untitled art 1 - listed companydtac.listedcompany.com/misc/ar/ar2001_eng.pdf · particular,...

2001 annual reportTotal Access Communicat ion Plc.

333/3 Chai Bui ld ing, V ibhavadi Rangsi t Road, Chatuchak, Bangkok 10900

Tel . 0-266-2202-8000 Fax: 0-266-2202-8102-4

www.DTAC.co.th

An

nu

al R

ep

ort 2

00

1 T

ota

l Ac

ce

ss

Co

mm

un

ica

tion

Pu

blic

Co

mp

an

y Lim

ited

Vision & Mission 1

Message from Chairman and CEO 2

Board of Directors 4

Corporate Governance 6

Organization Chart 10

Executive Management 12

Highlight in 2001 14

Operational Review 15

Key Figures 17

Financial Review 18

Risk Factors 22

Wireless Industry in Thailand 24

The DTAC Story 26

DTAC and the Community 34

Shareholder Structure 36

Information for Shareholders 40

Directors Report 41

Audit Committee Report 44

Financial Statements 45

contents

“easy”

Tota

l A

cc

es

s C

om

mu

nic

ati

on

Plc

.

an

nu

al

rep

ort

20

01

Vision & MissionTotal Access Communicat ion Plc .

a n n u a l r e p o r t 2 0 0 1Total Access Communication Plc. 01

V i s i o nDTAC will be Thailand's telecommunications service company of choice, meeting the

needs for communication and interaction among the people, businesses and

communities that we serve.

M i s s i o nTo be a world class telecommunication company which;

•understands customer needs and provides innovative and effective solutions on a timely basis

•provides a challenging and rewarding work environment where employees flourish

• is trusted by all our stakeholders

Message from

Message from our Chairman and CEO

2001 was a transitional year for our company. The year started with the successful launch of the much-

acclaimed brand name "DTAC". A primary purpose of this exercise was to consolidate a variety of brand

names into one. But more importantly, the new "DTAC" was to herald a new way of doing business for our

customers and to develop an association with the core attributes of our brand. "Make It Easy" is our

guiding principal in developing a customer relationship based on trust, fairness and transparency which

together represent the promise of "DTAC".

Chairman and CEOTotal Access Communicat ion Plc .

Mr. Boonchai BencharongkulChairman and Chief Executive Officer

In order to support this promise, we have invested heavily in our network to significantly increase the

areas of population covered throughout Thailand. We have also embarked on an ambitious in-building

coverage project in Bangkok to augment the quality of our service in the Capital. If our focus is to be on

meeting the needs of our customers it is necessary to have a network in place that provides them with

high standard service levels in the areas where they are mobile. I am happy to report that the network

roll out in 2001 was completed with spectacular success as a result of the planning and cooperation

between DTAC and our principal shareholders, the UCOM Group and Telenor.

Delivering quality service at a reasonable price requires that we work smarter. In 2001 we worked on a

number of areas to improve the efficiency in our key business processes and our overall productivity. In

particular, recognizing the value of our employees, we enhanced training programs in a number of

disciplines and are in the process of implementing and integrated HR program that includes a

performance-based reward and recognition system.

Year 2002 will be a very dynamic year for the wireless telecommunication industry in Thailand and will

present challenges to the players in it. Intensified competition, the possibility of regulatory changes and

domestic economic pressures all need to be included in our plans. However, given the foundation that

we have built over the past few years, I am confident that DTAC now has the approach, infrastructure,

people and customers to take on these challenges and continue to succeed.

Our vision is to be Thailand's telecommunications service company of choice, meeting the needs for

communication and interaction among the people, businesses and communities that we serve. This

requires that we continue to work diligently to sustain growth in our customer base, controlling costs,

developing our products and services and keeping our customers satisfied. In this way we will build an

organization that enhances all of our stakeholders values.

Finally, I would like to take this opportunity to thank all our shareholders for their continued supports

and confidence in our company.

a n n u a l r e p o r t 2 0 0 1Total Access Communication Plc.02 a n n u a l r e p o r t 2 0 0 1

Total Access Communication Plc. 03

DirectorsBoard of Total Access Communicat ion Plc

Mr. Boonchai Bencharongkul

Chairman of Board of Directors

and Chief Executive Officer,

Total Access Communication Plc.

1984 - 2000 Chief Executive Officer,

United Communication Industry Plc.

Mr. Somlak Sachjapinan

Deputy of Board of Directors

and Chief of Engineering Steering Committee,


1986 - 1991 Senior Executive Vice President,

The Communications Authority of Thailand

1999 - 2001 Cheif Executive Officer, Total Access

Communication Plc.

Mr. Vichai Bencharongkul

Director, Total Access Communication Plc.

2000 - present Chairman of Board of Directors

and Chief Executive Officer,

United Communication Industry Plc.

M.R. Tongnoi Tongyai


2001- present Personal Counselor to HRH the Crown Prince

Present Chairman and Audit Committees,


Mr. Chulchit Bunyaketu


1998 - present Managing Director,

Thai Oil Company Limited.

Mr. Soonthorn Pokachaiyapat


1974 - present Head of Chaiyapat Law Office

Mr. Pakkaporn Sathienpakiranakorn


1994 - present Executive Vice President

(Telecommunications services), The Communications

Authority of Thailand

Mrs. Tasanee Manorot


present Senior Executive Vice President (Finance),

Telephone Organization of Thailand

Mr. Arve Johansen


1999 - present Senior Executive Vice President

Telenor AS and Chief Executive Telenor Mobile

Communications

Mr. Sigve Brekke

Deputy of Board of Directors,


2000 - present Managing Director, Telenor Asia Pte. Ltd.

Mr. Bjorn Magnus Kopperud


2000 - present Executive President,

Telenor Mobile Communication AS

a n n u a l r e p o r t 2 0 0 1Total Access Communication Plc. 05a n n u a l r e p o r t 2 0 0 1

Total Access Communication Plc.04

1. Management

Management Structure

The Company's central management structure consists of the Board of Directors, the Board of

Management and the Audit Committee. The Board of Directors is responsible for setting overall policies

and strategies. The Chief Executive Officer ("CEO") is responsible for the implementation of strategies in

accordance with stipulated policies. The Chief Operating Officer ("COO"), Chief Financial Officer ("CFO")

and Senior Group Director (Corporate) have separate areas of responsibility. These executives and other

senior managers form the Board of Management, while Telenor nominates the COO and CFO.

Board of Directors: Appointments and Withdrawals

Appointments to, and withdrawal and retirement from the Board of Directors are governed by the

Company's Articles of Association that require:

1. The Board of Directors must have at least 5 members and at least half of the Directors appointed

must have permanent residence in Thailand.

2. The shareholders appoint the members of the Board:

a) Voting is in proportion to the number of shares held.

b) Votes can be for one or a group of nominees but votes cannot be split between a number of

nominees.

c) Nominees with the highest number of votes are appointed. Where there is a tie, the chairman of

the meeting has the casting vote.

3. A Board member wishing to resign from his position must submit a letter of resignation to the

company. A resignation takes effect when the Company receives it.

4. The withdrawal of a Board member before the mandatory retirement age can be proposed at a

shareholders' meeting where at least 3/4ths of all shareholders are present and have a right to vote.

At present, the Company's Board of Directors comprises of eleven members; three as independent non-

executive directors, three from United Communication Industry Plc. (UCOM), three from Telenor Asia Pte

Ltd (Telenor), one from the Communication Authority of Thailand (CAT) and one from Telephone

Organization of Thailand (TOT).

Corporate Governance

Total Access Communicat ion Plc .

Co

rpo

rate

Go

vern

an

ce



Independent Directors

The Company has three independent directors; all are non-executive and carry out the functions

independently of the executive directors and management of the Company. They are

1. MR. Tongnoi Tongyai

2. Mr. Chulchit Bunyaketu

3. Mr. Soonthorn Pokachaiyapat.

The Audit Committee

The Audit Committee has been established under the regulations of the Stock Exchange of Singapore. It

is comprised of three independent Board members.

The Committee's responsibilities are:

1. Financial Reporting and Auditing

a) Examine the Company's financial statement and accounts.

b) Consult with the independent auditor as necessary.

c) Make recommendations concerning the appointment of the independent auditor.

d) Present the Audit Committee's Report, signed by the Chairman of the Audit Committee, as an

integral part of the Company's Annual Report

2. Monitoring, Supervision and Advice

a) Monitor the Company's business to ensure that it is in accordance with the law and regulations of the

Stock Exchange of Singapore and any other relevant law.

b) Making available accurate information about the company's finances in those instances where

inappropriate transactions, conflicts of interest or other anomalies occur.

c) Advising the Board of Directors on matters that: have an impact on the Company's financial status

and its day to day operations; involve conflicts of interest and/or corruption; relate to significant

errors in the internal control system; are considered likely to be contrary to the law and regulations of

the Stock Exchange of Singapore or other laws relevant to the Company's business.

d) Directing and supervising the internal audit division to ensure that it operates independently and

efficiently.



3. Internal Control

Reviewing the Company's internal control and internal audit system to ensure that they are suitable

and effective.

Remuneration

The remuneration of the directors and management staffs in 2001 was:

Remuneration 2001 1) Board of Directors Baht 420,000.00

(for meeting attendance)

2) Thai Management Baht 40,359,194.00

(in aggregate)

Notes: 1) Paid to the three independent directors. Directors who are also on the Board Management do

not receive this remuneration.

2) Remuneration for Thai management includes salaries, bonuses, and allowances for vehicle

expenses. This excludes management appointed by Telenor who are billed to the Company

under a service agreement.

2. Business Supervision

The duties and responsibilities of the Board of Directors is set out in the Company's Articles of

Association and in the regulations of the Stock Exchange of Singapore. The Board of Directors also

operates under the Code of Best Practice guidelines issued by the Stock Exchange of Thailand.

Supervision is carried out by the Board of Directors through the Operating Committee.

3.Internal Information Management

The Company has established policies to prevent the manipulation and misuse of information. These

policies are constantly monitored to ensure compliance by management and staff.

4. Internal Control System

The Company has established internal control systems to maintain the integrity and security of the

Company's assets and data. These internal control systems clearly define the powers and authority of

management with respect to the use of the Company's resources and include approval and processing

controls to ensure that transactions are appropriately authorized and properly recorded and that assets

and data are properly protected.

The Audit Committee regularly reviews the efficiency, sufficiency and suitability of the company's

internal control systems in different areas such as: organization and environment; risk management;

operational control; information technology systems; and information communication and monitoring

systems. Reports are made to the Board of Directors on significant anomalies discovered and where

actions are to be taken to bring about improvements and rectification.

Corporate Governance

.........................

...............................

...............................

......... ...

.............................

......................................

........................

Organization ChartTotal Access Communicat ion Plc .

Boardof the

Directors

Internal AuditCommittee

CEO

...........................................................................................

Sr.GroupDirector

Corporate

COO CFO

ACOO( Commercial Unit )

ACOO( Operation )

CorporateGroup

ACFO( Accounting )

ACFO( Treasury )

ACFO( Capital Market&IR )

ACFO( CHIEF OF STAFF )

.........................................................................



ManagementExecutiveTotal Access Communicat ion Plc .

1

2

3

4

5

6

7

8

9

10

Mr. Boonchai BencharongkulChief Executive Officer and Chairman of Board of Directors, Total Access Communication Plc.

1984-2000 Chief Executive Officer, United Communication Industry Plc.

Mr. Somlak SachjapinanChief of Engineering Steering Committee and Deputy of Board of Directors, Total Access Communication Plc.

1986-1991 Senior Executive Vice President , The Communications Authority of Thailand

1999- 2001 Cheif Executive Officer, Total Access Communication Plc.

Ms. Helene SandbergChief Operating Officer, Total Access Communication Plc.

1996-1997 Business Advisor, Digifone, Ireland

1998-1999 Head of Products & Services-Marketing in Connect Austria

1999- 2001 Vice President Marketing/Customer Service, Telenor Mobile AS

Mr. Grant Scott FergusonChief Financial Officer, Total Access Communication Plc.

1996-1997 Vice President, Treasury, First Pacific Company, Hong Kong

1998 - 1999 Director and CFO, First Pacific Company, Indonesia

1999 - 2000 Director and CFO, Metro Pacific Corporation, Philippines

Mr. Pitjapol JantanasaroSenior Group Director - Corporate, Total Access Communication Plc.

1998-2000 Department Director of CSU, United Communication Industry Plc.

2000-2001 Deputy Managing Director, Total Access Communication Plc.

Mr. Petter Borre FurbergAssistant Chief Financial Officer, Total Access Communication Plc.

1998-1999 Telenor International Business Controller

2000-2001 Telenor Mobile Communications, VP Finance

Mr. Sawat ChantrasriAssistant Chief Operating Officer- Operation, Total Access Communication Plc.

1991-2001 Deputy Managing Director, Total Access Communication Plc.

Mr. Premon PinskulAssistant Chief Financial Officer- Accounting, Total Access Communication Plc.

1999-2000 Assistant Managing Director and Department Director of CSU

2000-2001 Assistant Managing Director and Department Director of Accounting

Mr. Somkiat Atiyudhakul Asistant Chief Financial Officer- Treasury, Total Access Communication Plc.

1990-1991 The union Bank of Bangkok Plc.

Ms. Kulvadee KanjanaboseAssistant Chief Financial Officer- Capital Market & IR, Total Access Communication Plc.

1986-1989 Senior Account officer, Commercial Credit Department Siam Commercial Bank Plc.

1

8

6 4

5

910

32

7

Mr. B

oonchai Bencharongkul

Mr. S

omlak S

achjapinan

Ms. H

elene Sandberg

Mr. G

rant S. Ferguson

Mr. P

itjapol Jantanasaro

Mr. P

etter Borre Furberg

Mr. S

awat C

hantrasri

Mr. P

remon P

inskul

Mr. S

omkiat A

tiyudhakul

Ms. K

ulvadee Kanjanabose



March 2001 The DTAC brand and corporate identity was introduced together with

a customer focused business approach that radically changed the way wireless

services are marketed in Thailand and customers expectations of service providers.

April 2001 The Telephone Authority of Thailand approved a change in the access

charge paid for prepaid customers from Baht 200 per month per customer to 18% of

the value of prepaid vouchers sold.

April 2001 The Company successfully issued Baht 15,000 million of amortizing

bonds in the local market at a coupon rate of 5.60% per annum. These bonds will

mature in 2006 and were used to refinance existing debt and fund the 2001 capital

expenditure program.

June 2001 The Djuice Internet portal was launched as a gateway to the mobile

Internet utilizing WAP (Wireless Application Protocol).

August 2001 Moody Investor Services upgraded the Company's rating from B2 to B1

September 2001 The " Dprompt" prepaid brand was repositioned in the market,

promoting a "Be Smart" concept. This move was designed to increase the products

visibility in the market and differentiate it from competing products.

October 2001 The Company signed a credit agreement with local financial

institutions for a long-term facility amounting to Baht 16,000 million. This facility

replaced a previous facility provided to the Company in July 2000, but which had

remained unutilized.

November 2001 GPRS (General Packet Radio Service) was launched. This will be

used as a platform for advanced data services, mobile commerce and mobile

Internet access as these products are sought by the market in Thailand. DTAC is the

first nationwide GPRS network.

December 2001 The GSM network Phase 3 expansion was completed. By end

2001 this network covered 70% of population in Thailand.

Highl ight in Total Access Communicat ion Plc .

1stQuarter

2ndQuarter

3rdQuarter

4thQuarter

Operational Review

In Conversation withHelene Sandberg, COO



2001 2001

With her experience and upbeat attitude Helene is a true representation of DTAC. A multi talented

professional with diverse qualifications, her contribution makes her, amongst others, a voice for the new

spirit of DTAC, which she claims has offered her great opportunity and much joy. Helene started working

with Telenor at the age of 16, and she is now in a home far from home, working with DTAC as Chief

Operating Officer. Before joining DTAC, she also worked with two of Telenor's international operations in

Ireland and Austria as well as being a key member of the senior management team that brought wireless

services to Telenor's home market of Norway.

"Make It Easy" is more than a tag line. It is the

philosophy around which DTAC is now centered, explains

Helene. "DTAC is easy to use, easy to understand and

easy to access. Our high quality network, our very

simple price plans and our wide distribution and service

network are all part of the brand promise to Make It

Easy. Fairness and transparency are two other key

attributes of the DTAC brand. Per second charging, flat

rate nationwide and our "Network Quality Guarantee"

are good examples of how want to be understood by our

customers."

"The whole exercise of re-branding TAC to DTAC was to create a much clearer

position in the marketplace, both visually and in terms of consumer benefits.

However, a brand is much more than an advertising and sales campaign. The

brand values have to be demonstrated every single day - by each and every

employee. Not an easy task when a company has more than 2,500 employees,

but achievable. Several training programs have been introduced, including the

Customer Service Group in the first instance." A major independent survey

carried out late 2001 showed that the efforts have already yielded results.

In this survey DTAC achieved a service index score that indicates

that the Company is a market leader in this area."

(Unit: Thousand Baht)

2001 2000 1999

Total Access Communicat ion Plc .

Key Figures

He

len

e S

an

db

erg, C

OO

Income StatementRevenue

From telephone services

From sales of telephone sets

From sales of retail goods

Other operating income

Other income

Total Operating Revenue

Operating Expenses

Cost of services

Cost of sales of telephone sets

Cost of sales of retail goods

Selling and administrative expenses

Total Operating Expenses

Interest income

Financial cost

Foreign Exchange gain (loss)

Earnings Before Income Tax

Corporate income tax

Net Earnings

Earnings per share (Baht)

22,028,477

7,051,841

439,859

579,355

85,535

30,185,066

11,066,597

6,748,216

336,564

6,786,195

24,937,572

485,186

(3,122,431)

345,051

2,955,300

(860,339)

2,094,961

4.42

15,865,871

4,920,767

469,861

1,607,089

442,781

23,306,369

7,364,324

4,282,319

379,906

4,735,857

16,762,406

505,945

(3,269,715)

(2,697,603)

1,082,590

(434,789)

647,800

1.50

12,067,507

3,856,908

457,328

1,789,877

139,903

18,311,523

5,814,926

2,967,863

379,533

4,026,349

13,188,671

569,671

(3,348,235)

(694,971)

1,649,318

(352,630)

1,296,688

3.30

Balance SheetTotal assets

Total long term borrowing

Total liabilities

Total equity

Weighted average number of

shares (Share)

82,046,393

42,714,297

57,709,099

24,337,293

474,416,126

65,042,352

31,310,043

42,800,020

22,242,332

474,416,126

57,951,602

26,624,099

46,698,694

11,252,908

404,416,126

Financial RatioNet profit/Revenue

Return on equity

Return on asset

Earning per share

Book value per share

6.94%

9.00%

2.85%

4.42

51.30

2.78%

3.87%

1.05%

1.50

46.88

7.08%

13.22%

2.17%

3.30

27.83



the network roll-out program in 2001. In the space of that

one year, we have been able to expand the network from

less than 1,500 base-stations to over 3,000 base-stations.

We have also installed micro-sites in an additional 295

buildings to improve the quality of in-door coverage."

Despite the successes in 2001, Helene refuses to allow any complacency in her thinking. "I sense the

coming years will be every bit as exiting and as challenging as 2001. However, with an ever-increasing

customer base and a broader knowledge in the market about the potential for wireless communication,

the challenges that we will face will be even more diverse than in the past. We will need a full

understanding of the needs of both the existing and potential markets and make sure that we have

innovative products in the market when they are required. We also need to continuously review how we

deliver outstanding customer service in a cost effective way. This degree of understanding and service

level requires a lot of research and education. But more importantly it requires that our whole

organization is focused on satisfying customer needs and that we work across functional lines with a

common goal."

Helene is also quick to point out that while the customer is paramount, technology remains the

foundation of the business. "We will also of course implement new technology in order to deliver the

products and services that our customers want. However, I firmly believe that market demand leads the

technology choices rather than technology dictating to the market. We have a lot of creative people in the

Company. Sometimes the challenge is keeping their feet on the ground", Helene adds with a wry smile.

Given her international experience, how does she compare DTAC to other companies in the business?

"We know that we have still got our work cut out in many areas but we have already made a lot of

progress. I think the DTAC of today represents the best of Thai style and culture and international best

practice. We can certainly compare favorably with the best telecommunication companies in the world in

the key business process. That's one of the reasons why I am so confident in DTAC's future."

"We are first and foremost a consumer services business. That requires that we understand the needs of

our customers, respond to those quickly and generally improve their overall experience of dealing with

DTAC. This will become increasingly important as our subscriber base grows and as competition

intensifies. "D4U" - the first loyalty program in Thailand to be offered both prepaid and postpaid

customers - that we launched in 2001 is the type of program that we will continue to develop to enhance

the customer experience."

According to Helene, DTAC now talks with confidence about the quality of its network. "Of course,

without a good network our ability to deliver quality service would be impaired". I am very pleased with

The Year in Review

Financial ReviewBy Grant Ferguson, CFO

By Grant Ferguson, CFO



Operating Performance

Creating a brand that would allow us to acquire and sustain a large and lucrative part of the

increasingly competitive wireless telecommunications market in Thailand was

key to our business strategy. The introduction of the DTAC brand in 2001 was

accompanied by a dramatic change in the way we charge our customers for

service and a significant reduction in restrictive fixed costs (such as handsets

and monthly fees). This new way of doing business is an integral part of

developing a brand that people understand and trust and in making service

affordable to a greater proportion of the residents of Thailand.

The success of this approach

has seen our subscriber base

increase to 2,737,598 at end

2001 from 1,403,300 at end

2000. As a result consolidated

Breakdown of revenue and % of total in 2001 and 2000

1999 2000 2001

60%

50%

40%

30%

20%

10%

0%Year

12,000

10,000

8,000

6,000

4,000

2,000

-

8,113

10,3059,150

EBITDA Service Margin Handset and Retail Margin

Mill

ion

Bah

t

EBITDA and margin from wireless and handset businesses

220.000

200.000

180.000

160.000

140.000

120.000

100.000

80.000

60.000

40.000

20.000

-20.000

220.000

200.000

180.000

160.000

140.000

120.000

100.000

80.000

60.000

40.000

20.000

-20.000

59,000

63,450

102,200105,475

102,578101,441

102,497102,032

99,678100,842

104,329

111,206

Jan-01Fed-01

Mar-01

Apr-01

May-01

Jun-01Jul-0

1Aug-01

Sep-01Oct-0

1Nov-01

Dec-01

Postpaid Prepaid Cum.Ave. in 2001

-

2001 Net Addtional Subscribers.

Firstly, as a result of introducing what we believe to be fairer charging principals, and the uptake of

prepaid customer, average revenue per user (or ARPU) declined by 20% to 908 in 2001 prepaid service

allows more cost conscious consumers to better manage their expense and therefore broadens the

potential market but generally produces a lower ARPU.

Secondly, as wireless services is our core business, in order to make it more accessible we have

consciously set about reducing the price that our customers have to pay for handsets. As a result the

average margin in this business area declined from 13% in 2000 to 4% in 2001. However, our focus will

be on developing products and services in the wireless business for voice and data. Services such as

text messaging are in their infancy in the Thai market but have great potential. Realizing this means

minimizing obstacles to using the service, such as the cost of hardware.

Thirdly, as our future will be built around the DTAC brand, it was imperative, that we invested sufficient

resources in it upfront to achieve maximum impact in as short a time as possible. In 2001 we, therefore

spent heavily in advertising and promotion to ensure that the DTAC brand was quickly recognized and

understood by the market. As a result, selling and administrative expenses increased to THB 6,786

million compared to THB 4,736 Million in 2000.

Net income for the year of THB 2,095 million compares to THB 648 million in 2000. The reduction in

operating profit was offset by the elimination of exchange losses in the previous year and the control of

financing costs.

Operating Revenues 2000 rev. 2001 rev. chg.YoY

Revenue from Telephone Service 15,865.87 68% 22,028.48 73% 39%

Revenue from sales of telephone sets 4,920.77 21% 7,051.84 23% 43%

Revenue from sales of retail goods 469.86 2% 439.86 1% -6%

Other operating income 1,607.09 7% 579.36 2% -64%

other income 442.78 2% 85.53 0% -81%

Total operating revenues 23,306.37 100% 30,185.07 100% 30%

% total % total %

revenues increased to THB 30,185 million in 2001 compared to THB 23,306 million in 2000.

From these revenues, we produced operating income of THB 5,247 million or 17% of revenue compared

to THB 6,544 million or 28% of revenue in 2000. This reduction was brought about by three principal

factors, all of which were key to the success of our strategy.

By Grant Ferguson, CFO



Table of principal financial ratios at the end of 2001

Gross Profit Margin (%) 38.92

Current ratio (x) 1.08

Total Debt to Equity (x) 1.76

Shareholders equity increased to THB 24,337 million from THB 22,242 million at end 2000 due to the

2001 net income transferred to reserves.

Financial Status

We have worked diligently on our balance sheet in 2001. All US Dollar debt exposure has now been fully

hedged and in April 2001 we issued THB 15,000 million of amortizing bonds in the local market with a

final maturity in April 2006 that were primarily used to finance debt maturities.

In October 2001, we entered into a credit Facility Agreement with 9 local and foreign banks for THB

16,000 million with a final maturity in June 2006. This facility that is available until November 2002

replaced facilities in the same amount entered into in July 2000 but which had not been utilized due the

availability of more cost effective funds in the local bond market. The new facility includes a provision to

allow up to THB 8,000 million to be replaced by Export Credit Agency (ECA) supported financing. In

December 2001 such an agreement was concluded with Finnvera, the Finnish ECA, for a guarantee

covering US$ 120 million of loans with a final maturity in December 2009 funded by 3 international

banks. At the same time an equivalent proportion of the bank facility was cancelled.

We believe that "Making It Easy" applies to every aspect of our business, including corporate governance

and investor relations. While there remains room for improvement in these areas we are in the process of

implementing reporting and information services designed to improve the awareness and transparency

of our business strategies, goals and results.

Facility AMOUNT

in USD in THB%HEDGING

TOTALAMOUNT (THB) MATURITY

USD Debt

1.ECD1-Non Exercise 1.50 - 100% 37.94 May 31,2006

2.Yankee-06 300.00 - 100% 13,306.11 Nov 4,2006 (B)

Total USD Debt 301.50 - 100% 13,344.05

THB Debt1.TAC05 OA - 6,000.00 - 6,000.00 2002-2005 (A)

2.TAC064A - 15,000.00 - 15,000.00 2003-2006 (A)

3.Baht Syndicated Facility - 6,500.00 6,500.00 2003-2006 (A)

4. 3-month B/E - 222.50 222.50 28/02/2002 (B)

Total THB Debt 27,722.50 27,722.50

Total DEBT - 41,066.55

Note : (A) = Amortized repayment

(B) = Bullet repayment

Financial Performance

To ensure that the quality of service was consistent with the brand promise, we invested heavily in

operating infrastructure in 2001. Capital expenditure of THB 20,000 million was the principal reason

behind a 26% increase in total assets to THB 82,046 million at end 2001. Much of the capital

expenditure was incurred in an aggressive network rollout program that saw our service coverage area

increase from around 48% of the Thai population at the beginning of 2001 to 70% by the end of the year.

Telenor's involvement in this process not only contributed to the technical success of the project but also

allowed us to avail of equipment unit costs significantly lower than in previous years. The support of the

UCOM Group, who was responsible for much of the installation work, was also critical to the success of

this project

Total liabilities at end 2001 of THB 57,709 million compared to THB 42,800 million at end 2000. This

was primarily due to an increase in total outstanding debt obligations from THB 31,310 million at end

2000 to 42,741 THB million at end 2001.

Working capital, excluding the current portion of long-term debt obligations, at end 2001 was THB 1,894

million compared to THB 8,908 million at end 2000 due to an increase in payables to equipment

vendors deferred until the ECA facilities had been approved, increases in inventory and accounts

receivable due to the scale of operations and lower cash balances due to the 2001 capital expenditure

program.

Debt profile at the end 2001

Total Access Communicat ion Plc .RISK FACTORS

Risk factors, which may have an impact on the Company can be classified into four categories:

1. RISK FROM LEGAL ISSUES• Concession conversion

Section 80 of the Telecommunications Services Act 2001 specifies that the existing telecom operators

will have entered into an agreement to terminate existing concession contracts prior to receiving a

license to operate from the National Telecommunications Commission ("NTC"). Currently the NTC has not

commenced operations and therefore details of possible licensing arrangements are not available.

Various concession conversion frameworks have been proposed and the Company has provided input to

these proposals. However, to date none of the proposals have been agreed to by Government, the

Company and the Communications Authority of Thailand ("CAT"). There is no time frame for completing

this process. Concession conversion is at the discretion of the Company. If the Company chooses not to

convert its concession, operations under the existing concession would continue.

•Possible restriction of foreign shareholdings

Section 8 of the Telecommunications Services Act 2001 limits the percentage of foreign shareholdings

in telecommunication operating companies to 25 percent. This may effect existing concession operators

if the concession were to be converted into a license granted by the NTC.

The Company and other operators have expressed concern about this provision and the Government has

publicly stated that they will seek to amend this section. However, to date that process has not been

completed.

2. RISKS FROM MARKETS AND COMPETITION•New operators

Three new operators may commence offering service to the wireless sector in 2002, namely TA Orange

Co., Ltd., ACT Mobile Co., Ltd. (a joint venture between The Telephone Organization of Thailand ("TOT"),

CAT and Aeronautical Radio of Thailand Ltd. to operate in the 1900 MHz. frequency), and Hutchison CAT

Wireless Multimedia Co., Ltd. (a joint venture between CAT and Hutchison Telecommunications

Investment Ltd. to operate a CDMA service in the 800 MHz. frequency).

The potential entry of these operators may have an impact on overall market growth and the Company's

market share. However, the Company believes that the scale and quality of its network, the size of its

customer base and quality of customer service, its management expertise, its shareholders'

commitment, and its financial resources will allow it to remain competitive and continue to be a market

leader in the wireless services sector.



3. RISK FROM OPERATIONS•Bill collection and bad debt

The Company's customer base comprises prepaid and postpaid customers. Postpaid customers receive

monthly bills subsequent to usage. The Telecommunications Services Act 2001 prohibits operators from

collecting deposits from customers. The Company had already voluntarily stopped taking deposits from

new subscribers but this legislation means that deposits may not be used in the future to reduce the

Company's risk of bad debt.

The Company has implemented various methods to manage this risk including setting up credit limits,

implementing a Bill Reminder System, monitoring payment trends to detect potential collection

problems, subcontracting the collection of long overdue bills to professional agencies and taking legal

action against bad debt customers and terminating relationships with dealers who may have colluded

with them. A lotto program has also been introduced to encourage customers to pay by the due date.

4. FINANCIAL RISK •Exchange risk on operational transaction

The Company's revenues are primarily received in Thai Baht but new investment for network equipment

is primarily denominated in foreign currencies. The Company uses forward currency contracts to hedge

the exchange risk from current liabilities denominated in currencies other than Thai Baht. However, there

remains the possibility of exchange losses arising on these transactions.

• Financial instruments used in risk management

In order to secure optimal financing terms, the Company may enter in debt instruments denominated in

a foreign currency. It is the Company's policy to exchange resulting foreign currency liabilities into Thai

Baht. Currently, the Company's interest payment and debt repayment obligations in currencies other

than Thai Baht have been fully hedged using various financial instruments, principally cross currency

swaps and foreign currency forward contracts.

The Company has established policies for the use of derivative financial instruments, including the

approval of counterparties with a minimum "A" credit rating and only entering into such transaction in

properly functioning and regulated capital markets.

in ThailandWireless industryThe Telephone Organization of Thailand ("TOT") and The Communications Authority of Thailand ("CAT"),

under the supervision of the Ministry of Transport and Communications, and private sector operators

operating under concessions awarded by the two State agencies, are the principal sources of service to

the Thai telecommunications market today. The concessions were granted in the early 1990s in the form

of Build-Transfer-Operate ("BTO") contracts to assist the State agencies to keep pace with the growing

demand in the Country for telecommunication generally, and wireless services in particular.

Under the BTO agreements, private sector enterprises are required to build and operate

telecommunication networks and provide services on a revenue sharing basis with the State agency

awarding the concession. Network infrastructure is transferred to the concession-granting agency once it

is installed. The concessionaire has the exclusive right to use the assets transferred for the term of the

concession. As well as being operators in their own right, TOT and CAT are also currently the effective

regulators of the telecommunications industry in Thailand.

Thailand has obligations under its agreement with the World Trade organization to fully liberalize the

telecommunication sector by 2006. Towards this, various initiatives have commenced including planning

for the corporatization and privatization of TOT and CAT. In 2000 The Frequency Allocation Act

established a National Telecommunications Commission ("NTC") to be the independent regulator of the

industry. Responsibility will be transferred to this body once members have been selected. In 2001 The

Telecommunication Service Act was passed and established a basic framework for the industry. This Act

provides for the right of operators currently working under concession arrangements to convert these

contracts to licenses awarded by the NTC upon reaching mutual agreement with the State Agencies

awarding the concessions.

Market Share

At end 2001 the wireless services market had around 8 million customers. This equates to a

penetration rate of 13% compared to 6% at the end 2000. The DTAC brand launch and network

expansion, and innovative marketing campaigns and the promotion of prepaid services by both the major

operators spurred this increase of approximately 4 million net new subscribers.

Operators

Currently there are seven wireless services operators in the Country. As of end 2001 five had

commenced operations.

Operator Major shareholder System Bandwidth(MHz)

Concessiongranted by

Concession end

2018DTAC UCOM (42%)Telenor (30%)

TOT (10%)

AMPS 800-bandB PCN 1800

13.550

CAT

AIS SHIN (41%)SingTel (20%)

NMT 900GSM 900

7.510.0

2016TOT

DPC AIS (95%) PCN 1800 12.6 CAT 2018

TA-Orange* Orange SA (49%)TA (41%)

CP Group (10%)

PCN 1800 12.6 2018CAT

HutchisonCAT*

Hutchison (49%)CAT (35%)

CDMA 800- band A

N/ACAT10.0

TOT State Enterprise NMT 470 TOT5.0 N/A

Thai Mobile TOT (55%)CAT (40%)

GSM 1900 N/AN/AN/A

Note : *TA-Orange and Hutchison CAT are scheduled to launch their service in the 1Q02

Source: Agricultural and Services Team, Bank of Thailand

As of end 2001, customers electing for prepaid service accounted for approximately 40% of total mobile user.

Data and Other Value Added Services

A full range of data and other value added service (VAS) is offered in the Thai market. Services include

Voice Mail Service, International Roaming service, Voice Based Data service, General Packet Radio

Services ("GPRS"), and Short Message Service ("SMS"). Despite the launch of GPRS in 2001 and

increasing popularity of SMS, in 2001, all VAS accounted for only approximately 4 - 5% of total market

revenue in Thailand. SMS usage in particular is still below Asian averages.

DTAC34.39%

DPC4.77%

CAT0.10%

TOT0.29%

AIS60.45%

Prepaid12%

Postpaid88%

At the end of 2000

Prepaid32%

Postpaid68%

At the end of 2001



SMS Usage Pattern in Asia Pacific

Out

boun

d S

MS

/us

er/m

onth

Philippines

Japan Singapore

Hong KongAustralia

Taiwan

New ZealandMalaysia

Thailand

IndonesiaKorea

China India

Cost per Outbound SMS (US$)

300.00

250.00

200.00

150.00

100.00

50.00

0.00

0.00 0.05 0.10 0.15 0.20

Source : DTAC

DTAC Customer Base

Total Market share (as of end 2001)

Source : DTAC

Source : Gartner

Story

Who are we?September 1991 AMPS 800 mobile telephone services launched under the WorldPhone

800 brand.

September 1994 GSM 1800 digital cellular services introduced under the WorldPhone

1800 brand.

February 1995 Registered as a public company and listed on the Stock Exchange of

Singapore later in the same year, making it the first Thai company to have

stock listed on an overseas market.

January 1996 Registered in the Bangkok Stock Dealing Center, Over the Counter Market .

July 1998 Signed an agreement to extend repayment schedule for US$ 537 million

of debts.

May 2000 United Communication Industry (Public) Company Limited (UCOM), the

company's largest shareholder, signed an agreement with Telenor Asia

Pte., Ltd. (Telenor), under which Telenor acquired a 24.8% interest in

UCOM and a 28.77% in the Company for approximately US$ 720 million.

March 2001 DTAC brand and corporate identity introduced to replace all existing

brands and simplified and transparent charging principals introduced to

customers.

December 2001 Third phase GSM network expansion program completed.

February 2002 Registered customers passed 3 million

BackgroundTotal Access Communication (Public) Company Limited or "DTAC" was founded in August 1989 as a

company limited under the Civil and Commercial Code, with registered capital of one million Baht,

divided into 100,000 ordinary shares with a par value of 10 Baht per share. The Company primarily

provides wireless telecommunication service in Thailand, using both analog (AMPS 800) and digital

(GSM1800) platforms. These systems operate in 28 MHz of the 800 MHz frequency and 100 MHz of the

1800 MHz frequency respectively. The AMPS 800 network has coverage throughout Thailand, including

the Bangkok area and other major towns, cities and highways. The GSM1800 network covered

approximately 70% of the country's population at the end of 2001. In March 2001, the Company

launched its new identity and principal brand name, "DTAC" and the related service philosophy of "Make

It Easy". The Company also distributes cellular telephones and accessories as well as other

telecommunication equipment.

The Company operates under a "Build-Transfer-Operate" concession granted by the Communications

Authority of Thailand that expires in 2018. A brief overview of the concession arrangements is included

in the industry review on Page 24.

Milestones in Our HistoryTotal Access Communicat ion Plc .



The

Subsidiaries and Other Associated Companies

Subsidiaries

a n n u a l r e p o r t 2 0 0 1Total Access Communication Plc.28

Our PeopleAt the end of 2001, the Company had 2,617 full-time members of staff compared to 2,615 at the end of 2000.

We believe that in order to deliver outstanding service we need outstanding people. We therefore work

continuously to develop the skills of our people, our most valuable asset. This is done through various

programs including structured courses, on the job training and skill transfer assignments from Telenor

management and staff. In 2001, in addition to three permanent senior management positions appointed

by Telenor, between 10-15 project managers or advisors were seconded to DTAC at various times. "The

Basic Principles of Competency" is our in-house mandatory training program for all staff that includes

customer focus, building strategic working relationships, planning and organizing, contributing to team

success, continuous learning, and initiating action.

We have also introduced processes to promote responsibility, innovation and cross-functional teamwork,

and reporting procedures to improve transparency and accountability. At the same time we are

developing a performance based rewards and recognition system to be implemented at all levels of the

organization to reward individuals contribution and promote wider buy-in to the Company's success.

At DTAC we aim to be at the forefront of human capital development in Thailand.


Company Type of Business Proportion of shares

held by DTAC (%)

TAC Property Co., Ltd. Golf club operator and leases certain 99.9

telecommunication equipment

Eastern Beach Co., Ltd. Land owner 99.9

(held through TAC Property)

Viphavadee Office Building Co., Ltd. Building owner 99.9


Piyanee Co., Ltd. Currently inactive 99.9


TAC Investment Ltd. Investment Company (registered in Western Samoa) 100

TAC Finance Company B.V. Finance Company (registered in the Netherlands) 100


WorldPhone Shop Co., Ltd. Operates "Rak Bankerd" shops 99.9

(Previously AM/PM shops)

TAC Service Co., Ltd. Currently inactive 99.9


held by DTAC (%)

Frequency Media Co., Ltd. Currently inactive 40

Wireless World Co., Ltd. Currently inactive 25


held by DTAC (%)

United Telecommunications 41.64

Communication

Industry Plc.

Telenor Asia Pte Ltd. A Singapore registered telecommunications 29.94

investment company indirectly owned 100% by

Telenor ASA, (a company registered in Norway)

Affiliated Companies

Related Companies

W h a t d o w e h a v e ?

AMPS800 GSM1800 Total

Postpaid Customer 350,510 1,511,583 1,862,093

Prepaid Customer 77,033 798,472 875,505

CustomersAs at end 2001, there were 2,737,598 DTAC customers.

Approximately 60 % of there customers were in the Bangkok area.

Network1800 MHz Digital System 2001 2000

Cell Sites: Bangkok 1,010 624

Upcountry 2,257 1,087

Switching Capacity 3,500,000 850,000

We have international roaming services to 88 countries throughout the worldwide covering

every major business center. We have mobile Internet roaming in 21 countries.

2001 2000

Cell Sites: Bangkok 434 461

Upcountry 700 697

Switching Capacity 1,500,000 1,500,000

800 MHz Analog System

ProductsThe philosophy behind the DTAC brand is to make it easy to deal with us, to offer products that are easy

to understand and that are fair and increase customer confidence by being transparent. All products and

services that we offer are designed to support these guiding principles. We currently have four principal

service packages all of which offer per second billing and a standard nationwide rate. These are then

adapted when necessary to fit the need of different market segments (for example corporate customers

or social groups) or to increase the flexibility for customers (for example the "Topping" promotions for

customer whose usage is between the optimum levels for the various post paid packages).

Dpackages

Package Monthlyfee

Freecall Rate

250 baht

3 baht/min

0 4 baht/min

750 baht 250 mins

2 baht/min1200 baht 600 mins



Dprompt is DTAC prepaid product offered in both AMPS800 and GSM1800 systems.

During September 2001, Dprompt was reintroduced with a separate identity under a "Be Smart"

concept while still retaining its association with the DTAC brand to promote it as the most sophisticated

and highest value offering in this segment of the market. The new Dprompt includes value added

services such as call waiting, conference calling, SMS, DTAC Mail and Djuice Internet access. .

Description Normal Service Rate Dprompt Rate

Same area service rate 6 baht / min 5 baht / min

Long-distance rate 11 baht / min 5 baht / min

Call outside registered area No charge No charge

Monthly service No charge No charge

Receive incoming call No charge No charge

International call Thai Card by The Communications Authority of Thailand

Value Added Services* Audiotext.

* Short Message Service (SMS)

* WAP over Djuice gateway

* General Packet Radio Service (GPRS)

Djuice is a mobile Internet portal developed by Telenor and adapted with DTAC for the Thai market.

Djuice provides customers with access to information through international and local content providers.

It allows users to organize their information requirements in personal files for easy access. Services

include live stock quotes, news, sports, entertainment, othe information services, and DTAC and third

party e-mail services. Djuice was launched in June 2001 with 20 strategic partners. At end 2001, 60

business partners had contracted with Djuice.

Djuice can also be accessed through GPRS. GPRS utilizes the GSM 2.5G communication platform.

Because this technology uses packet switching, it can operate on an "Always on" basis. Customers are

able to make a voice call and simultaneously receive or send data. DTAC's GPRS is available nationwide

and can currently transmit data at speeds of up to 40 Kbps. This platform will be used to support

advanced data services for individual and corporate customers such as real-time information and mobile

commerce solutions, wireless infrastructure services, mobile intra-net access and location based

services.



No monthly fee5 baht/minute

Flat rate nationwideCharge by per second billing

Easy to refill

Distribution channelsWe currently utilize three principal sales and distribution channels; DTAC shops, third-party dealers and

non- telecom outlets.

DTAC shops: DTAC shops (previously WorldPhone Shops) were first established in 1996. These retail

outlets are exclusive sales outlets for DTAC as well as bill collection and customer service centers. At end

2001 there were 295 DTAC shops . Of these, 12 shops are owned by DTAC and the rest are franchised

operations.

Dealers: As at end 2001, approximately 1,400 primary dealers around the country were contracted with

DTAC as non-exclusive sales outlets. Although these dealers are independent, various cooperative

initiatives are designed to create more attention to, and visibility of the DTAC products.

Non-telecom outlets: This channel is currently primarily used to promote and distribute our prepaid

products. Outlets include convenient stores, supermarkets, bookstores, and gas stations, but could

include any outlet or location that is more convenient for our customers. At end 2001, around 4,000

non-telecom outlets distributed DTAC products.

DTAC Customer Care

We pride ourselves in providing the highest standards of after sales and customer service. This is

currently provided through a nationwide network of service centers and call centers. Service is also

available through a dedicated web site and bill payment can be made through banks, credit cards, ATMs,

pay points and mobile banking Currently, the Company has 18 fixed service centers and 1 mobile

service center around the country. The Company has 5 call centers altogether: 1 in Bangkok and 4

in 4 regions.

D4U program

In December 2001, DTAC introduced an innovative loyalty program called " D4U". This program offers

bonus points to not only postpaid but also prepaid customers. Postpaid customers are automatically

enrolled as a member of our D4U program and are awarded bonus points for spending on airtime, for an

on-time bill payment, for the period of stay with DTAC and for using certain payment points. Prepaid

customers are awarded free initial bonus points when they apply for D4U membership.



and the CommunityAt DTAC we believe that customer satisfaction comes from understand the customer needs and

requirements and the communities and environments in which they live and operate. For instance, there

are many areas of Thailand where peoples lives could be enhanced by telecommunication but the

affordability of such services precludes many potential users from taking up services. Out with the

metropolitan areas, well paying jobs are scarce. Many rely on primary agricultural businesses for income

where relatively small profit margins have to be spread across a distribution system that leaves little profit

for the farmer. As a result, urbanization has been inevitable and has creating a wide gap of income

between Bangkok, and a few other urban centers, and provincial areas.

We recognize the people of these provincial areas as potential customers and are therefore working with

communities in a number of areas by helping people to help themselves to improve the quality of their

lives.

Rak Ban Kerd Project is a social program that aims to build integrated networks through educational

sponsorships that encourages people to return to and help develop their hometowns. The project

sponsors 760 students from 76 provinces (10 students per province) from junior high school or Matayom

1 until university graduate level. 76 new students are added to the program every year at Matayom 1 level.

There is annual meeting between all sponsored students to encourage friendships and the sharing of

ideas. The latest program in the project, in cooperation with UCOM, is "KAI ARSA" or Community

Development Program for all university level students in the program. These graduate students will be

trained to live in and help develop communities for one summer. The project also aims at building

leadership capabilities with a focus on morality, decency and networking of people. The benefit to the

students of this countrywide network will help them successfully develop their hometowns, creating job

opportunities and wealth creation.

Rak Ban Kerd Agricultural Project was established to help convert one million Rais of deserted land

around the country into agricultural producing areas. This project will create jobs for farmers who do not

own land and make them self-sufficient and therefore discouraging them from looking for jobs in cities.

This project is geared towards the families of the Rak Ban Kerd students.

Ruam Duay Chuay Kan Co-op Project helps create wholesale trade channels for farmers around the

country. The network that we build will be used to create businesses for communities as an information

backbone for production co-operatives. It is intended to empower the farmers in the distribution channels.

Rak Ban Kerd Shop is based on a franchise convenient store concept, but modified for a community store.

These stores sell retail goods required by the community using co-op networks around the country. They

will also serve as a retail distribution channels for farmers in each area.

The economic crisis that plagued the country a few years ago taught us the benefits of self-reliance. At

DTAC we have embraced the concept of "Sufficient Economy", as initially promoted by His Majesty the

King. The social activities that we support promoted the development of this philosophy.



Shareholder



StructureTotal Access Communicat ion Plc

Authorized Share Capital : Bht 5,350,010,260

Issued Share Capital : Bht 4,744,161,260

Class of share : Ordinary Shares of Bht 10 each

Voting Rights : One vote per share

Distribution of Shareholdings

Size of Shareholdings No. Of Shareholders % No. of Shares %

1 - 1,000 20,010 99.88 24,207 0.01

1,001- 10,000 5 0.03 17,200 0.00

10,001 - 1,000,000 14 0.06 2,394,786 0.50

1,000,001 and above 4* 0.03 471,979,933 99.49

Total 20,033 100.00 474,416,126 100.00

* Includes CDP nominees (See Details in the Statistics of shareholding in the CDP in Singapore, page 39)

Substantial Shareholdings (Holding 5% and above)

No. of Share %

United Communication Industry Plc 197,538,593 41.64

Telenor Asia Pte Ltd. ** 142,024,800 29.94

Telephone Organization of Thailand 42,829,050 9.03

Note: 19.25% of the issued share is held as part of the public float

** With its 24.85% equity stake in United Communication Industry Plc, Telenor has an additional effective 10.35% indirect share

holding in Total Access Communication Plc.

Ten Largest Shareholders

No. of Share %

1. United Communication Industry Plc 196,700,565 41.46

2. The Central Depository (Pte) Limited*** 231,406,029 48.78

3. Telephone Organization of Thailand 42,829,050 9.03

4. BankThai Public Company Limited 1,044,489 0.22

5. Mr. Surachai Sae - Lim 500,000 0.11

6. Mr. Boonlerd Kaimook 500,000 0.11

7. The Communication Authority of Thailand 500,000 0.11

8. HSBC (Singapore) Nominees Pte., Ltd 262,000 0.06

9. Sub Thawee Two Open-End Fund 121,800 0.03

10. Vickers Ballas & Company Pte., Ltd 109,186 0.02

*** See details on the Statistics of shareholdings in the CDP in Singapore

Information on Share Capital and ShareholdingAs at 21 February 2002Share Capital

Statistics of Shareholdings in the Central Depository in SingaporeAs at 21 February 2002

Distribution of Shareholdings

Size of Shareholdings No. Of Shareholders % No. of Shares %

1 - 1,000 1,132 32.43 783,067 0.34

1,001 - 10,000 2,029 58.12 8,679,100 3.75

10,001 - 1,000,000 323 9.25 15,868,040 6.86

1,000,001 and above 7 0.20 206,075,822 89.05

Total 3,491 100.00 231,406,029 100.00

Twenty Largest Shareholders

No. of Share %

1. Citibank Nominees Singapore Pte. Ltd 151,491,884 65.47

2. DBS Nominees Pte. Ltd. 20,347,685 8.79

3. HSBC (Singapore) Nominee Pte Ltd 16,230,800 7.01

4. Raffles Nominees Pte. Ltd. 8,887,310 3.84

5. United Overseas Bank Nominees Pte Ltd 5,246,600 2.27

6. Morgan Stanley Asia (Singapore) Pte Ltd 2,787,800 1.20

7. Kim Eng Ong Asia Securities Pte Ltd 1,083,743 0.47

8. Oversea-Chinese Bank Nominees Pte Ltd 766,696 0.33

9. Phillip Securities Pte Ltd 751,500 0.32

10.OCBC Securities Private Ltd 746,000 0.32

11. UOB Kay Hian Pte Ltd 675,805 0.29

12. Lee Kang Hock 650,000 0.28

13. DB Nominees (S) Pte Ltd 540,200 0.23

14. DBS Vickers Securities (S) Pte Ltd 462,800 0.20

15. Lim Ai Keng 417,400 0.18

16. Citibank Consumer Nominees Pte Ltd 376,600 0.16

17. G K Goh Stockbrokers Pte Ltd 373,816 0.16

18. Wong Ee Chong 350,000 0.15

19. NTUC Income Insurance Co-Operative Limited 277,000 0.12

20. Lim & Tan Securities Pte Ltd 240,623 0.10

for Shareholders



InformationTotal Access Communicat ion Plc .

DirectorsReportTotal Access Communicat ion Plc .

Investor Relations Department

19th Floor, 333/3 Chai Building, Vibhavadi Rangsit Road.,

Ladyao, Chatuchak, Bangkok 10900

Tel : (66) 2202-8000, Ext. 30964-5, 30968

Fax : (66) 2202-8102-4

E-mail: [email protected]

Website : http://www.DTAC.co.th

Thai Register and Share Registration Office

Thai Farmers Bank Public Company Limited

1 Thai Farmers Lane, Ratburana District,

Bangkok 10140

Tel: (662) 470-1976-83

Registrar for the Singapore Public Offering

and Singapore Share Transfer Agent

Lim Associates (Pte) Ltd

10 Collyer Quay #19-08 Ocean Building

Singapore 049315.

Key Data

Symbol

- Singapore Exchange (SGX) TAC

- Bloomberg Code TAC SP

- Reuters Code TACC.SI

- Exchange Rate (December 31st , 2001) 44.21 Bt@US$

- SET Index (December 31st , 2001) 303.85

- 2000 price range 0.97-3.82 (US$)

- Share Outstanding 474 Million Shares

- Fiscal Year December 31

- Auditor Ernst & Young

Office Limited

The directors present their report to the members together with the audited accounts of the company and

subsidiaries for the financial year ended December 31st, 2001

1. Accounts (in thousand of Thai Baht)

2001 2000

Profit after taxation and minority interests and

profit for the financial year 2,094,961 647,800

In the opinion of the directors, the results of the operations of the Company during the financial year have

not been affected by any item, transaction or event of a material and unusual nature.

2. Transfer to and from reserves and provisions:

There were no material transfers to or from reserves during the financial year except as disclosed in the

accounts.

3. Dividends :

The directors do not propose the payment of a dividend (2000, Nil).

4. Principal activities:

The principal activity of the Company is the provision of wireless communication services and distributing

mobile handsets and related accessories in Thailand. There have been no significant changes in the

nature of these activities during the financial year.

2001 DTAC's Stock Price Performance

2001 Local Currency (THB/USD) Performance

DTAC's Closing Price

SET Index

THB/USD Performance

5

4

3

2

1

0

USD

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec


484746454443424140

THB/

USD


60.00%

40.00%

20.00%

0.00%

-20.00%

-40.00%

-60.00%

-80.00%

-100.00%

% C

hang

e


Director Report


5. Directors:

a. The directors of the Company in office at the date of this report are as follows:

1. Mr. Boonchai Bencharongkul - Chairman of Board of Directors/ Chief Executive Officer

2. Mr. Somlak Sachjapinan - Deputy of Board of Directors/ Chief of Engineering Steering Committee

3. Mr. Vichai Bencharongkul

4. M.R. Tongnoi Tongyai

5. Mr. Chulchit Bunyaketu

6. Mr. Soonthorn Pokachaiyapat

7. Mr. Pakkaporn Sathienpakiranakorn

8. Mrs. Tasanee Manorot

9. Mr. Arve Johansen

10. Mr. Sigve Brekke - Deputy of Board of Directors

11. Mr. Bjorn Magnus Kopperud

b. The following directors who held office at the end of the financial year have, according to the register

required to be kept under Section 164 of the Companies Act, Cap. 50, an interest in the ordinary shares

of the Company and in the shares, debentures and rights of the subsidiaries of the Company's holding

company:

(unit: share)

Name of Director Interest

Mr. Boonchai Bencharongkul 2

Mr. Vichai Bencharongkul 1

6. Related Party Transactions:

Pursuant to the requirements of Chapter 9A of the listing Manual issued by the Singapore Exchange

Securities Trading Limited, the Company has established procedures to identify, report and where

necessary, seek appropriate approval from the Board for related party transactions.

7. Other statutory information:

a. Before the accounts of the Company were finalized, the directors took reasonable steps to ascertain

that proper action had been taken in relation to the writing off for bad debts and the making of provision

for doubtful amounts receivable and satisfied themselves that all known bad debts had been written off

and that adequate provision had been made for doubtful accounts receivable.

b. At the date of this report, the directors are not aware of any circumstances which would render (i) the

amount written off for bad debts or the amount of the provision for doubtful accounts receivable

inadequate to any substantial extent ; and (ii) the values attributed to current assets misleading.

c. At the date of this report, the directors are not aware of any circumstances not otherwise dealt with in

the report of accounts, which would render any amount stated in the accounts of the Company, and the

consolidated accounts misleading.

d.As at the date of this report, (i) there are no charges in the assets of the Company which have arisen

since the end of the financial year to secure the liabilities of any other person: and (ii) there are no

material contingent liabilities which have arisen since the end of the financial year.

e. Other than as set out in 4, above, in the opinion of the directors, no item, transaction or event of a

material and unusual nature has arisen in the interval between the financial year and the date of this

report which is likely to affect substantially the results of the operation of the Company and of the

Group for the financial year in which this report is made.

8. Statutory Auditors:

Ernst&Young, Certified Public Accountants, have expressed their willingness to accept re-appointment as

statutory auditors of the company.

Statement by the directors:

As directors of Total Access Communication Public Company Limited, we, Boonchai Bencharongkul and

Somlak Sachjapinan do hereby state that the accompanying accounts together with the notes there to are

drawn up so as to give a true and fair view of the state of affairs of the Company as at 31 December 2001.

Mr. Boonchai Bencharongkul Mr. Somlak Sachjapinan

Chairman of Board of Directors and Deputy of Board of Directors and

Chief Executive Officer Chief of Engineering Steering Committee

Bangkok, Thailand, February 28, 2002

Annual General Meeting to shareholders:

Date: April 30th 2002

Place: Chai Building, 12th floor, Vibhavadi Rangsit Road, Chatuchak, Bangkok

Audit


CommitteeTotal Access Communicat ion Plc .

M.R. Tongnoi Tongyai

Chairman of the Audit Commitee

Total Access Communication Public Company Limited

To Shareholders,

The Audit Committee has conducted its activities with full responsibility in compliance with the Charter of

the Audit Committee as approved by the Board of Directors. The main duty of the Audit Committee entails

reviewing the Company's financial reporting, corporate governance, and internal control. Meetings of the

Audit Committee have been held monthly throughout the year to review the above issues within the given

authority before submitting its finding to the Board of Directors for consideration and approval.

As regards its performance for the year 2001, the Audit Committee reviewed many issues with

concentration on the followings:

1. The review of the financial statements of the Company and its subsidiaries prior submitting to the

Board of Directors

2. The approval to set up IT Internal Audit division as a part of Internal Audit Department

3. The approval of the audit plan of the Internal Audit Department, including Operational and IT audit

plans, for the year 2001

4. The monitoring of the audit results of the internal auditing control systems as prepared by Internal Audit

Department

5. The review of the effects on the new Telecommunication Services Bill and National Telecommunications

Commission (NTC) on the Company's operations

6. The establishment of guidelines and procedures in various subjects as deemed suitable for good

governance with emphasis on the completion of the Corporate Authority Index

In our opinion, the Company presents the financial statements in conformity with laws and regulations to

disclose and appropriate and adequate information. The Company's operation performance presents good

corporate governance and appropriate internal control systems.

Report


To the Board of Directors and Shareholders of

Total Access Communication Public Company Limited

I have audited the accompanying consolidated balance sheet of Total Access Communication Public Company Limited and

subsidiaries as at 31 December 2001 and the related consolidated statement of earnings, change in shareholders’ equity and cash

flows for the year then ended; and the separate financial statements of Total Access Communication Public Company Limited for the

same period. These financial statements are the responsibility of the management of the Company and subsidiaries as to their

correctness and the completeness of the presentation. My responsibility is to express an opinion on these financial statements

based on my audit. The consolidated financial statements and the separate financial statements of the Company for the year ended

31 December 2000 were audited by another auditor of our firm, who expressed an unqualified opinion on those financial statements

under his report dated 16 February 2001.

I conducted my audit in accordance with generally accepted auditing standards. Those standards require that I plan and

perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An

audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit

also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the

overall financial statement presentation. I believe that my audit provides a reasonable basis for my opinion.

In my opinion, the financial statements referred to above present fairly, in all material respects, the financial position of

Total Access Communication Public Company Limited and subsidiaries, and of Total Access Communication Public Company

Limited as at 31 December 2001 and the result of their operations and cash flows for the year then ended, in accordance with

generally accepted accounting principles.

Rungnapa Lertsuwankul

Certified Public Accountant (Thailand) No. 3516

Ernst & Young Office Limited

Bangkok : 8 February 2002

Report of Independent

Auditor


ASSETS

CURRENT ASSETS

Cash on hand and at banks 32.4 1,863,184,044 4,281,561,761 1,702,968,063 4,063,293,768

Current investments - fixed deposits with banks 1,266,884,082 702,087,861 1,266,761,794 701,967,860

Accounts receivable - trade, net 5 3,865,138,784 2,935,230,050 3,846,124,188 2,909,604,938

Accounts receivable - trade : related parties

Accounts receivable - trade : subsidiaries 6 - - 183,859,250 111,663,998

Accounts receivable - trade : related companies 6 1,190,985,895 742,272,600 1,186,067,141 736,884,560

Advances to related parties

Advances to subsidiaries 6 - - 89,488,125 152,382,610

Advances to related companies 6 75,144,363 106,710,391 73,624,076 106,678,351

Inventories - net 8 1,898,173,706 999,725,735 1,852,136,165 942,845,303

Other current assets

Current portion of account receivable from assignment of right 12 610,467,273 557,504,359 610,467,273 557,504,359

Accounts receivable from forward exchange contracts 7 - 37,098,381 - 37,098,381

Others 9 3,643,774,666 1,894,084,771 3,591,903,106 1,806,115,790

TOTAL CURRENT ASSETS 14,413,752,813 12,256,275,909 14,403,399,181 12,126,039,918

NON-CURRENT ASSETS

Deposit with financial institution 10 16,497,608 16,497,608 16,497,608 16,497,608

Investments in subsidiaries accounted for under equity method 11 - - 173,109,533 356,565,807

Other long-term investments 13 227,325,515 248,280,401 227,325,515 238,280,401

Long - term loans to and amounts due from related parties

Long-term loans to subsidiaries 6 - - 1,376,571,401 1,302,302,462

Amounts due from a subsidiary 6 - - 2,026,636,020 2,217,001,381

Amounts due from related companies 6 31,396,033 20,668,243 30,853,722 9,457,355

Account receivable from assignment of right - net of current portion 12 3,114,201,154 3,401,523,678 3,114,201,154 3,401,523,678

Property, plant and equipment - net 14 5,073,782,864 4,404,234,484 2,975,351,978 2,132,052,003

Deferred right to use of equipment - net 15 55,352,171,115 37,172,750,168 54,716,744,738 36,499,321,066

Equipment under installation 741,777,408 3,462,507,808 741,777,408 3,462,507,808

Other non - current assets

Goodwill 2.2.2 282,813,368 306,971,309 282,813,368 306,971,309

Deposits and prepayment for purchase and installation of equipment 1,005,750,737 1,939,235,893 1,005,750,737 1,939,235,893

Others 16 1,786,924,214 1,813,406,303 1,762,115,862 1,679,407,849

TOTAL NON - CURRENT ASSETS 67,632,640,016 52,786,075,895 68,449,749,044 53,561,124,620

TOTAL ASSETS 82,046,392,829 65,042,351,804 82,853,148,225 65,687,164,538

BalanceTOTAL ACCESS COMMUNICATION PUBLIC COMPANY LIMITED AND ITS SUBSIDIARIESAS AT 31 DECEMBER 2001 AND 2000

Sheets

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

(Unit : Baht)

CONSOLIDATEDCONSOLIDATEDCONSOLIDATEDCONSOLIDATEDCONSOLIDATED COMPANY ONLYCOMPANY ONLYCOMPANY ONLYCOMPANY ONLYCOMPANY ONLY

Note 2001 2000 2001 2000

a n n u a l r e p o r t 2 0 0 1Total Access Communication Plc. 4 7


Sheets

LIABILITIES AND SHAREHOLDERS’ EQUITY

CURRENT LIABILITIES

Short - term loans from financial institutions 18 1,897,262,197 - 1,897,262,197 -

Accounts payable - trade 17 7,917,045,919 1,633,110,920 7,869,204,994 1,549,674,936

Accounts payable - trade : related parties

Accounts payable - trade : subsidiaries 6 - - - 44,350,161

Accounts payable - trade : related companies 6 3,771,287 7,518,650 - 1,724,417

Advances from related companies 6 155,165,024 30,501,709 155,165,024 30,424,053

Current portion of long - term loan from a subsidiary 6 - - 428,803,792 4,801,314,193

Current portion of notes and bonds 22 857,160,000 3,951,180,212 857,160,000 -

Current portion of convertible bonds 23 - 8,325,180,866 - 8,325,180,866

Current portion of provision for the premium payable on

redemption of convertible bonds 23 - 2,646,766,493 - 2,646,766,493

Other current liabilities

Corporate income tax payable 553,787,110 202,641,223 553,787,110 202,641,223

Interest payable 471,112,961 341,102,071 402,659,051 247,114,539

Accrued expenses 807,501,760 220,069,856 780,277,741 202,449,471

Accounts payable - purchase of investments 13 27,120,000 93,000,000 27,120,000 93,000,000

Accounts payable - others 330,258,467 366,492,797 329,827,294 366,492,797

Others 356,291,752 453,286,865 316,089,273 433,114,811

TOTAL CURRENT LIABILITIES 13,376,476,477 18,270,851,662 13,617,356,476 18,944,247,960

NON - CURRENT LIABILITIES

Long - term loan from a subsidiary - net of current portion 6 - - 13,090,642,494 12,433,636,322

Long - term loans - net of current portion 19.2 6,500,000,000 - 6,500,000,000 -

Notes and bonds - net of current portion 22 33,448,940,000 19,033,682,000 20,142,840,000 6,000,000,000

Convertible bonds - net of current portion 23 37,935,000 - 37,935,000 -

Advances received for registration of number 20 9,834,718 83,869,149 9,834,718 83,869,149

Customers’ deposits 21 1,412,911,737 2,253,608,181 1,412,911,737 2,253,608,181

Advance received - other 12 2,750,593,557 2,985,600,690 2,750,593,557 2,985,600,690

Other liabilities 172,408,022 172,408,034 58,105,226 58,105,227

Provision for loss on investments in subsidiaries 11 - - 895,635,699 685,764,921

TOTAL NON - CURRENT LIABILITIES 44,332,623,034 24,529,168,054 44,898,498,431 24,500,584,490

TOTAL LIABILITIES 57,709,099,511 42,800,019,716 58,515,854,907 43,444,832,450


(continue)

(Unit : Baht)


Note 2001 2000 2001 2000



Sheets

SHAREHOLDERS’ EQUITY

Share capital

Registered

535,001,026 ordinary shares of Baht 10 each 5,350,010,260 5,350,010,260 5,350,010,260 5,350,010,260

Issued and fully paid

474,416,126 ordinary shares of Baht 10 each 24 4,744,161,260 4,744,161,260 4,744,161,260 4,744,161,260

Premium on ordinary shares 24 20,808,142,634 20,808,142,634 20,808,142,634 20,808,142,634

Shares of the Company held by a subsidiary 25 (25,400,450) (25,400,450) (25,400,450) (25,400,450)

Retained earnings

Appropriated - statutory reserve 30 318,331,965 318,331,965 318,331,965 318,331,965

Unappropriated (deficit) (1,507,942,091) (3,602,903,321) (1,507,942,091) (3,602,903,321)

(1,189,610,126) (3,284,571,356) (1,189,610,126) (3,284,571,356)

TOTAL SHAREHOLDERS’ EQUITY 24,337,293,318 22,242,332,088 24,337,293,318 22,242,332,088

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY 82,046,392,829 65,042,351,804 82,853,148,225 65,687,164,538


(continue)

(Unit : Baht)


Note 2001 2000 2001 2000


EarningsTOTAL ACCESS COMMUNICATION PUBLIC COMPANY LIMITED AND ITS SUBSIDIARIESFOR THE YEARS ENDED 31 DECEMBER 2001 AND 2000

Statements

OPERATING REVENUES

Revenue from telephone services 22,028,476,511 15,865,870,545 22,028,476,511 15,865,870,545

Revenue from sales of telephone sets 7,051,841,049 4,920,767,152 7,051,841,049 4,930,415,917

Revenue from sales of retail goods 439,858,963 469,861,472 - -

Other operating income 28 579,355,135 1,607,088,567 427,638,486 1,422,507,909

TOTAL OPERATING REVENUES 30,099,531,658 22,863,587,736 29,507,956,046 22,218,794,371

COST OF SALES AND SERVICES

Cost of telephone services 11,066,597,488 7,364,323,950 11,068,939,534 7,369,333,767

Cost of sales of telephone sets 6,748,216,266 4,282,319,191 6,730,763,120 4,296,524,840

Cost of sales of retail goods 336,563,502 379,905,811 - -

TOTAL COST OF SALES AND SERVICES 18,151,377,256 12,026,548,952 17,799,702,654 11,665,858,607

GROSS PROFIT 11,948,154,402 10,837,038,784 11,708,253,392 10,552,935,764

SELLING AND ADMINISTRATIVE EXPENSES (6,786,195,033) (4,735,856,564) (6,232,901,708) (4,239,299,630)

OPERATING PROFIT 5,161,959,369 6,101,182,220 5,475,351,684 6,313,636,134

INTEREST INCOME 485,186,612 505,945,433 485,328,810 512,756,101

OTHER INCOME 85,534,621 442,781,123 85,042,653 217,666,119

FOREIGN EXCHANGE GAIN (LOSS) 345,051,113 (2,697,603,805) 435,044,600 (2,265,983,624)

NET OPERATING PROFIT 6,077,731,715 4,352,304,971 6,480,767,747 4,778,074,730

SHARE OF LOSS FROM INVESTMENTS IN SUBSIDIARIES

ACCOUNTED FOR UNDER EQUITY METHOD - - (393,327,082) (399,634,872)

EARNINGS BEFORE FINANCIAL COST AND INCOME TAX 6,077,731,715 4,352,304,971 6,087,440,665 4,378,439,858

FINANCIAL COST 26 (3,122,431,480) (3,269,715,237) (3,140,716,709) (3,303,912,687)

CORPORATE INCOME TAX 27 (860,339,005) (434,789,486) (851,762,726) (426,726,923)

NET EARNINGS FOR THE YEAR 2,094,961,230 647,800,248 2,094,961,230 647,800,248

BASIC EARNINGS PER SHARE

Net earnings 4.42 1.5 4.42 1.5

Weighted average number of ordinary shares 474,416,126 shares 432,170,224 shares 474,416,126 shares 432,170,224 shares

DILUTED EARNINGS PER SHARE

Net earnings 4.42 1.5 4.42 1.5

Weighted average number of ordinary shares 474,416,126 shares 432,170,224 shares 474,416,126 shares 432,170,224 shares


(Unit : Baht)


Note 2001 2000 2001 2000


The

acco

mpa

nyin

g no

tes

are

an i

nteg

ral

part

of

the

finan

cial

sta

tem

ents

.

(Uni

t :

Bah

t)

CO

NS

OLI

DAT

ED

Ret

aine

d ea

rnin

gs (

defic

it)

Issu

ed a

ndSh

ares

of

the

Appr

opri

ated

paid

- up

Prem

ium

on

Com

pany

hel

dst

atut

ory

Not

esh

are

capi

tal

ordi

nary

sha

res

by a

sub

sidi

ary

rese

rve

Una

ppro

pria

ted

Tota

l

Bal

ance

- b

egin

ning

of

year

200

04

,04

4,1

61

,26

01

1,1

66

,51

9,0

09

(1,9

72

,87

7,7

10

)3

18

,33

1,9

65

(2,3

03

,22

6,3

09

)1

1,2

52

,90

8,2

15

Rec

lass

ifica

tion

of a

ccou

nts

4 -

-1

,94

7,4

77

,26

0-

(1,9

47

,47

7,2

60

)-

Bal

ance

- b

egin

ning

of

year

200

0, a

s re

stat

ed4

,04

4,1

61

,26

01

1,1

66

,51

9,0

09

(25

,40

0,4

50

)3

18

,33

1,9

65

(4,2

50

,70

3,5

69

)1

1,2

52

,90

8,2

15

Shar

e ca

pita

l in

crea

se2

47

00

,00

0,0

00

- -

--

70

0,0

00

,00

0

Shar

e pr

emiu

m i

ncre

ase

24

-9

,64

1,6

23

,62

5 -

--

9,6

41

,62

3,6

25

Net

ear

ning

s fo

r th

e ye

ar 2

000

- -

--

64

7,8

00

,24

86

47

,80

0,2

48

Bal

ance

- e

nd o

f ye

ar 2

000

4,7

44

,16

1,2

60

20

,80

8,1

42

,63

4(2

5,4

00

,45

0)

31

8,3

31

,96

5(3

,60

2,9

03

,32

1)

22

,24

2,3

32

,08

8

Net

ear

ning

s fo

r th

e ye

ar 2

001

- -

--

2,0

94

,96

1,2

30

2,0

94

,96

1,2

30

Bal

ance

- e

nd o

f ye

ar 2

001

4,7

44

,16

1,2

60

20

,80

8,1

42

,63

4(2

5,4

00

,45

0)

31

8,3

31

,96

5(1

,50

7,9

42

,09

1)

24

,33

7,2

93

,31

8

Sta

tem

en

ts o

f

TOTA

L AC

CES

S C

OM

MU

NIC

ATIO

N P

UB

LIC

CO

MPA

NY

LIM

ITED

AN

D I

TS S

UB

SID

IAR

IES

FOR

TH

E YE

ARS

END

ED 3

1 D

ECEM

BER

200

1 AN

D 2

000

Ch

an

ge

s in

Sh

are

ho

lde

rs’ E

qu

ity


The

acco

mpa

nyin

g no

tes

are

an i

nteg

ral

part

of

the

finan

cial

sta

tem

ents

.

(Uni

t :

Bah

t)

CO

MPA

NY

ON

LY

Ret

aine

d ea

rnin

gs (

defic

it)

Issu

ed a

ndSh

ares

of

the

Appr

opri

ated

paid

- up

Prem

ium

on

Com

pany

hel

dst

atut

ory

Not

esh

are

capi

tal

ordi

nary

sha

res

by a

sub

sidi

ary

rese

rve

Una

ppro

pria

ted

Tota

l

Bal

ance

- b

egin

ning

of

year

200

04

,04

4,1

61

,26

01

1,1

66

,51

9,0

09

(1,9

72

,87

7,7

10

)3

18

,33

1,9

65

(2,3

03

,22

6,3

09

)1

1,2

52

,90

8,2

15

Rec

lass

ifica

tion

of a

ccou

nts

4 -

-1

,94

7,4

77

,26

0-

(1,9

47

,47

7,2

60

)-

Bal

ance

- b

egin

ning

of

year

200

0, a

s re

stat

ed4

,04

4,1

61

,26

01

1,1

66

,51

9,0

09

(25

,40

0,4

50

)3

18

,33

1,9

65

(4,2

50

,70

3,5

69

)1

1,2

52

,90

8,2

15

Shar

e ca

pita

l in

crea

se2

47

00

,00

0,0

00

- -

--

70

0,0

00

,00

0

Shas

re p

rem

ium

inc

reas

e2

4 -

9,6

41

,62

3,6

25

--

-9

,64

1,6

23

,62

5

Net

ear

ning

s fo

r th

e ye

ar 2

000

- -

--

64

7,8

00

,24

86

47

,80

0,2

48

Bal

ance

- e

nd o

f ye

ar 2

000

4,7

44

,16

1,2

60

20

,80

8,1

42

,63

4(2

5,4

00

,45

0)

31

8,3

31

,96

5(3

,60

2,9

03

,32

1)

22

,24

2,3

32

,08

8

Net

ear

ning

s fo

r th

e ye

ar 2

001

- -

--

2,0

94

,96

1,2

30

2,0

94

,96

1,2

30

Bal

ance

- e

nd o

f ye

ar 2

001

4,7

44

,16

1,2

60

20

,80

8,1

42

,63

4(2

5,4

00

,45

0)

31

8,3

31

,96

5(1

,50

7,9

42

,09

1)

24

,33

7,2

93

,31

8

(co

ntin

ue

)

Sta

tem

en

ts o

f

TOTA

L AC

CES

S C

OM

MU

NIC

ATIO

N P

UB

LIC

CO

MPA

NY

LIM

ITED

AN

D I

TS S

UB

SID

IAR

IES

FOR

TH

E YE

ARS

END

ED 3

1 D

ECEM

BER

200

1 AN

D 2

000

Ch

an

ge

s in

Sh

are

ho

lde

rs’ E

qu

ity


Cash flows from (used in) operating activities

Net earnings 2,094,961,230 647,800,248 2,094,961,230 647,800,248

Adjustments to reconcile net earnings to net cash

provided by (paid from) operating activities :-

Share of loss from investments in subsidiaries

accounted for under equity method - - 393,327,082 399,634,872

Provision for inventory obsolescence 104,027,400 93,417,571 107,556,676 95,689,437

Provision for declining in value of inventories 20,000,000 - 20,000,000 -

Provision for impairment loss of fixed assets 41,487,315 31,115,486 41,487,315 31,115,486

Provision for doubtful accounts : account receivable-trade

related companies 17,288,382 26,440,188 17,288,382 -

Provision for doubtful accounts : account receivable - TOT 245,137,620 302,175,468 245,137,620 302,175,468

Provision for doubtful accounts : long-term loans to and

amount due from related parties 6,219,363 2,933,729 - 2,933,729

Provision for doubtful accounts : advances to related companies 57,047,552 6,168,180 57,047,552 6,168,180

Provision for diminution in value of other long-term investments 21,000,000 44,333,381 11,000,000 44,333,381

Gain on sale of investment in former associated company - (247,716,437) - (119,796,437)

Loss from write off : long - term loan to a subsidiary - - - 72,080,000

Gain from repurchases of convertible bonds (54,562,675) (16,064,159) (54,562,675) (16,064,159)

Loss on sale of investment in a subsidiary 10,000,000 - - -

Exchange loss from long-term loan repayments - 598,436,472 - 598,436,472

Exchange loss from repurchases of convertible bonds - 232,079,853 - 232,079,853

Depreciation and amortisation 3,881,233,830 3,737,735,091 3,613,379,490 3,516,759,979

Amortisation of goodwill 24,157,941 24,224,126 24,157,941 24,224,126

Amortisation of advance received - other (235,007,133) (235,658,572) (235,007,133) (235,658,572)

Provision for the premium payable on redemption of the

convertible bonds 320,959,602 694,532,960 320,959,602 694,532,960

Exchange gain from convertible bonds redemption

from exercising the put option (174,090,941) - (174,090,941) -

Unrealised exchange gain/loss : long - term loan to a subsidiary - - (74,268,939) (441,670,030)

Unrealised exchange gain/loss : receivable from assignment of right - (135,514,999) - (135,514,999)

Unrealised exchange gain/loss : long-term loan from a subsidiary - - 269,737,790 1,904,517,962

Unrealised exchange gain/loss : notes and bonds 269,737,790 1,900,942,212 - -

Unrealised exchange gain/loss : provision for the premium

payable on redemption of the convertible bonds - 124,769,007 - 124,769,007

Unrealised exchange gain/loss - convertible bonds - 464,161,735 - 464,161,735

Unrealised exchange gain/loss - forward exchange contracts - (37,098,381) - (37,098,381)

6,649,597,276 8,259,213,159 6,678,110,992 8,175,610,317

Decrease (increase) in operating assets

Accounts receivable - trade, net (929,908,734) (240,744,689) (936,519,250) (579,314,171)

Accounts receivable - trade : subsidiaries - - (72,195,252) 788,264,485

Accounts receivable - trade : related companies (466,001,677) (354,688,733) (466,470,963) (373,548,434)

Advances to subsidiaries - - 62,894,485 26,210,926

Advances to related companies (25,481,524) 36,691,465 (23,993,277) 35,580,298

Inventories (1,002,475,371) (391,757,449) (1,016,847,538) (919,449,953)

Other current assets (1,994,827,515) (756,164,650) (2,030,924,936) (780,150,734)

Statements of

TOTAL ACCESS COMMUNICATION PUBLIC COMPANY LIMITED AND ITS SUBSIDIARIESFOR THE YEARS ENDED 31 DECEMBER 2001 AND 2000

Cash Flows


Statements ofCash Flows

(Unit : Baht)


2001 2000 2001 2000



Statements of

TOTAL ACCESS COMMUNICATION PUBLIC COMPANY LIMITED AND ITS SUBSIDIARIESFOR THE YEARS ENDED 31 DECEMBER 2001 AND 2000

Cash FlowsStatements of

Cash Flows(continue)

Increase (decrease) in operating liabilities

Accounts payable - trade 799,538,593 650,378,256 835,133,652 858,836,349

Accounts payable - trade : subsidiaries - - (44,350,161) 26,449,572

Accounts payable - trade : related companies (3,747,363) (65,234,579) (1,724,417) (54,784,801)

Advances from related companies 124,663,315 (3,024,119) 124,740,971 2,432,694

Other current liabilities 913,389,211 265,987,820 908,857,581 473,298,001

Advances received for registration of number (74,034,431) (12,987,691) (74,034,431) (12,978,691)

Customers’ deposits (840,696,444) (354,355,819) (840,696,444) (354,355,819)

Net cash from operating activities 3,150,015,336 7,033,312,971 3,101,981,012 7,312,100,039

Cash flows from (used in) investing activities

Decrease in deposits with maturity of more than 3 months

or have commitment 396,463 38,019,687 - -

Receipt from account receivable from assignment of right 234,359,610 167,415,271 234,359,610 167,415,271

Sale of investment in former associated company - 447,716,437 - 447,716,437

Sale of investment in a subsidiary 20,000,000 - - -

Decrease (increase) in other long-term investments (45,114) 530,088 (45,114) 40,088

Decrease in amounts due from subsidiaries - - 190,365,361 17,432,575

Decrease (increase) in amounts due from related companies (16,947,153) 29,027,860 (21,396,367) (5,884,378)

Decrease in long - term loan to a subsidiary - - - 802,655,682

Acquisition of property, plant and equipment (1,366,480,453) (638,172,767) (1,382,908,152) (670,997,600)

Acquisition of deferred right to use of equipment and

equipment under installation (12,650,409,141) (4,725,892,633) (12,650,409,141) (4,725,892,633)

Decrease (increase) in deposits for purchase of equipment 933,485,156 (1,887,966,415) 933,485,156 (1,887,966,415)

Increase in other non - current assets (516,093,604) (383,430,851) (522,755,984) (399,253,761)

Net cash used in investing activities (13,361,734,236) (6,952,753,323) (13,219,304,631) (6,254,734,734)

Cash flows from (used in) financing activities

Receipt of short - term loans from financial institutions 1,897,262,197 - 1,897,262,197 -

Increase (decrease) in long - term loan from a subsidiary - - (36,742,019) 29,156,739

Repayment of convertible bonds from exercising the put option (10,603,770,651) - (10,603,770,651) -

Repayment of long-term loans - (12,213,502,492) - (12,213,502,492)

Repayment of long-term loan from a subsidiary - - (3,948,500,000) -

Repayment of notes and bonds (3,948,500,000) - - -

Drawn down of long - term loans 6,500,000,000 - 6,500,000,000 -

Payment of repurchase of the convertible bonds (486,457,679) (2,240,654,333) (486,457,679) (2,240,654,333)

Proceeds from Thai Baht debentures 15,000,000,000 6,000,000,000 15,000,000,000 6,000,000,000

Proceeds from share capital increase - 10,341,623,625 - 10,341,623,625

Net cash from financing activities 8,358,533,867 1,887,466,800 8,321,791,848 1,916,623,539

Net increase (decrease) in cash and cash equivalents (1,853,185,033) 1,968,026,448 (1,795,531,771) 2,973,988,844

Cash and cash equivalents at beginning of year 4,946,298,270 2,978,271,822 4,765,261,628 1,791,272,784

Cash and cash equivalents at end of year (Note 31) 3,093,113,237 4,946,298,270 2,969,729,857 4,765,261,628

Supplemental cash flow information :-

Cash paid during the year for :-

Interest 2,671,460,988 2,177,085,759 2,664,212,595 2,214,369,271

Corporate income tax 562,375,198 458,252,956 553,628,909 405,328,913

(Unit : Baht)


2001 2000 2001 2000


Note to Financial

TOTAL ACCESS COMMUNICATION PUBLIC COMPANY LIMITED AND ITS SUBSIDIARIES

Statements

1. BASIS OF CONSOLIDATION

The consolidated financial statements include the financial statements for the years ended 31 December 2001 and 2000 of Total Access Communication

Public Company Limited (“the Company”) and subsidiaries as follows :-

Percentage of shareholding Nature of business

2001 2000

Subsidiaries directly held by the Company

WorldPhone Shop Company Limited 100 100 Operate”am/pm” shops

TAC Property Company Limited 100 100 Asset management

TAC Investment Limited 100 100 Holding company (registered in

Western Samoa and presented

financial statements in US Dollars)

TAC Service Company Limited 100 100 Provide customer services for paging

customers (ceased operation in 2001 )

Subsidiaries held through TAC Property Company Limited

Eastern Beach Company Limited 100 100 Land development

TAC Finance Company B.V. 100 100 Finance company (registered in

Netherlands and presented financial

statements in US Dollars)

Viphavadee Office Building Company Limited 100 100 Property development (office building)

Piyanee Company Limited - 100 Has not yet operated

Material intercompany balances and transactions are eliminated from the consolidated financial statements. Book value of investments in subsidiaries in the

Company’s financial statements and shareholders’ equity of the subsidiaries are eliminated from the consolidated financial statements.

Assets and revenues of the Company which are included in the consolidated financial statements constitute 96 and 98 percent of the consolidated totals,

respectively (2000 : 95 and 97 percent, respectively).

The financial statements of Viphavadee Office Building Co., Ltd., of which the assets as at 31 December 2001 of Baht 629 million included in the consolidated

financial statements and the provision for loss on investment in this subsidiary as at 31 December 2001 of Baht 62 million, accounted for under equity method,

included in the Company’s financial statements, was audited by other auditor. The amounts included for this subsidiary in the consolidated financial state-

ments is based solely on the report of the other auditor.

2. GENERAL INFORMATION

2.1 Company’s informationThe Company was incorporated as a public limited company under Thai law and listed on the Stock Exchange of Singapore in 1995. The Company

operates its business in Thailand and principally engages in operating wireless telecommunication services and distributing handset and accessories.

The Company’s registered address is 333/3 Chai Building, Vibhavadi Rangsit Road, Ladyao, Chatuchak, Bangkok.


2.2 Agreements to operate cellular telephone services

2.2.1 On 14 November 1990, the Company entered into an agreement with The Communications Authority of Thailand (“CAT”) to operate cellular

telephone services. In operating under the Cellular Telephone Service Agreement with CAT, the Company has an obligation to transfer the

operating assets to CAT without charge. Value added tax imposed on the assets as transferred is charged to CAT and recorded as “Value added

tax refundable from CAT” in the balance sheet.

The concession originally covered a 15-year period but the agreement was amended on 23 July 1993 and 22 November 1996 when the conces-

sion period was extended to 22 years and 27 years, respectively. The rate and fee charged to subscribers are subject to approval from CAT. The

Company is obliged to comply with the conditions and pay a fee to CAT in accordance with the agreement.

The fee is based on the greater of a minimum annual payment and a percentage of revenues from services on the following basis :-

(Unit : Million Baht)

Year Percent per annum Minimum Annual Payment

1 - 4 12 22 to 154

5 25 353

6 - 15 20 382 to 603

16 - 20 25 748 to 770

21 - 27 30 752 to 1,200

The Company commenced commercial operations on 16 September 1991.

2.2.2 On 9 November 1995, the Company entered into an agreement with The Telephone Organisation of Thailand (“TOT”) to allow TOT to hold ordinary

shares of the Company. The Company issued 42,829,050 new shares to TOT at par value of Baht 10 each. TOT was not required to pay for the

shares (The Company regarded the transaction as beneficial to the Company on a long-term basis from an operational image and perspective,

therefore the cost of shares was recorded as “Goodwill” and is subject to amortisation over the remaining concession period with CAT).

As a result of the transaction, TOT agreed to reduce certain fees payable by the Company. The reduction is made on the fee to be paid by the

Company to CAT under the concession agreement (on the portion that CAT has to share to TOT) as follows :-


Year ended Fee reduction

15 September 1995 173



15 September 1998 to 2011 827 (per year)



Under the agreement, if TOT wishes to sell the shares within 3 years from the date it received them, the Company is required to find parties to

acquire the shares from TOT, at the price specified in the agreement. On 22 September 1998, the TOT advised the Company to arrange for the

sale of such shares, in accordance with the agreement. The Company is currently still in the process of seeking investors.


2.2.3 Assignment of rights and obligations under an agreement to operate cellular telephone services with Wireless Communications Services

Company Limited.

On 19 June 1996, the Company, CAT and Wireless Communications Services Company Limited (“WCS”) entered into an agreement to assign the

rights and obligations under the Agreement to Operate Cellular Telephone Services. With the consent of CAT, the Company assigned and

transferred to WCS a certain portion of the Company’s rights and obligations to operate a cellular telephone service (Digital PCN 1800). The

Company agreed to terminate the Agreement on the Appointment of Agent to provide cellular telephone service (Digital PCN 1800) with The

International Engineering Public Company Limited (“IEC”) prior to 16 June 1997 or on such earlier date that WCS was ready to commence

commercial operations.

On 20 June 1996, the Company, IEC and WCS entered into a Shareholders Agreement which included the following conditions :-

( A ) The Company would own 45 percent of WCS’s share capital.

(B ) The subscribers as attributable to IEC under the Agreement on the Appointment of Agent would be transferred from the Company to IEC

and then IEC would transfer them free of charge to WCS. The Company would receive approximately Baht 1,500 million from IEC for this

purpose. (The Company recognised this amount in the earnings statements as other income (net of related expenses), proportionately

based on number of subscribers as attributable to IEC. All of this amount had been recognised as other income during 1996 and 1997.)

( C ) The Company would receive approximately Baht 2,250 million from WCS as consideration for allowing WCS to use the Company’s

network and facilities and the transfer of part of the rights and obligations to operate the cellular telephone service to WCS. (The

Company recognised this amount in the earnings statement as a reduction against cost of providing service until 1998.)

On 6 September 1996, the Company transferred 20,000,000 shares in WCS (20 percent) to TAC Investment Limited, a subsidiary.

On 28 April 1997, the Company and the subsidiary sold 25,000,000 shares in WCS (25 percent) to an investor.

WCS commenced commercial operations on 28 May 1997.

In April 1998, the Company took over collections from the customers of WCS, and has recognised such collections as revenues since that time.

The Company stopped recognising the consideration receivable from WCS in the third quarter of 1998, and set up a full provision for the

consideration receivable. The Company entered into a Restructuring Agreement with WCS and WCS’s shareholders, under which a conditional

waiver of WCS’s obligations to the Company was provided and WCS’s subscribers were transferred to the Company. However, as a result of the

transfer of WCS’s subscribers, the Company has incurred obligations totalling approximately Baht 88 million for the repayment of deposits to

customers who may cancel their service agreements in the future. No provision for the obligation has been recorded in the accounts since the

Company expects to be able to claim the amounts from the company that received the deposits from the customers.

On 10 April 1998, the Company entered into an “Airtime Provider Agreement” with IEC to allow IEC to provide services as specified in the

agreement. IEC can provide services to existing customers that IEC has obtained under a Marketing Provider Agreement with WCS until 10 April

1998 and new customers that IEC obtained under this agreement since 11 April 1998. IEC receives a fee based on a percentage on revenues

from telephone services.

On 14 February 2000, 8 million WCS shares, which a subsidiary had received in part payment of an account receivable for the sale of an

investment, were transferred to the Company in payment of debt totalling approximately Baht 200 million.

On 22 February 2000, the Company sold 28 million WCS shares to a third party and no longer has an interest in WCS, with a gain of Baht 247

million on the sale of these shares (in the consolidated financial statements).


2.2.4 Assignment of rights and obligations under an agreement to operate cellular telephone services with Digital Phone Company Limited

On 19 November 1996, the Company, CAT and Digital Phone Company Limited (“DPC”) entered into an agreement to assign the rights and

obligations under the Agreement to Operate Cellular Telephone Services. With the consent of CAT, the Company assigned and transferred to DPC

a certain portion of the Company’s rights and obligations to operate a cellular telephone service (Digital PCN 1800). The Company agreed to

terminate the Agreement on the Appointment of Agent to provide the cellular telephone service (Digital PCN 1800) with Samart Corporation

Public Company Limited (“Samart”) prior to 16 March 1998 or on such earlier date that DPC was ready to commence commercial operations.

On 7 January 1997, the Company, Samart and DPC entered into a Shareholders Agreement and other relevant agreements which include the

following conditions :-

(a) The Company will receive approximately Baht 5,400 million from DPC as consideration for allowing DPC to use the Company’s network

and facilities and the transfer to DPC of part of the rights and obligations to operate the cellular telephone service. The Company

recognises this amount in the earnings statement as a reduction against cost of providing service evenly over the remaining concession

period.The amount recognised in 2001 and 2000 was Baht 235 million and Baht 236 million, respectively.

(b) The Company paid approximately Baht 1,238 million to Samart as an advance received from Samart under the Service Provider Agree-

ment due to the termination.

( c ) The Company received from Samart as a gain operating profits during the period from the commencement of the Service Provider

Agreement until the termination date. The Company recognised the amount in the earnings statements as other income in 1997 and

1998.

On 9 October 1998, the Company entered into an Amendment Agreement to the Unwind Agreement to receive early payment a certain amounts

before the repayment date in the Unwind Agreement in return forgiving discount on the consideration due of approximately USD 10 million and

rescheduled the repayment of the balance of the consideration.

DPC commenced commercial operations on 16 March 1998.

3. SIGNIFICANT ACCOUNTING POLICIES

The financial statements have been prepared in accordance with the Thai accounting standards pronounced by the Institute of Certified Accountants and

Auditors of Thailand and with the Accounting Act B.E. 2543. Such Thai standards are based on and similar to those issued by the International Accounting

Standards Committee (IASC) except for accounting for income taxes, accounting for employee benefits and accounting for financial instruments : recognition

and measurement, which are not applied under the Thai standards and certain disclosures which are not required to be made under the Thai standards.

Significant accounting policies adopted by the Company and subsidiaries are summarised below :-

3.1 Revenue recognitionRevenue from telephone service is recognised as income when service has been rendered. Revenues from sales and service are the invoiced value of

goods supplied and service rendered after deducting discounts. Revenue is shown excluding value added tax.

3.2 InvestmentsInvestments in subsidiaries (in the financial statements of the Company only) are accounted for under the equity method. Losses in excess of costs of

investments is presented as liabilities under the caption “Provision for loss on investments in subsidiaries”.


Other long-term investments in marketable securities which the Company intends to hold as available-for-sale, are held at fair value. Gain or loss arising

from changes in the value of such investment is separately shown in shareholders’ equity under the caption “Unrealised gain/loss on changes in the value

of investments”.

Other long-term investments in non-marketable equity securities, which the Company holds as other investments, are valued at cost.

Loss on impairment of available-for-sale securities and other investments are recognised in the earnings statements in the period in which the loss arises.

3.3 Inventories

Inventories are valued at the lower of cost (moving average and first-in, first-out basis) and net realisable value.

3.4 Allowance for doubtful accounts

Allowance for doubtful accounts is provided for as the estimated collection losses that may be incurred in the collection of receivables. The allowance is

based on collection experience and the current status of receivables outstanding at the balance sheet date.

3.5 Property, plant and equipment/depreciation

Property is stated at cost. Plant and equipment are stated at cost less accumulated depreciation. The cost of an asset comprises its purchase price and

any directly attributable costs of bringing the asset to working condition for its intended use. Expenditure for additions, improvements and renewals are

capitalised and expenditure for maintenance and repairs are charged to the earnings statements. When assets are sold or retired, their cost and

accumulated depreciation are removed from the accounts and any gain or loss resulting from their disposal is included in the earnings statements.

Depreciation of buildings and equipment is calculated by reference to their cost on a straight-line basis over the following estimated useful lives :-

Buildings 20 years

Building improvement 5 -15 years

Leasehold right over the period of lease

Equipment for supporting Cellular

Telephone Services Concession period and 10 years

Cell site improvement 20 years

Others 5 years

No depreciation is provided for land, building in progress, work in progress and equipment under installation.

3.6 Amortisation

Deferred right to the use of equipment is amortised on a straight-line basis over the concession period.

Deferred charges, which are mainly software development and software fees, loan arrangement fees and bond underwriting fees, are amortised on a

straight-line basis over a period of 2 to 10 years.

Cost for right to operate the “am/pm” shops are amortised on a straight-line basis over the remaining period of the Licensing Agreement (7.5 years).


3.7 Foreign currencies

Foreign currency transactions during the year are translated into Thai Baht at the exchange rates ruling on the transaction dates. Assets and liabilities

denominated in foreign currency outstanding on the balance sheet date are translated into Thai Baht at the exchange rates ruling on the balance sheet

date, with the exception of those covered by forward exchange contracts, which have accounted for at the contracted rate. Exchange gains and losses

are included in the earnings statements.

Discounts or premiums, the difference between the spot exchange rate and the forward exchange rate at the inception of the contract, are deferred and

amortised to earnings over the contract period using the straight-line method.

3.8 Taxation

Corporate income tax is recorded as an expense as the amount payable for the year (corporate income tax rate in Thailand is currently 30 percent of

taxable earnings).

3.9 Earnings per share

Basic earnings per share is calculated by dividing the net earnings for the year by the weighted average number of ordinary shares in issue during the

year.

Diluted earnings per share is calculated by dividing net earnings for the year, after adjusting for the effect of transactions with dilutive potential to

ordinary shares, by the total sum of the weighted average number of ordinary shares in issue during the year and the weighted average number of ordinary

shares to be issued for conversion of all dilutive potential ordinary shares into ordinary shares.

4. RECLASSIFICATION OF ACCOUNTS

At 31 December 2000 the Company had treasury stock of Baht 1,972 million which was separately presented in the financial statements as “Shares of

the Company held by a subsidiary” in the shareholders’ equity. This amount included losses amounting to Baht 1,947 million from sales of such stock. In

the fourth quarter of 2001, the Institute of Certified Accountants and Auditors of Thailand (ICAAT) issued a new guideline regarding the recording of

treasury stock which requires that the losses from sales of treasury stock be charged directly to retained earnings and that the treasury stock account

include only treasury stock which has not yet been sold. This is effective for financial statements of accounting periods ended on or after 31 December

2001. As a result, the Company has amended it accounting policy accordingly and has adjusted the losses from sales of such stock against the beginning

balance of retained earnings and restated the previous year’s financial statements presented herein for comparative purposes. This is regarded as a

change in accounting standards made in conformity with the newly issued ICAAT guideline. This accounting change has no effect on shareholders’ equity

as it involves only a reclassification of account.


5. ACCOUNTS RECEIVABLE - TRADE

(Unit : Baht)

CONSOLIDATED COMPANY ONLY

2001 2000 2001 2000

Accounts receivable

- telephone services 4,072,642,804 2,640,755,782 4,072,642,804 2,640,755,782

Accounts receivable

- sales of telephone sets 424,334,838 340,897,335 408,898,319 313,852,374

Accounts receivable - others 96,995,072 209,516,041 41,494,940 161,972,350

Total 4,593,972,714 3,191,169,158 4,523,036,063 3,116,580,506

Less : Allowance for doubtful

accounts (728,833,930) (255,939,108) (676,911,875) (206,975,568)

Net 3,865,138,784 2,935,230,050 3,846,124,188 2,909,604,938

Aging of accounts receivable - telephone services are as follows :-

(Unit : Thousand Baht)

2001 2000

Less than 1 months 2,737,795 2,282,010

1 month to 3 months 445,458 110,721

3 months to 5 months 313,476 63,477

Over 5 months 575,914 184,548

Total 4,072,643 2,640,756

Less : Allowance for doubtful accounts (635,645) (197,105)

Net 3,436,998 2,443,651

The Company has set up the allowance for doubtful accounts after consideration of customer deposits and collection experience. In addition, as from second

quarter 2001, the Company has revised its policy to set up allowance for doubtful accounts as a certain percentage of revenue from telephone services and

to provide against the balance of all accounts receivable - telephone services which are outstanding more than 150 days.

Aging of accounts receivable - sales of telephone sets are as follows :-



2001 2000 2001 2000

Accounts receivable - dealers

Less than 1 month 353,049 212,115 353,049 212,115

1 month to 3 months 7,582 39,396 7,582 39,396

Over 3 months 48,535 63,486 48,267 62,341

409,166 314,997 408,898 313,852

Accounts receivable - hire

purchase (net of deferred interest) 15,169 25,900 - -

Total 424,335 340,897 408,898 313,852

Less : Allowance for doubtful accounts (40,393) (29,478) (24,956) (9,871)

Net 383,942 311,419 383,942 303,981


6. RELATED PARTY TRANSACTIONS

The Company and its subsidiaries enter into business transactions with each other and with their related companies, principally in respect of the purchase and

sales of goods, the rendering and receiving of services, cash advances and loans.These companies are related through shareholding and directorships. Such

transactions have been concluded on the terms and basis determined by the Company and those related companies and in the normal course of business, as

summarised below :-


CONSOLIDATED COMPANY ONLY Pricing Policy

2001 2000 2001 2000

Transactions with subsidiaries

(eliminated from the consolidated

financial statements)

Sales of goods - - 50 50 market price

Service income - - - 13 market price (numbering fee)

Interest income - - 2 23 (1)

Purchases of goods - - - 675 at cost

Service expenses - - 89 127 cost plus margin 10 percent

Interest expense - - 635 631 (2)

Transactions with related company : United Communication Industry Plc. ( “UCOM” )

Sales of goods 3,766 1,787 3,766 1,787 price determined by the

parties concerned which nearly cost

Service income 206 303 206 303 market price (numbering fee)

Purchases of goods 1,524 445 1,524 445 Handsets : cost plus 0.5 percent margin

Equipment : cost plus 7-15 percent

margin

Promotion subsidy expenses - 48 - 48 price determined by the

parties concerned.

Service expenses 256 70 256 70 cost plus 7-15 percent margin ,

agreement

Credit notes for return of

numbering fee 323 - 323 - See note 28

Transactions with other related companies

Purchase of goods 98 8 98 8 cost plus certain margin

Service expenses 367 312 367 312 cost plus certain margin, agreement

Service fees for installation of 820 - 820 - agreement

cell site equipment


The significant outstanding balances arising from the above transactions as separately presented in the balance sheets comprised the following :-

(Unit : Baht)


2001 2000 2001 2000

Accounts receivable - trade : subsidiaries

WorldPhone Shop Co., Ltd. - - 183,852,550 111,663,998

Others - - 6,700 -

- - 183,859,250 111,663,998

Accounts receivable - trade : related companies

United Communication Industry Plc. 1,132,766,849 590,766,713 1,132,766,849 590,766,713

United Communication Subscribers Co., Ltd. 68,487,983 68,487,983 68,487,983 68,487,983

Less : Allowance for doubtful account (17,288,382) - (17,288,382) -

51,199,601 68,487,983 51,199,601 68,487,983

United Information Highway Co., Ltd. 25,555 77,036,073 25,555 77,036,073

Others 32,950,220 32,422,019 2,075,136 593,791

Less : Allowance for doubtful accounts (25,956,330) (26,440,188) - -

6,993,890 5,981,831 2,075,136 593,791

1,190,985,895 742,272,600 1,186,067,141 736,884,560

Advances to subsidiaries

WorldPhone Shop Co., Ltd. - - 22,867,790 96,811,198

TAC Service Co., Ltd. - - 63,730,307 54,642,889

Others - - 2,890,028 928,523

- - 89,488,125 152,382,610

Advances to related companies

United Communication Industry Plc. 117,703,090 91,859,088 116,764,345 91,827,048

Less: Allowance for doubtful account (49,000,000) - (49,000,000) -

68,703,090 91,859,088 67,764,345 91,827,048

Others 14,488,825 14,851,303 13,907,283 14,851,303

Less : Allowance for doubtful accounts (8,047,552) - (8,047,552) -

6,441,273 14,851,303 5,859,731 14,851,303

75,144,363 106,710,391 73,624,076 106,678,351

Long - term loans to subsidiaries

TAC Investment Ltd. - - 1,354,171,401 1,279,902,462

TAC Service Co., Ltd. - - 22,400,000 22,400,000

- - 1,376,571,401 1,302,302,462

Amounts due from a subsidiary

TAC Property Co., Ltd. - - 2,026,636,020 2,217,001,381



2001 2000 2001 2000

Amounts due from related companies

Fonepoint (Thailand) Limited 268,410,974 268,410,974 268,410,974 268,410,974

Less : Allowance for doubtful accounts (268,410,974) (268,410,974) (268,410,974) (268,410,974)

- - - -

Network Consultant Company Limited 170,036,800 170,036,800 170,036,800 170,036,800


- - - -

Ucom International Company Limited 64,100,882 64,100,882 64,100,882 64,100,882


- - - -

AM/PM (Thailand) Limited 156,355,805 154,334,976 - -

Less : Allowance for doubtful accounts (156,355,805) (154,334,976) - -

- - - -

Others 129,249,057 114,319,733 69,808,646 48,412,279


31,396,033 20,668,243 30,853,722 9,457,355

31,396,033 20,668,243 30,853,722 9,457,355

Accounts payable - trade: subsidiary

TAC Property Co., Ltd. - - - 44,350,161

Advances from related companies

Telenor Asia Pte. Ltd. 120,321,189 - 120,321,189 -

Others 34,843,835 30,501,709 34,843,835 30,424,053

155,165,024 30,501,709 155,165,024 30,424,053

(1) The loan to TAC Investment Limited, amounting to USD 75 million (2000 : USD 75 million), is a loan for the purchases of the Company’s shares with

interest charged at SIBOR. However, the Company has stopped recognizing interest income since November 2000. The amount has been shown net of

cost of treasury stock bought by the subsidiary of Baht 1,973 million.

(2) Long - term loan from a subsidiary represents a loan from TAC Finance Company B.V. in the form of Bills of Exchange, the net value of which was Yen

37,649 million (2000 : Yen 50,018 million). The loan will be repaid between 1998 and 2006. The Company and its subsidiary have entered into various

currency exchange and interest rate swap agreements with foreign financial institutions to reduce exchange rate risk on this loan.

(3) Amount due from TAC Property Co., Ltd. is receivables arising from sales of equipment for supporting cellular telephone services that have no fixed term

for repayment and are none interest bearing.

As of 31 December 2001 the Company had long outstanding balances of trade accounts receivable and other amounts due from and advances to 4 related

companies totaling Baht 188 million, against which an allowance for doubtful accounts of Baht 66 million has been established.


7. ACCOUNTS RECEIVABLE FROM FORWARD EXCHANGE CONTRACTS

As at 31 December 2000, accounts receivable from forward exchange contracts represented the net result of forward exchange contracts made with banks

to hedge foreign exchange risk of liabilities to be incurred from the purchase of tools and equipment for providing cellular telephone services and handset

equipment. The contracts were for the purchase of approximately USD 109.2 million at strike prices between Baht 37.81 and Baht 43.59 per USD 1 and EURO

2 million at strike prices between Baht 36.60 and Baht 37.36 per EURO 1. The contracts came due during January to June 2001.

8. INVENTORIES

(Unit : Baht)


2001 2000 2001 2000

Inventories 2,168,503,626 1,166,028,255 2,095,020,132 1,078,172,594

Less : Allowance for inventory

obsolescence (270,329,920) (166,302,520) (242,883,967) (135,327,291)

Net 1,898,173,706 999,725,735 1,852,136,165 942,845,303

9. OTHER CURRENT ASSETS

(Unit : Baht)


2001 2000 2001 2000

Interim tax 193,504,350 193,504,350 193,504,350 193,504,350

Withholding tax deducted at source 73,237,509 73,067,499 67,441,990 67,441,990

Value added tax refundable

from CAT 19,374,499 155,217,376 19,374,499 155,217,376

Value added tax refundable 565,534 8,527,901 - -

Prepaid expenses 79,201,669 63,810,061 73,718,768 58,689,633

Accounts receivable - others 429,765,499 247,188,449 425,244,152 217,834,696

Accounts receivable - Revenue

Department 1,155,867,659 435,956,687 1,128,412,344 400,204,970

Advance payment 45,919,405 50,321,973 43,769,711 45,768,477

Accounts receivable - TOT - 574,580,476 - 574,580,476

Receivable for cash discounts

given from a supplier 1,568,667,661 - 1,568,667,661 -

Others 77,670,881 91,909,999 71,769,631 92,873,822

3,643,774,666 1,894,084,771 3,591,903,106 1,806,115,790

The Company claimed the refund of withholding tax deducted at source and interim tax amounting to Baht 261 million from the Revenue Department. The

recoverability of the amounts depend upon the results of tax audit.The management, however, believes that the majority of claimed amounts will be recovered

in the future.


Accounts receivable - TOT consists of :


2001 2000

Receivable from fee reduction for the concession periods ended :-

15 September 1997 103,944 103,944

15 September 1998 195,073 195,073

15 September 1999 211,258 224,547

15 September 2000 37,038 827,390

15 September 2001 827,390 242,550

15 September 2002 242,550 -

1,617,253 1,593,504

Less : Allowance for doubtful accounts (547,313) (302,175)

1,069,940 1,291,329

Payable from access charges and others (1,147,363) (716,749)

Accounts receivable / ( Accounts payable ), net (Note 17) (77,423) 574,580

Baht 547 million receivable from the fee reductions for the period 1997 - 2000 is the amount that has not yet been paid, and for which the Company is

negotiating with TOT. Full provision has been established for these receivables.

The balance of accounts payable - TOT as at 31 December 2001 has been included in “Accounts payable - trade” in the balance sheet.

10. DEPOSIT WITH FINANCIAL INSTITUTION

This represents a negotiable certificate of deposit with a commercial bank that is subject to the interest rate announced by the bank and is due to mature in

2003.


11. INVESTMENTS IN SUBSIDIARIES ACCOUNTED FOR UNDER EQUITY METHOD

(Unit : Baht)

COMPANY ONLY

Paid-up share Percentage of

capital shareholding Investments at cost Investments at equity

2001 2000 2001 2000 2001 2000 2001 2000

Million Baht % %

WorldPhone Shop Co., Ltd. 450 450 100 100 449,999,650 449,999,650 (63,815,987) 177,339,842

TAC Property Co., Ltd. 1 1 100 100 999,930 999,930 12,379,960 6,071,839

TAC Investment Ltd. - - 100 100 25 25 (725,525,474) (615,743,670)

TAC Service Co., Ltd. 20 20 100 100 19,998,600 19,998,600 (27,446,063) (9,916,055)

Eastern Beach Co., Ltd. 80 80 100 100 - - (17,094,504) (17,078,883)

TAC Finance Company B.V. 0.5 0.5 100 100 - - 160,729,573 173,154,126

Viphavadee Office Building 208.6 208.6 100 100

Co., Ltd. - - (61,753,671) (42,963,127)

Piyanee Co., Ltd. - 11 - 100 - - - (63,186)

Investments in subsidiaries - net 470,998,205 470,998,205 (722,526,166) (329,199,114)

(Unit : Baht)

COMPANY ONLY

2001 2000

Net investments consist of :

Investments in subsidiaries 173,109,533 356,565,807

Provision for loss on investments in subsidiaries (895,635,699) (685,764,921)

Net investments (722,526,166) (329,199,114)

12. ASSIGNMENT OF RIGHTS AND OBLIGATIONS UNDER THE AGREEMENT TO OPERATE CELLULAR TELEPHONE SERVICES

Assets

“Account receivable from assignment of right” represents consideration receivable from DPC and related accrued interest as referred to in Note 2.2.4 (a).

The balance of consideration receivable from DPC as at 31 December 2001 was USD 96.6 million (2000 : USD 103 million) based on the lower of Baht 38.57

per USD 1 or the average prevailing exchange rate quoted by the Bank of Thailand at the date specified in the agreement. The balance is due for payment during

2002 to 2005, earns interest at the rate of 7.75 - 9.5 percent per annum and is guaranteed by the rights and obligations under the agreement to operate

cellular telephone service of DPC.

Liability

“Advance received - other” represents the Baht 5,400 million consideration received from DPC, net of the amount recognised in revenue, under the agreement

referred to in Note 2.2.4 (a).


13. OTHER LONG-TERM INVESTMENTS(Unit : Baht)


2001 2000 2001 2000

Available-for-sale securities

Marketable equity securities

The International Engineering Plc. 127,000,000 127,000,000 127,000,000 127,000,000

Less : Provision for impairment (119,634,000) (119,634,000) (119,634,000) (119,634,000)

7,366,000 7,366,000 7,366,000 7,366,000

Debt securities 828,515 714,401 828,515 714,401

Government bonds 19,931,000 20,000,000 19,931,000 20,000,000

Other investments

World Page Co., Ltd. 12,000,000 12,000,000 12,000,000 12,000,000

Digital Phone Co., Ltd. 197,600,000 197,600,000 197,600,000 197,600,000

Abacas Distribution System (Thailand) Co., Ltd. 18,000,000 18,000,000 - -

The Hariphunchai Memorial Hospital Co., Ltd. 6,000,000 6,000,000 6,000,000 6,000,000

S.A.S. Trading Co., Ltd. 25,000,000 25,000,000 25,000,000 25,000,000

Seungri & Dankuntod Co-Op co., Ltd. 5,000,000 5,000,000 5,000,000 5,000,000

Intercity Paging Service (Private) Ltd. 6,551,881 6,551,881 6,551,881 6,551,881

Other companies 12,381,500 12,381,500 2,381,500 2,381,500

Total other investments 282,533,381 282,533,381 254,533,381 254,533,381

Less : Provision for impairment (83,333,381) (62,333,381) (55,333,381) (44,333,381)

199,200,000 220,200,000 199,200,000 210,200,000

Total other long-term investments 227,325,515 248,280,401 227,325,515 238,280,401

As of 31 December 2000, the Company had accounts payable of approximately Baht 65.88 million for a call for the balance of the issued shares held in Digital

Phone Co., Ltd. This was paid in October 2001.

Cos

t

31 D

ecem

ber

2000

1,1

93

,84

5,5

52

1,0

20

,18

8,4

99

51

9,2

82

19

,98

2,0

74

30

2,3

14

,86

63

5,4

19

,19

51

,18

0,0

07

,22

51

26

,06

9,5

09

10

2,3

86

,95

04

30

,31

6,2

30

1,5

54

,43

7,9

22

17

7,8

94

,75

21

47

,90

5,6

09

6,2

91

,28

7,6

65

Purc

hase

s2

6,7

66

,61

51

4,8

98

,12

51

06

,60

43

1,6

90

37

,64

2,4

76

-2

91

,57

3,3

67

-7

98

,17

06

8,7

08

,07

08

55

,69

3,2

80

75

,40

2,6

77

24

,81

5,0

70

1,3

96

,43

6,1

44

Dis

posa

ls-

--

-(2

2,2

59

,08

6)

-(2

99

,45

0)

-(7

00

,80

0)

(9,8

45

,77

6)

(59

,11

6,4

01

)(1

7,8

60

,09

5)

(3,5

72

,74

1)

(11

3,6

54

,34

9)

Sale

of

subs

idia

ry(3

0,0

13

,95

0)

--

--

--

--

--

--

(30

,01

3,9

50

)

31 D

ecem

ber

2001

1,1

90

,59

8,2

17

1,0

35

,08

6,6

24

62

5,8

86

20

,01

3,7

64

31

7,6

98

,25

63

5,4

19

,19

51

,47

1,2

81

,14

21

26

,06

9,5

09

10

2,4

84

,32

04

89

,17

8,5

24

2,3

51

,01

4,8

01

23

5,4

37

,33

41

69

,14

7,9

38

7,5

44

,05

5,5

10

Accu

mul

ated

dep

reci

atio

n

31 D

ecem

ber

2000

-1

41

,03

2,1

16

-1

,79

2,6

13

10

2,1

99

,94

42

,40

7,3

71

16

6,0

23

,81

91

9,9

72

,57

51

8,3

54

,06

92

64

,74

7,3

92

97

4,3

65

,47

29

4,2

64

,16

36

7,7

78

,16

11

,85

2,9

37

,69

5

Dep

reci

atio

n fo

r th

e ye

ar-

48

,29

9,0

14

-9

99

,27

84

2,4

62

,42

62

,32

5,1

69

66

,71

0,8

32

6,3

03

,47

5-

62

,27

1,0

03

33

3,2

72

,26

93

3,7

21

,36

82

9,0

79

,92

56

25

,44

4,7

59

Dep

reci

atio

n -

disp

osal

s

/

adju

stm

ents

--

--

(21

,25

4,0

41

)-

--

-(4

,73

4,5

23

)(4

2,1

23

,06

5)

(12

,27

7,8

64

)(3

,32

3,1

16

)(8

3,7

12

,60

9)

31 D

ecem

ber

2001

-1

89

,33

1,1

30

-2

,79

1,8

91

12

3,4

08

,32

94

,73

2,5

40

23

2,7

34

,65

12

6,2

76

,05

01

8,3

54

,06

93

22

,28

3,8

72

1,2

65

,51

4,6

76

11

5,7

07

,66

79

3,5

34

,97

02

,39

4,6

69,

84

5

Prov

isio

n fo

r im

pairm

ent

31 D

ecem

ber

2000

3,0

00

,00

0-

--

--

--

31

,11

5,4

86

--

--

34

,11

5,4

86

Incr

ease

--

--

--

--

41

,48

7,3

15

--

--

41

,48

7,3

15

31 D

ecem

ber

2001

3,0

00

,00

0-

--

--

--

72

,60

2,8

01

--

--

75

,60

2,8

01

Net

boo

k va

lue

31 D

ecem

ber

2000

1,1

90

,84

5,5

52

87

9,1

56

,38

35

19

,28

21

8,1

89

,46

12

00

,11

4,9

22

33

,01

1,8

24

1,0

13

,98

3,4

06

10

6,0

96

,93

45

2,9

17

,39

51

65

,56

8,8

38

58

0,0

72

,45

08

3,6

30

,58

98

0,1

27

,44

84

,40

4,2

34

,48

4

31 D

ecem

ber

2001

1,1

87

,59

8,2

17

84

5,7

55

,49

46

25

,88

61

7,2

21

,87

31

94

,28

9,9

27

30

,68

6,6

55

1,2

38

,54

6,4

91

99

,79

3,4

59

11

,52

7,4

50

16

6,8

94

,65

21

,08

5,5

00

,12

51

19

,72

9,6

67

75

,61

2,9

68

5,0

73

,78

2,8

64

Dep

reci

atio

n in

clud

ed

in t

he e

arni

ngs

stat

emen

ts f

or t

he y

ear

2000

54

8,4

00

,36

2

2001

62

5,4

44

,75

9

Equi

pmen

t fo

rAd

vert

isin

g

supp

orti

ngFu

rnit

ure,

and

Bui

ldin

g in

Land

Bui

ldin

gCe

llula

r Te

leph

one

Cel

l si

teA

sset

fixtu

res

and

Mac

hine

ry a

ndco

mm

unic

atio

n

Land

Bui

ldin

gspr

ogre

ssim

prov

emen

tim

prov

emen

tLe

aseh

old

right

Ser

vice

sim

prov

emen

taw

aitin

g tr

ansf

er o

ffic

e eq

uipm

ent

equi

pmen

tVe

hicl

eseq

uipm

ent

Tota

l

14

.PR

OPE

RTY

, PL

AN

T A

ND

EQ

UIP

MEN

T

(Uni

t :

Bah

t)

Con

solid

ated

Cos

t

31 D

ecem

ber

2000

68

9,9

37

,38

72

26

,09

8,1

98

17

4,9

82

,78

93

5,4

19

,19

53

32

,16

7,8

74

10

1,3

28

,69

93

65

,46

2,5

65

1,4

24

,30

0,5

47

17

1,2

59

,91

21

39

,63

4,1

24

3,6

60

,59

1,2

90

Purc

hase

s2

6,7

66

,61

51

4,8

98

,12

53

7,4

83

,41

6-

29

1,5

17

,36

3-

67

,89

6,0

32

85

4,9

01

,70

47

3,2

93

,70

42

4,7

65

,61

71

,39

1,5

22

,57

6

Dis

posa

ls-

-(1

9,6

07

,82

7)

-(2

99

,45

0)

-(3

,23

2,8

55

)(9

,99

3,1

71

)(1

4,4

29

,33

2)

(2,6

07

,84

0)

(50

,17

0,4

75

)

31 D

ecem

ber

2001

71

6,7

04

,00

22

40

,99

6,3

23

19

2,8

58

,37

83

5,4

19

,19

56

23

,38

5,7

87

10

1,3

28

,69

94

30

,12

5,7

42

2,2

69

,20

9,0

80

23

0,1

24

,28

41

61

,79

1,9

01

5,0

01

,94

3,3

91

Accu

mul

ated

dep

reci

atio

n

31 D

ecem

ber

2000

-6

4,0

64

,40

67

6,2

21

,42

12

,40

7,3

71

28

,09

2,3

24

18

,35

4,0

69

23

5,6

31

,42

99

14

,29

1,6

60

90

,90

7,1

01

64

,45

4,0

20

1,4

94

,42

3,8

01

Dep

reci

atio

n fo

r th

e ye

ar-

17

,33

2,2

32

29

,65

2,8

11

2,3

25

,16

91

9,8

06

,43

1-

51

,16

0,0

28

31

7,3

01

,53

83

2,7

75

,07

42

7,7

67

,58

04

98

,12

0,8

63

Dep

reci

atio

n –

disp

osal

s /

adju

stm

ents

--

(18

,70

6,1

41

)-

--

(1,0

37

,58

3)

(9,0

60

,16

9)

(10

,30

4,6

56

)(2

,44

7,5

03

)(4

1,5

56

,05

2)

31 D

ecem

ber

2001

-8

1,3

96

,63

88

7,1

68

,09

14

,73

2,5

40

47

,89

8,7

55

18

,35

4,0

69

28

5,7

53

,87

41

,22

2,5

33

,02

91

13

,37

7,5

19

89

,77

4,0

97

1,9

50

,98

8,6

12

Prov

isio

n fo

r im

pairm

ent

31 D

ecem

ber

2000

3,0

00

,00

0-

--

-3

1,1

15

,48

6-

--

-3

4,1

15

,48

6

Incr

ease

--

--

-4

1,4

87

,31

5-

--

-4

1,4

87

,31

5

31 D

ecem

ber

2001

3,0

00

,00

0-

--

-7

2,6

02

,80

1-

--

-7

5,6

02

,80

1

Net

boo

k v a

lue

31 D

ecem

ber

2000

68

6,9

37

,38

71

62

,03

3,7

92

98

,76

1,3

68

33

,01

1,8

24

30

4,0

75

,55

05

1,8

59

,14

41

29

,83

1,1

36

51

0,0

08

,88

78

0,3

52

,81

17

5,1

80

,10

42

,13

2,0

52

,00

3

31 D

ecem

ber

2001

71

3,7

04

,00

21

59

,59

9,6

85

10

5,6

90

,28

73

0,6

86

,65

55

75

,48

7,0

32

10

,37

1,8

29

14

4,3

71

,86

81

,04

6,6

76

,05

11

16

,74

6,7

65

72

,01

7,8

04

2,9

75

,35

1,9

78

Dep

reci

atio

n in

clud

ed i

n th

e ea

rnin

gs s

tate

men

ts f

or t

he y

ear

2000

39

0,3

31

,63

8

2001

49

8,1

20

,86

3

Eq

uipm

ent

for

A d

vert

isin

g

sup

por t

ing

Ass

etFu

rnit

ure,

and

Bui

ldin

g in

Cellu

lar

Tele

phon

eaw

aiti

ngfix

ture

s an

dM

achi

nery

and

com

mun

icat

ion

Land

Bui

ldin

gspr

ogre

ssLe

aseh

old

right

Ser

vice

sTr

ansf

er o

ffic

e eq

uipm

ent

equi

pmen

tVe

hicl

eseq

uipm

ent

Tota

l

(Uni

t :

Bah

t)

Com

pany

onl

y


15. DEFERRED RIGHT TO USE OF EQUIPMENT

Deferred right to use of equipment represents the cost of tools and equipment for providing cellular telephone services under the agreements with CAT as

outlined in Note 2.2.1. Ownership of the tools and equipment was transferred to CAT at the date of commencing the services or when the equipment was put

into use.

The cost of such tools and equipment is deferred and amortised over the concession period.

Deferred right to use of equipment consists of the following :-

(Unit : Baht)


2001 2000 2001 2000

Deferred right 68,008,964,171 47,143,161,636 67,183,524,171 46,317,721,635

Less : Accumulated amortisation (12,656,793,056) (9,970,411,468) (12,466,779,433) (9,818,400,569)

Net deferred right 55,352,171,115 37,172,750,168 54,716,744,738 36,499,321,066

Amortisation included in the earnings

statements 2,713,213,380 2,052,769,387 2,675,210,656 2,014,766,663

16. OTHER NON-CURRENT ASSETS

(Unit : Baht)


2001 2000 2001 2000

Deferred expenses - net 933,277,964 1,028,592,236 933,277,964 1,023,651,125

Cost of right to operate shops - net - 100,333,146 - -

Deferred underwriting fees for bonds

and convertible bonds - net 143,771,954 179,478,835 143,771,954 179,478,835

Deferred arrangement fees for loans - net 265,007,381 239,212,054 265,007,381 239,212,054

Deposits 410,363,403 225,732,652 403,862,830 216,824,362

Others 34,503,512 40,057,380 16,195,733 20,241,473

1,786,924,214 1,813,406,303 1,762,115,862 1,679,407,849

Amortisation included in the earnings

statements 542,575,691 1,136,565,342 440,047,971 1,111,661,678

During 2000 deferred fees for the extension of a loan agreement and related arrangement fees, of approximately Baht 374 million were fully amortised on the

final repayment of the loans in September 2000 ( Note 26).


17. ACCOUNTS PAYABLE - TRADE

(Unit : Baht)


2001 2000 2001 2000

Accounts payable for the purchase

of cell site equipment 5,866,142,581 344,647,794 5,866,142,581 344,647,794

Accounts payable for the purchase

of handsets and related equipment 964,104,962 443,690,190 964,104,962 443,690,190

Accounts payable - CAT 873,080,196 705,653,716 873,080,196 705,653,716

Accounts payable - TOT (Note 9) 77,422,868 - 77,422,868 -

Others 136,295,312 139,119,220 88,454,387 55,683,236

7,917,045,919 1,633,110,920 7,869,204,994 1,549,674,936

18. SHORT TERM LOANS FROM FINANCIAL INSTITUTIONS

(Unit : Baht)


2001 2000 2001 2000

Bills of exchange 1,650,392,482 - 1,650,392,482 -

Trust receipts 246,869,715 - 246,869,715 -

1,897,262,197 - 1,897,262,197 -

Bills of exchange represent transferable bills of exchange issued by the Company to financial institutions with 3 months maturity due in 2002.

19. LONG-TERM LOANS

19.1 On 19 July 2000, the Company entered into an agreement with a group of financial institutions for credit facilities of Baht 20,000 million. These consist

of :-

Interest rate

Facility per annum Principal repayment Interest payment

(Million Baht)

Bridge loan 4,000 MLR - 2% (a) 15 December 2000 every month-end

First term loan 13,000 MLR - 0.5% (a) between 31 March 2002 to every three months

30 June 2005

Revolving loan 3,000 MLR - Margin (a) 30 June 2005 every three months

(a) The higher of the above and the average fixed deposit interest rate plus 2.5 percent per annum.

The above credit agreement contains covenants relating to various matters such as the maintenance of financial ratios, restrictions on incurring

indebtedness, a prohibition on making loans or granting guarantees except under certain conditions, and restrictions on the payment of dividends.


Various fees and expenses in connection with this agreement amounting to approximately Baht 261 million have been recorded as deferred expenses and

are amortised over the contract period.

The bridge loan expired on 19 October 2000, and at 31 December 2000 the Company had not drawn any amounts from the other facilities. On 24 October

2001 the Company cancelled the facilities and all commitments under the Facilities Agreement dated 19 July 2000.

19.2 On 24 October 2001 the Company entered into a new credit Facility Agreement of Baht 16,000 million with a group of financial institutions. This facility

effectively refinances and extends the Facility Agreement from July 2000. Additional fees of Baht 70 million have been recorded as deferred expenses

and amortised over the contract period.

On 24 December 2001 Baht 5,300 million of this facility was cancelled by the Company as required by the Facility Agreement upon certain anticipated

alternative facilities becoming available (Note 19.3).

As of 31 December 2001, Baht 6,500 million of this facility had been drawn.

The principal terms of this facility are :

Facility : Baht 16,000 million

Interest rate : The higher of MLR minus 0.5% and the average fixed deposit interest rate plus 2.5% per annum

Interest period : every three months

Principal repayment schedule : 14 quarterly installments in various amounts during 2003 to 2006

This credit agreement contains covenants relating to various matters such as the maintenance of financial ratios, restrictions on incurring indebtedness

and creating or permiting the subsistence of security interest on property and assets, a prohibition on making loans or granting guarantees except under

certain conditions, and restrictions on the payment of dividends.

19.3 On 24 December 2001 the Company entered into a Facility Agreement with Finnish Export Credit Plc. The principal terms of this facility are :

Facility : USD 120 million

Interest rate : LIBOR plus 0.72 percent per annum

Interest period : every six months

Principal repayment schedule : 14 semi-annual installments in the amounts and in the periods stipulated in the agreement

during 2002 to 2009

The above credit agreement contains covenants relating to various matters such as the maintenance of financial ratios, restrictions on incurring

indebtedness and creating or permiting the subsistence of security interest on property and assets, a prohibition on making loans or granting guarantees

except under certain conditions, and restrictions on the payment of dividends.

On 25 January 2002 the Company drew USD 15 million from this facility.


20. ADVANCES RECEIVED FOR REGISTRATION OF NUMBER

Advances received for the registration of numbers were amounts collected from vendors for each telephone number to be sold to customers. The Company

recognised the amount partly as revenue and partly as customers’ deposits when service of the telephone number was brought into service.

21. CUSTOMERS’ DEPOSITS

Customers’ deposits are amounts collected from subscribers which the Company has to refund to subscribers when subscription contracts are terminated as

at the Company’s discretion. At the end of the concessioned period, the Company would have to transfer any outstanding balance to CAT.

22. NOTES AND BONDS

(Unit : Baht)


2001 2000 2001 2000

US Dollar - notes and bonds 13,306,100,000 16,984,862,212 - -

Thai Baht debentures 21,000,000,000 6,000,000,000 21,000,000,000 6,000,000,000

34,306,100,000 22,984,862,212 21,000,000,000 6,000,000,000

Less : current portion of

: US Dollar - Notes (USD 100 million) - (3,951,180,212) - -

: Thai Baht debentures (857,160,000) - (857,160,000) -

(857,160,000) (3,951,180,212) (857,160,000) -

Notes and bonds - net of current portion 33,448,940,000 19,033,682,000 20,142,840,000 6,000,000,000

22.1 US Dollar - notes and bonds

In November 1996, the Company issued notes and bonds totalling USD 400 million as follows :-

- Notes of USD 100 million at the offering price of 99.971 percent of the principal amount, bearing interest at 7.625 percent per annum which

matured in November 2001.

- Bonds of USD 300 million at the offering price of 99.773 percent of the principal amount, bearing interest at 8.375 percent per annum which have

due for repayment in 2006.

On 1 May 1997, with the approval of the requisite number of holders of the Notes and Bonds, the Company and TAC Finance Company B.V., a subsidiary,

entered into a Supplemental Indenture Agreement whereby TAC Finance Company B.V. has replaced the Company as the primary obligor of the principal,

premium and interest on the Notes of USD 100 million and Bonds of USD 300 million. The Company’s status as the issuer of the Notes and Bonds has

been terminated and the Company has unconditionally and irrevocably guaranteed the payment obligations of TAC Finance Company B.V.

The Company and its subsidiary entered into various currency exchange and interest rate swap agreements with foreign financial institutions to reduce

exchange rate risk on these obligation.

At 31 December 2001, all of the USD 300 million bonds are covered by forward and swap contracts, at strike prices between Baht 43.10 to Baht 45.25

per USD 1. The contracts will come due in November 2006.

a n n u a l r e p o r t 2 0 0 1Total Access Communication Plc.7 4

22.2 Thai Baht debentures

22.2.1 On 12 October 2000, the Company issued Baht 6,000 million (6,000,000 units of Baht 1,000 each) registered, unsubordinated, unsecured

amortising debentures with a trustee, bearing interest at 6.5 percent per annum and with a final maturity in 5 years. They are to be redeemed in

14 equal installments from 12 July 2002 until their maturity date of 12 October 2005.

22.2.2 On 4 April 2001, the Company issued Baht 15,000 million (15,000,000 units of Baht 1,000 each) registered, unsubordinated, unsecured

amortising debentures with a trustee, bearing interest at 5.6 percent per annum and with a final maturity in 5 years.They are to be redeemed in

14 equal quarterly installments from 4 January 2003 until their maturity date of 4 April 2006.

The above debentures contain covenants relating to various matters such as the maintenance of financial ratios, a prohibition on granting guarantees

except under certain conditions, and restrictions on the payment of dividends.

23. CONVERTIBLE BONDS

a) In May and July 1996, the Company issued convertible bonds totalling USD 220 million (220,000 units of USD 1,000 each) bearing interest at 2 percent

per annum and maturing on 31 May 2006 at the fixed exchange rate of Baht 25.29 per USD 1. The bonds are convertible from 10 July 1996 to 30 April

2006 at USD 10.50 per one ordinary share.

b) In August 1996, the Company issued convertible bonds totalling USD 30 million (30,000 units of USD 1,000 each) bearing interest at 2 percent per

annum and maturing on 14 August 2006 at the fixed exchange rate of Baht 25.29 per USD 1. The bonds are convertible from 23 September 1996 to 14

July 2006 at USD 10.50 per one ordinary share.

The convertible bonds carry a call option allowing the Company to redeem them under certain conditions. They also include a put option allowing the

bondholders to have their bonds redeemed at a premium of 34.05 percent to the issue price on 31 May 2001 and 14 August 2001, respectively.

In September and November 2000, the Company repurchased USD 34.05 million and USD 7.68 million convertible bonds, respectively, with no material

gain or loss.

At 31 December 2000 the premium payable on exercising of the put options was disclosed as contingent liability, as any repayment was dependent upon

the options being exercised. However, provision was made for the premium payable on redemption, calculated evenly over the life of the option, amount-

ing to Baht 2,647 million (or USD 64.6 million). The convertible bonds and provision for the premium payable on redemption were presented in “Current

liabilities” on the balance sheet.

In April 2001, the Company redeemed USD 4.3 million of the convertible bonds, prior to maturity, with no material gain or loss.

On 31 May 2001, the Company redeemed USD 215 million, or Baht 8,543 million, of the convertible bonds at a premium, as a result of the bondholders’

exercising their put option. Related expenses of Baht 277 million were also incurred. No application was made to exercise the put option for USD 13.5

million of the bonds. These will now mature in 2006 with a fixed exchange rate of Baht 25.29 per USD 1, and continue to carry the call option allowing

the Company to redeem them under certain conditions. The bondholders retain the right to convert the bonds to ordinary shares until 30 April 2006. The

Company recognized a foreign exchange gain of Baht 245 million in the second quarter of 2001 from adjusting of the value of the bonds to the exchange

rate at the maturity date.

USD 11.99 million of these convertible bonds were subsequently redeemed on 31 August 2001, prior to maturity, with a gain on redemption of approxi-

mately Baht 54 million.


On 14 August 2001, the Company redeemed USD 40.2 million, or Baht 1,661 million, of the convertible bonds at a premium, as a result of the

bondholders’ exercising their put option, with additional related expenses of Baht 53 million.

As at 31 December 2001, the outstanding convertible bonds comprise of USD 1.5 million for which the bondholders did not exercise their put option on

31 May 2001. The balance of these bonds has been presented as “long term liabilities” in the balance sheet.

24. SHARE CAPITAL/PREMIUM ON ORDINARY SHARES

On 20 June 2000 the Company increased its paid up share capital through the issue of an additional 21.5 million new ordinary shares at a par value of Baht 10

each, sold to Telenor Asia Pte.Ltd., (“Telenor”) at a price per share of USD 3.75 with a total of USD 80.6 million (or Baht 3,151 million) received in payment.

On 31 August 2000 the Company increased its paid up share capital through the issue of an additional 48.5 million new ordinary shares at a par value of Baht

10 each, sold to Telenor at a price per share of USD 3.75 with a total of USD 181.9 million (or Baht 7,425 million) received in payment.

The Company incurred advisory fees in respect of these share sales agreements amounting to Baht 235 million which were recorded as a deduction against the

share premium amount.

25. SHARES OF THE COMPANY HELD BY A SUBSIDIARY

At 31 December 2001 and 2000, 170,100 outstanding shares of the Company were held by a subsidiary. They are presented as a deduction in shareholders’

equity and are stated at cost.

26. FINANCIAL COSTS

(Unit : Baht)


2001 2000 2001 2000

Interest expenses 2,801,471,878 2,201,461,395 2,819,757,107 2,235,658,845

Provision for the premium payable

on redemption of convertible bonds 320,959,602 694,532,960 320,959,602 694,532,960

Fees and related expenses for

extension to loan agreements (Note 16) - 373,720,882 - 373,720,882

3,122,431,480 3,269,715,237 3,140,716,709 3,303,912,687

27. CORPORATE INCOME TAX

Corporate income tax for the year has been calculated on the net earnings of the Company and subsidiaries after adding back certain provisions and expenses

which are disallowable for tax purpose and deducting tax losses brought forward from previous years and the share of profit or losses on investments in

subsidiaries which are not taxable.


28. RETURN OF NUMBERING FEE

As from the first quarter of 2001, the Company changed its policy and has ceased collecting numbering fee from its vendor when the mobile telephone numbers

are allocated. In addition, the Company has returned the amounts of such fees, collected in the past for mobile telephone numbers for which service to

customers has not yet commenced. The related credit notes issued to UCOM and other venders amounting to Baht 323 million and Baht 289 million,

respectively, were recorded as a deduction against “Other operating income” in the earnings statement for the year ended 31 December 2001.

29. FINANCIAL INSTRUMENTS

29.1 Financial risk management policiesThe Company and subsidiaries are exposed to risks from changes in market interest rates and in currency exchange rates, and from nonperformance of

contractual obligations by counterparties. The Company and subsidiaries use derivative instruments, as and when they are considered appropriate, to

manage such risks. Such instruments are not held or issued for speculative or trading purposes.

29.2 Interest rate riskInterest rate risk is the risk that future movement in market interest rates will effect the results of the Company and subsidiaries’ operations and their

cash flows. The Company’s and subsidiaries’ exposure to interest rate risk relates primarily to their deposits with financial institutions, short-term loans

and long-term loans from financial institutions, notes, bonds and convertible bonds. The Company and subsidiaries do not use derivative financial

instruments to hedge such risk.

At 31 December 2001 the Company and subsidiaries are exposed to risks from interest rate for financial assets and liabilities as follows :-


CONSOLIDATED

Note Floating interest Fixed interest Total

Items rate rate

Financial assets

Cash at banks 1,863 - 1,863

Current investments - fixed deposits - 1,267 1,267

Deposit with financial institution 16 - 16

Financial liabilities

Short term loans from financial institutions 18 - 1,897 1,897

Long term loans from financial institutions 19 6,500 - 6,500

Bonds 22 - 34,306 34,306

Convertible bonds 23 - 38 38


Financial assets and liabilities carrying fixed interest rates and classified by maturity at 31 December 2001 are summarised below :-


CONSOLIDATED

Within 12 Over 12

Items At call months Months Total Interest rate

Financial assets

Current investments - 1,267 - 1,267 0.5%

Financial liabilities

Short term loans from financial institutions - 1,897 - 1,897 3.4%-3.8%

Bonds

: US Dollar - Bonds - - 13,306 13,306 8.375%

: Thai Baht debentures - 857 20,143 21,000 5.6% and 6.5%

- 857 33,449 34,306

Convertible bonds - - 38 38 2%

29.3 Foreign currency risk

The Company and subsidiaries’ exposure to foreign currency risk relate primarily to trust receipts, accounts payable-trade and bonds which are denomi-

nated in foreign currencies. The Company and subsidiaries primarily utilise forward exchange contracts to hedge the exchange rate risk arising from

these instruments (Note 17 and 22).

At 31 December 2001 the Company and subsidiaries had the following foreign currency assets and liabilities (after the execution of forward currency

transactions for certain parts of their liabilities) which were not hedged against foreign exchange rate risk :

Foreign

Amount currency Due for repayment

Assets (Million) (Year)

Cash at banks 26.8 USD -

Liabilities

Interest payable 3.9 USD 2001

Trust receipts 5.6 USD 2001

Accounts payable - trade * 25.6 USD 2001

5.8 EUR 2001

Net liabilities 8.3 USD

5.8 EUR

(*) net of the amount of USD 100 million for which the account payable has issued bills of exchange guaranteed by the Company of Baht 4,452 million

to financial institutions and the amount of USD 12.2 million and EUR 1.0 million covered by forward contracts.


The exchange rate for translation of foreign currency liabilities into Baht as of 31 December 2001 was Baht 44.3597 per USD 1 and Baht 39.3736 per

EUR 1.

29.4 Credit risk

The Company and subsidiaries are exposed to credit risk primarily with respect to trade accounts receivable. However, due to the large number of entities

comprising the Company and subsidiaries’ customer base, the Company and subsidiaries do not anticipate material losses from debt collection and

believe that the maximum exposure to credit risk is limited to the carrying amount of receivables less allowance for doubtful debts as stated in the

balance sheets.

With respect to off-balance sheet derivative financial instruments, it is the Company’s policy to enter into financial instruments with credit worthy

counterparties. Therefore, the Company does not expect any material losses to arise from the counterparties’ failure to perform their obligations under

the financial instruments.

29.5 Fair value

Given that all financial assets are short-term, part of financial liabilities are short-term and that long-term financial liabilities, long-term loans and bonds

carry interest at rates close to current market rates, management believes that their fair value does not materially differ from their carrying value.

30. STATUTORY RESERVE

Pursuant to Section 116 of the Public Limited Companies Act B.E. 2535, the Company is required to set aside a statutory reserve of at least 5 percent of its

net earnings after deducting accumulated deficits brought forward (if any) until the reserve reaches 10 percent of the registered share capital. During the year,

the Company did not set aside a statutory reserve from its net earnings for the year as its brought forward deficits (as a result of reclassification of accounts

described in Note 4) exceed the net earnings for the year.

31. STATEMENTS OF CASH FLOWS

For the purposes of the statements of cash flows, cash and cash equivalents include cash in hand and at banks and deposits with financial institutions with an

original maturity of 3 months or less and without commitments.

Cash and cash equivalents as reflected in the statements of cash flows consist of the following :-

(Unit : Baht)


2001 2000 2001 2000

Cash in hand and at banks 1,863,184,044 4,281,561,761 1,702,968,063 4,063,293,768

Fixed deposits with banks 1,266,884,082 702,087,861 1,266,761,794 701,967,860

3,130,068,126 4,983,649,622 2,969,729,857 4,765,261,628

Less : Amount with maturity of

more than 3 months and pledged (36,954,889) (37,351,352) - -

Cash and cash equivalents 3,093,113,237 4,946,298,270 2,969,729,857 4,765,261,628


32. COMMITMENTS

32.1 Lease commitments

At 31 December 2001 the Company and subsidiaries have the following operating lease commitments for the lease of office buildings :-



2002 60.3 43.7

2003 34.3 25.0

2004 onwards 18.2 16.5

The Company and subsidiaries also have operating lease obligations for base stations totalling Baht 16 million per month.

32.2 Capital commitments

At 31 December 2001 the Company has capital commitments of Baht 5,812 million (2000 : Baht 5,698 million) in respect of purchase of tools and

equipment for providing the cellular telephone services and purchase of handsets.

32.3 Long-term service agreement

On 1 July 1998, one of the subsidiaries entered into an Assignment Agreement with AM/PM (Thailand) Ltd. to operate the “am/pm” shops in Thailand.

With the consent of am/pm International Inc., AM/PM (Thailand) Ltd. assigned and transferred the rights and obligations under “am/pm mini market -

Licensing Agreement” dated 29 November 1990 to the subsidiary to operate the am/pm shops. The “am/pm mini market - Licensing Agreement” covers

the period of 15 years from the year 1990. Under the agreement, the subsidiary is obliged to comply with the conditions and pay to the licenser a

franchise fee calculated at a percentage of sales as stipulated in the agreement.

On 30 September 1999, the Extraordinary Shareholders Meeting No.3/2542 of the subsidiary approved the transfer of its license to operate the am/pm

shops back to AM/PM (Thailand) Ltd. for certain reasons. However, to date, the subsidiary has not executed this transfer.

32.4 Cash at banks

At 31 December 2001, a subsidiary had deposits with a bank amounting to Baht 37 million (2000 : Baht 37 million) which are pledged to secure facilities

granted by the bank.

32.5 Bank guarantees

At 31 December 2001, there were outstanding bank guarantees of Baht 1,798 million (2000 : Baht 2,979 million) issued by banks on behalf of the

Company in respect of certain performance bonds required in the normal course of business of the Company. Bank guarantees are primarily issued to CAT

to cover customers’ deposits.

As at 31 December 2001, there were outstanding bank guarantees of Baht 35.7 million (2000 : Baht 35.8 million) issued by banks on behalf of a

subsidiary in respect of certain performance bonds required in the normal course of business of the subsidiary. These guarantees are secured by deposits

with bank of the subsidiary.


32.6 Agreements to install cell site equipment

On 27 November 2000 and 18 May 2001, the Company entered into agreements to install cell site equipment with Rural Telephone Services Co., Ltd.,

a related company. This related company will supply and install equipment for cell site base stations and will complete the services during the period

specified in the agreements. The Company is committed to pay remuneration of Baht 801 million. The payment will be made when the installation work

is completed based on the conditions specified in the agreements.

At 31 December 2001, the Company has a remaining commitment under this agreement of approximately Baht 76 million.

32.7 Agreement to install and maintain transmission networks

On 18 December 2000, the Company entered into an agreement to install and maintain transmission networks with United Information Highwary Co.,

Ltd., a related company. This related company will provide transmission engineering network design and configuration, installation and maintenance

services for transmission networks for a period of 5 years. The Company is committed to pay the service fees at the rate specified in the agreement.

On 1 July 2001, the Company entered into an agreement to install and maintain transmission networks with United Communication Industry Plc., a

related company. This related company will provide transmission engineering network design and configuration, installation and maintenance services for

transmission networks for a period of 5 years. The Company is committed to pay the service fees at the rate specified in the agreement.

33. FINANCIAL INFORMATION BY SEGMENT

The principal operations of the Company and subsidiaries involve a single industry segment in operating wireless telecommunications services and distributing

handsets and are carried out exclusively in Thailand. As a result, all revenues, operating profits and assets reflected in these financial statements pertain to

this industry segment and geographic area.

34. EMPLOYEES AND RELATED COSTS


2001 2000 2001 2000

Number of employees at end of year 3,226 3,107 2,617 2,615

Employee costs for the year (Thousand Baht) 1,330,133 921,594 1,250,542 820,482

35. PRESENTATION

The presentation of these financial statements has been made in compliance with the Notification of the Commercial Registration Department dated 14

September 2001, issued under the Accounting Act B.E. 2543.

Certain amounts in the financial statements for the year ended 31 December 2000 have been reclassified to conform to the current year classifications, with

no effect on previously reported net earnings or shareholders’ equity.

36. APPROVAL OF FINANCIAL STATEMENTS

These financial statements have been approved by the Company’s directors.

untitled art 1 - listed companydtac.listedcompany.com/misc/ar/ar2001_eng.pdf · particular,...

Documents