91,197) (6,109) (91,197) (6,109)

At 31 March - 111,985 - 111,985

At 31 December 91,197 91,197



29

As at 31 March 2019 and 31 December 2018 the Company had secured long-term borrowing agreements

with financial institution. Detail were as follow:

Balance as at

Borrowing

agreements

Interest rate

31 March

2019

31 December

2018

Term of payment

(% per annum) (in million Baht)

The first 1st - 2nd year : MLR-2.00

From 3rd year : MLR-1.75

- 51 Principle with interest

for 48 months

Baht 1.45 million per month

The second 1st - 2nd year : MLR-2.00

From 3rd year : MLR-1.75

- 40 Principle with interest

for 72 months

Baht 0.89 million per month

As at 31 March 2019, fixed deposit, of Baht 20 million and parcels of land and other current and future

construction there on with a net book value of Baht 51.98 million were used as collateral for the

Company’s credit line from financial institutions.

Interest rates

Interest rates as at 31 March 2019 and 31 December 2018 were as follow:



31 March

2019

31 December

2018

31 March

2019

31 December

2018

(%)

Liabilities under trust receipt - 2.91 - 2.91

Long-term loans from financial

institutions

-

MLR-1.75,

MLR-2

-

MLR-1.75,

MLR-2

Finance leases liabilities 4.80 - 6.96 4.80 - 6.96 4.80 - 6.96 4.80 - 6.96

Credit facilities

As at 31 March 2019, the Company had unutilised credit facilities totaling of Baht 840 million. (31

December 2018: Baht 840 million).



30

12 Trade accounts payable and other payables

Consolidated


Separate


Note

31

March

2019

31

December

2018

31

March

2019

31

December

2018

(in thousand Baht)

Trade accounts payable

- related parties

4 346 45 346 45

Trade accounts payable

- other parties

33,029 59,291 26,970 33,368

Other payables - related parties 4 780 1,122 52 19

Other payables - other parties 112,153 96,442 14,574 19,448

Total 146,308 156,900 41,942 52,880

13 Share capital

14 Employee Stock Option Plan (ESOP)

On 17 July 2017, the Extraordinary General Meeting of the Company’s shareholders No. 2/2560

approved to allot 2,000,000 rights to purchase the Company’s share capital under the Employee Stock

Option Plan (ESOP) as follows:

Name of securities: Do Day Dream Public Company Limited

Category: Additional ordinary share capital

Type: Named share capital

Consolidated/Separate financial statements

2019 2018

Par value

per share

Number

of shares

Amount

Number

of shares

Amount

(in Baht) (thousand shares/thousand Baht)

Authorised

At 1 January

- ordinary shares 1 318,000 318,000 318,000 318,000

At 31 March

- ordinary shares 1 318,000 318,000 318,000 318,000

At 31 December

- ordinary shares 1 318,000 318,000

Issued and paid-up

At 1 January

- ordinary shares 1 317,888 317,888 316,000 316,000

At 31 March

- ordinary shares 1 317,888 317,888 316,000 316,000

At 31 December

- ordinary shares 1 317,888 317,888



31

Offering method: The Company will allot the additional ordinary share capital to the

directors, executives, and/or employees of the Company and/or its

subsidiaries under the Employee Stock Option Plan.

Term: 1 year after approved by the Company’s shareholders

No. of offered shares: 2,000,000 shares

Exercise price: Fair value as at the allotment date (Baht 28.42 per share)

Exercise period: The Company will sell the additional ordinary share capital within

1 year after approved by the Company’s shareholders under the

Employee Stock Option Plan, and 1 month after the share capital of

the Company has been registered on the Stock Exchange of Thailand.

The offering process will be completed within 17 July 2018.

The estimated fair value of each share option granted is Baht 0.0975, calculated using the Black-scholes

model.

During the three-month period ended 31 March 2018, the Company recognised expenses from this plan

amounting to Baht 0.06 million as personnel expenses, and as at 31 March 2018, the Company has the

balance of capital reserves for share-based payment amounting to Baht 0.18 million, presented in equity.

Unused shares option were expired in 2018.

15 Revenue and segment information

Revenue

The Group’s operations and main revenue streams are described in the last annual financial statements.

The Group’s main revenue is derived from sale of goods.

The nature and effect of initially applying TFRS 15 on the interim financial statements are disclosed in

Note 3.

Segment information

Management considers that the Group operates in a single line of business, namely the manufacture and distribution of cosmetic, and has, therefore, only one reportable segment.

Geographic information

Revenue from external customers is based on locations of the customers.

In the following table, revenue is disaggregated by primary geographical market and service lines and

timing of revenue recognition.


(in thousand Baht)

Primary geographical markets

Revenue from local sales 170,864 299,081

Revenue from export sales 31,369 75,271

Total 202,233 374,352



32


(in thousand Baht)

Timing of revenue recognition

At a point in time 202,233 374,352

Over time - -

Total 202,233 374,352

Profit from operation after intra-group elimination

and internal expense allocation 26,182 131,986

Finance costs (514) (3,255)

Income tax expense (6,326) (16,592)

Profit for the period 19,342 112,139

16 Earnings per share

Basic earnings per share

The calculations of basic earnings per share for the three-month periods ended 31 March 2019 and 2018

were based on the profit for the periods attributable to ordinary shareholders of the Company and the

weighted average number of ordinary shares outstanding during the periods as follows:

Consolidated


Separate



31 March 2019 2018 2019 2018

(in thousand Baht / thousand shares)

Profit for the period attributable

to equity holders of the Company 18,934 112,152 19,346 62,621

Weighted average number of ordinary

shares outstanding during the period 317,888 316,000 317,888 316,000

Earnings per share (in Baht) 0.06 0.35 0.06 0.20



33

Diluted earnings per share

The calculations of diluted earnings per share for the three-month periods ended 31 March 2019 and

2018 were based on the profit for the periods attributable to ordinary shareholders of the Company and

the weighted average number of ordinary shares outstanding during the periods after adjusting for the

effects of all dilutive potential ordinary shares as follows:

Consolidated


Separate



31 March 2019 2018 2019 2018

(in thousand Baht / thousand shares)

Profit for the period attributable

to equity holders of the Company

(basic) 18,934 112,152 19,346 62,621

Profit for the period attributable to

equity holders of the Company

(diluted) 18,934 112,152 19,346 62,621

Weighted average number of ordinary

shares outstanding (basic) 317,888 316,000 317,888 316,000

Effect of dilutive potential ordinary shares - 1,440 - 1,440

Weighted average number of

ordinary shares outstanding (diluted) 317,888 317,440 317,888 317,440

Earnings per share (diluted) (in Baht) 0.06 0.35 0.06 0.20

17 Financial instruments

Carrying amount and fair values

The following table shows the carrying amounts and fair values of financial assets and financial

liabilities, including their levels in the fair value hierarchy. It does not include fair value information for

financial assets and financial liabilities not measured at fair value if the carrying amount is a reasonable

approximation of fair value.

Consolidated/ Separate financial statements

Carrying Fair value

amount Level 1 Level 2 Level 3 Total

(in million Baht)

31 March 2019

Financial assets and financial

liabilities measured at fair value

Debt securities held for trading 1,256 - 1,256 - 1,256



34

Consolidated/ Separate financial statements

Carrying Fair value

amount Level 1 Level 2 Level 3 Total

(in million Baht)

31 December 2018

Financial assets and financial

liabilities measured at fair value

Debt securities held for trading 1,102 - 1,102 - 1,102

Fair value of financial assets and liabilities

Most of financial assets and liabilities of the Group were short-term. The fair value of financial assets

and liabilities are taken to approximate the carrying value as determined in the statement of financial

position.

The fair value of long-term loans and financial lease liabilities are taken to approximate the carrying

value because most of these financial instruments bear interest at market rate.

The Group has considered the level 2 fair value of debt securities held for trading based on net asset

value as at the measurement date according to the fund’s information released to the public.

18 Commitments with non-related parties

Capital commitments

Consolidated


Separate


31

March

2019

31

December

2018

31

March

2019

31

December

2018

(in thousand Baht)

Machinery and equipment 307 307 307 307

Total 307 307 307 307

Future minimum lease payments under non-cancellable operating leases

Consolidated


Separate


31

March

2019

31

December

2018

31

March

2019

31

December

2018

(in thousand Baht)

Within one year 11,329 7,741 5,763 2,272

After one year but within five years 7,404 8,908 396 532

Total 18,733 16,649 6,159 2,804



35

Guarantee

As at 31 March 2019, there was outstanding bank guarantee of approximately Baht 0.27 million

(31 December 2018: Baht 0.27 million) issued by bank on behalf of the Company in respect of guarantee

electricity use.

19 Event after the reporting period

At the annual general meeting of Shareholders of the Company held on 24 April 2019, the shareholders

approved the appropriation of dividends from the 2018 operations of Baht 0.5 per share, amounting to

Baht 158.94 million. The dividends will be paid to the shareholders in May 2019.

20 Thai Financial Reporting Standards (TFRS) not yet adopted

A number of new and revised TFRS which are relevant to the Group’s operations are expected to have

significant impact on the Company’s financial statements on the date of initial application. Those TFRS

which become effective for annual financial reporting periods beginning on or after 1 January 2020 are

as follows:

TFRS Topic

TFRS 7* Financial Instruments: Disclosures TFRS 9* Financial Instruments TFRS 16 Leases TAS 32* Financial Instruments: Presentation TFRIC 16* Hedges of a Net Investment in a Foreign Operation TFRIC 19* Extinguishing Financial Liabilities with Equity Instruments * TFRS - Financial instruments standards

(a) TFRS - Financial instruments standards

These TFRSs establish requirements related to definition, recognition, measurement, impairment

and derecognition of financial assets and financial liabilities, including accounting for derivatives

and hedge accounting.

Management is presently considering the potential impact of adopting and initially applying TFRS

- Financial instruments standards on the consolidated and separate financial statements.

(b) TFRS 16 Leases

TFRS 16 introduces a single lessee accounting model for lessees. A lessee recognises a right-of-

use asset representing its right to use the underlying asset and a lease liability representing its

obligation to make lease payments. There are recognition exemptions for short-term leases and

leases of low-value items. Lessor accounting remains similar to the current standard, i.e. lessors

continue to classify leases as finance or operating leases.

Management is presently considering the potential impact of adopting and initially applying TFRS

16 on the consolidated and separate financial statements.

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