12. Financial Position and Operational performance

12.1 Financial statements

Auditor

+-------------------+-------------------+---------+-------------------+
| Year              | Name of auditor   | CPA no. | Auditing firm     |
+-------------------+-------------------+---------+-------------------+
| 2004/2005         | Mr. Vichien       | 3183    | KPMG Phoomchai    |
|                   | Thamtrakul        |         | Audit Ltd.        |
| (Apr 1, 2004 –    |                   |         |                   |
| Mat 31, 2005)     |                   |         |                   |
+-------------------+-------------------+---------+-------------------+
| 2003/2004         | Mr. Vichien       | 3183    | KPMG Phoomchai    |
|                   | Thamtrakul        |         | Audit Ltd.        |
| (Apr 1, 2003 –    |                   |         |                   |
| Mar 31, 2004)     |                   |         |                   |
+-------------------+-------------------+---------+-------------------+
| 2002/2003         | Mr. Vichien       | 3183    | KPMG Phoomchai    |
|                   | Thamtrakul        |         | Audit Ltd.        |
| (Apr 1, 2002 –    |                   |         |                   |
| Mar 31, 2003)     |                   |         |                   |
+-------------------+-------------------+---------+-------------------+

Auditor’s report

In the Auditor’s report on the financial statements for the year
2002/2003 ended March 31, 2003, the year 2003/2004 ended March 31, 2004
and the year 2004/2005 ended March 31, 2005, the Auditor gave an
unqualified opinion that the financial statements were fairly presented
and prepared in accordance with generally accepted accounting
principles.

The Company was incorporated in 2002 and started commercial production
in April 2003, thus no financial data for 2002/2003 are available for
comparison.

For the year 2004/2005, the consolidated financial statements of the
Company and its subsidiary are used for comparison as the Company set up
its subsidiary, namely Polyplex (Singapore) Pte. Ltd. (PSPL) in July
2004 and Polyplex Europa Polyester Film Sanayi Ve Ticaret Anonim Sirketi
(PE) in September 2004. Thus, for convenience in reference, the term
‘the Company’ to be referred to hereafter in the financial statements
will cover both the Company and its subsidiary.

+---------------------+-----+----+-----+----+-----+----+-----+----+
| Polyplex (Thailand) |     |    |     |    |     |    |     |    |
| Plc.                |     |    |     |    |     |    |     |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
| Balance Sheet       |     |    |     |    |     |    |     |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
| Unit: Bt. 000’s     |     |    |     |    |     |    |     |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|                     | Un  |    |     |    |     |    | Con |    |
|                     | con |    |     |    |     |    | sol |    |
|                     | sol |    |     |    |     |    | ida |    |
|                     | ida |    |     |    |     |    | ted |    |
|                     | ted |    |     |    |     |    |     |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|                     | 2   |    | 200 |    | 200 |    | 200 |    |
|                     | 002 |    | 3/2 |    | 4/2 |    | 4/2 |    |
|                     | /20 |    | 004 |    | 005 |    | 005 |    |
|                     | 03* |    |     |    |     |    |     |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|                     | Ap  |    | Ap  |    | Ap  |    | Ap  |    |
|                     | ril |    | ril |    | ril |    | ril |    |
|                     | -Ma |    | -Ma |    | -Ma |    | -Ma |    |
|                     | rch |    | rch |    | rch |    | rch |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|                     | Amo | %  | Amo | %  | Amo | %  | Amo | %  |
|                     | unt |    | unt |    | unt |    | unt |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
| Assets              |     |    |     |    |     |    |     |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
| Current Assets      |     |    |     |    |     |    |     |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|    Cash and cash    | 19, | 1. | 26, | 1. | 2   | 6. | 3   | 1  |
|   equivalents       | 799 | 99 | 393 | 22 | 30, | 16 | 91, | 0. |
|                     |     |    |     |    | 973 |    | 385 | 39 |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|    Investment in    | 0   | 0. | 0   | 0. | 1   | 2. | 1   | 2. |
|   marketable        |     | 00 |     | 00 | 00, | 69 | 00, | 68 |
|   securities-fair   |     |    |     |    | 763 |    | 763 |    |
|   value             |     |    |     |    |     |    |     |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|    Accounts         | 0   | 0. | 3   | 1  | 6   | 1  | 6   | 1  |
|   receivable        |     | 00 | 39, | 5. | 29, | 6. | 29, | 6. |
|                     |     |    | 336 | 64 | 408 | 80 | 408 | 71 |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|    Receivable from  | 0   | 0. | 0   | 0. | 0   | 0. | 0   | 0. |
|   related company   |     | 00 |     | 00 |     | 00 |     | 00 |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|    Inventories      | 34, | 3. | 1   | 6. | 3   | 8. | 3   | 8. |
|                     | 513 | 47 | 45, | 69 | 05, | 16 | 05, | 12 |
|                     |     |    | 158 |    | 689 |    | 689 |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|    Other current    | 13, | 1. | 43, | 1. | 73, | 1. | 77, | 2. |
|   assets            | 207 | 33 | 031 | 98 | 608 | 97 | 076 | 05 |
+---------------------+-----+----+-----+----+-----+----+-----+----+
| Total Current       | 67, | 6. | 5   | 2  | 1,3 | 3  | 1,5 | 3  |
| Assets              | 519 | 79 | 53, | 5. | 40, | 5. | 04, | 9. |
|                     |     |    | 918 | 53 | 441 | 78 | 320 | 95 |
+---------------------+-----+----+-----+----+-----+----+-----+----+
| Non-Current Assets  |     |    |     |    |     |    |     |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|    Investment in    | 0   | 0. | 0   | 0. | 4   | 1  | 0   | 0. |
|   subsidiary        |     | 00 |     | 00 | 24, | 1. |     | 00 |
|                     |     |    |     |    | 405 | 32 |     |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|    Land, premises   | 9   | 9  | 1,6 | 7  | 1,9 | 5  | 2,2 | 5  |
|   and equipment-net | 24, | 2. | 08, | 4. | 77, | 2. | 57, | 9. |
|                     | 009 | 86 | 884 | 16 | 468 | 78 | 146 | 94 |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|    Deferred         | 3,  | 0. | 6,  | 0. | 0   | 0. | 0   | 0. |
|   expenses-net      | 480 | 35 | 568 | 30 |     | 00 |     | 00 |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|   Other non current | 0   | 0. | 0   | 0. | 4,  | 0. | 4,  | 0. |
|   assets            |     | 00 |     | 00 | 469 | 12 | 469 | 11 |
+---------------------+-----+----+-----+----+-----+----+-----+----+
| Total Non-current   | 9   | 9  | 1,6 | 7  | 2,4 | 6  | 2,2 | 6  |
| Assets              | 27, | 3. | 15, | 4. | 06, | 4. | 61, | 0. |
|                     | 490 | 21 | 453 | 47 | 342 | 22 | 616 | 05 |
+---------------------+-----+----+-----+----+-----+----+-----+----+
| Total Assets        | 9   | 10 | 2,1 | 10 | 3,7 | 10 | 3,7 | 10 |
|                     | 95, | 0. | 69, | 0. | 46, | 0. | 65, | 0. |
|                     | 009 | 00 | 371 | 00 | 783 | 00 | 936 | 00 |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|                     |     |    |     |    |     |    |     |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
| Liabilities &       |     |    |     |    |     |    |     |    |
| Shareholders'       |     |    |     |    |     |    |     |    |
| Equity              |     |    |     |    |     |    |     |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
| Current Liabilities |     |    |     |    |     |    |     |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|    Accounts payable | 40, | 4. | 2   | 1  | 4   | 1  | 4   | 1  |
|                     | 195 | 04 | 96, | 3. | 26, | 1. | 26, | 1. |
|                     |     |    | 324 | 66 | 189 | 37 | 189 | 32 |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|    Accounts payable | 75, | 7. | 47, | 2. | 39, | 1. | 39, | 1. |
|   for purchase of   | 143 | 55 | 652 | 20 | 099 | 04 | 099 | 03 |
|   fixed assets      |     |    |     |    |     |    |     |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|    Long-term        | 28, | 2. | 27, | 1. | 0   | 0. | 0   | 0. |
|   loans-due within  | 645 | 88 | 684 | 28 |     | 00 |     | 00 |
|   one year          |     |    |     |    |     |    |     |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|    Short-term loans | 49, | 4. | 0   | 0. | 0   | 0. | 0   | 0. |
|   from financial    | 258 | 95 |     | 00 |     | 00 |     | 00 |
|   institutions      |     |    |     |    |     |    |     |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|    Other current    | 18, | 1. | 26, | 1. | 61, | 1. | 80, | 2. |
|   liabilities       | 481 | 86 | 175 | 21 | 478 | 64 | 631 | 15 |
+---------------------+-----+----+-----+----+-----+----+-----+----+
| Total current       | 2   | 2  | 3   | 1  | 5   | 1  | 5   | 1  |
| liabilities         | 11, | 1. | 97, | 8. | 26, | 4. | 45, | 4. |
|                     | 722 | 28 | 835 | 34 | 766 | 06 | 919 | 50 |
+---------------------+-----+----+-----+----+-----+----+-----+----+
| Non-current         | 4   | 4  | 8   | 3  | 0   | 0. | 0   | 0. |
| Liabilities         | 53, | 5. | 32, | 8. |     | 00 |     | 00 |
|                     | 473 | 57 | 616 | 38 |     |    |     |    |
|   Long-term         |     |    |     |    |     |    |     |    |
|   loans-net of      |     |    |     |    |     |    |     |    |
|   amount due within |     |    |     |    |     |    |     |    |
|   one year          |     |    |     |    |     |    |     |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
| Total Liabilities   | 6   | 6  | 1,2 | 5  | 5   | 1  | 5   | 1  |
|                     | 65, | 6. | 30, | 6. | 26, | 4. | 45, | 4. |
|                     | 195 | 85 | 451 | 72 | 766 | 06 | 919 | 06 |
+---------------------+-----+----+-----+----+-----+----+-----+----+

+---------------------+-----+----+-----+----+-----+----+-----+----+
| Polyplex (Thailand) |     |    |     |    |     |    |     |    |
| Plc.                |     |    |     |    |     |    |     |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
| Balance Sheet       |     |    |     |    |     |    |     |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
| Unit: Bt. 000’s     |     |    |     |    |     |    |     |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|                     | Un  |    |     |    |     |    | Con |    |
|                     | con |    |     |    |     |    | sol |    |
|                     | sol |    |     |    |     |    | ida |    |
|                     | ida |    |     |    |     |    | ted |    |
|                     | ted |    |     |    |     |    |     |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|                     | 2   |    | 200 |    | 200 |    | 200 |    |
|                     | 002 |    | 3/2 |    | 4/2 |    | 4/2 |    |
|                     | /20 |    | 004 |    | 005 |    | 005 |    |
|                     | 03* |    |     |    |     |    |     |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|                     | Ap  |    | Ap  |    | Ap  |    | Ap  |    |
|                     | ril |    | ril |    | ril |    | ril |    |
|                     | -Ma |    | -Ma |    | -Ma |    | -Ma |    |
|                     | rch |    | rch |    | rch |    | rch |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|                     | Amo | %  | Amo | %  | Amo | %  | Amo | %  |
|                     | unt |    | unt |    | unt |    | unt |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
| Shareholders Equity |     |    |     |    |     |    |     |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
| Issued & Paid-up    |     |    |     |    |     |    |     |    |
| Share Capital       |     |    |     |    |     |    |     |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|   Preferred shares  | 2   | 2  | 4   | 2  | 0   | 0. | 0   | 0. |
|                     | 81, | 8. | 73, | 1. |     | 00 |     | 00 |
|                     | 600 | 30 | 797 | 84 |     |    |     |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|   Ordinary shares   | 70, | 7. | 1   | 5. | 8   | 2  | 8   | 2  |
|                     | 400 | 08 | 18, | 46 | 00, | 1. | 00, | 1. |
|                     |     |    | 449 |    | 000 | 35 | 000 | 24 |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|   Premium on        | 0   | 0. | 0   | 0. | 1,3 | 3  | 1,3 | 3  |
|   ordinary shares   |     | 00 |     | 00 | 70, | 6. | 70, | 6. |
|                     |     |    |     |    | 460 | 58 | 460 | 39 |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|    Advance towards  | 536 | 0. | 2,  | 0. | 0   | 0. | 0   | 0. |
|   future paid-up    |     | 05 | 324 | 11 |     | 00 |     | 00 |
|   capital           |     |    |     |    |     |    |     |    |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|   Translation       | 0   | 0. | 0   | 0. | (1  | (0 | (1  | (0 |
|   adjustment        |     | 00 |     | 00 | 5,8 | .4 | 5,8 | .4 |
|                     |     |    |     |    | 16) | 2) | 16) | 2) |
+---------------------+-----+----+-----+----+-----+----+-----+----+
|   Retained earnings | (2  | (2 | 3   | 1  | 1,0 | 2  | 1,0 | 2  |
|   (deficits)        | 2,7 | .2 | 44, | 5. | 65, | 8. | 65, | 8. |
|                     | 22) | 8) | 349 | 87 | 373 | 43 | 373 | 29 |
+---------------------+-----+----+-----+----+-----+----+-----+----+
| Total Shareholders' | 3   | 3  | 9   | 4  | 3,2 | 8  | 3,2 | 8  |
| Equity              | 29, | 3. | 38, | 3. | 20, | 5. | 20, | 5. |
|                     | 814 | 15 | 919 | 28 | 017 | 94 | 017 | 50 |
+---------------------+-----+----+-----+----+-----+----+-----+----+
| Total Liabilities   | 9   | 10 | 2,1 | 10 | 3,7 | 10 | 3,7 | 10 |
| and Shareholders'   | 95, | 0. | 69, | 0. | 46, | 0. | 65, | 0. |
| Equity              | 009 | 00 | 371 | 00 | 783 | 00 | 936 | 00 |
+---------------------+-----+----+-----+----+-----+----+-----+----+

* The Company did not have any commercial operations during the period
ending March 31, 2003

The Company set up Polyplex (Singapore) Pte. Ltd., its subsidiary, in
July 2004 and Polyplex Europa in September 2004.

+--------------------+-----+-----+-----+----+-----+-----+-----+----+
| Polyplex           |     |     |     |    |     |     |     |    |
| (Thailand) Plc.    |     |     |     |    |     |     |     |    |
+====================+=====+=====+=====+====+=====+=====+=====+====+
| Statement of       |     |     |     |    |     |     |     |    |
| Income and         |     |     |     |    |     |     |     |    |
| Retained Earnings  |     |     |     |    |     |     |     |    |
+--------------------+-----+-----+-----+----+-----+-----+-----+----+
| Unit: Bt. 000’s    |     |     |     |    |     |     |     |    |
+--------------------+-----+-----+-----+----+-----+-----+-----+----+
|                    | Un  |     |     |    |     |     | Con |    |
|                    | con |     |     |    |     |     | sol |    |
|                    | sol |     |     |    |     |     | ida |    |
|                    | ida |     |     |    |     |     | ted |    |
|                    | ted |     |     |    |     |     |     |    |
+--------------------+-----+-----+-----+----+-----+-----+-----+----+
|                    | 2   |     | 200 |    | 200 |     | 200 |    |
|                    | 002 |     | 3/2 |    | 4/2 |     | 4/2 |    |
|                    | /20 |     | 004 |    | 005 |     | 005 |    |
|                    | 03* |     |     |    |     |     |     |    |
+--------------------+-----+-----+-----+----+-----+-----+-----+----+
|                    | Ap  |     | Ap  |    | Ap  |     | Ap  |    |
|                    | ril |     | ril |    | ril |     | ril |    |
|                    | -Ma |     | -Ma |    | -Ma |     | -Ma |    |
|                    | rch |     | rch |    | rch |     | rch |    |
+--------------------+-----+-----+-----+----+-----+-----+-----+----+
|                    | Amo | %   | Amo | %  | Amo | %   | Amo | %  |
|                    | unt |     | unt |    | unt |     | unt |    |
+--------------------+-----+-----+-----+----+-----+-----+-----+----+
|                    |     |     |     |    |     |     |     |    |
+--------------------+-----+-----+-----+----+-----+-----+-----+----+
| Revenues           |     |     |     |    |     |     |     |    |
+--------------------+-----+-----+-----+----+-----+-----+-----+----+
|   Net sales        | 0   | 0   | 1,6 | 9  | 3,2 | 97  | 3,2 | 9  |
|                    |     | .00 | 45, | 5. | 62, | .27 | 62, | 7. |
|                    |     |     | 470 | 79 | 965 |     | 965 | 26 |
+--------------------+-----+-----+-----+----+-----+-----+-----+----+
|   Other revenues   | 890 | 217 | 34, | 1. | 74, | 2   | 74, | 2. |
|                    |     | .60 | 268 | 99 | 641 | .23 | 700 | 23 |
+--------------------+-----+-----+-----+----+-----+-----+-----+----+
|   Gain/(loss) on   | (4  | (1  | 38, | 2. | 16, | 0   | 17, | 0. |
|   foreign exchange | 81) | 17. | 108 | 22 | 882 | .50 | 353 | 51 |
|                    |     | 60) |     |    |     |     |     |    |
+--------------------+-----+-----+-----+----+-----+-----+-----+----+
| Total Revenues     | 409 | 100 | 1,7 | 10 | 3,3 | 100 | 3,3 | 10 |
|                    |     | .00 | 17, | 0. | 54, | .00 | 55, | 0. |
|                    |     |     | 846 | 00 | 488 |     | 018 | 00 |
+--------------------+-----+-----+-----+----+-----+-----+-----+----+
| Costs and          |     |     |     |    |     |     |     |    |
| Expenses           |     |     |     |    |     |     |     |    |
+--------------------+-----+-----+-----+----+-----+-----+-----+----+
|   Cost of sales    | 0   | 0   | 1,1 | 6  | 2,2 | 68  | 2,2 | 6  |
|                    |     | .00 | 79, | 8. | 89, | .24 | 89, | 8. |
|                    |     |     | 123 | 64 | 166 |     | 166 | 23 |
+--------------------+-----+-----+-----+----+-----+-----+-----+----+
|   Selling and      | 22, | 5,  | 1   | 8. | 3   | 9   | 3   | 9. |
|   administrative   | 840 | 584 | 45, | 45 | 03, | .04 | 18, | 49 |
|   expenses         |     | .38 | 168 |    | 370 |     | 505 |    |
+--------------------+-----+-----+-----+----+-----+-----+-----+----+
|   Loss from        | 0   | 0   | 0   | 0. | 14, | 0   | 0   | 0. |
|   investment in    |     | .00 |     | 00 | 605 | .44 |     | 00 |
|   subsidiary       |     |     |     |    |     |     |     |    |
+--------------------+-----+-----+-----+----+-----+-----+-----+----+
| Total Expenses     | 22, | 5,  | 1,3 | 7  | 2,6 | 77  | 2,6 | 7  |
|                    | 840 | 584 | 24, | 7. | 07, | .72 | 07, | 7. |
|                    |     | .38 | 291 | 09 | 141 |     | 671 | 72 |
+--------------------+-----+-----+-----+----+-----+-----+-----+----+
| Profit (loss)      | (2  | (   | 3   | 2  | 7   | 22  | 7   | 2  |
| before interest    | 2,4 | 5,4 | 93, | 2. | 47, | .28 | 47, | 2. |
| expenses           | 31) | 84. | 555 | 91 | 347 |     | 347 | 28 |
|                    |     | 38) |     |    |     |     |     |    |
+--------------------+-----+-----+-----+----+-----+-----+-----+----+
| Interest expenses  | (1  | (   | (2  | (1 | (2  | (0  | (2  | (0 |
|                    | 26) | 30. | 6,4 | .5 | 6,3 | .78 | 6,3 | .7 |
|                    |     | 73) | 84) | 4) | 23) | )   | 23) | 8) |
+--------------------+-----+-----+-----+----+-----+-----+-----+----+
| Net profit (loss)  | (2  | (   | 3   | 2  | 7   | 21  | 7   | 2  |
|                    | 2,5 | 5,5 | 67, | 1. | 21, | .50 | 21, | 1. |
|                    | 57) | 15. | 071 | 37 | 024 |     | 024 | 50 |
|                    |     | 12) |     |    |     |     |     |    |
+--------------------+-----+-----+-----+----+-----+-----+-----+----+
| Earnings (losses)  | (3. | (0. | 35  | 0. | 1   | 0   | 1   | 0. |
| per share (Bt.)    | 14) | 77) | .94 | 00 | .58 | .00 | .58 | 00 |
+--------------------+-----+-----+-----+----+-----+-----+-----+----+

* The Company did not have any commercial operations during the period
ending March 31, 2003

The Company set up Polyplex (Singapore) Pte. Ltd., its subsidiary, in
July 2004 and Polyplex Europa in September 2004.

+---------------------------------+---------+-------+-------+---------+
| Polyplex (Thailand) Public      |         |       |       |         |
| Company Limited                 |         |       |       |         |
+=================================+=========+=======+=======+=========+
| Cash Flow Statement             |         |       |       |         |
+---------------------------------+---------+-------+-------+---------+
| Unit : Bt. 000’s                |         |       |       |         |
+---------------------------------+---------+-------+-------+---------+
|                                 | Unconso |       |       | Conso   |
|                                 | lidated |       |       | lidated |
+---------------------------------+---------+-------+-------+---------+
|                                 | 200     | 2003  | 2004  | 20      |
|                                 | 2/2003* | /2004 | /2005 | 04/2005 |
|                                 |         |       |       |         |
|                                 | Apri    | A     | A     | Apri    |
|                                 | l-March | pril- | pril- | l-March |
|                                 |         | March | March |         |
+---------------------------------+---------+-------+-------+---------+
|                                 |         |       |       |         |
+---------------------------------+---------+-------+-------+---------+
| Cash flow from operating        |         |       |       |         |
| activities                      |         |       |       |         |
+---------------------------------+---------+-------+-------+---------+
| Net profit (loss)               | (       | 36    | 72    | 721,024 |
|                                 | 22,557) | 7,071 | 1,024 |         |
+---------------------------------+---------+-------+-------+---------+
| Adjustment to reconcile net     |         |       |       |         |
| profit of net cash provided by  |         |       |       |         |
| operating activities            |         |       |       |         |
+---------------------------------+---------+-------+-------+---------+
|   Depreciation and amortization | 1,535   | 6     | 10    | 109,037 |
|                                 |         | 8,545 | 8,790 |         |
+---------------------------------+---------+-------+-------+---------+
|   Unrealized losses (gains) on  | 0       | 0     | (155) | (155)   |
|   marketable securities         |         |       |       |         |
+---------------------------------+---------+-------+-------+---------+
|   Unrealized losses (gains) on  | 2,483   | (48   | (5    | (5,036) |
|   foreign exchange              |         | ,267) | ,036) |         |
+---------------------------------+---------+-------+-------+---------+
|   Loss from subsidiary          | 0       | 0     | 1     | 0       |
|                                 |         |       | 4,605 |         |
+---------------------------------+---------+-------+-------+---------+
|   Exchange differences on       | 0       | 0     | 0     | (       |
|   translation of FS of          |         |       |       | 12,314) |
|   subsidiary                    |         |       |       |         |
+---------------------------------+---------+-------+-------+---------+
| Profit (Loss) from operation    | (       | 38    | 83    | 812,556 |
| before changes in operating     | 18,539) | 7,349 | 9,229 |         |
| assets and liabilities          |         |       |       |         |
+---------------------------------+---------+-------+-------+---------+
| Decrease (Increase) in          |         |       |       |         |
| operating assets                |         |       |       |         |
+---------------------------------+---------+-------+-------+---------+
| Investment in marketable        |  0      | 0     | (100  | (1      |
| securities                      |         |       | ,608) | 00,608) |
+---------------------------------+---------+-------+-------+---------+
| Accounts receivable             | 0       | (337  | (286  | (2      |
|                                 |         | ,497) | ,758) | 86,758) |
+---------------------------------+---------+-------+-------+---------+
| Balance due from a related      | 0       | 0     | 0     | 0       |
| company                         |         |       |       |         |
+---------------------------------+---------+-------+-------+---------+
| Inventories                     | (       | (110  | (160  | (1      |
|                                 | 34,513) | ,645) | ,531) | 60,531) |
+---------------------------------+---------+-------+-------+---------+
| Other current assets            | (       | (29   | (30   | (       |
|                                 | 12,457) | ,037) | ,577) | 34,092) |
+---------------------------------+---------+-------+-------+---------+
| Other non-current assets        | (4,230) | (4    | (4    | (4,469) |
|                                 |         | ,853) | ,469) |         |
+---------------------------------+---------+-------+-------+---------+
| Increase (Decrease) in          |         |       |       |         |
| operating liabilities           |         |       |       |         |
+---------------------------------+---------+-------+-------+---------+
| Accounts payable                | 40,728  | 25    | 12    | 129,312 |
|                                 |         | 8,169 | 9,312 |         |
+---------------------------------+---------+-------+-------+---------+
| Retention money                 | 7,456   | (5    | 2,291 | 2,291   |
|                                 |         | ,221) |       |         |
+---------------------------------+---------+-------+-------+---------+
| Other current liabilities       | 10,860  | 1     | 3     | 52,419  |
|                                 |         | 1,695 | 3,012 |         |
+---------------------------------+---------+-------+-------+---------+
| Cash flow provided from (used   | (       | 16    | 42    | 410,120 |
| in) operating activities        | 10,696) | 9,961 | 0,901 |         |
+---------------------------------+---------+-------+-------+---------+
|                                 |         |       |       |         |
+---------------------------------+---------+-------+-------+---------+
| Cash flow from Investing        |         |       |       |         |
| activities                      |         |       |       |         |
+---------------------------------+---------+-------+-------+---------+
|   Repayment of accounts payable | 0       | (75   | (47   | (       |
|   on purchase of fixed assets   |         | ,143) | ,652) | 47,652) |
+---------------------------------+---------+-------+-------+---------+
|   Purchase of fixed assets      | (8      | (704  | (429  | (7      |
|                                 | 50,401) | ,789) | ,432) | 13,066) |
+---------------------------------+---------+-------+-------+---------+
|   Investment in subsidiary      | 0       | 0     | (454  | 0       |
|                                 |         |       | ,826) |         |
+---------------------------------+---------+-------+-------+---------+
| Net cash used in investing      | (8      | (779  | (931  | (7      |
| activities                      | 50,401) | ,932) | ,910) | 60,718) |
+---------------------------------+---------+-------+-------+---------+
|                                 |         |       |       |         |
+---------------------------------+---------+-------+-------+---------+
| Cash flow from financing        |         |       |       |         |
| activities                      |         |       |       |         |
+---------------------------------+---------+-------+-------+---------+
|   Increase (Decrease) in loans  | 49,258  | (49   | 0     | 0       |
|   from financial institutions   |         | ,259) |       |         |
+---------------------------------+---------+-------+-------+---------+
|   Increase in long-term loans   | 479,102 | 42    | 19    | 192,743 |
|                                 |         | 3,790 | 2,743 |         |
+---------------------------------+---------+-------+-------+---------+
|   Repayment of long-term loans  | 0       | 0     | (     | (1,0    |
|                                 |         |       | 1,053 | 53,043) |
|                                 |         |       | ,043) |         |
+---------------------------------+---------+-------+-------+---------+
|   Cash receivable capital       | 351,900 | 24    | 2,04  | 2,      |
|   increase                      |         | 0,247 | 9,687 | 049,687 |
+---------------------------------+---------+-------+-------+---------+
|   Decrease in Preferred Shares  | 0       | 0     | (473  | (4      |
|                                 |         |       | ,798) | 73,798) |
+---------------------------------+---------+-------+-------+---------+
|   Advance towards future        | 536     | 1,788 | 0     | 0       |
|   paid-up capital               |         |       |       |         |
+---------------------------------+---------+-------+-------+---------+
| Cash provided from financing    | 880,796 | 61    | 71    | 715,589 |
| activities                      |         | 6,566 | 5,589 |         |
+---------------------------------+---------+-------+-------+---------+
|                                 |         |       |       |         |
+---------------------------------+---------+-------+-------+---------+
| Increase in cash and cash       | 19,699  | 6,594 | 20    | 364,992 |
| equivalents                     |         |       | 4,580 |         |
+---------------------------------+---------+-------+-------+---------+
|                                 |         |       |       |         |
+---------------------------------+---------+-------+-------+---------+
| Cash and cash equivalents at    | 100     | 1     | 2     | 26,393  |
| the beginning of period (April  |         | 9,799 | 6,393 |         |
| 1)                              |         |       |       |         |
+---------------------------------+---------+-------+-------+---------+
|                                 |         |       |       |         |
+---------------------------------+---------+-------+-------+---------+
| Cash and Cash equivalents at    | 19,799  | 2     | 23    | 391,385 |
| the end of period (March 31)    |         | 6,393 | 0,973 |         |
+---------------------------------+---------+-------+-------+---------+

* The Company did not have any commercial operations during the period
ending March 31, 2003

+-----------------------------+----+-------+-------+-------+---------+
| Polyplex (Thailand) Public  |    |       |       |       |         |
| Company Limited             |    |       |       |       |         |
+=============================+====+=======+=======+=======+=========+
| Financial Statement         |    |       |       |       |         |
+-----------------------------+----+-------+-------+-------+---------+
|                             |    | Unco  |       |       | Conso   |
|                             |    | nsoli |       |       | lidated |
|                             |    | dated |       |       |         |
+-----------------------------+----+-------+-------+-------+---------+
|                             |    | 2002/ | 2003  | 2004  | 20      |
|                             |    | 2003* | /2004 | /2005 | 04/2005 |
|                             |    |       |       |       |         |
|                             |    | A     | A     | A     | Apri    |
|                             |    | pril- | pril- | pril- | l-March |
|                             |    | March | March | March |         |
+-----------------------------+----+-------+-------+-------+---------+
| Liquidity Ratios            |    |       |       |       |         |
+-----------------------------+----+-------+-------+-------+---------+
|   Current ratio             | (t | 0.32  | 1.39  | 2.54  | 2.76    |
|                             | im |       |       |       |         |
|                             | e) |       |       |       |         |
+-----------------------------+----+-------+-------+-------+---------+
|   Quick ratio               | (t | 0.09  | 0.92  | 1.63  | 1.87    |
|                             | im |       |       |       |         |
|                             | e) |       |       |       |         |
+-----------------------------+----+-------+-------+-------+---------+
|   Cash flow current ratio   | (t | (     | 0.56  | 1.13¹ | 1.08¹   |
|                             | im | 0.10) |       |       |         |
|                             | e) |       |       |       |         |
+-----------------------------+----+-------+-------+-------+---------+
|   Receivable current ratio  | (t | N.A.  | 9.70  | 6.74  | 6.74    |
|                             | im |       |       |       |         |
|                             | e) |       |       |       |         |
+-----------------------------+----+-------+-------+-------+---------+
|   Avg. debt collection      | (  | N.A.  | 37.12 | 53.44 | 53.44   |
|   period                    | da |       |       |       |         |
|                             | y) |       |       |       |         |
+-----------------------------+----+-------+-------+-------+---------+
|   Inventory turnover period | (t | 0.00  | 45.08 | 38.35 | 38.35   |
|                             | im |       |       |       |         |
|                             | e) |       |       |       |         |
+-----------------------------+----+-------+-------+-------+---------+
|   Avg. selling period       | (  | N.A.  | 7.99  | 9.39  | 9.39    |
|                             | da |       |       |       |         |
|                             | y) |       |       |       |         |
+-----------------------------+----+-------+-------+-------+---------+
|   Payable current ratio     | (t | 0.00  | 7.01  | 6.34  | 6.34    |
|                             | im |       |       |       |         |
|                             | e) |       |       |       |         |
+-----------------------------+----+-------+-------+-------+---------+
|   Loan repayment period     | (  | N.A.  | 51.37 | 56.81 | 56.81   |
|                             | da |       |       |       |         |
|                             | y) |       |       |       |         |
+-----------------------------+----+-------+-------+-------+---------+
|   Cash cycle                | (  | N.A.  | (     | 6.02  | 6.02    |
|                             | da |       | 6.26) |       |         |
|                             | y) |       |       |       |         |
+-----------------------------+----+-------+-------+-------+---------+
| Profitability Ratios        |    |       |       |       |         |
+-----------------------------+----+-------+-------+-------+---------+
| Gross profit margin         | (  | N.A.  | 2     | 2     | 29.84%  |
|                             | %) |       | 8.34% | 9.84% |         |
+-----------------------------+----+-------+-------+-------+---------+
| Operating profit margin     | (  | N.A.  | 1     | 2     | 20.08%  |
|                             | %) |       | 9.52% | 0.55% |         |
+-----------------------------+----+-------+-------+-------+---------+
| Other profit margin         | (  | 21    | 1.99% | 2.23% | 2.23%   |
|                             | %) | 7.60% |       |       |         |
+-----------------------------+----+-------+-------+-------+---------+
| Cash to profit margin       | (  | 4     | 4     | 68    | 68.34%¹ |
|                             | %) | 7.68% | 3.19% | .44%¹ |         |
+-----------------------------+----+-------+-------+-------+---------+
| Net profit margin           | (  | N.A.  | 2     | 2     | 21.49%  |
|                             | %) |       | 1.37% | 1.49% |         |
+-----------------------------+----+-------+-------+-------+---------+
| Return on equity            | (  | (6    | 5     | 3     | 34.67%  |
|                             | %) | .84)% | 7.86% | 4.67% |         |
+-----------------------------+----+-------+-------+-------+---------+
| Efficiency Ratios           |    |       |       |       |         |
+-----------------------------+----+-------+-------+-------+---------+
| Return on assets            | (  | N.A.  | 2     | 2     | 24.30%  |
|                             | %) |       | 3.20% | 4.37% |         |
+-----------------------------+----+-------+-------+-------+---------+
| Return on fixed assets      | (  | N.A.  | 2     | 2     | 27.97%  |
|                             | %) |       | 7.53% | 8.05% |         |
+-----------------------------+----+-------+-------+-------+---------+
| Asset turnover              | (t | N.A.  | 1.09  | 1.13  | 1.13    |
|                             | im |       |       |       |         |
|                             | e) |       |       |       |         |
+-----------------------------+----+-------+-------+-------+---------+
| Financial Policy Ratios     |    |       |       |       |         |
+-----------------------------+----+-------+-------+-------+---------+
| Debt to equity ratio        | (t | 2.02  | 1.31  | 0.16  | 0.17    |
|                             | im |       |       |       |         |
|                             | e) |       |       |       |         |
+-----------------------------+----+-------+-------+-------+---------+
| Interest coverage ratio     | (t | N.A.  | 7.42  | 20.81 | 20.40   |
|                             | im |       |       |       |         |
|                             | e) |       |       |       |         |
+-----------------------------+----+-------+-------+-------+---------+
| Commitment coverage ratio   | (t | N.A.  | 0.23  | 1.14  | 0.69    |
| (cash basis)                | im |       |       |       |         |
|                             | e) |       |       |       |         |
+-----------------------------+----+-------+-------+-------+---------+
| Pay out ratio               | (  | -     | -     | -     | -       |
|                             | %) |       |       |       |         |
+-----------------------------+----+-------+-------+-------+---------+

* The Company did not have any commercial operations during the period
ending March 31, 2003

¹Ratios for 2004/05 are calculated prior to netting off investments in
marketable securities from cash flow from operating activities

12.2 Explanation and analysis of operational performance and financial
status

1.  Operational performance

PTL, a subsidiary of PCL, was incorporated on March 26, 2002 to engage
in the production and distribution of PET film (Polyethylene
Terephthalate Film or Polyester Film) mainly for export markets focusing
on packaging, industrial and electrical segments. The Company commenced
the operation of its first production line on April 2, 2003 and the
second production line on November 12 of the same year. The Company’s
factory is situated in Siam Eastern Industrial Park, Rayong on a land
area of 20 rai 22 sq. wah. It was awarded the ISO 9001:2000 and the
ISO14001:1996 accreditation in December 2003 and May 2004 respectively.

The Company has targeted to become the world market leader on PET film
with market share increase through expanding its customer base and
endeavoring into new product lines, such as metallized film and special
transparent film. To such end, it has set out clear business strategies,
i.e. 1) enhancing the potential to penetrate high growth market, 2)
leading in competitive cost, 3) boosting delivery efficiency through
focus on production base that has easy access to customers, and 4)
diversifying the product lines.

PTL was set up in 2002 and started commercial production with income
generations since April 2003. Thus, the 2002/2003 financial statement
cannot be used for comparison. In 2003/2004 (April 1, 2003-March 31,
2004) the Company recorded total revenues of Bt. 1,717.85 million. In
2004/2005 (April 1, 2004- March 31, 2005) PTL and its subsidiary posted
total revenues of Bt. 3,355.02 million a 95.30% increase from
corresponding previous year. The considerable increase was attributable
to the Company’s utilization of both film lines capacity for the entire
year as also improvement in productivity levels in the year 2004/2005.

Revenues

During its first year of operation, 2003/2004 (April 1, 2003-March 31,
2004), the Company recorded total revenues from sales of Bt. 1,645.47
million. Of this total, 90.49% or Bt. 1,489.05 million came from export
sales and 9.51% or Bt. 156.42 million from local sales. It is apparent
that PTL largely concentrates on the overseas markets, fostered by its
parent company’s longstanding relationship with the overseas customers
and experience in the export markets for some 16 years which helped
build up its name recognition and reliability among these customers.

Table illustrating PTL’s export and domestic sales

  ------------------------- ---------- ----------- ----------- -----------
  Market                    2003/04                2004/05     

                            Bt.        %           Bt. million %
                            million                            

  Exports                   1,489.05   90.49%      2,900.51    88.90%

  Domestic sales            156.42     9.51%       362.45      11.10%

  Total                     1,645.47   100%        3,262.96    100%
  ------------------------- ---------- ----------- ----------- -----------

In the year 2004/2005 (April 1- March 31, 2005), PTL achieved total
sales revenues of Bt. 3,262.96 million, an increase of 98.30% over the
previous year. This is attributable to two key factors:

-   Full operations of both film lines during the year 2004/2005.

-   Achievement of a capacity utilization of 98% in 2004/2005 as against
    96% during the first year of operations

Expenses

The key elements of PTL’s cost structure are raw materials (PET resin),
packing, electricity & fuel, staff cost and the selling & administrative
expenses.

Raw material cost made up 67% and 70% of total expenses in 2003/04 and
2004/05 respectively, followed by packing 6.06% and 5.51%, electricity &
water 4.17% and 3.41%, and staff salaries 3.27% and 1.80%. The selling &
administrative expenses amounted to Bt. 145.17 million and Bt. 318.51
million in 2003/04 and 2004/05 (consolidated) respectively. They
principally included the shipment cost for the exported items, which was
4.95% and 6.18% of the total expenses respectively over the same periods

The increase in the per unit cost of raw material is a global phenomenon
in the PET film industry resulting from the increase in crude oil prices
and the tight demand-supply situation for PTA and MEG. The raw material
cost adjusted for variation in stocks increased from an average of Bt.
37.07/ kg in 2003/2004 to Bt. 46.38/ kg during 2004/2005; an increase of
25.12%. The other variable costs per unit declined marginally during the
year 2004/2005. With the increase in the production volumes, the fixed
costs are getting defrayed over a larger base off-setting the increase
in the raw material costs. The fixed manufacturing costs declined from
Bt. 12.15/ kg in 2003/04 to Bt. 9.30/ kg in 2004/2005. However, selling
and administrative expenses increased from Bt. 6.50/ kg to Bt. 8.25/ kg
partly due to large IPO expenses as also startup expenses of subsidiary.
The incidence of interest cost on a per kg basis has declined with an
increase in volumes and prepayment of loans.

Overall, the unit cost of sales increased by only about 19.10% in spite
of the higher increase in raw material costs.

During the year 2004/2005, the Company earned an extraordinary income of
Bt. 17.35 million as against Bt. 38 million in the corresponding
previous year on account of foreign exchange fluctuation with the Baht
depreciating against the US dollar.

Gross profit

During 2004/2005, the Company had a gross profit margin of 29.84%, a
slight increase from 28.34% in the previous year on account of decrease
in fixed costs and with part of the cost increase passed on to the
customers, hence compensating for the rising raw material cost per unit.
It also recorded increase in the operating profit with margins
increasing from 19.52% in 2003/2004 to 20.08% in 2004/2005.

Net profit

Prior to the commencement of commercial operation in 2002/2003 (ended
March 31, 2003), PTL posted a net loss of Bt. 22.56 million because it
had not begun the production and distribution of PET film and, hence,
only incurred pre-operating expenses. The total expenses comprised
administrative expenses of Bt. 22.84 million and interest expenses of
Bt. 0.13 million.

In the first year of its commercial operations during 2003/2004, the
Company posted a net profit of Bt. 367.07 million or 21.37% of its total
income. There is a 96.43% increase in the net profits for the year
2004/2005 over 2003/2004 on account of the large increase in sales
volumes. The net profit during the year 2004/2005 is Bt. 721.02 million,
a net margin of 21.49%. Excluding the extraordinary gain on foreign
exchange in both periods, the net profit margin during the year
2004/2005 was higher than the previous year by about 113.90%.

This was attributable to the fact that the Company started to run
production lines 1 and 2 on April 2, 2003 and November 12, 2003
respectively and thus only part of the capacity was operational during
2003/2004 and productivity was also lower during the initial months
after the start-up of each of the production lines.

Return on equity

In 2002/2003, the Company generated a negative return on equity (ROE) of
7%, caused by the fact that it had not yet come into operation and
accordingly did not earn any sales revenues. In 2003/2004, the ROE
surged to 58% as it was the first year of its commercial operation. For
the year 2004/2005, ROE stood at 34.67% due to a rise of Bt. 2281.10
million in the shareholders’ equity following a capital increase and the
net profit during the year of Bt. 721.02 million.

PTL has a policy to pay dividend at about 40% of net profits, although
no dividend was paid upto 2003/2004 in order to fund growth plans and
working capital requirements. In 2004/2005, the company declared a
dividend of 35 satang per share on a par value of Baht 1 each share.

2.  Financial status

Total assets

PTL’s total assets have grown steadily from Bt. 995.01 million as of
March 31, 2003 when its first production line was about to be
commissioned to Bt. 2,169.37 million as of March 31, 2004 with both its
two PET film production lines in operation and Bt. 3,765.94 million as
of March 31, 2005 with the increase coming mostly from the PET resin
plant, investment in subsidiary and investment in short term marketable
securities. The Company’s fixed assets were Bt. 1,608.88 million and Bt.
2,257.15 million respectively in 2003/2004 and 2004/2005 which
constituted about 74.16% and 59.94% of the total assets respectively.

Asset quality

The number of days for the various elements of working capital has been
computed as average of opening and closing levels. However, since
commercial operations were started on April 2, 2003, the opening balance
for 2002/2003 (April 2002 to March 2003) is not a true reflection of the
actual business position resulting in understated periods for average
collection period, inventories, creditors, cash cycle etc.

Accounts receivable

The average collection period was 37 days (74 days based on closing
balance only) and 53 days in 2003/2004 and 2004/2005 (70 days based on
closing balance only) respectively. The Company’s collection policy is
15 – 60 days (for domestic customers) and 30 – 150 days based on the
agreed credit terms for the individual export customers. Its net
accounts receivable as of March 31, 2004 stood at Bt. 339.34 million and
then rose by 85.48%, a rate lower than rate of growth for sales
revenues, to Bt. 629.41 million as of March 31, 2005, arising from the
growth in sales revenues.

PTL’s outstanding accounts receivable can be classified as shown below:

(Bt. million)

+---------------------------+-------------------+----------------------+
| Period                    | 2003/04           | 2004/05              |
|                           |                   |                      |
|                           | (Apr 1, 03 – Mar  | (Apr 1, 04 – March   |
|                           | 31, 04)           | 31, 05)              |
+---------------------------+-------------------+----------------------+
| Not yet due to overdue of | 306.06            | 577.57               |
| less than 1 month         |                   |                      |
+---------------------------+-------------------+----------------------+
| Overdue between 1-3       | 33.28             | 51.84                |
| months                    |                   |                      |
+---------------------------+-------------------+----------------------+
| Total                     | 339.34            | 629.41               |
+---------------------------+-------------------+----------------------+

Inventories

The Company had total inventories of Bt. 145.16 million in 2003/2004 and
Bt. 305.69 in 2004/2005, with average selling period of 7.99 days (15
days on closing balance only) and 9.39 days (11 days on closing balance
only) respectively. The Company aligns its supply chain (raw material
procurement, production and dispatch) in a manner that minimum levels of
inventories are required to be maintained

Return of assets

The Company had a return on assets of 23.2% during 2003/2004 which
further increased to 24.30% during 2004/2005. The high return can be
attributed to the following two key reasons:

-   The profitability margins of the company were high during these
    periods resulting from the high productivity.

-   The high capacity utilization also resulted in a better utilization
    of the fixed assets of the Company as reflected in the asset
    turnover ratio of 1.13 for the year 2004/2005.

3.  Liquidity

Cash flow

In 2003/2004, PTL’s and its subsidiary’s major sources of funds were
cash flow from operations of Bt. 169.96 million and cash flow from
borrowings and capital increase of Bt. 616.57 million. Of these, Bt.
779.93 million was used for purchase of machinery & equipment and other
fixed assets. The balance thereof plus the beginning balance of Bt.
19.80 million resulted in a net ending balance of Bt. 26.39 million.

In the year 2004/2005,,PTL and its subsidiary showed a cash flow from
operations of Bt. 410.12 million and cash flow from capital increase of
Bt. 715.59 million. Of these, Bt. 760.72 million was used for purchase
of machinery & equipment and other fixed assets. The balance thereof
plus the beginning balance of Bt. 26.39 million resulted in a net ending
balance of Bt. 391.39 million.

Liquidity ratio

PTL’s and its subsidiary’s liquidity ratio is high, with current ratio
of 1.39 and 2.76 and quick ratio of 0.92 and 1.87 in 2003/2004 and
2004/2005 respectively, as a result of the average debt collection
period of 37 days and 53 days in 2003/2004 and 2004/2005 respectively,
compared with the loan repayment period of 51 days and 57 days over the
same period. The resultant cash cycle was -6.26 days (-1 day based on
the end of period balance) and 6.02 days (13 days based on the end of
period balance) in 2003/2004 and 2004/2005 respectively.

4.  Sources of funds

PTL and its subsidiary’s sources of funds consist of loans from
financial institutions and shareholders’ equity.

Total liabilities

In 2003/2004 and 2004/2005, total liabilities stood at Bt. 1,230.45
million and Bt. 545.92 million, down by 57.20% from Bt. 1,230.45 million
as of the end of March 2004. This resulted due to prepayment of entire
outstanding long-term loans.

The total liabilities in 2003/2004 and 2004/2005 were composed of
current liabilities of Bt. 397.84 million and Bt. 545.92 million,
respectively. The long-term liabilities in 2003/2004 was the balance
outstanding for borrowings from two local financial institutions against
a total sanctioned loan amount of USD 29.5 million. The loans were to
finance two projects as below:

1.  PET film project

2.  PET resin project

Entire amount of outstanding long term loans have been prepaid during
the year 2004/2005 In 2003/2004, the accounts payable stood at Bt.
296.32 million which rose to Bt. 426.19 million in 2004/2005,
representing an increase of 43.83% over the previous year, boosted by an
increase in purchase of raw materials to feed both film production
lines.

Commitments

As of March 31, 2005, PTL had the following commitments:

a) Letters of credit that have not yet been used from local banks
totaling USD 4.8 million;

b) Contingent liabilities from letters of guarantee issued by local
banks for the Company to government agencies and other agencies totaling
about Bt. 1.2 million.

.

As of March 31, 2004, PTL had the following commitments:

a) Letters of credit that have not yet been used from local banks
totaling USD 3.15 million;

b) Contingent liabilities from letters of guarantee issued by local
banks for the Company to government agencies and other agencies totaling
about Bt. 1.2 million.

Shareholders’ equity

Shareholders’ equity rose from Bt. 329.81 million in 2002/2003 to Bt.
938.92 million in 2003/2004 and Bt. 3,220.02 million in 2004/2005,
representing a growth rate of 184.68% and 242.95% respectively. In
2002/2003 and 2003/2004, the Company increased the paid-up capital by
Bt. 351.84 million and Bt. 240.25 million. It also had retained earnings
of Bt. 344.35 million, as a result of the net profit of Bt. 367.07
million generated in 2003/2004. The Company did not declare any dividend
out of its profit upto 2003/2004.

The shareholders’ equity in 2004/2005 totaled Bt. 3,220.02 million, up
from Bt. 938.92 million as of March 31, 2004. This comprised an increase
in share capital of Bt. 205.43 million and premium on common shares of
Bt. 1,370.46 million. The company also had total retained earnings of
Bt. 1,065.37 million as on March 31^(st); 2005, which is mainly due to a
net profit of Bt. 721 million earned in 2004/2005.

Leveraging & interest coverage

The debt-equity ratio of the Company has come down over the last two
years from 2.02 times as of March 31, 2003 to 1.31 times as of March 31,
2004 and 0.17 times as of March 31, 2005. The interest coverage ratio
for the Company was 20.40 times in 2004/2005.

1.  Main factors and influence which may affect the future operational
    performance and financial position

  The outlook for future remains stable as PTL would be able to derive
  the benefit from its various projects in 2005-06 as under:

  1. Full benefit from the commencement of PET resin production to serve
  the Company’s raw material demand would be available during 2005-06.
  The main advantages of the resin plant would be a lower cost of
  production because of efficiencies in raw material sourcing as also a
  lower conversion cost besides ensuring timely availability of raw
  material for the film plants. Easy availability of PTA and MEG would
  also reduce the supply risk. Captive production of resin would also
  allow PTL to develop new film products.

  2. Establishment of a new metallized film line in June-2005 to add
  value to the product, with a capacity of 7,500 tons/year. This will
  help PTL produce value added films and sell additional volumes to its
  existing as well as new customers. The Company has planned to use Baht
  100 million of the proceeds obtainable from the IPO to purchase
  machinery for the metallized film line. In the production, there will
  be expenses on the maintenance of machinery and additional recruitment
  of personnel as well as accounting expenses relating to depreciation
  of machinery throughout the useful life.

  3. Polyplex (Singapore) Pte. Ltd., a holding company, has been set up
  to invest in a PET film plant in Turkey so as to serve the markets in
  Europe, the Middle East, Africa and the CIS/Russia (see more details
  in Section 6). With such establishment in Turkey, the Company will be
  able to serve the Western European customers whose demand is high. The
  project is at an advanced stage and is likely to commence production
  from its Pet film line by October-2005 and thus add significant
  production/sales volumes to the consolidated operations of PTL. The
  commencement of production from the Metallizer plant in Turkey toward
  early part of 2006 would further broaden and improve the product mix
  of the Turkey operations. The likely installation of a Pet resin plant
  in Turkey would further add to the viability of the location based on
  similar experience in India and Thailand.

12.4 Remuneration for auditor/s

1.  Audit fee

  The Company and its subsidiaries paid audit fee as below:

  - A total of Bt - paid to the auditor/s for the past fiscal year; and

-   A total of Bt 900,000.00 paid to the accounting firm the auditor/s
    work for, or the person or business related to the auditor/s and the
    accounting firm for the past fiscal year.

2.  Non-audit fee

  The Company and its subsidiaries made payment for other services, i.e.
  due

  diligence, non-accounting advisory service, examination of compliance
  with

  conditions of promotion certificates, and legal and tax services, as
  follows:

-   A total of Bt. - paid to the auditor/s for the past fiscal year and
    Bt.________ - payable in the future for the service not yet fully
    done for the past fiscal year; and

-   A total of Bt 1,634,940.00 paid to the accounting firm the auditor/s
    work for, or the person or business related to the auditor/s and the
    accounting firm for the past fiscal year, and Bt. 150,000.00 payable
    in the future for the service not yet fully done for the past fiscal
    year.