Executive Summary

The Siam Cement Public Company Limited is the holding company of The
Siam Cement Group, which is the largest Thai conglomerate consisting of
5 strategic business units and 2 holding companies. Five core business
units are, Cement Business, Petrochemical Business, Paper and Packaging
Business, Building Products Business, and Distribution Business. Two
holding companies comprises Cementhai Holding Co. Ltd., overseeing the
Group’s investment, and Cementhai Property (2001) Public Company
Limited, managing the Group’s industrial estate and real estate.

In 2003, amidst the Middle East war and SARS epidemic, country demand
and regional demand in the Group’s products rose, especially in plastic,
cement, and paper, leading to much better performance of the Group. This
is the consequence of growing local market and the fact that every
business can devise its business strategy and organizational culture to
increase production efficiency, domestic sales, export to utilize its
capacity; and reduce production cost, administration expense, interest
expense, financial expenses, and other expenses to cope with business
situation and changing competition. In 2003, The Siam Cement Public
Company Limited and subsidiaries accomplished sales of Baht 148,865
million, an increase of Baht 20,664 million or 16% from last year
figures of Baht 128,201 million. This stemmed from growing demand in
almost every business, making a profit of Baht 19,954 million, with Baht
17,806 million from operation; and Baht 2,148 million from sales of
investment, sales of assets for restructuring, provision for decline
value of investments and others (net of income tax).

Total assets of the Company and subsidiaries as at December 31, 2003
were Baht 249,726 million, a rise of Baht 14,082 million or 6% from Baht
235,664 million last year. The growth was a result of better investment
performance, especially in the Petrochemical Business.

Total liabilities of the Company and subsidiaries as at December 31,
2003 were Baht 134,252 million, a reduction of Baht 13,462 million from
Baht 147,714 million last year. In 2004, the Company still pursues the
policy to continuously lessen its liabilities and interest expense.

Regarding financial matters, debenture issuance, higher proportion of
domestic borrowings, and financial derivatives are in accordance with
the Board’s policy and approved guidelines as well as monitoring
systems. Foreign borrowing proportion decreased to only 1% in 2003,
greatly reducing volatile foreign exchange risk.

Moreover, the Group earned foreign-currency revenue from exports
throughout the world. At present, the Group’s export value is about 29%
of total net sales.

In addition to direct measures to efficiently and effectively reduce
cost and raise profit from operation, the Group is ready to adapt to
changing business environment. The instrument is that each business has
its own corporate culture, which fits with each different business
operation. Simultaneously, all aim to approach success, and highly
efficient customer response, both of which are important factors for
total business value addition.

The Siam Cement Group has conducted its business in line with good
corporate governance throughout the organization for years. The Group
believes that good corporate governance under good supervision by the
Management and the Board brings about transparency, disclosure, and
fairness to all stakeholders. As a result, the organization will prosper
along with the country’s strength in the long term.

The Siam Cement Group pursues the concept of Total Quality Management
(TQM) by increasing awareness for every level of its workforce to raise
competitive potential. Besides, the Group supports work safety and
environment protection, especially in the Company’s areas and
surrounding communities. Finally, the Group has always been supporting
fruitful activities and projects for society in local, regional, and
national levels.

The Group strongly believes that human resource is one of the key
factors of success. Therefore, it has been placing significance on human
resource management since the company inception for over 90 years.
Hence, “Belief in the Value of the Individual”, one of the Group’s four
business philosophy, has been respected by all affiliates for many years
until the Group has been accepted as one of the leading Thai companies
with highly efficient human resource management.