ANNUAL REPORT
BANGKOK DUSIT MEDICAL SERVICES Public Company Limited
2012
Philosophy
Bangkok Hospital is where advances in medicine meet with compassion.
Vision
Bangkok Hospital is a premier tertiary healthcare provider, dedicated to international quality, customer focused care.
Mission
We are committed to being the leader in providing internationally accepted, efďŹ cient and ethical high quality care through a dedicated healthcare team, effective leadership and up to date technology. Our hospitals shall be the medical service facilities with high standard and international quality, for trustworthiness and optimal satisfaction of the customers. Bangkok Hospital intends to continually improve the management system and its services by emphasizing on the continuous quality improvement throughout the organization.
PHYSICAL HEALTH
green health MENTAL HEALTH
MEDICAL
HEALTH CARE
FOOD & NUTRITION
ENVIRONMENT
CONTENT 05 06 08 12 14 16 24 34 38 42 44 48 52 62 74 78 83 85 86 87 88 100 149 150
Statement of the Chairman of the Board of Directors Statement of the Chairman of the Executive Committee Financial Highlights Juristic persons in which the company holds 10% of shares or greater Board of Directors Company Management Nature of Business Corporate Social Responsibility Activities Green Health Project Research and Development Healthcare Industry Outlook and Competition Risk Factors Shareholding Structure and Management Good Corporate Governance Connected Transactions Management discussion and analysis Auditor’s Remuneration Report of the Audit Committee The Board of Director’s Report on its Responsibility to the Financial Statements Report of Independent Auditor Financial Statements Notes to Consolidated Financial Statements General Information Juristic persons in which the company holds 10% of shares or greater
To strengthen our business and prepare for competition in the industry, the Company has continued to give importance to investment in clinical personnel and maintaining medical care standards in both the quality of services and medical innovation to continue improving our quality of care. Furthermore, the Company expects that the introduction of the ASEAN Economic Community (AEC) in 2015 will increase opportunities for growth in the healthcare service sector in Thailand. As Thailand is geographically situated in the center of the ASEAN Region, AEC will enable Thailand to become one of the leading medical tourism destinations. This in turn will lead to increased demand for healthcare services and economic growth, which will contribute to higher purchasing power and greater attention to personal health. With the determination to provide the best services and the unity of the physicians and nurses, the Bangkok Hospital Group is aleading healthcare provides that has been ourishing alongside Thai society for over 40 years. On behalf of the Board of Directors, I would like to thank our shareholders, debenture holders, fellow physicians and all the staff, as well as all stakeholders, for entrusting the Bangkok Hospital network and for continued supporting for the Company as always.
(Professor Emeritus Arun Pausawadi, M.D.) Chairman of the Board of Directors
Statement of the Chairman of the Board of Directors
In 2012, the business and economic situation was as expected, with the domestic economy continuing to grow despite uncertainty of the economy in various regions around the world, which had some impact on the country’s overall economy. However, the global uncertainty did not affect the private hospital business in Thailand. As the Company has made preparations in terms of personnel as well as adjusted our strategies, the Company’s operating revenue has grown, as we had targeted, by 25 percent from the previous year. It is expected that the revenue will continue to grow as a result of the increase in income per capita, increase in number of patients as people pay more attention to their health, increase in aging population and increased medical tourism.
5 Annual Report 2012
Statement of the Chairman of the Board of Directors
Statement of the Chairman of the Executive Committee Annual Report 2012
6
Statement of the Chairman of the Executive Committee Bangkok Hospital is a private hospital business that has prospered alongside Thai society for over 40 years. Presently, we manage 30 hospitals within the network, both in Thailand and overseas. We offer 5,400 beds, encompassing Bangkok, suburbs and major provinces across the country. At the end of last year, the Bangkok Hospital network continuously developed and improved healthcare services. Currently, 12 of our hospitals have received international service standards accreditation from Joint Commission International (JCI), U.S.A. In addition, Bangkok Hospital has received certification from FIFA, namely, FIFA Medical Centre of Excellence. We are the first private hospital in Thailand and ASEAN and the third in Asia (Japan, Qatar, Thailand and Saudi Arabia) to receive such honor from FIFA. Furthermore, in 2012, Bangkok Hospital network was the first private hospital in Thailand to use technology to support medical services by introducing the “ROBO DOCTOR”, which provides emergency medical care and allows remote patients to receive medical care from specialist doctors. Apart from our aim to expand and develop the standard of services of the Bangkok Hospital network to become a Thai hospital that meets international standards, we are also determined to provide care and to grow alongside Thai society. In addition to promoting social activities that we continue to organize yearly in cooperation with the Vejdusit Foundation, the Company initiated the Green Health Project with the objective to provide medical and health care knowledge to the Thai people. In addition, the project aim to help advantaged people and to promote holistic care to the society. Participants of the project included five hospital groups within the network, namely, Bangkok Hospital Group, Samitivej Hospital Group, BNH Hospital, Phyathai Hospital Group and Paolo Hospital Group, making it the first project in Thailand that brought together 26 private hospitals in bringing health care to society.
On behalf of Bangkok Dusit Medical Services Public Company Limited, I would like to express sincere gratitude to our shareholders, customers, as well as business alliances who have continuously supported the Bangkok Hospital network. I would also like to thank the Board of Directors, doctors, nurses, management and all personnel for your determination and dedication in your duties so that the Bangkok Hospital network may continue to be stable and strong with sustainable growth for many years to come.
(Mr. Prasert Prasarttong-Osoth, M.D.) Chairman of the Executive Committee
Statement of the Chairman of the Executive Committee
As the ASEAN Economic Community will be introduced in 2015, our experience and the trust that we have continued to receive gives us the confidence that we are ready to provide medical care services to the ASEAN population that will flow into Thailand. I am confident that the medical staff within the Bangkok Hospital network are equipped with the knowledge, capabilities and potential to prove the medical abilities of Thai physicians to the world and will lead this organization to become the number one medical organization in the region as they have done so in the past.
7 Annual Report 2012
In terms of operating results, looking back to 2010, which was the year the Board of Directors made the decision to merge with the Phyathai Hospital and Paolo Hospital Groups, we were concerned about the outcome of the merger, the change in organizational culture and personnel at all levels, including physicians and nurses. However, today, we are pleased to say that the decision and our determination has endeavored cooperation within the large private hospital network and strengthened the Company. Consequently, the operating results in 2012 has escalated significantly with medical care revenue increasing from Baht 23,513 million in 2010 to Baht 35,224 million in 2011 and Baht 44,307 million in 2012. The Company’s assets increased from Baht 32,197 million in 2010 to Baht 58,792 million in 2011 and Baht 68,461 million in 2012. Market capitalization also increased from Baht 57,940 million in 2010 to Baht 126,728 million in 2011 and Baht 175,409 million at the end of 2012.
Financial Highlights Revenue from Hospital Operations and Growth on Revenue from Hospital Operations
Net profit and Net Profit Margin
25.8%
17.3%
49.8% Financial Highlights
9.6% 23,513
35,224
44,307
2,295
4,386
7,937
2010
2011
2012
2010
2011
2012
Including non-recurring items Revenue from Hospital Operations Growth on Revenue from Hospital Operations
8 Annual Report 2012
11.9%
8.9%
Net profit (Million Baht) Net Profit Margin
5 Years Share Prices (2008-2012) Compared to SET Index SET Index 1,600 1,400 1,200 1,000 800 600 400 200 0 Jan-08
BGH Share Price (Baht) 120 100 80 60 40 20 0 Jul-08
Jan-09
Jul-09
Jan-10
Jul-10
Jan-11
SET Index Bangkok Dusit Medical Service Public Co., Ltd. Share Price
Jul-11
Jan-12
Jul-12
2011
2010
Balance Sheets (in million Baht) Total Assets Total Liabilities Total Shareholders’ Equity
68,461 29,634 38,827
58,792 25,375 33,417
32,197 15,914 16,283
Income Statements (in million Baht) Revenue from Hospital Operations Operating Income1/ Net profit
44,307 45,994 7,937
35,224 36,726 4,386
23,513 23,968 2,295
Information about Common Shares Share Capital Issue and Fully Paid-up (Million Share) Book Value Per Share (Baht) Basic Earnings Per Share (Baht) Dividend Per Share (Baht)
1,545.5 25.1 5.1 1.82/
1,545.5 21.6 3.0 1.1
1,246.0 13.1 1.9 0.8
9 25.8 81.0
49.8 91.1
8.9 33.0
23.3 13.4 17.3
23.2 10.6 11.9
23.0 9.5 9.6
12.5 22.9
9.6 18.4
7.3 15.4
0.8 30.8 12.3 47.4
1.2 26.5 12.2 39.8
0.8 26.5 8.7 31.5
0.5 0.4 1.5 12.6
0.5 0.4 1.5 11.1
0.7 0.5 1.5 9.5
1/ Excluding non- recurring items which are consisted of gain on fair value adjustment of investments in 2012 and 2011 and gain on a bargain purchase as a result of an acquisition of A.N.B. Laboratories Company Limited in 2010 2/ Board-approved rate as of 12nd March 2013
Annual Report 2012
Financial Ratios Growth Ratios (%) Growth on Revenue from Hospital Operations Net Profit Growth Profitability Ratios (%) EBITDA Margin (Excluding non-recurring items)1/ Net Profit Margin (Excluding non-recurring items)1/ Net Profit Margin Returns (%) Return on Average Assets Return on Average Equity Assets & Liabilities Management Liquidity Ratio (x) Average Collection (Days) Average Inventory Period (days) Average Payable Period (days) Leverage and Coverage ratios) (x) Total Interest-Bearing Debt to Equity Net Interest-Bearing Debt to Equity Net Interest-Bearing Debt to EBITDA Interest Coverage
Financial Highlights
2012
Annual Report 2012 10
Your Trusted Healthcare Network
Your Trusted Healthcare Network
Annual Report 2012
11
Your Trusted Healthcare Network
Juristic persons in which the company holds 10% of shares or greater Annual Report 2012
12
Juristic persons in which the company holds 10% of shares or greater as at December 31, 2012 More than 90%
BPK
99.7
BNH
91.5
BHI
100.0
BHH
98.8
SVH
95.8
BPB
100.0
BSH
100.0
BKY
100.0
68.1
AIH
100.0
Royal Abu Dhabi
BTH
99.8
BDMS International 100.0
Irving 96.0
Royal BKK
100.0
ANB
BCH
99.7
PPMS 100.0
First Health
NPMS 100.0
BPH
97.3
BIO
95.0
BRH
100.0
GLS
100.0
BCM 100.0
BUD
100.0
BKH
90.4
SSH
99.0
Sodexho
74.0
Company Name
Initial
AIH ANB BCH BCM B-Cop BDMS Inter
Asia International Healthcare Co., Ltd. A.N.B. Laboratory Co., Ltd. Wattanavej Co., Ltd. Bangkok Hospital Chaingmai Co., Ltd. Bangkok Helicopter Services Co., Ltd. BDMS International Medical Services Co., Ltd. BDMS Training Co., Ltd. Bumrungrad Hospital PLC. Bangkok Hospital Had yai Co., Ltd. Bangkok Health Insurance Co., Ltd. Bio-Molecular Laboratories (Thailand) Co., Ltd. Bangkok Hospital Ratchasima Co., Ltd. Bangkok Hospital Khao Yai Co., Ltd.
BNH BPB BPD BPH BPK BRH BSH BTH BUD Cool & Joy First Health GLS Irving KDH MP
BKH BKY
100.0
BDMS 100.0 Training
Initial
BDMS Training BH BHH BHI BIO
30.0
Company Name BNH Medical Center Co., Ltd. Bankok Premier Life Insurance Co., Ltd. Bangkok Hosital Prapradaeng Co., Ltd. Bangkok Hospital Pattaya Co., Ltd. Bangkok Hospital Pattaya Co., Ltd. Bangkok Hospital Rayong Co., Ltd. Bangkok Hospital Samui Co., Ltd. Bangkok Hospital Trad Co., Ltd. Bangkok Hospital Udon Co., Ltd. Cool & Joy Co., Ltd. First Health Food Co., Ltd. Greenline Synergy Co., Ltd. Irving Sheridan SE Co., Ltd. Krungthon Hospital Co., Lt.d Medicpharma Co., Ltd.
Less than 20%
BPD
79.0
S.R. Property
49.0
PMED 100.0
PYT1 100.0
NHS
74.0
Seam Reap
49.0
PSAMUT 93.3
PYT2 99.1
Angkor Pisith
80.0
PPFP
49.0
PCHOK
85.7
PYT3 98.2
Royal Rattanak
70.0
MP
49.0
PNW
99.8
PYTS 66.5
Initial NHS NPMS PCHOK PMED PNW PPCL PPFP PPMS PSAMUT PYT 1 PYT 2 PYT 3 PYTS
Company Name National Healthcare Systems Co., Ltd. New Petchburi Medical Services Co., Ltd. Siam Medical Co., Ltd. Paolo Medic Co.,Ltd. Thai Medical Center PLC. Prasit Patana Plc. Phnom Penh First Property Co., Ltd. Phnom Penh Medical Services Public Co.,Ltd Paolo Samut Prakran Co., Ltd. Phaya Thai 1 Hospital Co., Ltd. The PhayaThai 2 Hospital Co., Ltd. The PhayaThai 3 Hospital Co., Ltd. Sriracha Nakorn General Hospital PLC.
Udon Pattana
15.3
B-COP 49.0 RAM
38.2
KDH
20.0
COOL & JOY
30.0
BH
23.9
Initial RAH RAM Royal Abu Dhabi Royal BKK RRH S.R. Property Seam Reap Sodexho SSH SVH Udon Pattana
Company Name Angkor Pisith Co., Ltd. Ramkhamhaeng Hospital Plc. Al Ghaith Bangkok Dusit Management Service LLC. Royal Bangkok Healthcare Co., Ltd. Royal Rattanak Medical Services Co., Ltd. S.R. Property Co., Ltd. Seam Reap Invesment Co., Ltd. Sodexo Healthcare Support Service (Thailand) Co., Ltd. Samitivej Sriracha Co., Ltd. Samitivej Plc. (SVH) Udorn Pattana Co., Ltd.
Juristic persons in which the company holds 10% of shares or greater
98.3
20-49%
13 Annual Report 2012
PPCL
50-89%
Board of Directors
Board of Directors 1
2
3
5
6
7
9
10
11
13
14
15
Annual Report 2012
14
2. Mr.Chuladej Yossundharakul, M.D. Director
10. Mr.Thavatvong Thanasumitra Director
3. Mr.Wichai Thongtang 2nd Vice Chairman
11. Mr.Chawalit Setthmethikul Independent Director
4. Mr.Prasert Prasarttong-Osoth, M.D. CEO & President
12
9. Professor Emeritus Santasiri Sornmani, M.D. Chairman of Audit Committee / Independent Director
12. Mr.Somchai Sujjapongse, Phd.  Independent Director/ Member of Audit 5. Mr.Pongsak Viddayakorn, M.D. Committee Director 13. Mr. Sripop Sarasas 6. Mr.Chatree Duangnet, M.D. Independent Director/ Director ,Chief Operating Member of Audit Officer – Medical Affairs , Committee CEO of Bangkok Hospital Medical Center 14. Miss Kananuch Lekwijit Independent Director/ 7. Mr.Pradit Theekakul Member of Audit Director / Executive advisor Committee to CEO 15. Mr.Thongchai Jira-alongkorn 8. Mr.Chirotchana Suchato, M.D. Director Director
Board of Directors
8
1. Professor Emeritus Arun Pausawasdi, M.D. Chairman of the Board of Directors
15 Annual Report 2012
4
Company Management
Company Management
Professor Emeritus Arun Pausawasdi, M.D.
Annual Report 2012
16
Chairman of the Board of Directors 75 years Education
• Directors Accreditation Program Class 45, Thai Institute of Directors Association • Dr. Med, Hamburg University, German • Facharzt fur Chirurgie, The Medical Council of Hamburg, German • Certificate of Medical Clinic, Mahidol University • Medical Doctor, Faculty of Medicine Siriraj Hospital, Mahidol University
Experience
• Assistant to Ministry of Public Health • President, Royal College of Surgeons of Thailand • Secretary General, Royal College of Surgeons of Thailand • Chairman of Scientific Session Medical, The Medical Association of Thailand • Dean, Faculty of Medicine Siriraj Hospital, Mahidol University • Director of the Medical Association
Other Position
• Chairman, Centre for Continuing Medical Education of Thailand • Vice President, The Prince Mahidol Award Foundation • Member of the Thai medical registration license committee • Vice President, Siriraj Foundation • Director of Chao Phya Hospital PLC • Director of Chao Phya Medical Center Co., Ltd.
Bangkok Dusit Medical Services PLC.
Mr. Prasert Prasarttong-Osoth, M.D. CEO & President 79 years Education
• Directors Accreditation Program Class 45, Thai Institute of Directors Association • Certificate from National Defense College, Course for the Joint State Private Sector, Class 1 • Bachelor Degree from Siriraj Medical School, University of Medicine
Experience
• Member of National Legislative Council (Senator) • Member of National Legislative Council • Surgeon in Department of Surgery, Faculty of Medicine Siriraj Hospital
Other Position
• Director/ CEO, Bangkok Airways Co., Ltd. • Chairman, Bangkok Airways Holding Co., Ltd. • Chairman, A.N.B. Laboratories Co., Ltd.
Year of appointed to be a director • 1994
Board of Director meeting attendance • 16/16
Number of company shares* • 294,517,734 share (19.06%)*
Relationship among other management • None
Year of appointed to be a director • 1998
Board of Director meeting attendance • 15/16
Number of shareholding* • 381,781 shares (0.03%)
Relationship among other management • None
Noted * : Outstanding shares held as of 18th December 2012 includes spouses and dependents (if any). : Company Management Profile as of 31st December 2012.
Mr. Chuladej Yossundharakul, M.D.
Mr.Wichai Thongtang
Education
Education
Experience
• Head, Surgical Unit, National Cancer Institute • Hospital Director, Karuna Pitak Hospital • Hospital Director, Bangkok Hospital
Other Position
• Directors Accreditation Program (DAP) # 15 • Audit Committee Program (ACP) # 3 • Directors Certification Program (DCP) # 62 • Financial for Non-Finance Director (FND) # 21 • Role of the Chairman Program (RCP) # 11 • Capital Market Academy # 9 • Master’s Degree of Public Administration, Thammasat University, Bangkok, Thailand • Bachelor’s Degree of Law, Thammasat University, Bangkok, Thailand
Experience
• 1994
• President and CEO of Sikarin Hospital Plc. • Vice Chairman of KPN, Yamaha Group • Chairman of Audit Committee, KPN Automotive Plc. • Chairman of the Board, Health Network Plc. • Chairman of the Board, Yannaphan Plc. • Executive Vice President of IVGlobal Securities
Board of Director meeting attendance
Other Position
• Chairman, Bangkok Hospital Prapadaeng Co., Ltd. • Director, Bangkok Hospital Pattaya, Co., Ltd. • Director, Royal Bangkok Healthcare Co., Ltd.
Year of appointed to be a director • 16/16
Number of company shares* • 27,565,795 Shares (1.78%)
Relationship among other management • None
• Chairman of the Board, Prasit Patana Pcl. • Chairman of the Board, Phyathai 1 Hospital Co., Ltd. • Chairman of the Board, Phyathai 2 Hospital Co., Ltd. • Chairman of the Board, Phyathai 3 Hospital Co., Ltd • Chairman of the Board, Sriracha Nakorn Hospital Pcl. • Chairman of the Board, Paolo Medic Co., Ltd • Chairman of the Board, Paolo Samutprakarn Co., Ltd • Chairman of the Board, Paolo Chokchai 4 Co., Ltd • Chairman of the Board, Paolo Nawamin Co., Ltd • Head of the Wichai Thongtang Law Firm • Vice Chairman of Bangkok Dusit Medical Services Pcl. • Chairman of the Board of Directors and Executive Director of Grand Asset Hotels and Property Pcl. • Executive Vice President of Metromachinery Co., Ltd. • Chairman of Cable Thai Holding Pcl.,
Year of appointed to be a director • 2011
Board of Director meeting attendance • 15/16
Number of company shares* • 184,998,269 shares (11.97%)
Relationship among other management • None
Noted * : Outstanding shares held as of 18th December 2012 includes spouses and dependents (if any). : Company Management Profile as of 31st December 2012.
Company Management
• Directors Accreditation Program Class 45, Thai Institute of Directors Association • Diplomate of American Board of Surgery • Medical Doctor, Faculty of Medicine Siriraj Hospital, Mahidol University
2nd Vice Chairman 66 years
17 Annual Report 2012
Director 80 years
Mr. Pongsak Viddayakorn, M.D.
Mr. Chatree Duangnet, M.D.
Education
Education • Directors Accreditation Program Class 54, Thai Institute of Directors Association • Certified of National Defense College • Fellow, American College of Medical Quality • Certified, American Board of Quality Assurance & Utilization Review Physicians • Fellow, American Academy of Pediatrics • Certified, American Board of Pediatrics • Medical Doctor, Faculty of Medicine, Chulalongkorn University Experience • Group Chief Medical Officer, Bumrungrad Hospital, Bangkok • Chief Executive Administrator, Bangkok Hospital, • Clinical Assistant Professor of Pediatrics, College of Medicine, Pennsylvania State University, Pennsylvania, USA • Chairman of the Board, Jameson Physician Hospital Organization, New Castle, Pennsylvania, USA • President, Lawrence Independent Physician Association, Lawrence County, Pennsylvania, USA • Physician Executive, Jameson Health System, New Castle, Pennsylvania, USA • Training courses in QA/UR/RM. American Board of Quality Assurance & Utilization Review Physicians, USA Other Position • Chairman, Bangkok Hospital Samui Co., Ltd. • Chairman, Greenline Synergy Co., Ltd. • Chairman, Bangkok Hospital Udon Co., Ltd. • Director, Prasit Patana Plc. • Director, Phyathai 1 Hospital Co., Ltd. • Director, Phyathai 2 Hospital Co., Ltd. • Director, Phyathai 3 Hospital Co., Ltd • Director, Sriracha Nakorn Hospital Plc. • Director, Paolo Medic Co., Ltd • Director, Paolo Samutprakarn Co., Ltd • Director, Paolo Chokchai 4 Co., Ltd • Director, Paolo Nawamin Co., Ltd • Director, National Healthcare Systems Co., Ltd. • Director, Bio Molecular Laboratory (Thailand) Co., Ltd. • Director, Bangkok Helicopter Services Co., Ltd. • Director, B.D.M.S International Medical Services Co., Ltd. • Director, Angkor Pisith Co., Ltd. • Director, Phnom Penh Medical Services Co., Ltd. • Director, Rattanak Medical Services Co., Ltd. • Director, Bangkok Health Insurance Co., Ltd. • Director, Asia International Healthcare Co., Ltd. • Director, Sodexho Healthcare Support Services (Th) Co., Ltd. • Director, Royal Bangkok Healthcare Co., Ltd. • Director, Supeior Bio Tech Co., Ltd. Year of appointed • 2006 Board of Director meeting attendance • 16/16 Number of company shares* • 180,000 Shares / (0.01%) Relationship among other management • None
Company Management
Director 79 years
Annual Report 2012
18
• Honorary Doctorate in Humanities, Universities of Baguio • Directors Accreditation Program Class 45, Thai Institute of
Directors Association
• Honorary Doctorate in Business Management, Christian University • Certificate from National Defences College • DTM&H Diploma , Faculty of Tropical Medicine and Hygiene,
Mahidol University
• Post Graduate Study, University of Pennsylvania, USA. • Medical Doctor, Faculty of Medicine Siriraj Hospital,
Mahidol University
Experience
• President / Bangkok Dusit Medical Services PCL. • Director of The Medical Heath Care Centre of The Teacher
Council of Thailand
• Member of consultation committee of the Bangkok
Metropolitan Administration Governor (Healthcare)
• Chairman, Private Hospital Association • Director of Medical Association
Other position • • • • • • • • • • • • • • • • • •
Vice Chairman, Samitivej PLC. Chairman, Bangkok Phuket Hospital Co., Ltd. Chairman, Bangkok Ratchasima Hospital Co., Ltd. Director, Prasit Patana PLC. Director, Phyathai 1 Hospital Co., Ltd. Director, Phyathai 2 Hospital Co., Ltd. Director, Phyathai 3 Hospital Co., Ltd. Director, Srirachanakorn General Hospital PLC. Director, Paolo Medic Co., Ltd. Director, Paolo Samut Prakarn Co., Ltd. Director, Siam Medic Co., Ltd. Director, Thai Medical Centre PLC. Chairman, Bangkok Hospital Khao- Yai Co., Ltd. Vice Chairman, Angkor Pisith Co., Ltd. Chairman, B.D.M.S International Medical Services Co., Ltd. Chairman, Bangkok Premier Brokerage Insurance Co., Ltd. Chairman, Asia International Healthcare Co., Ltd. Chairman, Royal Bangkok Healthcare Co., Ltd.
Year of appointed to be a director • 1994
Board of Director meeting attendance • 15/16
Number of company shares* • 100,000 Shares (0.01%)
Relationship among other management • None
Director ,Chief Operating Officer – Medical Affairs, CEO of Bangkok Hospital Medical Center 68 years
Noted * : Outstanding shares held as of 18th December 2012 includes spouses and dependents (if any). : Company Management Profile as of 31st December 2012.
Mr. Pradit Theekakul
Mr. Chirotchana Suchato, M.D.
Education
Education
Other position
• Director, Samitivej PCL. • Director, Bangkok Hospital Udon Co., Ltd • Director, Prasit Patana Plc. • Director, Phyathai 1 Hospital Co., Ltd. • Director, Phyathai 2 Hospital Co., Ltd. • Director, Phyathai 3 Hospital Co., Ltd • Director, Sriracha Nakorn Hospital Plc. • Director, Paolo Medic Co., Ltd • Director, Paolo Samutprakarn Co., Ltd • Director, Paolo Chokchai 4 Co., Ltd • Director, Paolo Nawamin Co., Ltd • Director, Bangkok Helicopter Services Co., Ltd. • Director, A.N.B. Laboratories Co., Ltd. • Director, BDMS Training Co., Ltd. • Director, Sodexo Healthcare Support Services (Thailand) Co., Ltd. • Director, Sodexo Support Services (Thailand) Co., Ltd. • Senior Executive Vice President- Administration Bangkok Airways Co., Ltd. • Director, Bangkok Airways Holding Co., Ltd. • Director, Catering – Bangkok Airways Co., Ltd. • Director, Thai Petroleum Service Co., Ltd. • Chairman, Bangkok Air Catering, WFS-PG Cargo Co., Ltd. • Director, Worldwide Flight Services Bangkok Air Ground Handling Co., Ltd.
• Directors Accreditation Program Class 45, Thai Institute of Directors Association • Diplomate of American Board of Radiology, Downstate University of New York • Graduated Course Radiobiology at M.D. Anderson Hospital, Houston, Texas • Medical Doctor, Faculty of Medicine Siriraj Hospital, Mahidol University
Experience
• School Director, School of X-Tray Technician • Professor of Radiology division ,Faculty of Medicine, Ramathibodi Hospital • Consultant to Radiology, Clinic of The Teacher Council of Thailand
Other position
• Chairman, Bangkok Hospital Pattaya Co., Ltd • Director, Bangkok Hospital Phuket Co., Ltd. • Director, Bangkok Hospital Khao- Yai Co., Ltd. • Director, Bangkok Health Insurance Co., Ltd. • Director, Bangkok Premier Brokerage Insurance Co., Ltd. • Director, Asia International Healthcare Co., Ltd.
Year of appointed to be a director • 1994
Board of Director meeting attendance • 16/16
Number of company shares* • 39,408,009 Shares (2.55%)
Relationship among other management • None
Year of appointed to be a director • 2008
Board of Director meeting attendance • 16/16
Number of company shares* • 563,000 Shares/ (0.04%)
Relationship among other management • None
Noted * : Outstanding shares held as of 18th December 2012 includes spouses and dependents (if any). : Company Management Profile as of 31st December 2012.
Company Management
• Directors Certification Program Class 29th, Thai Institute of Directors Association • Bachelor Degree of Law Chulalongkorn University / Bangkok • The Thai Barrister • Bachelor Degree or Arts (Political Science) Ramkamhaeng University / Bangkok, Thailand
Director 77 years
19 Annual Report 2012
Director / Executive advisor to CEO 54 years
Company Management
Professor Emeritus Santasiri Sornmani, M.D.
Annual Report 2012
20
Chairman of Audit Committee / Independent Director 78 Years Education
• Directors Accreditation Program Class 43, Thai Institute of Directors Association • Ph.D. (Tropical Medicine), Liverpool University • Medical Doctor, Faculty of Medicine Siriraj Hospital, Mahidol University
Experience
• Vice President for Administration, Mahidol University • Dean, Faculty of Tropical Medicine, Mahidol University • Member, Expert Committee on Food Borne Parasitic Diseases, WHO
Position
• Chairman, The Medic Pharma Co., Ltd. • Vice Chairman, Chureevej Co., Ltd. (Chureevej Hospital)
Mr. Thavatvong Thanasumitra Director 65 years
Education
• Directors Certification Program Class 27th, Thai Institute of Directors Association • Bachelor of Law, Thammasart University
Experience
• Managing Director, Air Lanka Catering Service Co., Ltd.
Other position
• Director, Senior Executive Vice President of Finance, Bangkok Airways Co., Ltd. • Vice President, Catering – Bangkok Airways Co., Ltd. • Director, Bangkok Helicopter Services Co., Ltd. • Managing Director, Thai Petroleum Service Co., Ltd. • Chairman, Bangkok Air Catering, WFS-PG Cargo Co., Ltd. • Director, Worldwide Flight Services Bangkok Air Ground Handling Co., Ltd.
Year of appointed
Year of appointed to be a director
• 1999
Board of Director meeting attendance
• 14/16
Number of company shares*
• 4,860,016 Shares (0.31%)
Relationship among other management
• None
• 1994
• 16/16
• 1,715,127 Shares (0.11%)
Board of Director meeting attendance Number of company shares* Relationship among other management
• None
Noted * : Outstanding shares held as of 18th December 2012 includes spouses and dependents (if any). : Company Management Profile as of 31st December 2012.
Education
• Bachelor of Laws (LL.B.) (Second Class Honors), Thammasat University • Barrister at Law, Institute of Legal Education, Thai Bar Association • Diploma from National Defence College of Thailand, Class 40 • Master of Political Science (M.Pol.Sc), Public Administration, Thammasat University • Directors Accreditation Program Class 6/2003, Thai Institute of Directors Association • Director Certification Program (DCP) Class 74, Thai Institute of Directors Association
Experience
• Director General of The Thai Customs Department, Ministry of Finance • Deputy Permanent Secretaries of Ministry of Finance • Inspector of Ministry of Finance • Deputy Director-General : The Excise Department of Ministry of Finance • Chairman: The Board of Small Business Credit Guarantee Corporation • Vice Chairman : The Board of Metropolitan Electricity Authority • Vice President : The Board of Airports of Thailand PCL. • Director : Office of The council of State • Director : The Thai BAR
Other position
• Chairman of The Board of Directors : Hemaraj Land and Development PCL. • President : Sriracha Harbour PCL.
Year of appointed • 2011
Board of Director meeting attendance • 15/16
Number of company shares* • None
Independent Director/ Member of Audit Committee 51 years Education
• Ph.D. (Economics) 1990 The Ohio State University / Columbus, Ohio, U.S.A. • M.A. (Economics) 1985 The Ohio State University/ Columbus, Ohio, U.S.A. • B.A. (Economics) (Hons.) 1984 /Chulalongkorn University / Bangkok, Thailand • Directors Certification Program Class75th, Thai Institute of Directors Association
Experience
• Director-General State Enterprise Policy Office (SEPO) • Director-General The Customs Department, Ministry of Finance • Director-General Fiscal Policy Office, Ministry of Finance • Fiscal Policy Advisor Fiscal Policy Office Ministry of Finance • Deputy Director-General Fiscal Policy Office / Ministry of Finance • Director, Bureau of Fiscal Policy Fiscal Policy Office / Ministry of Finance • Director, Fiscal Risk Management Group Fiscal Policy Office / Ministry of Finance • Director, Fiscal Policy and Planning Division Fiscal Policy Office / Ministry of Finance • Director, Savings and Investment Policy Division Fiscal Policy Office/ Ministry of Finance • Director, Economic Rehabilitation Planning and Policy Division
Other position
• Director, Board of Metropolitan Electricity Authority • Director, Board of Aeronautical Radio of Thailand • Director, Board of Thai Oil Public Company Limited
Year of appointed to be a director • 2011
Board of Director meeting attendance • 9/16
Number of company shares* • None
Relationship among other management • None
Relationship among other management • None
Noted * : Outstanding shares held as of 18th December 2012 includes spouses and dependents (if any). : Company Management Profile as of 31st December 2012.
Company Management
Independent Director 65 years
Mr. Somchai Sujjapongse, Phd.
21 Annual Report 2012
Mr. Chawalit Setthmethikul
Company Management
Mr. Sripop Sarasas
Annual Report 2012
22
Independent Director/ Member of Audit Committee 56 years Education
• Certificate, Audit Committee Program – ACP 1/2004 Thai Institute of Directors • Certificate, Director Certification Program 22/2002 Thai Institute of Directors • Diploma Thai Institute of Directors • Master Degree in Business Administration (Finance) University of Southern California, U.S.A.
Experience
• President & CEO Krung Thai Asset Management PCL • Managing Director/ Phatra Securities PCL. • Chief Executive Officer General Environmental Conservation PCL
Other position
• Director / Member of Audit Committee The Royal Ceramic Industry PCL. • Director / Member of Audit Committee Advanced Information Technology PCL. • Director / Member of Audit Committee Kiattana Transport PCL.
Miss Kananuch Lekwijit Independent Director 56 years Education
• Master of Art (M.A.) from Kasetsart University • Directors Certification Program Class 27th, Thai Institute of Directors Association
Experience
• Director of Kornthip Company Limited • Director of Metro Granite Company Limited • Director of Health Network Public Company Limited
Other position
• Director of Paolo Medic Company Limited • Director of Saithong Business Company Limited
Year of appointed to be a director • 2011
Board of Director meeting attendance • 16/16
Number of company shares* • 3,993,092 shares (0.26%)
Relationship among other management • None
Year of appointed to be a director • 2008
Board of Director meeting attendance • 16/16
Number of company shares* • None
Relationship among other management • None
Mr.Thongchai Jira-alongkorn Director 53 years
Education
• Bangkok University, School of Business Administration major Marketing
Other position
• Deputy Managing director, Viriyah Insurance Co., Ltd • Managing director, Viriyah International Broker Co., Ltd. • General Manager, Viriyah Leasing Co., Ltd • Director/ Managing Director, ThonburiPahich Leasing Co., Ltd.
Noted * : Outstanding shares held as of 18th December 2012 includes spouses and dependents (if any). : Company Management Profile as of 31st December 2012.
• 2012
Board of Director meeting attendance • 10/10 **
Number of company shares* • 1,137,336 Shares (0.07%)
Relationship among other management • None
• Senior Vice President, Investment Banking Department TMB Bank Public Company Limited • Senior Vice President, Finance Department Industrial Finance Corporation of Thailand
Other Position
• Director, Thai Listed Companies Association • Director, Bangkok Hospital Pattaya Co., Ltd. • Director, Bangkok Hospital Phuket Co., Ltd. • Director, Bangkok Hospital Udon Co., Ltd. • Director, Bangkok Hospital Chiangmai Co., Ltd. • Director, Prasit Patana PCL. • Director, Phyathai 1 Hospital • Director, Phyathai 2 Hospital • Director, Phyathai 3 Hospital • Director, Phyathai Sriracha Hospital • Director, Paolo Memorial Hospital Phaholyothin • Director, Paolo Memorial Hospital Samutprakarn • Director, Paolo Memorial Hospital Chokchai 4 • Director, Paolo Memorial Hospital Nawamin • Director, Angkor Pisith Co., Ltd. • Director, National Healthcare System Co., Ltd. • Director, Greenline Synergy Co., Ltd. • Director, Bangkok Helicopter Services Co., Ltd. • Director, Bangkok Health Insurance Co., Ltd. • Director, BDMS Training Co., Ltd.
Number of company shares* • None
Relationship among other management • None
Mrs. Narumol Noi-am Chief Financial Officer 55 years Education
• MBA Banking and Finance, from North Texas State University, USA • Bachelor of Economics (second class honors) Faculty of Economics from Chulalongkorn University, Thailand • Leader Program Capital Market Academy Class 15 by Capital Market Academy (CMA) The Stock Exchange of Thailand • TLCA Leadership Development Program “Enhancing Competitiveness” by Thai Listed Companies Association & IMD • Advanced Certificate Course in Politics and Governance in Democratic Systems for Executives, class 13 by King Prajadhipok’s Institute • Successful Formulation & Execution of Strategy • Class 6/2010 by Thai Institute of Directors Association • Directors Certification Program Class 107 by Thai Institute of Directors Association • Financial Executive Development Program Class 12 by The Thai Institute of Banking and Finance for Executives from Financial Institutions • Applied International Management Program, Sweden by Government of Sweden
Mr Trin Charumilind Chief of Doctor 62 years Education
• Diplomat American Board of Allergy and Immunology / The United States • Diplomat American Board of Pediatrics / The United States • Faculty of Medicine Siriraj Hospital / Mahidol University, Thailand
Experience
• Chief Medical Officer, Bangkok Hospital Medical Center • Director of Bangkok Allergy and Asthma Center
Number of company shares* • None
Relationship among other management • None
Noted * : Outstanding shares held as of 18th December 2012 includes spouses and dependents (if any).
** : Directors had been appointed by the AGM 2012 held on 20th April 2012, which directors were on duty and attend the Board of Directors meeting since Board of director meeting no 4/2012.
Company Management
Year of appointed to be a director
Experience
23 Annual Report 2012
• Director/ General Manager T.B.B. Leasing Co., Ltd. • Director/ Managing Director, Thonburi Automotive Commercial Co., Ltd. • Director/ Vice President, VIG Car Rent Co., Ltd. • Managing Director, S.V.T. Property 2003 Co., Ltd. • Managing Director, Viriyah Nakarin Co., Ltd. • Managing Director, Viriyah Autosales Co., Ltd. • Managing Director, V.S.T.Autosales (2002) Co., Ltd. • Managing Director, V.S.R Autosales Co., Ltd. • Managing Director, VIG Automobile (2003) Co., Ltd. • Managing Director, VSK Automobile Co., Ltd. • Managing Director, Viriyah Mazda (2004) Co., Ltd. • Managing Director, V.M.S. Car Sales Co., Ltd. • Managing Director, V.Group Mitsuautosales Co., Ltd.
Nature of Business History
Bangkok Dusit Medical Services Public Company Limited was registered on 30th October 1969 under the name “Bangkok Dusit Medical Services Company Limited” with an initial registered capital of Baht 10 million. On 26th February 1972, Bangkok Hospital commenced operations in providing medical services. The Company was later listed on the Stock Exchange of Thailand on 2nd October 1991 and registered its conversion to public company limited in 1994. Presently, the Company has a registered capital of Baht 1,700.00 million, with paid-up capital of Baht 1,545.46 million.
Nature of Business
Major Developments in the Past Five Years
Annual Report 2012
24
2008 - The Company established a 100% owned subsidiary, Greenline Synergy Company Limited, to act as the center for information technology. The aim of this new company is to standardize information technology within the Group for the best interests of the end users and to lower costs associated with information technology developments. - The Company bought the 256-slice multi-detector CT scan, the newest innovation in high-speed, computerized x-ray to detect and diagnose acute coronary syndrome at Bangkok Heart Hospital. 2009 - The Company established the Bangkok Hospital Khao Yai Company Limited, with Baht 70 million capital and holding 100% of the total shares outstanding, to operate a private hospital that caters to the people and tourists in Khao Yai, Nakornratchasima Province. - The Company bought 114,391,922 shares of rights issues of Prasit Pattana Public Company Limited at Baht 1 per share, increasing the Company’s ownership from 16.31% to 16.95%. The Company also bought additional shares from the existing shareholders, which increased the Company’s ownership to 19.47%. - The Company installed the Tele Interpreter system to improve communications between physicians and patients from overseas. The system employs the videophone to provide interpreters in 26 languages. There are applications that provide interpretation of 3 major languages, namely, Japanese, Arabic and English. Interpreters are available 24 hours a day using Unified Communication technology. The system is installed on the physicians’ and interpreters’ computers for communication and exchanging of information. In the case that the interpreter is outside the hospital, the interpreter can use the Wireless IP Phone to communicate at any time.
2010 - The Company invested in Krungthon Hospital Public Company Limited “KDH”, a company listed on the Stock Exchange of Thailand and operating a 150-bed private hospital, by acquiring shares from existing shareholders of KDH with initial investment equal to 16.82% of registered and paid-up capital of KDH. Later, the Company acquired additional shares through the Stock Exchange of Thailand, resulting in total number of shares held equal to 20.01% of registered and paid-up capital of KDH. - The Company increased capital in Greenline Synergy Company Limited, a subsidiary in which the Company holds 100%, from Baht 30 million to Baht 200 million in order to improve information technology services provided to the Group. - Wattanosoth Hospital, the cancer hospital, opened the Bangkok Hematology Center on 20th August 2010 to provide medical care to patients with blood disease by a team of hematology physicians and diagnosis laboratory which meets high standards, as well as a blood bank to store and reserve blood.
Nature of Business
The Bangkok Hematology Center provides efficient holistic medical care to patients with blood disease. - The Company went through some restructuring. On 28th October 2010, the Company executed an Entire Business Transfer of Bangkok Hospital Hua Hin Company Limited, a subsidiary in which the Company holds 100% and was established as a 60-bed private hospital in Hua Hin, Prachuabkirikhan Province. The purpose of the Entire Business Transfer was to transfer operations of the Bangkok Hospital Hua Hin from the subsidiary to Bangkok Dusit Medical Services Public Company Limited, as a branch of Bangkok Hospital in Hua Hin, in order to reduce management costs and increase flexibility in management of operations and resources, especially in management of medical personnel, which will increase operational efficiency to meet the Company’s policy. After the transfer of the business and all assets to the parent company, the Bangkok Hospital Hua Hin Company Limited registered the closing of the business on 5th November 2010 and has currently completed the liquidation. - The Company increased capital in Royal Bangkok Healthcare Company Limited, a subsidiary in which the Company holds 100%, from initial registered capital of Baht 1.0 million to Baht 736.0 million. The increased capital was used to acquire all shares of A.N.B. Laboratories Company Limited (“ANB”) from existing shareholders on 1st December 2010 with total investment of Baht 734.0 million. ANB is the 4th largest producer of saline in the country. In addition, the company also produces and distributes medicine and medical supplies with exports equaling about 20% of total sales. - The Company invested in an Open MRI 1.0 T, the only such machine in Thailand. Patients do not need to enter the tunnel when getting a scan as before, which greatly reduces patient’s anxiety of confined spaces and does not require anesthesia.
25 Annual Report 2012
- The Spine Academy, Bangkok Hospital acquired surgical instruments to assist in providing the best spine and brain surgery. • Intraoperative CT scanner, or O-arm, photographs the spine and the surrounding areas using Computerized Tomography through X-Ray. The resulting photograph is precise and pinpoints the spine during surgery, enabling surgeons to operate on small areas or in pinning the spine with the highest accuracy. • Surgical Navigator (“Stealth 7”) an innovative instrument used in spine and brain surgery, which assists the surgeon in accurately determining the exact location of brain tumors or various points in the spine to within a fraction of a millimeter.
Nature of Business
- The Bangkok Spine Academy has performed minimal invasive spine surgery using a microscope to reduce pain and blood loss and for faster recuperation. - The Bangkok Heart Hospital and the Pacific Rim Electrophysiology Research Institute established the “Pacific Rim Electrophysiology Research Institute at Bangkok Hospital” and the “Cardiac Electrophysiology Clinic” headed by Dr. Koonlawee Nademanee, an American Board cardiologist specializing in cardiac electrophysiology. The Institute provides diagnosis and treatment of a variety of irregular heart rhythms (cardiac arrhythmias) using catheter ablation, electrophysiology and cardiac device implantation. - The Company invested in the Bi-plane DSA used in diagnosis and treatment of strokes and other blood vessels with visual effects using 2 megapixel digital imaging. The technology enables doctors to more efficiently diagnose by creating 3 dimension imaging, which can clearly show blood vessels that are as thin as a strand of hair.
Annual Report 2012
26
2011 - In 2011, the Company invested in 103,827,600 common shares of Bumrungrad Hospital Public Company Limited (“BH”), equal to 14.22% of outstanding shares sold of BH. - The Extraordinary Shareholders’ Meeting 1/2011 on 24th February 2011 approved the merger of the Company and Health Network Public Company Limited (Phyathai Hospital Group and Paolo Hospital Group) through an Entire Business Transfer of Health Network Public Company Limited, which is majority held by Mr. Wichai Tongtang and family. The Company paid a total of Baht 9,825,357,789 for the merger, comprised of newly issued common shares of the Company in the amount of no more than 230,870,405 shares at Baht 37.75 per share, equal to no more than Baht 8,715,357,789 and cash of approximately Baht 680,000,000, as well as transfer of loans and interest incurred from Health Network in the amount of no more than Baht 430,000,000. The Meeting also approved the tender offer for all shares of Prasit Pattana Public Company Limited. - The Company registered additional capital of Baht 1,481,034,024 on 1st April 2011 to pay for the entire business transfer of Health Network Public Company Limited. This increased the Company’s holding in Prasit Pattana Public Company Limited (Phyathai Hospital Group: Phyathai Hospital 1-3 and Phyathai Hospital Sriracha) from 19.47% to 68.64%. In addition, the Company now holds shares of 4 companies within the Paolo Memorial Hospital Group, namely, 100% of Paolo Medic Company Limited (Paolo Memorial Hospital Phaholyotin), 88.73% of Paolo Samutrprakarn Company Limited (Paolo Memorial Hospital Samutrprakarn), 80.72% of Siam Medical Company Limited (Paolo Memorial Hospital Chokchai 4) and 99.76% of Thai Medical Center Public Company Limited (Paolo Memorial Hospital Nawamintr). Consequently, after the mergers, the Company now has 27 hospitals in the Group, from 19 (25 hospitals in Thailand and 2 hospitals in Cambodia), with a total of 4,987 beds, up from 3,193 beds. - The Company made a tender offer on Prasit Pattana Public Company Limited (“PYT”) with a period of 25 business days from 8th April to 23rd May 2011. Payment was offered in two ways, namely, Baht 3.71 cash per share or common shares of the Company (“BGH”) at 10.1706 PYT shares for 1 BGH share. The respondents must choose either option.
Nature of Business
2009 on 14 rai of land and began providing medical services under Bangkok Hua Hin Medical Clinic on 1st November 2010. The Bangkok Hospital Hua Hin is comprised of 5 floors with 60 beds. The first floor accommodates out-patients and emergency services. The second floor houses surgery theaters and ICU. On the third floor, there are the Bio Molecular Laboratory, Administration offices, Executive offices and training facilities. The fourth and fifth floors are for in-patient rooms. Total usable area is 12,000 square meters. The helicopter pad for patient transfers to hospitals in Bangkok is on the 6th floor. - Bangkok Hospital opened the Bangkok Sports and Exercises Medicine Center and uses sports and exercise medicine in healing and developing physical ability of athletes, both professionals and amateurs, both national team athletes and the general public, so that they may play sports or exercise efficiently with less injury. The Center also provides rehabilitation after playing sports by expert physicians in sports medicine. In addition, Bangkok Hospital provided medical check-ups to Thai national team athletes for SEA Games, Asian Games and the Olympic Games, as well as sponsored the Football Association of Thailand, taking care of the Thai national football team for more than 15 years. - Wattanosoth Hospital performed advanced medicine by utilizing PET/CT in detecting brain cell deterioration to find the cause in the of Alzheimer disease in the early stages. Services - Wattanosoth Hospital purchased the CT Simulator to - The Company officially commenced operations of better view details of X-rays in 3D, which reduced the Bangkok Hospital Hua Hin on 6th April 2011. Construction on the Hospital started on 11th November time in planning treatment.
27 Annual Report 2012
After the tender offer, the Company held 97.10% of PYT outstanding shares, up from 68.64%. The Company issued 64,366,277 rights shares to respondents who chose to receive BGH shares, resulting in Baht 1,545,400,481 of paid-up capital from Baht 1,481,034,024. - The Company increased paid-up capital by another Baht 58,402 to accommodate the conversion of the convertible bonds to common shares of the Company, resulting in a paid-up capital of Baht 1,545,458,883. The convertible bonds matured in July 2011, therefore, the Company no longer has any convertible bond obligations. - The Company invested in an additional 1,474,000 common shares of Udon Pattana (1994) Company Limited (Ake Udon Hospital) equal to 4.9%, resulting in 4,474,000 shares or 14.9% of shares outstanding, up from 3,000,000 shares or 10%. When including ownership of Udon Pattana shares through Prasit Pattana Public Company Limited and Ramkamhaeng Hospital Public Company Limited, a subsidiary and associated company respectively, the Company holds 28.17% of shares outstanding of Ake Udon Hospital. - The Company set up a subsidiary, “Bangkok Premier Life Insurance Broker Company Limited” with registered and paid-up capital of Baht 4.0 million (Baht 10 par value). Presently, the subsidiary has registered and paid-up capital of Baht 20 million.
Nature of Business
- The Bangkok Spine Academy, Bangkok Hospital, organized the biggest spine seminar of the year entitled “Master Classes in Advanced Spine Surgery” and was honored to have Dr. Rick Delamarter and Dr. Daniel K. Riew, renowned spine surgeons from the United States, as guest speakers. The event was attended by Dr. Phudhiphorn Thienprasit, Senior Director of the Bangkok Spine Academy, along with the surgical team to exchange experiences in spine medicine. - The Embassy of Japan and Bangkok Hospital organized the cooperation agreement signing ceremony between Bangkok Hospital and 10 hospitals in Japan. The event was presided over by His Excellency Mr. Seiji Kojima, the Ambassador of Japan to Thailand and Dr. Prasert Prasarttong-osoth, CEO& President. Bangkok Hospital, as well as representatives from hospitals in Japan. This signified the good relationship between hospitals in Thailand and Japan. - Bangkok Hospital opened Bangkok Plaza, a center for food, 24-hour convenience store and banking services to provide convenience to patrons of the Hospital and people living in Soi Soonvijai area on 11th November 2011. - The Bangkok Hospital opened Bangkok Hospital Counter Service in the departure area of Suvarnnabhumi International Airport to provide services to foreign patients who travelled to Thailand to receive medical care at the Hospital. - Bangkok Hospital Ratchasima Company Limited, a subsidiary in which the Company holds 89.7% opened the “Bangkok Hospital Pakchong”, a 30 bed hospital in Pakchong District, Nakornratchasima Province, making it the 28th hospital in Thailand for the Bangkok Hospital network (26 hospitals in Thailand and 2 hospitals in Cambodia.
Annual Report 2012
28
2012 - The Company invested in an additional 70,522,600 common shares of Bumrungrad Hospital Public Company Limited equal to 9.66% of registered and paid-up capital. Consequently, the Company now holds 174,350,200 shares or 23.88% of registered and paid-up capital of Bumrungrad Hospital Public Company Limited. - The Annual General Meeting of the Shareholders in 2012 approved the decrease of registered capital in the amount of Baht 7,932,525 from Baht 1,553,391,408. This resulted in new registered capital of Baht 1,545,458,883. The Meeting also approved increase in registered capital by way of a general mandate in the amount of Baht 154,545,888 from Baht 1,545,458,883, resulting in new registered capital of Baht 1,700,004,771for flexibility in raising capital for the business. However, to date, the Company has not increased capital through said general mandate. - Bangkok Dusit Medical Services Public Company Limited made a tender offer for all outstanding shares of Prasit Pattana Public Company Limited (“PYT”) in order to delist shares of PYT from the Stock Exchange of Thailand with the Office of the Securities and Exchange Commission. After the tender offer, Prasit Pattana Public Company Limited delisted shares from the Stock Exchange of Thailand on 4th May 2012 and the Company now holds 98.32% of Prasit Pattana Public Company Limited. - The Company established a new 100% owned subsidiary under Bangkok Hospital Chiangmai Company Limited to construct a 200-bed hospital in Muang District, Chiangmai Province with registered capital of Baht 1,000 million and paid-up capital of Baht 250 million.
Nature of Business
injuries sustained by the athletes and rehabilitation as well as increasing physical fitness, preparation techniques before games and sports techniques for the greatest efficiency of the athletes, including nutrition and sports psychology. - Bangkok Hospital opened the Bangkok Academy of Sports and Exercise Medicine (BASEM) to strengthen our capabilities and raise the level of service with over Baht 70 million invested. BASEM was established to meet our objective of being the leader in health care, to meet the lifestyles of the new generation that like to exercise and play sports, as well as to provide care for sports-related injuries and analysis of problems in playing sports. The services include medical care of injuries sustained by the athletes and rehabilitation as well as increasing physical fitness, preparation techniques before games and sports techniques for the greatest efficiency of the athletes, including nutrition and sports psychology. Services in sports medicine will support Thailand’s desire to be the medical hub and lead Bangkok Hospital to become the top sports medicine institute in ASEAN. - Bangkok Premier Life Insurance Broker, a subsidiary, which has expertise in health insurance within the Bangkok Hospital network, has joined hands with Muang Thai Life Assurance Company Limited to raise standard of living and health care by introducing an innovative life insurance product, health insurance and open up various channels of service. The cooperation has brought about newly developed health insurance policies that meet the needs of the consumers to access quality medical care while saving costs when in need.
29 Annual Report 2012
- The Company established a new 100% owned subsidiary under Bangkok Hospital Udorn Company Limited to operate a 120-bed private hospital on Thongyai Road in Muang District, Udornthani Province with registered and paid-up capital of Baht 500 million. The subsidiary bought the business from Udorn Panyavej Hospital and officially commenced business as Bangkok Hospital Udorn on 12th December 2012, making it the 29th hospital in the Bangkok Hospital Group. - The Bangkok Hospital network is visionary in introducing technological innovation, namely ROBO DOCTOR or Remote Presence System from U.S.A., to increase efficiency of patient care. Patients have close and fast access to specialist physicians so that people in remote areas can be treated by standardized specialists. ROBO DOCTOR has been introduced in three hospitals, namely, Bangkok Hospital (Soi Soonvijai), Bangkok Hospital Phuket and Bangkok Hospital Pattaya to provide efficiency in patient referral and fast access to specialists. Patients and doctors are able to interact face-to-face and exchange information, which strengthens efficiency of care and confidence of the patients in accepting medical care. - Bangkok Hospital Medical Center and the College of Sports Science and Technology, Mahidol University received the FIFA Medical Centre of excellence Certificate from Jiri Dvorak, M.D., FIFA Chief Medical Officer. We are the first in Thailand and the ASEAN region and third in Asia (Japan, Qatar, Thailand and Saudi Arabia) to receive such honor. Currently, there are only 26 medical institutions around the world that have received such recognition. This clearly shows the continued dedication and role of Bangkok Hospital Medical Center in sports medicine. We have been responsible for taking care of the health of national football players and team members of the Thai premier league, in terms of medical care of
Nature of Business Annual Report 2012
30
- The Phyathai Hospital Group and the Bangkok Hospital Group joined forces to open the Phyathai 3 Heart Center by Bangkok Heart Hospital with a budget of over Baht 100 million to expand client base in Thonburi area. Reiterating the Group’s leadership in heart hospitals that meet international standards and the use of Off-Pump CABG. Moreover, the heart hospital provides complete service in health care and heart disease with state-ofthe-art technology and a team of specialists in all fields of heart disease to meet the international standards (JCI) and provide heart patients in the Thonburi area with the same level of service as received at Bangkok Heart Hospital. The Hospital provides complete diagnosis and treatment of heart and coronary disease from initial diagnosis, examination using special equipment, care and prevention of heart disease, surgery and after surgery recovery, as well as rehabilitation of the heart using internationally recognized modern medical equipment and technology. - The Bangkok Hospital Group joined forces with the Paolo Memorial Hospital Group to develop medical technology and medical services by opening the “Cancer Center” Paolo Memorial Hospital by Wattanosoth Hospital to meet the needs and lifestyles of patients as much as possible. The Center provides complete services in the prevention and treatment of cancer from detection of first stages of cancer, planning, treatment once detected to radiology to stop the spreading of cancer cells by a team of specialist doctors. - The Bangkok Spine Academy, Bangkok Hospital announced the success of a new surgical technique developed in Thailand to treat back pain through Direct Lateral Interbody Fusion (DLIF). The surgery treats back and leg pain caused by the spine pressing on the nerves or scoliosis. The distinctive points of this surgery are that it does not destroy the back muscles, less blood loss, small scar, and fast recovery. This technique uses Intraoperative Neuromonitoring sent through a 1-inch tube to monitor the nerves and spine. Then a replacement Intervertebral disc is inserted making the spine stronger, enabling it to carry more body weight and lessening back pain. Moreover, the technique can effectively treat Spondylolisthesis or Scoliosis in elderly patients without having to make incisions along the back muscles, which may help lessen chronic back pain, median nerve entrapment, loose screws or loss of back muscle that occur after conventional surgery. - Bhumibol Adulyadej Hospital, Wattanosoth Hospital and Paolo Memorial Hospital Nawamin, being three public and private hospitals, joined together to organize the memorandum of understanding signing ceremony entitled “Out-Patient Referral for Radiology Treatment” for cancer patients using state-if-the-art medical technology to increase potential of radiology treatment for cancer patients of every group.
1. Private Hospitals Business Bangkok Hospital Group Bangkok Hospital 1 Bangkok Heart Hospital 2 Wattanosoth Cancer Hospital 3 Bangkok Hospital Hua hin 4 Bangkok Hospital Prapradang 5 Bangkok Hospital Pattaya 6 Bangkok Hospital Rayong 7 Bangkok Hospital Chantaburi 8 Bagnkok Hospital Trat 9 Bangkok Hospital Ratchasima 10 Bangkok Hospital Pakchong 11 Bangkok Hospital Udon 12 Bangkok Hospital Samui 13 Bangkok Hospital Phuket 14 Bagnkok Hospital Had Yai 15
Operated By
Bangkok Dusit Medical Services PLC. Bangkok Dusit Medical Services PLC. Bangkok Dusit Medical Services PLC. Bangkok Dusit Medical Services PLC. Bangkok Prapradang Hospital Co., Ltd Bangkok Pattaya Hospital Co., Ltd Bangkok Rayong Hospital Co., Ltd Wattanavej Co., Ltd. Bangkok Trat Hospital Co., Ltd. Bangkok Hospital Ratchasima Co., Ltd. Bangkok Hospital Ratchasima Co., Ltd. Bangkok Hospital Udon Co., Ltd. Bangkok Samui Hospital Co., Ltd. Bangkok Phuket Hospital Co., Ltd. Bangkok Had Yai Hospital Co., Ltd. บริษัท สมิติเวช จำกัด (มหาชน) Samitivej Group Samitivej Hospital (Sukumvith) Samitivej Plc. (SVH) 16 Samitivej Hospital (Srinakarin) Samitivej Plc. (SVH) 17 Samitivej Hospital (Sriracha) Samitivej Sriracha Co., Ltd. 18 BNH Hospital BNH Medical Center Co., Ltd. 19 Angkor Pisith Co., Ltd. Royal Hospital Group Royal Angkor Pisith Angkor Pisith Co., Ltd. 20 Royal Rattanak Hospital Rattanak Medical Services Co., Ltd. 21 บริษัท โรงพยาบาลพญาไท 1 จำกัด Phayathai Group Phaya Thai 1 Hospital Phaya Thai 1 Hospital Co., Ltd. 22 Phaya Thai 2 Hospital Phaya Thai 2 Hospital Co., Ltd. 23 Phaya Thai 3 Hospital Phaya Thai 3 Hospital Co., Ltd. 24 Phaya Thai Sriracha Hospital Phaya Thai Sriracha Hospital PLC. 25 บริษัท เปาโลเมดิค จำกัด Paolo Memorail Hospital Group Paolo Memorial Hospital Phaholyothin Paolo Medic Co., Ltd. 26 Paolo Memorial Hospital Samutprakarn Paolo Samut Prakran Co., Ltd. 27 Paolo Memorial Hospital Chokchai 4 Siam Medical Co., Ltd. 28 Paolo Memorial Hospital Nawamin Thai Medical Center PLC. 29
Number Total number % of of Bed Holding of bed 343 97 48 60 60 400 220 170 114 300 30 120 50 317 165 275 400 150 144 21 30 350 260 230 257 237 200 120 140
2,494
79.00% 97.22% 100.00% 99.69% 99.76% 90.36% 90.36% 100.00% 100.00% 99.68% 98.79%
825 144
95.76% 95.76% 68.06% 91.48%
51
80.00% 70.00%
1,097
100.00% 99.15% 98.20% 66.53%
697 5,308
100.00% 93.30% 85.69% 99.76%
Nature of Business
Hospital
31 Annual Report 2012
Number
Number
Hospital
Operated By
Group of invested Hospital (Company has not manage) Aek Udon International Hospital Udon Pattana (1994) Co., Ltd. 30 Ramkamhaeng Hospital Ramkamhaeng Hospital PCL. 31 Krungthon Hospital Krungthon Hospital PCL 32 Bumrungrad Hospital Bumrungrad Hospital PCL 33
Number Total number % of of Bed Holding of bed 350 300 150 538
28.56%* 38.24% 20.01% 23.94%
1,338
Remark : *Company held directly 15.26% and held trough subsidiary 13.3%
Nature of Business
2. Non Hospitals Business
Annual Report 2012
32
Nature of Business 1. Manufacture saline and medical equipment 2. Medical Lab and Share Services (central purchase and accounting) 3. Bio Molecular Lab 4. Information and technology for company and the Subsidiaries Share service 5. Medical Evacuation 6. Marketing and promotion support company and the subsidiaries 7. Cartering and General support for company and the subsidiaries
8. Land holding company in cambodia
9. Healthcare Business (Holding Company) 10. Training 11. Insurance broker
Operated By A.N.B. Laboratory Co., Ltd. (Held trough Royal Bangkok Healthcare Co., Ltd., which is the company subsidiary own 100%) Medicpharma Co., Ltd. National Healthcare Systems Co., Ltd. (Company held directly 74% and held trough subsidiary 24.9%) Bio-Molecular Laboratories (Thailand) Co., Ltd. Greenline Synergy Co., Ltd.
% of holding 100.0 49.0 98.9 95.0 100.0
Bangkok Helicopter Services Co., Ltd. Cool & Joy Co., Ltd.
49.0 30.0
First Health Food Co., Ltd. (Held trough Samitivej PLC, which is the company subsidiary ) Sodexo Healthcare Support Service (Thailand) Co., Ltd. (Held trough First Health Food Co., Ltd. , which is the Samitivej PLC.'s subsidiary ) Irving Sheridan SE Co., Ltd. (Held trough Samitivej PLC, which is the company subsidiary ) S.R. Property Investment Co., Ltd. Siem Reap Land Investment Co., Ltd. Phnom Penh First Property Co., Ltd Asia International Healthcare Co., Ltd Royal Bangkok Healthcare Co., Ltd. BDMS Training Co., Ltd.
99.0
49.0 49.0 49.0 100.0 100.0 100.0
Bangkok Health Insurance Co., Ltd. Bangkok Premier Life Insurance Co., Ltd.
100.0 100.0
74.0 96.0
Revenue Structure of Company and Subsidiaries Between year 2010-2012
Patient revenue Bangkok Dusit Medical Services PLC. Samitivej PLC. (SVH) BNH Medical Center Co., Ltd. Prasit Patana PLC. (PPCL) Paolo Medic Co., Ltd. (1)(2) Siam Medical Co., Ltd.(1)(2) Thai Medical Center PLC. (1)(2) Paolo Samut Prakran Co., Ltd. (1)(2) Bangkok Hosital Prapradaeng Co., Ltd. Bangkok Hospital Pattaya Co., Ltd. Bangkok Hospital Rayong Co., Ltd. Bangkok Hospital Trad Co., Ltd. Wattanavej Co., Ltd. Bangkok Hospital Had Yai Co., Ltd. Bangkok Hospital Samui Co., Ltd. Bangkok Hospital Phuket Co., Ltd. Bangkok Hospital Ratchasima Co., Ltd. Bangkok Hospital Udon Co., Ltd. Angkor Pisith Co.. Ltd. Rattanak Medical Services Co., Ltd. Total Other revenue which related to patient revenue National Healthcare Systems Co., Ltd. Bio-Molecular Laboratories (Thailand) Co., Ltd. Total Total revenue from operation
2012 % of Holding Revenue %
100.0 95.8 91.5 98.3 100.0 85.7 99.8 93.3 79.0 97.3 100.0 99.8 99.7 98.8 100.0 99.7 90.4 100.0 80.0 70.0
9,909.3 7,580.7 1,869.9 8,714.1 1,979.3 712.7 675.3 1,087.3 240.2 3,167.5 1,575.9 321.3 852.3 1,110.0 545.9 2,319.1 1,113.2 73.6 112.8 176.0 44,136.4
74.0 95.0
168.9 2.0
Remarks 1 Subsidiaries from the Company acquisition in year 2011 2 Subsidiaries from the Company acquisition in year 2012
2011 Revenue %
22.4 8,218.7 17.1 6,687.7 4.2 1,579.7 19.7 5,632.8 4.5 1,339.0 480.8 1.6 420.3 1.5 720.3 2.5 202.9 0.5 7.1 2,793.1 3.6 1,359.9 299.4 0.7 717.0 1.9 944.8 2.5 459.4 1.2 5.2 2,065.8 925.6 2.5 0.2 95.5 0.3 155.8 0.4 99.6 35,098.4 0.4 0.0
121.1 5.0
23.3 19.0 4.5 16.0 3.8 1.4 1.2 2.0 0.6 7.9 3.9 0.8 2.0 2.7 1.3 5.9 2.6
2010 Revenue %
7,182.8 30.5 5,887.9 25.0 1,466.1 6.2
181.7 0.8 2,499.7 10.6 1,193.5 5.1 275.2 1.2 647.3 2.8 770.5 3.3 432.8 1.8 1,839.3 7.8 817.9 3.5
83.9 0.4 0.3 130.2 0.6 0.4 99.6 23,408.8 99.6 0.3 0.0
55.6 48.2
0.2 0.2
170.90 0.39 126.10 0.4 103.80 0.4 44,307.3 100.0 35,224.5 100.0 23,512.6 100.0
Nature of Business
Operated by
33 Annual Report 2012
Type of revenue
Unite : Million Baht
Corporate Social Responsibility Activites
Corporate Social Responsibility Activities - Project “Urbanites Unite for Good Health”: Bangkok Hospital in association with the Lumpini Youth Center and the Culture, Sports and Tourism Department of the Bangkok Metropolitan Administration has organized this project to promote health care and exercise for the people of Bangkok. This event has been organized monthly for the past 14 years at Lumpini Park. Bangkok Hospital brings in doctors to share secrets in taking care of one’s health in front of the Elderly Citizen Building in Lumpini Park. The event provides various basic medical check-ups free of charge.
Annual Report 2012
34
- Project “Basic Life saving Skills (CPR)”: Bangkok Hospital realizes that the death rate from various emergency situations has risen continuously. Consequently, we have organized training courses in basic life saving skills taught by emergency unit doctors and nurses. The project was initiated with participants from the Soi Soonvijai area as it is close to the hospital. Participants attended a lecture and had opportunity to practice life saving skills such as how to help people who have fainted, how to help people who are choking as well as first aid, including burns, nose bleeds, scalding from hot water and poison bites from snakes and bees. The event was held at the Pongsak Viddyakorn Meeting Room, Bangkok Rehabilitation Center, Bangkok Hospital.
Corporate Social Responsibility Activites
- On the occasion of World Heart Day, Bangkok Heart Hospital, one of the leaders in providing medical care for heart patients, organized “Healthy Heart Thailand” under the concept “One World, One Heart, One Home” at Central Plaza Ladprao. The event was designed to provide knowledge on how to change behaviors to decrease the risk and ways to lessen the severity of “coronary and heart disease” so that Thai people are alert and understand the dangers that are close to them and how to prevent the disease as well as how to appropriately and seriously take care of one’s heart including the hearts of family members. The activity was a pro-active one using the Healthy Heart Model (4H) namely, Healthy Heart Active, an exercise program to strengthen the heart led by a team of physical therapists; Healthy Heart Diet, a program demonstrating how to cook healthy food; Healthy Heart Emotion, a program to induce happiness for the good of the heart; and Heart Don’t, a program on reducing bad things for the heart and advice on techniques in preventing and treating heart disease.
- Bangkok Hospital in association with the Football Association of Thailand organized the Warm-Up Program and brought in FIFA to provide warm-up techniques, prevention of injuries. The FIFA Medical Assessment and Research Committee (F-MARC) sent Mr. Mario Bizzini, Ph.D., PT to Thailand to teach those involved in the training of athletes such are trainers, assistant trainers, team physical fitness trainers, sports scientists, team nurses or physical therapists so that they may use these techniques to care for their football players to decrease up to 30% of injuries. The Program was broadcasted across the country via teleconference to Bangkok Hospital Pattaya, Bangkok Hospital Ratchasima, Bangkok Hospital Phuket and Bangkok Hospital Had Yai so that trainers, fitness trainers and physical therapists of regional football teams can attend the training course at the same time.
Annual Report 2012
35
Corporate Social Responsibility Activites
Activities of the Vejdusit Foundation Under the Royal Patronage of HRH Princess Galyani Vadhana Krom Luang Naradhiwas Rajanagarindra in 2012 1. 3rd Big Hat Big Give The Vejdusit Foundation in association with the Big Knit Company Limited donated 1,200 knitted hats to underprivileged children in remote areas in Thailand by presenting the donation to Her Royal Highness Princess Maha Chakri Sirindhorn.
2. 2012 Medical, Nursing and Public Health Research Scholarships A total of 5 scholarships were awarded equaling Baht 734,000. This is the 10th consecutive year of the scholarship program with a total of 57 scholarships equaling Baht 7.7 million awarded to date.
Annual Report 2012
36
3. Helping the Less Fortunate on Tour 2012 A project to help the less fortunate to have a better quality of life with regards to physical and mental health. The Tour provided doctors, nurses and staff to carry-out medical check-ups as well as distribute medicine, medical supplies and equipment and basic consumer goods to the underprivileged such as the following: (the Tour traveled every month)
• Disadvantaged children at Banglamung Home for Boys
• Underprivileged children affected by the flooding of schools in the Bangpahan District, Ayudhaya Province at Wat Bangplerng School, Wat Thangklang School, Wat Kaewta School and Wat Tarnlen School
• Underprivileged children at Border Police Patrol School in Baan Praektakrau, Prachuabkirikun Province • Children with intellectual disabilities at Rajanukul Institute Under the Royal Patronage of HRH Princess Galyani Vadhana Krom Luang Naradhiwas Rajanagarindra
37 Annual Report 2012
• Underprivileged children at Mahamek Home for Boys
Corporate Social Responsibility Activites
• Infants in the slums at Foundation for Slum Child Care Under the Royal Patronage of HRH Princess Galyani Vadhana Krom Luang Naradhiwas Rajanagarindra - Onnuch Garbage Site Community - Nongkaem Garbage Site Community
Green Health Project Annual Report 2012
38
Green Health Project The Bangkok Hospital Group Green Health Project is a CSR project of the Bangkok Dusit Medical Services Public Company Limited. The aim is to use the knowledge in medicine and public health to take care of the health of the Thai people, especially to help society’s underprivileged, and to expand the project to promoting total wellness in society. The project is carried out by 5 hospital groups within the Bangkok Hospital network, namely, Bangkok Hospital Group, Samitivej Hospital Group, BNH Hospital, Phyathai Hospital Group and Paolo Hospital Group. It is the first time in Thailand that 26 hospitals have come together for Green Health. The concepts total wellness, which are at the heart of this project, are as follows:
1. Physical Health
Exercising, whether it be choosing to walk instead of using the elevator or regular exercise, will help make your body strong.
2. Mental Health
Smile more often, calmly face problems, practice clearing your mind of stress as your mental health will affect your body.
3. Medical Health Care
Get medical check-ups yearly at accredited hospitals.
4. Food & Nutrition
More important that delicious food is quality food for better health. The 5 fatal diseases in Thailand are diabetes, high blood pressure, heart attack, stroke and cancer are all related to a bad diet.
5. Environment
Increase green areas so that the environment is more pleasing. Reduce, abstain and quit wasting resources. In taking care of one’s health, one must also take care of the environment.
Main Events of the Project in 2012
2. Green Health @ School The project donates the “Good Health Room” for children and youths. A team of pharmacists and nurses go into the schools to renovate the first aid room as well as provide medicine and first aid kits. The team also provides training in public health and organizes beneficial activities to impoverished schools across the country. Presently, Bangkok Hospital Group, Samitivej Hospital Group, Phyathai Hospital Group and Paolo Memorial Hospital Group have organized this activity for 48 schools in every region including the following provinces: Bangkok, Samutprakarn, Samutsongkram, Chonburi, Rayong, Trad, Prachaubkirikhan, Ayudhya, Nakronrachasima, Songkla and Maehongsorn. Contact the Green Health tel: 1719 Website : www.greenhealthbangkokhospitalgroup.com http://www.facebook.com/GreenHealthbyBangkokHospitalGroup
1 1. Mr. Prasert Prasarttong-Osoth, M.D., CEO & President, along with executives of the Bangkok Hospital network, representing the Bangkok Hospital Group, Samitivej Hospital Group, BNH Hospital, Phyathai Hospital Group and Paolo Hospital Group.
39 Annual Report 2012
In 2012, the Green Health care & Share Project received 85 pieces of nursing equipment from 19 generous donors as well as monetary donations of Baht 456,000.00 from 18 benefactors. The Project used part of the monetary donations to purchase additional new nursing equipment, thus totaling 171 pieces of nursing equipment. A total of 101 pieces of equipment were donated such as 6 wheelchairs, 1 stainless steel commode wheelchair, 1 oxygen concentrator, 88 walkers, single canes and tripod canes, 3 blood pressure monitors, nursing beds and other nursing equipment.
Green Health Project
1. Green Health Care & Share A project for sharing and as well as a center for donations of used and new nursing equipment to give to elderly patients and people with disabilities who are in need. Apart from helping those in need of essential nursing equipment, the project also encourages making good use of equipment as some of them may not be in use as the patients no longer need them or have passed away. Reusing nursing equipment can also help save the environment.
Green Health Project
2
3
4
5
6
6.1
7
7.1
7.2
8
9
10
11
11.1
12
Annual Report 2012
40
2. Brand Ambassadors of all 5 dimensions of the Green Health Project: Mr. Pongsakorn Chindawatana, M.D., Ms. Apissada Unsuphan, Ms. Pavita, Panyapool, Ms. Chayarnpat Suyakot and Ms. Suthirat Kaewwiset. 3. Inaugural launch of the Green Health Project on 30th July 2012 attended by Mr. Prasert Prasarttong-Osoth, M.D., CEO & President and celebrities, as well as donors in the Green Health Care & Share program. 4. Ms. Apiwan Piyasiranont donated 4 pieces of nursing equipment including bath bench, tripod cane, walker and gel positioner at the Green Health booth on 1st floor of Bangkok Hospital. 5. Wheelchairs delivered to monks who have suffered from a stroke or bone disease in Chiangmai Province. 6. Patients with paresis or physical disabilities in Chiangrai Province. 6.1 Wheelchairs delivered to patients in Chiangrai Province. 7. Mr. Pongsakorn Chindawatana, M.D. Brand Ambassador of the 4th dimension of wellness (Take care, prevent, know the disease) presented and demonstrated how to use the wheelchair to relatives of the patient at Bangkok Hospital. 7.1 Assistant Professor Ajjima Srethaputr, Mr. Pongsakorn Chindawatana, M.D. and Green Health staff presented wheelchairs to representatives of Huai Khwang District Office and wife of paresis patient from Chumchon Bueng Praram 9, Bangkok at the Green Health booth on 1st floor of Bangkok Hospital. 7.2 Paresis patient who received the wheelchair donation, with his wife, at Chumchon Bueng Praram 9, Bangkok. 8. Assistant Professor Ajjima Srethaputr presented the oxygen concentrator to the son of a patient who is in persistent vegetative state from shock at Phutthamonthon Sai 1, Bangkok. 9. Volunteers of the Green Health Care & Share Project presented 85 pieces of new nursing equipment to Parn Hospital, Muang Parn District, Chiangrai Province. 10. The Pringpuangkaew Family presented the Green Health Care & Share Project with 2 wheelchairs. 11. Presented an oxygen concentrator to Mrs. Korng Srichompu, a cancer patient, in Nong Khai Province. 11.1 An oxygen concentrator is delivered to a cancer patient in Nong Khai Province. 12. Ms. Thanjira Thanaworapongprapa donated a patient bed to Mr. Sopon Nilsamak, a paralyzed patient, in Chaiyaphum Province.
14
15
15.1
16
17
18
19
20
Green Health Project
13
21
22
22.1
23
23.1
23.2
13. Bangkok Hospital Hua Hin presented the “Good Health Room” to Border Police Patrol School in Baan Praektakrau, Prachuabkirikun Province 14. Samitivej Hospital Group and BNH Hospital presented the “Good Health Room” to Nongpluang Pittaya School, Nakornratchasima Province 15. Students representing the Maptaput Panpittayakarn School, Rayong Province, accepted the donation of medicine cupboard and Good Health Room sign. 15.1 Bangkok Hospital Rayong presented the “Good Health Room” to Maptaput Panpittayakarn School, Rayong Province 16. Phyathai Hospital 1 presented the “Good Health Room” to Center for Development of Pre-schoolers, Makkasan Rail Tracks 17. Phyathai Hospital 2 presented the “Good Health Room” to Wat Bang Plerng and Wat Thang Klang Schools in Ayudhaya Province 18. Phyathai Hospital 3 organized the “Green Health Youth Ambassadors” event with participation from 100 students from 20 schools in the Thonburi area in order to develop model youths by providing training on 5-dimensions of health and tree planting workshop 19. Paolo Memorial Hospital Group renovated the first-aid room at Wat Bang Chalongnork School, Samutprakarn Province 20. Paolo Memorial Hospital Group painted and renovated the multi-purpose building at Wat Kloong Koen School, Samutsongkram Province 21. Paolo Memorial Hospital Group renovated the firs-aid room at Baan Don Chan School, Samutsongkram Province 22. Bangkok Hospital presented the “Good Health Room” to Wat Kaewta School, Ayudhaya Province 22.1 Nurses from Bangkok Hospital explained how to use the medicine and medical supplies to staff at Wat Kaewta School, Ayudhaya Province 23. Representatives of Bangkok Hospital renovated the first-aid room, for example, changing the bed sheets, at Baan Pongsai School, Saraburi Province 23.1 Pharmacists from Bangkok Hospital selected and presented medicine and medical supplies to Baan Pongsai School, Saraburi Province 23.2 Bangkok Hospital presented the “Good Health Room” to Baan Pongsai School, Saraburi Province
Annual Report 2012
41
Research & Development
Research & Development
In carrying out the Bangkok Hospital Medical Center’s mission is to provide quality medical services, we strive to promote and support research that meet international standards to bring about knowledge or innovation, which will lead to development of quality or efficiency of medical services and improve the quality of life of our patients. In 2012, there were 4 research projects that have been completed and are in the process of analysis and reporting for further publication as follows:
Annual Report 2012
42
1. Active Surveillance Cultures to Screen for Methicillin-Resistant Staphylococcus Aureus (MRSA) in Referral Patient in Critical Care Unit, Bangkok Hospital Medical Group 2. Retrospective Study of Hospitalized Patients with Dengue Infection During January 2010 – December 2010 3. Retrospective Study of Hospitalized Patients with Influenza in Adult During January 2010 – December 2010 4. Prevalence and Risk Factors of Asymptomatic Carotid Artery Disease in Thai Population who Attend Annual Check-up Program at Bangkok Hospital Medical Center In 2012, there were 8 new research projects initiated by medical personnel at the Hospital. Of those 8
projects, 2 have been approved by the Hospital’s Institution review board and ethic committee and have already
commenced, namely:
1. A Qualitative Study of the Effectiveness of Group Support Activities in Patient and family at Watthanosoth Hospital 2. Thai Translation of Migraine Disability Assessment (MIDAS) and Test-Retest Reliability Study of The Thai versions As for the other 6 new research projects, they are under review and approval by the Hospital’s Institution review board and ethic committee and will commence in 2013. Those projects are as follows: 1. Retrospective Study Effectiveness Influenza Vaccination in Healthcare workers: The Bangkok Medical Center Experience 2. The effect of Stick Exercise in Combination with Bobath Technique in the Prevention of Shoulder Subluxation in Acute Stroke Patients 3. Study of Development and Effectiveness of Clinical Practice Guidelines for Minimization of Severe Oral Mucositis During Chemo-Radiotherapy in Head and Neck Cancer at Wattanosoth Hospital
6. Headache Registry Program Additionally, in 2012, the Bangkok Hospital Medical Center has conducted clinical research in conjunction with other research departments and received approval from the Hospital’s Institution review board and ethic committee as follows: 1. Screening for a critical congenital heart disease in neonate at the Bangkok hospital medical center 2. Rivaroxaban Safety Profile in the Prophylaxis of Venous Thromboembolism After Hip Fracture Surgery 3. A randomized, prospective double blind study to assess the efficacy and safety of Enteric - coated peppermint-oil capsules in Thai irritable bowel syndrome
In 2012, Bangkok Health Research Center expanded health research to the community through academic and survey research cooperation from the ABAC Poll Research Center. The first joint research project, “Survey of Attitude and Behavior of Motorcyclists and Passengers in Bangkok towards wearing Safety Helmets” was completed and published in December 2012. The knowledge gained from this research can be used to promote the wearing of safety helmets to prevent injuries and death from brain damage. The Bangkok Hospital Medical Center strives to continue to expand research cooperation with leading research institutions both domestic and international.
Research & Development
5. Creation of Simplified Nutrition Screening Tool for Dietitian
In order to increase research capabilities at the Bangkok Hospital Medical Center and expand services to support research in all areas within the Bangkok Dusit Medical Services network, we have reorganized and established a new research and development department under the name “Bangkok Health Research Center, Bangkok Hospital on 1st November 2011”.
43 Annual Report 2012
4. Prevalence and Risk Factors of Prediabetes in Checkup Patients at Bangkok Medical Center
Healthcare Industry Outlook and Competition
Healthcare Industry Outlook and Competition
Annual Report 2012
44
In 2012, the private hospital sector has continuously grown as a result of an increase in income per capita and number of patients which driven by the growing number of the aging population, the increase in medical tourism and also from people becoming more health conscions. As a result of these drivers together with the growth of private hospital in upcountry, the private hospital sector in the long term still has potential to grow especially after the creation of ASEAN Economic Community (AEC) in 2015. The private hospital market can be divided into 2 groups as follows:
1. Domestic Patients
Statistics show that the growth of healthcare expenditure in Thailand in 2011 is around 3.1% or Baht 168,713 million. From 2002 to 2011, the compound annual growth rate (CAGR) of healthcare expenditure was 5.6% per annum compared to the GDP growth rate of 4.0% during the same period. Therefore, health expenditure grew faster than GDP growth. Growth of healthcare expenditure compared to GDP since 2002-2011 GDP Year
Health expenditure
Value (Million Baht)
Growth Rate (%)
Value (Million Baht)
Growth Rate (%)
3,237,042 3,468,166 3,688,189 3,858,019 4,054,504 4,259,026 4,364,833 4,263,139 4,596,112 4,599,655
5.3 7.1 6.3 4.6 5.1 5.0 2.5 -2.3 7.8 0.1 4.0
103,705 111,784 120,577 130,213 138,970 143,280 150,192 158,499 163,630 168,713
3.1 7.8 7.9 8.0 6.7 3.1 4.8 5.5 3.2 3.1 5.6
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 CAGR (’02 – ‘11)
Source: Office of the National Economic and Social Development Board
Statistics also show the continued growth of domestic inpatient and outpatients from 2.6% in 2002 to 7.3% in 2011 with the CAGR during 2002-2011 of 6.8% per annum.
Number of In-Patients
Number of Out-Patients
Total Number of Patients
Growth Rate (%)
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
5,564,656 6,220,845 6,772,814 7,749,734 8,092,741 8,911,696 9,497,993 10,307,684 11,223,834 16,489,248
99,325,944 103,281,854 100,058,309 106,251,652 118,422,898 130,741,335 140,078,456 152,428,645 164,766,694 172,416,262
104,890,600 109,502,699 106,831,123 114,001,386 126,515,639 139,653,031 149,576,449 162,736,329 175,990,528 188,905,510
2.6 4.4 (2.4) 6.7 11.0 10.4 7.1 8.8 8.1 7.3
Source: Office of the Permanent Secretary of the Ministry of Public Health and the Office of the National Economic and Social Development Board
Therefore, it is clear that in past 10 years the demand for health services has continuously grown. The driving factors are as follow: 1. Increased Income per capita The government’s policies to increase income per capita through the minimum wage and income for civil servants adjustment in 2012 should enable people to have more purchasing power and increase the healthcare expenditure of households. The ratio of healthcare expenditure to GDP increased from 5.8% in 2002 to 7.1% in 2011. 2. Changes in Demographic Presently, as a result of better education, better access to healthcare services and a downward trend of population growth, aging population growth has been on an increase trend. The average age and the ratio of population that is older than 60 years of age have risen. The Office of the National Economic and Social Development Board (NESB) estimates that the portions of people older than 60 will grow from 9.4% in 2000 to 25.1% in 2030. As the elderly people are more prone to disease, syndrome, and sickness than younger people, this significant change in the demographics will increase demand for the healthcare services. 3. Urban Expansion The National Statistics Office forecasts that the ratio of the population residing in Bangkok and Vicinity area will increase from 31.1% in 2001 to 38.0% in 2020. As the majority of the coverage areas of private hospitals are in the city area, the urban expansion will be one of the key drivers for healthcare services. Moreover, the urbanism comes with an unhealthy lifestyle which may cause a serious illness and chronic disease.
Healthcare Industry Outlook and Competition
Year
45 Annual Report 2012
The number of In-Patients and Out-Patients in Thailand since 2002 to 2011
Healthcare Industry Outlook and Competition Annual Report 2012
46
2. International patients who come to Thailand for healthcare services (Medical Tourism)
Since 2002, there have been numerous foreigners coming to the country for healthcare services with upward trend each year. This is partly due to the government’s policies to support Thailand in becoming the Medical Hub of Asia. Thailand has the competitive advantages over other countries in term of the quality of care, the international qualified clinical personnel, the state of the art medical equipment and technology, and value for money. As private hospitals in Thailand operate business under the network model which allow the hospitals to control their cost through the economy of scale, the hospitals then can provide services at a reasonable price. Moreover, many private hospitals can achieve the international standard accreditations which strengthen foreigners’ confidence in the quality of healthcare services. According to the data from the Department of Health Service Support, the Ministry of Public Health, there is an increase in the number of foreigners who came to Thailand for healthcare services from 1,373,807 persons in 2007 to 2,240,000 persons in 2011 with the CAGR of 13.0% per annum. The significant growth in number of international patients contributes higher healthcare service’s revenue from Baht 41,000 million in 2007 to Baht 97,874 million in 2011. For 2012, the Office of the Permanent Secretary of the Ministry of Public Health estimates that the number of international patients will be approximately 2,530,000 persons and will increase revenue to approximately Baht 121,658 million. Market Outlook and Competition Healthcare services in Thailand are comprised of public and private sector and can be divided the level of medical care into primary care, secondary care and tertiary care. The primary care is for the medical centers that provide general medical services such as clinics or small medical centers. The secondary care includes medical centers that provide a higher level of services to both inpatients and outpatients and provide more complexity treatment than primary care centers. The tertiary care is for the medical centers that provide complete medical care services for complexity diseases with modern medical equipments. These three standard of cares can be connected through the referral system that helps providing a better quality of healthcare services and resources management efficiency. In 2010, the market share of private beds to the total number of beds in Thailand is only 24.5%. The number of beds of hospitals across the country and private hospitals during 2003-2010 Year
Total number of beds in Thailand
Total number of private beds
2003 2004 2005 2006 2007 2008 2009 2010
134,622 133,245 132,920 134,763 139,715 125,866 117,568 134,105
34,863 35,267 35,506 35,806 35,792 36,004 33,405 32,872
Source: Bureau of Sanatorium and Art of Healing, Department of Health Service Support
According to the data from the Bureau of Sanatorium and Art of Healing, there were 321 private hospitals with total of 32,838 beds in 2011.
Average Monthly Income per Household by Region During 2007 - 2011 Region
2007
2009
2011
CAGR
Entire country Central Region Eastern Region Northern Region Northeastern Region Southern Region
18,660 35,007 18,932 13,568 12,995 19,716
20,904 37,732 20,960 15,727 15,358 22,926
23,236 41,631 20,822 17,350 18,217 27,326
5.6 4.4 2.4 6.3 8.8 8.5
Source: Office of the National Economic and Social Development Board, Prime Minister Office
Beside the significant growth in economic and social, the upcountry provinces are a great opportunity for private hospitals as there have a high demand for healthcare services with less competition. The target areas are the location that has potential to attract both Thai and international patients with the large cash flow in the economy and has complete facilities in accommodation, necessary infrastructure and transportation. The introduction of the ASEAN Economic Community (AEC) in 2015 also holds a great opportunity for healthcare sector in Thailand as a leader of medical tourist in Asia. With the geographical advantage right at the center of ASEAN, the healthcare services of Thailand can take advantage of having larger customer bases especially from elderly population around ASEAN and expatriates who come to work in the region. AEC will also enable free flow investment from foreign investors as well as the free flow of healthcare services. Therefore, this is the great opportunity for private hospitals to expand their business to other ASEAN countries and create cross border medical services. Moreover, the AEC blueprint allows free flows of skilled labor including doctors, nurses and dentists that might help the shortage of clinical staffs in Thailand. For domestic patients, the establishment of AEC will promote domestic economic growth reflecting higher purchasing power. People can access better healthcare services which finally increase hospital revenue. For the 2013, the trend still targets on chain hospital especially in upcountry areas to strengthen the network and enhance the potential to compete with other hospital operators. Besides, the hospitals emphasize on clinical staffs as limited resources. However, the essential of business operation are continuously maintaining the healthcare standard in term of quality of care, qualified clinical personnel, modern medical equipment and continuous business development.
Healthcare Industry Outlook and Competition
Market Trend There is an ongoing expansion trend of economic growth and urbanization to upcountry area over the years. According to the data from the National Statistic Office, the average household income and the average personnel expenditure in upcountry area increase at faster price than those in Bangkok and vicinity area. During 2007-2011, the CAGR of monthly income per capita in Bangkok and vicinity area, and upcountry were 4.4% and 6.4% respectively. This rapid growth is mainly due to the higher prices of agricultural products and the expansion of industrial factories to rural area. Therefore, there is a potential growth in economic and social in upcountry provinces.
47 Annual Report 2012
Presently, private hospitals in Thailand mainly compete in term of the network hospitals which enhance effective management in customer bases, service area expansion, economy of scale, resource sharing, and referral system within the network hospital. Additionally, in order to meet the patient rising demand, the private hospitals target to compete in service offering, qualified clinical personnel, advance medical technology medical equipment, and setting speciality medical centers.
Risk Factors 1. Risks from economic volatility
Risk Factors
Even though Thailand’s economy in 2012 has recovered from the flooding in 2011, it was still affected by the global economic slowdown. The World Bank estimated that Thailand’s GDP growth in 2012 would be 4.7%. This growth is mainly from the recovery of household consumption and significant increase in investments by both public and private sectors as a result of the government’s rehabilitation measures after the flooding, consumption stimulus and capital inflows, especially continued direct offshore investments. However, net exports had a negative impact on the growth of GDP as exports were affected by the halt in production in the first half of the year, as well as the decrease in demand from the European Union, China and ASEAN countries in the second half of the year.
Annual Report 2012
48
The World Bank estimates that Thailand’s economy will grow about 5%. This is because the industrial sector is expected to fully recover from the flooding and the recovery, although somewhat slow, of the world economy. Exports in 2013 are expected to grow by 5.5% compared to 3.6% in 2012. Domestic demand, especially in investments, will continue to grow from 2012, as a result of the rapid increase in offshore investments. Furthermore, the government’s policy to support Thailand in becoming the Medical Hub of Asia has resulted in a continued greater number of foreigners coming into the country to receive medical services, thus, increasing demand for health care services and revenue for the Company. Therefore, the volatility of the economy of the country of origin of our patients and the state of the global economy will impact revenue and the number of foreign patients. At the same time, Thailand’s economy depends in part on the world economy. If the problems in the world economy such as the financial volatility of the Euro Zone, especially in Greece and Spain, and the fluctuation of the US economy, persist, it may cause Thailand’s economy to weaken. This can be seen from the decreased exports as a result of the weakened world economy, which will in turn impact income per capita and lessen purchasing power, and finally affecting the Company’s revenue. As Bangkok Hospital and some of the network hospitals, namely, Samitivej Hospital, Bangkok Hospital Pattaya and Bangkok Hospital Phuket, provide treatment of complex diseases by tertiary care experts, which have higher costs, the Company may be more affected than other private hospitals in times of economic slowdown.
2. Risk of private hospital business and operations
2.1 Risk from future changes in standards or regulations governing the Company The Company operates under the supervision of the Ministry of Public Health and other related government agencies. Furthermore, the Company must have a license to operate a health care business and health clinics as stipulated by the law governing health clinics. In addition, the Company must comply with laws governing health clinics, companies and other related laws. Any changes in the interpretation of current regulations or enforcement of laws or new regulations or policies that are likely to be stricter, may impact the Company’s operations. The enforcement of laws or new regulations, as well as the deliberation of the draft Patient Protection Act, which protects persons who have been wronged or received damages from health care services with the goal to compensate the patients in a timely manner without having to prove wrongdoing, may affect health care providers including the Company. There is also consideration of setting up a patient protection fund to pay for damages to patients, whereby the health care clinics (including the Company) are responsible for contributing to the fund according to the rules, procedures and rate determined by the Patient Protection Committee. Therefore, the Company may not be able to guarantee that future changes to laws and regulations or issuance of new regulations or new policies related to the Company’s business will not affect the Company’s operations and business opportunities.
2.3 Risk in losing medical personnel or crucial executives The private hospital business must depend on skilled medical personnel such as physicians, nurses, pharmacists and technicians. Therefore, losing medical personnel or crucial executives, and not being able to replace them with comparable personnel may have negative effects on the Company. Presently, the hospital business in Thailand is faced with the problem of lack of medical personnel. Great reliance is placed upon the public sector to develop medical personnel and there have not been sufficient medical personnel to meet demand. The Company has had to compete with other hospital operators in retaining and attracting skilled medical personnel, which will affect the Company’s costs. However, the Bangkok Hospital network is a large one and has continued to provide financial support for education and research to medical personnel in order to improve specialized skills. We are a knowledge organization that aims to enhance medical knowledge in all areas as well as state-of-the-art medical technology. Moreover, the Company has set measures in determining compensation that is fair when compared to other operators in the private hospital business. Therefore, the Company currently has not been significantly affected by this risk. 2.4 Risk of lawsuits Presently, people are more aware of patients’ rights, especially with the issuance of the Act on Court Proceedings for Consumer Cases B.E. 2551 (2008), which more easily enables consumers and patients to file suit against health care service providers. This law may affect health care service providers and medical personnel, which puts the Company at risk of being sued for medical services provided. Nevertheless, management recognizes the importance of controlling and inspecting quality of medical services, the screening of physicians, as well as patients’ rights. The Company gives importance to providing information, managing patients’ expectations, reporting procedures and finding solutions when a complaint is received, as well as improving quality and determining indicators that ensure that the quality of service always meets international standards.
49 Annual Report 2012
2.2 Risk from competition The private hospital business is highly competitive and is likely to be even more competitive in the future. Apart from competition with hospitals at the same level, the Company must also compete with mid level private hospitals, which have improved and developed medical services, as well as acquired state-of-the-art medical equipment in order to expand their customer base. Public hospitals have also expanded medical services offered such as opening after-hours clinics, and private hospitals managed by large public hospitals, which may take away some of our patients. Thus, the Company will have greater competition from these hospitals. Furthermore, in recent years, private hospitals and public hospitals have increased their investments to improve efficiency of service and their competitive edge. This is expected to continue in the near to medium term and may have some effects on the Company. Therefore, in order to maintain competitive edge and to differentiate services provided, the Company has made substantial investments in state-of-the-art technology and medical equipment, as well as investment in information technology to support expedition of medical services. Expanding the hospital network and improving the efficiency in patient transfer as well as expansion into more provinces with help support the Company’s medical services, which will also affect the Company’s operating costs.
Risk Factors
However, the Company and hospitals within the networks are in compliance with various standards of quality such as JCI (Joint Commission International) and HA (Hospital Accreditation). Compliance with HA requires that a Committee be established to monitor the quality of patient care and ensure that it meets the standards of safety and environmental conservation, as well as monitor the various risks, especially risk in providing medical care. This may help to lessen the effects of changes to laws regarding health and the environment.
Risk Factors
2.5 Risk of reliance on foreign patients Medical services revenue from foreign patients, which includes persons living or working in Thailand, or persons travelling to Thailand for pleasure or specifically to receive medical care, as well as staff of foreign governments or agencies, or employees of foreign companies, is an important part of the Company’s revenue from medical services. The revenue from foreign patients equaled Baht 9,863 million in 2011 and Baht 12,267 million in 2012 or 26% and 28% of the Company’s revenue in 2011 and 2012, respectively. This group of patrons chooses the Company’s services because of the high standard and quality of medical services, lower medical costs when compared with other countries, the tourism industry and political stability. As the revenue from foreign patients is high, there is fierce competition in providing services to this group of patients among private hospital operators.
Annual Report 2012
50
If there is a situation that affects the decision to receive medical services in Thailand, such as the political situation in Thailand, other factors affecting the tourism industry, the significant appreciation of the Thai Baht against other currencies, the negative image of Thailand in the eyes of foreigners, increased competition from other countries in medical tourism, foreign patients may not come to Thailand for medical services and this may affect the Company’s business opportunities. However, the Company has expanded the network to cover more areas in Bangkok and the various regions in the country in order to expand the domestic client base and lower the dependence on foreign clients. In addition, the Company has expanded the foreign client base to cover additional countries to decrease dependence on any particular group of foreign patients. 2.6 Risk from foreign investments The Company has made investments (capital, loans to subsidiaries and guarantee loans of subsidiaries with external parties) as of 31 December 2012 in the amount of USD 47.5 million or approximately Baht 1,444 million or 2.1% of the Company’s total assets. The Company’s foreign investments, including shares held in Angkor Pisith Co., Ltd., which manages the Royal Angkor International Hospital, and shares held in Rattanak Medical Services Co., Ltd., which manages Royal Rattanak Hospital, equal to 80.0% and 70.0%, respectively, and 100% investment in Phnom Penh Medical Services Co., Ltd. and BDMS International Medical Services Co., Ltd., which has not yet started operations. There are factors that may negatively affect the Company’s foreign investments, such as the laws, regulations or policies of the governments of the foreign countries which govern the Company’s business or the political situation and economy of the country, foreign currency exchange volatility or cost of investments or operations that are higher than estimated. These factors may prevent the Company from receiving the return as expected and may affect the financial status and operations of the Company.
3. Financial Risks
3.1 Risk in receiving payment of medical fees Receiving payment is one of the financial risks that the Company faces, that is, when providing medical care before charging fees and expenses, there is a risk that we may not be able to receive payment for such services. However, the Company has the following policies in reducing such risk: 1. When providing services to patients who are personally responsible for the expense, in the case of non-emergency procedures, the Company has the policy to assess the expense before providing medical services so that the patient will be aware of the budget and make payment prior to treatment. 2. The Company also has the policy to notify the party responsible for the payment of medical expenses of the expenses incurred during the course of treatment and encourages payment along the way to lessen the burden of one-time payment at the end of treatment.
3. For payment by counter parties, the Company also has a policy to provide credit for payment of medical services with caution by analyzing the counter party’s credit history and financial status, as well as regularly reviewing the relationship to lessen the risk of non-payment. The Company has set up the Debtor Management Committee comprised of management from finance and operations. The Committee meets regularly to review and determine measures to manage the risk, as well as find appropriate solutions for the Company and patients when there is default of payment.
Furthermore, the volatility of foreign currency against the Thai Baht, which is a determining factor in setting competitive pricing compared to health care providers in other countries, is another factor that may affect the Company’s revenue. In 2012, the Thai Baht appreciated compared to the US dollar, between Baht 30.3 to Baht 31.9 to the dollar. The Company thus faces risk from the volatility of foreign currency exchange, which is an external factor that is out of the Company’s control. In this case, the Company has tried to maintain a suitable ratio of domestic and foreign patients in order to reduce this risk.
51 Annual Report 2012
3.3 Effects of global economy and foreign currency exchange volatility Part of the Company’s revenue comes from services provided to foreigners who travel to Thailand. Therefore, the economic status of the country of origin of the foreign patients has an impact on the number of foreigners who visit hospitals within the Company’s network in the same way that the domestic economy impacts the number of local patients. Thus, The Company’s business, financial status, profits and business opportunities may be impacted by the economy of the various countries of origin of the foreign patients.
Risk Factors
3.2 Risk from interest rate volatility As of 31st December 2012, the Company has financial liabilities at the floating rate in the amount of Baht 8,158 million from a total of Baht 19,910 million or 41.0% of total financial liabilities. Therefore, the volatility of interest rates may have some impact on the cost of capital. However, as the Company has the policy to manage interest rate risk, which includes entering into interest rate swaps according to the market situation.
Shareholding Structure and Management
Shareholding Structure and Management
Annual Report 2012
52
1. Shareholding Structure
The top ten major shareholders of the Company on the closing of the shareholders register on 29 March 2012 are as follows: Name 1 2 3 4 5 6 7 8 9 10
Mr. Prasert Prasarttong-Osoth, M.D. and spouse Mr. Wichai Thongtang and spouse Mr. Satit Viddyakorn and spouse Bangkok Airways Company Limited and Bangkok Airways Holding Company Limited The Viriyah Insurance Public Company Limited Miss. Poramaphorn Prasarttong-Osoth, M.D. DEUTSCHE BANK AG SINGAPORE (DCS) A/C CLIENT Mr. Chirotchana Sucharto, M.D. and spouse CREDIT SUISSE AG, SINGAPORE BRANCH Mr. Chuladej Yossundharakul, M.D. and spouse
Total
Total Shares
% of total shares outstanding
196,704,984 184,998,269 122,681,981 121,938,769 99,544,463 49,662,607 44,694,900 39,408,009 31,337,598 27,565,795 918,537,375
12.73% 11.97% 7.94% 7.89% 6.44% 3.21% 2.89% 2.55% 2.03% 1.78% 59.43%
Source : The Thailand Securities Depository Company Limited (TSD)
As of 17th October 2012, the Company was informed of the acquisition and sale of securities of BGH by shareholders numbers 1, 3 and 4 and the Company informed the Stock Exchange of Thailand of the change in shareholding structure. After said acquisition and sale, the three shareholders aforementioned held BGH as follows: - Shareholder number 1 295,372,734 shares equal to 19.1 294,281 shares equal to 0.02 - Shareholder number 3 - Shareholder number 4 130,580,194 shares equal to 8.4
2. Management
2.1 Personnel As of 31 December 2012, the Company had 3,237 employees and 1,022 physicians, details as follows: Type
Staff Physicians and Employees
Consulting Physicians and Part-time Employees
Total
Nurses Employees Total employees Physicians
926 1,817 2,743 379
161 333 494 643
1,087 2,150 3,237 1,022
Note : Staff Physicians refer to physicians who work 40 hours or more a week for the Company but are not considered employees of the Company.
2.2 Management Structure As of 31st December 2012, the management structure of the Company is comprised of the Board of Directors, the Audit Committee, the Nomination and Remuneration Committee, the Executive Committee and the top four executive ofďŹ cers, details as follows:
Shareholding Structure and Management 53 Annual Report 2012
Board of Directors 1. Prof. (Emeritus) Arun Paisawasdi, M.D. Chairman/Independent Director 2. Mr. Chuladej Yossundharakul, M.D. 1st Vice Chairman 3. Mr. Wichai Thongtang 2nd Vice Chairman 4. Mr. Prasert Prasarttong-Osoth, M.D. CEO & President 5. Mr. Pongsak Viddyakorn, M.D. Director 6. Mr. Chirotchana Sucharto, M.D. Director 7. Mr. Pradit Theekakul Director 8. Prof. (Emeritus) Santasiri Sornmani, M.D. Independent Director 9. Mr. Thavatvong Thanasumitra Director 10. Mr. Chatree Duangnet, M.D. Director 11. Mr. Chawalit Setthmethikul Independent Director 12. Dr. Somchai Sujjapongse Independent Director 13. Mr. Sripop Sarasas Independent Director 14. Miss. Kananuj Lekvichit Director 15. Mr.Thongchai Jira-alongkorn Director Authorized Directors Two directors out of the following five may sign jointly and affix the company seal: Mr. Prasert Prasarttong-Osoth, M.D., Mr. Pongsak Viddyakorn, M.D., Mr. Chuladej Yossundharakul, M.D., Mr. Chirotchana Suchartp, M.D. and Mr. Chatree Duangnet, M.D. Company Secretary The Board of Directors has appointed Ms. Kessara Wongsekate, Assistant Vice President, as the Company Secretary to act in accordance with the law with regards to securities and securities exchange and notifications of the Capital Market Supervisory Board. Furthermore, the Company Secretary shall fulfill her duties as assigned by the Board of Directors as well as coordinate and monitor to ensure compliance with the resolutions of the Board of Directors’ and the Shareholders’ Meetings for success and good corporate governance. Duties and Responsibilities of the Board of Directors 1. Perform duties using their knowledge and expertise for the benefit of the Company in accordance with the regulations of the Company and resolutions of the shareholders’ meeting. Directors are authorized to perform actions indicated in the Articles of Association, the Public Company Act and relevant laws. 2. Comply with the provisions and the good practices of listed company directors of the Stock Exchange of Thailand. 3. Determine policies and ensure that management acts in accordance with those policies, as well as approve business plans, annual budgets, investments, and make financial decisions. 4. Monitor the operational results of management and the Company in order to ensure consistency with established goals and plans. 5. Set efficient internal control and audit systems for the purpose of auditing, operational oversight and liaise with the Audit Committee. 6. Protect the interests of the shareholders and practice standardized and transparent disclosure of information. 7. Report conflicts of interest of oneself, spouse and related persons as prescribed in the Securities and Exchange Act, as well as report securities held of oneself, spouse and children (not yet of legal age) to the Company Secretary for further reporting of any changes at the Board of Directors’ meetings. Audit Committee The Board of Directors meeting 6/2011 on 26th June 2011 resolved to appoint the Audit Committee, which is to be comprised of three independent directors with a term of three years. The members of the Audit Committee are as follows: 1. Prof. (Emeritus) Santasiri Sornmani Chairman of the Audit Committee 2. Dr. Somchai Sujjapongse Committee Member 3. Mr. Sripop Sarasas Committee Member
Shareholding Structure and Management Annual Report 2012
54
Qualifications of the Audit Committee 1. The Audit Committee member must be an Independent Director and appointed by the shareholders’ meeting or the meeting of the Board of Directors. Independent Directors must have the following qualifications according to the Securities and Exchange Commission: 1.1 Holds less than 1.0 percent of the voting shares of the Company, its subsidiaries, associates or affiliates. This includes shares held by related persons of the individual independent directors. (Related persons meaning children as defined in Article 258 of the Securities and Exchange Act.) 1.2 Is not/Has not been an executive director, staff, employee, salaried advisor or person with controlling power of the Company, parent company, subsidiaries, associated companies, same level subsidiaries, major shareholders or persons with controlling power, unless that status has ended for no less than 2 years prior to the appointment. This restriction shall not apply to an independent director who has been a civil servant or an advisor to a government authority that is a major shareholder or controlling person of the Company. (Same level subsidiaries meaning subsidiary with the same parent company.) 1.3 Is not a blood relative of or has a legally registered relationship as father, mother, spouse, sibling and child, as well as spouse of child, with management, major shareholders with controlling power or individuals to be proposed as management or those having controlling power over the company or subsidiaries. 1.4 Does not have/Has not had business relationship with the Company, parent company, subsidiaries, associated companies, major shareholders or persons with controlling power, in a way that may hinder one’s independent judgment. In addition, the individual must not be/have been a substantial shareholder or a person with controlling power of an entity that has a business relationship with the Company, parent company, subsidiaries, associated companies, major shareholders or persons with controlling power, unless that status has ended for no less than 2 years prior to the appointment. 1.5 Is not/Has not been an auditor of the Company, parent company, subsidiaries, associated companies, major shareholders or persons with controlling power of the Company and is not a substantial shareholder, a person with controlling power or partner of an audit firm which employs auditors of the Company, parent company, subsidiaries, associated companies, major shareholders or persons with controlling power, unless that status has ended for no less than 2 years prior to the appointment. 1.6 Is not/has not been a professional advisor, which includes legal counsel and financial advisor, who receives an annual service fee exceeding Baht 2 million from the Company, parent company, subsidiaries, associated companies, major shareholders or persons with controlling power and is not a substantial shareholder, a person with controlling power or partner of the professional advisor, unless that status has ended for no less than 2 years prior to the appointment. 1.7 Is not a director who has been appointed as a representative of the Company’s directors, major shareholders or a shareholder who is a related person to a major shareholder. 1.8 Not conducting any business which is of the same nature as or in material competition with that of the Company or its subsidiaries, nor be a substantial partner, executive director, staff, employee, salaried advisor, or hold more than 1% of total shares with voting rights of any company whose business is of the same nature as or in material competition with that of the Company or its subsidiaries. 1.9 Not posses any other characteristics which may render that person incapable of expressing independent opinions with regards to the Company’s operations. Independent Directors may be assigned by the board of Directors to make decisions regarding operations of the Company, subsidiaries, associated companies, same level subsidiaries or juristic persons that pose a conflict of interest through a collective decision. 2. Apart from the qualifications of the Independent Director, the Audit Committee member must also have the following qualifications: 2.1 Not a Director that has been assigned by the Board of Directors to make decisions on operations of the Company, the parent company, subsidiaries, associated companies, same level subsidiaries or other juristic persons that pose conflict of interest.
Shareholding Structure and Management 55 Annual Report 2012
2.2 Have knowledge, experience and can dedicate sufficient time to take on duties as assigned. 3. Is not a member of the Audit Committee of a listed company that is in the same business or industry as the Company or be a member of the Audit Committee of more than five other listed companies as he/she may not be able to fulfill duties at any one company to the fullest. The following are considered to not have an impact on the duties and independent opinions of the Audit Committee: 1. Transactions between an Audit Committee member or persons connected to an Audit Committee member and the company, subsidiaries, associated companies or major shareholders involving acquisition and sale of goods or services under the following conditions: 1.) Acquisition or sale of goods or services in normal course of business with general trade terms that are clearly stated and disclosed. 2.) Price of goods or services are comparable to those offered to other customers. 2. Connected transactions that follow the related regulations of the Stock exchange of Thailand. 3. Other transactions within the law, rules regulations or notifications of the Stock exchange of Thailand according to the duties of the Audit Committee to ensure correctness of financial reports, efficiency of internal controls and compliance with laws, regulations and ethics to support good corporate giovernance. Duties and Responsibilities of the Audit Committee In order that the Audit Committee may perform the duties as assigned by the Board of Directors, the Audit Committee shall have the following duties and responsibilities: 1) Ensure that the Company is in compliance with laws on securities and exchange, regulations of the Stock Exchange of Thailand, and laws related to the business. 2) Ensure the correct, complete and reliable issuance of reports and disclosure of information in the financial reports of the Company by liaising with external auditors and executives responsible for the preparation of financial reports to ensure that the reports are completed within the time frame prescribed by the Stock Exchange of Thailand, laws and government agencies. 3) Nominate auditor and annual auditing fee for consideration of the Board of Directors for the approval of the shareholders’ meeting. 4) Ensure that there is an independent investigation and monitoring process so that employees can report inappropriate items in the financial statements or other matters. 5) Ensure the use of proper and efficient internal control and internal audit measures by engaging in the joint revision with independent external auditors and internal auditors. The Audit Committee should consider the independence of the internal audit department. 6) Review internal investigation evidence in the case that there is suspicion of fraud or abnormality or significant defect of internal control measures for presentation to the Board of Directors for further consideration. 7) Instruct and review evidence in the case where there is suspicion of violation of law or any regulations of the Stock Exchange of Thailand, which may significantly affect the financial status and operational results of the listed company. 8) Hire or bring in specialists to assist in auditing and investigating according to the Company’s guidelines in the case that the Audit Committee finds or suspects that there is a transaction or action that may significantly impact the financial status and operating results of the Company. In such case, the Company shall bear the costs of hiring specialists. 9) In the case that the Company has its own internal audit department, the Audit Committee has the authority to approve the appointment, transfer and termination, as well as evaluate the performance of the head of the internal audit department. However, in the case that the Company hires an external party to conduct the internal audit, the Audit Committee has the power to approve the hiring as well as the fee to be paid to the external party. 10) Ensure that the Company has suitable risk management and control system encompassing the entire organization, as well as suggest ways to suitably and efficiently manage risks that arise in the business.
Shareholding Structure and Management Annual Report 2012
56
11) Review the risk management reports and monitor the important risks as well as report to the Board on the Committee’s view on the sufficiency of the risk management system and risk control. 12) Ensure that there are no conflicts of interest by reviewing transactions between the Company or subsidiaries and related persons to ascertain that the transactions are within the law and regulations of the Stock Exchange of Thailand. 13) Prepare the Audit Committee Report and disclose the report in the Company’s annual report. The report should include details as prescribed in the notifications of the Stock Exchange of Thailand and related regulations. 14) Review the charter of the Audit Committee annually. The charter should include details of the responsibilities of the Audit Committee as prescribed in the regulations of the Stock Exchange of Thailand on responsibilities of the Audit Committee at a minimum. In addition, the charter should sufficiently support the duties of the Audit Committee such as the hiring of specialists to provide opinion on matters that require expertise. In the case that the Committee deems that it is necessary to amend the charter in compliance with the changing of rules, regulations and circumstances, the Audit Committee shall propose such amendments to the Board of Directors for approval. 15) Complete other tasks as assigned by the Board of Directors Nomination and Remuneration Committee The Board of Directors meeting 2/2012 on 29th February 2012 resolved to appoint the Nomination and Remuneration Committee, which is to be comprised of independent directors with a term of three years. The members of the Nomination and Remuneration Committee are as follows: 1. Prof. (Emeritus) Santasiri Sornmani Chairman of the Committee 2. Mr. Chuladej Yossundharakul Committee Member 3. Mr. Chawalit Setthmethikul Committee Member 4. Dr. Somchai Sujjapongse Committee Member 5. Mr. Sripop Sarasas Committee Member Duties and Responsibilities of the Nomination and Remuneration Committee 1) Determine suitable qualifications of Directors, ways to recruit and guidelines in selecting qualified candidates who should be nominated as Director to the Board of Directors for consideration in proposing to the general shareholders’ meeting for approval. 2) Determine mode of remuneration, guidelines for remuneration and remuneration of Directors and sub-committee members that are precise, transparent, just and corresponding to the responsibilities and performance so that it will motivate quality directors to remain with the Company. The remuneration structure, guidelines and rates shall be proposed to the Board of Directors for consideration before proposing to the general shareholders’ meeting for approval. 3) Determine suitable qualifications, ways to recruit and guidelines in selecting the Chief Executive Officer and President as well as selecting the most qualified candidate for approval by the Board of Directors. 4) Determine mode of compensation and guidelines for remuneration of the Chief Executive Officer and President that are precise, transparent, just and corresponding to the responsibilities and performance. The remuneration structure, guidelines and rates shall be proposed to the Board of Directors for approval. 5) Prepare guidelines and procedure in evaluating the performance of the Chief Executive Officer and President for approval by the Board of Directors. 6) Evaluate the performance of the Chief Executive Officer and President according to the guidelines approved by the Board of Directors and determine the annual remuneration based on the results of the evaluation for further approval by the Board of Directors. 7) Prepare a succession plan for the position of Chief Executive Officer and President for approval by the Board of Directors. 8) Review the charter of the Nomination and Remuneration Committee annually. In the case that the Committee deems that it is necessary to amend the charter in compliance with the changing of rules, regulations and circumstances, the Nomination and Remuneration Committee shall propose such amendments to the Board of Directors for approval. 9) Complete other tasks as assigned by the Board of Directors.
Shareholding Structure and Management 57 Annual Report 2012
Executive Committee The Board of Directors meeting 5/2012 on 30th May 2012 resolved to appoint the Executive Committee as follows: 1. Mr. Prasert Prasarttong-Osith, M.D. Chairman of the Executive Committee 2. Mr. Chuladej Yossindharakul, M.D. Vice Chairman 3. Mr. Chatree Duangnet, M.D. Committee Member 4. Mr. Pradit Theekakul Committee Member 5. Mr.Thongchai Jira-alongkorn Committee Member Duties and Responsibilities of the Executive Committee 1) Determine the vision, policies and strategies of the Company for further approval by the Board of Directors. 2) Consider business plans, annual budgets, investment plans and corporate social responsibility plans (CSR) of the Company so that they are in line with the policies and strategies set and propose to the Board of Directors for approval. 3) Supervise operations of the Company and ensure compliance with plans set as well as with laws and regulations of the relevant agencies and the articles of the Company. 4) Consider the summary report on operations of the Company and present to the Board of Directors each quarter. 5) Approve expenditures for investments and operating costs within the authority granted by the Board of Directors. 6) Approve or review the loan limit to subsidiaries within the authority granted by the Board of Directors. 7) Ensure that the Company has precise and appropriate internal control systems and risk management systems according to the suggestions and comments of the Audit Committee. 8) Consider and review the organization structure and duties and responsibilities of top level before proposing to the Board of Directors for approval. 9) Approve the succession plan from the position of Hospital Director or a comparable position to the position of Chief Officers or comparable positions. 10) Approve the appointment, transfer or termination of management within the authority granted by the Board of Directors. The Committee shall also approve the Directors and President/Managing Director of subsidiaries so that the subsidiaries may process the approval of such appointments as prescribed by law or applicable regulations and articles of each company. 11) Screen and review the pay scale and annual pay raise of the Company and subsidiaries (excluding Chief executive Officer and President) for further approval by the Board of Directors. 12) Have the authority to appoint working teams to address and solve problems to ensure compliance with Company policies. 13) Review the charter of the Executive Committee annually. In the case that the Committee deems that it is necessary to amend the charter in compliance with the changing of rules, regulations and circumstances, the Executive Committee shall propose such amendments to the Board of Directors for approval. 14) Other duties as assigned by the Board of Directors The above authority and duties shall not include an item that will cause the executive officers or persons with possible conflict to have a stake or conflict of interest in any form with the Company or subsidiaries. Furthermore, it does not include connected transactions and acquisition/sale of important assets of the listed company in accordance with the regulations of the Stock Exchange of Thailand or other related notifications. The Company must act in accordance with regulations and guidelines of the Stock Exchange of Thailand or other related notifications on the related matter. Moreover, the abovementioned authority does not include other matters that must be approved at the shareholders’ meeting as prescribed by the article of the Company.
Shareholding Structure and Management Annual Report 2012
58
Top 4 Executive Officers Name 1. Mr. Prasert Prasarttong-Osoth, M.D. 2. Mr. Chatree Duangnet, M.D. 3. Mrs. Narumol Noi-Am 4. Mr. Trin Charumilind, M.D.
Title President & CEO/Chief Operations Officer - Administrative Affairs Chief Operation Officer - Medical Affairs Chief Financial Officer Chief of Doctor
Role and Responsible for Company’s Managements 1. Manage the Company in accordance with the policies, plans, goals, regulations and good corporate governance as prescribed by the Company, as well as in strict compliance with related laws and regulations. 2. Manage the Company in accordance with the resolution of the shareholders’ meetings, resolutions of the Board of Directors’ meetings and resolutions of the Executive Committee meetings (as the case may be) within the duties, responsibilities and power of approval with honesty, care and with the best interests of the Company in mind for the greater good of the organization and the shareholders, as well as fair consideration of stakeholders. 3. Regularly report performance and progress of the Company at the Board of Directors’ meetings to ensure that the Company is operating in accordance with the determined goals and plans. 4. Report conflicts of interest of oneself, spouse and related persons as prescribed in the Securities and Exchange Act, as well as report securities holdings of oneself, spouse and children (not yet of legal age) to the Company Secretary for further reporting of any changes to the Board of Directors. 5. Consider matters to be proposed to the Executive Committee and/or Board of Directors (as the case may be), as well as consider ways to solve any problems that arise. 6. Other duties as assigned from time to time by the Executive Committee and/or the Board of Directors (as the case may be). The above authority and duties shall not include an item that will cause the executive officers or persons with possible conflict to have a stake or conflict of interest in any form with the Company or subsidiaries. Furthermore, it does not include connected transactions and acquisition/sale of important assets of the listed company in accordance with the regulations of the Stock Exchange of Thailand or other related notifications. The Company must act in accordance with regulations and guidelines of the Stock Exchange of Thailand or other related notifications on the related matter. Moreover, the abovementioned authority does not include other matters that must be approved at the shareholders’ meeting as prescribed by the article of the Company.
3. Selection of Directors
The Nomination and Remuneration Committee has the responsibility of selecting directors to replace those that have completed their terms or must retire for other reasons or new positions. The Committee shall consider and select the qualified persons and present the final candidates to the Board of Directors for approval (in the case of replacing existing directors) or for approval for later appointment by the shareholders. The Nomination and Remuneration Committee shall select qualified persons with knowledge, capability, past experience that is beneficial to the company, leadership skills, vision, and persons who are moral and ethical. In addition, the candidates shall have a transparent and untainted work history, autonomy in making decisions with professionalism and integrity, as well as meet the qualifications as stated in the Company’s Articles of Association and the notifications of the Office of the SEC. The appointment of a Director must be approved by the shareholders’ meeting as per the following guidelines: (1) Each shareholder has number of votes equal to the number of shares held. (2) Each shareholder shall cast all votes available to them under (1) to elect an individual or multiple individuals as director(s). In the event where multiple directors are elected, votes may not be distributed to the various candidates in varying proportions. (3) Candidates with the most votes are to be appointed Directors up to the number open at a given meeting. If more candidates receive equal votes than the number of Directors required, the Chairman of the meeting must cast a deciding vote. The appointment and dismissal of Directors shall be as prescribed in the Articles of Association as follows: 1. The Board of Directors shall be comprised of at least 5 directors and no less than half shall have residence in Thailand.
Shareholding Structure and Management 59 Annual Report 2012
2. Directors shall be individuals with the following qualifications: • A person of juristic age • A person who is not bankrupt, incompetent or quasi-incompetent • A person who has never been sentenced to imprisonment on a charge relating to fraudulent assets • A person who has never been removed from service in the government or government agency due to fraudulent acts. 3. At the annual general shareholders’ meeting, at least one third (1/3) of the Board of Directors shall be retired. If the Board of Directors cannot be divided by three, then the closest number of Directors to one third (1/3) shall be retired. Directors who retire as aforementioned, may be re-elected. 4. Apart from being retired at completion of term, a director may be retired under the following circumstances • Death • Resignation • Disqualification or legally unqualified • The shareholders’ meeting passes a resolution to retire a director, with no less than three quarters of the total number of shares present at the meeting and possess voting rights provided that the total number of shares is no less than half of the total number of shares present at the meeting and possess voting rights • Court ordered 5. Directors wishing to resign shall submit a letter of resignation to the Company to be effective upon receipt of the letter by the Company. 6. In the event that a director position is vacant due to circumstances other than completion of term, the Board of Directors shall elect a qualified individual to fill the position at the next Board of Directors’ meeting, except when the director’s term is less than two months to completion. In this case, the individual serving as replacement shall remain in office for the remainder of the term of the director who has retired. The resolution of the Board of Directors as the above shall only be passed with votes no less than three quarters of the number of directors remaining. 7. In the event that the number of vacant director positions is insufficient for quorum, the remaining directors may act on behalf of the Board of Directors only in organization of the shareholders’ meeting in order to elect directors to the vacant positions. The meeting shall be held within one month from the day that the number of vacant director positions is insufficient for quorum. The individual elected to the vacant director positions shall remain in office for the remainder of the term of the director whom he replaces. The Company has stipulated that at least one third of the Board of Directors shall be independent directors. The selection of independent directors is the same process as the selection of directors. However, the Company has determined additional qualifications for Independent Directors in accordance with the regulations of the Office of the SEC as follows 1.) Holds less than 1.0 percent of the voting shares of the Company, its subsidiaries, associates or affiliates. This includes shares held by related persons of the individual independent directors. (Related persons meaning children as defined in Article 258 of the Securities and Exchange Act.) 2.) Is not/Has not been an executive director, staff, employee, salaried advisor or person with controlling power of the Company, parent company, subsidiaries, associated companies, same level subsidiaries, major shareholders or persons with controlling power, unless that status has ended for no less than 2 years prior to the appointment. This restriction shall not apply to an independent director who has been a civil servant or an advisor to a government authority that is a major shareholder or controlling person of the Company. (Same level subsidiaries meaning subsidiary with the same parent company.) 3.) Is not a blood relative of or has a legally registered relationship as father, mother, spouse, sibling and child, as well as spouse of child, with management, major shareholders with controlling power or individuals to be proposed as management or those having controlling power over the company or subsidiaries. 4.) Does not have/Has not had business relationship with the Company, parent company, subsidiaries, associated companies, major shareholders or persons with controlling power, in a way that may hinder one’s independent judgment. In addition, the individual must not be/have been a substantial shareholder or a person with controlling power of an entity that has a business relationship with the Company, parent company, subsidiaries, associated companies, major shareholders or persons with controlling power, unless that status has ended for no less than 2 years prior to the appointment.
Shareholding Structure and Management Annual Report 2012
60
5.) Is not/Has not been an auditor of the Company, parent company, subsidiaries, associated companies, major shareholders or persons with controlling power of the Company and is not a substantial shareholder, a person with controlling power or partner of an audit firm which employs auditors of the Company, parent company, subsidiaries, associated companies, major shareholders or persons with controlling power, unless that status has ended for no less than 2 years prior to the appointment. 6.) Is not/has not been a professional advisor, which includes legal counsel and financial advisor, who receives an annual service fee exceeding Baht 2 million from the Company, parent company, subsidiaries, associated companies, major shareholders or persons with controlling power and is not a substantial shareholder, a person with controlling power or partner of the professional advisor, unless that status has ended for no less than 2 years prior to the appointment. 7.) Is not a director who has been appointed as a representative of the Company’s directors, major shareholders or a shareholder who is a related person to a major shareholder. 8.) Not conducting any business which is of the same nature as or in material competition with that of the Company or its subsidiaries, nor be a substantial partner, executive director, staff, employee, salaried advisor, or hold more than 1% of total shares with voting rights of any company whose business is of the same nature as or in material competition with that of the Company or its subsidiaries. 9.) Not posses any other characteristics which may render that person incapable of expressing independent opinions with regards to the Company’s operations. Independent Directors may be assigned by the board of Directors to make decisions regarding operations of the Company, subsidiaries, associated companies, same level subsidiaries or juristic persons that pose a conflict of interest through a collective decision.
4. Remuneration of Executive Management
4.1 Monetary Remuneration Annual Remuneration to Directors for year ending 31st December 2012 Director’s Name 1. Prof. (Emeritus) Arun Pausawasdi, M.D. 2. Mr. Chuladej Yossundharakul, M.D. 3. Mr. Wichai Thongtang 4. Mr. Prasert Prasarttong-Osoth, M.D. 5. Mr. Pongsak Viddyakorn, M.D. 6. Mr. Chirotchana Sucharto, M.D. 7. Mr. Pradit Theekakul 8. Prof. (Emeritus) Santasiri Sornmani, M.D. 9. Mr. Thavatvong Thanasumitra 10. Mr. Chatree Duangnet, M.D. 11. Mr. Chawalit Setthmethikul 12. Dr. Somchai Sujjapongse 13. Mr. Sripop Sarasas 14. Miss. Kananuj Lekvichit 15. Mr.Thongchai Jira-alongkorn (1) Total remuneration
(Unit : Baht)
Title
Attendance at meetings
Director’s Allowance
Meeting Allowance
Chairman 1st Vice Chairman 2nd Vice Chairman President Director Director Director Independent Director Director Director Independent Director Independent Director Independent Director Director Director
15/16 16/16 15/16 16/16 15/16 16/16 16/16 16/16 14/16 16/16 15/16 9/16 16/16 16/16 10/10
2,322,400 1,548,400 1,548,400 1,548,400 1,548,400 1,548,400 1,548,400 1,548,400 1,548,400 1,548,400 1,548,400 1,548,400 1,548,400 1,548,400 22,451,600
800,000 550,000 525,000 550,000 510,000 550,000 550,000 550,000 470,000 550,000 510,000 300,000 550,000 550,000 400,000
Note : (1) Mr.Thongchai Jira-alongkorn was appointed as Director by the resolution of the Annual Shareholders’ Meeting in 2012 on 20th April 2012 and first attended Board meetings at Meeting 4/2012 onwards.
Audit Commitee
Attendance at meetings 8/8 3/8 8/8
1. Prof. (Emeritus) Santasiri Sornmani, M.D. 2. Dr. Somchai Sujjapongse 3. Mr. Sripop Sarasas Total remuneration
Meeting Allowance 360,000 120,000 260,000 740,000 (Unit : Baht)
Nomination and Remuneration Committee
Attendance at meetings 2/2 2/2 2/2 1/2 2/2
1. Prof. (Emeritus) Santasiri Sornmani, M.D. 2. Mr. Chuladej Yossundharakul, M.D. 3. Mr. Chavalit Setmeteeul 4. Dr. Somchai Sujjapongse 5. Mr. Sripop Sarasas Total remuneration
Meeting Allowance 60,000 50,000 50,000 25,000 50,000 235,000
Remuneration of Executive Officers ending 31st December 2012 In 2012, the first four (4) Executive Officers together received remuneration in the form of salary and bonus in the amount of Baht 81.0 million. In addition, the Company made contributions to the provident fund for those executive officers, which is a benefit that all employees receive, in the amount of Baht 1.6 million. 4.2 Other Remuneration • Directors and Sub-Committee Members Apart from compensation in the form of meeting allowances and annual allowances as approved by the shareholders, as the Company provides medical services, the Directors receive medical benefits according to company policy, the same as with employees of the Company. • Executive Officers Apart from compensation in the form of company car and mobile phone, executive officers also receive medical benefits according to company policy, the same as with employees of the Company.
5. Dividend Payment Policy
The Company has prescribed a material dividend payment policy since the Annual Shareholders’ Meeting in 2009. The Company’s policy is to pay dividends at no less than 50% of the company profits, depending on business expansion and capital requirements of the Company in each year, as approved by the shareholders, except for dividends within accounting periods which may be approved by the Board of Directors if the Board deems that the Company has had good operating results and sufficient liquidity. During 2007 – 2011, the Company paid out dividends as follows: Dividend Payment Date 4 May 2012 12 January 2011 19 April 2010 30 April 2009 25 April 2008
Dividend Payment Rate (Baht per share) 1.10 0.80(1) 0.70 0.60 0.50
Dividend Payment Period January 2011 - December 2011 January 2010 - December 2010 January 2009 - December 2009 January 2008 - December 2008 January 2007 - December 2007
(1) The Company announced interim dividends for 2011 and the Annual Shareholders’ Meeting in 2011 resolved not to pay additional dividends.
Shareholding Structure and Management
(Unit : Baht)
61 Annual Report 2012
Remuneration of Sub-Committees
Good Corporate Governance
Good Corporate Governance
Annual Report 2012
62
The Company recognizes its role, duty and responsibility in practicing good corporate governance and believes that corporate governance determines the structure of the relationships among the shareholders, the Board of Directors, management and all stakeholders. The aim of good corporate governance is to increase competitive edge and value for shareholders in the long term, as well as the benefits of the other stakeholders, which will ensure the Company’s continuous and sustainable growth. The Board of Directors plays many significant roles; one of those roles is to ensure good corporate governance as assigned to the President and management, which will comply with approved corporate governance policies. The Company’s good corporate governance policies are in compliance with the guidelines set by the Stock Exchange of Thailand. The Company monitors the new regulations that have been put into practice and adjusts the Company’s practices to comply with such regulations, which is supported by the Board of Directors and management to encourage practice and set examples.
1. Corporate Governance Policy
The Board of Directors is responsible to every shareholder and endeavors to understand the needs of shareholders, as well as assess economic, social, environmental and ethical factors which may significantly impact the interests of shareholders. Each Director must possess honesty, determination, as well as independence of thought and decision making. In addition, the Board of Directors must also be aware of the interests of the other stakeholders. The corporate governance policy recognizes the special role that the Board of Directors plays in connecting the shareholders with the President, as well as management. Furthermore, the policy clearly covers the dual role of the President and other Directors who are both members of the Board and members of executive management. Since 2008, the Board of Directors has reviewed and revised the current corporate governance policy and made many changes to meet international standards. The Board of Directors has emphasized good corporate governance through integration of policy and business direction, sufficient internal controls and auditing, as well as ensuring that management act efficiently under the established policies so as to ascertain that the Company is transparent, ethical and abides by the governing laws and regulations. The Board of Directors has entrusted the Audit Committee to draft the internal audit scheme to ensure that the organization complies with all policies, including the regular monitoring, review and revision of policies. This is to assure that the Company’s corporate governance policy is up-to-date and suits the present situation. The Corporate Governance Policy covers the following topics: 1. Rights and equal treatment of shareholders and the shareholders’ meeting 2. Policy on stakeholders’ interests 3. Disclosure and transparency 4. Responsibility of the Board of Directors and sub-committees 5. Business ethics
2. Rights and Equality of Shareholders
2.1 Rights and Equality The Company is responsible to shareholders in disclosure of information, preparation of financial statements, utilization of insider information and resolution of conflicts of interest. Management must possess ethics and any decisions made must be made with honesty and integrity, as well as be fair to major and minor shareholders for the good of the whole. The Company is aware of its responsibility in assigning importance to rights without bias and with equal treatment of all shareholders. It is the Company’s duty to protect the rights and interests of the shareholders, including the right to dividend payments and the right to receive relevant information regularly and in a timely fashion. Moreover, the Company has the duty to disclose information with transparency and show responsibility of management by holding the shareholders’ meetings.
Good Corporate Governance 63 Annual Report 2012
The Company has the policy to support disclosure of information and business transactions so that the shareholders may better understand the Company’s operations. Major and minor shareholders, institutional investors and foreign investors equally receive information on business operations, management policy and the financial statements of the Company and have the right to be treated fairly. At each shareholder’s meeting, the Company will distribute the letter of invitation in advance to inform the shareholders of the meeting agenda as well as opinion of the Board of Directors on each agenda and other documents so that the shareholders may be well informed when making the decision to vote. In the letter, the Company also informs shareholders of their rights in attending the meetings and their right to vote. In addition, to provide greater convenience, the Company posts the letter of invitation to the shareholders meeting on the Company website. For 2011 annual general meeting, the Company posted the letter of invitation on the website 30 days in advance of the meeting date. The shareholders shall receive proxy forms to allow the shareholders to appoint an authorized representative to attend meetings and vote on their behalf. In addition, to provide another channel in exercising shareholders’ rights, the Company suggests that in the case that the shareholder cannot attend a particular meeting, the shareholder should appoint an independent director as proxy to attend the meeting and vote on the shareholder’s behalf. In appointing such proxy, shareholders may use any one of the proxy forms or the Ower of Attorney form included in the meeting invitation package or download the proxy form from the Company’s website. The Company has a policy to give the shareholders the opportunity to submit questions and to propose agendas for the annual shareholders’ meeting, as well as to nominate qualified and capable persons as Directors to the Board of Directors prior to the meeting. The Company gives opportunity to do so for a period of 45 days and interested shareholders can access information on guidelines and conditions in proposing agendas and nominees on the Company’s website. In the case that the Board of Directors has considered that the proposed agenda is suitable, constructive and beneficial to the Company, the Board of Directors will include such agenda in the meeting proceedings for consideration of the shareholders. However, if the Board of Directors is of the opinion that such agenda is not suitable, the Board of Directors shall report this to the shareholders’ meeting and provide reasons as to why that agenda was not included in the proceedings. In 2012, the Company provided the opportunity for shareholders to propose agendas for the annual general meeting as well as to nominate qualified and capable persons as Directors to the Board of Directors prior to the meeting between 1 December 2012 to 14 January 2013. During the shareholders’ meeting, each shareholder has equal rights to express their opinions and pose questions within the appropriate time frame. The process of voting and counting votes is carried out swiftly with full disclosure. The Company deems that one share equals one vote and the majority vote decides the outcome (for general agendas for which the law does not specify otherwise). If the vote is equal, the Chairman of the meeting shall cast an additional vote, apart from his/her vote as a shareholder, as the deciding vote. Ballots shall be used only in the case that a shareholder objects, abstains or a split vote. The ballots shall be retained for further inspection after the meeting. The results of the voting are recorded in the minutes of the meeting. For each agenda, number of “for”, “against” and “abstain” votes are recorded, as well as the questions raised, explanations and opinions of the meeting so that shareholders may later verify the information. In the case that any shareholder has a special stake in any of the agendas, the shareholder is not allowed to vote on that agenda with the exception of voting for appointment or removal of directors. 2.2 Shareholders’ Meetings The Company’s policy is to convene the shareholders’ meeting as prescribed by law and give shareholders the opportunity to be fully informed before exercising their rights. To this end, the Company has held the annual general shareholders meeting within four months from the end of the accounting year. The meetings are held in compliance with the laws and regulations of the Stock Exchange of Thailand from announcement of the meeting and organization of the meeting to after the meeting.
Good Corporate Governance Annual Report 2012
64
Shareholders with total shares no less than one fifth (1/5) of shares outstanding or shareholders no less than 25 persons whose total shares is no less than one tenth (1/10) of shares outstanding, may petition the Board of Directors to hold an extraordinary meeting of the Company’s shareholders as stated in the company rules and regulations. The petition must clearly state the reason for convening the extraordinary meeting. The Board of Directors must convene the extraordinary shareholders’ meeting within one month from the day the petition is received. Details of the proceedings of shareholders’ meetings are as follows: Prior to Meetings The Company has sent letters of notification by registered mail no less than 10 days in advance for general matters, which is a higher standard than the law requires, and at least 14 days in advance in the case approval is needed for connected transactions or special matters. The notification of the meeting is published in at least one daily Thai language newspaper and in at least one daily English language newspaper for three consecutive days prior to the meeting date. From the annual general shareholders’ meeting in 2007 onwards, the Company has announced the shareholders’ meeting and accompanying documents both in Thai and English on the Company’s website (http://www.bangkokhospital. com) under the menu item “Investor Relations” as an additional mode of dispensing information to ensure shareholder equality. Since 2011, the Company posted the meeting invitation on the Company’s website 30 days prior to the meeting date. The meeting invitation shall include details of the meeting, such as time and place for the meeting, meeting agenda as well as opinions of the Board of Directors on each agenda and accompanying documents (if any), the Company’s annual report, proxy form and a list of accompanying documents of the meeting. Additionally, the Company has delivered details on the meeting proceedings and appointment of proxy, including suggesting that the shareholder appoint an independent director to act as proxy. This is to assist the shareholders in making informed decisions when exercising their rights and voting. For the convenience of the shareholders, the Company provides registration at the meeting using bar codes and has prepared separate ballots for each agenda, especially for the selection of Directors, whereby the Company has prepared ballots for the voting of individual directors. Shareholders and/or proxies shall receive the ballots at the registration stage. During Meetings The Company has assigned the Chairman of the meeting the duty of notifying and explaining the voting procedures in the various agendas before the meeting is officially convened. The President is assigned the task of responding to questions from the shareholders. After each agenda, the results of the vote will be announced and duly recorded. For the convenience of the shareholders and for clarity, the Company uses multimedia facilities in presenting information and voting results after each agenda during the meeting. The Company has the policy to strictly adhere to the meeting agenda and to allow shareholders equal opportunity in casting votes. To honor the rights of all shareholders, the Company has put in place a policy, which requires that all directors, as well as sub-committees, the auditor and executive management such as Chief Financial Officer, Accounting Director and Financial Director (Investor Relations), attend each shareholders’ meeting. If any director or executive cannot attend the shareholders’ meeting, he/she must submit a written explanation of the absence to the Chairman of the Board (in the case of directors) or the President (in the case of executive management). The Chairman of the meeting has provided sufficient opportunity for shareholders to raise questions and advise on business operations, and the annual financial reports without infringing shareholders’ rights. The Chairman of the Board and the President will clarify all information during the meeting and give all directors the opportunity to unofficially meet the shareholders after each meeting.
The Company recognizes the significance of each group of stakeholders, whether they are internal personnel or external stakeholders such as shareholders, customers, creditors, counter-parties, communities, government agencies and other related organizations. The Company also recognizes that the support of each of the stakeholders will ensure the stability and longevity of the organization in the long term. Therefore, the Company has the policy to protect the rights of the stakeholders through compliance with relevant laws and regulations, as well as respecting the interests of all related parties. The policies are as follows: 3.1 Policy on Transactions which may cause Conflict of Interest and Transactions between Companies The Board of Directors understands that transactions which may lead to conflicts of interest and/or transactions with related counter-parties must be thoroughly contemplated to ensure compliance with the relevant laws and regulations of the Securities and Stock Exchange Commission and the Capital Market Committee, as well as the Company’s internal guidelines. Moreover, such transactions must be strictly carried out as with any other transactions with external parties which have no relationship with the Company. Also, the transactions must fully provide value to the Company and the shareholders. The terms and conditions of the transactions must follow the generally accepted standard terms and conditions of business transactions. The Company has the policy to prevent Directors, management and employees from using their status for their own personal gain. Directors, management and employees must refrain from engaging in transactions which have conflict of interest with the Company. Furthermore, any Directors, management or employees who have a stake in any transactions will not be part of the decision making process. Directors, especially, will not be allowed to consider or vote on any matters in which they have an interest, including transactions between companies and transactions between subsidiaries and stakeholders. 3.2 Policy on Insider Information The Board of Directors prohibits the Directors, management and employees from taking advantage of opportunities or information that they receive through their positions for personal gain. Nor are they permitted to use opportunity or information to establish a business that is in competition with or is related to the Company’s business. This includes strictly prohibiting the use of insider information to buy or sell shares and securities of the Company for personal gain as well as providing insider information to other persons or juristic persons to buy or sell shares and securities of the Company. Directors and management must report the trading of the Company’s securities and update their current share holding, as well as holdings of spouse and dependents, each time there is a change, to the Company Secretary every month. The Company Secretary will present the report on the changes in securities holdings at the Board of Directors’ meeting. 3.3 Policy on Shareholders The Company aims to achieve the utmost benefits in the long term for the shareholders through stable growth and sustainable capability in generating profits, including maintaining the competitive edge by recognizing the current and future business risks. The Company emphasizes business for consistent profits through continuous business development. The Company strives on professional management, efficient internal control, systematic audit and strong risk management to reciprocate and show responsibility to our shareholders.
Good Corporate Governance
3. Equality and Rights of Stakeholders Policy
65 Annual Report 2012
After Meetings The Company has prepared the minutes of the meeting as well as recorded the results of the voting. For each agenda, number of “for”, “against” and “abstain” votes are recorded, as well as the questions raised, explanations and opinions of the meeting are detailed in the minutes. The minutes of the shareholders’ meeting are submitted to the Stock Exchange of Thailand within the prescribed 14 days after the meeting. The Company has the policy to announce the minutes of the shareholders’ meeting on the company website (http://www.bangkokhospital.com) under the menu item “Investor Relations”.
Good Corporate Governance Annual Report 2012
66
Other than fundamental rights of the shareholders such as the right to inspect number of shares, right to receive share certificate, right to attend shareholders’ meetings and to vote, right to freely express opinions and make suggestions on the Company operations at the shareholders’ meetings, right to fairly receive returns, and other lawful rights, the Company also has the policy disclose information justly, with transparency and in a timely fashion under business limitations so that every shareholder equally receives information. 3.4 Policy on Employees Employees are a valuable asset to the Company. Capable and experienced employees are consistently well-taken care of in compliance with the Company’s strategy and operational plans. The Company also ensures equal opportunity and suitable compensation. Furthermore, the Company has arranged for the necessary training by both internal and external persons in order to continuously enhance the skills of employees. Moreover, the Company supports and promotes the healthy working environment and organizational culture, and treats employees equally and justly. Employees are given the opportunity to express their opinions and make suggestions to management via the Company’s internal website. Employees are provided with benefits and safety which include medical benefits, provident fund, and academic scholarships for doctors, nurses and employees so that they may use the knowledge to assist in the development of the organization. The aim is for the Company to be a place of learning for personnel, as well as to motivate knowledgeable and capable persons to remain with the organization in the long-term. The Company has put in place guidelines in human resources management from recruitment, training to maintaining quality personnel as follows: Recruitment and Career Advancement The Company recognizes the importance of personnel development from the recruitment process. The Company clearly defines the level of education, experience, expertise and other qualifications of each position in order to recruit the most suitable candidates. In recruiting for a particular position, the Company shall give priority to internal staff in order to provide an opportunity for career advancement. If there are no suitable internal candidates, the Company shall then consider external candidates. Each new employee is required to attend orientation in order to be informed about the working process of the various departments within the organization. This will enable employees to plan and act according to the objectives set. The Company also gives importance to career advancement of employees in order to retain outstanding employees. Employee Training The Company has the policy to support training and development of personnel. In order to regularly and continuously develop and improve employees’ skills, the Company organizes both internal and external training sessions. Apart from training on work skills organized internally, the Company also encourages employees to exchange knowledge and experience among the various departments, be it through meetings or information exchange through the intranet. For external training, the Company encourages employees to fill out questionnaires on training desired and will send them to attend those training sessions as appropriate. The Company shall monitor results or measure the knowledge gained in each training course for the greater benefit of the Company and the employees. Employee Evaluation The Company evaluates the employees’ knowledge and skill by clearly and justly specifying the guidelines in evaluating employees of all levels. The employees shall be evaluated based their capabilities and potential in terms of skill, knowledge, attributes and performance. The Company has widely communicated the evaluation guidelines in advance. In determining employee compensation, apart from business profits and the state of the economy in each year, the employee evaluation is also an important factor. By basing employee compensation on employee evaluations, employees will be encouraged to carry out their duties and develop their potential efficiently and effectively. Equal Treatment of Employees The Company recognizes the importance of treating employees equally within the organization, from recruitment to promotion, without bias or nepotism in evaluations, expressing opinions and work.
Good Corporate Governance 67 Annual Report 2012
Employee Satisfaction Surveys In order to become aware of each employee’s satisfaction or happiness in their work, the Company has specified that surveys be conducted of employees at all levels to gather opinions and suggestions. The information gathered can be used to correct and/or improve any shortcomings in management of the organization and personnel both in the short and long term. In addition, the Company has also set guidelines on submitting grievances in order to fairly and justly alleviate any frustration in the work place. Provide Better Quality of Life for Employees The Company recognizes the importance of good quality of life of our personnel, which will encourage our employees to work efficiently. We, therefore, pay close attention to ensuring that the workplace is safe and hygienic for the health and benefit of our employees. The Company provides annual health check-ups to employees. Furthermore, if the number of employees in any department is insufficient for the amount of work assigned, the Company shall employ additional employees so that the amount of work is suitable for the number of employees to better the quality of life for our employees. Build Solid Management and Intra-Working Systems The Company recognizes the importance of continuous work processes from beginning to end in order to produce quality output that meet standards, as well as eliminate and lessen conflicts. To this end, every department has contributed to the Operational Manual to be used as a guideline in communicating and coordinating among departments within the organization. The manual is accessible by all through the intranet and is reviewed and revised as appropriate. Build Good Relationship between Management and Employees The Company recognizes the significance of a good working relationship between management and employees, which affects the work efficiency. Therefore, we have organized activities between management and employees, which will improve the relationship between the two and encourage contentment in the work place; such activities include New Year’s Party, merit making and sports events. In addition, management meets regularly with employees in order to exchange views. This will enable the organization to efficiently and effectively reach for the same goals. Create First-Rate Employees for the Organization and Society In order for employees to conform and for collective discipline, when any employee evades or is in violation of work regulations, that employee will be considered to be at fault. This must be deliberated and rectified according to the regulations by taking into consideration good corporate governance as defined by the Company, which has been set as a guideline for management and employees. The Company firmly believes that developing employees into good and outstanding individuals will ensure the organization’s stable and sustainable growth. 3.5 Policy on Management The Company realizes that management is an important success factor. To this end, the Company has set up a suitable compensation program which is comparable to management in the health care business. Moreover, management is able to carry out their duties and responsibilities independently without intervention, which is for the mutual interest of the organization and all related persons. 3.6 Policy on Counter-Parties The Company does business justly and ethically with partners, competitors, creditors, counter-parties and others according to the terms and conditions in the trade agreement. The Company has the policy to avoid any actions which may be dishonest or infringe on the rights according to the law or as mutually agreed upon of the counterparty, as well as to ensure that the transactions are ethical business-wise. 3.7 Policy on Customers The Company recognizes that the customers are an important success factor of the business. The Company strives for customer satisfaction by providing quality professional service with the determination to continuously improve the quality of medical care services in order to meet the needs and expectations of the customers. This organization maintains the privacy of customers and will not disclose any customer’s information unless required by law or when the customer has given consent.
Good Corporate Governance Annual Report 2012
68
3.8 Policy on Social Responsibility and the Environment The Company aims to consistently treat society and the environment with the highest standards by upholding safety and environment-friendly standards throughout the business. The Company is involved in public interest and has participated in activities that benefit the community and the environment. It is the Company’s policy to act responsibly towards society (please see details under “Social Responsibility Activities” on page 34 of the Annual Report), related persons and personnel within the organization. The Company recognizes the impact of the medical care process on the environment, as well as the safety of the customers and the health of all levels of personnel providing service. To this end, the Company first adopted ISO 14001 for Environmental Management and Mor Or Gor. 18001/ OHSAS18001 for Occupational Hygiene and Safety Management within the organization and received certification from Management System Certification Institute (MASCI). Furthermore, the Company has announced and conveyed the “Environmental, Occupational Health, and Safety Policy” within the hospital to all personnel and related persons from 2003 - 2009. The policy has been practiced earnestly and consistently, garnering awareness and resulting in organizational culture. Moreover, the Company has participated in many charitable activities and has supported the employees concerns regarding the environment and the community. In 2007, the Company established the “Community Relations Committee” to oversee, coordinate and communicate between the organization and the community.
4. Disclosure and Transparency
The Company has the policy to ensure that disclosure of financial information and general information to shareholders, investors and securities analysts, as well as the general public, is done so sufficiently, completely, justly, timely, with transparency, and as prescribed by relevant laws and regulations. The Company has the policy to disclose the financial statements, important information and any other information which may affect the interests of the shareholders or the decision to invest in the Company, which in turn, may affect the price of the shares and/or securities of the Company. This information will be disclosed sufficiently, completely and at the appropriate time through fair and suitable channels. The main purpose is to ensure that the decision to invest in securities of the Company is made fairly and with equal information. The Board of Directors has prepared the report of responsibilities to the financial statements along with the report from the auditors and has included the reports in the annual report and Form 56-1 so that management may recognize the commitment and responsibility to information and financial reports, which must be accurate before being made available to the investors. In communicating externally, executive management who have been assigned the task of disclosing information about the Company are the President, the Chief Financial Officer and Financial Director (Investor Relations). In 2012, the executive officers, including the Financial Director (Investor Relations) met with and provided information at the following opportunities: 1. Road shows: 4 domestically, and 3 abroad (7 times in total) 2. Analyst Meetings: 5 times 3. Company Visits and Conference Calls: 135 times 4. Site Visits: 10 times Apart from the aforementioned instances, the Company provides information on the company, operating results, financial statements, and news to the Stock Exchange of Thailand (SET). Interested persons may look up this information on the SET website www.set.or.th and the Company’s website www.bangkokhospital.com. For further information, investors and interested persons may contact the Financial Director (Investor Relations) by telephone at 0-2755-1793, e-mail: investor@bangkokhospital.com or the company website www.bangkokhospital.com.
69 Annual Report 2012
5.1 Board of Directors The Board of Directors is comprised of 15 members, 7 of those being Executive Directors and 8 being Non-Executive Directors. Of the 8 Non-Executive Directors, 4 are Independent Directors. Executive Directors Executive Directors are Directors who are involved full-time in the management of the Company and receive a monthly salary or other equal compensation from the Company. Non-Executive Directors Non-Executive Directors are Directors who are not involved full-time in the management of the Company nor do they receive a monthly salary from the Company. These Directors may be appointed or be representatives of major shareholders. Independent Directors Independent Directors are Directors who are not involved in management of the Company, subsidiaries, associates or related companies with independent management, major shareholders nor have authority to take over the business. Furthermore, the Independent Directors must not have a business or be involved with the interests of the Company, subsidiaries, associates or related companies, which may negatively affect the interests of the Company and/or shareholders. Qualifications of Independent Directors, which the Company has set according to regulations of the SEC, are as follows: 1. Holds less than 1.0 percent of the voting shares of the Company, its subsidiaries, associates or affiliates. This includes shares held by related persons of the individual independent directors. (Related persons meaning children as defined in Article 258 of the Securities and Exchange Act.) 2. Is not/Has not been an executive director, staff, employee, salaried advisor or person with controlling power of the Company, parent company, subsidiaries, associated companies, same level subsidiaries, major shareholders or persons with controlling power, unless that status has ended for no less than 2 years prior to the appointment. This restriction shall not apply to an independent director who has been a civil servant or an advisor to a government authority that is a major shareholder or controlling person of the Company. (Same level subsidiaries meaning subsidiary with the same parent company.) 3. Is not a blood relative of or has a legally registered relationship as father, mother, spouse, sibling and child, as well as spouse of child, with management, major shareholders with controlling power or individuals to be proposed as management or those having controlling power over the company or subsidiaries. 4. Does not have/Has not had business relationship with the Company, parent company, subsidiaries, associated companies, major shareholders or persons with controlling power, in a way that may hinder one’s independent judgment. In addition, the individual must not be/have been a substantial shareholder or a person with controlling power of an entity that has a business relationship with the Company, parent company, subsidiaries, associated companies, major shareholders or persons with controlling power, unless that status has ended for no less than 2 years prior to the appointment. 5. Is not/Has not been an auditor of the Company, parent company, subsidiaries, associated companies, major shareholders or persons with controlling power of the Company and is not a substantial shareholder, a person with controlling power or partner of an audit firm which employs auditors of the Company, parent company, subsidiaries, associated companies, major shareholders or persons with controlling power, unless that status has ended for no less than 2 years prior to the appointment. 6. Is not/has not been a professional advisor, which includes legal counsel and financial advisor, who receives an annual service fee exceeding Baht 2 million from the Company, parent company, subsidiaries, associated companies, major shareholders or persons with controlling power and is not a substantial shareholder, a person with controlling power or partner of the professional advisor, unless that status has ended for no less than 2 years prior to the appointment.
Good Corporate Governance
5. Responsibilities of the Board of Directors and the Sub-Committees
Good Corporate Governance Annual Report 2012
70
7. Is not a director who has been appointed as a representative of the Company’s directors, major shareholders or a shareholder who is a related person to a major shareholder. 8. Not conducting any business which is of the same nature as or in material competition with that of the Company or its subsidiaries, nor be a substantial partner, executive director, staff, employee, salaried advisor, or hold more than 1% of total shares with voting rights of any company whose business is of the same nature as or in material competition with that of the Company or its subsidiaries. 9. Not posses any other characteristics which may render that person incapable of expressing independent opinions with regards to the Company’s operations. Independent Directors may be assigned by the board of Directors to make decisions regarding operations of the Company, subsidiaries, associated companies, same level subsidiaries or juristic persons that pose a conflict of interest through a collective decision. Separation of Positions 1. Presently, the Chairman of the Board of Directors does not participate in the management of the Company. The Chairman and the President must not be the same person so that the Chairman shall act impartially in determining policy and strategies, as well as ensure that Board meetings are held and that all directors participate and independently raise questions at each meeting. 2. The Company has determined that the Chairman of the Board must not be a member of the Nomination and Remuneration Committee so that the Committee shall be free to make decisions independent of the Board of Directors. Authority of Directors and Management are clearly defined and separated The Board of Directors shall meet regularly each month to monitor and support strategic policies of the Company. At the same time, the Board of Directors shall not interfere with day-to-day operations or business activities under the responsibility of the President and management as only the President is assigned such tasks by the Board and the Executive Committee. Therefore, management efficiently responds to the power and responsibility of the President. Furthermore, the Company has clearly defined the duties and authority of all levels of management. Term of Directorship In principal, directors should not serve for a long, continuous period of time. However, there is a shortage of persons with experience and knowledge and understanding of health care, as well as limitations in finding suitable replacements. In addition, we must take into consideration management risk that may occur because of lack of knowledge and understanding of health care, which is an important factor in selecting directors, especially in the healthcare business, requiring expertise and specialization in order to clearly understand the Company’s business. Therefore, the Company has not set any official limitations on the term of the directors. Duties of Directors Each director has the duty and responsibility in determining and monitoring the operational policies of the Company, apart from the duties and responsibilities as stated in “Shareholding Structure and Management” on page 53 of the Annual Report, which include the following : 1. Directors should have sufficient access to financial information and other business information so that he/she may carryout duties efficiently. 2. Directors should attend every Board meeting as well as sub-committee meetings, and raise important questions to protect and maintain the rights and interests of the shareholders and stakeholders to ensure proper business conduct and operations. 3. Directors should attend every shareholders’ meeting, especially Directors who have been appointed to the Audit Committee, in order to answer and provide explanation to the shareholders’ queries, as well as acknowledge suggestions from the shareholders. 4. Directors should be capable and have the intention to learn about the Company’s business, as well as share opinions independently, devote time to the Company as needed and show interest in the important issues.
Good Corporate Governance 71 Annual Report 2012
5. Independent directors should submit a letter to the Company to confirm that he/she is truly independent, according to the Company’s definition, on the day that he/she has accepted the appointment to the position and each year after such appointment. 6. Directors must submit and update their personal stake and report changes in securities held by him/her, his/her spouse as well as children under juristic age (if any) to show transparency and must report any changes to the Board of Directors’ meeting. 7. Any other duties of the Directors as stipulated in notifications, acts or laws governing the Company. 5.2 Sub-Committees 5.2.1 Audit Committee The Audit Committee is granted full authority by the Board of Directors to carry out its duties, which include systematic monitoring of business practices, ensuring efficient and strict internal control measures, ensuring compliance with laws on disclosure and determining risk management dealing with the business and finances of the Company. Presently, two of the Audit Committee members are knowledgeable and have direct experience in accounting and finance. In planning internal audits, the Audit Committee will have the internal audit officers plan the audit of the Company for the entire year. The Company has hired an external company, which is licensed and qualified in auditing companies listed on the stock exchange as defined by the SEC, to carry out the internal audit. We believe that internal audit by external auditors will result in just and efficient reporting of the facts as they have independence and flexibility. The Audit Committee will report the activities of the internal auditors at the Board of Directors’ meeting immediately after each meeting. At Audit Committee meetings that deal with the financial statements and disclosure of financial reports of the Company, the Chief Financial Officer and the Accounting Director will both be in attendance. Prior to meetings on the financial statements with management, the Audit Committee shall meet with the accounting auditors separately, without management, to enquire about the important risks that may occur from the financial statements or the financial status or limitations, which the auditor has found in the process of auditing the financial statements of the Company and subsidiaries. This is to ensure that auditors are able to act independently without impediments in auditing the Company. 5.2.2 Nomination and Remuneration Committee In order to comply with good corporate governance of listed companies, the Board of Directors passed a resolution to appoint the Nomination and Remuneration Committee. The Committee must be mainly comprised of directors who do not take part in management and have the duty to seek qualified candidates for nomination as directors of the Company for both replacements of directors who have retired and new director positions, as well as the Chief Executive Officer and the President. Furthermore, the Committee shall set the guidelines to determine appropriate remuneration for the Board of Directors, sub-committee members, and the Chief Executive Officer and President. 5.2.3 Executive Committee With the rapid growth of the Company through the merger with Phyathai and Paolo Hospital Groups in 2011 and in order to ensure that the Company follows the strategy, goals and plans set for the year, the Board of Directors made the decision to appoint the Executive Committee. The Committee is comprised of 5 executive directors and has the responsibility to supervise and ensure that the Company and its subsidiaries act in accordance with the set plans. In addition, the Executive Committee shall consider reports by management that are to be presented to the Board of Directors as well as have the authority to approve normal business transactions or transactions that support normal business activities of the Company within a given monetary limit.
Good Corporate Governance Annual Report 2012
72
The approval authority of the Executive Committee cannot be used with persons that may have conflict of interest, stake or any other forms of conflict with the Company or subsidiaries. Such authority also does not include connected transactions and purchase/sale of important assets of the listed Company in accordance with the rules and regulations of the Stock Exchange of Thailand or other related regulations. The Company must act in accordance with the rules and regulations of the Stock Exchange of Thailand or other related regulations on such particular matter. The approval authority of the Executive Committee does not include other matters which require approval from the shareholders’ meeting as stated in the Articles of the Company. 5.3 Board of Directors Meetings and Sub-Committee Meetings The Company has set the dates for the Board of Directors’ meetings in advance for the entire year so that the Directors are all informed of the meetings in advance and can arrange their schedules to accommodate the meetings. The meetings are to be held on the last Wednesday of each month with the Executive Committee meeting to be held on the Wednesday prior to the Board meeting. The agenda of each meeting will also be set in advance and will include continuing agendas to follow up on any assignments from prior meetings. The Company Secretary shall send meeting invitations and the agenda at least 7 business days in advance of each meeting in order to allow directors sufficient time to review the information prior to attending the meeting. The minutes of the meetings are sent to the Directors within 14 days from the day of the meeting so that they may review and ensure that the minutes are in accordance with the meeting resolutions. The meetings of the Audit Committee and the Nomination and Remuneration Committee are not set in advance. The meetings of the two sub-committees are held as deemed appropriate and when opportunity allows in order to accomplish the duties assigned. After the sub-committee meetings, the Chairman of the committees or an appointed representative shall report the result of the meeting to the Board of Directors at the next Board meeting. In 2012, the meetings of the Board of Directors and the sub-committees can be summarized as follows: Director’s Name 1. Prof. (Emeritus) Arun Pausawasdi, M.D. 2. Mr. Chuladej Yossundharakul, M.D. 3. Mr. Wichai Thongtang 4. Mr. Prasert Prasarttong-Osoth, M.D. 5. Mr. Pongsak Viddyakorn, M.D. 6. Mr. Chirotchana Sucharto, M.D. 7. Mr. Pradit Theekakul 8. Prof. (Emeritus) Santasiri Sornmani, M.D. 9. Mr. Thavatvong Thanasumitra 10. Mr. Chatree Duangnet, M.D. 11. Mr. Chavalit Setmeteekul 12. Dr. Somchai Sujjapongse 13. Mr. Sripop Sarasas 14. Miss. Kanoknuj Lekvichit 15. Mr.Thongchai Jira-alongkorn (1)
Title
Attendance at meetings
Chairman 1st Vice Chairman 2nd Vice Chairman President Director Director Director Independent Director Director Director Independent Director Independent Director Independent Director Director Director
15/16 16/16 15/16 16/16 15/16 16/16 16/16 16/16 14/16 16/16 15/16 9/16 16/16 16/16 10/10
Note : (1) Appointed at the Annual General Shareholders’ Meeting in 2012 on 20th April 2012 as Director of the Company and attended the Board of Directors’ meeting from the 4/2012 meeting onwards.
Director’s Name 1. Mr. Prasert Prasarttong-Osoth, M.D. 2. Mr. Chuladej Yossundharakul, M.D.
Title Chairman of Executive Committee Executive Director/Nomination and
Attendance at Attendance at Attendance at Nomination and Executive Committee Audit Committee Remuneration meetings meetings Committee meetings
10/10 7/7
Executive Director Executive Director Executive Director Independent Director/Chairman of the
10/10 9/10 5/7 8/8
2/2
Audit Committee/Chairman of the Nomination and Remuneration Committee
7. Mr. Chavalit Setmeteekul
2/2
Independent Director /Nomination and Remuneration Committee Member
8. Dr. Somchai Sujjapongse
Independent Director/Audit Committee Member/Nomination and Remuneration Committee Member
3/8
1/2
9. Mr. Sripop Sarasas
Independent Director/Audit Committee Member/Nomination and Remuneration Committee Member
8/8
2/2
Note : The Meeting of the Board of Directors 5/2012 held on 30th May 2012 appointed Mr. Chuladej Yossundharakul, M.D. and Mr.Thongchai Jira-alongkorn as Executive Directors replacing those that had retired and finished their term, both Directors attended the Meeting 4/2012 onwards.
5.4 Determining Remuneration for Directors and Executives Presently, the Company has appointed the Nomination and Remuneration Committee the task of justly determining the remuneration of directors to correspond to the directors’duties and responsibilities by comparing to those of companies of similar size in the same industry. As for remuneration of executives, the Company will award remuneration by performance evaluation as stated in the guidelines defined by the Board of Directors and the Human Resources Department for each level of management. The performance is linked to the operational results of the Company and individual accomplishments. 5.5 Directors’ Knowledge Enhancement The Company has the policy to encourage directors of the Company and subsidiaries to attend the Director Certificate Program (DCP) and the Director Accreditation Program (DAP) organized by the Thai Institute of Directors (IOD). The programs will provide the directors with knowledge and understanding of efficient corporate governance and will enable them to use the knowledge for continuous good corporate governance. Fifteen of the directors have attended and passed the Director Certificate Program and/or the Director Accreditation Program. The Company also encourages directors to attend training courses on amendments and updates of the regulations, policies and guidelines of the Stock Exchange and the SEC. The Company has assigned the Company Secretary the task of summarizing significant changes to the regulations or guidelines to the President for further reporting to the Board of Directors for their acknowledgement and practice. In some cases, the Company may invite experts in specific fields to present such information or guidelines to the Board of Directors for their acknowledgement and practice. In conjunction, the Company also supported the Company Secretary’s attendance in the Director Certificate Program in 2012.
73 Annual Report 2012
3. Mr. Chatree Duangnet, M.D. 4. Mr. Pradit Theekakul 5. Mr.Thongchai Jira-alongkorn 6. Prof. (Emeritus) Santasiri Sornmani, M.D.
Good Corporate Governance
Remuneration Committee Member
Connected Transactions
Connected Transactions
Nature of Transactions
Annual Report 2012
74
Transactions between the Company or subsidiaries and a person with conflict of interest are normal practice in business dealings and the conditions are the same as those of dealings with external parties. Such transactions have been approved in principal by the Board of Directors at Meeting 8/2008. Therefore, the Audit Committee, which has reviewed the transactions for the year ended 31st December 2012 and 31st December 2011, has the opinion that the transactions with persons with conflict of interest have the same conditions as transactions with external parties, there has not been any transfer of benefits to the persons with conflict of interest and are in accordance with the resolution of the Board of Directors. The transactions can be categorized into 2 types as follows: 1. Normal Business Transactions or Transactions Supporting Normal Business The Company has measures or procedures in approving normal business transactions or transactions supporting normal business. Therefore, management shall consider approving small transactions and normal business transactions with the same conditions as transactions with external parties. The Board of Directors shall approve in the case of medium to large normal business transactions and small to medium transactions that have exceptional conditions. For large transactions that have exceptional conditions, the Board of Directors shall propose the transaction to the shareholders’ meeting for approval. The size of the transaction is evaluated as follows: • Small transactions: transactions with value of less than or equal to Baht 1 million or less than or equal to 0.03% of net assets, whichever is higher. • Medium transactions: transactions with value of more than Baht 1 million but less than Baht 20 million or more than 0.03% but no more than 3% of net assets, whichever is higher. • Large transactions: transactions with value of more than Baht 20 million or more than 3% of net assets, whichever is higher. The Securities and Stock Exchange Act (Fourth Edition) Amendment B.E. 2551 effective 31st August 2008 and the Securities and Exchange Commission circular dated 16th July 2008 state that for flexibility, the Company may bring transactions with associated companies which are normal business transactions or transactions supporting normal business between the Company or subsidiaries and a related person in front of the Board of Directors for approval in principal. Therefore, at the Board of Directors Meeting 8/2008 on 27th August 2008, the Board gave management approval in principal to consider entering into normal business or transaction supporting normal business transactions with normal conditions, which are priced or have fees charged at the market rate with the same conditions as the Company’s transactions with external parties. 2. Financial Assistance The Company has the policy to provide financial assistance to subsidiaries in which the Company holds more than 50 percent of the shares outstanding. The financial assistance is provided under the condition that the subsidiary has no related person that holds more than 10 percent of the remaining shares. The Board of Directors’ Meeting
2/2008 on 26th February 2008 and Meeting 5/2008 on 28th May 2008 resolved that the Company shall provide financial assistance to subsidiaries under the aforementioned conditions. As of 31st December 2012, the Company provided financial assistance in the following forms:
2.2 Guarantee loans of foreign subsidiaries Benefit derived To enable the foreign subsidiary to seek a loan directly from a financial institution in that particular country at a prime rate. 2.3 Centralize Liquidity Management (Cash Pooling) At the end of the business day, the liquidity management program will transfer money from the subsidiary’s bank account to the Company’s bank account. The money transferred into the Company’s bank account will be stated as short-term loan from a subsidiary with interest charged at the market rate. At the same time, if any subsidiary requires capital, the Company will transfer the excess liquidity to the subsidiary with interest charged at the market rate. Benefit derived For liquidity management within the Group, companies with excess liquidity will receive interest at a rate higher than the savings rate of financial institutions, while companies needing capital can borrow at a rate no higher than the market rate.
75 Annual Report 2012
Benefit derived The subsidiary can take out a loan at a rate lower than borrowing directly from a financial institution as the Company is capable of seeking loans at a lower rate.
Connected Transactions
2.1 Loans to subsidiaries The Company will take out a loan in the money market or from a financial institution and then loan that money to the subsidiary at a rate of no more than 1% per annum above the actual cost of capital, which is less than the rate the subsidiary would be charged if taking out a loan directly.
Company holds 97.3% Company holds 100.0% Company holds 98.8% Company holds 99.7% Company holds 100.0% Company holds 99.8% Company holds 90.4% Company holds 99.7% Company holds 79% Company holds 95.8% Company holds 91.5% Company holds 98.3% Company holds 99.9% Company holds 85.7% Company holds 99.8% Company holds 93.3% Company holds 80% Company holds 100.0% Company holds 70.0% Company holds 74.0% Company holds 95.0% Company holds 100.0% Company holds 100.0% Subsidiary holds 100.0% Company holds 100.0% Company holds 100.0% Company holds 100.0% Company holds 100.0% Company holds 100.0%
223,900,000 3,327,020,000 508,540,000 559,000,000 101,270,000 38,107,125 354,220,963 58,921,976 100,000,000 54,000,000 5,324,980,064 11,700,794 130,374,543 207,098,786
21,345,798 43,677,651 -
-
-
-
-
Advance
Loan to Subsidiaries
16,026,419
473,593
149,251 149,234 1,595,147 243,820 268,014 48,554 12,746 12,573,905 439,863 54,795 17,497 -
Interest receivable 245,395,049 43,826,885 3,328,615,147 508,783,820 559,268,014 101,318,554 38,119,871 366,794,868 59,361,839 100,054,795 11,718,291 184,848,136 5,548,105,269
Total debt
Connected Transactions
Long term loan Short term loan
(1) Debt for loan in foreign currency US$ 1.25 million (equal to Baht 38.11 million) (2) Debt for loan in foreign currency US$ 11.52 million (equal to Baht 354.22 million) (3) Debt for loan in foreign currency US$ 1.98 million (equal to Baht 58.92million)
Bangkok Hospital Pattaya Co., Ltd. Bangkok Hospital Rayong Co., Ltd. Bangkok Hospital Had yai Co., Ltd. Wattanavej Co., Ltd. Bangkok Hospital Samui Co., Ltd. Bangkok Hospital trat Co., Ltd. Bangkok Hospital Ratchasima Co., Ltd. Bangkok Hospital Phuket Co., Ltd. Bangkok Hosital Prapradaeng Co., Ltd. Samitivej Plc. (SVH) BNH Medical Center Co., Ltd. Prasit Patana Plc. (PPCL) Paolo Medic CO.,LTD. Siam Medical Co., Ltd. Thai Medical Center PLC. Paolo Samut Prakran Co., Ltd. Ankor Pisith Co., Ltd (1) Phnom Penh Medical Services Co., Ltd.(2) Royal Rattanak Medical Services Co., Ltd.(3) National Healthcare Systems Co., Ltd. Bio-Molecular Laboratories (Thailand) Co., Ltd. Greenline Synergy Co., Ltd. BDMS Training Co., Ltd. A.N.B. Laboratory Co., Ltd. Bankok Premier Life Insurance Co., Ltd. Bangkok Hospital Udon Co., Ltd. Bangkok Hospital Chaingmai Co., Ltd. Asia International Healthcare Co., Ltd. Bangkok Hospital Khao Yai Co., Ltd.
Remarks
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29
Relationship
Annual Report 2012 76 N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A USD 3,898,357 N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A USD 3,898,357
Guarantee Obligation 418,118,951 26,520,305 60,312,687 148,635,103 55,943,321 35,442,759 188,237,152 84,566,865 83,978,040 749,946,256 122,760,472 93,171,851 110,618,174 125,342,079 43,475,988 4,943,161 195,363,379 233,748,005 13,500,000 2,000,000 2,796,624,548
Cash Pooling
1,628,165 131,654 186,908 374,035 135,534 94,235 14,593 422,108 181,925 409,286 1,847,740 447,201 226,851 275,450 338,470 163,960 21,367 547,395 506,768 7,953,645
Accure Interest
(Unit : baht)
Policy and Future Related Transactions Transaction
Outlook and Policy
Normal business transactions such as medical care, patient transfer, and lab analysis, etc.
The Company has the policy to allow the Company and subsidiaries to charge each other fees at the market rate. The medical service fees and conditions of payment, as well as other business conditions, shall be equal or have similar conditions or are indifferent from those the Company and subsidiaries charge other customers, whether individuals or counter-parties, under the same circumstances.
Transactions supporting general business such as creditors, and debtors, etc.
In the case that the Company and subsidiaries engage in sale of goods and services, raw materials and medical supplies, procurement, hiring, construction contract between the companies, or between the Company or subsidiary and a related person and such transaction supports normal business, such transaction must have competitive price or fee or must have a reference rate available. The conditions of payment and other terms and conditions must not differ from those of transactions that the Company and subsidiaries engages in with other counter-parties, under the same circumstances.
Financial assistance
The Company has the goal and policy to provide financial assistance to subsidiaries within the Group by centralizing money management for suitable cost of capital and efficiency for the benefit of the organization as a whole. In determining the loan amount, the Company shall give greater importance to the ability to repay the loan than the percentage of shareholding. The rate must not be less than the cost of capital of the Company. Such transactions must comply with the Securities and Exchange Act and/or rules and regulations of the Stock Exchange of Thailand and/or the notifications of the Capital Market Committee.
Connected Transactions
3. Persons with mutual interest holding shares in subsidiaries and associated companies over 5% of shares with voting rights: - None For other transactions or connected transactions as defined in the Securities and Exchange Act, the Company shall act in accordance with the rules and regulations of the Securities and Exchange Act as well as with other related notifications. Furthermore, for investor protection, the Company has assigned the Audit Committee the task of ensuring that connected transactions are fair. In the case that the Audit Committee does not have expertise in considering the connected transactions, the Company has the policy to appoint independent persons with professional expertise to provide opinion on such transactions to the Audit Committee and/or the Board of Directors and/or the shareholders’ meeting, as the case may be. The Company has disclosed the connected transactions in the Note 10 “Connected Transactions” in notes to the audited financial statements, which have been certified by an auditor.
77 Annual Report 2012
Related persons who are directors and executive management are as follows: 1. Mr. Prasert Prasarttong-Osoth, M.D. 2. Mr. Chuladej Yossundharakul, M.D. 3. Mr. Wichai Thongtang 4. Mr. Pongsak Viddyakorn, M.D. 5. Mr. Chirotchana Sucharto, M.D. 6. Mr. Chatree Duangnet, M.D. 7. Mr. Pradit Theekakul 8. Miss. Kananuj Lekvichit 9. Mrs. Narumol Noi-am The Director was appointed to the subsidiary as a representative of the Company as a major shareholder, not as a personal appointment.
Management Discussion and Analy sis
Management Discussion and Analysis
Annual Report 2012
78
for the year ended December 31, 2012
Since April 1, 2011, the Company had completely acquired and accepted the Entire Business Transfer of Health Network Public Company Limited (“Health Network”). As a result, the Company has become a major shareholder and consolidated the performance of: - The Phyathai Hospital Group, which has Prasit Patana Public Company Limited (“PPCL”) as the major shareholder, consists of Phyathai 1 Hospital Company Limited, Phyathai 2 Hospital Company Limited, Phyathai 3 Hospital Company Limited and Sriracha Nakhon Hospital Public Company Limited (Phyathai Sriracha). - The Paolo Memorial Hospital Group consists of Paolo Medic Hospital Company Limited (Paolo Memorial Hospital, Phaholyothin), Paolo Samutprakarn Company Limited (Paolo Memorial Hospital, Samutprakarn), Siam Medical Company Limited (Paolo Memorial Hospital, Chokchai 4) and Thai Medical Centre Public Company Limited (Paolo Memorial Hospital, Nawamin). Summary of consolidated operating results Revenues from hospital operations Revenue from sales of goods and food Other income Total Operating Income Cost of hospital operations and others Administrative and management benefit expenses Total Operating Expenses & Depreciation Operating Profit Interest income Dividend income Income from associated companies EBIT Finance expenses Taxes Non-controlling interests of the subsidiaries Normalized Profit Non - Recurring Items - Gain on fair value adjustment of investments Profit to equity holders of the Company
(Unit : THB mm)
2012
2011
% yoy
44,307 1,171 516 45,994 (29,239) (8,969) (38,207) 7,787 57 17 968 8,827 (849) (1,521) (315) 6,142 1,795 7,937
35,224 1,009 492 36,726 (23,675) (7,224) (30,900) 5,826 63 104 382 6,374 (770) (1,456) (241) 3,907 479 4,386
26% 16% 5% 25% 23% 24% 24% 34% (10)% (84)% 154% 37% 10% 4% 31% 57% 81%
2011
10,737 23.3% 8,827 19.2% 13.4% 17.3% 3.97 5.14
8,534 23.2% 6,374 17.4% 10.6% 11.9% 2.67 3.00
% yoy 26% 38%
49% 71%
Remark : - * Excluding non-recurring items
2012 Consolidated Performance
For the year ended December 31, 2012, the Company and its subsidiaries recorded a consolidated net profit of Baht 7,937 million; an increase of Baht 3,551 million, or 81% from 2011. The summarized 2012 consolidated performance is as follows:1. Operating income Operating income during 2012 were Baht 45,994 million, an increase of Baht 9,268 million or 25% from 2011, primarily due to: - Revenue from hospital operations during 2012 were Baht 44,307 million, an increase of Baht 9,083 million or 26% from 2011. The growth was driven by increase in number of outpatients and inpatients across our network hospitals, rising healthcare inflation together with an increase in patient acuity. Moreover, the consolidation of revenues from Phyathai Hospital Group and Paolo Memorial Hospital Group started from 2Q11 onwards. - During this year, Thai and international patients grew 15%1 and 24%1 from 2011 respectively resulting in the revenue proportion between Thai and international patients to change from 74% : 26% in 2011 to 72% : 28% in 2012. From type of patient perspective, outpatient revenues increased by 17%1 whereas inpatient revenues increased by 18%1 from 2011.
- Revenue from sales of goods and food were Baht 1,171 million, an increase of Baht 161 million or 16% from 2011, as a result of growth in revenues from A.N.B. Laboratories Company Limited. - Other incomes were Baht 516 million, an increase of 5% from 2011. 2. Operating expenses - The Company and its subsidiaries reported cost of hospital operations and others (including depreciation and amortization) of Baht 29,239 million in 2012, an increase by 23% from 2011. An increase was due mainly to the consolidation of Phyathai Hospital Group and Paolo Memorial Hospital Group, an organic growth in revenue from hospital operations together with the rise in clinical staff expenses as a result of an increase in newly recruited and also experienced nurses to meet the expanding needs of network hospitals. 1 For comparative purpose, growth of the revenue from hospital operations are calculated assuming consolidation of Phyathai Hospital Group and Paolo Memorial Hospital Group since January 1, 2011
79 Annual Report 2012
EBITDA* (THB mm) EBITDA margin* EBIT* (THB mm) EBIT Margin* Net profit margin* Net profit margin Basic earnings per share* (baht) Basic earnings per share (baht)
2012
Management Discussion and Analy sis
Profitability Analysis
Management Discussion and Analy sis Annual Report 2012
80
- The administrative expenses (including depreciation and amortization) were Baht 8,969 million in 2012, an increase by 24% from 2011, due mainly to the consolidation of Phyathai Hospital Group and Paolo Memorial Hospital Group together with the rise in non-clinical staff expense, an increase in general support expenses mainly from wages increase of outsourced cleaning and securities services together with an increase in repair and maintenance expenses. EBITDA; consequently, increased from Baht 8,534 million in 2011 to Baht 10,737 million in 2012, increased by 26% from 2011. EBITDA margin also increased slightly from 23.2% in 2011 to 23.3% in 2012. 3. Depreciation and amortization expenses The depreciation and amortization expenses were Baht 2,951 million in 2012, an increase by 9% from 2011 due mainly to the consolidation of property, premises and equipment from Phyathai Hospital Group and Paolo Memorial Hospital Group and the expansion of existing network hospitals to accommodate patient growth 4. Others - Interest income was Baht 57 million, decreased slightly by 10% from 2011 - Dividend income was Baht 17 million, decreased by 84% from 2011 since the Company recorded dividend income of Baht 104 million from an investment in BH during 4Q11. The Company, subsequently, increased its shareholding in BH to 23.88% and BH becomes our associated company. - Share of income from investments in associated companies was Baht 968 million, increased by 154% from 2011, due mainly to share of income from investment in RAM of Baht 431 million together with share of income from investment in BH of Baht 498 million. - Finance expenses increased to Baht 849 million or increased by 10% from 2011 due mainly to an issuance of debentures and an increase in long-term loans from financial institutions. - Taxes in 2012 were Baht 1,521 million, an increase from Baht 1,456 million in 2011, due mainly to increase in pre-tax profit, netted with the reduction in corporate income tax rate to 23%. 5. Non-recurring items During 1Q12, the Company additionally purchased ordinary shares of BH for total of 44.2 million shares, amount of Baht 2,234.9 million, representing 6.06 % of shareholding. As a result, the Company holds totally 20.28 % of shareholding, as of March 31, 2012, resulting in BH to become an associated company. However, in 2Q12, the Company increased its shareholding in BH to 23.88%. During 1Q12, the Company recorded non-recurring items for gain on fair value adjustment of investment in BH totaling Baht 1,795 million from this “Step Acquisition” in accordance with Thai Financial Reporting Standard (“TFRS 3”) – Business Combinations (effective in 2011) which the Company are required to revalue the original stake from the carrying cost to the fair value and recognize the difference in the statements of income. During 2Q11, the Company and its subsidiaries recorded non-recurring items for gain on fair value adjustment of investments totaling Baht 479 million as a result of “Step Acquisition” for the acquisition of Prasit Patana Public Company Limited and the additional investment in Udon Pattana (1994) Co., Ltd.
Comprehensive income statements
(Unit : THB mm)
2012 Profit for the period Gain(Loss)on change in value of available-for-sale investments Reversal of gain on change in value of available-for-sale investments Actuarial loss Gain on revaluation of land Exchange differences Share of other comprehensive income from associated companies Total comprehensive income for the period
8,252 5 (1,372) (132) 634 (35) 114 7,467
2011 4,627 1,372 (3) 9 51 65 6,121
% yoy 78% (100)% N/A N/A N/A (168)% 75% 22%
Total comprehensive income for 2012 was Baht 8,252 million, an increase by 78% from 2011 from 2011, mainly attributable to higher profit for the period as mentioned earlier netted with the reversal of gain on change in value of available-for-sale investments due to transfer of investment in BH to an associated company for Baht 1,372 million together with the actuarial loss of Baht 132 million. In addition, as mentioned earlier, the Company and its subsidiaries recognized gain on revaluation of land of Baht 634 million. The Company also has recognized share of other comprehensive income from associated companies of Baht 114 million which was mainly as a result of gain on change in value of available-for-sale investments of RAM. Consolidated financial status Total Assets Total Liabilities Total equity attributable to company's shareholders Total shareholders' equity
(Unit : THB mm)
Dec-12
Dec-11
Chg %
68,461 29,634 37,296 38,827
58,792 25,375 31,995 33,417
16% 17% 17% 16%
Management Discussion and Analy sis
If including the non-recurring items, the Company and its subsidiaries recorded a consolidated net profit of Baht 7,937 million in 2012; an increase of Baht 3,551 million, or 81% from 2011. Net profit margin significantly increased from 11.9% in 2011 to 17.3% in 2012 and the basic earnings per share increased from Baht 3.00 in 2011 to Baht 5.14 in 2012 or grew 71% from 2011.
81 Annual Report 2012
As a result, if excluding non-recurring items which are gain on fair value adjustment of investments as previously mentioned, net profit was Baht 6,142 million, an increase of Baht 2,235 million or 57% from 2011. Net profit margin, excluding non-recurring items, increased from 10.6% in 2011 to 13.4% in 2012 and the basic earnings per share increased from Baht 2.67 in 2011 to Baht 3.97 in 2012 or grew 49% from 2011.
Management Discussion and Analy sis Annual Report 2012
82
The consolidated financial position of the Company and its subsidiaries as of December 31, 2012: The Company and its subsidiaries reported total assets of Baht 68,461 million, an increase of Baht 9,669 million or 16% from December 31, 2011, due mainly to an increase in investment in associated companies of Baht 10,048 million, offset with decrease in other long-term investments of Baht 4,554 million. These changes were as a result of additional stake in BH resulting in BH to become an associated company. In additional, there is an increase in property, premises and equipment of Baht 3,722 million as a result of the expansion of existing network hospitals to accommodate patient growth together with the purchase of land for Bangkok Hospital Chiangmai and acquisition of property, premises and equipment for Bangkok Hospital Udon, our new network hospitals in the North and the Northeast of Thailand respectively. Total consolidated liabilities as of December 31, 2012 were Baht 29,634 million, an increase of Baht 4,259 million or 17% from December 31, 2011, due mainly to an increase in short-term loans from financial institutions of Baht 994 million, an issuance of debentures amounting to Baht 600 million and an increase in long-term loans from financial institutions amounting to Baht 1,684 million partly to finance the additional investment in BH and the expansion of our network hospitals. However, total debt to equity remains unchanged at 0.5x as of December 31, 2011 and as of December 31, 2012 while net debt to equity also remains unchanged at 0.4x as of December 31, 2011 and as of December 31, 2012. Total consolidated shareholders’ equity was Baht 38,827 million, increased by Baht 5,410 million or 16% from the year ended 2011. This is due mainly to total comprehensive income during 2012 netted with dividend payment of Baht 1,700 million. Liquidity For the year ended December 31, 2012, the Company and its subsidiaries had net decrease in cash and cash equivalent of Baht 286 million, with the cash and cash equivalents at the beginning of the year of Baht 3,876 million. As a result, cash and cash equivalents at the end of the year was Baht 3,590 million. Details of cash flow by activities are as follows:(Unit : THB mm) 2012 Net cash from operating activities Net cash (used in) investing activities Net cash from financing activities Net increase(decrease) in cash and cash equivalents Cash and cash equivalents at beginning of the year Cash and cash equivalents at end of the year
8,409 (9,716) 1,020 (286) 3,876 3,590
Net cash flows from operating activities were Baht 8,409 million, resulting mainly from an increase in profit during the year. Net cash used in investing activities were Baht 9,716 million. The investing activities during the year were mainly from investments in subsidiaries, associates and other companies of Baht 4,267 million and the purchase of property, premises and equipment for Baht 5,791 million. Net cash from financing activities were Baht 1,020 million comprising mainly from an increase in net short-term loans from financial institutions of Baht 995 million, an increase in long-term loans from financial institutions of Baht 6,618 million, netted with repayment of long-term loans from financial institutions of Baht 4,931 million and dividend payment of Baht 1,700 million.
Auditor’s Remuneration Ernst & Young Office Company Limited has been the auditor of the Company and its subsidiaries since the annual audit in 2005 to the present. In 2012, the Company and its subsidiaries have compensated the auditor as follows: 1. Auditing Fee The Company and subsidiaries paid a total of Baht 17,296,500 in auditing fees, details as follows: Annual Audit Fee
Total
870,000 5,296,500
1,030,000 10,100,000
1,900,000 15,396,500 17,296,500
Bangkok Dusit Medical Services Plc. 37 companies in the Network Total auditor remuneration
2. Other fees - none -
83 Annual Report 2012
Review of 3 quarterly financial statements
Auditor’s Remuneration
(Unit : Baht)
Report and consolidated financial statements Annual Report 2012
84
Report and consolidated financial statements Bangkok Dusit Medical Services Public Company Limited and its subsidiaries
31 December 2012
Report of the Audit Committee
In 2012, the Audit Committee held meetings a total of 8 times to carry out duties as assigned, the most important being: 1. Review the financial statements of the Company and subsidiaries, before presentation to the Board of Directors, as reviewed and explained by the auditor and executive management. The Audit Committee is of the opinion and belief that the aforementioned financial statements were prepared according to accounting standards with accurate and complete disclosure of important facts. 2. Consider and nominate the auditor from Ernst & Young Office Company Limited and the annual auditing fee to the Board of Directors for further approval by the Shareholders’ Meeting. The Audit Committee is of the opinion that the person nominated as the auditor is qualified in terms of knowledge, capability with independence from the Company and subsidiaries. 3. Consider transactions with related persons, disclosure of transactions with related persons and ensure that acquisitions or sales of assets are in compliance with applicable laws and regulations. 4. Consider approving the annual audit plan, review internal audit procedures, which are a part of the Company’s management policy, and provide written approval on the internal audit process to be used as a guideline according to international standards. 5. Consider and hear the internal audit report from the internal auditors by engaging an internal audit company that is licensed by the Office of the Securities and Exchange Commission. The internal auditors carried out the audit according to the importance of the risks as assessed. The Audit Committee provided suggestions to the Board of Directors and executive management on good corporate governance and internal controls. In addition, the Committee gave importance to suitable arrangement of the Shareholders’ meeting according to the guidelines of the Stock Exchange of Thailand, compliance with laws, regulations and practices, and efficiency in risk evaluation and risk mitigation of the various departments and the organization. 6. Review and assess the sufficiency of the internal control systems annually. The Committee is of the opinion that the internal control system is suitable and sufficient in risk mitigation in accordance with the policies and strategies of the Company. 7. Confer with the auditor without management so that the auditor can freely report on any problems or limitations as a result of the audit. The auditor has reported that there were no limitations of significance. The Audit Committee has carried out the duties as assigned with care and to the best of our ability for the benefit of the Company, the Shareholders and all stakeholders.
Professor (Emeritus) Santasiri Sornmani, M.D. Chairman of the Audit Committee
85 Annual Report 2012
The Board of Directors of Bangkok Dusit Medical Services Public Company Limited appointed the Audit Committee, which is comprised of 3 independent directors, namely Professor (Emeritus) Santasiri Sornmani, M.D. as Chairman of the Audit Committee and Mr. Sripop Sarasas and Dr. Somchai Sujjapongse as members of the Committee. The main duties and responsibilities of the Audit Committee are to ensure that the Company’s financial statements are in accordance with accounting standards and have accurate and sufficient disclosure, ensure that the Company has an internal control system, evaluate the risks and ensure suitable and efficient risk controls, ensure compliance with related regulations and laws, as well as mitigate conflicts of interest between the Company and related persons.
Report of the Audit Committee
Dear Shareholders of Bangkok Dusit Medical Services Public Company Limited,
The Board of Directors’ Report on its Responsibility to the Financial Statement
The Board of Directors’ Report on its Responsibility to the Financial Statement
Annual Report 2012
86
The Board of Directors recognizes the importance of duties and responsibilities in ensuring that the Company practices good corporate governance, that the financial statements in the 2012 Annual Report are accurate and fully disclosed, as well as in compliance with generally accepted accounting standards by selecting appropriate accounting policies and consistently adhering to those policies, with careful discretion. The Board of Directors has assigned the Audit Committee the task of reviewing the Company’s financial statements and has been informed that the financial statements are in compliance with generally accepted accounting standards by selecting appropriate accounting policies and consistently adhering to those policies. The financial statements were carefully prepared with consideration of the suitable items to be presented and provide sufficient disclosure in the notes. The Audit Committee has reported these opinions in the Audit Committee Report in the 2012 Annual Report and the Company’s 2012 Form 56-1. Furthermore, the Board of Directors has put in place an efficient internal control system to ensure that all accounting information is recorded accurately and assets are safe-kept in order to prevent fraud or significant damages. In conclusion, the Board of Directors is of the opinion that the Company’s internal control system is satisfactory and reasonably believes the trustworthiness of the Company’s financial statements as of 31st December 2012, which the auditor has reviewed in accordance with generally accepted accounting standards. Additionally, the financial statements accurately show the significant aspects of the Company’s financial status and performance in accordance with generally accepted accounting standards.
(Mr. Prasert Prasarttong-osoth, M.D.)
CEO & President
Report of independent auditor
Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with Thai Financial Reporting Standards, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor's Responsibility My responsibility is to express an opinion on these financial statements based on my audit. I conducted my audit in accordance with Thai Standards on Auditing. Those standards require that I comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion. Opinion In my opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Bangkok Dusit Medical Services Public Company Limited and its subsidiaries as at 31 December 2012, and their financial performance and cash flows for the year then ended, in accordance with Thai Financial Reporting Standards.
Wichart Lokatekrawee
Certified Public Accountant (Thailand) No. 4451 Ernst & Young Office Limited Bangkok: 27 February 2013
87 Annual Report 2012
I have audited the accompanying consolidated financial statements of Bangkok Dusit Medical Services Public Company Limited and its subsidiaries, which comprise the consolidated statement of financial position as at 31 December 2012, and the related consolidated statements of income, comprehensive income, changes in shareholders’ equity and cash flows for the year then ended, and a summary of significant accounting policies and other explanatory information, and have also audited the separate financial statements of Bangkok Dusit Medical Services Public Company Limited for the same period.
Report of independent auditor
To the Shareholders of Bangkok Dusit Medical Services Public Company Limited
Bangkok Dusit Medical Services Public Company Limited and its subsidiaries As at 31 December 2012
Statement of financial position Assets
(Unit: Baht)
Statement of financial position
Consolidated financial statements
Annual Report 2012
88
Current assets Cash and cash equivalents Short-term investments Trade and other receivables Dividend receivable - related parties Short-term loans to related parties Inventories Other current assets Total current assets Non-current assets Long-term deposit at financial institution Restricted financial institution deposits Investments in associated companies Investments in subsidiary companies Other long-term investments Long-term loans to related parties Investment properties Property, premises and equipment Land and buildings not used in operation Goodwill Intangible assets Other non-current assets Leasehold rights Others Total non-current assets Total assets
Separate financial statements
Note
2012
2011
2012
2011
6
3,589,575,612 267,768,130 4,287,063,795 11,268,600 779,882,276 150,337,990 9,085,896,403
3,875,733,420 464,365,921 3,377,111,722 1,037,726,798 121,792,752 8,876,730,613
1,567,094,336 10,209 962,104,787 7,797,600 207,098,786 91,267,248 19,547,968 2,854,920,934
1,520,306,827 10,032 829,289,509 307,097,286 230,927,282 14,872,145 2,902,503,081
23,022,448 12,864,094,347 495,775,237 222,795,000 33,151,946,067 633,123,001 10,609,368,928 568,719,716
50,000,000 24,685,891 2,815,613,743 5,049,423,501 190,226,327 29,430,070,630 511,202,630 10,609,368,928 482,139,079
9,188,934,474 1,735,973,111 24,917,353,505 23,925,320,165 322,451,390 4,876,099,654 5,324,980,064 1,665,538,184 458,385,000 425,816,327 6,448,076,571 4,978,103,389 632,796,658 510,876,287 184,271,166 72,988,099
552,715,404 253,524,385 59,375,084,533 68,460,980,936
557,137,056 195,333,849 49,915,201,634 58,791,932,247
99,317,055 106,061,020 24,734,463 14,455,744 47,601,300,346 38,311,231,980 50,456,221,280 41,213,735,061
6 8, 9, 10 10 10 11
6, 7 12 13 14 10 15 16 17 13.3 18 10, 19 10
The accompanying notes are an integral part of the financial statements.
Bangkok Dusit Medical Services Public Company Limited and its subsidiaries As at 31 December 2012
Statement of financial position (continued) Liabilities and shareholders' equity
(Unit: Baht)
Note
2012
2011
2012
2011
20 10
1,225,104,808 3,614,105,602 -
231,170,205 3,391,190,815 -
1,200,000,000 961,204,100 2,796,624,548
942,752,305 1,627,946,051
22
889,645,572
813,214,841
820,198,400
436,300,000
23
92,712,864 1,999,885,487 606,750,181 2,276,914,656 667,591,078 11,372,710,248
149,722,523 725,829,097 1,815,833,234 451,509,847 7,578,470,562
6,150,454 1,999,885,487 39,514,847 519,201,230 203,262,053 8,546,041,119
3,051,032 48,526,497 397,328,233 158,023,562 3,613,927,680
22
8,558,261,019
6,951,172,278
8,254,981,600
2,705,410,000
23
86,073,514 7,063,968,777 1,108,655,624 131,391,804 1,312,845,086 18,261,195,824 29,633,906,072
185,304,941 8,461,262,680 862,972,388 173,449,698 1,162,070,430 17,796,232,415 25,374,702,977
10, 21
34
34 24 10
The accompanying notes are an integral part of the financial statements.
11,436,066 6,927,699 7,063,968,777 8,461,262,680 212,524,251 148,516,084 74,862,285 108,620,182 192,004,068 106,791,206 15,809,777,047 11,537,527,851 24,355,818,166 15,151,455,531
Statement of financial position (continued)
Current liabilities Bank overdrafts and short-term loans from financial institutions Trade and other payables Short-term loans from related parties Current portion of long-term loans from financial institutions Current portion of liabilities under finance lease agreements Current portion of debentures Income tax payable Accrued expenses Other current liabilities Total current liabilities Non-current liabilities Long - term loans from financial insitutions - net of current portion Liabilities under finance lease agreement - net of current portion Debentures - net of current portion Provision for long-term employee benefits Deferred income Other non-current liabilities Total non-current liabilities Total liabilities
Separate financial statements
89 Annual Report 2012
Consolidated financial statements
Bangkok Dusit Medical Services Public Company Limited and its subsidiaries As at 31 December 2012
Statement of financial position (continued) Liabilities and shareholders' equity (continued)
Statement of financial position (continued)
Note
Annual Report 2012
90
Shareholders' equity 25 Share capital Registered 1,700,004,771 ordinary shares of Baht 1 each (2011: 1,553,391,408 ordinary shares of Baht 1 each) Issued and fully paid-up 1,545,458,883 ordinary shares of Baht 1 each Share premium Premium on ordinary shares Difference from shareholding restructure Retained earnings 27 Appropriated - statutory reserve Unappropriated Other components of shareholders' equity Equity attributable to owners of the Company Non - controlling interests of the subsidiaries Total shareholders' equity Total liabilities and shareholders' equity
Consolidated ďŹ nancial statements
(Unit: Baht)
Separate ďŹ nancial statements
2012
2011
2012
2011
1,700,004,771
1,553,391,408
1,700,004,771
1,553,391,408
1,545,458,883
1,545,458,883
1,545,458,883
1,545,458,883
20,022,497,644 305,000,325
20,022,497,644 305,000,325
19,959,573,716 19,959,573,716 -
170,000,477 15,081,806,199 170,748,104 37,295,511,632 1,531,563,232 38,827,074,864 68,460,980,936
155,339,141 9,003,545,079 963,350,808 31,995,191,880 1,422,037,390 33,417,229,270 58,791,932,247
170,000,477 155,339,141 3,433,450,234 2,516,503,383 991,919,804 1,885,404,407 26,100,403,114 26,062,279,530 26,100,403,114 26,062,279,530 50,456,221,280 41,213,735,061
The accompanying notes are an integral part of the ďŹ nancial statements.
Bangkok Dusit Medical Services Public Company Limited and its subsidiaries For the year ended 31 December 2012
Income statement 2012
Revenues Revenues from hospital operations 44,307,328,175 10 Other income 10 Revenue from sales of goods and foods 1,170,942,346 Interest income 56,501,930 Dividend income 16,564,227 12, 13, 14 Gain on fair value adjustment of investments 12.1, 13.3 1,795,048,116 Others 515,774,275 Total other income 3,554,830,894 Total revenues 47,862,159,069 Expenses Cost of hospital operations and goods sold 29,238,818,033 10 Administrative expenses 8,968,658,289 10 Total expenses 38,207,476,322 Profit before share of income from investments in associated companies, finance expenses and income tax 9,654,682,747 Share of income from investments in associated companies 967,663,398 12 Profit before finance expenses and income tax expenses 10,622,346,145 Finance expenses (849,405,902) 10 Profit before income tax expenses 9,772,940,243 Income tax expenses (1,520,706,466) 29, 35 Profit for the year 8,252,233,777 Profit attributable to: Equity holders of the Company 7,936,947,120 Non-controlling interests of the subsidiaries 315,286,657 8,252,233,777 Basic earnings per share 30 Profit attributable to equity holders of the Company 5.14 Weighted average number of ordinary shares (shares) 1,545,458,883 The accompanying notes are an integral part of the financial statements.
2011
2012
2011
35,224,466,182
10,001,426,497
8,258,839,349
1,009,460,204 63,051,703 103,527,505 479,028,410 491,804,455 2,146,872,277 37,371,338,459
47,620,553 42,371,398 202,430,001 71,717,388 2,155,163,968 1,979,139,621 449,760,125 407,838,566 2,854,974,647 2,501,066,973 12,856,401,144 10,759,906,322
23,675,485,850 7,224,190,229 30,899,676,079
6,369,648,903 2,839,790,823 9,209,439,726
5,479,336,126 2,302,468,571 7,781,804,697
6,471,662,380
3,646,961,418
2,978,101,625
381,645,368
-
-
6,853,307,748 (770,451,369) 6,082,856,379 (1,456,317,745) 4,626,538,634
3,646,961,418 (810,684,404) 2,836,277,014 (157,925,291) 2,678,351,723
2,978,101,625 (571,660,686) 2,406,440,939 (109,428,864) 2,297,012,075
4,385,987,305 240,551,329 4,626,538,634
2,678,351,723
2,297,012,075
3.00 1,461,915,619
1.73 1,545,458,883
1.57 1,461,915,619
Income statement
Note
(Unit: Baht)
Separate financial statements
91 Annual Report 2012
Consolidated financial statements
Bangkok Dusit Medical Services Public Company Limited and its subsidiaries For the year ended 31 December 2012
Statement of comprehensive income
Statement of comprehensive income
Annual Report 2012
92
Consolidated financial statements Note
2012
(Unit: Baht)
Separate financial statements
2011
2012
2011
4,626,538,634
2,678,351,723
2,297,012,075
1,372,437,827
4,506,245
1,372,272,360
(3,309,777) 8,985,000
(1,372,147,918) (46,747,333) 474,157,070
-
51,099,075
-
-
8,252,233,777 Profit for the year Other comprehensive income: Gain on change in value 4,796,669 of available-for-sale investments Reversal gain on change in value of available-for-sale investments due to transfer of investment from other long-term investment to 12.1 (1,372,147,918) investment in associated company 24 (131,630,157) Actuarial losses 16, 17 634,445,804 Gain on revaluation of land Exchange differences on translation of (34,518,057) financial statements in foreign currency Share of other comprehensive income from 114,186,053 associated companies (784,867,606) Other comprehensive income for the year
65,309,329 1,494,521,454
(940,231,936)
1,372,272,360
7,467,366,171
6,121,060,088
1,738,119,787
3,669,284,435
7,154,141,916 313,224,255 7,467,366,171
5,885,182,971 235,877,117 6,121,060,088
1,738,119,787
3,669,284,435
Total comprehensive income for the year Total comprehensive income attributable to: Equity holders of the Company Non-controlling interests of the subsidiaries
The accompanying notes are an integral part of the financial statements.
Bangkok Dusit Medical Services Public Company Limited and its subsidiaries For the year ended 31 December 2012
Statement of cash flows Cash flows from operating activities
Profit before income tax 9,772,940,243 Adjustments to reconcile profit before corporate income tax to net cash provided by (paid from) operating activities: Depreciation and amortisation expenses 2,950,574,134 Write-off of assets 19,699,358 Bad debts and allowance for doubtful accounts 108,788,432 Loss (reversal loss) on impairment of assets 1,914,699 Loss on deteriorated inventories 1,061,037 Amortisation of deferred income (42,057,894) Share of income from investments in associated companies (967,663,398) Negative goodwill Gain on fair value adjustment of investments (1,795,048,116) Amortisation of expense for convertible debentures, issued debentures and loan 3,361,984 Loss (gain) on disposal of property, premises and equipment 4,620,158 Gain on fair value adjustment of investment properties (17,876,855) Loss on liquidation of a subsidiary company Unrealised loss (gain) on foreign exchange Long-term employee benefit expenses 132,811,572 Interest income (56,501,930) Dividend income (16,564,227) Interest expense 849,405,902 Profit from operating activities before changes in operating assets and liabilities 10,949,465,099 The accompanying notes are an integral part of the financial statements.
2011
2012
2011
6,082,856,379
2,836,277,014
2,406,440,939
2,707,488,415 18,628,818 116,796,026 (13,083,042) 913,628 (43,745,508)
664,350,916 764,124 14,850,406 794,531 (33,757,897)
701,608,922 276,429 58,859,014 (12,333,020) 737,983 (37,492,080)
(381,645,368) (25,266,375) (479,028,410)
-
-
4,010,911
3,361,984
3,277,578
(9,915,912)
3,715,104
(2,552,500)
(1,045,000) 107,180,693 (63,051,703) (103,527,505) 770,451,369 8,688,017,416
(17,876,855) (18,069,000) 1,031,853 14,055,135 (12,870,015) 22,484,630 22,241,974 (202,430,001) (71,717,388) (2,155,163,968) (1,979,139,621) 810,684,404 571,660,686 1,962,109,527
1,631,961,754
Statement of cash flows
2012
(Unit: Baht)
Separate financial statements
93 Annual Report 2012
Consolidated financial statements
Bangkok Dusit Medical Services Public Company Limited and its subsidiaries For the year ended 31 December 2012
Statement of cash flows (continued) Cash flows from operating activities (continued)
(Unit: Baht)
Consolidated financial statements
Statement of cash flows (continued)
2012
Annual Report 2012
94
Decrease (increase) in operating assets Trade and other receivables (1,017,021,032) Inventories 256,783,484 Other current assets (28,545,237) Other non-current assets (55,511,843) Increase (decrease) in operating liabilities Trade and other payables (111,254,687) Accrued expenses 478,385,266 Other current liabilities 216,081,232 Provision for long-term employee benefits (18,758,494) Other non-current liabilities 150,774,655 Net cash from operating activities 10,820,398,443 Cash received from interest incomes 42,783,342 Cash paid for interest expenses (779,629,930) Cash received from tax refund 25,059,813 Cash paid for corporate income tax (1,699,131,065) Net cash from operating activities 8,409,480,603 Cash flows from investing activities Decrease (increase) in short-term investments 196,888,215 Decrease in restricted financial institution deposits 1,663,443 Decrease in long-term financial institution deposits 50,000,000 Dividend received 280,599,833 Interest received from investment 11,999,118 Cash paid for purchase of investments in subsidiaries, associates and other company (4,266,954,772) Cash received from refunding capital of a subsidiary company Cash received from disposal of dued other long-term investment Cash paid for investment property (19,620,675) Cash received from disposal of property, premises and equipment 37,051,249 Cash paid for purchase of property, premises and equipment (5,791,020,424) Cash paid for leasehold rights (17,280,536) Increase in short-term loans to related parties Increase in long-term loans to related parties Cash received from long-term loans to related parties Cash paid for purchase of intangible assets (198,978,746) Net cash used in investing activities (9,715,653,295) The accompanying notes are an integral part of the financial statements.
2011
Separate financial statements 2012
2011
(714,466,815) (482,018,260) 105,300,148 (35,341,337)
(134,327,592) 138,865,503 (4,675,823) (8,677,347)
(331,495,962) (173,832,564) 59,850,137 (351,887)
625,615,414 151,864,550 (87,604,617) (23,122,000) 49,562,945 8,277,807,444 62,891,993 (737,131,245) 15,041,752 (1,423,883,387) 6,194,726,557
(54,830,925) 120,654,607 45,238,490 (5,223,796) 85,212,862 2,144,345,506 187,557,719 (757,011,458) (167,851,367) 1,407,040,400
180,733,708 17,448,294 25,503,007 (6,353,393) 13,020,475 1,416,483,569 70,192,988 (555,288,206) (69,068,435) 862,319,916
1,539,710,529 61,067,509 166,639,607 15,111,753
(177) 2,147,366,368 1,534,191
1,739,532,850 1,979,139,621 15,111,753
(2,188,039,086) -
(5,258,988,113) -
(4,607,666,211) 258,968,147
500,000,000 (135,177,289)
(19,620,675)
500,000,000 (135,177,289)
18,300,692 (3,559,683,668) (52,960,502) (140,325,399) (3,775,355,854)
16,203,628 (1,743,480,338) (83,639,987) (4,173,846,818) 683,988,290 (125,534,806) (8,556,018,437)
5,725,129 (762,812,347) (52,960,502) (164,527,385) (1,010,593,176) 641,837,422 (9,472,731) (1,602,894,719)
Bangkok Dusit Medical Services Public Company Limited and its subsidiaries For the year ended 31 December 2012
Statement of cash flows (continued) (Unit: Baht)
Consolidated financial statements
Separate financial statements
2012
2011
2012
2011
-
-
1,168,678,497
988,344,818
Cash received from bank overdraft and short-term loans 9,150,000,000
4,401,208,517
9,150,000,000
4,200,000,000
(8,155,066,935)
(4,209,929,219)
(7,950,000,000)
(4,200,000,000)
Cash received from long-term loans from financial institutions
6,617,777,800
4,616,390,400
6,617,777,800
1,021,610,000
Repayment of long-term loans from financial institutions
(4,930,611,323)
(5,019,926,849)
(684,307,800)
(343,800,000)
Repayments of liabilities under finance lease agreements
(209,638,666)
(137,403,367)
(5,616,348)
(2,154,273)
Cash received from issue of debentures
599,229,600
3,494,818,102
599,229,600
3,494,818,102
from financial instititons Repayment of bank overdraft and short-term loans from financial instititons
Cash paid for redemption of debentures
-
(3,000,000,000)
-
(131,467,725)
-
9,717,108
-
(3,000,000,000)
Cash paid for investment in subsidiary companies from non - controlling interests Net cash received from issuing ordinary shares
(266,547,297) -
9,717,108
(1,699,996,203)
(989,912,836)
(85,132,092)
(66,586,442)
Net cash from (used in) financing activities
1,020,014,884
(1,033,092,311)
7,195,765,546
1,178,622,919
Net increase (decrease) in cash and cash equivalents
(286,157,808)
1,386,278,392
46,787,509
438,048,116
Cash and cash equivalents at beginning of year
3,875,733,420
2,489,455,028
1,520,306,827
1,082,258,711
Cash and cash equivalents at end of year
3,589,575,612
3,875,733,420
1,567,094,336
1,520,306,827
Dividend paid Dividend paid by subsidiaries to non - controlling interests
-
(1,699,996,203) -
(989,912,836) -
-
Supplemental cash flows information: Non-cash items: Assets acquired under finance lease agreements
33,715,736
90,571,481
12,479,609
11,159,376
185,539,074
48,301,606
10,676,268
25,939,443
Increase in accounts payable - property, premises and equipment Decrease in accounts payable - investment property Increase (decrease) in payable to construction retention Dividend receivable
(7,613,155) 106,149,426 11,268,600
166,135,869 -
(7,613,155) 17,291,190 7,797,600
(13,722,006) -
Acquire investments in subsidiary companies by issuing shares
-
The accompanying notes are an integral part of the financial statements.
13,321,247,595
-
13,321,247,595
95 Annual Report 2012
Increase in short-term loans from related parties
Statement of cash flows (continued)
Cash flows from financing activities
Bangkok Dusit Medical Services Public Company Limited and its subsidiaries For the year ended 31 December 2012
Statement of changes in shareholders' equity
Statement of changes in shareholders' equity
Retained earnings
Annual Report 2012
96
Issued and paid-up share capital
Surplus (deficit) on changes in value of available-for-sale investments
Appropriatedstatutory reserve
Unappropriated
131,226,422
5,161,968,125
-
-
(517,149,736)
-
-
24,112,719 -
(24,112,719) 4,385,987,305 (3,147,896) 4,382,839,409
1,372,433,095 1,372,433,095
-
-
-
-
1,545,458,883 20,022,497,644 305,000,325
155,339,141
9,003,545,079
1,372,254,087
1,545,458,883 20,022,497,644 305,000,325 Balance as at 31 December 2011 Dividend paid (Note 26) Statutory reserve (Note 27) Profit for the year Other comprehensive income for the year Total comprehensive income for the year Share of Interest paid for convertible bonds treated as equity securities from an associated company Change in non-controlling interests of subsidiaries from purchase investment in subsidiaries Decrease in non-controlling interests of subsidiaries from dividend of subsidiaries 1,545,458,883 20,022,497,644 305,000,325 Balance as at 31 December 2012
155,339,141 14,661,336 -
9,003,545,079 (1,699,996,203) (14,661,336) 7,936,947,120 (144,028,461) 7,792,918,659
1,372,254,087 (1,367,356,128) (1,367,356,128)
-
-
-
-
-
-
170,000,477
15,081,806,199
Balance as at 31 December 2010 Cumulative effect of change in accounting policy for employee benefits Acquire investments in subsidiary companies by issuing shares (Note 25) Issue of share capital (Note 25) Conversion of convertible debentures Statutory reserve (Note 27) Profit for the year Other comprehensive income for the year Total comprehensive income for the year Change in non-controlling interests of subsidiaries from purchase investment in subsidiaries Decrease in non-controlling interests of subsidiaries from dividend of subsidiaries Balance as at 31 December 2011
1,246,035,935 -
Premium on ordinary shares
Difference from shareholding restructure
6,988,760,633 305,000,325 -
295,236,682 12,879,901,154 151,699,002 4,127,864 2,136,855 58,402 -
-
The accompanying notes are an integral part of the financial statements.
(179,008)
4,897,959
(Unit: Baht)
Consolidated financial statements Equity attributable to owners of the Company
Convertible debentures equity component
Share of other components of shareholders' equity from associated company
1,949,627,079
(168,801,173)
20,187
20,834,275
-
-
-
58,745,231 58,745,231
-
Excess of investment over book value of subsidiary companies
Equity attributable to non-controlling interest of the subsidiaries
Total shareholders' equity
Total other components of shareholders' equity
Total equity attributable to owners of the Company
-
1,801,501,360
15,634,492,800
648,411,734
16,282,904,534
-
-
-
(517,149,736)
(19,303,550)
(536,453,286)
(20,187) -
65,309,329 65,309,329
-
(20,187) 1,502,343,562 1,502,343,562
13,175,137,836 155,826,866 2,175,070 4,385,987,305 1,499,195,666 5,885,182,971
13,175,137,836 155,826,866 2,175,070 240,551,329 4,626,538,634 (4,674,212) 1,494,521,454 235,877,117 6,121,060,088
-
-
-
(2,340,473,927)
(2,340,473,927)
(2,340,473,927)
623,638,531
1,955,482,986
(110,055,942)
-
86,143,604
(2,340,473,927)
963,350,808
31,995,191,880
(66,586,442) (66,586,442) 1,422,037,390 33,417,229,270
1,955,482,986 632,633,745 632,633,745
(110,055,942) (34,410,371) (34,410,371)
-
86,143,604 130,356,011 130,356,011
(2,340,473,927) -
963,350,808 (638,776,743) (638,776,743)
31,995,191,880 (1,699,996,203) 7,936,947,120 (782,805,204) 7,154,141,916
1,422,037,390 17,134,324,736 (1,699,996,203) 315,286,657 8,252,233,777 (2,062,402) (784,867,606) 313,224,255 7,467,366,171
-
-
-
(5,847,717)
-
(5,847,717)
(5,847,717)
-
-
-
-
(147,978,244)
(147,978,244)
(147,978,244)
2,588,116,731
(144,466,313)
-
210,651,898
(2,488,452,171)
170,748,104
37,295,511,632
5,855,907 5,855,907
(118,566,321)
(1,716,835,396)
(5,847,717) (266,544,565)
(85,132,092) (85,132,092) 1,531,563,232 22,544,170,330
97 Annual Report 2012
Revaluation surplus on land
Exchange differences on translation of financial statements in foreign currency
Statement of changes in shareholders' equity
Other components of shareholders’ equity
Bangkok Dusit Medical Services Public Company Limited and its subsidiaries For the year ended 31 December 2012
Statement of changes in shareholders' equity
Statement of changes in shareholders' equity (continued)
(continued)
Annual Report 2012
98
Retained earnings Issued and paid-up share capital
Premium on ordinary shares
Appropriatedstatutory reserve
Unappropriated
Balance as at 31 December 2010 Cumulative effect of change in accounting policy for employee benefits Cumulative effect of change in accounting policy for investment property Acquire investments in subsidiary companies by issuing shares (Note 25) Issue of share capital (Note 25) Conversion of convertible debentures Statutory reserve (Note 27) Profit for the year Other comprehensive income for the year Total comprehensive income for the year Balance as at 31 December 2011
1,246,035,935
6,925,836,705
131,226,422
186,554,761
-
-
-
(158,120,879)
-
-
-
215,170,145
295,236,682 4,127,864 58,402 1,545,458,883
12,879,901,154 151,699,002 2,136,855 19,959,573,716
24,112,719 155,339,141
(24,112,719) 2,297,012,075 2,297,012,075 2,516,503,383
Balance as at 31 December 2011 Dividend paid (Note 26) Statutory reserve (Note 27) Profit for the year Other comprehensive income for the year Total comprehensive income for the year Balance as at 31 December 2012
1,545,458,883 1,545,458,883
19,959,573,716 19,959,573,716
155,339,141 14,661,336 170,000,477
2,516,503,383 (1,699,996,203) (14,661,336) 2,678,351,723 (46,747,333) 2,631,604,390 3,433,450,234
The accompanying notes are an integral part of the financial statements.
(Unit: Baht)
Revaluation surplus on land
Convertible debentures equity component
Total other components of shareholders' equity
Total shareholders' equity
728,481,200
20,187
728,322,379
9,217,976,202
-
-
-
-
(158,120,879)
-
(215,170,145)
-
(215,170,145)
-
1,372,272,360 1,372,272,360 1,372,093,352
513,311,055
(20,187) -
(20,187) 1,372,272,360 1,372,272,360 1,885,404,407
13,175,137,836 155,826,866 2,175,070 2,297,012,075 1,372,272,360 3,669,284,435 26,062,279,530
1,372,093,352 (1,367,641,673) (1,367,641,673) 4,451,679
513,311,055 474,157,070 474,157,070 987,468,125
-
1,885,404,407 (893,484,603) (893,484,603) 991,919,804
26,062,279,530 (1,699,996,203) 2,678,351,723 (940,231,936) 1,738,119,787 26,100,403,114
Surplus (deficit) on changes in value of available-for-sale investments (179,008)
99 Annual Report 2012
Other components of shareholders’ equity
Statement of changes in shareholders' equity (continued)
Separate financial statements
Bangkok Dusit Medical Services Public Company Limited and its subsidiaries For the year ended 31 December 2012
Notes to consolidated financial statements
Notes to consolidated financial statements
Annual Report 2012
100
1. General information
Bangkok Dusit Medical Services Public Company Limited ("the Company") is a public company under Thai laws and domiciled in Thailand. The Company is principally engaged in the hospital business. The registered office of the Company is at 2, Soi Soonvijai 7, New Petchburi Road, Bang Kapi, Huaykwang, Bangkok.
2. Basis of preparation
2.1 The financial statements have been prepared in accordance with accounting standards enunciated under the Accounting Profession Act B.E. 2547 and their presentation has been made in compliance with the stipulations of the Notification of the Department of Business Development dated 28 September 2011, issued under the Accounting Act B.E. 2543. The financial statements in Thai language are the official statutory financial statements of the Company. The financial statements in English language have been translated from the Thai language financial statements. The financial statements have been prepared on a historical cost basis except where otherwise disclosed in the accounting policies. 2.2 Basis of consolidation a) The consolidated financial statements include the financial of Bangkok Dusit Medical Services Public Company Limited (“the Company”) and the following subsidiaries (“the subsidiaries”) as follows: Company’s name
Nature of business
Registered capital 2012
2011
Percentage of shareholding by the Company (percent) 2012
2011
Held by the Company Baht 1,000 million Baht 1,000 million
95.76
95.76
Baht 500 million
Baht 500 million
98.79
98.78
Hospital
Baht 500 million
Baht 500 million
99.68
99.68
BNH Medical Center Co., Ltd.
Hospital
Baht 586 million
Baht 586 million
91.48
91.48
Bangkok Phrapradaeng Hospital Co., Ltd.
Hospital
Baht 105 million
Baht 105 million
79.00
79.00
Bangkok Pattaya Hospital Co., Ltd.
Hospital
Baht 280 million
Baht 280 million
97.27
97.22
Bangkok Rayong Hospital Co., Ltd.
Hospital
Baht 400 million
Baht 400 million
100.00
100.00
Bangkok Samui Hospital Co., Ltd.
Hospital
Baht 150 million
Baht 150 million
100.00
100.00
Bangkok Trat Hospital Co., Ltd.
Hospital
Baht 250 million
Baht 250 million
99.76
99.76
Wattanavej Co., Ltd.
Hospital
Baht 180 million
Baht 180 million
99.69
99.69
Bangkok Ratchasima Hospital Co., Ltd.
Hospital
Baht 300 million
Baht 300 million
90.36
89.73
National Healthcare Systems Co., Ltd.
Central lab
Baht 75 million
Baht 75 million
74.02
74.02
Central lab
Baht 10 million
Baht 10 million
95.00
95.00
Angkor Pisith Co., Ltd.
Hospital
USD 10 million
USD 10 million
80.00
80.00
Phnom Penh Medical Services Co., Ltd.
Hospital
USD 10 million
USD 10 million
100.00
100.00
Samitivej Public Co., Ltd.
Hospital
Bangkok Hospital Hatyai Co., Ltd.
Hospital
Bangkok Phuket Hospital Co., Ltd.
Bio Molecular Laboratories (Thailand) Co., Ltd.
Registered capital 2012
2011
Percentage of shareholding by the Company (percent) 2012
2011
70.00
70.00
Held by the Company (continued) Royal Rattanak Medical Services Co., Ltd.
Hospital
B.D.M.S. International Medical Services Co., Ltd.
Hospital
Asia International Healthcare Co., Ltd. New Petchburi Medical Services Co., Ltd.
Riel 26,000 million Riel 26,000 million Riel 9,200 million
Riel 9,200 million
100.00
100.00
Investment
Baht 35 million
Baht 35 million
100.00
100.00
Dormant
Baht 1 million
Baht 1 million
100.00
100.00
Bangkok Health Insurance Limited
Health insurance
Baht 105 million
Baht 105 million
99.94
99.94
Royal Bangkok Healthcare Co., Ltd.
Management service
Baht 736 million
Baht 736 million
100.00
100.00
Greenline Synergy Co., Ltd.
Technology and information service
Baht 200 million
Baht 200 million
100.00
100.00
Hospital
Baht 70 million
Baht 70 million
100.00
100.00
Training business
Baht 1 million
Baht 1 million
100.00
100.00
Investment
Baht 1,108 million
Baht 2,341 million
98.32
97.14
Paolo Medic Co., Ltd.
Hospital
Baht 300 million
Baht 300 million
100.00
100.00
Paolo Samutprakarn Co., Ltd.
Hospital
Baht 42 million
Baht 42 million
93.30
88.73
Siam Medical Co., Ltd.
Hospital
Baht 100 million
Baht 100 million
85.69
80.72
Thai Medical Center Public Co., Ltd.
Hospital
Baht 201 million
Baht 201 million
99.76
99.76
Baht 20 million
Baht 4 million
100.00
100.00
Bangkok Hospital Kao Yai Co., Ltd. BDMS Training Co., Ltd. Prasit Patana Public Co., Ltd.
Bangkok Premier Life Insurance Broker Co., Ltd. Life insurance broker Bangkok Hospital Chiangmai Co., Ltd.
Hospital
Baht 250 million
-
100.00
-
Bangkok Hospital Udon Co., Ltd.
Hospital
Baht 500 million
-
100.00
-
Central lab
Baht 75 million
Baht 75 million
25.97
25.97
Samitivej Sriracha Co., Ltd.
Hospital
Baht 188 million
Baht 188 million
68.06
68.06
Irving Sheridan SE Co., Ltd.
Assets management for healthcare business
Baht 0.1 million
Baht 0.1 million
96.03
96.03
Restaurant and distribution of health food products and facility management
Baht 14 million
Baht 14 million
100.00
100.00
Sodexo Healthcare Support Services (Thailand) Co., Ltd.
Restaurant and distribution of health food products
Baht 15 million
Baht 15 million
74.00
74.00
Phuket Health And Travel Co., Ltd. (liquidated in 2012)
Healthcare travel service
-
Baht 5 million
-
100.00
A.N.B. Laboratories Co., Ltd.
Manufacturer and distributor of medicine and pharmaceutical products
Baht 499 million
100.00
100.00
Held by the subsidiaries National Healthcare Systems Co., Ltd.
First Health Food Co., Ltd.
Baht 499 million
Notes to consolidated financial statements
Nature of business
101 Annual Report 2012
Company’s name
Notes to consolidated financial statements
All subsidiaries incorporated in Thailand except B.D.M.S. International Medical Services Co., Ltd., Angkor Pisith Co., Ltd., Phnom Penh Medical Services Co., Ltd. and Royal Rattanak Medical Services Co., Ltd. which were incorporated in Cambodia.
Annual Report 2012
102
b) Subsidiaries are fully consolidated, being the date on which the Company obtains control, and continue to be consolidated until the date when such control ceases. c) The financial statements of the subsidiaries are prepared using the same significant accounting policies as the Company. d) The assets and liabilities in the financial statements of overseas subsidiary companies are translated to Baht using the exchange rate prevailing on the end of reporting period, and revenues and expenses translated using monthly average exchange rates. The resulting differences are shown under the caption of “Exchange differences on translation of financial statements in foreign currency” in the statements of changes in shareholders’ equity. e) Material balances and transactions between the Company and its subsidiaries have been eliminated from the consolidated financial statements. f) Non-controlling interests represent the portion of profit or loss and net assets of the subsidiaries that are not held by the Company and are presented separately in the consolidated profit or loss and within equity in the consolidated statement of financial position. 2.3 The separate financial statements, which present investments in subsidiaries and associates under the cost method, have been prepared solely for the benefit of the public.
3. New accounting standards not yet effective
The Federation of Accounting Professions issued the following new/revised accounting standards that are effective for fiscal years beginning on or after 1 January 2013. Accounting standards: TAS 12 TAS 20 (revised 2009) TAS 21 (revised 2009) Financial Reporting Standard: TFRS 8 Accounting Standard Interpretations: SIC 10 SIC 21 SIC 25
Income Taxes Accounting for Government Grants and Disclosure of Government Assistance The Effects of Changes in Foreign Exchange Rates Operating Segments Government Assistance - No Specific Relation to Operating Activities Income Taxes - Recovery of Revalued Non-Depreciable Assets Income Taxes - Changes in the Tax Status of an Entity or its Shareholders
The Company’s management believes that TAS 20 (revised 2009), SIC 10, SIC 21 and SIC 25 are not relevant to the business of the Company; TAS 21 (revised 2009) and TFRS 8 will not have any significant impact on the financial statements for the year when there are initially applied, while TAS 12 will have impact on the financial statements as below. TAS 12 Income Taxes This accounting standard requires an entity to identify temporary differences, which are differences between the carrying amount of an asset or liability in the accounting records and its tax base, and to recognise deferred tax assets and liabilities under the stipulated guidelines. The effect of the adoption of this accounting standard in 2013 to the financial statements of the Company and its subsidiaries are as follows:
Consolidated financial statements
215 (519)
2 (198)
19
(8)
194
180
Statement of financial position As at 31 December 2012 Increase in unappropriated retained earnings Decrease in other components of shareholders' equity Income statement Increase (decrease) in profit for the year 2012 Statements of comprehensive income Increase in other comprehensive income for 2012
In addition, the Federation of Accounting Professions has issued Notification No. 30/2012 - 34/2012, published in the Royal Gazette on 17 January 2013, mandating the use of accounting treatment guidance and accounting standard interpretations as follows: Effective date Accounting Treatment Guidance for Transfers of Financial Assets Accounting Standard Interpretation: SIC 29 Service Concession Arrangements: Disclosures Financial Reporting Standard Interpretations: TFRIC 4 Determining whether an Arrangement contains a Lease TFRIC 12 Service Concession Arrangements TFRIC 13 Customer Loyalty Programmes
1 January 2013 1 January 2014 1 January 2014 1 January 2014 1 January 2014
The management of the Company has assessed the effect of these standards and believes that Accounting Treatment Guidance for Transfers of Financial Assets, SIC 29, TFRIC 4 and TFRIC 12 are not relevant to the business of the Company. Management is still evaluating the first-year impact to the financial statements of the adoption of TFRIC 13 and has yet to reach a conclusion.
4. Significant accounting policies
4.1 Revenue recognition Hospital operations Revenues from hospital operations, mainly consisting of medical fees, hospital room sales and medicine sales, are recognised as income when services have been rendered or medicine delivered. Revenue from sales of goods and foods Sales of goods and foods are recognised when the significant risks and rewards of ownership of the goods have passed to the buyer. Sales are the invoiced value, excluding value added tax, of goods and food supplied after deducting discounts. Service income Service income is recognised when services have been rendered.
103 Annual Report 2012
Consolidated financial statements
Notes to consolidated financial statements
(Unit: Million Baht)
Notes to consolidated financial statements Annual Report 2012
104
Membership income Membership income is cash receipt from sales of membership cards which initially recorded as deferred income and gradually amortised to income over membership period. For cash received in advance from the Life Privilege membership program is amortised to income over a period of 10 years. Interest income Interest income is recognised on an accrual basis based on the effective rate. Dividends Dividends are recognised when the right to receive the dividends is established. 4.2 Cash and cash equivalents Cash and cash equivalents consist of cash in hand and cash at financial institutions and highly liquid investment with an original maturity of 3 months or less and not subject to withdrawal restrictions. 4.3 Trade accounts receivable and allowance for doubtful accounts Trade accounts receivable are stated at the net realisable value. Allowance for doubtful accounts is provided for the estimated losses that may be incurred in collection of receivables. The allowance is generally based on collection experiences and analysis of debt aging. 4.4 Inventories Inventories are valued at lower of cost (weighted average basis) or net realisable value. Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs necessary to make the sale. 4.5 Investments a) Investments in securities held for trading are stated at fair value. Changes in the fair value of these securities are recorded in profit or loss. b) Investments in available-for-sale securities are stated at fair value. Changes in the fair value of these securities are recorded as a separate item in shareholders’ equity, and will be recorded in profit or loss when the securities are sold. c) Investments in debt securities, both due within one year and expected to be held to maturity, are recorded at amortised cost. The premium/discount on debt securities is amortised/accreted by the effective rate method with the amortised/ accreted amount presented as an adjustment to the interest income. d) Investments in non-marketable equity securities, which the Company classifies as other investments, are stated at cost net of allowance for loss on diminution in value (if any). e) Investments in associates are accounted for in the consolidated financial statements using the equity method. f) Investments in subsidiaries and associates are accounted for in the separate financial statements using the cost method. The fair value of marketable securities is based on the latest bid price of the last working day of the year. 4.6 Property, premises and equipment/Depreciation Land is stated at revalued amount. Buildings and equipment are stated at cost less accumulated depreciation and allowance for loss on impairment of assets (if any).
- When an asset’s carrying amount is decreased as a result of a revaluation of the Company and its subsidiaries’ assets, the decrease is recognised in profit or loss However, the revaluation decrease is charged to the other comprehensive income to the extent that it does not exceed an amount already held in “Revaluation surplus on land” in respect of the same asset. Depreciation of premises and equipment is calculated by reference to their cost on a straight-line basis over the following estimated useful lives: Land improvements Building, structures and building improvements Medical tools and equipment and machines Structure equipment, furniture and office equipment Vehicles
5 - 20 years 5 - 40 years 3 - 10 years 3 - 15 years 5 - 8 years
Depreciation attributed to the original cost portion is included in determining income. No depreciation is provided on land and fixed assets under construction and installation. An item of property, premises and equipment is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on disposal of an asset is included in profit or loss when the asset is derecognised. 4.7 Intangible assets Intangible assets acquired through business combination are initially recognised at their fair value on the date of business acquisition while intangible assets acquired in other cases are recognised at cost. Following the initial recognition, the intangible assets are carried at cost less any accumulated amortisation and any accumulated impairment losses (if any). Intangible assets with finite lives are amortised on a systematic basis over the economic useful life and tested for impairment whenever there is an indication that the intangible asset may be impaired. The amortisation period and the amortisation method of such intangible assets are reviewed at least at each financial year end. The amortisation expense is charged to profit or loss.
105 Annual Report 2012
Differences arising from the revaluation are dealt with in the financial statements as follows: - When an asset’s carrying amount is increased as a result of a revaluation of the Company and its subsidiaries’ assets, the increase is credited directly to equity under the heading of “Revaluation surplus on land”. However, a revaluation increase will be recognised as income to the extent that it reverses a revaluation decrease of the same asset previously recognised as an expense.
Notes to consolidated financial statements
Land initially recorded at cost on the acquisition date, and subsequently revalued by an independent professional appraiser to its fair values. Revaluations are made with sufficient regularity to ensure that the carrying amount does not differ materially from fair value at the end of reporting period.
Notes to consolidated financial statements
The intangible asset with finite useful lives is as follow: Computer software 5 - 10 years
Annual Report 2012
106
4.8 Goodwill / Business combination Business combinations are accounted for using the acquisition method with the cost of the acquisition being the fair value at the acquisition date of consideration transferred, and the amount of any non-controlling interest in the acquiree. For each business combination, the acquirer measures the non-controlling interest, if any, in the acquiree either at fair value or at the proportionate share of the acquiree’s identifiable net assets. Acquisition-related costs are accounted for as expenses in the periods in which the costs are incurred and the services are received. Goodwill is initially recorded at cost, which equals to the excess of cost of business combination over the fair value of the net assets acquired. If the fair value of the net assets acquired exceeds the cost of business combination, the excess is immediately recognised as gain in profit or loss. Goodwill is carried at cost less any accumulated impairment losses. Goodwill is tested for impairment annually and when circumstances indicate that the carrying value may be impaired. For the purpose of impairment testing, goodwill acquired in a business combination is allocated to each of the Company’s cash generating units (or group of cash-generating units) that are expected to benefit from the synergies of the combination. The Company estimates the recoverable amount of each cash-generating unit (or group of cash-generating units) to which the goodwill relates. Where the recoverable amount of the cash-generating unit is less than the carrying amount, an impairment loss is recognised in profit or loss. Impairment losses relating to goodwill cannot be reversed in future periods. 4.9 Related party transactions Related parties comprise enterprises and individuals that control or are controlled by the Company, whether directly or indirectly, or which are under common control with the Company. They also include associated companies and individuals which directly or indirectly own a voting interest in the Company that gives them significant influence over the Company, key management personnel, directors and officers with authority in the planning and direction of the Company’s operations. 4.10 Long-term rental agreements Leases of property, premises or equipment which transfer substantially all the risks and rewards of ownership are classified as finance leases. Finance leases are capitalised at the lower of the fair value of the leased assets and the present value of the minimum lease payments. The outstanding rental obligations, net of finance charges, are included in other long-term payables, while the interest element is charged to profit or loss over the lease period. The property, premises or equipment acquired under finance leases is depreciated over the useful life of the assets. 4.11 Operating leases Leases of assets where a significant portion of the risks and rewards of ownership is retained by the lessor are classified as operating leases. Payments made under operating leases are recognised as expenses in profit or loss on a straight line basis over the period of the lease.
In the assessment of asset impairment if there is any indication that previously recognised impairment losses may no longer exist or may have decreased, the Company and its subsidiaries estimate the asset’s recoverable amount. A previously recognised impairment loss is reversed only if there has been a change in the assumptions used to determine the asset’s recoverable amount since the last impairment loss was recognised. The increased carrying amount of the asset attributable to a reversal of an impairment loss shall not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in profit or loss unless the asset is carried at a revalued amount, in which case the reversal, which exceeds the carrying amount that would have been determined, is treated as a revaluation increase. 4.13 Leasehold rights Leasehold rights are amortised on the straight-line basis over the lease period. 4.14 Foreign currencies Transactions in foreign currencies are translated into Baht at the exchange rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated into Baht at the exchange rate ruling at the end of reporting period. Gains and losses on exchange are included in determining income. 4.15 Employee benefits Short-term employee benefits Salaries, wages, bonuses and contributions to the social security fund are recognised as expenses when incurred. Post-employment benefits Defined contribution plans The Company and its subsidiaries and its employees have jointly established a provident fund. The fund is monthly contributed by employees and by the Company and its subsidiaries. The fund’s assets are held in a separate trust fund and the Company’s and its subsidiaries contributions are recognised as expenses when incurred.
Notes to consolidated financial statements
An impairment loss is recognised in profit or loss. However in cases where property was previously revalued and the revaluation was taken to equity, a part of such impairment is recognised in equity up to the amount of the previous revaluation.
107 Annual Report 2012
4.12 Impairment of assets At the end of each reporting period, the Company and its subsidiaries perform impairment reviews in respect of the property, premises and equipment and other intangible assets whenever events or changes in circumstances indicate that an asset may be impaired. An impairment loss is recognised when the recoverable amount of an asset, which is the higher of the asset’s fair value less costs to sell and its value in use, is less than the carrying amount. In determining value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs to sell, an appropriate valuation model is used. These calculations are corroborated by a valuation model that, based on information available, reflects the amount that the Company and its subsidiaries could obtain from the disposal of the asset in an arm’s length transaction between knowledgeable, willing parties, after deducting the costs of disposal.
Notes to consolidated financial statements Annual Report 2012
108
Defined benefit plans The Company and its subsidiaries have obligations in respect of the severance payments it must make to employees upon retirement under labor law. The Company and its subsidiaries treat these severance payment obligations as a defined benefit plan. The obligation under the defined benefit plan and other long-term employee benefit plans is determined by a professionally qualified independent actuary based on actuarial techniques, using the projected unit credit method. Actuarial gains and losses arising from post-employment benefits are recognised immediately in other comprehensive income. For the first-time adoption of TAS 19 Employee Benefits, the Company and its subsidiaries elected to recognise the transitional liability, which exceeds the liability that would have been recognised at the same date under the previous accounting policy, through an adjustment to the beginning balance of retained earnings in 2011. Provisions for vacation The Company and its subsidiaries have set up provisions for vacation which is calculated in accordance with the Company’s and its subsidiaries' policy and formula, taking into consideration the employee's salary, the number of years of service and the unused vacation day. This provision has been adjusted annually. 4.16 Investment properties Investment properties are measured initially at cost, including transaction costs. Subsequent to initial recognition, investment properties are stated at fair value. Any gains or losses arising from changes in the value of investment properties are recognised in profit or loss when incurred. On disposal of investment properties, the difference between the net disposal proceeds and the carrying amount of the asset is recognised in profit or loss in the period when the asset is derecognised. 4.17 Financial instruments Financial assets carried on the statement of financial position included cash and cash equivalents, short-term investments, trade and other receivables, short-term loans and long-term loans to related parties, restricted financial institution deposits, and investments. Financial liabilities carried on the statement of financial position included bank overdrafts and short-term loans from financial institutions, trade and other payables, short-term loans from related parties, long-term loans, liabilities under finance leases, convertible debentures and debentures. The Company and its subsidiaries have no policy to hold any off-statement of financial position derivative financial instruments for speculative or trading purpose. 4.18 Income tax Income tax is provided in the accounts at the amount expected to be paid to the taxation authorities, based on taxable profits determined in accordance with tax legislation. 4.19 Borrowing costs Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalised as part of the cost of the
4.21 Interest rate swap contracts The net amount of interest to be received from or paid to the counterparty under an interest rate swap contract is recognised as income or expenses on an accrual basis.
5. Significant accounting judgments and estimates
The preparation of financial statements in conformity with generally accepted accounting principles at times requires management to make subjective judgments and estimates regarding matters that are inherently uncertain. These judgments and estimates affect reported amounts and disclosures and actual results could differ from these estimates. Significant judgments and estimates are as follows: Leases In determining whether a lease is to be classified as an operating lease or finance lease, the management is required to use judgment regarding whether significant risks and rewards of ownership of the leased asset have been transferred, taking into consideration terms and conditions of the arrangement. Allowance for doubtful accounts In determining allowances for doubtful accounts, the management needs to make judgment and estimates based upon, among other things, debt collection experience, the aging profile of outstanding debts and the prevailing economic conditions. Property, premises and equipment/Depreciation In determining depreciation of premises and equipment, the management is required to make estimates of the useful lives and residual values of the Company’s and its subsidiaries’ premises and equipment and to review estimate useful lives and residual values when there are any changes. The Company and its subsidiaries measure land at revalued amounts. Fair value from revaluation is determined by independent valuer using market approach. Such valuation is based on certain assumptions and estimates. In addition, the management is required to review property, premises and equipment for impairment on a periodical basis and record impairment losses in the period when it is determined that their recoverable amount is lower than the carrying amount. This requires judgements regarding forecast of future revenues and expenses relating to the assets subject to the review. Impairment of equity investments The Company and its subsidiaries treats available-for-sale investments and other investments as impaired when there has been a significant or prolonged decline in the fair value below their cost or where other objective evidence of impairment exists. The determination of what is “significant” or “prolonged” requires judgement of the management.
109 Annual Report 2012
4.20 Provisions Provisions are recognised when the Company and its subsidiaries have a present obligation as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.
Notes to consolidated financial statements
respective assets. All other borrowing costs are expensed in the period they are incurred. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds.
Notes to consolidated financial statements Annual Report 2012
110
Investment properties The Company and its subsidiaries present investment properties at the fair value estimated by an independent appraiser, and recognises changes in the fair value in profit or loss. The valuation involves certain assumptions and estimates. Goodwill and intangible assets The initial recognition and measurement of goodwill and other intangible assets, and subsequent impairment testing, require management to make estimates of cash flows to be generated by the asset or the cash generating unit and to choose a suitable discount rate in order to calculate the present value of those cash flows. Post-employment benefits under defined benefit plans The obligation under the defined benefit plan is determined based on actuarial techniques. Such determination is made based on various assumptions, including discount rate, future salary increase rate, mortality rate and staff turnover rate. Litigation The Company and its subsidiaries have contingent liabilities arising from litigation. The Company's management has used judgment to assess the outcome of the litigation. In cases of loss, the Company and its subsidiaries will record provision for contingent liabilities in their books of account. In cases where it has assessed that no damage will arise from the litigation, the Company and its subsidiaries will not record provision for contingent liabilities at the end of the reporting period.
6. Cash and cash equivalents
Cash and cash equivalents consist of the following: (Unit: Thousand Baht)
Cash and deposits at banks Fixed deposits, notes, and mutual funds Less: Fixed deposits, notes with maturities of more than 3 months (short-term investments) Restricted bank deposits Total cash and cash equivalents
Consolidated financial statements
Consolidated financial statements
2012
2011
2012
2011
3,138,217 742,149 3,880,366
3,346,104 1,018,681 4,364,785
1,567,094 10 1,567,104
1,520,307 10 1,520,317
(267,768) (23,022) 3,589,576
(464,366) (24,686) 3,875,733
(10)
(10)
1,567,094
1,520,307
As at 31 December 2012, bank deposits in saving accounts, fixed deposits and bills of exchange carried interests between 0.13 and 3.40 percent per annum (2011: between 0.50 and 3.90 percent per annum).
7. Restricted financial institutions deposits
These represent bank deposits that subsidiary companies have placed with banks to secure letters of guarantees issued by the banks on behalf of the subsidiary companies. These also represent bank deposits have placed with government agencies, state enterprise and private entities to guarantee contractual performance, among others and as escrow account.
8. Trade and other receivables
2012
2011
2012
2011
2,277 4,029,369 20,489 234,929 4,287,064
2,913 3,192,485 13,791 167,923 3,377,112
21,674 800,365 60,488 79,578 962,105
7,724 746,315 33,694 41,557 829,290
9. Trade accounts receivable
As at 31 December 2012 and 2011, the aging analysis of the outstanding trade accounts receivable is as follows: (Unit: Thousand Baht)
Related parties Less than 3 months 3 - 6 months 6 - 12 months Total trade accounts receivable - related parties Unrelated parties Less than 3 months 3 - 6 months 6 - 12 months over 12 months Total trade accounts receivable - unrelated parties Less: Allowance for doubtful accounts Total trade accounts receivable - unrelated parties - net Total trade accounts receivable -net
Consolidated financial statements
Separate financial statements
2012
2012
2011
2011
1,997 278 2 2,277
2,400 144 369 2,913
21,086 570 18 21,674
7,538 180 6 7,724
3,374,010 500,470 238,351 224,223 4,337,054 (307,685) 4,029,369 4,031,646
2,613,130 400,660 245,702 233,893 3,493,385 (300,900) 3,192,485 3,195,398
601,912 129,413 110,271 85,767 927,363 (126,998) 800,365 822,039
526,491 121,141 131,735 101,585 880,952 (134,637) 746,315 754,039
111 Annual Report 2012
Trade receivables - related parties Trade receivables - unrelated parties-net Other receivables - related parties Other receivables - unrelated parties Total trade and other receivables - net
Separate financial statements
Notes to consolidated financial statements
(Unit: Thousand Baht)
Consolidated financial statements
Notes to consolidated financial statements
10. Related party transactions
Annual Report 2012
112
The Company and its subsidiaries had significant business transactions with individuals or related parties, which have been concluded on commercial terms and bases agreed upon between the Company and those related parties. Below is a summary of those transactions. Transaction
Pricing and lending policy
Revenue from hospital operation and lab services Revenue and expenses from consulting and management Rental income and rental expenses Interest charge of inter-company loan Purchases and sales of fixed assets Purchases of investments
Based on the price charged to normal customers Rates as stipulated in agreements Rates as stipulated in agreements Interest rate close to that charged by commercial banks Prices are dependent on the condition of fixed assets The same prices as purchases from unrelated parties
The significant intercompany transactions are as follows:
(Unit: Million Baht)
For the years ended 31 December
Associated companies Revenue from hospital operations and lab services Dividend income (Note 12) Other income Service cost Other expenses Dividend payment Subsidiary companies Revenue from hospital operations and lab services Consulting and management fee income Interest income Dividend income (Note 13) Other income Service cost Consulting and management fee expenses Other expenses Interest expenses Sales of medical equipment and vehicle
Consolidated financial statements
Separate financial statements
2012
2011
2012
10.0 32.3 157.9 0.8 0.6
3.2 26.2 99.2 1.8 -
5.0 268.2 0.1 83.3 0.6
1.1 61.8 0.2 36.7 -
-
-
92.1 293.7 190.3 1,874.1 36.1 485.8 207.4 151.2 70.0 -
40.2 236.8 55.2 1,818.2 37.3 367.9 206.2 153.1 36.6 1.2
2011
(Unit: Million Baht)
Separate financial statements
2012
2011
2012
2011
3.6 8.0 11.7 2.5 8.9 134.2
4.7 11.0 10.5 14.9 5.8 -
1.3 8.0 0.1 0.9 1.0 134.2
1.9 11.0 13.6 0.1 -
The outstanding balances of the above transactions as at 31 December 2012 and 2011 have been separately shown in the statement of financial position as follows: (Unit: Thousand Baht)
Trade accounts receivable - related parties Associated companies Subsidiary companies Related companies Total trade accounts receivable - related parties Dividend receivable - related parties An associated company A related company Total dividend receivable - related parties Other accounts receivable - related parties Consulting and management fee receivable Subsidiary companies Total Others Associated companies Subsidiary companies Related companies Total Total other accounts receivable - related parties
Consolidated financial statements
Separate financial statements
2012
2011
2012
2011
1,601 676 2,277
894 2,019 2,913
630 20,905 139 21,674
6,617 1,107 7,724
3,471 7,798 11,269
-
7,798 7,798
-
-
-
30,612 30,612
22,491 22,491
17,451 3,038 20,489 20,489
8,484 5,307 13,791 13,791
5 29,842 29 29,876 60,488
11,203 11,203 33,694
113 Annual Report 2012
Individuals or related companies Revenue from hospital operations and lab services Dividend income (Note 14) Other income Service cost Other expenses Dividend payment
Consolidated financial statements
Notes to consolidated financial statements
For the years ended 31 December
Notes to consolidated financial statements
Consolidated ďŹ nancial statements 2012 2011
Annual Report 2012
114
Leasehold rights - related parties (included in other non-current assets) Associated companies Related parties Total leasehold rights - related parties Deposits and long-term prepaid expense - related parties (included in other non-current assets) Associated company Subsidiary companies Total deposits - related parties Trade accounts payable - related parties Associated companies Subsidiary companies Related companies Total trade accounts payable - related parties Other accounts payable - related parties Associated companies Subsidiary companies Related companies Total other accounts payable - related parties Deposits - related parties (included in other non-current liabilities) Associated company Subsidiary companies Total deposits - related parties
274,062 78,576 352,638
272,672 85,708 358,380
2,700 2,700
(Unit: Thousand Baht)
Separate ďŹ nancial statements 2012 2011 -
-
2,700 2,700
2,700 6,029 8,729
2,700 122 2,822
75,356 27 75,383
89,466 715 90,181
53,220 72,989 126,209
73,782 54,499 530 128,811
7,059 3,611 10,670
13,126 5,769 18,895
4 88,233 1,008 89,245
46,676 195 46,871
-
61 2,399 2,460
2,399 2,399
61 61
Movement of loans to and loans from related parties during the year are summarised as follows: (Unit: Thousand Baht)
Separate ďŹ nancial statements 31 December 2011 Short-term loans to related parties Subsidiary companies Total short-term loans to related parties Long-term loans to related parties Subsidiary companies Total long-term loans to related parties Short-term loans from related parties Subsidiary companies Total short-term loans from related parties
Increase
Decrease
31 December 2012
307,097 307,097
456,769 456,769
(556,767) (556,767)
207,099 207,099
1,665,538 1,665,538
4,173,847 4,173,847
(514,405) (514,405)
5,324,980 5,324,980
1,627,946 1,627,946
2,796,625 2,796,625
(1,627,946) (1,627,946)
2,796,625 2,796,625
The Subsidiaries A subsidiary company has entered into a Hospital Management Agreement with another subsidiary company, expiring on 28 May 2022. The subsidiary company is to receive management income at a certain percentage of total operation result as stipulated in the agreement. A subsidiary company has entered into a Hospital Management Agreement with its 4 subsidiary companies and other 4 subsidiary companies. The agreement is for 1 - 2.5 years and is entitled to renew. The subsidiary company shall receive management income at the rates stipulated in the agreement. The payment must be made on a monthly basis. A subsidiary company has entered into a Hospital Management Agreement with 3 subsidiary companies. The agreement is for 1 year and is entitled to renew. The subsidiary company shall receive management income at the rates stipulated in the agreement. The payment must be made on a monthly basis. Long term rental agreement The Company In May 2004, a subsidiary company entered into a three-year agreement to rent land from the Company for use in hospital operations whereby the subsidiary company has to pay a monthly rental fee at the rate stipulated in the agreement. Subsequently, the subsidiary extended the agreement to 30 April 2013. A subsidiary A subsidiary company entered into an agreement to rent land from another subsidiary company for construction of a building, expiring on 31 December 2015. The subsidiary company has to pay a monthly rental fee at the rate stipulated in the agreement. In addition, such another subsidiary company entered into an agreement to rent the building from a subsidiary company for its hospital operations, expiring on 30 April 2014. That subsidiary company has to pay a monthly rental fee at the rate stipulated in the agreement. Service and management agreement A subsidiary company has entered into service and management agreements with the Company and subsidiaries which have to pay monthly service and management fees to the subsidiaries at the rates stipulated in the agreements. A subsidiary company has entered into information technology management agreements with the Company and subsidiaries whereby have to pay monthly service fees to the subsidiary at the rate stipulated in the agreements.
Notes to consolidated financial statements
Management agreement The Company The Company provides hospital management services to its subsidiaries, for the remuneration rates are based on the net revenue from hospital operations.
115 Annual Report 2012
Short-term and long-term loans to related parties The Company has entered into short-term loan agreements and long-term loan agreements with terms of 3 - 8 years with its subsidiaries. The Company charged interest on loans to related parties at the Fixed Deposit Rate plus ďŹ xed rate per annum, LIBOR plus ďŹ xed rate per annum and MLR minus ďŹ xed rate per annum stipulated in the agreement payable on a monthly basis while principal is repayable on the basis stipulated in the agreements. As at 31 December 2012, the Company has outstanding short term and long term loans to subsidiaries totaling Baht 5,532.1 million (2011: Baht 1,972.6 million).
Notes to consolidated financial statements
A subsidiary company has entered into food providing and maintenance service agreements with the Company and subsidiaries whereby the Company and subsidiaries have to pay monthly service fee to the subsidiary at the rates stipulated in the agreements.
Annual Report 2012
116
A subsidiary company has entered into management agreements with another subsidiary company whereby it has to pay monthly service fees at the rate stipulated in the agreements Air ambulance service agreement Associated company On 1 September 2007, an associated company entered into an air ambulance service agreement with the Company. The agreement is for a period of 3 years from the date the service commenced and is renewable. The agreement stipulates the monthly minimum service fee that the associated company is to earn from the Company. The Company has extended the agreement for 25 months ended on 30 September 2015. Guarantee obligations with related parties The Company has guaranteed long-term loan amount of USD 3.1 million (2011: USD 3.6 million) and overdraft facility amounting to USD 0.8 million (2011: USD 1 million) for an overseas subsidiary company. A subsidiary company has guaranteed credit facility with financial institution amount of Baht 3.9 million for an associated company. Directors and management’s benefits During the year ended 31 December 2012 and 2011, the Company and its subsidiaries had benefits for their directors and management as below.
Short-term employee benefits Post-employment benefits Total
(Unit: Million Baht)
Consolidated financial statements
Separate financial statements
2012
2011
2012
2011
115.0 0.6 115.6
81.7 0.5 82.2
115.0 0.6 115.6
81.7 0.5 82.2
11. Inventories
Medicines and medical supplies Reagent Supplies and others Less: Provision for deteriorated inventories Total
(Unit: Thousand Baht)
Consolidated financial statements
Separate financial statements
2012
2011
2012
2011
672,814 71,834 37,854 782,502 (2,620) 779,882
904,876 84,825 49,584 1,039,285 (1,558) 1,037,727
93,063 93,063 (1,796) 91,267
231,928 231,928 (1,001) 230,927
12. Investments in associated companies % Share holding
Separate financial statements
Equity Method
Cost Method
2012
2011
2012
2011
2012
2011
Pharmaceuticals Baht 21.4 million 49.00
49.00
165,167
144,140
52,500
52,500
Associated companies held by the Company The Medic Pharma Co., Ltd. Cool & Joy Co., Ltd.
Production of television and radio program
Baht 5 million
30.00
30.00
1,069
1,069
1,500
1,500
S.R. Property Investment Co., Ltd.
Real estate
Riel 20 million
49.00
49.00
2,093
1,837
101
101
Siem Reap Land Investment Co., Ltd.
Real estate
Riel 20 million
49.00
49.00
1,764
1,529
101
101
Phnom Penh First Property Co., Ltd.
Real estate
Riel 20 million
49.00
49.00
3,532
2,947
88
88
Bangkok Helicopter Services Co., Ltd.
Service
Baht 100 million
49.00
49.00
34,977
38,134
50,859
50,859
Ramkhamhaeng Hospital Public Co., Ltd.
Hospital
Baht 120 million
38.24
38.24
2,835,589
2,329,480
1,459,800
1,459,800
Krungdhon Hospital Public Co., Ltd.
Hospital
Baht 150 million
20.01
20.01
104,179
107,865
101,072
101,072
Udon Pattana (1994) Co., Ltd. (held by the Company at 15.26% and indirectly held by subsidiary at 9.83% (2011: 9.71%))
Hospital
Baht 300 million
25.09
24.97
185,430
180,101
69,952
69,952
Bumrungrad Hospital Public Co., Ltd.
Hospital
Baht 730 million
23.88
-
9,523,489
-
7,452,961
-
12,857,289
2,807,102
9,188,934
1,735,973
Total investments in associated companies held by the Company
117
Associated companies held by the subsidiary companies Sodexo Support Services (Thailand) Co., Ltd.
Management services
Baht 5 million
26.00
26.00
6,412
8,118
Al Ghaith Bangkok Dusit Management Services LLC.
Management services
UAE DIRHAM 0.15 million
30.00
30.00
393
393
6,805
8,511
12,864,094
2,815,613
Total investments in associated company held by the subsidiary companies Total investments in associated companies in the consolidated financial statements
Notes to consolidated financial statements
Paid-up Capital
12.1 Additional investments in associated companies Bumrungrad Hospital Public Co., Ltd. In the first quarter of 2012, the Company additionally purchased ordinary shares of Bumrungrad Hospital Public Co., Ltd. for total of 44.2 million shares, amount of Baht 2,234.9 million, representing 6.06 percent of shareholding. As a result, the Company holds totally 20.28 percentage of shareholding in that company and changes its status to become an associated company. The Company realised gain from the remeasurement of its previously held shareholding to fair value in the consolidated statement of income by Baht 1,795.0 million, under the caption “Gain on fair value adjustment of investment” and reversed gain on change in value of available-for-sale investments due to transfer of investment from other long-term investments to investments in associated companies amounting to Baht 1,372.3 million in the statements of comprehensive income. In the second quarter of 2012, the Company additionally purchased ordinary shares of Bumrungrad Hospital Public Co., Ltd. for total of 26.3 million shares, amount of Baht 1,762.2 million. As a result, the Company's shareholding in that company increased to 23.88 percent.
Annual Report 2012
Company’s name
Natures of business
(Unit: Thousand Baht)
Consolidated financial statements
Notes to consolidated financial statements Annual Report 2012
118
Udon Pattana (1994) Co., Ltd. As a result of purchasing of investment as stated in Note 13.3 and 13.4, Prasit Patana Public Company Limited, the subsidiary company, has 10 percentage of shareholding in Udon Pattana (1994) Co., Ltd. or 9.71 indirect percentage of shareholding by the Company. Subsequently, during the year 2011, the Company purchased additional investment of 1,577,000 shares, totaling Baht 38.30 million or 5.26 percentage of shareholding in Udon Pattana (1994) Co., Ltd. from the former shareholders. As a result, the Company holds totally 24.97 percentage of shareholding in that company and changes its status to become an associated company. The Company realised gain from the remeasurement of its previously held shareholding to fair value in the consolidated statement of income by Baht 39 million, under the caption “gain on fair value adjustment of investments”. The Company has also reversed allowance for impairment of such investments of Baht 12.3 million in 2011. 12.2 Details of share of income and dividend received from the associated companies are set out below. (Unit: Thousand Baht)
Company’s name Associated companies held by the Company The Medic Pharma Co., Ltd. Cool & Joy Co., Ltd. S.R. Property Investment Co., Ltd. Siem Reap Land Investment Co., Ltd. Phnom Penh First Property Co., Ltd. Bangkok Helicopter Services Co., Ltd. Ramkhamhaeng Hospital Public Co., Ltd. Krungdhon Hospital Public Co., Ltd. Udon Patana (1994) Co., Ltd. Bumrungrad Hospital Public Co., Ltd. Associated companies held by the subsidiary companies Sodexo Support Services (Thailand) Co., Ltd. Al Ghaith Bangkok Dusit Management Services LLC. Total
Consolidated financial statements Share of income/(loss) from investments in associated companies 2012 2011
Separate financial statements Dividend received during the year 2012
2011
27,327 317 303 683 (3,157) 431,080 2,658 5,329 497,719
22,811 339 309 693 (2,827) 349,806 7,006 -
6,300 55,061 6,004 200,828
5,250 55,061 1,501 -
5,404 967,663
3,508 381,645
268,193
61,812
Below are fair values of investments in associated companies that are listed companies on the Stock Exchange of Thailand
(Unit: Thousand Baht)
Company’s name Ramkhamhaeng Hospital Public Co., Ltd. Krungdhon Hospital Public Co., Ltd. Bumrungrad Hospital Public Co., Ltd. Total
Fair values as at 31 December 2012
2011
7,231,356 139,594 12,901,915 20,272,865
3,588,148 97,566 3,685,714
12.3 Below is a summary of financial information of associated companies
(Unit: Million Baht)
Associated companies held by the Company The Medic Pharma Co., Ltd. Cool & Joy Co., Ltd. S.R. Property Investment Co., Ltd. Siem Reap Land Investment Co., Ltd. Phnom Penh First Property Co., Ltd. Bangkok Helicopter Services Co., Ltd. Ramkhamhaeng Hospital Public Co., Ltd. Krungdhon Hospital Public Co., Ltd. Udon Patana (1994) Co., Ltd. Bumrungrad Hospital Public Co., Ltd. Associated companies held by the subsidiary companies Sodexo Support Services (Thailand) Co., Ltd Al Ghaith Bangkok Dusit Management Services LLC.
2012
2011
Baht 21 million
Baht 21 million
Baht 5 million
Baht 5 million
Riel 20 million
Riel 20 million
Riel 20 million
Riel 20 million
Riel 20 million
Riel 20 million
Baht 100 million Baht 100 million Baht 120 million Baht 120 million Baht 150 million Baht 150 million Baht 300 million Baht 300 million Baht 730 million
-
Total assets 2012
2011
Total liabilities
Total revenues
2012
2012
2011
Net income (loss) 2012
2011
2011
57.5 55.7 415.4 356.5 105.7 91.4 467.0 371.5 2.9 2.9 0.7 0.7 0.6 0.7 67.4 69.8 63.1 66.0 0.6 0.6 0.6 0.6 61.4 63.5 57.8 60.4 1.4 1.5 1.4 1.4 141.0 145.9 133.8 139.9 61.4 70.0 (7.5) (5.9) 235.1 258.5 164.9 180.7 6,766.5 5,415.0 2,143.2 2,110.2 3,572.1 3,044.1 1,127.3 909.0 13.3 35.0 305.7 312.9 48.7 37.5 304.4 295.9 21.3 22.9 1,086.5 1,071.1 361.9 361.7 430.8 393.5 - 2,667.5 15,861.8 7,474.2 - 14,041.6
Baht 5 million
Baht 5 million
152.6
105.7
127.9
74.5
443.9
319.3
20.8
13.5
UAE DIRHAM 0.15 million
UAE DIRHAM 0.15 million
-
-
-
-
-
-
-
-
Share of income from investment in three associated companies which are listed company on the Stock Exchange of Thailand for the year ended 31 December 2012 of Baht 931 million (2011: two associated companies Baht 357 million) representing 96 percent (2011: 94 percent) of total share of income from all associated companies were calculated based on audited financial statements of those companies.
13. Investments in subsidiary companies (Unit: Thousand Baht) Company’s name
Nature of business
Paid-up capital
% Share holding
Separate financial statements Investments - cost method
Dividend received during the year
2012
2011
2012
2011
2012
2011
Samitivej Public Co., Ltd.
Hospital
Baht 1,000 million
95.76
95.76
1,639,071
1,639,071
430,936
384,970
Bangkok Hospital Hatyai Co., Ltd.
Hospital
Baht 500 million
98.79
98.78
574,458
574,373
59,274
34,573
Bangkok Phuket Hospital Co., Ltd.
Hospital
Baht 500 million
99.68
99.68
610,153
610,153
124,606
79,739
BNH Medical Center Co., Ltd.
Hospital
Baht 586 million
91.48
91.48
602,655
602,655
160,857
147,447
Bangkok Phrapradaeng Hospital Co., Ltd.
Hospital
Baht 105 million
79.00
79.00
96,775
96,775
-
-
Bangkok Pattaya Hospital Co., Ltd.
Hospital
Baht 280 million
97.27
97.22
708,966
708,196
517,382
244,982
Bangkok Rayong Hospital Co., Ltd.
Hospital
Baht 400 million 100.00
100.00
415,020
415,020
-
180,000
Bangkok Samui Hospital Co., Ltd.
Hospital
Baht 150 million 100.00
100.00
150,000
150,000
33,750
45,000
Bangkok Trat Hospital Co., Ltd.
Hospital
Baht 250 million
99.76
99.76
245,889
245,889
14,963
19,951
Wattanavej Co., Ltd.
Hospital
Baht 180 million
99.69
99.69
450,643
450,643
35,890
179,450
Bangkok Ratchasima Hospital Co., Ltd.
Hospital
Baht 300 million
90.36
89.73
923,936
917,286
-
-
National Healthcare Systems Co., Ltd.
Central Lab
Baht 75 million
74.02
74.02
56,768
56,768
-
66,622
Notes to consolidated financial statements
Paid-up capital
Company’s name
For the years ended 31 December
119 Annual Report 2012
As at 31 December
(Unit: Thousand Baht)
Notes to consolidated financial statements
Company’s name
Annual Report 2012
120
Nature of business
Paid-up capital
% Share holding
2012
2011
Separate ďŹ nancial statements Investments - cost method
Dividend received during the year
2012
2012
2011
2011
Bio Molecular Laboratories (Thailand) Co., Ltd.
Central Lab
Baht 10 million
95.00
95.00
9,502
9,502
Angkor Pisith Co., Ltd.
Hospital
USD 10 million
7,600
80.00
80.00
287,840
287,840
-
-
Phnom Penh Medical Services Co., Ltd.
Hospital
USD 10 million 100.00
100.0
338,323
338,323
-
-
Royal Rattanak Medical Services Co., Ltd.
Hospital
Riel 26,000 million
70.00
70.00
154,063
154,063
-
-
Hospital
Riel 9,200 million 100.00
100.00
94,208
94,208
-
-
Investment
Baht 35 million 100.00
100.00
35,000
35,000
-
-
Hospital
Baht 1 million 100.00
100.00
999
999
-
-
99.94
99.94
47,027
47,027
-
-
service
Baht 736 million 100.00
100.00
736,000
736,000
63,296
Technology and information service
Baht 200 million 100.00
100.00
200,000
200,000
-
-
Hospital
Baht 70 million 100.00
100.00
70,000
70,000
-
-
Training business
Baht 1 million 100.00
100.00
1,000
1,000
-
-
4,750
B.D.M.S. International Medical Services Co., Ltd. Asia International Healthcare Co., Ltd. New Petchburi Medical Services Co., Ltd. Bangkok Health Insurance Limited
Health insurance
Royal Bangkok Healthcare Co., Ltd.
Management
Greenline Synergy Co., Ltd. Bangkok Hospital Kao Yai Co., Ltd. BDMS Training Co., Ltd. Prasit Patana Public Co., Ltd.
Investment
Baht 105 million
18,400
98.32
97.14
9,236,292
9,109,950
414,054
-
Baht 300 million 100.00
100.00
2,922,872
2,922,872
-
399,900
Baht 1,108 million
Paolo Medic Co., Ltd.
Hospital
Paolo Samutprakarn Co., Ltd.
Hospital
Baht 42 million
93.30
88.73
1,733,240
1,675,754
7,453
7,453
Siam Medical Co., Ltd.
Hospital
Baht 100 million
85.69
80.72
939,589
904,818
4,036
4,931
Thai Medical Center Public Co., Ltd.
Hospital
Baht 201 million
99.76
99.76
887,135
887,135
-
-
broker
Baht 20 million 100.00
100.00
20,000
4,000
-
-
Bangkok Hospital Chiangmai Co., Ltd.
Hospital
Baht 250 million 100.00
-
250,000
-
-
-
Bangkok Hospital Udon Co., Ltd.
Hospital
Baht 500 million 100.00
-
499,930
-
-
-
Bangkok Premier Life Insurance Broker Co., Ltd.
Life insurance
Total investments in subsidiary companies
24,937,354
Less: Allowance for impairment of investment
(20,000)
(20,000)
24,917,354
23,925,320
23,945,320 1,874,097
1,818,168
Total investments in subsidiary companies - net
13.1 Additional investments in 2012 in subsidiary companies which the Company and its subsidiaries previously held Bangkok Hospital Hatyai Co., Ltd. In 2012, the Company purchased additional investment totaling Baht 0.1 million in Bangkok Hospital Hatyai Co., Ltd. As a result, the Company's shareholding in that company increased to 98.79 percent. Bangkok Pattaya Hospital Co., Ltd. In 2012, the Company purchased additional investment totaling Baht 0.8 million in Bangkok Pattaya Hospital Co., Ltd. As a result, the Company's shareholding in that company increased to 97.27 percent.
In addition, Prasit Patana Public Co., Ltd. has decreased its 390,773,228 registered shares with par value of Baht 1 each, totaling Baht 390,773,228, from formal registered share Baht 2,732,047,520 to be Baht 2,341,274,292 by written-off non-issued shares. The subsidiary company has also decreased its issued and fully paid-up shares by offsetting with deficit amount of Baht 1,233,066,272, from formal issued and fully paid-up shares of Baht 2,341,274,292 to be Baht 1,108,208,020. Prasit Patana Public Co., Ltd. and Phyathai 2 Hospital Co., Ltd. In 2012, the subsidiary company purchased additional investment totaling Baht 0.7 million in Phyathai 2 Hospital Co.,Ltd. As a result, the subsidiary company’s shareholding in that company increased to 99.15 percent. Prasit Patana Public Co., Ltd. and Phyathai 3 Hospital Co., Ltd. In 2012, the subsidiary company purchased additional investment totaling Baht 2.4 million in Phyathai 3 Hospital Co., Ltd. As a result, the subsidiary company’s shareholding in that company increased to 98.20 percent. Prasit Patana Public Co., Ltd. and Sriracha Nakorn General Hospital Public Co., Ltd. In 2012, the subsidiary company purchased additional investment totaling Baht 37.3 million in Sriracha Nakorn General Hospital Public Co., Ltd. As a result, the subsidiary company’s shareholding in that company increased to 66.53 percent. Paolo Samutprakarn Co., Ltd. In 2012, the Company purchased additional investment totaling Baht 57.5 million in Paolo Samutprakarn Co., Ltd. As a result, the Company's shareholding in that company increased to 93.30 percent. Siam Medical Co., Ltd. In 2012, the Company purchased additional investment totaling Baht 34.8 million in Siam Medical Co., Ltd. As a result, the Company's shareholding in that company increased to 85.69 percent. Bangkok Premier Life Insurance Broker Co., Ltd. On 3 September 2012, the Extraordinary Meeting of Shareholders No.3/2012 of Bangkok Premier Life Insurance Broker Co., Ltd. passed a resolution to increase its share capital from Baht 4 million to Baht 20 million by issuing 1,600,000 additional ordinary shares with a par value of Baht 10 per share, totaling Baht 16 million. The Company acquired all of the additional shares. 13.2 Investment in a new subsidiary company during the year Bangkok Hospital Chiangmai Co., Ltd. On 25 April 2012, a meeting of the Board of Directors of the Company approved the establishment of a new subsidiary company, namely Bangkok Hospital Chiangmai Company Limited, to operate a hospital business in Chiangmai province. This company has Baht 1,000 million of registered capital and the Company holds 100 percent. The subsidiary company was incorporated in May 2012 and has Baht 250 million paid-up share capital.
121 Annual Report 2012
Prasit Patana Public Co., Ltd. In 2012, the Company purchased additional investment totaling Baht 126.3 million in Prasit Patana Public Co., Ltd. As a result, the Company's shareholding in that company increased to 98.32 percent.
Notes to consolidated financial statements
Bangkok Ratchasima Hospital Co., Ltd. In 2012, the Company purchased additional investment totaling Baht 6.7 million in Bangkok Ratchasima Hospital Co., Ltd. As a result, the Company's shareholding in that company increased to 90.36 percent.
13.3 Merger with Health Network Public Company Limited in 2011 On 24 February 2011, the Extraordinary General Meeting of the Company approved for the Company to enter into the merger with Health Network Public Company Limited and the Company has completed the entire business transfer on 1 April 2011 by paying the total consideration of Baht 11,484 million (See consideration paid summary in a). After merger, the Company has additional investment in subsidiary companies as follows:
122
The Company and Health Network Public Company Limited must comply with the conditions stipulated in the entire business transfer agreement.
Annual Report 2012
Notes to consolidated financial statements
Bangkok Hospital Udon Co., Ltd. In the second quarter of 2012, the Company invested a 100 percent shareholding in Bangkok Hospital Udon Co., Ltd., totaling Baht 499.9 million, to operate a hospital business in Udonthani province.
Company
% of shares held
1) Prasit Patana Public Company Limited and its subsidiaries 2) Paolo Medic Company Limited 3) Paolo Samutprakarn Company Limited 4) Siam Medical Company Limited 5) Thai Medical Centre Public Company Limited
68.64%* 100.00% 88.73% 80.72% 99.76%
* Including the Company’s existing 19.47% shareholding in Prasit Patana Public Company Limited and resulted in a change in the status of this company to a subsidiary company. The Company realised gain from the remeasurement of its previously held shareholding to fair value in the consolidated statement of income by Baht 440 million, under the caption “gain on fair value adjustment of investments”.
Goodwill from merger a) Consideration paid for goodwill calculation is as follows: (Unit: Thousand Baht)
The Company issued 230,870,405 ordinary shares (calculation from fair value at acquisition date) Cash Novation of loan Total consideration Add : Fair value of the Company’s existing 19.47% shareholding in Prasit Patana Public Company Limited Total consideration paid for calculating goodwill
10,424,687 680,000 379,416 11,484,103 1,512,559 12,996,662
1,986,099 264,357 818,977 360,000 158,317 110,889 50,000 24,094 244,233 34,400 9,342,016 188,269 62,315 (463,867) (311,239) (833,921) (5,565,664) (205,270) (304,132) (937,341) 5,022,532 (1,336,070) 3,686,462 12,996,662 9,310,200
The cost of merger and tender offer totaling Baht 189.5 million has been separately recorded as expense in income statements for amount of Baht 43.4 million and the cost of Baht 146.1 million which was related to share capital increase has been offset with share premium under shareholders' equity in statements of financial position. 13.4 Tender offer to purchase securities of Prasit Patana Public Company Limited On 7 April 2011, the Company submitted a tender offer proposal to purchase securities of Prasit Patana Public Company Limited, offering the two following options of payment to shareholders: 1. Cash payment of Baht 3.71 per share 2. The Company’s newly issued ordinary shares at the ratio of 10.1706 shares in Prasit Patana Public Company Limited to 1 share in the Company, equaling Baht 37.75 per share.
Notes to consolidated financial statements
Cash and cash equivalents Short-term investments Trade accounts receivable - net Short-term loan to a related company Inventories Other current assets Long-term deposit at financial institution Restricted financial institution deposits Other long-term investments - net Investment property Property, premises and equipment - net Intangible assets - net Other non-current assets Trade accounts payable Income tax payable Other current liabilities Long-term loans from financial institutions Liabilities under finance lease agreement Provision for long-term employee benefits Other non-current liabilities Fair value of net assets Less : Non-controlling interest Net asset acquired Consideration paid Goodwill
(Unit: Thousand Baht)
123 Annual Report 2012
b) The fair value of assets and liabilities at acquisition date are as follows:
Notes to consolidated financial statements Annual Report 2012
124
After Tender offer completion on 23 May, 2011, the Company has additional investment in ordinary shares of Prasit Patana Public Company Limited of 666.34 million shares, totaling Baht 2,939.9 million by cash payment of Baht 43.34 million and issuing 64.4 million ordinary shares of the Company, totaling Baht 2,896.56 million (calculation from fair value at acquisition date). As a result, the Company's shareholding in that company increased to 97.10 percent. In addition, in the third quarter of 2011, the Company purchased additional investment of 1.09 million shares, totaling Baht 4.04 million in Prasit Patana Public Company Limited from the former shareholders. As a result, the Company's shareholding in that company as at 31 December 2011 was 97.14 percent.
14. Other long-term investments (Unit: Thousand Baht)
Company's name
Paid-up Nature capital of business (Million Baht)
% share holding
Consolidated and separate ďŹ nancial statements Dividend income Investment (cost) during the years 2012
2011
2012
2011
Investments held by the Company Available-for-sale investments Investments in listed securities Thai Military Bank Public Co., Ltd.
Bank
Aikchol Hospital Public Co., Ltd.
Hospital
Bumrungrad Hospital Public Co., Ltd. Bangkok Chain Hospital Public Co., Ltd.
41,372
-
1,770
1,770
2
1
125
0.20
350
350
88
63
Hospital
730
14.22
-
3,455,835
-
87,281
Hospital
1,995
1.50
269,829
-
4,541
-
271,949
3,457,955
4,631
87,345
available-for-sale investments
4,451
1,372,094
-
-
Investments in listed securities
276,400
4,830,049
4,631
87,345
Surplus on changes in value of
Investments in related companies Bangkok Airways Co., Ltd. X-Ray Computer Urupong Co., Ltd.
Airline
1,200
1.20
36,000
36,000
7,798
10,830
X-ray lab
100
4.09
4,520
4,520
245
245
40,520
40,520
8,043
11,075
-
-
Investments in related companies Investments in unrelated companies Thai Longstay Management Co., Ltd. Superior Biotech Holding Co., Ltd. Udon Patana (1994) Co., Ltd.*
Travel business
100
1.06
531
531
Investment
44
9.09
5,000
5,000
200
140
Hospital
300
10.00
-
-
600
5,531
5,531
200
740
322,451
4,876,100
12,874
99,160
Investments in unrelated companies
-
Total other long-term investments in the separate ďŹ nancial statements
* Change status to become associated company in 2011
(Unit: Thousand Baht)
Consolidated and separate financial statements Dividend income Investment (cost) during the years 2012
2011
2012
2011
50
48
Investment held by thesubsidiary companies Investments in unrelated companies Thai Herbal Products Co., Ltd.
Sales of herbal products
80
0.60
290
290
Prasitthirat Co., Ltd.
Educational institution
150
33.33
107,192
107,192
Phuket International Hospital Co., Ltd.
Hospital
195
6.15
29,552
29,552
Udon Patana (1994) Co., Ltd.*
Hospital
300
10.00
-
Asia Laboratories Center Limited
Central lab
5
8.00
Investments in unrelated companies
-
1,000
3,600 -
-
2,700 600
400
400
40
20
137,434
137,434
3,690
4,368
Investments in ordinary shares (ceased operations) Subsidiary companies Phyathai 4 Hospital (Petchaburi Road) Co., Ltd. Adjudged bankrupt
328
89.79
-
-
-
-
Klass - V Co., Ltd.
Adjudged bankrupt
250
89.66
-
-
-
-
Phuket Paradise Co., Ltd.
Adjudged bankrupt
409
72.26
-
-
-
-
Phyathai Herbs Co., Ltd.
In process of liquidation
196
63.64
42,889
-
-
Hospital
358
19.08
-
-
-
42,889
Unrelated company Phuket Hospital Public Co., Ltd. Less : Allowance for impairment of investment
-
42,889
42,889
-
-
(7,000)
(7,000)
-
-
35,889
35,889
-
-
495,774
5,049,423
16,564
103,528
Investment in ordinary shares (ceased operations) - net Total other long-term investments - net in the consolidated financial statements
* Change status to become associated company in 2011
Bangkok Chain Hospital Public Company Limited In the second quarter of 2012, the Company purchased ordinary shares of Bangkok Chain Hospital Public Co., Ltd. for total of 30 million shares, amount of Baht 269.83 million, representing 1.50 percent of shareholding. Prasitthirat Company Limited A subsidiary company had 33.33 percentage of shareholding in Prasitthirat Company Limited but has not classified it as investment in associated company because the subsidiary company has no power to participate in the financial and operating policy decisions of that company. Investments in ordinary shares (ceased operations)-Subsidiary companies A subsidiary company has investments in companies that have ceased their operations but has not classified them as investments in subsidiary companies because the subsidiary company has no power to control such companies.
Notes to consolidated financial statements
Paid-up capital % share (Million holding Baht)
125 Annual Report 2012
Company's name
Nature of business
15. Investment properties
(Unit: Thousand Baht)
Notes to consolidated financial statements
Consolidated financial statements
Annual Report 2012
126
31 December 2010 Increase from acquisition Purchase Transfer from property, premises and equipment Gain on revalue of assets 31 December 2011 Purchase Transfer from property, premises and equipment Gain on revalue of assets 31 December 2012
Separate financial statements
Land
Building
Total
Land
Building
Total
34,400 -
135,177
34,400 135,177
252,966 -
135,177
252,966 135,177
1,045 35,445 -
19,604 154,781 12,008
19,604 1,045 190,226 12,008
18,069 271,035 -
19,604 154,781 12,008
19,604 18,069 425,816 12,008
35,445
2,684 17,877 187,350
2,684 17,877 222,795
271,035
2,684 17,877 187,350
2,684 17,877 458,385
The investment properties of the Company and its subsidiaries of the Company and its subsidiaries consist of land and building for rent. The fair value of land has been determined based on valuations performed by an accredited independent valuer, using the Market approach. The fair value of building for rent has been determined based on Income approach.
16. Property, premises and equipment
(Unit: Thousand Baht)
Consolidate financial statements Assets which are stated at cost or reappraised value
Assets which are stated at cost
Medical Structure tools, equipment, Building and machine furniture, fixture Land and land building and and office improvement improvement equipment equipment Cost/reappraised value 31 December 2010 Increase from acquisition Increase from revaluation Purchases Transfer in / (Transfer out) Disposals / Written-off Translation adjustment 31 December 2011 Increase from revaluation Purchases Transfer in / (Transfer out)
5,345,964 2,860,267 8,985 330,145 49 8,545,410 512,526 1,092,854 -
16,130,196 7,079,417 629,089 370,332 (35,925) 17,571 24,190,680 793,454 1,223,027
7,633,783 2,969,286 1,354,679 66,232 (196,395) 3,493 11,831,078 1,810,257 64,852
4,282,332 1,006,114 518,730 101,924 (106,133) 4,514 5,807,481 635,547 216,474
Vehicles
Building under construction and medical tools and equipment under installation
Total
462,439 121,255 67,475 1,177 (33,312) 240 619,274 90,440 2,431
822,939 279,925 964,574 (595,984) (288) 25,264 1,496,430 1,693,874 (1,512,759)
34,677,653 14,316,264 8,985 3,864,692 (56,270) (372,053) 51,082 52,490,353 512,526 6,116,426 (5,975)
(Unit: Thousand Baht)
Assets which are stated at cost
Medical Structure tools, equipment, Building and machine furniture, fixture Land and land building and and office improvement improvement equipment equipment Disposals / Written-off Translation adjustment 31 December 2012 Accumulated depreciation 31 December 2010 Increase from acquisition Depreciation for the year Transfer in / (Transfer out) Disposals / Written-off Translation adjustment 31 December 2011 Depreciation for the year Transfer in / (Transfer out) Disposals / Written-off Translation adjustment 31 December 2012 Impairment of fixed assets 31 December 2010 Reversal of impairment loss 31 December 2011 impairment loss 31 December 2012 Net book value 31 December 2011 31 December 2012
Vehicles
Building under construction and medical tools and equipment under installation
Total
10,150,790
(32,292) (12,098) 26,162,771
(367,228) (1,955) 13,337,004
(148,551) (2,911) 6,508,040
(19,165) (208) 692,772
(1,517) (17,384) 1,658,644
(568,753) (34,556) 58,510,021
17,482 7,011 330 16 24,839 458 25,297
7,161,985 2,468,573 1,089,527 4,775 (25,304) 2,696 10,702,252 1,139,359 (1,254) (27,009) (2,045) 11,811,303
4,843,502 1,717,567 1,036,963 53,134 (193,226) 2,686 7,460,626 1,149,986 (325,328) (2,133) 8,283,151
3,425,594 711,822 422,604 (58,215) (96,028) 3,643 4,409,420 462,811 100 (139,351) (2,845) 4,730,135
367,289 69,275 56,119 (744) (31,952) 203 460,190 61,574 (18,287) (157) 503,320
-
15,815,852 4,974,248 2,605,543 (1,034) (346,510) 9,228 23,057,327 2,814,188 (1,154) (509,975) (7,180) 25,353,206
2,955 2,955 1,914 4,869
750 (750) -
-
-
-
-
3,705 (750) 2,955 1,914 4,869
13,488,428 14,351,468
4,370,452 5,053,853
1,398,061 1,777,905
159,084 189,452
1,496,430 1,658,644
8,517,616 10,120,624
Depreciation charged included in income statement for the year 2011 (Baht 2,114 million included in cost of hospital operations, sales and services, and the balance in administrative expenses) 2012 (Baht 2,294 million included in cost of hospital operations, sales and services, and the balance in administrative expenses)
29,430,071 33,151,946
2,605,543 2,814,188
127 Annual Report 2012
Assets which are stated at cost or reappraised value
Notes to consolidated financial statements
Consolidate financial statements (continued)
(Unit: Thousand Baht)
Notes to consolidated financial statements
Separate ďŹ nancial statements
Annual Report 2012
128
Assets which are stated at cost or reappraised value
Assets which are stated at cost
Medical Structure tools, equipment, Building and machine furniture, ďŹ xture Land and land building and and ofďŹ ce improvement improvement equipment equipment Cost/reappraised value 31 December 2010 Cumulative effect of change in accounting policy Purchases Transfer in / (Transfer out) Disposals / Written-off 31 December 2011 Increase from revaluation Purchases Transfer in / (Transfer out) Disposals / Written-off 31 December 2012 Accumulated depreciation 31 December 2010 Depreciation for the year Transfer in / (Transfer out) Disposals / Written-off 31 December 2011 Depreciation for the year Transfer in / (Transfer out) Disposals / Written-off 31 December 2012 Net book value 31 December 2011 31 December 2012
Vehicles
Building under construction and medical tools and equipment under installation
Total
1,018,331
4,352,682
2,606,095
1,248,721
143,389
249,510
9,618,728
(252,966) 24,532 789,897 352,237 721,250 1,863,384
104,529 130,548 4,587,759 91,199 3,262 (8,184) 4,674,036
400,663 425 (4,943) 3,002,240 465,521 4,700 (83,005) 3,389,456
112,964 94,705 (7,633) 1,448,757 163,613 62,982 (25,639) 1,649,713
19,452 (14,978) 147,863 28,859 (3,681) 173,041
124,050 (246,520) (10) 127,030 313,487 (74,782) 365,735
(252,966) 786,190 (20,842) (27,564) 10,103,546 352,237 1,783,929 (3,838) (120,509) 12,115,365
-
1,627,979 273,402 (2,051) 1,899,330 222,817 (1,153) (3,893) 2,117,101
1,612,937 326,642 (4,623) 1,934,956 334,441 (67,398) 2,201,999
1,101,093 77,309 946 (5,510) 1,173,838 75,706 (25,452) 1,224,092
124,604 6,638 (13,923) 117,319 10,391 (3,614) 124,096
-
4,466,613 683,991 (1,105) (24,056) 5,125,443 643,355 (1,153) (100,357) 5,667,288
789,897 1,863,384
2,688,429 2,556,935
1,067,284 1,187,457
274,919 425,621
30,544 48,945
127,030 365,735
4,978,103 6,448,077
Depreciation charged included in income statement for the year 2011 (Baht 594 million included in cost of hospital operations, sales and services, and the balance in administrative expenses) 2012 (Baht 573 million included in cost of hospital operations, sales and services, and the balance in administrative expenses)
683,991 643,355
In 2011, a subsidiary has recorded appraisal result which engaged an independent appraiser to appraise all of its land using the market approach. The fair values of the revalued land amounted to Baht 203 million which increased from the book value of Baht 9 million. The Company therefore recorded "Gain on revaluation of land" in the consolidated statements of comprehensive income.
If the Company and its subsidiaries recorded the land at cost, their net book value as at 31 December 2012 and 2011 would have been as follows: (Unit: Thousand Baht)
Consolidated financial statements
Separate financial statements
6,806,326 5,715,550
1,179,380 458,130
Net book value (at cost): As of 31 December 2012 As of 31 December 2011
As at 31 December 2012, the Company and its subsidiaries have medical tools, equipment and vehicles under finance lease agreements with net book values amounting to Baht 244.0 million and Baht 21.1 million in the separate financial statements (2011: Baht 420.3 million and Baht 11.2 million in the separate financial statements). As at 31 December 2012, the Company and its subsidiaries have certain building improvement, medical tools, equipment and vehicles which have been fully depreciated but are still in use. The original cost of those assets amounted to approximately Baht 11,631.4 million and Baht 2,962.4 million in the separate financial statement (2011: Baht 9,752.8 million and Baht 2,130.1 million in the separate financial statements).
17. Land and buildings not used in operations
Land and buildings not used in operations as at 31 December 2012 and 2011 consisted of: (Unit: Thousand Baht)
Land and buildings at historical cost Revaluation surplus Allowance for impairment Total
Consolidated financial statements
Separate financial statements
2012
2011
2012
2011
368,174 265,668 (719) 633,123
368,174 143,748 (719) 511,203
367,847 265,668 (719) 632,796
367,847 143,748 (719) 510,876
In 2012, the Company has recorded appraisal result which engaged an independent appraiser to appraise all of its land using the market approach. The fair values of the revalued land amount of Baht 602 million which increased from the book values of Baht 122 million and was recorded as "Gain on revaluation of land" in the statements of comprehensive income.
Notes to consolidated financial statements
The revaluation surplus can neither be offset against deficit nor used for dividend payment.
129 Annual Report 2012
In 2012, the Company and six subsidiary companies have recorded appraisal result which engaged an independent appraiser to appraise all of its land using the market approach. The fair values of the revalued land in consolidated financial statements amount of Baht 2,631 million which increased from the book values of Baht 513 million and decreased from the book values of Baht 2 million (Separate financial statements: the fair values of the revalued land amount of Baht 1,141 million which increased from the book values of Baht 352 million). The Company and its subsidiaries recorded the increase amount as "Gain on revaluation of land" in the statements of comprehensive income and recorded the decrease amount as "Loss on revaluation of land" in the statements of income.
Notes to consolidated financial statements
The cumulative capitalised interest on loans recorded as a portion of cost of land not used in operations amounted to approximately Baht 29 million (2011: Baht 29 million).
Annual Report 2012
130
18. Intangible assets
Intangible assets, as at 31 December 2012 and 2011, which are computer software are as follows:
Cost As at 31 December 2010 Increase from acquisition Purchases Transfer in Disposals/written-off Translation adjustment As at 31 December 2011 Purchases Transfer in Disposals/written-off Translation adjustment As at 31 December 2012 Accumulated amortisation As at 31 December 2010 Increase from acquisition Amortisation for the year Transfer out Disposals / written-off Translation adjustment As at 31 December 2011 Amortisation for the year Disposals / written-off Translation adjustment As at 31 December 2012 Net book value As at 31 December 2011 As at 31 December 2012
(Unit: Thousand Baht)
Consolidated ďŹ nancial statements
Separate ďŹ nancial statements
471,726 349,676 140,325 35,122 (384) 102 996,567 198,979 2,135 (4,223) (70) 1,193,388
148,344 9,473 133 157,950 125,535 283,485
270,306 161,407 82,904 (83) (141) 35 514,428 114,249 (3,980) (29) 624,668
73,247 11,715 84,962 14,252 99,214
482,139 568,720
72,988 184,271
19. Leasehold rights 2012
2011
2012
2011
733,767 (181,052) 552,715 22,137
716,587 (159,450) 557,137 19,041
133,010 (33,693) 99,317 6,744
133,010 (26,949) 106,061 5,903
A reconciliation of the net book value of leasehold rights for the years 2012 and 2011 is presented below. (Unit: Thousand Baht)
Net book value at beginning of year Increase from acquisition Purchases Less: amortisation Translation adjustment Net book value at end of year
Consolidated financial statements
Separate financial statements
2012
2011
2012
2011
557,137 27,281 (22,137) (9,566) 552,715
509,064 141 52,961 (19,041) 14,012 557,137
106,061 (6,744) 99,317
59,003 52,961 (5,903) 106,061
20. Bank overdrafts and short-term loans from financial institutions
As at 31 December 2012, the Company and its subsidiaries have bank overdraft facilities with banks of Baht 1,205 million and USD 1 million (2011: Baht 450 million and USD 1 million) and in separate financial statements of Baht 850 million (2011: Baht 150 million). The facilities carry interest rate at MOR for Baht currency facilities and LIBOR plus fixed rate for US currency facilities.
21. Trade and other payables (Unit: Thousand Baht)
Trade payables - related parties Trade payables - unrelated parties Other payables - related parties Other payables - unrelated parties Accounts payable - construction and retention Total trade and other payables
Consolidated financial statements
Separate financial statements
2012
2011
2012
2011
75,383 2,149,653 10,670 987,864 390,536 3,614,106
90,181 2,266,225 18,895 731,504 284,386 3,391,191
126,209 315,400 89,245 358,602 71,748 961,204
128,811 454,895 46,871 257,719 54,456 942,752
Notes to consolidated financial statements
Separate financial statements
131 Annual Report 2012
Cost Less: Accumulated amortisation Book value - net Amortisation for the year
(Unit: Thousand Baht)
Consolidated financial statements
22. Long-term loans from financial institutions (Unit: Thousand Baht)
Notes to consolidated financial statements
As at 31 December
Annual Report 2012
132
Long-term loans Less: Current portion due within one year Long-term loans - net of current portion
Consolidated financial statements
Separate financial statements
2012
2011
2012
2011
9,447,906 (889,645) 8,558,261
7,764,387 (813,215) 6,951,172
9,075,180 (820,198) 8,254,982
3,141,710 (436,300) 2,705,410
The Company a) In 2008, the Company entered into a 10-year loan agreement with a bank granting the credit facilities of Baht 3,438 million. The loan carries interest at the Fixed Deposit Rate plus fixed rate per annum as stipulated in the agreement with interest and principal payable on a monthly basis. This loan agreement includes a condition that the Company and its subsidiaries may not mortgage any assets and also certain covenants which the Company and its subsidiaries must comply. The Company also entered into an interest rate swap contract for the above loan with a financial institution as discussed in Note 36.2 the outstanding balance of this loan as at 31 December 2012 was Baht 1,776.3 million (2011: Baht 2,120.1 million). b) In November 2011, the Company entered into a loan agreement with a financial institution granting credit facilities of Baht 1,000 million carrying interest at six-month Fixed Deposit Rate plus fixed rates per annum as stipulated in the agreement. The interest is repayable on a monthly basis and the principal is repayable on every six-month according to a condition as stipulated in the agreement. The drawdown period was within 1 year from the agreement date and extended the agreement. As at 31 December 2012, the Company had not yet withdrawn such loan. c) In November 2011, the Company entered into a 7 years and 6 months loan agreement with a financial institution granting credit facilities of Baht 3,000 million carrying interest at the rate of six-month Fixed Deposit Rate plus fixed rates per annum as stipulated in the agreement. The interest is repayable on a monthly basis and the principal is repayable on a quarterly basis according to a condition as stipulated in the agreement. As at 31 December 2012, this loan has outstanding balance of Baht 2,569.0 million (2011: Baht 1,021.6 million). d) In January 2012, the Company entered into a 8 years and 6 months loan agreement with a financial institution granting credit facilities of Baht 586 million carrying interest at the rate of six-month Fixed Deposit Rate plus fixed rates per annum as stipulated in the agreement. The interest and principal are repayable on a monthly basis according to a condition as stipulated in the agreement. As at 31 December 2012, this loan has outstanding balance of Baht 558.5 million. e) In June 2012, the Company entered into a 7 years and 6 months loan agreement with a financial institution granting credit facilities of Baht 1,766 million carrying interest at the rate of six-month Fixed Deposit Rate plus fixed rates per annum as stipulated in the agreement. The interest is repayable on a monthly basis and principal is repayable on a quarterly basis according to a condition as stipulated in the agreement. As at 31 December 2012, this loan has outstanding balance of Baht 1,671.4 million. f) In July 2012, the Company entered into a 5 - year loan agreement with a financial institution amounting to Baht 2,500 million. The loan has a period of 5 years and carries interest at the fixed rate per annum as stipulated in the agreement. The interest is repayable on a semi-annually basis and principal is repayable at the end of loan period. As at 31 December 2012, this loan has outstanding balance of Baht 2,500 million.
The Company’s and its subsidiaries' loan agreements contain certain covenants which the Company and its subsidiaries must comply such as financial ratios.
23. Liabilities under finance lease agreements
As at 31 December 2012 and 2011, liabilities under finance lease agreements are as follows: Consolidated financial statements
Separate financial statements
2012
2011
2012
2011
191,325 (12,538) 178,787 (92,713) 86,074
364,871 (29,843) 335,028 (149,723) 185,305
18,934 (1,348) 17,586 (6,150) 11,436
10,816 (837) 9,979 (3,051) 6,928
The Company and its subsidiaries have future minimum lease payments which required under the finance lease agreements as follows: (Unit: Thousand Baht)
As at 31 December 2012 Consolidated financial statements Future minimum finance lease payments Deferred interest expenses Present value of future minimum finance lease payments
Less than 1 year
1 - 5 year
Total
101,651 (8,938) 92,713
89,674 (3,600) 86,074
191,325 (12,538) 178,787
Annual Report 2012
133 (Unit: Thousand Baht)
Liabilities under finance lease agreements Less: Deferred interest expenses Total Less: Current portion of liabilities under finance lease agreements Liabilities under finance lease agreements - net of current portion
Notes to consolidated financial statements
The subsidiaries a) In 2007 and 2008, Angkor Pisith Co., Ltd., a subsidiary company, entered into a 7 years and 10 months loan agreement with a foreign financial institution granting credit facilities of USD 4 million. The loan bears interest at the rate of LIBOR plus a fixed rate per annum. The interest is repayable on a monthly basis and the principal is repayable on a quarterly basis according to a condition as stipulated in the agreement. This loan is guaranteed by the Company. As at 31 December 2012, this loan has outstanding balance of USD 3.1 million or equivalent to Baht 94.4 million. (2011: USD 3.6 million or equivalent to Baht 113.8 million). b) In 2008, Bangkok Ratchasima Hospital Co., Ltd., a subsidiary company, entered into a 7 - year loan agreement with a financial institution. The credit facilities were Baht 20 million. The loan bears interest at fixed rate per annum. The interest and principal are repayable on a monthly basis according to a condition as stipulated in the agreement. As at 31 December 2012, this loan has outstanding balance of Baht 8.9 million (2011: Baht 12.2 million). c) In 2009, Sriracha Nakorn General Hospital Public Company Limited, a subsidiary company of a subsidiary company, entered into a 9 - year loan agreement with another financial institution to obtain loan of Baht 410 million. This loan consequently amended to bears interest at a six-month Fixed Deposit Rate plus fixed rate per annum, with the specified repayments of principal and interest as stipulated in the agreement. As at 31 December 2012, this loan has outstanding balance of Baht 269.4 million (2011: Baht 315.8 million).
(Unit: Thousand Baht)
As at 31 December 2012
Notes to consolidated financial statements
Consolidated financial statements Future minimum finance lease payments Deferred interest expenses Present value of future minimum finance lease payments
1 - 5 year
Total
169,207 (19,484) 149,723
195,664 (10,359) 185,305
364,871 (29,843) 335,028 (Unit: Thousand Baht)
As at 31 December 2012 Separate financial statements Future minimum finance lease payments Deferred interest expenses Present value of future minimum finance lease payments
Less than 1 year
1 - 5 year
Total
6,844 (694) 6,150
12,090 (654) 11,436
18,934 (1,348) 17,586 (Unit: Thousand Baht)
As at 31 December 2012 Separate financial statements
134 Annual Report 2012
Less than 1 year
Future minimum finance lease payments Deferred interest expenses Present value of future minimum finance lease payments
Less than 1 year
1 - 5 year
Total
3,525 (474) 3,051
7,291 (363) 6,928
10,816 (837) 9,979
The Company and its subsidiaries have finance lease agreements with various leasing companies to rent medical tools, equipment, and vehicles for use in their operations. Installments are due on a monthly basis over 32-60 months and at the end of the agreements.
24. Provision for long-term employee benefits
Provision for long-term employee benefits, which is compensations on employees’ retirement, was as follows: (Unit: Thousand Baht)
Defined benefit obligation at beginning of year Increase from acquisition Current service cost Interest cost Benefits paid during the year Actuarial loss Defined benefit obligation at end of year
Consolidated financial statements
Separate financial statements
2012
2011
2012
2011
862,972 93,638 39,174 (18,758) 131,630 1,108,656
471,633 304,133 76,439 30,742 (23,122) 3,147 862,972
148,516 16,241 6,244 (5,224) 46,747 212,524
132,629 16,568 5,674 (6,355) 148,516
Long-term employee benefit expenses included in the profit or loss were as follows:
2012
2011
2012
2011
93,638 39,174 132,812
76,439 30,742 107,181
16,241 6,244 22,485
16,568 5,674 22,242
78,287 54,525
59,989 47,192
8,360 14,125
7,958 14,284
Principal actuarial assumptions at the valuation date were as follows:
Discount rate Future salary increase rate (depending on age of employee)
Consolidated financial statements
Separate financial statements
2012 2011 (% per annum) 3.7 - 4.1 3.7 - 5.0 3.0 - 7.5 3.0 - 7.5
2012 2011 (% per annum) 4.1 4.7 6.0 6.0
Amounts of defined benefit obligation for the current and previous two periods are as follows: (Unit: Thousand Baht)
Defined benefit obligation
Year 2012 Year 2011 Year 2010
Experience adjustments arising on the plan liabilities
Consolidated financial statements
Separate financial statements
Consolidated financial statements
Separate financial statements
1,108,656 862,972 471,633
212,524 148,516 132,629
68,661 -
31,203 -
25. Share capital
On 24 February 2011, the Extraordinary General Meeting of the Company’s shareholders No.1/2011 approved the reduction of the Company’s registered capital of Baht 1,312,264,222, consisting of 1,312,264,222 ordinary shares with par value of Baht 1 each to be the new registered capital of Baht 1,246,194,338, consisting of 1,246,194,338 ordinary shares with par value of Baht 1 each and approved the increase in the Company’s registered capital of Baht 307,197,070, consisting of 307,197,070 ordinary shares with par value of Baht 1 each to be the new registered capital of Baht 1,553,391,408, consisting of 1,553,391,408 ordinary shares with par value of Baht 1 each. The Company has already registered the change in share registered in the first quarter of 2011. Consequently, in the second quarter of 2011, the Company issued 295.2 million newly issued ordinary shares for Entire Business Transfer and Tender offer as stated in Note 13.3 and 13.4 respectively. In addition, the Company private placement sold 4.1 million newly issued ordinary shares with a par value of Baht 1 each, at the price of Baht 37.75 per share, totaling Baht 156 million to major shareholders of Health Network Public Company Limited. As a result of share issuance and converted the remaining convertible bonds, the Company's paid up share capital as of 31 December 2011 was Baht 1,545,458,833 (1,545,458,883 ordinary shares of Baht 1 each).
Notes to consolidated financial statements
Current service cost Interest cost Total expense recognised in profit or loss Line items under which such expenses are included in profit or loss Cost of hospital operations, sales and services Administrative expenses
Separate financial statements
135 Annual Report 2012
Consolidated financial statements
(Unit: Thousand Baht)
Notes to consolidated financial statements Annual Report 2012
136
On 20 April 2012, the Annual General Meeting of the Company’s shareholders approved the reduction of the Company’s registered capital by Baht 7,932,525, from Baht 1,553,391,408 to Baht 1,545,458,883, and approved the increase of the Company’s registered capital by Baht 154,545,888 under a general mandate, through the issue of 154,545,888 new ordinary shares with a par value of Baht 1 per share. The new registered capital will be Baht 1,700,004,771, consisting of 1,700,004,771 ordinary shares with par value of Baht 1 per share. The Company has already registered the capital increase in May 2012.
26. Dividend Dividend Final dividend for 2011
Approved by Annual General Meeting of the shareholders on 20 April 2012
Total dividend during 2012
Total dividend (Million Baht)
Dividend per share (Baht)
1,700 1,700
1.10 1.10
27. Statutory reserve
Pursuant to Section 116 of the Public Limited Companies Act B.E. 2535, the Company is required to set aside to a statutory reserve at least 5 percent of its net profit after deducting accumulated deficit brought forward (if any), until the reserve reaches 10 percent of the registered capital. The statutory reserve is not available for dividend distribution.
28. Expenses by nature
Significant expenses by nature for the years ended 31 December 2012 and 2011 are as follows: (Unit: Million Baht)
Employee expenses Doctor fee Cost of drugs and supplies Depreciation and amortisation expenses Advertising and public relation expenses Rental expenses
Consolidated financial statements
Separate financial statements
2012
2011
2012
2011
10,192.1 8,298.8 6,146.7 2,950.6 866.4 444.4
8,587.7 7,053.2 5,164.7 2,707.5 473.1 376.8
2,199.4 1,444.8 1,123.6 664.4 394.7 69.2
1,786.0 1,325.4 953.3 701.6 198.0 40.1
29. Income tax
Corporate income tax for the year ended 31 December 2012 was calculated at the rate of 23 percent (2011: 30 percent) on taxable net profit.
30. Earnings per share
Basic earnings per share is determined by dividing profit for the year attributable to equity holders of the Company (excluding other comprehensive income) by the weighted average number of ordinary shares in issue during the year.
The Company has entered into a land rental agreement for construction of an OPD building for a period of 30 years from 28 September 2004 to 27 September 2034. The first payment date is 10 October 2005 at the rental fee of Baht 50,000 per month and this fee is to be increased every 3 years. The rate will be increased by 10% of the latest rental of every 3 years. The Company has entered into a land rental agreement for a car parking for a period of 7 years from 1 September 2005 to 31 August 2012 and the rental is paid on a monthly basis. The first payment date is 1 September 2005 at the rate of Baht 131,000 per month. The rental rate will be Baht 175,000 per month starting from 1 September 2006 onward. The Company has entered into a land rental agreement for a period of 30 years from 1 January 2006 to 31 December 2035 and the rental is paid on a monthly basis. The first payment date is 5 January 2006 and rental to be paid at Baht 30,000 per month and from 1 January 2027 onward at Baht 100,000 per month. The Company has entered into an agreement to construct a hospital building on land owned by a government authority. The condition of the agreement states that upon completion of the building construction, the Company has to transfer the ownership over such building to that authority. After the authority accepts such transfer, in 2006 the Company entered into another land and hospital building rental agreement with that government authority. The agreement will cover a period of 30 years after the signing date of the agreement and the Company is obliged to pay rental on a yearly basis. The rental fee for the first 5 years is Baht 492,676 per year and this fee is to be increased every 5 years. The rental for the last 5 years will thus be Baht 990,943 per year. The Company has entered into a land rental agreement for a period of 30 years from 18 March 2011 to 17 March 2041 and the rental is paid on a monthly basis with no rental for the first 3 months. The first payment date is 18 July 2011 and rental to be paid at Baht 100,000 per month and this fee is to be increased every 3 years. The rate will be increased by 10% of the latest rental of every three years. The Company has entered into a rental agreement and a medical services agreement with a company to operate medical clinic in a building for a period of 2 years from 1 September 2011 to 27 September 2013. The Company has to pay fee at the rate stipulated in the agreement, of monthly gross operating revenue before deducted any expenses or the minimum fee stipulated in agreement whichever is higher. Samitivej Public Company Limited The subsidiary company has entered into a rental agreement for a parking building dated 10 September 2003, for 30 years, effective from 8 December 2004. The total rental fee will thus be Baht 155.1 million. The subsidiary company is committed to pay Baht 38.8 million as prepaid rental as per the schedule. The remaining rental fee will be paid on a monthly basis. In addition, the subsidiary company has entered into a service agreement with the same company for providing of services in the parking building for 30 years totaling Baht 103.4 million. The subsidiary company has entered into a medical services agreement with a company to operate medical clinic in a building for a period of 5 years from 28 May 2010. The subsidiary company has to pay fee at the rate stipulated in the agreement, of monthly gross operating revenue before deducted any expenses or the minimum fee stipulated in agreement whichever is higher.
137 Annual Report 2012
The Company The Company has entered into a land rental agreement for a car parking building for a period of 20 years from 26 February 2004 to 25 February 2024. The rental fee for the first 17 months is Baht 200,000 per month and will be increased by the rate as agreed in the agreement. The rental for the last 3 years will be Baht 560,000 per month.
Notes to consolidated financial statements
31. Long-term lease agreements
Notes to consolidated financial statements
BNH Medical Center Co., Ltd. The subsidiary company entered into an agreement with an association which is a shareholder, to lease land for the construction of a hospital for a period of 30 years, commencing 1 September 1993, with options to renew.
Annual Report 2012
138
Paolo Medic Co., Ltd. The subsidiary company entered into a land and premises rental agreement which will be expired in January 2037, and the rental fee is paid on a monthly basis at the amount as stipulated in the agreement. Phyathai 1 Hospital Co., Ltd. The subsidiary company entered into a land rental agreement with a state enterprise for a period of 3 years expiring in the year 2013 and the rental fee is paid on a monthly basis as stipulated in the agreement.
32. Commitments and contingent liabilities
As at 31 December 2012 and 2011, commitments and contingent liabilities are as follows: (Unit: Million Baht)
As at 31 December 2012 Consolidated financial statements Contractual commitments - the land and building rental contracts (including long-term agreements in Note 31) - the office equipment rental and other services - the medical equipment provision and maintenance contracts - the building construction and decoration contracts - the sale and purchase contract for land Total
Separate financial statements
Within 1 year
1 -5 years
Over 5 years
Within 1 year
1 -5 years
Over 5 years
98 270
222 97
426 -
21 29
46 9
132 -
236 748 1,352
56 3 80 458
24 450
23 267 340
55
132 (Unit: Million Baht)
As at 31 December 2012 Consolidated financial statements Contractual commitments - the land and building rental contracts (including long-term agreements in Note 31) - the office equipment rental and other services - the medical equipment provision and maintenance contracts - the building construction and decoration contracts - the sale and purchase contract for land Total
Separate financial statements
Within 1 year
1 -5 years
Over 5 years
Within 1 year
1 -5 years
Over 5 years
101 249
183 97
471 -
18 50
39 3
137 -
367 562 1,279
116 60 456
44 515
90 50 208
42
137
The Company and its subsidiaries operate mainly in the hospital business and hospital related businesses in Thailand. As a result, most of the revenues, operating profits and assets as reflected in these financial statements pertain to the aforementioned industry segment and geographic area.
34. Debentures
Movements of debentures net from debenture expenses and amortization of expenses during the year ended 31 December 2012 and 2011 are summarised below. (Unit: Thousand Baht)
Consolidated / Separate financial statements Balance beginning of year Debentures issued during the year Redemption of debenture during year Debentures expenses Amortisation of debenture expenses Balance end of year Less: Current portion of debentures Debentures - net of current portion
2012
2011
8,461,263 600,000 (770) 3,361 9,063,854 (1,999,885) 7,063,969
7,963,172 3,500,000 (3,000,000) (5,182) 3,273 8,461,263 8,461,263
On 6 March 2008, the Company had issued unsecured, named registered and unsubordinated debentures without a debentureholders’ representative for the total number of 5,000,000 units, at the price of Baht 1,000 per unit, totaling Baht 5,000 million. These debentures are divided into two tranches: the 3-year debentures for the amount of Baht 3,000 million at the coupon rate of 4.11% per annum and the 5-year debentures for the amount of Baht 2,000 million at the coupon rate of 4.84% per annum with interest payable every six-month. The Company had redeemed the 3-year debentures for the amount of Baht 3,000 million in the first quarter of 2011. On 4 June 2009, the Company had issued unsecured, name registered and unsubordinated debentures for the total number of 3,000,000 units, at the price of Baht 1,000 per unit, totaling Baht 3,000 million. These debentures are divided into two tranches: the 5-year debentures for the amount of Baht 2,000 million at the coupon rate of 4.80% per annum and the 7-year debentures for the amount of Baht 1,000 million at the coupon rate of 5.35% per annum with interest payable every six-month. Up to 31 December 2012, the Company had repurchased such debentures for amount of 30,000 units, totaling Baht 30 million. On 3 March 2011, the Company had issued unsecured, name registered and unsubordinated debentures without a debentureholders’ representative debenture for the total number of 2,500,000 units, at the price of Baht 1,000 per unit, totaling Baht 2,500 million. These debentures are 4-year debentures at the coupon rate of 3.99% per annum with interest payable every six-month.
Notes to consolidated financial statements
33. Segment information
139 Annual Report 2012
Contingent liabilities As at 31 December 2012, the Company and its subsidiary had outstanding bank guarantees of approximately Baht 198 million (2011: Baht 189 million) and the Company's was Baht 26 million (2011: Baht 25 million) issued by the bank on behalf of the Company and its subsidiary in respect of certain performance bonds as required in the normal course of business, such as facility usage and contractual performance.
Notes to consolidated financial statements Annual Report 2012
140
On 29 March 2011, the Company had issued unsecured, name registered and unsubordinated debentures without a debentureholders’ representative debenture for the total number of 1,000,000 units, at the price of Baht 1,000 per unit, totaling Baht 1,000 million. These debentures are 3-year debentures at the coupon rate of 3.78% per annum with interest payable every six-month. In August 2012, the Company had issued unsecured, name registered and unsubordinated debentures without a debentureholders’ representative debenture for the total number of 600,000 units, at the price of Baht 1,000 per unit, totaling Baht 600 million. This debenture is 10-year debentures at the coupon rate of 4.5% per annum with interest payable every six-month. Debenture agreement contains certain covenants which the Company must comply with such as financial ratios, payment of dividend and assets dispositions, etc.
35. Promotional privileges
The Company has been granted promotional privileges under The Investment Promotion Act B.E. 2520, according to the promotional certificate No. 2302(2)/2553, dated 26 November 2010, for hospital business Type 7.7. Significant privileges are as follows: - Exemption of import duty on machinery as approved by the board. - Exemption from corporate income tax derived from the promoted operation, with the limited rate of 100 percent of the investment excluding land and working capital for a period of 8 years commencing from the date that revenues are first derived from the promoted operation. In case of losses being incurred during the corporate income tax exemption period, the Company is allowed to utilise the loss as a deduction against net profits for a period of 5 years after exemption period, whether from any one year or from several years. - Exemption from income tax on dividend paid from the profit of the promoted operations throughout the tax exemption period. Wattanavej Co., Ltd. Wattanavej Co., Ltd. has been granted promotional privileges under The Investment Promotion Act B.E. 2520, according to the promotional certificate No. 1686(2)/2547, dated 25 August 2004, for hospital business Type 7.11. Significant privileges are as follows: - Exemption of import duty on machinery as approved by the board. - Exemption from corporate income tax derived from the promoted operation, with the limited rate of 100 percent of the investment excluding land and working capital for a period of 8 years commencing from the date that revenues are first derived from the promoted operation. In case of losses being incurred during the corporate income tax exemption period, the Company is allowed to utilise the loss as a deduction against net profits for a period of 5 years after exemption period, whether from any one year or from several years. - Exemption from income tax on divided paid from the profit of the promoted operation throughout the tax exemption period.
In case of losses being incurred during the corporate income tax exemption period, the Company is allowed to utilise the loss as a deduction against net profits for a period of 5 years after exemption period, whether from any one year or from several years. - Exemption from income tax on dividend paid from the profit of the promoted operation throughout the tax exemption period. A.N.B. Laboratories Co., Ltd. A.N.B. Laboratories Co., Ltd. has been granted promotional privileges under The Investment Promotion Act B.E. 2520, according to the promotional certificate No. 1913(2)/2011, dated 4 August 2011, for production of medicines and/or active ingredients in medicines. Type 6.5. Significant privileges are as follows: - Exemption of import duty on machinery as approved by the board. - Exemption from corporate income tax derived from the promoted operation, with the limited rate of 100 percent of the investment excluding land and working capital for a period of 5 years commencing from the date that revenues are first derived from the promoted operation. In case of losses being incurred during the corporate income tax exemption period, the Company is allowed to utilise the loss as a deduction against net profits for a period of 5 years after exemption period, whether from any one year or from several years. - Exemption from income tax on dividend paid from the profit of the promoted operation throughout the tax exemption period. The Company and subsidiary companies must comply with the conditions stipulated in the investment promotional privileges. Revenues of the Company and subsidiary companies for the years 2012 and 2011 can be separated between the promoted and non-promoted operation as follows: (Unit: Thousand Baht)
Consolidated financial statements Promoted operation Revenue from hospital operations Other income Total revenues
Non-promoted operation
Total
2012
2011
2012
2011
2012
2011
1,146,601 19,165 1,165,766
951,872 951,872
43,160,727 3,535,666 46,696,393
34,272,594 2,146,872 36,419,466
44,307,328 3,554,831 47,862,159
35,224,466 2,146,872 37,371,338
Notes to consolidated financial statements
- Exemption of import duty on machinery as approved by the board. - Exemption from corporate income tax derived from the promoted operation, with the limited rate of 100 percent of the investment excluding land and working capital for a period of 8 years commencing from the date that revenues are first derived from the promoted operation.
141 Annual Report 2012
Bangkok Samui Hospital Co., Ltd. Bangkok Samui Hospital Co., Ltd. has been granted promotional privileges under The Investment Promotion Act B.E. 2520, according to the promotional certificate No. 1719(2)/2547, dated 1 September 2004, for hospital business Type 7.11. Significant privileges are as follows:
(Unit: Thousand Baht)
Notes to consolidated financial statements
Separate financial statements
Annual Report 2012
142
Promoted operation 2012 2011 Revenue from hospital operations Other income Total revenues
Non-promoted operation 2012 2011
Total 2012
2011
341,128
190,257
9,660,298
8,068,582
10,001,426
8,258,839
341,128
190,257
2,854,975 12,515,273
2,501,067 10,569,649
2,854,975 12,856,401
2,501,067 10,759,906
36. Financial instruments
The Company and its subsidiaries’ financial instruments, which are defined under Thai Accounting Standard No. 107 “Financial Instruments: Disclosure and Presentation”, principally comprise the financial assets and liabilities mentioned in Note 4.17 to financial statements. The Company and its subsidiaries have the financial risks associated with these financial instruments and how they are managed is described below. 36.1 Financial risk management The Company and its subsidiaries are exposed to risk arising from changes in market interest rates and foreign currency exchange rates, and from nonperformance of contractual obligation by counterparties in the future. The subsidiaries do not use derivative instruments, while the Company uses derivative instruments as and when they consider appropriate, to manage such risks. Neither the Company nor subsidiaries hold or issue derivative financial instruments for speculative or trading purposes. 36.2 Interest rate risk The Company and its subsidiaries are exposed to interest rate risk relates primarily to its cash at banks, bank overdrafts, short-term loans, long-term loans, and debentures. However, most of financial assets and liabilities bear floating interest rates or fixed interest rates which are close to the market rate and the Company enters into interest rate swap contract to manage this risk as appropriate. The long-term loans and debentures were presented in notes 22 and 34 respectively. Interest rate swap contract Interest rate swap are used to manage exposure to fluctuations in interest rate. On 15 September 2008, the Company entered into a five-year interest rate swap contract with a financial institution which converts a floating interest rate based on the Fixed Deposit Rate plus fixed rate per annum to a fixed interest rate per annum on the long-term loan balance. The net fair value of the interest rate swap contract at the statement of financial position date was as follows: (Unit: Million Baht)
Fair value of interest rate swap contract (liabilities)
Consolidated financial statements 2012 2011
Separate financial statements 2012 2011
(11.2)
(11.2)
(20.5)
(20.5)
Fair value of interest rate swap contracts has been calculated using the rate quoted by a financial institution as if the contract was terminated at the statement of financial position date.
Significant financial assets and liabilities classified by type of interest rate are as follows:
(Unit: Million Baht)
Fixed interest rates
Financial Assets - Cash and cash equivalent - Short-term investments - Trade and other accounts receivable - Restricted financial institution deposit - Investments Financial liabilities - Bank overdrafts and short-term loans from financial institution - Trade and other payables - Long-term loans - Liabilities under finance lease agreements - Debentures
Within 1 year
1 -5 years
Over 5 years
Floating interest rate
Non-interest bearing
Total
451 211 21 683
-
-
3,120 2 3,035
19 57 4,287 13,360 17,810
3,590 268 4,287 23 13,360 21,528
1,200 3 93 2,000 3,296
2,506 86 6,464 9,056
600 600
25 6,939 6,964
3,614 3,614
1,225 3,614 9,448 179 9,064 23,530 (Unit: Million Baht)
As at 31 December 2011 Consolidated financial statements Fixed interest rates
Financial Assets - Cash and cash equivalent - Short-term investments - Trade and other accounts receivable - Long-term deposit at financial institution - Restricted financial institution deposit - Investments
Within 1 year
1 -5 years
Over 5 years
Floating interest rate
510 418 12 940
50 50
-
3,140 13 3,153
Non-interest bearing
Total
226 46 3,377 7,865 11,514
3,876 464 3,377 50 25 7,865 15,657
143 Annual Report 2012
Consolidated financial statements
Notes to consolidated financial statements
As at 31 December 2012
(Unit: Million Baht)
As at 31 December 2011
Notes to consolidated financial statements
Consolidated financial statements Fixed interest rates
Financial liabilities - Bank overdrafts and short-term loans from financial institution - Trade and other payables - Long-term loans - Liabilities under finance lease agreements - Debentures
1 -5 years
Over 5 years
Floating interest rate
Non-interest bearing
Total
-
-
4 150 154
9 185 8,461 8,655
-
231 7,751 7,982
3,391 3,391
231 3,391 7,764 335 8,461 20,182 (Unit: Million Baht)
As at 31 December 2012 Separate financial statements Fixed interest rates
144 Annual Report 2012
Within 1 year
Financial Assets - Cash and cash equivalent - Trade and other receivables - Short-term loans to related parties - Long-term loans to related parties - Investments Financial liabilities - Bank overdrafts and short-term loans from financial institutions - Trade and other payables - Short-term loans from related parties - Long-term loans - Liabilities under finance lease agreements - Debentures
Within 1 year
1 -5 years
Over 5 years
Floating interest rate
Non-interest bearing
Total
-
-
-
1,564 207 5,325 7,096
3 962 34,429 35,394
1,567 962 207 5,325 34,429 42,490
1,200 6 2,000 3,206
2,500 11 6,464 8,975
600 600
2,797 6,575 9,372
961 961
1,200 961 2,797 9,075 17 9,064 23,114
(Unit: Million Baht)
As at 31 December 2011
Financial Assets - Cash and cash equivalent - Trade and other receivables - Short-term loans to related parties - Long-term loans to related parties - Investments Financial liabilities - Trade and other payables - Short-term loans from related parties - Long-term loans - Liabilities under ďŹ nance lease agreements - Debentures
Within 1 year
1 -5 years
Over 5 years
Floating interest rate
170 60 230
-
-
1,517 137 1,606 3,260
3 829 30,537 31,369
1,520 829 307 1,666 30,537 34,859
-
-
-
1,628 3,142 4,770
943 943
943 1,628 3,142 10 8,461 14,184
3 3
7 8,461 8,468
Non-interest bearing
Total
36.3 Foreign currency risk The Company and its subsidiaries are exposed to foreign currency risk mainly in respect of purchase of medical tools and equipment and sales of goods transactions which are denominated in foreign currencies. A subsidiary company seeks to manage this risk by entering into forward exchange contracts. Generally, the forward contracts mature within one year. Forward exchange contract As at 31 December 2012 and 2011, a subsidiary company has the outstanding balance of forward exchange contracts were as follows: Balance as at 31 December 2012 31 December 2011
Foreign currency US Dollar US Dollar Euro
Amount bought
Contractual exchange rate for amount bought
255,442 482,588 3,465
(Baht per foreign currency unit) 30.89 - 31.14 30.75 - 31.63 41.52
145 Annual Report 2012
Fixed interest rates
Notes to consolidated financial statements
Separate ďŹ nancial statements
Notes to consolidated financial statements Annual Report 2012
146
36.4 Credit risk The Company and its subsidiaries are exposed to credit risk primarily with respect to trade accounts receivable, loans, bill of exchange and other receivable. The Company and its subsidiaries manage the risk by adopting appropriate credit control policies and procedures and therefore do not expect to incur material financial losses. In addition, the Company and its subsidiaries do not have high concentration of credit risk since it has a large customer base. The maximum exposure to credit risk is limited to the carrying amounts of receivables, loans and other receivables as stated in the statement of financial position. 36.5 Fair values of financial instruments Since the majority of the Company’s and its subsidiaries’ financial instruments bear floating interest rates or fixed interest rates which are close to market rate, their fair value is not expected to be materially different from the amounts presented in the statement of financial position. A fair value is the amount for which an asset can be exchanged or a liability settled between knowledgeable, willing parties in an arm’s length transaction. The fair value is determined by reference to the market price of the financial instrument or by using an appropriate valuation technique, depending on the nature of the instrument.
37. Capital management
The primary objective of the Company’s and its subsidiaries’ capital management is to ensure that it has appropriate capital structure in order to support its business and maximise shareholders value. As at 31 December 2012, the Group's debt-to-equity ratio was 0.8:1.0 (2011: 0.8:1.0) and the Company's was 0.9:1.0 (2011: 0.6:1.0).
38. Litigation
38.1 Litigation 2012 In the second quarter of 2012, 5 people who claimed that they are shareholders of the Company (the “Shareholders”) filed a petition with the Civil Court requesting cancellation of the resolutions of Agenda Item 5 - To consider the appointment of directors to replace those retired by rotation at the 2012 Annual General Meeting of Shareholders and to reconvene the Shareholders' Meeting to consider the appointment of directors to replace those retired by rotation. The material claims made by the Shareholders in their petition were that the resolutions of the 2012 Annual General Meeting of Shareholders were against the Articles of Association of the Company, Public Limited Company Act B.E. 2535, and Securities and Exchange Act B.E. 2535, and were unfair, exploitative, and caused damages to the Shareholders. Legal counselor of the Company gathered information, including the procedures for arranging meetings, and had opinion that calling the 2012 Annual General Meeting of Shareholders, and its procedures, proposing that the Shareholders consider all agenda items, including the agenda item 5 to consider the appointment of directors to replace those retired by rotation took place in compliance with the laws and the Company’s Articles of Association, and were lawfully implemented in all respects. The Meeting of Shareholders considered and approved all agenda items with majority votes, including Agenda Item 5 - To consider the appointment of directors to replace those retired by rotation. In Agenda Item 5, 7 people were proposed to the Shareholders’ Meeting as directors to replace
38.2 Litigation 2011 In the second quarter of 2011, claimants consisted of 5 persons who claimed that they are shareholder of the Company filed a petition to the court - claiming that the Company held the ordinary shareholders' meeting of 2011 illegally and in violation of the Article of Association of the Company due to the change of voting method. The Claimants requested the Court to revoke the Resolution of the Shareholders' Meeting of 2011 which the Company has filed an objection by stating that the Company did not change the voting method and the Company held the Ordinary Shareholders' Meeting correctly in accordance with the Article of Association of the Company, the laws and the Regulations of the Stock Exchange of Thailand that the Company always follows and considering the importance of the right of each shareholder. During the court process, the five Claimants and the Company have the settlement agreement where the Company will hold the Ordinary Shareholders' Meeting in April 2013 for the shareholders to consider and cast the vote on the agendas as set out by the laws and the both parties shall honor the resolutions of the Meeting, and the five Claimants agreed to drop their Petition and not to revoke the Resolutions of the Shareholders' Meeting of 2011. The Parties all agreed with such settlement without demanding for the Court fee. After considering that the Settlement Agreement is in accordance with the laws, the Court granted its judgement in accordance with the Settlement Agreement.
39. Events after the reporting period
Established new subsidiary company In February 2013, the Company has established a new subsidiary company, namely Bangkok Hospital Khon Kaen Company Limited, to operate a hospital business in Khon Kaen province. This company has Baht 600 million of registered capital and the Company holds 100 percent.
Notes to consolidated financial statements
In addition, the Company has a contingent liability as a result of being sued for unfair dismissal with the disputed amount of Baht 415 Million, since the Company hired a retired high-level executive under a consultant contract with agreed period. The Company did not renew the contract upon expiration; therefore, the Advisor sued the Company. Currently, the case is in legal process by the central labour court. The Company has not recorded the liability in the financial statements since the management believes that there is uncertainty regarding the legal case and the Company has lawfully complied with the contract. In addition, Legal counselor of the Company has the opinion that this case is not unfair dismissal since the consultant contract already expired and not was renewed. Therefore, the case is fully complied with the law.
147 Annual Report 2012
the 5 directors who were to retire by rotation. The Shareholders’ Meting resolved to approve the appointment of 5 people nominated by the Board of Directors, who received 1st to 5th place votes to be directors to replace those retired by rotation, with majority votes. In addition, the Company complied with the resolutions obtained at the meeting, and registered the change of directors of the Company with the Department of Business Development, Ministry of Commerce, on 3 May 2012. The case is in legal process, but the management expects that this case will not result in changes to the resolutions.
Notes to consolidated financial statements Annual Report 2012
148
Acquisition of shares in Khrungdhon Hospital Public Company Limited On 25 January 2013, the meeting of the Board of Directors of Royal Bangkok Healthcare Co., Ltd., a subsidiary company, approved the acquisition of shares in Krungdhon Hospital Public Company Limited. The subsidiary company has acquired 3,741,612 shares in such company, representing 24.94 percent of the total issued shares of the company from the existing shareholders at a price of Baht 55 per shares totaling Baht 205.79 million. As a result, the Company and a subsidiary company totally hold 44.96 percent of the total issued shares in Krungdhon Hospital Public Company Limited. In addition, on 7 February 2013, Royal Bangkok Healthcare Co., Ltd. submitted a tender offer proposal to purchase securities of Krungdhon Hospital Public Company Limited at a price of Baht 55. The tender offer period is from 11 February 2013 to 18 March 2013.
40. Approval of financial statements
These ďŹ nancial statements have been authorised for issue by the Company’s Board of Directors on 27 February 2013.
Health Care Business
Location
2 Soi Soonwijai 7, New Petchaburi Road, Bangkapi, Huay Kwang, Bangkok 10320 Telephone 1719, 02-310-3000 Fax 02-310-3252, 02-310-3327
Company Registration Number
BorMorJor. 0107537000025
Website
www.bangkokhospital.com
Registered Capital
Baht 1,700.00 million with Baht 1,545.46 million in paid-up capital, divided into 1,545.46 million common shares with par value of Baht 1 each
Reference Information Securities Registrar
Thailand Securities Depository Co., Ltd. 4th Floor, Stock Exchange of Thailand Building, 62 Ratchadaphisek Road, Klongtoey, Bangkok 10110 Telephone 02-229-2800, 02-654-5599 Fax 0-2359-1259
Bond Registrar
TMB Bank Public Company Limited 10th Floor, 393 Silom Road, Silom, Bangrak, Bangkok 10500 Telephone 02-230-5878, 02-230-5756 Fax 02-230-6093
Bond Representative
KasikornBank Public Company Limited Securities Service Department 400/22 Kasikorn Bank Building, 11th Fl., Paholyotin Road Samsennai, Phayathai, Bangkok 10400 Telephone 02-470-1952, 02-470-3687 Fax 02-470-3684
Auditor
Ernst & Young OfďŹ ce Co., Ltd. 33rd Floor, Lake Rajada Building, 193/136-137 Ratchadaphisek Road, Klongtoey, Bangkok 10110 Telephone 02-661-9190, 02-264-0777 Fax 02-661-9192, 02-264-0789-90
149 Annual Report 2012
Type of Business
General Information
General Information
Juristic persons in which the company holds 10% of shares or greater
Juristic persons in which the company holds 10% of shares or greater as at December 31, 2012
Annual Report 2012
150
Name
Date Registered
Location
Business
Shares issued and paid-up
% held
1 Bangkok Hospital Chaingmai Co., Ltd.
22/Jun/12
2 Soi Soonwijai 7 New Petchaburi Rd. Bangkok
Private Hospital
100,000,000 Par value Baht 10/share
100.00%
2 Bangkok Hospital Udon Co., Ltd.
26/Jul/12
111 Thongyai Rd. Mak Khaeng, Muang, Udon Thani
Private Hospital
50,000,000 Par value Baht 10/share
100.00%
3 Prasit Patana Plc. (PPCL)
24/Jan/74
943 Paholyothin Road Samsennai, Phyathai Bangkok
Holding Company
1,108,208,020 Par value Baht 1/share
98.32%
4 Phaya Thai 1 Hospital Co., Ltd. Held trough PPCL
11/Dec/01
364/1 Sri Aduddaya Rd. Phayathai Radjdhevee Bangkok
Private Hospital
48,100,000 Par value Baht 10 / share
100.00%
5 The Phaya Thai 2 Hospital Co., Ltd. Held trough PPCL
15/Sep/07
943 Phaholyothin Rd. Samsennai, Phyathai Bangkok
Private Hospital
22,511,351 Par value Baht 10/share
99.15%
6 The PhayaThai 3 Hospital Co., Ltd. Held trough PPCL
24/Sep/96
111 Phet Kasem Rd. Pak Khlong Tarat Phasi Charoen, Bangkok
Private Hospital
Common share5,442,995 Prefer share 3,750,000 Par value Baht 10/share
7 Sriracha Nakorn General Hospital PLC. Held trough PPCL . 8 Paolo Medic CO.,LTD.
17/Feb/97
90 Sriracha Nakorn Rd., 3 Sriracha Sriracha, Chonburi Province
Private Hospital
35,954,180 Par value Baht 10/share
66.53%
670/1 Phaholyothin Rd. Samsennai, Phyathai Bangkok
Private Hospital
30,000,000 Par value Baht 10/share
99.99%
9 Paolo Samut Prakran Co., Ltd.
30/Jan/92
123 Srinakarin Rd., Tambon Banmueng, Ampor Mueng Samut Prakran Province
Private Hospital
8,400,000 Par value Baht 5/share
93.30%
10 Siam Medical Co., Ltd.
17/Jul/70
1 Chokchai Rd, 4 Lat Phrao Khet Lat Phrao Bangkok
Private Hospital
Common Share 8,700,000 Prefer share 1,300,000 Par value Baht 10/share
85.17% 89.13%
11 Thai Medical Center PLC.
27/Jan/36
44/505 Navamin Rd. Khet Bueng Kum Bangkok
Private Hospital
200,538,671 Par value Baht 10/share
99.76%
12 Bangkok Hospital Khao Yai Co., Ltd.
18/Jul/07
2 Soi Soonwijai 7 New Petchaburi Rd. Bangkok
Private Hospital
7,000,000 Par value Baht 10/share
100.00%
13 Bangkok Hospital Samui Co., Ltd.
14/Aug/03
57 Moo 3, Bor Pud Samui Island Suratthani Province
Private Hospital
15,000,000 Par value Baht 10/share
100.00%
14 Bangkok Hospital Rayong Co., Ltd.
13/Aug/02
8 Moo 2, Soi Saengchanniramit Nern Pra, Muang Rayong Province
Private Hospital
40,000,000 Par value Baht 10/share
100.00%
15 Bangkok Hospital Trad Co., Ltd.
25/Jan/94
276 sukhumvit Road Muang, Trad Province
Private Hospital
50,000,000 Par value Baht 5/share
99.76%
16 Wattanavej Co., Ltd.
28/Oct/83
25/14 Thaluang Road Muang, Chantaburi Province
Private Hospital
18,000,000 Par value Baht 10/share
99.69%
17 Bangkok Hospital Phuket Co., Ltd.
15/Mar/94
2/1 Hongyokuthit Road Muang, Phuket Province
Private Hospital
100,000,000 Par value Baht 5/share
99.68%
18 Bangkok Hospital Had yai Co., Ltd.
27/Jul/95
75 Soi 15 Petchkasem Road Muang, Songkla Province
Private Hospital
100,000,000 Par value Baht 5/share
98.79%
19 Bangkok Hospital Pattaya Co., Ltd.
1/May/89
301 Sukhumvit Road km 143 Pattaya Chonburi Province
Private Hospital
28,000,000 Par value Baht 10/share
97.27%
20 Samitivej Plc. (SVH)
28/Dec/76
133 Sukhumvit 49 Klongtan, Wattana Bangkok
Private Hospital (Samitivej Sukhumvit, Samitivej Srinakarin)
100,000,000 Par value Baht 10/share
95.76%
8 Soi Laemkate Choem Chormphon Rd. Si Racha, Si Racha, Chon Buri
Private Hospital (Samitivej Sukhumvit, Samitivej Srinakarin)
18,751,000 Par value Baht 10/share
68.06%
21 Samitivej Sriracha Co., Ltd. Held through SVH
8/Oct/86
9/Apr/01
98.20% 100.00%
22 BNH Medical Center Co., Ltd. (BNH)
27/Aug/91
9/1 Convent Road Silom, Bangrak
Private Hospital
58,611,935 Par value Baht 10/share
91.48%
23 Bangkok Hospital Ratchasima Co., Ltd.
24/Nov/92
1308/9 Mitraparp Road Nai Muang, Muang Nakornratchasima Province
Private Hospital
30,000,000 Par value Baht 10/share
90.36%
24 Bangkok Hosital Prapradaeng Co., Ltd.
7/Sep/93
288 Suksawat Muang Samutprakarn Province
Private Hospital
10,500,000 Par value Baht 10/share
79.00%
20/Dec/05
National Road No.6, Kruos Village, Svay Dangkom Commune, Siem Reap District, Siem Reap Province, Cambodia.
Private Hospital in Camobia
10,000 Par value USD1,000/share
80.00%
1/Jun/07
No.11, Street 592, Sangkat Boeung Kak 2, Khan Toul Kok, Phnom Penh, Cambodia.
Private Hospital in Cambodia
6,500 Par value USD 1,000/share
70.00%
25 Angkor Pisith Co., Ltd. 26 Royal Rattanak Medical Services Co., Ltd.
Location
27 Phnom Penh Medical Services Co., Ltd.
27/Nov/06
Toeuk Thla Village, Russian Federation Blvd., Sangkat Toeuk Thla, Khan Russey Keo, Phnom Penh, Cambodia.
28 B.D.M.S. International Medical Services Co., Ltd.
20/Dec/05
61A Street 214, Sangkat Beong Rang, Khan Don Peh, Phnom Penh, Cambodia.
29 S.R.Property Investment Co., Ltd.
20/Dec/05
30 Siem Reap Land Investment Co., Ltd.
10/Feb/06
31 Phnom Penh First Property Co., Ltd.
27/Nov/06
517 Road No.6, Phum Salakanseng, Khum Svay Damdum, Srok Khet, Siem Reap, Cambodia. 517 Road No.6, Phum Salakanseng, Khum Svay Damdum, Srok Khet, Siem Reap, Cambodia. No.61 Street 214, Sangkat Beong Rang, Khan Don Peh, Phnom Penh, Cambodia.
32 Bio-Molecular Laboratories (Thailand) Co., Ltd.
7/Nov/01
2 Soi Soonwijai 7 New Petchaburi Rd. Bangkok
33 National Healthcare Systems Co., Ltd. Held through SVH and BNH 25.97%
25/Jul/01
34 Asia International Healthcare Co., Ltd. (AIH)
17/Jul/03
35 Al Ghaith Bangkok Dusit Management Services LLC. Held through (AIH)
1/Jun/07
Business Private Hospital in Cambodia (Not yet in operations) Private Hospital in Cambodia (Not yet in operations)
Shares issued and paid-up
% held
10,000 Par value USD1,000/share
100.00%
1,000 Par value KHR 9,200,000/share
100.00%
Land Holding Company
1,000 Par value KHR 20,000/share
49.00%
Land Holding Company
1,000 Par value KHR 20,000/share
49.00%
Land Holding Company
1,000 Par value KHR 20,000/share
49.00%
Bio molecular laboratories
1,000,000 Par value Baht 10/share
95.00%
2301/2 Soi Soonwijai 7 New Petchaburi Rd. Bangkok
Share service company
7,500,000 Par value Baht 10/share
74.02%
2 Soi Soonwijai 7 New Petchaburi Rd. Bangkok AI Gaith Tower 14th Floor, Office Number 1401, Hamdan Street, Abu Dhabi, United Arab Emirates
Holding Company
3,500,000 Par value Baht 10/share
100.00%
Private Hospital in UAE
10,000 Par value AED 1,000/share
30.00%
36 Greenline Synergy Co., Ltd.
18/Aug/08
2301/2 อาคารศูนยทันตกรรม ถนนเพชรบุรีตัดใหม กรุงเทพฯ
Information technology
20,000,000 Par value Baht 10/share
100.00%
37 Royal Bangkok Healthcare Co., Ltd.
11/Feb/08
2 Soi Soonwijai 7 New Petchaburi Rd. Bangkok
Holding Company Holds shares of A.N.B Laboratories Co., Ltd.
73,600,000 Par value Baht 10/share
100.00%
115,000 Par value Baht 1,000/share
100.00%
38 A.N.B. Laboratory Co., Ltd.
1/Jun/04
39/1 Ram-Indra Road Kannayao Bangkok
Manufacture and distribution of medicine
39 Bangkok Health Insurance Co., Ltd.
2/Jan/81
2 Soi Soonwijai 7 New Petchaburi Road Bangkok
Health insurance
10,500,000 Par value Baht 10/share
99.93%
2,000,000 Par value Baht 10/share
99.94%
10,000 Par value Baht 100/share
100.00%
Held through Royal Bangkok Healthcare Co., Ltd.
40 Bankok Premier Life Insurance Co., Ltd.
29/Aug/10
2301/2 New Petchaburi Road Bangkok
Insurance Broker
41 New Petchburi Medical Services Co., Ltd.
20/Dec/02
2 Soi Soonwijai 7 New Petchaburi Road Bangkok
Dormant Company
42 Medicpharma Co., Ltd.
26/Aug/71
124 Thonburi-Parktor Road Bangkok
Manufacture and distribution of medicine
2,143,000 Par value Baht 10/share
49.00%
43 Bangkok Helicopter Services Co., Ltd.
29/Jun/95
1111 Ploenchit Road Lumpini, Patumwan Bangkok
Air medical transport
10,000,000 Par value Baht 10/share
49.00%
44 Cool & Joy Co., Ltd.
20/May/03
2 Soi Soonwijai 7 New Petchaburi Road Bangkok
Public relations and marketing support
500,000 Par value Baht 10/share
30.00%
45 Ramkhamhaeng Hospital Plc. ***
25/Aug/86
2138 Ramkhamhaeng Road Bangkapi Bangkok
Private Hospital
12,000,000 Par value Baht 10/share
38.24%
46 Bumrungrad Hospital PLC.
15/Dec/89
33 Sukumvith Rd., Soi 3 Klong Tun Nua Wattana, Bangkok
Private Hospital
Common share 728,383,622 Par value Baht 1/share
23.88%
47 Krungthon Hospital Co., Lt.d
7/Jan/93
337 Somdej Prachao Thaksin Rd. Thonburi Bangkok
Private Hospital
15,000,000 Par value Baht 10/share
20.01%
48 Udorn Pattana Co., Ltd. *** Held trough PPCL and RAM 19.33%
9/Jun/94
555/5 Posri Road Muang Udornthani Province
Private Hospital
30,000,000 Par value Baht 1/share
15.26%
49 BDMS Training Co., Ltd.
23/Sep/10
2 Soi Soonwijai 7 New Petchaburi Road Bangkok
Training Cneter for staff within the network
100,000 Par value Baht 10/share
100.00%
50 Irving Sheridan SE Co., Ltd. Held through SVH
14/Nov/02
488 Srinakarin Road Suanluang Bangkok
Asset management
10,000 Par value Baht 10/share
96.03%
51 First Health Food Co., Ltd. Held through SVH
23/Mar/04
488 Srinakarin Road Suanluang Bangkok
Restaurant and health food
1,400,000 Par value Baht 10/share
99.99%
52 Sodexo Healthcare Support Service (Thailand) Co., Ltd. Held through First Health
15/May/04
23/93 Sornchai Building Soi Sukhumvit 63 Wattana, Bangkok
Other services
150,000 Par value Baht 100/share
74.00%
Note : ***The Company is shareholder only and is not involve in management of the business
Juristic persons in which the company holds 10% of shares or greater
Date Registered
151 Annual Report 2012
Name
BANGKOK DUSIT MEDICAL SERVICES Public Company Limited 2 Soi Soonvijai 7 New Phetchburi Rd., Bangkok, Thailand 10310 Tel. 66-2310-3000 Fax. 66-2318-1546 www.bangkokhospital.com