Pico::Annual Report 2009

Annual Report 2009 Pico (Thailand) Public Company Limited

Event Marketing

MICE

Knowledge Communication

Contents 2 4 5 8 9

1 3 4 7 8

Financial Highlights Financial Highlights Message from the Chairman Message from the Chairman Message from Chief Executive Officer Message from Chief Executive Officer Audit Committee Report Audit Committee Report Board Directors Board ofof Directors

1211 1615

Part I ExecutiveSummary Summary Part I Executive Part SecurityIssuing IssuingCompany Company Part II IISecurity

1716 1918

Risk Factors  Risk Factors

2423 3029

DescriptionofofServices Services  Description

3130 3332

AssetsEmployed Employedininthe theConduct Conduct of of Business Business  Assets

3433

LegalDispute Dispute  Legal

3534

CapitalStructure Structure  Capital

3635

Management  Management

5150

InternalControl Control  Internal

5453

 Intercompany IntercompanyTransactions Transactions

5554

 Operating OperatingResults Resultsand andFinancial Financial Position Position

6160

 Other OtherInformation Information

6261

Part IIIIIICertification Part Certificationof ofFactual Factual Accuracy Accuracy

6564 6867

Attachment ononExecutives ofthe theCompany Company AttachmentI I Details Details Executivesand andAuthorized Authorized Managers Managers of Attachment Subsidiariesand and AttachmentII II Details DetailsononDirectors Directorsofofthe theCompany, Company, Subsidiaries Associated AssociatedCompanies Companies

6968

Attachment Accountantsand and AttachmentIIIIII Report Reportofofthe theIndependent IndependentCertified Certified Public Public Accountants Financial Statements Financial Statements

ScopeofofBusinesses Businesses  Scope Researchand andDevelopment Development  Research FuturePlan Plan  Future

Financial Highlights

Total Assets (Baht Million)

Revenues (Baht Million)

429

527

627

598

420

714

1,109

1,035

1,008

583

2005

2006

2007

2008

2009

2005

2006

2007

2008

2009

Shareholders’ Equity (Baht Million)

Net Income (Loss) (Baht Million)

42 284

318

328

346

297

2005

2006

2007

2008

2009

Net Book Value per Share (Baht)

2.48

2.78

2.86

3.02

2.59

2005

2006

2007

2008

2009

Dividend per Share (Baht)

0.31

0.37

0.30

0.38

0.18

2005

2006

2007

2008

2009

71

50

64 (30)

2005

2006

2007

2008

2009

Financial Ratio (%)

2005

2006

2007

2008

2009

Earnings (Losses) per Share (Baht)

0.36

0.62

0.44

0.56

2005

2006

2007

2008

(0.26) 2009

Financial Highlights

12

From live events to permanently themed environments, Pico activates the most powerful brand experiences in every communication channel for every audience. Pico inspires and excites with lateral thinking and a fresh approach to bring global brands alive. Every brand offers its own experience, intangible assets, reputation, image, exclusiveness, and a promise of value.

Our understanding of this compelling truth stimulates innovative and surprising ideas and concept executions that bring new energy to every brand.

2

Message from the Chairman

First, I would like to express our appreciation to all of you who always trust in Pico (Thailand) Public Company Limited. Today, the Company is now in its 27th year of operation. We continue to grow strongly and confidently in both financial status and our people. This has been done under an excellent support from Pico Group, which has a network that expanded all over the world with more than 34 offices across the globe.

In order to emphasize our potential and status as one of the leaders in the business, Pico Group and Pico (Thailand), has expanded our service lines to cover various kinds of clients’ requirements.

Pico never stop developing. Our service is not scoped only in Event Marketing, but our services have continuously expanded to response to the various requirements from our clients. This is done to achieve the main objective of doing marketing to activate the brand of our clients to be renowned, remembered, accepted, and trustable.

For Pico, Total Brand Activation is regarded as a promise that the Company will give our clients a guaranteed quality of service at a highest level. As the service from Pico is not just the set up of activities, but it also includes creativity of experience that our clients can transfer to their target groups of audience in order to differentiate their brands.

Today, Pico is proud to present our new position as the professional in Total Brand Activation service provider, which means our service is to activate the brand of our clients through the various means of communication techniques and innovative tools in order to create the uniqueness to our clients’ brand.

As for the past year, I would like to thank all our shareholders for showing your confidence in our company. I would also like to thank our business partners for good collaborations. I also would like to expand my thankfulness to all businesses in this marketing service sector that make this industry grow strongly. Last but not least, thank you to all our staff for putting their best effort in driving the Company to grow sustainably.

Total Brand Activation, therefore, is the new direction and our promise that Pico has held as the vision and the policy for doing our business.

Thank you very much

………………………

(Mr. Chia Song Heng) Chairman of the Board

………………………….

(Pised Chungyampin) Executive Chairman

Message from the Chairman

34

Message from Chief Executive Officer

Another year has passed, on behalf of Pico (Thailand) Public Company Limited, I would like to pass my sincere appreciation to all those who have shown trust in the Company throughout the year. As we all know, the economy has been in the recession and it has affected many businesses in various aspects. Service Sector, as a support business unit, is one of those that have major affected by the economical downturn.

However, Pico (Thailand) Public Company Limited has foreseen and planned ahead to handle such crisis, including any changes that may occur in the future. Therefore, the Company continues to expand the lines of services as well as generating new markets in order to create new needs and excitements in a society. Knowledge Communication, in particular, is one of Company’s services that we strongly believe in the business potential. The benefit of Knowledge Communication will not only generate income to the Company, but will also benefit the society in general. This is because in any society, knowledge plays an important role for success, thus, we believe in the potential of the growth in Knowledge Communication area.

However, to see the successful of growth of this particular area, time is the required factor. During the past years, we have laid a solid foundation and provided all supports it needed.

Although the business in this field is not yet in a mature state, I believe that with a solid base and clear vision, we have plenty of potential to explore this path. We will definitely be able to turn it into a beautiful path that leads many good things both to the Company and to our society.

In the previous year, Pico (Thailand) has constantly generated creative works for our clients. Among the highlights, The 30th Bangkok International Motor Show is one of the standouts in which Pico has created booths for many leading auto makers. We also support The National Science and Technology Fair 2009 to help raising the level of the event from a science week to a national event. In doing so, the event not only attracted students, but also received plenty of interest from professionals in various fields. Another highlight of Pico this year is the event that the Company joined with Faculty of Education, Burapha University, in organizing the first International Conference on Teaching and Learning EDUCA 2009. The event allowed teachers from all over the country to share their expertise and this is an example of creativity in Knowledge Communication that we are aiming for.

54

Message from Chief Executive Officer

As for our 2009 financial report, even though it may not shown surprising results like last year, I believe that we have learned so many things that allowed us to be more flexible to changes that may come our way. We are more equipped in terms of our personnel’s potential and quality. For our company, our staff is the most valuable asset and we always stress on the importance of work-life balance. We stand on our beliefs to treat everyone with fairness and reasons. I strongly believe that Pico (Thailand) is still full of potential and creativity and we are ready to bring innovations to our society Finally, I would like to pass my sincere appreciation to all of our shareholders for the constant trust that all of you have shown in Pico (Thailand) Public Company Limited throughout the year. I would also like to thank our partners for always showing the supports and corporations.

Last but not least, I would like to thank our team for helping our company to achieve the best we can possibly do. I truly believe that 2010 will be a very successful year for all of us. Again, thank you very much for 2009.

………………………………..

Silchai Kiatpapan Chief Executive Officer

Message from Chief Executive Officer

56

Audit Committee Report

To the Shareholders of Pico (Thailand) Public Company Limited The Audit Committee of Pico (Thailand) Public Company Limited consists of Mr. Chaiyod Bunyagidj as Chairman, Mr. Sern Vithespongse and Mrs. Sasitorn Phongsatorn as members of the Committee.

The Audit Committee performs its duty and responsibility pursuant to the delegation of the Board of Directors. In 2009, there are 8 meetings held with the executive management and the independent auditor for all related agenda. The summary of operating results of the Audit Committee is as follows : Financial Report Preparation, the Committee diligently reviewed the quarterly and annual financial report for 2009 with the executive management and the independent auditor to ensure that the consolidated statements are fairly presented in accordance with the generally accepted accounting principles and disclosures are accuracy and adequacy. The Committee reviewed intercompany transactions to be a normal course of business and to be complied with the rules and regulations of the Stock Exchange of Thailand.

Internal Control, the Committee reviewed an internal control with the executive management and the independent auditor to ensure that the Company has a reliable internal control. In addition, the Committee provided an observation and constructive comments on material matters according to the internal audit report for improvement of operations to be more effective and efficient and each operational department to have an adequate control process in place.

Risk Management, the executive committee and the executive management realized the importance of risk management. They appointed a dedicated risk management system to present and reduce risks that may affect the Company’s performance.

Related Transactions, the Committee reviewed all related transactions to ensure that they were conducted at arms length and is strictly normal trade transactions that the Company closely abides by its commitment to good governance.

Compliance, the Committee reviewed transactions for compliance to the rules and regulations of the Stock Exchange of Thailand and other related business laws. Complete compliance is noted.

Good Governance, the Company is found to abide by its commitment to the concept of good governance. Its operation is conducted in a transparent and accountable manner with all stakeholders’ interest in mind.

The Committee also reviewed the selection of the independent auditor for the Board of Directors to present to the shareholders for ratification. Mrs. Nachalee Boonyakarnkul, Certified Public Accountant No. 3126, and/or Mr. Niti Jungnitnirundr Certified Public Accountant No. 3809 and/or Miss Wimolporn Boonyusthian Certified Public Accountant No. 4067of Deloitte Touche Tohmatsu Jaiyos Audit Co., Ltd. are recommended to be elected as the Company’s independent auditor for 2010 with a stipend of Baht 1,938,000.

On behalf of the Audit Committee

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

(Mr. Chaiyod Bunyagidj) Chairman of the Audit Committee Pico (Thailand) Public Company Limited

Audit Committee Report

78

Board of Directors

As of October 31, 2009, the Company has 8 board of directors members as follows : 1.

2.

3.

4.

5.

6.

7.

8.

98

Mr. Chia Song Heng Mr. Pised Chungyampin Mr. Silchai Kiatpapan Mr. Chung Chee Keong Mr. Viriya Pholpoke Mr. Chaiyod Bunyagidj Mr. Sern Vithespongse Mrs. Sasitorn Phongsathorn

Board of Directors

Chairman Vice Chairman Director Director Director and Executive Advisor Independent Director and Chairman of the Audit Committee Independent Director and Audit Committee Member Independent Director and Audit Committee Member

Part I Executive Summary Pico (Thailand) Public Company Limited was established on March 15, 1992 and registered in Market for Alternative Investment (MAI) on April 19, 2004. Pico (Thailand) Public Company Limited is a network company of Pico Far East Holding Limited, which is a world-leading company in providing architectural services and event organization.

Pico Far East Holding Limited has a vast network of 34 branches in 26 countries worldwide.

The Company is among the leaders in Thailand’s event marketing industry with more than 20 years of experience. The Company is well-known for its one-stop service with strong domestic and international network, which gives the Company’s strength in order to be recognized as one of the leaders in global event marketing industry.

The Company has invested in companies that are complement and related to Company’s operations such as design companies. Such companies are ones of the best in their fields. By subsidizing companies in related fields helps the Company to provide better and more efficient service. The subsidiaries of the Company are PX System Company Limited, Multi Designs Company Limited, NOX Bangkok Company Limited, Inkjet Images (Thailand) Company Limited, Ibrix Company Limited, and DesignLab MISC Company Limited.

The services provided by the Company are including organizing of (1) Meeting, Incentive, Convention, and Exhibition (MICE), (2) Event Marketing and Brand Image Building, as well as (3) Knowledge Communication. The main customers of the Company are in vary industries include government sector, private sector, and international customers.

For the private sector, the main businesses that the Company has continually given the service to are the automotive and the information and communication technology groups. Event Marketing is the main service that the Company has provided for these customers. Regarding to the government sector, Knowledge Communication, e.g. museum and exhibition, is the major service.

Among the highlights of that the Company has done in year 2009 are the 30th Bangkok International Motor Show 2009 which the Company has worked with outstanding car companies, and National Science and Technology Fair 2009 which the Company lift the show up to national show as well as educational international conference EDUCA 2009 which is one of our knowledge communication services.

Part I Executive Summary

12 11

The world economic crisis, uncertainty of political matter in Thailand, and H1N1 flu outbreak in year 2009 have significantly impacted to operations, decreased in comparison with last year operation. For the year ended October 31, 2009, the Company has revenues of Baht 589 million with its gross profit of Baht 125 million, net loss of Baht 30 million and net loss per share of Baht 0.26.

However, the Company is still very strong in the financial position and has sufficient funds. As of October 31, 2009, the Company has paid-up capital of Baht 115 million consisting of 330,000 preferred shares valued at 1 baht each and 114,669,980 ordinary shares valued at 1 baht each. Total assets are Baht 420 million, total liabilities of Baht 124 million and shareholders’ equity of Baht 297 million.

The Company has one important principle in driving business, which is “Quality Work, Quality Life” as the Company believes that high quality performance must come from high quality personnel. Therefore, the Company puts its focus on personnel development and urges its employee to continually develop personal specializations.

In addition, the Company also provides fair and sufficient welfare to all levels of employees to promote and to create employee engagement or good relationship between employees and the Company which is considered as an important factor in strengthening the Company to be able to drive the business forward efficiently.

The goal of 2010 of the Company is to become the leader in Knowledge Communication business and expand the service in the field to other business segment. The goal comes from the Company’s intention to be an important part in developing Thai society. The Company believes that, besides differentiating the Company from other companies, developing Knowledge Communication business will provide value to the society as well.

In addition, the Company also has a goal to expand the conference organizing, international trade exposition, and event marketing organizing businesses, all of which are the Company’s core businesses, to cover wider areas. Within 2010, the Company will put emphasize on expanding the service area to various industry groups both internationally and domestically by utilizing the Company’s strong network.

13 12

Part I Executive Summary

Part II Security Issuing Company Company Name

:

Pico (Thailand) Public Company Limited

Principal Business

:

Management organizing of Meeting, Incentive, Convention, and Exhibition (MICE), Event Marketing and Brand Image Building, as well as Knowledge Communication

Address

:

10 Soi Lasalle 56, Sukhumvit Road, Kwang Bangna, Khet Bangna, Bangkok 10260

Corporate Registration

:

Bor Mor Jor. 0107546000296

Telephone

:

02 748 7007

Facsimile

:

02 745 8521 / 02 745 8522

Website

:

www.picothai.com

Part II Security Issuing Company

16 15

Risk Factors Risk factors that may affect the Company’s operations are as follows :

External Factor

The Ever Increasing in Market Competitiveness Due to recent emergence of several entrepreneurs in the market, The Company needs to always revise its strategy to make sure that it can stay competitive in this industry.

Not only the Company has extended its services to cover all functions of event marketing, it also created a different by becoming the market leader in Knowledge Communication. This has become the new strength of the Company that allows the Company to keep its customer-based while reaching out to new market.

Economic Downturn Situation According to recent economic forecasting, the economy crisis tends to be upward.

However, there are no any exact indicators saying that the economy is recovering.

Therefore; the Company has been keeping its eyes on in order to always be prepared to adjust company’s strategy accordingly. The most obvious impact from economic downturn is the lower investment from business partners.

Therefore, the Company has adjusted its operation to make the most benefits to out customers by providing total solution service from Generate to Organize. It also offers strategic consulting service through Strategic Partner solution to ensure that the services provide by the Company will match the needs of the customers and to make sure that all the costs are well spent.

Unpredictability of Customers There are many factors that can affect customer’s business decisions or marketing strategy, the Company cannot depend on proving services to only a specific group of customers. In order to face the unpredictability of the customers, the Company has adopted a strategy to expand its customer-base to various industries in both domestic and international. By doing so, the Company will become more flexible in doing its business.

Political Effect The political instability is another important factor that affects our industry due to the fact that our business relies so much on number of attendees at each event. For the Company, our target customers and partners are both domestic and international.

Therefore, the overall country’s image will reflect the decision of the attendees when they make a decision to participate in an event or work with the Company.

In order to soften the situation, the Company is working closely with Thailand Convention and Exhibition Bureau (TCEB) to improve the image of the country.

17 16

Risk Factors

Internal Factor

Human Resources Risks Our business relies on professional staffs that possess a great deal of skills and creativity to move forward and stay competitive in the market. Therefore, the Company gives high priority in recruiting high potential candidates to join the company. It also continues to give high importance in employee engagement by providing a good working environment and provide trainings to staffs for necessary skills. The Company also gives competitive benefits to our staffs to make sure that the Company can keep the risk in losing talents under control.

Information Technology Risks Technology plays an important role for the Company in providing its services from designing to organizing. Therefore, if the Company does not have necessary technology and professional staffs that are capable of using the technology, it may lose the trust from customers and business partners.

The Company gives high important in investment for technology that required for event marketing industry (i.e. designing software, hardware, printers etc. to keep the Company competitive in the market. To reduce the risks that may come with such high investment, the Company will only invest in the “must-have” technology and consider outsourcing for other specific needs from local and international vendors.

Risk Factors

18 17

Scope of Businesses Historical Development and Major Changes ƒ

Background Pico (Thailand) Public Company Limited was formed in 1981 as a joint venture between Thai investors led by Mr. Pised Chungyampin and Singapore investors by Pico Art International Pte Ltd., which is a world class leader in the design and construction of the trade show and exhibition business. The joint venture was named Pico Thai Exhibition Contractor Co. Ltd. Subsequently, Pico Art International Pte Ltd. became a listed company on the Stock Exchange of Hong Kong under Pico Far East Holding Limited and expanded business covering the entire value chain as well as invested in other businesses such as real estate and construction materials. Currently, Pico Group operates around the world 34 branches in 26 countries including Thailand.

ƒ

Significant Changes and Development Pico (Thailand) Co. Ltd. (Public) has continually developed its organizational structure in order to accommodate changes in the business environment and its strategic objectives. Major developments are as follows :

19 18

1992

:

Pico International Enterprise (Thailand) Co., Ltd. was formed on March 15, 1992 with changes in capital structure and shareholding to accommodate increased challenges. Capital was at Baht 15 million with Pico Far East Holding Limited through Pico Art International Pte Ltd. at 49% and Thai investors at 51%.

1995

:

PX System Company Limited and Multi Designs Company Limited were established.

1996

:

Artcom Graphic Company Limited (then renamed to NOX Bangkok Co., Ltd. in 2008) and Inkjet Images (Thailand) Company Limited were established.

2003

:

Name was changed to Pico (Thailand) Company Limited and registered as a public company and capital also increased to Baht 65 million on September 16, 2003.

2004

:

Became a listed company and traded as Pico (Thailand) Public Company Limited in the Market for Alternative Investment (MAI) on April 19, 2004.

2005

:

Registered capital increased from Baht 65 million to Baht 115 million on February 25, 2005.

Scope of Businesses

Overview of the Business of the Company, Subsidiaries and Associated Companies

Operation The Company’s business has continually expanded in the scope of products and services as a result of the experience and expertise gained. Products and services are designed to match customers’ needs and new business opportunities are continually explored. Currently, our principal business is the Meeting, Incentive, Convention and Exhibition (MICE) drawing on the inner strength of the company’s specialist personnel and latest technology while simultaneously leveraging on Pico’s worldwide network and resources. This has given us a distinct product advantage and gained customers’ acceptance.

Another business is Event Marketing where we have over 20 years of experience especially in the face to face or field marketing. By adopting a strategic partnership approach with clients, our product delivery is always distinct and different from competitors being tailored specifically to the customers’ needs. This business has become another principal income generator for us.

Knowledge Communication has become another income earner for us. This is a relative newcomer and came as a result of our intent on creating businesses that are also socially rewarding. It draws on our expertise in communication and event marketing skills which are further refined and molded into an effective communication tool. In addition to the social benefits we believe that this business has definite growth potential as reflected in the importance given to it by the various government sectors.

Additionally, we also conduct other businesses and services that complement our main products thus making us a full service provider. For instance, some of these services are event organizer and supply of construction equipment including decorative materials.

We stress an all inclusive or turnkey approach to our service starting from the design concept, planning, constructing, and arranging exhibition, media selection and event management.

Scope of Businesses

20 19

The overall approach in each of our business segment is to focus on the customers, their needs and communication objectives so that a plan can be set for the event. A communication process is then set up to effectively transmit this specific information to the target market with expected reaction whether in terms of sale or product comprehension.

As for the individual business direction, our objective is to expand the market share both the physical i.e. site works as well as the service i.e. event managing and organizing in the domestic and international arena. ƒ

Operation of Subsidiaries and Associated Companies To effectively and completely meet customer’s needs, we have invested in businesses which enhance our products and service delivery capability. Our subsidiaries and associated companies are staffed by experts in their individual fields with ready and distinct solutions to meet our client’s demanding needs.

Scope of businesses and services of the subsidiaries and associated companies: Subsidiary Companies

1.

PX System Co. Ltd., exhibition booths assembly for trade and merchandise shows as well as booth and other assets rental

2.

NOX Bangkok Co. Ltd., specialized event marketing management for clients with exclusive and/or specific target market audience

3.

Multi Designs Co. Ltd. for the design for merchandise show and interior design including print media design

Associated Companies 4.

Inkjet Images (Thailand) Co. Ltd. for the design and graphic work and printing

5.

Ibrix Co. Ltd. for the execution of trade exhibition and related businesses

6.

Design Lab MISC Co Ltd. for specialized architectural design for an exhibition, museum, electronic media and the latest innovative products/ideas

21 20

Scope of Businesses

The Company’s Structure, Subsidiaries and Associated Companies Pico (Thailand) Public Company Limited Subsidiaries PX System Company Limited Design and construction of booths in an exhibition hall Capital registration: 11 MB

Nox Bangkok Company Limited Event marketing for niche market customer Capital registration: 10 MB

Associated Companies 89.99% 22.22%

Inkjet Images (Thailand) Company Limited

40.00%

Ibrix Company Limited

20.00%

DesignLab MISC Company Limited

Graphic design and production of large format printing Capital registration: 6 MB

99.99%

Trade exhibition Capital registration: 5 MB

Multi Designs Company Limited Creative, design and supply of innovation in exhibition, marketing activities and permanent exhibit

Capital registration: 4 MB

59.99%

Specialized design company Capital registration: 2 MB

Revenue Structure for the Last 3 Years Revenue broken into business segments as disclosed in note 28 of the annual financial statement for the year ended October 31, 2009. The revenue structure for the last 3 years is as follows :

Trade Exhibition and Display Event Marketing Permanent Exhibition and Museum Graphic Design and Printing Organizer Others

Baht Million

2007 %

Baht Million

2008 %

Baht Million

2009 %

413 156 271 20 154

41 15 27 2 15

417 171 47 1 150 223

41 17 5 0 15 22

313 88 56 21 106

54 15 10 4 17

1,014

100

1,008

100

583

100

Scope of Businesses

22 21

Business Objectives Pico (Thailand) Public Company Limited has 4 business objectives: 1. Maximum returns to shareholders, we have continually adjusted our strategy to ensure a smooth and maximum yielding business operation. The key support here is the strength of our local partners and extensive overseas network.

2. Committed customer focus with uncompromised quality and continual service improvement. Our work must meet with or exceeds customer’s expectation. This involves our continuing skills improvement while maintaining our market leadership position.

3. Continued building of corporate stability and progressive development, we believe in the concept of “Quality work from Quality people� and actively promote personnel development and employee engagement attitude through good working environment, innovation encouragement and equitable compensation system. We believe that quality work can only come as a result of quality of life of our employees.

4. Corporate social responsibility, we intend to continue with the business that will yield benefits to society and community such as knowledge communication. We believe that knowledge is the critical factor in human resource development which will ultimately result in the development of the country. We therefore intend to increase our involvement in this business segment.

23 22

Scope of Businesses

Description of Services The company has 4 principal services as follows : 1.

2.

3.

4.

Meeting Incentive Convention and Exhibition (MICE) Event Marketing Knowledge Communication Others

Service Description 1. Meeting Incentive Convention and Exhibition (MICE) The MICE business is one of our principal business segments. In organizing a meeting, our operation begins with the meeting with customer to discuss the design of the meeting, the design of activities, and ground management all the way to the final step as the organizer of the event. In the trade exhibition or display business, our principal focus is on the creation of an effective communication tool leading to the design and construction of booths, lighting, sound and activities targeting the customer’s attention and understanding.

In this business segment, we have evolved from being a product design contractor and working with the event organizer on behalf of the customer to being an event or exhibition manager. This means that our service has become more integrated from the design, plan and implementation of a market communication project in accordance with the marketing objective of the customer.

As an integrated service provider, we have direct control on each stage of the exhibition process. International level of quality is, therefore, possible at each step of the service delivery.

2. Event Marketing This segment differs from the merchandise and trade exhibition business as it is the customer’s direct marketing communication to his target group aimed primarily at boosting sale. Work contents also differ depending on the individual business and the customer’s communication objective.

Additionally, the scope of business may expand to cover other activities aimed at enhancing the relationship between the customer and his consumers or simply to boost the customer’s corporate image e.g. a special festival in seminar format or an entertainment activity.

Description of Services

24 23

The category of events is mostly dependent on the target audience and can be grouped as follows: -

Business to Business (B to B) Event marketing between those who are business operators such as trade show/exhibition

-

Business to Consumer (B to C) Event marketing between business operators targeted at their consumers such as product launch, concerts/entertainment all of which is aimed at creating and bolstering our customer’s relationship with the consumers.

-

Government to Consumer (G to C) Event marketing featuring communication between the government sector and the public such as the public event on government’s achievements

-

Corporate Identity (CI) Event marketing designed to create and bolster corporate image of a business such as a new image launch.

Event Marketing is, therefore, a recognized marketing tool in the various business segments. It not only adds product value, but also reaches the target group directly.

We at Pico offers an integrated or turnkey service starting with getting involved in the marketing plan with customer, concept planning and design, constructing a finally putting the show on as the organizer. As an event service provider, we also serve the logistic and supportive needs of the customer such as transport and installation services.

3. Knowledge Communication The other major business segment is the knowledge communication. This business stems from our desire to produce work that is not only financially rewarding but also yields benefits to the community and society. This business draws on our extensive experience and knowledge in the various specialized areas which are then blended and communicated through the various channels to produce an effective learning experience thereby creating a new learning process.

We have provided these services to both the private and public sectors whose objective is to transmit or spreading knowledge to the public through temporary, semi permanent and permanent exhibition, learning and visitor centers knowledge transfer centers and museums.

Our service is premised on the most effective means of communicating the knowledge to the general public. In addition to the venue design, we also plan and devise an appropriate learning program of the knowledge to be communicated to the target audience or an individual earner. To achieve this end, we need to understand the behavior of the learner, the appropriateness and depth of the material, the ease of the experience absorption and other relevant environmental conditions. Due consideration of these factors will result in our thorough understanding of the subject by the learner who can make further gain by combining this new learning with his existing knowledge/ experience. Personal as well societal benefits will have been achieved.

Our operation begins with the initial project outline, research, design of the learning program, exhibition design, production and ending up with the museum management.

25 24

Description of Services

4. Others Beside the services mentioned, we have other services to support and facilitate the customer’s business.

-

Rental of large air-conditioned tents from 1,000 sq. m. up to more than 20,000 sq. m.

This serves to provide additional temporary space to exhibition organizers or large projects requiring significant covered space.

-

Graphic design for signage and banner projects used in advertising and/or public relation work

-

Furnishings to complement the counter display as product point of purchase. These are eye catching units placed in the exhibition booth or department store to increase sale in accordance with the target’s marketing plan.

-

Interior design of offices and corporate identity

Market and Competition

Overview of the Market and Marketing Policy Despite the continued steady growth in the event marketing, competition is not intense relative to the other business segments since the industry is characterized by small producers with limited service capability compared to Pico. However, the current economic slowdown and political instability may impact our operation.

As a market leader, we are determined to continually develop our organization to accommodate the changing environment to meet the expectation of our customers.

We are committed to the following improvements and development:

1. Develop a close relationship with customer. Our focus is to get close to the customer through the dispensing of advice on event marketing management. Additionally, we also focus on the expansion of our customer base throughout the various industrial segments both inside and outside of Thailand.

2. Using the latest and state of the art technology. We continually strive to improve on our design, conceptual ideas and human resources in order to accommodate the changing technological environment and to maintain our recognized leadership position in the technology area.

3. Improvement in quality of services rendered. We focus on the delivery of an integrated service package where the customer can conveniently avail of our one stop service and save time. Apart from the comprehensive service package strict quality control; at each step of service delivery is always assured.

4. Service quality improvement. Our strategic objective is uncompromised service and customer’s complete satisfaction. We believe that service quality is a reflection of personnel quality. We, therefore, give primary consideration to personnel development and improvement so as to ensure product/service quality and customer’s satisfaction.

For 2010, our policy direction is to grow the knowledge communication business as it is a relatively new segment in the market with a strong growth potential. We believe that we will be able to become one of the leaders in this business both in the domestic and international market.

Description of Services

26 25

ƒ

Customer Profile Our customers are those with a track record of consistent growth with an international aspiration. These are state and/or state supported companies and private operation which need to increase market awareness/penetration and turnover. They are divided into 2 categories as follows:

1. State enterprise and other government agencies, the public sector regularly conduct events to publicize the workings of its units in order to increase public awareness and understanding. This includes also the promotional activities for government supported industries aimed at sustaining the economic growth. The agencies that are responsible for such activities are: the Ministry of Culture, the Ministry of Information and Communication Technology, Ministry of Science and Technology, Ministry of Education and the Department of Export Promotion.

2. The private sector is as follows: -

The automobile sector

:

This group emphasizes event marketing as it provides a venue for the consumer to make the decision immediately.

-

The telecommunication sector

:

This is a business characterized by high growth and intense competition and pays a significant interest in the event marketing / communication.

-

The energy sector

:

This group has a record of consistent growth and recognizes the importance of corporate social responsibility. It regularly conducts activities aimed at increasing the public understanding of its organizations.

-

The financial institution sector

:

The retail banking business is characterized by intense competition with constantly changing marketing strategy to meet customer’s demand. Event marketing is therefore the preferred choice of communication for this industry.

-

Other sectors

:

With the continued economic growth the consumer product, business also needs to communicate more to meet the challenges of greater competition e.g. the apparel, food and jewelry industry.

27 26

Description of Services

From above customer characteristic, the revenues by customer group is as follows :

Income Portion by Customer Group

Baht million

2007 %

Baht million

2008 %

Baht million

2009 %

397

40

144

14

136

23

254 65 0 28 12 258

25 6 0 3 1 25

278 262 15 9 0 300

27 26 2 1 0 30

178 5 31 30 15 188

30 1 5 5 3 33

1,014

100

1,008

100

583

100

State enterprises/government Private Sectors - Automotive - Telecommunication - Energy - Financial Institute - Food and beverage - Others

Our Project Management Process

1. Direct customer contact Our marketing team constantly tracks customer’s business and needs. Specific product/service package is then tailored and presented to customer to match his objectives and budget. If selected, the marketing team will pass on the package to the production department which will carry on with the customer.

2. Customer relationship management We are committed to an international standard of excellence. Customer’s trust and complete satisfaction are foremost on our agenda. This assures us of repeat business.

3. Business alliances Business alliances with the trade organizers and other players in the event marketing industry is a channel that provides marketing channel to customer.

4. Customer’s recommendation With over 20 years experience with international standard operation, we often receive referral business from our satisfied clients.

5. Pico Far East and the extensive worldwide network With our Pico Far East affiliation and its extensive network in 26 countries we have direct access to various institutional names when they come to Thailand.

Description of Services

28 27

Product Sourcing The key steps of our products sourcing process are as follows:

Marketing

-

Study customer’s background/information Customer contact to determine their marketing and objective and requirements Conceptual design and operational plan

Design

-

Research on specific requirements of customer Realization of conceptual design, structure or exhibition with support from subsidiaries such as Multi Designs Co., Ltd. or Design Lab MISC Co., Ltd. Budget and breakdown presented to clients

Construction

-

We will either do the construction or sub-contract out to outside specialists with tracking on quality. We will perform the supervision and final survey before handing over to clients.

Project Management

-

Once production is completed, we will commence to build a stand by team to manage all aspects of the project to ensure of success e.g. publicity, cleaning and security. We will be in charge of these services until the end of the project.

Work in Progress as of October 31, 2009 Undelivered Works Meeting Incentive Convention and Exhibition (MICE) Knowledge Communication Others

Baht Million 77 67 12 156

29 28

Description of Services

Research and Development The Company’s research and development focuses on the enhancement of our capability to convey the professionalism in each line of business and utilize the knowledge to the up most extent by sending of personnel for training in and outside of the country as well as always on the lookout for overseas talents to join our team and research together with finding the ways to adapt new products and procedures to be used in individual projects.

Research and Development

30 29

Assets Employed in the Conduct of Business Property, Plant and Equipment as of October 31, 2009

Details of the company’s land and building Property, plant and equipment Title deeds no. 216194-7 Soi Sukhumvit 105 (Lasalle 56) Sukhumvit Road, Bangna District, Bangna Sub-district Bangkok 10260 Office Building 10 Soi Sukhumvit 105 (Lasalle 56) Sukhumvit Road, Bangna District, Bangna Sub-district Bangkok 10260 Land Improvement

Areas

Types of rights

Baht million

Commitment

2 rai 200 square wah

Outright Owner

43.7

None

4,097 sqm.

Outright Owner

34.2

None

Outright Owner

-

Details of other assets Assets Vehicles Vehicles Office equipment Computer Equipment & machinery Office decoration Operating accessories

Types of ownership Outright owner On hire purchase Outright owner Outright owner Outright owner Outright owner Outright owner

Baht million 0.1 3.9 3.5 2.5 0.1 3.9 5.7

Commitment None 3.9 Baht million None None None None None

Note With leasing companies

Intangible Assets The Company pays an annual royalty equals to 2.53 % of total revenue to Pico Art International Pte., Ltd. (“Pico Art”). This is in connection with the “Offshore Services Agreement and “Intellectual Property License Agreement” dated July 10, 1992 and its amended November 3, 2003. Under these agreements, the Company is entitled to use the logo, trade name, technology and new innovation of Pico Art International Pte., Ltd. in its conduct of business. These privileges will continue, irrespective of Pico’s Art’s shareholding in the Company, provided that the royalty payment is paid until the Company terminates the agreements. Additionally, Pico Art agrees not to compete for business in Thailand directly or indirectly. The agreements do not preclude the Company to serve foreign clients in a foreign country provided that it is a direct request by the clients.

31 30

Assets Employed in the Conduct of Business

Investment Policy The Company has a policy to invest in a business operation that will complement and enhance its ability to deliver an integrated product offering e.g. a design company.

The Company invested in PX System Co., Ltd. and Multi Designs Co., Ltd. in 1995, Artcom Graphic Co., Ltd. (then renamed to NOX Bangkok Co., Ltd. on October 27, 2008) and Inkjet Images (Thailand) Co., Ltd. in 1996, and Ibrix Co., Ltd., and DesignLab MISC Co., Ltd. in 2006. These investments permit the Company to offer comprehensive and integrated products/services to clients.

In the management of these companies, the Company is represented on the executive board and participates in the setting of policy and the implementation thereof. The subsidiaries and joint ventures are encouraged to seek outside businesses to lessen dependence on the Company with no greater than 30% of turnover being “captive� business. This will encourage independent growth and reduce the overall operating risks.

Assets Employed in the Conduct of Business

32 31

Future Plan The Company will focus on the flexibility to change and adapt our organization in line with the changes in the business environment. Due consideration will be given to the political, economic risks and the changes in our customer’s profile and the community in general. The Company has established the future direction and policy as follows : -

Expansion into the international market capitalizing on our established expertise.

-

Integrate our operation to cover the entire process from upstream to downstream.

This will have a significant impact on our operation within 5 years time horizon.

-

Expand the scope of business especially in the educational projects that will yield increased benefits and returns to the community.

33 32

Future Plan

Legal Dispute In 2009, the Company has one legal dispute, which is still in the Labor Court, and its detail is as follows: Court case

:

Central Labor Court

Court Case No.

:

Black No. 2312/2551

Starting case date

:

June 9, 2008

Prosecutor

:

Miss Nitida Thamasoontra

Defendant

:

Pico (Thailand) Public Company Limited

Factual basis

:

Initial approximately Baht 50 million and then decreased to approximately Baht 18 million

Progress of court case :

Under investigation of defendant

The opinion of management on this case: Should the defendant win the case, there is no any liability for the Company. However, the managements believed that in case the Company loses the case, the prosecutor shall receive compensation in the amount of 10 month and notice of 1 month salaries of the last month salary amount according to the labor law.

Legal Dispute

34 33

Capital Structure Stock of the Company The Company has a registered capital of Baht 115,000,000 with Baht 114,999,980 fully paid up, divided into 330,000 preferred shares with the par value of Baht 1 and 114,669,980 common shares with the par value of Baht 1. ƒ

Rights of Common and Preferred Shares The preferred shares have the right to receive dividends equal to ordinary shares. The dividend will be calculated from profit earned after the issuance of preferred shares.

However, any profit on the appraisal of land, buildings and other assets which existed before the issuance of the preferred shares, will be allocated solely to the ordinary shares.

The preferred shareholders have the right to vote in the shareholder meeting, a ten thousand preferred shares are equivalent to one voting right of a ordinary share. The preferred shares have the right to receive the proportion of their return on investments upon liquidation equal to ordinary shares.

Common Shareholders Name list and portion of top ten shareholders shown as book registered as of October 31, 2009.

Name of Shareholders

Number of Shares

% of Shareholding

1

Pico Art International Pte Ltd. (1)

46,000,100

40.12

2 3 4 5 6

Mr. Pised Chungyampin (2) Citibank International Plc. (Luxembourg Branch) Thai NVDR Co., Ltd. Mr. Supawit Wattanaphant Mrs. Jirphan Sathienpakiranakorn

29,370,038 3,871,800 3,641,346 2,177,400 2,000,000

25.47 3.83 3.38 1.90 1.74

1,460,485 1,276,138 1,121,400 1,074,455

1.34 1.11 0.98 0.94

92,660,695

80.81

Item

7 8 9 10

Mr. Silchai Kiatpapan (2) Mr. Suwiphant Ditsayamolthon Credit Suisse Singapore Branch Mrs. Asara Tulyathan

Notes: (1) Chairman of the Company is a director of Pico Art International Pte Ltd. (2) An executive director of the Company

Dividend Policy Provided that there are no other needs such as major business expansion, the Company and subsidiaries have the policy to pay out the dividend at the rate of approximately 40% of net profit after taxes.

35 34

Capital Structure

Senior Executive Vice President Event Marketing Special Project Mr. Chokchai Vatcharanirunkul Executive Vice President Event Marketing I Miss Supaporn Sawangjitt

Nomination Committee

The Company structure as of October 31, 2009 is as follows:

Management

Management

Vice President Strategic Marketing

Mr. Silchai Kiatpapan

Chief Executive Officer

Mr. Pised Chungyampin

Executive Chairman

Executive Committee

Board of Directors

Human Resources Manager

Remuneration Committee

Audit Committee

Management

Chief Financial Officer Mr. Chaijit Tehasuwanarat

36 35

Organizational Structure of Directors The organizational structure of directors of the company consists of 5 boards.

1. The Board of Directors As of October 31, 2009, the Company has 8 board of directors members consisting of 5 non-management directors of which 3 are independent directors as follows : 1 Mr. Chia Song Heng Chairman 2 Mr. Pised Chungyampin Vice Chairman 3 Mr. Silchai Kiatpapan Director 4 Mr. Chung Chee Keong Director 5 Mr. Viriya Pholpoke Director and Executive Advisor 6 Mr. Chaiyod Bunyagidj Independent Director and Chairman of the Audit Committee 7 Mr. Sern Vithespongse Independent Director and Audit Committee Member 8 Mrs. Sasitorn Phongsathorn Independent Director and Audit Committee Member With Mr. Chaijit Tehasuwanarat as the secretary to the Board of directors Terms of Office Members of the Board serve a period of 3 years.

Directors are elected by the shareholders' meeting in the Annual General Meeting of Shareholders. At the Annual General Meeting of Shareholders, one-third of directors shall retire by rotation. If the number of directors is not a multiple of three, the number of directors closest to one-third shall retire with the longest serving directors retiring first. A director who vacates office under this Section may be re-elected.

If directorship vacancy exist other from the rotational retirement, the Board of Directors may select a qualified person to become a replacement and to attend the following scheduled board meeting.

Directors Authorized to Sign and Bind the Company Directors authorized to sign and bind the Company are Mr. Pised Chungyampin together with Mr. Chia Song Heng or Mr. Silchai Kiatpapan or Mr. Chung Chee Keong, constituting 2 signatures with the Company’s seal affixed.

37 36

Management

Scope of Authority of the Board of Directors 1

The Board of Director’s functions The Board of Directors shall act to ensure maximum benefits from the conduct of the Company’s business by using its knowledge and experience to the fullest capability. It shall conduct its role according to the Company’s memorandum of association and bylaws with due care and discretion to protect the rights of and be responsible to the shareholders.

2

Establishing the Company’s objectives, business direction and policy The Board is charged with the setting of appropriate policy and business direction of the Company except the policy or business direction which requires shareholders’ approval.

3

Appointment and supervision of the Executive Committee The Board is empowered to appoint a committee consisting of directors as it deems appropriate to act as an Executive Committee to manage on its behalf. In this respect the Board of Directors at its meeting 1/2003 held on August 29, 2003 resolved to appoint an Executive Committee and clearly established its scope, power and duties.

The Board of Directors will be responsible for the supervision to ensure that the Executive Committee effectively carries out the approved policies.

4

Appointments and delegation of authority to other persons The Board of Directors may appoint any other person to conduct the Company’s business under its supervision or it may delegate authority to said person as it deems appropriate. The time period of this authority delegation shall be set as the Board deems appropriate and the Board may rescind, remove, alter or modify such delegation. Such appointment or delegation shall fall under the following rules:

-

Any appointment and authority delegation shall not be bestowed on person(s) with a vested interest in or is in conflict with the Company or its subsidiaries.

-

Person(s) so appointed and delegated shall not be able to approve transactions that involve themselves or persons that may be in conflict with, possessing vested interest in or having any other potential conflict of interest against the Company or its subsidiaries.

-

Appointment and delegation must be accompanied by a clear establishment of scope of authority, duty, and responsibility and must be in accordance with the resolution of the Board of Directors meeting attended by independent directors or members of the audit committee. In the case that such delegation of power is objected to by a member of the independent director or an audit committee member such objection shall be clearly recorded in the minutes of the meeting.

Management

38 37

2. The Executive Committee As of October 31, 2009, the Company has 6 executive committee members as follows: 1 2 3 4 5 6

Mr. Pised Chungyampin Mr. Chia Song Heng Mr. Silchai Kiatpapan Mr. Chokchai Vatcharanirunkul Ms. Supaporn Sawangjitt Mr. Chaijit Tehasuwanarat

Chairman Vice Chairman Executive Committee Member Executive Committee Member Executive Committee Member Executive Committee Member

Scope of Duty and Authority of the Executive Committee 1

To propose for the Approval by the Board of Directors the followings :

-

Business objectives and direction Business strategy and policy Annual business plan and budget Organizational structure and management including details on selection, training, recruitment and termination of employees

2

Supervision and overseeing that the Company’s business operation follows the Board’s approved business strategy, policy and plan.

3

Screening of business contractual obligations of the Company, acquisition of assets or rights to be used to the benefit of the Company. This includes the setting up of negotiating processes in the closing of the said contracts.

4

Screening of fiduciary contracts, lending, borrowing and undertaking of guarantee by the Company.

5

Acting on contract amendment and termination in accordance with the Executive Committee’s discretion.

6

To consider the profit and loss account of the Company and the proposal of an interim or annual dividend payment to the Board of Directors for approval.

7

To engage in any other action in order to support the above or as may be delegated by the Board of Directors from time to time.

The foregoing duties and powers of the Executive Committee shall be under the law and the Company’s bylaws. The Executive Committee shall not have the authority to approve transaction that its members or others may be in conflict with or possess a vested interest in or having any conflict of interest against the Company or its subsidiaries. Should such a case arise, the Executive Committee shall refer the case for consideration by the Board of Directors.

39 38

Management

3. The Audit Committee As of October 31, 2009, the Company has 3 audit committee members who are independent directors as follows: 1 Mr. Chaiyod Bunyagidj Chairman of Audit Committee 2 Mr. Sern Vithespongse Audit Committee member 3 Mrs. Sasitorn Phongsathorn Audit Committee member Mr. Chaijit Tehasuwanarat servicing as secretary to the committee Qualifications of the Audit Committee and Independent Directors 1

Holding less than 1% of the outstanding shares with voting rights in the company, subsidiaries, associated companies or persons deemed to represent conflict of interest (including such persons described in code 258 of the Securities and Exchange Act B.E. 2535).

2

Having no part in management including not being a member of the employees, staff, salaried advisor or authorized management of the company, subsidiaries, associated companies or a person deemed to represent a conflict of interest during the past 2 year before appointed.

3

Having no direct or indirect business relationship, benefits, stake in the company. This covers the financial and administration of the company, subsidiaries, associated companies or persons where conflicts could compromise independence.

4

Not being closely related to management, major shareholders of the company, subsidiaries, associated companies or persons who may be in conflict. Not also having been appointed as attorneys representing the interest of the directors or the major shareholders.

5

Not having been appointed as a Company director to represent major shareholders who may relate to other majors shareholders.

6

Having no other condition that would impair the rendering of independent opinion

7

Independent Director processing the quality as outline in 1-6 above may be assigned by the Board of directors to carry on the operation of the Company, subsidiaries and associated Company or other juristic entities that may be in a conflict of interest situation. The decision may be made collectively.

Management

40 39

Scope of Authority of the Audit Committee The Audit Committee has the duties as delegated by the Company’s board of directors, as follows: 1

To review the Company’s financial reporting process to ensure that it is accurate and adequate by coordinating with external auditors and executives responsible for financial reports and quarterly and annual;

2

To review the Company’s internal control system and internal audit system to ensure that they are suitable and efficient;

3

To ensure that the Company has duly complied with the laws on Securities and Exchange Act, the Stock Exchange of Thailand regulations, and the laws relating to the Company’s business.

4

To consider, select and nominate an independent person to be the Company’s auditor, and to purpose such person’s remuneration, as well as to request the appointment of the Annual General Meeting of Shareholders.

5

To review the connected transactions, or the transaction that may lead to conflicts of interests that are accurate and complete

6

To prepare and disclose the Company’s annual report, and audit committee’s report which must be signed by the Chairman of the Audit Committee and consist of at least the following information;

(a) an opinion on the accuracy, completeness and creditability of the Company’s financial report, (b) an opinion on the adequacy of the Company’s internal control system, (c) an opinion on the compliance with the law on securities and exchange act, the Stock Exchange of Thailand regulations, or the laws relating to the Company’s business, (d) an opinion on the suitability of an auditor, (e) an opinion on the transactions that may lead to conflicts of interests, (f) the number of the Audit Committee meetings, and the attendance of such meetings by each committee member, (g) an opinion or overview comment received by the Audit Committee from its performance of duties in accordance with the charter, and (h) other transactions which, according to the audit committee’s opinion, should be known to the shareholders and general investors, subject to the scope of duties and responsibilities assigned by the Company’s Board of directors; 7

41 40

To perform any other as assigned by the Board of Directors with the approval of the Audit Committee.

Management

4. The Nomination Committee The Nomination Committee was appointed by the Board of Directors’ meeting No. 6/2007 on December 14, 2007 as follows: 1 2 3 4 5 6 7

Mr. Chia Song Heng Mr. Pised Chungyampin Mr. Silchai Kiatpapan Mr. Viriya Pholpoke Mr. Chaiyod Bunyagidj Mr. Sern Vithespongse Mrs. Sasitorn Phongsathorn

Chairman Director Director Director Director Director Director

5. The Remuneration Committee The Remuneration Committee was appointed by the Board of Directors’ meeting No. 6/2007 on December 14, 2007 as follows: 1 2 3 4 5

Mr. Chia Song Heng Mr. Chaiyod Bunyagidj Mr. Sern Vithespongse Mrs. Sasitorn Phongsathorn Mr. Viriya Pholpoke

Chairman Director Director Director Director

Scope of Duty and Authority of the Nomination and Remuneration Committees 1

To screen and select the appropriate person (s) as member (s) of the Board of Directors and to propose the selected individual to the Board of Directors who then submit to the shareholders’ meeting for approval.

2

To determine the remuneration package and other benefits, duty and responsibility of Executive Chairman and Executive Chief Officer, along with procedure and performance evaluation, will be for consideration of yearly compensation.

Selection of Directors and Management Executives In the selection process for directors the chairman will appoints the Nomination Committee to assist in the consideration of persons with appropriate qualifications which do not run contrary to the laws governing public companies. Criteria used will be vision, basic qualifications and extensive experience which will be beneficial to the Company. Such person must be of highest moral value and unquestioned ethics in accordance with code 68 of the Public Company Act 2535 and the relevant announcements of the SEC and the SET. The selected person is then submitted to the Board for election during its meeting.

In the case that a directorship becomes vacant for reasons other than the rotational retirement the remaining directors at its subsequent meeting may elect a suitably qualified person to fulfill the vacated position. No shareholder’s meeting is needed for this election. The replacement director may only serve out the remaining tenure of the vacated director.

Management

42 41

Directors’ Compensation 1. Monetary Compensation Directors The 2009 Annual General Meeting of Shareholders held on February 16, 2009 approved directors’ remuneration 2009 in the amount not exceeding Baht 5,000,000 with the disbursement to be decided by the Board of directors. This is effective from the date of the Annual General Meeting of Shareholders until otherwise changed by another shareholders’ resolution.

The criteria for director’s fee as follows : 1. Monthly compensation Baht 5,000 per person 2. Meeting attendance at Baht 15,000 per meeting attended 3. Baht 200,000 annual compensation per person to 3 audit committee members payable quarterly 4. The Board of Directors has approved a bonus payment to the 3 independent directors and one advisor totaling 4 persons with payment to be considered from individual responsibility of each director.

Monetary compensation to directors in 2009 as a resolution of the Board of Directors as follows : Name 1. Mr. Chia Song Heng 2. Mr. Pised Chungyampin 3. Mr. Silchai Kiatpapan 4. Mr. Chung Chee Keong

Monthly Fee (person/year)

Attending Fee

Audit Committee

Bonus

Total (Baht/Year)

60,000

75,000

-

-

135,000

60,000

75,000

-

-

135,000

60,000

75,000

-

-

135,000

60,000

75,000

-

135,000

5. Mr. Viriya Pholpoke

60,000

75,000

-

-

135,000

6. Mr. Chaiyod Bunyagidj

60,000

75,000

200,000

-

335,000

7. Mr. Sern Vithespongse 8. Mrs. Sasitorn Phongsathorn

60,000 60,000

75,000 75,000

200,000 200,000

-

335,000 335,000

480,000

600,000

600,000

-

1,680,000

Management In 2008 and 2009 the Company paid monetary compensation which is salary and bonus to management and an advisor in the amount of Baht 25.21 million and Baht 17.90 million respectively.

2. Other compensation - None –

43 42

Management

Good Corporate Governance The Company’s policy is for its members of the Board to comply with the regulations of listed companies with respect to the duty and responsibility of directors. Subsequent to the Company’s transformation to a public company, the Board of Directors and the Audit Committee together established supervisory guidelines in overseeing the Company’s operation and to clearly define the scope of authority of directors and management. This covers compliance to the law, memorandum of the association, bylaws and the resolutions of the shareholders with honesty, integrity and utmost care to ensure maximum benefits to the Company. The directors are also charged with establishing the Company’s policy and business direction and to ensure that the set policy is followed by management.

Pursuant to the guidelines established by the SET for listed companies in 2006 on operation oversight 5 principal areas are established : I.

Rights of Shareholders

Shareholders are the rightful owners of the Company whose rights and privileges are recognized and respected. These are: shares buy/sell, shares transfer, profit sharing, rights to attend meetings, participate in agenda deliberation and voting.

The Board of Directors shall arrange a shareholders’ meeting with a 7 day advance notice to all shareholders. Shareholders will be informed in writing of all agenda together with the directors; opinion and recommendation for each of the agenda presented. During the meeting the shareholders will have the rights to freely question and express their opinion during the deliberation of each issue. Minutes of the meeting will be recorded accurately and in full covering questions and answers for shareholders’ later perusal.

II. Equal Treatment to All Shareholders Each shareholder or group of shareholders is treated equally whether they are management or non management, majority or minority shareholders or foreign shareholders : -

Shareholders unable to attend meeting may appoint proxy holders to attend and vote on their behalf.

To ensure transparency and accountability Shareholders who are executive committee members shall not add unnecessary agenda to the meeting especially significant issues where shareholders need time to study the motion prior to making a decision.

III. Stakeholders All stakeholders are equally treated to foster a harmonious relationship leading to the growth and prosperity of the Company in the long run.

Management

44 43

The followings are undertaken : Employees:

The Company is fully cognizant that employees are its most important asset and the key to its growth. Training programs are established and on going to develop the best talents in the business. Competitive compensation package and benefits such as provident fund, life and health insurance are periodically reviewed to ensure that we remain competitive in the market. Feedbacks are encouraged so that management can learn of grievances and work toward a mutually acceptable resolution.

Trading partners:

Honor the market practice and contractual obligations in dealing with our trading partners

Customers:

Maximum benefits to the customers through the best and highest service quality, product standard, responsive to needs and respect of customer’s privileged information.

Competitors:

We believe that competition induces creative development and we abide by the rules of a good competition. We will not resort to predatory practices on our competitors.

Creditors:

We believe that contractual obligations must be honored to foster a mutually beneficial relationship in the longer term.

Community:

We are aware of our duty and responsibility to the community and strive to ensure that the rights of all stakeholders are protected through strict compliance to the law and regulations.

IV. Disclosure and Transparency We recognize the significance of disclosures, financial or otherwise to the public.

These disclosures are made through the channels prescribed by the laws and the SET in its annual information disclosure form and annual report and also other channels such as our website and the regular meeting with securities analysts. We are confident that shareholders can have access to the necessary information from these channels.

Moreover, shareholders and the general public can readily reach our investor relations officer for additional information.

Mr. Chaijit Tehasuwanarat, Chief Financial Officer, serves as the investor relations officer and may be reached at 02-748-7007 or email address chaijit@picothai.com

45 44

Management

V. Responsibility of Directors

Structure of the Board of Directors

-

The Company’s BOD consists of 9 directors with 3 being independent directors. The ratio of independent directors is 1/3 which is in compliance with the standard established by the SET. Members of the Board serve for a period of 3 years. The longest serving director will take turn in retiring in the proportion of 1/3 of total.

-

3 directors are appointed as executive committee members tasked with the implementation of the Company’s direction, business plan and established annual budget. The division of duty and responsibility of directors and executive committee members is clearly divided. The BOD is tasked with the oversight of the executive committee members in its implementation of the established policy. The chairman of the BOD and he chairman of the executive committee are different persons so as to provide a check and balance.

Furthermore, an audit committee is appointed comprising of 3 independent directors.

It is charged with the oversight of the Company’s operation and to ensure that the planning and business making decisions are appropriately taken and that the decision is not dominated by the executive committee or a single group of persons.

-

Checks and balances of non management directors By design the committees and boards are appointed so that no person or group of persons can dominate the decision making process to ensure of operational efficiency an established check and balance mechanism.

1 Director who are member of executive committee 2 Director who are not member of executive committee 3 Independent directors

3 persons 5 persons 3 persons

-

The audit committee members consist exclusively of independent directors to assist in the oversight of operation. The audit committee holds quarterly meeting and reports to the Board of Directors.

-

The Chief Financial Officer is appointed as the secretary to the board of directors, the audit committee with the duty to advise on legal aspects and other pertinent regulations that the directors need to be cognizant of. He also coordinates that the resolution made the Board of directors meeting be implemented.

Management

46 45

Board of Directors Meeting The Board supports regular attendance and encourages the participation of the members at meetings which are scheduled quarterly at the minimum. Meetings are held to inform of events with members encouraged in the business deliberations and participate in the decision making processes. Directors are informed in advance of the meeting date and venue with agenda and pertinent material supplied. During each meeting directors may introduce additional agenda for discussion. Open and meaningful discussions are encouraged with the secretary to the board responsible for the recording of the minutes. 5 meetings were held in 2009 as per the following details.

Name 1.

2.

3.

4.

5.

6.

7.

8.

Mr. Chia Song Heng Mr. Pised Chungyampin Mr. Silchai Kiatpapan Mr. Chung Chee Keong Mr. Viriya Pholpoke Mr. Chaiyod Bunyagidj Mr. Sern Vithespongse Mrs. Sasitorn Phongsathorn

Attendances 5 5 45 5 5 5 5 5

The Audit Committee 8 Audit Committee meetings were held in 2009 Name 1. Mr. Chaiyod Bunyagidj 2. Mr. Sern Vithespongse 3. Mrs. Sasitorn Phongsathorn

Attendances 8 8 8

Directors and Management’s Compensation Directors’ compensation: Compensation is based upon responsibility, duty, role which is clearly defined. The compensation is in line with industry’s norm.

Executive directors’ compensation: The compensation of the executive committee members is in accordance with the corporate performance and the individual performance of each member of management. The review process will be in line with peer companies in the same industry or similar sized companies. Corporate and individual performance will also be used in the review to be conducted by the chairman of the BOD together with the other directors with no vested interest.

47 46

Management

Insider Information Supervision A policy is established so that inside information is not to be used for personal gain.

This covers spouses and minor children of employees. The details are as follows :

1. All members of management in every department must be informed of their responsibility to report their stockholding and the penalties for failure to comply in accordance with Securities and Exchange Act B.E. 2535 and the regulations of the SET. 2. The Company’s policy is to allow senior management to disclose only minimal internal information to staff so as to permit the conduct of operation. Additionally members of management are prohibited to use insider information in the trading of the Company’s stock.

Internal Control The Company has an established an adequate control process on operation. This process is constantly updated and developed to accommodate the changing conditions. Management regularly audits to ensure that rules and regulations are strictly adhered to. Regular appraisal of the process is made to ensure that changes in organization are recognized. Outside internal auditors are commissioned to regularly review operation with report submitted directly to the chairman of the audit committee.

Personnel 1. Total staff of the Company and subsidiaries as of October 31, 2009 Permanent Employees

Daily Employees

100 41

2 51

141

53

Pico (Thailand) Public Company Limited Subsidiaries

Sectional breakdown of 100 employees Person Management Strategic Marketing Human Resources Finance and Accounting Marketing (Event Marketing)

11 6 13 12 58

2. Employee Compensation -

In 2008 and 2009 total monetary compensation which is salary and bonus to employees of the Company and subsidiaries totaling Baht 91.30 million and Baht 70.83 million respectively.

Management

48 47

-

Other Compensation Provident fund contribution 2009 Employees of the Company and subsidiaries contribute either 3% or 5% of monthly salary to the provident fund plan which is matched by equal contribution from the companies. Employees are entitled to the benefits based upon their length of service with 2, 3 and 5 years of service drawing 30%, 50% and 100% from the fund on leaving, respectively.

Unit: Baht million Provident fund contribution

2008

2009

2.44

2.77

3. Changes in number of personnel for the past 3 years.

In 2007 9 resigned with 24 new hired In 2008 14 resigned with 15 new hired In 2009 17 resigned with 6 new hired 4. Significant legal disputes during the past 3 years There is one legal dispute in 2009. Such case is still in the Labor Court. Please see details under “Legal Dispute�.

5. Personnel development policy To ensure continued corporate growth human resource development is an integral part of our policy. We are committed to develop our human resources and improve our human resource administration so that work quality goes hand in hand with quality of life. Staff members are encouraged to build on their strengths in accordance with our business approach and to be ready to meet the competition and respond to changes.

Our human resource administration goes hand in hand with job satisfaction along the following guidelines: Recruitment and Selection Process We have a guideline for the recruitment of high caliber staff members. A selection committee utilizes standardized fests based on capability in recruiting required personnel for the corporate assignment. Consideration is also given to the assessment of manpower requirement commensurate with the responsibility and business operation.

49 48

Management

Staff Training Our most important resource is our employees. We are committed to the development of each and every staff member to develop to his fullest potential Training courses is provided both in and outside of the Company. The training also extends to overseas training and observation visits.

Additionally, we foster a learning culture within the working environment by providing a lounge with a reading corner staffed with educational materials, internet and UBC. We truly believe that a good, clean and peaceful working environment is an undeniable prerequisite for good quality work. We, therefore, pay significant attention to the maintenance of premises as if our employees’ second home.

Employee Relations We have established an ongoing employee relations program to ensure that employees are well bonded. Staff members are encouraged to participate in the various aspects of corporate activities such as the New Year party. Additionally, core activities with social contribution are also encouraged such as donation drive for needy students, visits to orphanages and similar foundations.

Welfare Benefits We have an equitable compensation system in place. A provident fund, health and life insurance program are in place. Other benefits such as car and telephone allowance, per diem and staff uniform are continually reviewed to keep pace with the changes in economic conditions. Additionally, staff has an access channel to air grievances to management for due consideration and further mutually beneficial resolution.

Security and Occupational Hazards A safety committee is establishes to ensure of work place safety. Regular inspections on safety and security of premises are conducted. Adequate safety equipment is provided and staff is well advised on fire safety and the appropriate use of fire fighting equipment.

The company held a Public Forum to educate employees. Also has invited experts to give insight to employees in such matters by invite the expert to give knowledge of H1N1 2009. It also focuses on quality of life for employees to be coupled with the growth of the business and focus on health of employees, both physical and psychological by providing an ongoing health check every year.

Management

50 49

Internal Control The Board of Directors has appointed an Audit Committee consisting of 3 independent directors, none of whom holds any position in the Company. The Audit Committee’s responsibility is for the oversight of the financial report preparation for accuracy, adequate disclosure, compliance to the governing rules and regulations and effective internal control process. The Company has engaged a consultant to supervise the internal audit process with a report done on a quarterly basis in 2009. The consultant regularly meets with the Audit Committee to review the audit results and the adequacy of the internal control process.

The Audit Committee’s report is attached.

51 50

Internal Control

Audit Committee Report To the Shareholders of Pico (Thailand) Public Company Limited The Audit Committee of Pico (Thailand) Public Company Limited consists of Mr. Chaiyod Bunyagidj as a Chairman, Mr. Sern Vithespongse and Mrs. Sasitorn Phongsatorn as members of the Committee.

The Audit Committee performs its duty and responsibility pursuant to the delegation of the Board of Directors. In 2009, there are 8 meetings held with the executive management and the independent auditor for all related agenda. The summary of operating results of the Audit Committee is as follows : Financial Report Preparation, the Committee diligently reviewed the quarterly and annual financial report for 2009 with the executive management and the independent auditor to ensure that the consolidated statements are fairly presented in accordance with the generally accepted accounting principles and disclosures are accuracy and adequacy. The Committee reviewed intercompany transactions to be a normal course of business and to be complied with the rules and regulations of the Stock Exchange of Thailand.

Internal Control, the Committee reviewed an internal control with the executive management and the independent auditor to ensure that the Company has a reliable internal control. In addition, the Committee provided an observation and constructive comments on material matters according to the internal audit report for improvement of operations to be more effective and efficient and each operational department to have an adequate control process in place.

Risk Management, the Executive committee and the Executive management realized the importance of risk management. They appointed a dedicated risk management system to present and reduce risks that may affect the Company’s performance.

Related Transactions, the Committee reviewed all related transactions to ensure that they were conducted at arms length and is strictly normal trade transactions that the Company closely abides by its commitment to good governance.

Compliance, the Committee reviewed transactions for compliance to the rules and regulations of the Stock Exchange of Thailand and other related business laws.

Complete compliance is noted.

Good Governance, the Company is found to abide by its commitment to the concept of good governance. Its operation is conducted in a transparent and accountable manner with all stakeholders’ interest in mind.

Internal Control

52 51

The Committee also reviewed the selection of the independent auditor for the Board of Directors to present to the shareholders for ratification. Mrs. Nachalee Boonyakarnkul, Certified Public Accountant No. 3126, and/or Mr. Niti Jungnitnirundr Certified Public Accountant No. 3809 and/or Miss Wimolporn Boonyusthian Certified Public Accountant No. 4067 of Deloitte Touche Tohmatsu Jaiyos Audit Co., Ltd. are recommended to be elected as the Company’s independent auditor for 2010 with a stipend of Baht 1,938,000.

On behalf of the Audit Committee

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

(Mr. Chaiyod Bunyagidj) Chairman of the Audit Committee Pico (Thailand) Public Company Limited

53 52

Internal Control

Intercompany Transactions Various intercompany transactions were conducted and recorded during the year.

Merchandise costs and services charges involved in transactions with subsidiary and associated companies or entities that may be deemed as having conflict of interest are recorded at market with the transactions conducted under prevailing terms and conditions of the trade. Details are disclosed in the notes item 24 attached to the financial statements for the year ended October 31, 2009.

Regulation and approval process for intercompany transactions The independent directors have oversight on intercompany transactions and review all such transactions deemed to be potentially conflict of interest. The board of directors then approved all such transactions with directors involved in such transactions abstaining from participating in the decision making.

Future intercompany transactions Intercompany transactions with shareholders or related companies are in line with general business practice giving access to share the intellectual property rights of the joint ventures. The executive management, in approving such transactions, places maximum benefits to the Company as the foremost criterion.

It is expected that related transactions such as sales with accompanying trade payable and purchases with trade credit and service fees will continue as normal trade engagements. Related transactions will be reviewed to ensure that they are normal trade transaction. Compliance to the announcements of the Stock Exchange of Thailand will be ensured with persons with vested interest prohibited from the decision making process.

Intercompany Transactions

54 53

Operating Results and Financial Position Financial Statements

Summary of Report of the Independent Certified Public Accountants The report of the independent certified public accountants for last three fiscal years from years 2007 to 2009 are an unqualified opinion on the consolidated and separated financial statements which present fairly, in all material respects, the financial position, the results of operations, and its cash flows in accordance with generally accepted accounting principles.

Year

Certified Public Accountant

Auditor’s Office

Registration No.

Auditor’s Opinion

2007 2008 2009

Nachalee Boonyakarnkul Nachalee Boonyakarnkul Nachalee Boonyakarnkul

Deloitte touché Tohmatsu Jaiyos Audit Co., Ltd Deloitte touché Tohmatsu Jaiyos Audit Co., Ltd Deloitte touché Tohmatsu Jaiyos Audit Co., Ltd

3126 3126 3126

Unqualified Unqualified Unqualified

Summary of Operating Results and Financial Position A summary of operating results and financial position for the years ended October 31, is as follows : Unit: Baht thousand

55 54

Consolidated Financial Statements 2007 2008 2009

Separate Financial Statements 2007 2008 2009

Cash and cash equivalents Trade account receivables Total current assets Investments in subsidiaries and associated companies Property, plant and equipment Total assets Trade accounts payable Total current liabilities Total liabilities Total shareholders’ equity Book value per share (Baht)

86,309 174,429 497,749

144,018 197,862 459,846

91,139 103,207 301,563

68,835 154,882 448,284

124,337 189,187 426,696

67,534 87,688 259,513

10,952 109,798 626,717 178,062 293,871 298,548 328,169 2.86

12,263 108,828 597,807 130,820 246,011 251,480 346,327 3.02

14,074 94,696 420,386 72,628 122,142 123,823 296,564 2.59

32,051 91,944 576,838 159,542 257,372 262,049 314,789 2.75

32,051 97,321 567,822 131,333 226,214 231,683 336,139 2.93

32,051 85,848 382,448 61,036 100,948 102,629 279,820 2.44

Unit: Baht thousand

Consolidated Financial Statements 2007 2008 2009

Revenues from the rendering of services Other income Gross profit Total expenses Net income (loss) Earnings (losses) per share (Baht)

1,035,170 7,307 227,817 168,607 50,138 0.44

Operating Results and Financial Position

1,008,196 16,000 256,219 185,385 64,484 0.56

583,437 6,055 124,668 157,028 (29,877) (0.26)

Separate Financial Statements 2007 2008 2009 901,019 33,916 183,073 136,944 69,207 0.60

931,595 22,347 222,023 160,134 67,351 0.59

506,181 4,120 96,279 135,662 (35,620) (0.31)

Unit: Baht thousand Net cash provided by (used in) Operating activities Investing activities Financing activities Cash & cash equivalents balance Increase (decrease), net As at beginning As at ending

Consolidated Financial Statements 2007 2008 2009

Separate Financial Statements 2007 2008 2009

10,570 (21,496) (39,430)

109,779 (9,033) (43,037)

(14,221) (6,572) (32,086)

28,889 (34,214) (37,059)

110,386 (6,262) (48,622)

(28,883) (3,806) (24,114)

(50,357) 136,666 86,309

57,709 86,309 144,018

(52,879) 144,018 91,139

(42,385) 111,220 68,835

55,502 68,835 124,337

(56,804) 124,337 67,534

Please see further information in the report of the independent certified public accountants and financial statements in the attachment 3. ƒ

Significant Financial Ratio Consolidated Financial Statements 2007 2008 2009 Liquidity Ratios Current ratio (time) Quick ratio (time) Cash current ratio (time) Receivable turnover (time) Collection (day) Trade payable turnover (time) Payment (day) Profitability Ratios Gross operating profit (%) Operating profit (%) Net profit (%) Return on equity (%) Operating Efficiency Return on assets (%) Return on fixed assets (%) Assets turnover (time) Key Financial Indicators Total debts to equity ratio (time) Interest coverage (time) Book value per share (Baht) Earning per share (Baht) Dividend per share (Baht)

Separate Financial Statements 2007 2008 2009

1.7 1.7 0.3 6.9 53 5.7 64

1.9 1.5 0.6 5.4 67 4.9 74

2.5 2.1 0.8 3.9 93 5.7 63

1.7 1.7 0.3 6.8 53 5.5 65

1.9 1.5 0.6 5.4 67 4.9 74

2.6 1.5 0.7 2.8 130 5.3 68

22 6 5 16

25 9 6 19

21 (5) (5) (10)

20 9 7 23

24 9 7 20

19 (7) (7) (13)

9 46 1.8

11 59 1.7

(6) (23) 1.2

13 75 1.8

12 71 1.7

(8) (27) 1.1

0.9 76.2 2.86 0.44 0.30

0.7 154.6 3.02 0.56 0.38

0.4 (49.1) 2.59 (0.26) 0.18

0.8 149.5 2.75 0.60 0.30

0.7 178.1 2.93 0.59 0.38

0.4 (98.6) 2.44 (0.31) 0.18

Operating Results and Financial Position

56 55

Explanation and Analysis of Operating Results and Financial Position ƒ

Operation Overview The world economic crisis, uncertainty of political matter in Thailand, and H1N1 flu outbreak in year 2009 have significantly impacted to operations, down more than 40% in comparison with last year operation. For instance, the Company has huge loss from Bio Asia 2009 in November 2008 as the international airport was closed by protester of government. In addition, we lost a big project i.e. ICT & ITU 2009 as the Ministry of Information and Communication Technology changed a decision not to have an event.

As such, sales are down to Baht 583 million with its gross profit of Baht 125 million.

Since sales volume dropped, the Company did control and reduce overhead down by Baht 28 million or a decrease of 15% in comparison with last year. Therefore, the Company has net loss of Baht 30 million and EPS is loss of Baht 0.26 per share.

Revenue from the Rendering of Services Million Baht Trade show and exhibition Event Marketing Permanent Exhibition & Museum Organizer Others

2007 % Million Baht

2008 % Million Baht

2009 %

413 156 292 174

40 15 28 17

417 171 47 150 223

41 17 5 15 22

313 88 56 21 106

54 15 10 4 17

1,035

100

1,008

100

584

100

Since significant impact from economic and political matters to operation of year 2009, all types of revenues are sharply dropped. Approximately 70% of total revenues are derived from trade show and exhibition and event marketing. In overall both of such typed revenues are decreased by 30% while permanent exhibition and museum sales volume are the same level as last year because the Company has continually delivered services. Sales from organizer business decreased to Baht 21 million as last year the Company had a big project from the Ministry of Information and Communication Technology while sales from other business down more than 50% due to revenues from overseas dropped.

Other Income The Company has other income mainly from dividend income, share of profit from investments using the equity method and others totaling of Baht 6 million decreased from last year because of rebate from suppliers from overseas projects down.

57 56

Operating Results and Financial Position

Gross Profit In year 2009, the Company has gross profit and gross profit margin decreased to Baht 125 million and 21% respectively, as impact from economy and politic. Gross profit margin in last year seemed higher than current year because last year the Company had more revenues from overseas with its gross profit margin higher than domestic revenues.

Selling and Administrative Expenses As revenues decreased, the Company did try to balance overhead especially in the relation to employees, decreasing by Baht 24 million. Therefore, selling and administrative expenses decreased by 15% to Baht 157 million.

Net Income (Losses) and Earnings (Losses) per Share As above explanation, the Company has net loss in year 2009 of Baht 30 million and net loss per share of Baht 0.26 as well as return on assets and return on equity are shown negative at 6% and 10% respectively.

Cash Flows From a decrease in operation for year 2009, the Company used cash for operating activities around Baht 14 million and investing activities around Baht 7 million of which is for fixed assets purchases and computer software. In addition, the Company used cash for financing activities around Baht 32 million mainly for dividend paid of Baht 22 million. As such, as of October 31, 2009 the Company has cash and cash equivalent of Baht 91 million of which Baht 60 million is invested in bill of exchange for interest income. ƒ

Analysis of Financial Position Since an operation shrink, total assets as of October 31, 2009 are accordingly down by 30%; however, the Company is still very strong in the financial position and has sufficient funds from cash balances more than Baht 90 million, balance of current assets higher than balance of current liabilities almost 2.5 times. In addition, balance of total liabilities per total assets is less than 0.29 times.

As of October 31, 2009, the Company has the net book value of Baht 2.59 per share.

Cash and Cash Equivalents Cash and cash equivalent as of October 31, 2009 decreased to Baht 91 million or 22% of total assets as a result of operation down. However, the Company has kept liquidity by cash current ratio improved from 0.2 times to 0.8 times.

Operating Results and Financial Position

58 57

Trade Account Receivables As of October 31, 2009, the Company has trade accounts and notes receivable of Baht 103 million decreased by Baht 95 million or a decrease of 48% according to revenues decreased. On average collection period increased to 93 days because receivable from government sector which its regulation and payment procedure takes longer period than private sector receivable. However, all balances with its outstanding more than 12 months period have been provided provision for doubtful.

The aging of trade account receivables as follows : Million Baht Not to due date Within 3 months Between 3 months to 6 months Between 6 months to 12 months More than 12 months Note Receivables Less Allowance for doubtful account

2007 % Million Baht

2008 % Million Baht

2009 %

103 37 19 15 1 -

59 21 11 8 1 -

133 21 22 18 4 -

67 11 11 9 2 -

47 10 32 5 8 8 (7)

46 10 31 5 7 8 (7)

175

100

198

100

103

100

Total Current Assets Total current assets decreased by Baht 158 million or 34% to Baht 301 million. Mainly decrease is from a decrease of the gross amount due from customers for contract work as a result of revenue dropped. However, total current assets are higher than total liabilities by Baht 178 million and current ratio is 2.5 times.

Investment in Subsidiary and Associated Companies There are no significant changes in investments in subsidiary and associated companies except share of profit from investments using the equity method by the accounting standard. Please see the details of investments in subsidiary and associated companies in “Business Operation�.

Property, Plant and Equipment During the year 2009, the Company invested computer software and operating equipment to replace a disposal around Baht 3 million. In year 2009, the Company has depreciation of Baht 17 million and property, plant and equipment, net as of October 31, 2009 are Baht 95 million.

Trade Accounts Payables As of October 31, 2009, the Company has trade accounts payable of Baht 73 million down by Baht 58 million or 44% according to revenues decreased. On average payment period in current year is down to 63 days reflecting liquidity of the Company is strong.

59 58

Operating Results and Financial Position

Total Liabilities As of October 31, 2009, the Company has total liabilities of Baht 124 million decreased

by Baht 128 million or approximately 51% decreased. Most of such total liabilities are current liabilities of Baht 122 million of which trade accounts payable of Baht 73 million, other payables of Baht 14 million, accrued expenses of Baht 8 million and other current liabilities of Baht 19 million.

Shareholders’ Equity and Net Book Value As of October 31, 2009, the shareholders’ equity is Baht 297 million decreased by Baht 50 million due to loss from operations of Baht 30 million and the second interim dividend paid in year 2008 at rate of Baht 0.18 per share totaling Baht 21 million. As such, the net book value is Baht 2.59 per share.

Audit Remuneration The audit fee for year ended October 31, 2009 is Baht 2.04 million.

Operating Results and Financial Position

60 59

Other Information - None –

61 60

Other Information

Part III Certification of Factual Accuracy “We have carefully reviewed the annual information disclosure format with due care and attention, as executive directors of the company or as the senior-most officeholder in accounting. We certify that the said information is complete, factual and containing no untruths or lacking in material information that should be disclosed.

Furthermore, we certify that: 1. The financial statements and related financial information are part of the annual information disclosure. The information so presented displays complete and material information related to the financial condition, operating results and cash flows of the company.

2. We are responsible to ensure that the company adopted an effective information disclosure and that pertinent and material information of the Company be disclosed correctly and completely. This also covers the supervision of the implementation of the said disclosure process.

3. We are responsible to ensure that the Company implemented a good internal control system and to supervise that the said system is adhered to. We have informed the auditors and the audit committee of our assessment of the internal control system on December 11, 2009. This covers the deficiencies and material changes to the internal control system including the misdeeds which may affect the preparation of the Company’s financial report.

Therefore, as evidence that all of the documents presented are the same documents that we have certified, we have delegated Mr. Chaijit Tehasuwanarat to sign on each page of these documents on our behalf. Should Mr. Chaijit Tehasuwanarat’s signature be missing from any page, we shall consider that it is not the information that we have certified.”

Name

Position

Signature

Mr. Chia Song Heng

Director and Chairman

Mr. Pised Chungyampin

Director and Executive Chairman

Mr. Silchai Kiatpapan

Director and Chief Executive Officer

Authorized Person

Position

Mr. Chaijit Tehasuwanarat

Chief Financial Officer

Signature

Part III Certification of Factual Accuracy

62 61

Certification of factual accuracy “We have reviewed the information contained in this annual report. With due care and diligence as directors of the Company, we have no reason to believe that the stated information is not complete or containing untruths which may falsely lead others to believing, or lacking in material information that should be disclosed.

Therefore, to signify that all documents hereby presented, are the same as what we have certified we delegate Mr. Chaijit Tehasuwanarat to sign on all pages on our behalf. Should Mr. Chaijit Tehasuwanarat’s signature be missing from any page, we shall consider that it is not the information that we have certified.”

63 62

Name

Position

Mr. Chung Chee Keong

Director

Mr. Viriya Pholpoke

Director and Executive Advisor

Mr. Chaiyod Bunyagidj

Chairman of Audit Committee and Independent Director

Mr. Sern Vithespongse

Audit Committee and Independent Director

Mrs. Sasitorn Phongsathorn

Audit Committee and Independent Director

Authorized Person

Position

Mr. Chaijit Tehasuwanarat

Chief Financial Officer

Part III Certification of Factual Accuracy

Signature

Signature

57

55

53

4ภ

2. Mr. Pised Chungyampin

3. Mr. Silchai Kiatpapan

4. Mr. Chung Chee Keong

Age (Years)

1. Mr. Chia Song Heng

Name

Directors Accreditation Program Directors Certification Program (DCP) class 48/2004: IOD Bachelor’s degree in Accounting, National University of Singapore

Directors Accreditation Program Directors Certification Program class 51/2004: IOD Bachelor’s Degree: Public Health, Mahidol University

Mini MBA Thammasart University

Bachelor’s Degree: the Faculty of Architecture King Mongkut’s Institute of Technology

Executive Program, Stanford University - National University of Singapore

Education

Jun 6, 2008 present

2003 – Oct 31, 2006

Nov 1, 2006 present

Pico (Thailand) Plc. Pico Art International Pte Ltd Deputy Vice President of Finance

Pico (Thailand) Plc.

Pico (Thailand) Plc.

Pico (Thailand) Plc.

Pico Far East Holding Pte Ltd. Pico (Thailand) Plc.

Pico (Thailand) Plc.

Company

Director

Chief Operating Officer and Director

Chief Executive Officer

Vice Chairman and Chief Executive Officer and Director

Director Vice Chairman and Executive Chairman

2002 - present Nov 1, 2006 present 2003 Oct 31, 2006

Chairman of the Board of Directors and Vice Chairman of the Executive Committee

Position

2004 – present

Period

Attachment I Details on Executives and Authorized Managers of the Company

-

1.27

25.61

(including shares held by close relatives and minor children)

-

% of Shareholding

5 Years Working Experiences

Attachment I Details on Executives and Authorized Managers of the Company

64 65

56

55

56

52

6. Mr. Chaiyod Bunyagidj

7. Mr. Sern Vithespongse

8. Mrs. Sasitorn Phongsathorn

Age (Years)

5. Mr. Viriya Pholpoke

Name

Directors Certification Program (DCP) class 58: IOD

Master Degree in Business Administration, Notre Dame University, California, U.S.A

Bachelor of Science in Chemical Engineer, Chulalongkorn University

Directors Accreditation Program: IOD

Directors Accreditation Program: IOD Bachelor’s Degree: Architecture, from Silpakorn University

Directors Accreditation Program: IOD Ph.D. in Chemistry: The American University, Washington D.C., USA.

BS. (Computer) University of Central Oklahoma, Oklahoma, USA.

Bachelor’s Degree: Science (Accounting), Kasetsart University

Education

2004 - 2005

Senior Director, Corporate Finance

Vice President

President

Dec 19, 2005 – present Jul 1, 2005 – Dec 18, 2005

Audit Committee and Independent Director

Director

Vice President Audit committee and independent director

Nov 17, 2005 – present

1992 - present

1997 – present 2003 – present

Chairman of the audit committee and independent director

Audit committee and independent director

2003 Sep 1, 2005

2003 – present

Director and advisor

Position

Sep 2, 2008 – present

Period

United Advisory Services Co., Ltd.

Book Club Finance Public Co., Ltd.

Land and Houses Retail Bank Plc.

Palmer and Turner (Thailand) Co., Ltd. Pico (Thailand) Plc.

Thailand Environment Institute Pico (Thailand) Plc.

Pico (Thailand) Plc.

Pico (Thailand) Plc.

Pico (Thailand) Plc.

Company

Attachment I Details on Executives and Authorized Managers of the Company

-

-

-

-

% of Shareholding

5 Years Working Experiences

66 65

49

41

43

10. Miss Supaporn Sawangjitt

11. Mr. Chaijit Tehasuwanarat

Age (Years)

9. Mr.ChokchaiVatcharanirunkul

Name

Bachelor’s Degree in Accounting: University of the Thai Chamber of Commerce

Bachelor’s Degree: Political Science, Ramkhamheang University Bachelor’s Degree: Fine Arts and Applied Art, Chulalongkorn University International Banking and Finance, University of Birmingham, U.K.

Master Degree: Master of Arts in Political Science, Ramkhamheang University

Education

Pico (Thailand) Plc. Creative In-house Ltd.

Finance Director

2005 – Apr 30, 2008

Pico (Thailand) Plc.

Pico (Thailand) Plc.

Company

Chief Financial Officer

Executive Vice President

Senior Executive Vice President

Position

May 1, 2008 – present

2003 - present

2001 - present

Period

Attachment I Details on Executives and Authorized Managers of the Company

-

0.32

0.54

% of Shareholding

5 Years Working Experiences

66 67

/ / // // //

7. Mr. Sern Vithespongse

8. Mrs. Sasitorn Phongsathorn

9. Mr. Chokchai Vatcharanirunkul

10. Miss Supaporn Sawangjitt

11. Mr. Chaijit Tehasuwanarat

// : Executive Committee

/

6. Mr. Chaiyod Bunyagidj

/ : Director

/

5. Mr. Viriya Pholpoke

X : Chairman

/

4. Mr. Chung Chee Keong

/, //

X, /, //

2. Mr. Pised Chungyampin

3. Mr. Silchai Kiatpapan

X, /, //

1. Mr. Chia Song Heng

Name list

Pico (Thailand) Plc.

/

/

/

-

-

-

-

-

-

-

-

NOX Bangkok Co., Ltd.

/

/

-

-

-

-

-

-

-

-

-

Multi Designs Co., Ltd.

-

-

/

-

-

-

-

-

-

-

-

Inkjet Images (Thailand) Co., Ltd.

/

-

-

-

-

-

-

-

-

-

-

Ibrix Co., Ltd.

-

-

-

-

-

-

-

-

-

-

-

DesignLab MISC Co., Ltd.

Attachment II Details on Directors of the Company, Subsidiaries and Associated Companies

/

-

/

-

-

-

-

-

-

-

-

PX System Co., Ltd.

Attachment II Details on Directors of the Company, Subsidiaries and Associated Companies

68 67

Attachment III Report of the Independent Certified Public Accountants and Financial Statements Report of the Independent Certified Public Accountants To the Shareholders and Board of Director Pico (Thailand) Public Company Limited We have audited the consolidated balance sheets of Pico (Thailand) Public Company Limited and its subsidiaries and the separate balance sheets of Pico (Thailand) Public Company Limited as at October 31, 2009 and 2008 and the related consolidated and separate statements of income, changes in shareholders’ equity and cash flows for the years then ended. These financial statements are the responsibility of the Company’s management as to their correctness and completeness of the presentation. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing standards.

Those standards require that we plan and perform the audit to obtain reasonable assurance as to whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the aforementioned consolidated and separate financial statements present fairly, in all material respects, the financial position of Pico (Thailand) Public Company Limited and its subsidiaries and of Pico (Thailand) Public Company Limited as at October 31, 2009 and 2008, and the results of its operations and its cash flows for the years then ended in accordance with generally accepted accounting principles.

Bangkok December 11, 2009

69 68

Nachalee Boonyakarnkul Certified Public Accountant (Thailand) Registration No. 3126 Deloitte Touche Tohmatsu Jaiyos Audit Co., Ltd.

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

Pico (Thailand) Public Company Limited and Subsidiaries Balance Sheets As at October 31, 2009 and 2008 Baht

Notes ASSETS Current Assets Cash and cash equivalents Cash and cash equivalents - Joint Venture Current investments Trade accounts receivable, net Amounts due from related parties Amounts due from related parties - Joint Venture Short-term loan to a related party Other current assets The gross amount due from customers for contract work, net Bill of exchange used as collateral - Joint Venture Others Others - Joint Venture

5 6 24

Total Non-Current Assets TOTAL ASSETS

Separate Financial Statements 2009 2008

31,083,358 58,331,004 17,533,706 39,417,100 56,129 767,055 60,000,000 84,920,247 50,000,000 84,920,247 103,207,311 197,862,064 87,688,076 189,186,592 239,787 96,575 544,213 516,064

7 and 24

15,557 885,600

15,557 885,600

1,476,000

1,476,000

8 and 24

42,743,579

62,983,094

42,009,374

61,377,035

9

Total Current Assets Non-Current Assets Deposits at banks used as collateral Investments in subsidiaries, associated companies and Joint Venture, net Other long-term investments Property, plant and equipment, net Intangible assets, net Other non-current assets Other non-current assets - Joint Venture

Consolidated Financial Statements 2009 2008

1,476,000 1,476,000 61,796,679 52,372,415 60,261,224 49,803,174 58,850 136,650 301,562,850 459,846,261 259,512,593 426,696,212

10 11 and 24 12 13

310,000

310,000

-

-

14,074,441 12,263,206 32,051,047 32,051,047 3,395,025 3,229,025 94,696,549 108,827,642 85,847,642 97,321,138 5,671,283 4,441,258 5,021,612 4,238,630 668,683 8,322,193 15,400 7,515,400 7,640 567,352 118,823,621 137,960,676 122,935,701 141,126,215 420,386,471 597,806,937 382,448,294 567,822,427

Notes to the financial statements form an integral part of these statements Attachment III Report of the Independent Certified Public Accountants and Financial Statements

70 69

Pico (Thailand) Public Company Limited and Subsidiaries Balance Sheets (Continued) As at October 31, 2009 and 2008 Baht

Notes LIABILITIES AND SHAREHOLDERS’ EQUITY Current Liabilities Bank overdrafts and short-term loan from financial institutions Trade accounts payable Short-term loan from related parties - Joint Venture Current portion of obligations under hire-purchase agreements Amounts due to related parties Amount due to a related party - Joint Venture Other current liabilities Accrued expenses Accrued expenses - Joint Venture The gross amount due to customers for contract work Deposits received from customers Others

14 15

Total Non-Current Liabilities TOTAL LIABILITIES

71 70

Separate Financial Statements 2009 2008

664,494 7,632,327 72,627,684 130,820,106 61,036,490 131,332,689 944,800

1,948,882

-

-

17 24

2,112,235 2,927,877 2,112,235 2,927,877 13,303,671 21,380,866 13,303,671 21,380,866 422,496 422,496 -

24

7,656,201 54,796

16 and 24

3,544,732 12,080,691 3,544,732 11,239,565 2,039,771 6,189,802 1,446,666 5,676,697 18,771,299 28,883,622 14,733,180 24,292,934

Total Current Liabilities Non-Current Liabilities Obligations under hire-purchase agreements Other non-current liabilities

Consolidated Financial Statements 2009 2008

33,635,642 88,825

4,770,957 -

29,363,440 -

122,142,179 246,011,136 100,947,931 226,214,068 17

1,559,668 121,100

4,158,248 1,310,674

1,559,668 121,100

4,158,248 1,310,674

1,680,768 5,468,922 1,680,768 5,468,922 123,822,947 251,480,058 102,628,699 231,682,990

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

Pico (Thailand) Public Company Limited and Subsidiaries Balance Sheets (Continued) As at October 31, 2009 and 2008 Baht

Notes LIABILITIES AND SHAREHOLDERS’ EQUITY (Continued) Shareholders’ Equity Share Capital Registered share capital 330,000 preferred shares of Baht 1 each 114,670,000 ordinary shares of Baht 1 each

Consolidated Financial Statements 2009 2008

Separate Financial Statements 2009 2008

330,000 330,000 330,000 330,000 114,670,000 114,670,000 114,670,000 114,670,000 115,000,000 115,000,000 115,000,000 115,000,000

Issued and paid-up share capital 330,000 preferred shares of Baht 1 each, fully paid 114,669,980 ordinary shares of Baht 1 each, fully paid

330,000

330,000

330,000

330,000

114,669,980 114,669,980 114,669,980 114,669,980 114,999,980 114,999,980 114,999,980 114,999,980

Additional Paid-In Capital Premium on ordinary shares, net Land Revaluation Surplus Retained Earnings Appropriated Legal reserve Unappropriated Total Company Shareholders’ Equity Minority Interest TOTAL SHAREHOLDERS' EQUITY TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY

18 12

101,250,000 101,250,000 101,250,000 101,250,000 27,917,379 27,917,379 27,917,379 27,917,379

11,500,000 11,500,000 11,500,000 11,500,000 35,433,941 86,010,988 24,152,236 80,472,078 291,101,300 341,678,347 279,819,595 336,139,437 5,462,224 4,648,532 296,563,524 346,326,879 279,819,595 336,139,437 420,386,471 597,806,937 382,448,294 567,822,427

Notes to the financial statements form an integral part of these statements Attachment III Report of the Independent Certified Public Accountants and Financial Statements

72 71

Pico (Thailand) Public Company Limited and Subsidiaries Statements of Income For the Years ended October 31, 2009 and 2008 Baht

Notes REVENUES Revenues from the rendering of services Dividend income Other income Other income - Joint Venture Share of profits from investments using the equity method

24 24 24

Separate Financial Statements 2009 2008

583,436,908 1,008,195,686 562,030 304,355 2,841,509 13,283,037 54,796 52,120

506,181,009 931,595,194 200,000 9,449,329 3,920,394 12,897,900 -

2,596,235

Total Revenues EXPENSES Costs of the rendering of services Selling and administrative expenses Selling and administrative expenses - Joint Venture

Consolidated Financial Statements 2009 2008

24 24

Total Expenses

2,360,955

-

-

589,491,478

1,024,196,153 510,301,403 953,942,423

458,768,834 156,717,922

751,976,899 185,317,605

409,901,909 135,661,545

709,572,031 160,133,952

310,329

67,700

-

-

615,797,085 937,362,204 545,563,454 869,705,983

Income (Loss) before Interest Expenses and Income Tax Interest Expenses Interest Expenses – Joint Venture Income Tax Income Tax – Joint Venture

(26,305,607) 86,833,949 (35,262,051) 84,236,440 480,507 510,234 357,795 472,902 54,796 51,622 2,222,449 19,980,875 - 16,413,029 82,594 -

NET INCOME (LOSS)

(29,063,359) 66,208,624 (35,619,846) 67,350,509

Profit (Loss) Attributable to Equity holders of the parent Minority interests

(29,877,051) 64,483,589 (35,619,846) 67,350,509 813,692 1,725,035 (29,063,359)

BASIC EARINGS (LOSSES) PER SHARE Weighted Average Number of Ordinary Shares

22 Shares

66,208,624 (35,619,846)

67,350,509

(0.26) 0.56 (0.31) 0.59 114,669,980 114,669,980 114,669,980 114,669,980

Notes to the financial statements form an integral part of these statements

73 72

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

330,000

114,669,980

114,669,980 -

114,669,980

114,669,980 -

101,250,000

101,250,000 -

101,250,000

101,250,000 -

Premium on Share Capital l Ordinary Shares

27,917,379

27,917,379 -

27,917,379

27,917,379 -

11,500,000

11,500,000 -

11,500,000

11,500,000 -

35,433,941

86,010,988 (29,877,051) (20,699,996)

86,010,988

67,527,391 64,483,589 (45,999,992)

Land Appropriated Unappropriated Revaluation Legal Surplus Reserve

5,462,224

4,648,532 813,692 -

4,648,532

4,974,167 1,725,035 (2,050,670)

Minority Interest

74 73

296,563,524

346,326,879 (29,063,359) (20,699,996)

346,326,879

328,168,917 66,208,624 (48,050,662)

Total Shareholders’ Equity

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

Notes to the financial statements form an integral part of these statements

Ending balance, October 31, 2009

330,000 -

21

330,000

330,000 -

Beginning balance, November 1, 2008 Net income (loss) Dividends paid

21

Notes

Issuedand Paid-Up ShareCapital Preferred Ordinary Shares Shares

Ending balance, October 31, 2008

Beginning balance, November 1, 2007 Net income Dividends paid

Baht

Pico (Thailand) Public Company Limited and Subsidiaries Consolidated Statements of Changes in Shareholders’ Equity For the Years ended October 31, 2009 and 2008

330,000

114,669,980

114,669,980 -

114,669,980

114,669,980 -

101,250,000

101,250,000 -

101,250,000

101,250,000 -

Premium on Share Capital l Ordinary Shares

27,917,379

27,917,379 -

27,917,379

27,917,379 -

11,500,000

11,500,000 -

11,500,000

11,500,000 -

Land Appropriated Revaluation Legal Surplus Reserve

24,152,236

80,472,078 (35,619,846) (20,699,996)

80,472,078

59,121,561 67,350,509 (45,999,992)

Unappropriated

279,819,595

336,139,437 (35,619,846) (20,699,996)

336,139,437

314,788,920 67,350,509 (45,999,992)

Total Shareholders’ Equity

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

Notes to the financial statements form an integral part of these statements

Ending balance, October 31, 2009

330,000 -

21

330,000

330,000 -

Beginning balance, November 1, 2008 Net loss Dividends paid

21

Notes

Issuedand Paid-Up ShareCapital Preferred Ordinary Shares Shares

Ending balance, October 31, 2008

Beginning balance, November 1, 2007 Net income Dividends paid

Baht

Pico (Thailand) Public Company Limited and Subsidiaries Separate Statements of Changes in Shareholders’ Equity For the Years ended October 31, 2009 and 2008

7574

Pico (Thailand) Public Company Limited and Subsidiaries Statements of Cash Flows For the Years ended October 31, 2009 and 2008 Baht

Notes Cash Flows from Operating Activities Income (loss) before income tax Items to reconcile income (loss) before income tax to net cash flows provided by (used in) operating activities: Depreciation and amortization Doubtful accounts and bad debt (Profits) losses on sale and writing off of fixed assets and intangible assets Unrealized losses on exchange rate Dividends received from investments using the equity method Share of profits from investments using the equity method Interest expenses Income (loss) from operations before changes in operating assets and liabilities Operating assets (increase) decrease Trade accounts receivable Amounts due from related parties Amounts due from related parties – Joint Venture The gross amount due from customers for contract work Other current assets Other current assets – Joint Venture Other non-current assets Other non-current assets –Joint Venture

Consolidated Financial Statements 2009 2008

Separate Financial Statements 2009 2008

(26,840,910) 86,272,093 (35,619,846) 83,763,538

17,661,849 17,295,185 13,033,746 12,054,695 5,654,230 4,116,500 5,433,142 4,116,500 206,520 22,952

(846,658) 1,188

203,671 22,952

(945,784) 1,188

785,000

1,049,998

-

-

(2,596,235) (2,360,955) 480,507 510,234

357,795

472,902

(4,626,087) 106,037,585 (16,568,540) 99,463,039 86,418,678 (23,540,174) 93,182,703 (34,411,310) (143,227) 17,474 (28,164) 173,299 -

2,882

-

-

22,986,645 104,378,061 22,177,590 96,195,456 4,405,512 10,886,135 3,464,412 10,438,148 77,800 714,874 7,653,510 (6,599,749) 7,500,000 (6,389,104) 559,712 (649,946) -

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

76 75

Pico (Thailand) Public Company Limited and Subsidiaries Statements of Cash Flows (Continued) For the Years ended October 31, 2009 and 2008 Baht

Notes Cash Flows from Operating Activities (Continued) Operating liabilities increase (decrease) Trade accounts payable Amounts due to related parties Accrued expenses Accrued expenses – Joint Venture The gross amount due to customers for contract work Deposits received from customers Other current liabilities Other current liabilities – Joint Venture Other non-current liabilities Cash received (paid) from operations Cash paid for interest Cash paid for income tax Net cash provided by (used in) operating activities

77 76

Consolidated Financial Statements 2009 2008

Separate Financial Statements 2009 2008

(58,210,294) (47,259,282) (70,314,071) (28,226,255) (8,082,018) 733,331 (8,082,018) 729,935 (25,979,441) 7,150,115 (24,592,483) 8,299,454 (34,029) 51,622 (8,535,959) (1,721,160) (7,694,833) 1,535,418 (4,150,031) (17,077,501) (4,230,031) (16,522,155) (7,246,810) 2,212,511 (8,300,235) 767,361 - (295,200) (1,189,574) 1,310,674 (1,189,574) 1,310,674 3,904,387 136,352,252 (14,675,244) 133,363,960 (480,507) (510,234) (357,795) (472,902) (17,644,863) (26,063,007) (13,849,962) (22,504,714) (14,220,983) 109,779,011 (28,883,001) 110,386,344

Cash Flows from Investing Activities Cash paid from deposits at banks used as collateral Cash received from short-term loan from a related company Cash payment for short-term loan to a related company Cash payment for purchase of fixed assets Cash payment for purchase of intangible assets Cash received from sale of fixed assets Purchase of investment in other companies

- (885,600) (4,797,153) (12,998,474) (2,749,782) (12,950,056) (2,223,700) (1,465,933) (1,668,790) (1,466,381) 615,150 2,089,395 612,150 1,464,323 (166,000) (362,315) -

Net cash used in investing activities

(6,571,703) (9,033,451) (3,806,422) (6,262,320)

-

(310,000)

-

-

-

4,899,476

-

6,689,794

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

Pico (Thailand) Public Company Limited and Subsidiaries Statements of Cash Flows (Continued) For the Years ended October 31, 2009 and 2008 Baht

Notes Cash Flows from Financing Activities Bank overdrafts and short-term loan from financial institutions Cash payment for short-term loan from related party – Joint Venture Cash received from short-term loan from related parties - Joint Venture Cash payment for obligations under hire-purchase agreements Dividends paid Dividends of subsidiaries paid to minority shareholders

Separate Financial Statements 2009 2008

(6,967,833)

7,340,554

-

-

(1,004,082)

-

-

-

-

295,200

-

-

(3,414,222) (2,621,717) (3,414,222) (2,621,717) (20,699,996) (45,999,992) (20,699,996) (45,999,992) - (2,050,670)

Net cash used in financing activities

-

-

(32,086,133) (43,036,625) (24,114,218) (48,621,709)

Net increase (decrease) in cash and cash equivalents Cash and cash equivalents as at the beginning Cash and cash equivalents as at the ending

Consolidated Financial Statements 2009 2008

(52,878,819) 57,708,935 (56,803,641) 55,502,315 144,018,306 86,309,371 124,337,347 68,835,032 4.1

91,139,487 144,018,306

67,533,706 124,337,347

Notes to the financial statements form an integral part of these statements Attachment III Report of the Independent Certified Public Accountants and Financial Statements

78 77

Pico (Thailand) Public Company Limited and Subsidiaries Notes to the Financial Statements For the years ended October 31, 2009 and 2008 1. Operations of the Company and Subsidiaries Pico (Thailand) Public Company Limited and subsidiaries are companies registered in Thailand. The information of business and locations of the Company and subsidiaries as at October 31, 2009 and 2008 are as follows: Name

Registered date

Business type

Location

Pico (Thailand) Public Company Limited

March 27, 1992

Design and fabrication of exhibition booths for trade exhibition organizers, company showrooms and shop counters, interiors for museums, theme park and visitor centers

10 Soi Lasalle 56 Sukhumvit Rd., Kwang Bangna, Khet Bangna, Bangkok

PX System Company Limited

February 23, 1995

Nox Bangkok Company Limited *

March 12, 1996

12 Soi Lasalle 56 Sukhumvit Rd., Kwang Bangna, Khet Bangna, Bangkok 10 Soi Lasalle 56 Sukhumvit Rd., Kwang Bangna, Khet Bangna, Bangkok

Multi Designs Company Limited

April 19, 1995

Rental of equipment and contractor on the trade exhibition standard booths Graphic banner and inkjet printing design, design and fabrication of exhibition booths for trade exhibition and interiors for museums Trade exhibition and interior design

Subsidiaries

10 Soi Lasalle 56 Sukhumvit Rd., Kwang Bangna, Khet Bangna, Bangkok

The major shareholder of Pico (Thailand) Public Company Limited is Pico Art International Pte Ltd. which was incorporated in Singapore. The Company became listed on the Market for Alternative Investment on April 20, 2004. *

As at October 31, 2009 and 2008, Nox Bangkok Company Limited was under an organization restructuring plan in order to accommodate the operation in the future.

79 78

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

2. Basis for Preparation of the Consolidated and Separate Financial Statements 2.1 The statutory financial statements are prepared in the Thai language in accordance with accounting standards and practices generally accepted in Thailand.

The brief particulars in the financial statements are presented in accordance with the Notification of the Department of Commercial Registration (currently the Department of Business Development) dated September 14, 2001 regarding “The Brief Particulars in the Financial Statements B.E. 2544”. In addition, the consolidated and separate financial statements have been prepared in accordance with the regulations of the Stock Exchange of Thailand (SET) dated January 22, 2001, regarding the basis, conditions and procedures for the preparation and submission of financial statements and reports for the financial position and results of operations of listed companies B.E. 2544.

In the year 2007, Thai Accounting Standard No.1 (Revised 2007) “Presentation of Financial Statements” (previously No. 35) was announced by Federation of Accounting Professions and applied for the financial statements of periods beginning on or after January 1, 2008. The revised standard has affected on the financial statement presentation, which is different from the presentation according to the Notification as mentioned in the preceding paragraph. However, the consolidated and separate financial statements for the years ended October 31, 2009 and 2008, are presented in accordance with Notification as mentioned in preceding paragraph. The revision of such Thai Accounting Standard has no material impact on the consolidated and separate financial statements.

The Company changes the format of presentation of the statements of cash flows for the years ended October 31, 2009 and 2008 to comply with the Thai Accounting Standard No. 7 (Revised 2007) “Cash Flow Statements” (previously No. 25), which is effective for financial periods beginning on or after January 1, 2008 onwards.

2.2 The consolidated financial statements include the accounts of Pico (Thailand) Public Company Limited, three subsidiaries and Joint Venture (applied proportionate consolidation) by eliminating significant balances and business transactions with such parties.

The portions of the Company’s ownership and investment as at October 31, 2009 and 2008 are as follows: Subsidiaries

% of ownership

PX System Company Limited Nox Bangkok Company Limited Multi Designs Company Limited

90.00 99.99 59.99

Joint Venture

% of proportion

Joint Venture of Ekca Thai Co., Ltd., Pico (Thailand) Pcl. and Bewcon Co., Ltd.

40.00

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

80 79

2.3 Renumbering of Thai accounting standards The Federation of Accounting Professions issued the Notification of Federation of Accounting Professions No. 12/2552 dated May 15, 2009 regarding the renumbering of Thai Accounting Standards (TASs) and Thai Financial Reporting Standards (TFRSs) to be equivalent to the International Accounting Standards and the International Financial Reporting Standards. Therefore, the disclosures of new number of TASs and TFRSs in the financial statements for the years ended October 31, 2009 and 2008 have been used in accordance with such Notification.

2.4 Accounting standards announced but not effective The Federation of Accounting Professions issued the Notification of Federation of Accounting Professions No. 86/2551 dated November 12, 2008 regarding the following accounting standard and financial reporting standard that were announced in the Royal Gazette, but not yet in effect in 2008: Accounting Standards / Financial Reporting Standards

Effective Date

TAS 36 (Revised 2007) TFRS 5 (Revised 2007)

January 1, 2009 January 1, 2009

Impairment of assets Non-current assets held for sales and discontinued operations (previously TAS 54)

The Federation of Accounting Professions issued the Notification of Federation of Accounting Professions No. 16/2552 dated May 21, 2009 regarding the following accounting standards that were announced in the Royal Gazette, but not yet in effect in 2009: Accounting Standards

Effective Date

Accounting Framework (Revised 2007) TAS 20

January 1, 2011 January 1, 2012

TAS 24 (Revised 2007) TAS 40

Accounting for Government Grants and Disclosure of Government Assistance Related Party Disclosures (previously TAS 47) Investment Property

January 1, 2011 January 1, 2011

The Company’s management has assessed the impact of these TASs and TFRSs, when they are effective for financial periods beginning on or after the effective date, and does not expect them to have a material effect on the Company's financial statements.

2.5 Reclassification The Company has reclassified item in the consolidated financial statements for the year ended October 31, 2008 to conform to the classification used in the consolidated financial statements for the year ended October 31, 2009 as follows: Fixed deposits at banks - 3 months Baht 0.32 million which was previously presented as a part of current investments, to be separately presented as deposits at banks use as collateral Baht 0.31 million and cash and cash equivalents at financial institutions Baht 0.01 million, respectively.

81 80

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

3. Significant Accounting Policies The significant accounting policies are summarized below: 3.1 Recognition of revenues Service income is recognized by the percentage of completion method. The percentage of completion is measured by the proportion of actual costs incurred up to the end of the year and the total anticipated cost to be incurred to completion.

Revenues from organizing trade shows, exhibitions and entertainment events are recognized on opening dates of the events.

3.2 Deferred cost of the rendering of services Deferred cost of the rendering of services represent costs incurred relating to services and will be recognized as cost of the rendering of services for which it is held.

3.3 Investments in subsidiaries, associated companies, Joint Venture and other companies Investments in subsidiaries, associated companies and Joint Venture included in the separate financial statements are accounted for by cost method.

Investments in associated companies included in the consolidated financial statements are accounted for by equity method.

Investments in other companies are general investments which are stated at cost.

Debt securities held-to-maturity are stated at the amortized cost.

The difference of net book value at the date of acquisition being over or under cost of investments has been recognized as income or expense in the statement of income.

Management believes that the net book value at the acquisition date approximates to the fair value of investments.

3.4 Property, plant and equipment, net Land is stated at the appraised value. Plant and equipment are stated at cost, net of accumulated depreciation.

Depreciation is computed by the straight-line method, based on the estimated useful lives of the assets as follows: Buildings and building improvement Operating equipment Others

6 - 20 years 3 - 5 years 3 - 5 years

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

82 81

Where the carrying amount of an asset is greater than its recoverable amount, it is written down immediately to its recoverable amount. The recoverable amount is the higher of the anticipated discounted cash flows from the continuing use of the assets and the amount obtainable from the sale of the assets less any costs of disposal.

Increases in carrying amount arising on land revaluation are credited to land revaluation surplus in shareholders’ equity. Where the carrying amount of land is greater than the revalued amount, it is written down in the statement of income.

Revaluation decreases are charged against the related revaluation surplus in respect of the same land to the extent that the decrease does not exceed the amount held in the revaluation surplus in respect of such land; decreases in excess of that amount are charged to the statement of income.

The Company has a policy for revaluation of land used in operations every 5 years by the independent appraisers.

3.5 Intangible assets, net Intangible assets, net consisting of computer software and patent are stated at cost, net of accumulated amortization.

Amortization is calculated by the straight-line method, based on the estimated useful lives of the assets as 3 - 10 years.

3.6 Long-term lease a) Operating lease Lease in which substantially all the risks and rewards of ownership of assets remain with the lessor are accounted for as operating lease. Rentals applicable to such operating leases are charged to the statement of income over the lease term. b) Finance lease Finance lease are the leases in which substantially all the risks and rewards of ownership other than legal title are transferred to the Company. At inception, the fair value of the leased assets is recorded together with the obligations after netting deferred interest. The leased assets are depreciated using the straight-line method over their estimated useful lives. Interest, finance charge, or depreciation are recognized in the statement of income.

3.7 Foreign currency transactions Transactions denominated in foreign currencies incurred during the year are translated into Baht at the rates of exchange prevailing at the transaction dates. All balances of monetary assets and liabilities denominated in foreign currencies at the balance sheet date are translated into Baht at the exchange rates announced by the Bank of Thailand at that date. Gains or losses on foreign exchange arising on settlements and translation are recognized as income or expense in the statement of income as incurred.

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Attachment III Report of the Independent Certified Public Accountants and Financial Statements

3.8 Provident fund The Company has a provident fund for those employees who have indicated their willingness to join. The contributions from the employees are deducted from their monthly salaries, with the Company matching the individuals’ contributions. The provident fund is managed by a financial institution which is authorized by the Government in accordance with the Provident Fund Act B.E. 2530 (1987).

The contribution for employee provident fund is recorded as expenses when incurred.

3.9 Income tax expense Income tax expense, if any, is based on tax paid and accrued for the year.

3.10 Basic earnings (losses) per share Basic earnings (losses) per share are calculated by dividing net income (loss) for the year after cash dividend or dividend which has been declared for preferred shares, by the weighted average number of ordinary shares outstanding during the year.

3.11 Key sources of estimation uncertainty The preparation of financial statements in conformity with generally accepted accounting principles also requires the Company’s management to exercise judgments in order to determine the accounting policies, estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reporting period. Although, these estimates are based on management’s reasonable consideration of current events, actual results may differ from these estimates.

4. Supplemental Disclosure of Cash Flow Information and Cash Equivalents 4.1 Cash and cash equivalents consisting of cash in hand and all types of deposits at financial institutions with original maturities of three months or less and excluding deposits at financial institutions used as collateral as at October 31, are as follows: Consolidated Financial Statements 2009 2008 Cash and deposits at financial institutions Cash and deposits at financial institutions - Joint Venture Government bond Bill of exchange

Baht Separate Financial Statements 2009 2008

31,083,358

58,331,004

17,533,706

39,417,100

56,129 60,000,000

767,055 84,920,247 -

50,000,000

84,920,247 -

91,139,487

144,018,306

67,533,706

124,337,347

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

84 83

4.2 Non-cash transactions as at October 31, are as follows: Fixed assets and intangible assets payable Consolidated Financial Statements 2009 2008 Fixed assets and intangible assets payable brought forward Purchases of fixed assets and intangible assets Less Cash payments for purchases of fixed assets and intangible assets Purchases fixed assets by hirepurchasing agreement Fixed assets and intangible assets payable carried forward

Baht Separate Financial Statements 2009 2008

1,924,152 5,582,451

1,278,273 18,380,286

1,261,469 3,159,053

192,200 18,755,706

(7,020,853)

(14,464,407)

(4,418,572)

(14,416,437)

-

(3,270,000)

-

(3,270,000)

485,750

1,924,152

1,950

1,261,469

5. Current Investments Current investments as at October 31, consist of the following: Consolidated Financial Statements 2009 2008 Government bond Bill of exchange

Baht Separate Financial Statements 2009 2008

60,000,000

84,920,247 -

50,000,000

84,920,247 -

60,000,000

84,920,247

50,000,000

84,920,247

6. Trade Accounts Receivable, Net Trade accounts receivable, net as at October 31, are as follows: Consolidated Financial Statements 2009 2008 Trade accounts receivable, net - Related parties (Note 24) - Others

85 84

Baht Separate Financial Statements 2009 2008

7,538,096 95,669,215

13,608,922 184,253,142

4,657,341 83,030,735

17,543,446 171,643,146

103,207,311

197,862,064

87,688,076

189,186,592

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

Analysis of trade accounts receivable, net aging as at October 31, are as follows: Consolidated Financial Statements 2009 2008 Related parties Current Overdue Within 3 months Between 3 and 6 months Between 6 and 12 months Others Current Overdue Within 3 months Between 3 and 6 months Between 6 and 12 months More than 12 months Add Note receivable Less Allowance for doubtful accounts

Baht Separate Financial Statements 2009 2008

3,002,205

11,097,662

1,451,260

11,097,662

3,157,057 175,740 1,203,094

543,127 1,489,349 478,784

1,827,247 175,740 1,203,094

4,477,651 1,489,349 478,784

7,538,096

13,608,922

4,657,341

17,543,446

44,287,610

121,923,904

33,106,385

116,259,080

6,823,327 31,934,944 4,191,535 7,734,467

20,313,410 20,105,178 17,862,480 4,127,908

6,673,848 31,336,804 3,750,522 7,465,844

13,995,761 19,477,655 17,862,480 4,048,170

94,971,883 7,919,414 (7,222,082)

184,332,880 (79,738)

82,333,403 7,919,414 (7,222,082)

171,643,146 -

95,669,215

184,253,142

83,030,735

171,643,146

The Company has not provided an allowance for doubtful accounts for the overdue related party accounts receivable as the management of the Company expects to collect in full from those receivables.

7. Short-term Loan to a Related Party Short-term loan to a related party as at October 31, consists of the following: Consolidated Financial Statements Short-term loan to a related party - Joint Venture

Baht Separate Financial Statements

2009

2008

2009

2008

885,600

885,600

1,476,000

1,476,000

Related party relationship is described in Note 24.

Short-term loan as at October 31, 2009 and 2008 bear interest at 3.75 % per annum.

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

86 85

8. The Gross Amount due from Customers, Net The gross amount due from customers for contract work, net as at October 31, are as follows: Consolidated Financial Statements 2009 2008 Contract costs incurred and profits/losses recognized to date Less Billing and advances from customers Less Allowance for doubtful account

Baht Separate Financial Statements 2009 2008

43,106,378 (300,000) (62,799)

80,425,824 (13,975,167) (3,467,563)

42,309,374 (300,000) -

78,819,765 (13,975,167) (3,467,563)

42,743,579

62,983,094

42,009,374

61,377,035

9. Other Current Assets – Others Other current assets - other as at October 31, are as follows: Consolidated Financial Statements 2009 2008 Withholding tax deducted at source Deferred cost of the rendering of services (Note 24) Other accounts receivable, net Retentions Others

Baht Separate Financial Statements 2009 2008

20,482,038 12,124,015 12,963,505 7,753,283 8,473,838

7,954,705 22,600,830 3,987,510 2,732,630 15,096,740

19,941,647 12,991,931 12,642,794 7,640,000 7,044,852

6,684,773 23,159,091 3,979,510 2,465,837 13,513,963

61,796,679

52,372,415

60,261,224

49,803,174

10. Deposits at Banks used as Collateral As at October 31, 2009 and 2008, a subsidiary has fixed deposits at banks used as collateral against letters of guarantee issued by banks (see Note 30).

87 86

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

Rental of equipment and contractor on the trade exhibition standard booths Graphic banner and inkjet printing design, design and fabrication of exhibition booth for trade exhibition and interiors for museums Trade exhibition and interior design

Business Activity

90.00

10,000,000 4,000,000

6,000,000 2,000,000 5,000,000

2,000,000

400,000

59.99

22.22 20.00 40.00

20.25

40.00

11,000,000

99.99

90.00

400,000

2,000,000

6,000,000 2,000,000 5,000,000

4,000,000

10,000,000

11,000,000

Paid-up Capital 2009 2008

14,074,441

3,757,551

6,210,070 1,317,154 2,789,666

-

-

-

12,263,206

3,378,032

5,721,083 1,060,531 2,103,560

-

-

-

Equity Method 2009 2008

160,000 32,051,047

-

3,922,033 399,900 1,999,800

2,520,000

10,298,600

12,750,714

2009

160,000 32,051,047

-

3,922,033 399,900 1,999,800

2,520,000

10,298,600

12,750,714

Cost Method 2008

Baht Separate Financial Statements

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

99.99 Multi Designs Company Limited 59.99 Associated companies - Direct Inkjet Images Design and printing of advertising (Thailand) Company banner Limited 22.22 Designlab MISC Co., Ltd Design 20.00 Ibrix Company Limited Trade exhibition and interior design 40.00 Associated company - Indirect U-Rent Company Furniture and equipment rental Limited 20.25 Joint Venture Joint Venture Interiors and construction for museum 40.00 Investments in subsidiaries, associated companies and joint venture, net

Nox Bangkok Company Limited

Subsidiaries PX System Company Limited

Company Name

Portion of Investments % 2009 2008

Consolidated Financial Statements

Investments in associated companies using the equity method for the consolidated financial statements and investments in subsidiaries, associated companies and Joint Venture using cost method for the separate financial statements as at October 31, are as follows:

11. Investments in Subsidiaries, Associated Companies and Joint Venture, Net

8887

12. Property, Plant and Equipment, Net Property, plant and equipment, net consist of the following:

Cost and appraisal value: Land - at cost Land appraisal increase Land improvement Buildings & improvement Vehicles Office equipments Computers Tools & machineries Office furniture Operating equipments Total cost and appraisal value Accumulated depreciation: Land improvement Buildings & improvement Vehicles Office equipments Computers Tools & machineries Office furniture Operating equipments Total accumulated depreciation Assets under construction Property, plant and equipment, net

Balance as at October 31, 2008

Additions

15,782,621 27,917,379 445,025 56,141,998 15,000,336 8,570,604 12,831,160 2,880,260 9,256,008 19,293,291

34,050 272,159 932,104 259,945 1,635,493

(2,600,000) (40,856) (1,209,104) (19,097) -

168,118,682

3,133,751

(3,869,057)

- 167,383,376

(445,024) (21,928,150) (6,985,814) (3,792,628) (8,168,056) (2,854,915) (3,978,950) (12,122,503)

(4,866,482) (2,641,375) (1,581,877) (2,957,233) (11,800) (1,671,454) (3,147,755)

2,121,315 31,395 1,086,099 18,380 -

(445,024) - (26,794,632) - (7,505,874) (62,061) (5,405,171) 62,061 (9,977,129) - (2,866,715) - (5,632,024) - (15,270,258)

(60,276,040) (16,877,976)

3,257,189

- (73,896,827)

985,000

62,065 (62,065) -

15,782,621 27,917,379 445,025 56,176,048 12,400,336 8,863,972 12,492,095 2,880,260 9,496,856 20,928,784

225,000

-

-

1,210,000

108,827,642 (13,519,225)

(611,868)

-

94,696,549

Depreciation for the years: 2009 2008 Cost of fully depreciated fixed assets still in use 2009 Gross carrying amount 2008 Gross carrying amount

89 88

Baht Consolidated Financial Statements Balance as at Transfer October in (out) 31, 2009 Disposals

16,877,976 16,720,166 15,398,363 9,844,193

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

Property, plant and equipment, net (continues) Baht Consolidated Financial Statements Balance as at Transfer October Disposals in (out) 31, 2008

Balance as at October 31, 2007

Additions

Cost and appraisal value: Land - at cost Land appraisal increase Land improvement Buildings & improvement

15,782,621 27,917,379 445,025 50,063,335

978,100

-

5,100,563

15,782,621 27,917,379 445,025 56,141,998

Vehicles Office equipments Computers Tools & machineries Office furniture Operating equipments

15,470,713 7,172,991 13,341,787 11,771,011 8,062,844 18,367,098

3,299,000 1,769,182 2,152,183 16,500 1,403,082 926,193

(3,769,377) (585,858) (3,068,210) (8,236,451) (522,129) -

214,289 405,400 (670,800) 312,211 -

15,000,336 8,570,604 12,831,160 2,880,260 9,256,008 19,293,291

Total cost and appraisal value Accumulated depreciation: Land improvement Buildings & improvement Vehicles Office equipments Computers Tools & machineries Office furniture Operating equipments Total accumulated depreciation Assets under construction Property, plant and equipment, net

168,394,804

10,544,240 (16,182,025)

5,361,663 168,118,682

(445,024) (17,522,111) (7,773,959) (2,773,636) (7,638,565) (10,748,291) (2,994,102) (8,808,937)

(4,406,039) (2,782,952) (1,413,661) (3,151,917) (225,404) (1,426,627) (3,313,566)

3,571,097 394,669 2,971,617 7,648,715 441,779 -

(445,024) - (21,928,150) - (6,985,814) - (3,792,628 (349,191) (8,168,056) 470,065 (2,854,915) - (3,978,950) - (12,122,503)

(58,704,625) (16,720,166)

15,027,877

108,000 109,798,179

Depreciation for the years: 2008 2007 Cost of fully depreciated fixed assets still in use 2008 Gross carrying amount 2007 Gross carrying amount

6,504,063

-

328,137 (1,154,148)

120,874 (60,276,040) (5,627,063)

985,000

(144,526) 108,827,642 16,720,166 16,438,786 9,844,193 16,410,350

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

90 89

Property, plant and equipment, net (continues)

Cost and appraisal value: Land - at cost Land appraisal increase Land improvement Buildings & improvement Vehicles Office equipments Computers Tools & machineries Office furniture Operating equipments Total cost and appraisal value Accumulated depreciation: Land improvement Buildings & improvement Vehicles Office equipments Computers Tools & machineries Office furniture Operating equipments Total accumulated depreciation Assets under construction Property, plant and equipment, net

Balance as at October 31, 2008

Additions

15,782,621 27,917,379 445,025 52,467,527 14,801,336 6,057,425 9,257,264 79,289 8,627,493 1,318,545

34,050 159,406 811,863 259,944 -

(2,600,000) (16,500) (763,065) (19,097) -

-

136,753,904

1,265,263

(3,398,662)

- 134,620,505

(445,024) (20,512,929) (6,786,815) (2,505,209) (5,357,010) (61,602) (3,461,329) (1,287,848)

(4,320,332) (2,641,375) (1,173,529) (2,564,015) (5,103) (1,633,089) (20,297)

2,121,315 7,152 645,796 18,380 -

(445,024) - (24,833,261) - (7,306,875) - (3,671,586) - (7,275,229) (66,705) - (5,076,038) - (1,308,145)

(40,417,766) (12,357,740)

2,792,643

- (49,982,863)

985,000

225,000

-

97,321,138 (10,867,477)

(606,019)

Depreciation for the years: 2009 2008 Cost of fully depreciated fixed assets still in use 2009 Gross carrying amount 2008 Gross carrying amount

91 90

Baht Separate Financial Statements Balance as at Transfer October Disposals in (out) 31, 2009

-

15,782,621 27,917,379 445,025 52,501,577 12,201,336 6,200,331 9,306,062 79,289 8,868,340 1,318,545

1,210,000

- 85,847,642 12,357,740 11,527,366 7,995,497 6,164,020

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

Property, plant and equipment, net (continues)

Cost and appraisal value: Land - at cost Land appraisal increase Land improvement Buildings & improvement Vehicles Office equipments Computers Tools & machineries Office furniture Operating equipments Total cost and appraisal value Accumulated depreciation: Land improvement Buildings & improvement Vehicles Office equipments Computers Tools & machineries Office furniture Operating equipments Total accumulated depreciation Assets under construction Property, plant and equipment, net

Baht Separate Financial Statements Balance as at Transfer October Disposals in (out) 31, 2008

Balance as at October 31, 2007

Additions

15,782,621 27,917,379 445,025 45,428,326 15,271,713 4,398,326 10,040,741 97,880 6,798,004 1,291,345

1,938,638 3,299,000 1,764,383 1,892,427 17,057 1,980,507 27,200

(3,769,377) (319,573) (2,675,904) (35,648) (463,229) -

5,100,563 214,289 312,211 -

127,471,360

10,919,212

(7,263,731)

5,627,063 136,753,904

(445,024) (16,755,347) (7,574,960) (1,697,392) (5,279,909) (86,395) (2,544,131) (1,252,434)

(3,757,582) (2,782,952) (968,998) (2,657,966) (8,436) (1,316,018) (35,414)

3,571,097 161,181 2,580,865 33,229 398,820 -

(445,024) - (20,512,929) - (6,786,815) - (2,505,209) - (5,357,010) (61,602) - (3,461,329) - (1,287,848)

(35,635,592) (11,527,366)

6,745,192

- (40,417,766)

108,000

6,504,063

-

91,943,768

5,895,909

(518,539)

Depreciation for the years: 2008 2007 Cost of fully depreciated fixed assets still in use 2008 Gross carrying amount 2007 Gross carrying amount

(5,627,063)

15,782,621 27,917,379 445,025 52,467,527 14,801,336 6,057,425 9,257,264 79,289 8,627,493 1,318,545

985,000

- 97,321,138 11,527,366 10,197,072 6,164,020 4,933,028

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

92 91

During the year ended October 31, 1994, land was professionally appraised and the revaluation account is shown in land revaluation surplus under shareholders’ equity.

The land was re-appraised by the independent appraiser on July 31, 2000 and the decline in value of Baht 5.3 million was deducted from such revaluation surplus.

On August 9, 2005, such land was re-appraised by the independent appraiser and surplus in value of Baht 18.7 million was included in such revaluation surplus.

13. Intangible Assets, Net Intangible assets, net consist of the following:

Cost Computer software Total Accumulated amortization Computer software Total accumulated amortization Intangible assets pending transfer Intangible assets, net Amortization for the years 2009 2008

93 92

Baht Consolidated Financial Statements Balance as at Transfer October Disposals in (out) 31, 2009

Balance as at October 31, 2008

Additions

5,657,833

2,223,700

-

-

7,881,533

5,657,833

2,223,700

-

-

7,881,533

(1,426,377)

(783,873)

-

- (2,210,250)

(1,426,377)

(783,873)

-

- (2,210,250)

209,802

-

(209,802)

-

-

4,441,258

1,439,827

(209,802)

-

5,671,283 783,873 575,019

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

Intangible assets, net (continues)

Cost Computer software Total Accumulated amortization Computer software

Baht Consolidated Financial Statements Balance as at Transfer October Disposals in (out) 31, 2008

Balance as at October 31, 2007

Additions

4,220,450

119,893

(160,000)

1,477,490

5,657,833

4,220,450

119,893

(160,000)

1,477,490

5,657,833

(801,894)

(575,019)

71,410

(120,874)

(1,426,377)

Total accumulated amortization

(801,894)

(575,019)

71,410

Intangible assets pending transfer

209,802

1,212,090

-

3,628,358

756,964

Intangible assets, net

(88,590)

(120,874)

(1,426,377)

(1,212,090)

209,802

144,526

4,441,258

Amortization for the years 2008 2007

Cost Computer software Total Accumulated amortization Computer software Total accumulated amortization Intangible assets pending transfer Intangible assets, net Amortization for the years 2009 2008

575,019 390,271 Baht Separate Financial Statements Balance as at Transfer October Disposals in (out) 31, 2009

Balance as at October 31, 2008

Additions

5,266,989

1,668,790

-

-

6,935,779

5,266,989

1,668,790

-

-

6,935,779

(1,238,161)

(676,006)

-

-

(1,914,167)

(1,238,161)

(676,006)

-

-

(1,914,167)

(209,802)

-

-

(209,802)

-

5,021,612

209,802 4,238,630

992,784

676,006 527,329

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

94 93

Intangible assets, net (continues) Baht Separate Financial Statements Balance as at Transfer October Disposals in (out) 31, 2008

Balance as at October 31, 2007

Additions

3,934,558

120,341

-

1,212,090

5,266,989

3,934,558

120,341

-

1,212,090

5,266,989

(710,832)

(527,329)

-

-

(1,238,161)

Total accumulated amortization

(710,832)

(527,329)

-

-

(1,238,161)

Intangible assets pending transfer

209,802

1,212,090

-

(1,212,090)

209,802

3,433,528

805,102

-

-

4,238,630

Cost Computer software Total Accumulated amortization Computer software

Intangible assets, net Amortization for the years 2008 2007

527,329 345,682

14. Bank Overdraft and Short-Term Loan from Financial Institutions The Company and subsidiaries have unused credit facilities for bank overdraft and short-term loan as at October 31, as follows:

2009 2008

Consolidated Financial Statements

Million Baht Separate Financial Statements

202.34 195.37

190.00 190.00

As at October 31, 2009 and 2008, such credit facilities have interest rates at minimum overdraft rate (MOR) plus 0.00% - 0.50% per annum and at minimum lender rate (MLR) less 0.00% - 2.75% per annum.

As at October 31, 2009 and 2008, the Company has agreements to guarantee loans of subsidiaries under overdrafts facilities from local banks totaling Baht 13 million.

95 94

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

15. Trade Accounts Payable Trade accounts payable as at October 31, are as follows: Consolidated Financial Statements 2009 2008 Trade accounts payable - Related parties (Note 24) - Others Accrued cost - Related parties (Note 24) - Others

Baht Separate Financial Statements 2009 2008

5,293,873 36,251,956

10,064,364 81,268,919

7,296,147 28,334,910

17,559,158 75,408,000

1,631,623 29,450,232

1,881,838 37,604,985

1,931,974 23,473,459

2,824,416 35,541,115

72,627,684

130,820,106

61,036,490

131,332,689

16. The Gross Amount due to Customers for Contract Work The gross amount due to customers for contract work as at October 31, are as follows: Consolidated Financial Statements 2009 2008 Billing and advances from customers Less Contract costs incurred and profits/losses recognized to date

Baht Separate Financial Statements 2009 2008

5,569,030

32,619,925

5,569,030

31,636,985

(2,024,298)

(20,539,234)

(2,024,298)

(20,397,420)

3,544,732

12,080,691

3,544,732

11,239,565

17. Obligations under Hire-Purchase Agreements Obligations under hire-purchase agreements as at October 31, are as follows: Baht Consolidated Financial Statements 2009 2008 Obligations under hire-purchase agreements Less Deferred interest Less Obligations under hire-purchase agreements due within one year

Separate Financial Statements 2009 2008

3,937,416 (265,513)

7,911,008 (824,883)

3,937,416 (265,513)

7,911,008 (824,883)

3,671,903

7,086,125

3,671,903

7,086,125

(2,112,235)

(2,927,877)

(2,112,235)

(2,927,877)

1,559,668

4,158,248

1,559,668

4,158,248

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

96 95

18. Share Capital The Company’s registered share capital comprised ordinary shares and preferred shares.

The preferred shares have the right to receive dividends equal to ordinary shares. The dividend will be calculated from profit earned after the issuance of preferred shares.

However, any profit on the appraisal of land, buildings and other assets which existed before the issuance of the preferred shares, will be allocated solely to the ordinary shares.

The preferred shareholders have the right to vote in the shareholder meeting, a ten thousand preferred shares are equivalent to one voting right of a ordinary share. The preferred shares have the right to receive the proportion of their return on investments upon liquidation equal to ordinary shares.

As at October 31, 2009 and 2008, the premium on ordinary share capital included in the consolidated and separate financial statements, are as follows:

Premium on ordinary share capital Less Underwriting fee

2009

Baht 2008

105,000,000 (3,750,000)

105,000,000 (3,750,000)

101,250,000

101,250,000

19. Legal Reserve Under the Public Companies Limited Act, the Company is required to set aside as a legal reserve at least 5% of its net income after deficit brought forward (if any) until the reserve is not less than 10% of the registered capital. Such reserve fund is not available for distribution as dividend until the Company is finally wound up.

20. Capital Risk Management The Company’s objectives in managing capital are to safeguard the Company’s ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders.

97 96

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

21. Dividends Paid 21.1 The Company On December 12, 2008, the Company’s Board of Directors’ meeting resolved to take action for an interim dividend payment of Baht 0.18 per share for the total eligible shares of 114,999,980 shares totaling Baht 20.70 million to the shareholders whose names were listed in the Company’s registrar book as at December 29, 2008. The Company paid such dividend on January 9, 2009.

On June 6, 2008, the Company’s Board of Directors’ meeting resolved to take action for an interim dividend payment of Baht 0.20 per share for the total eligible shares of 114,999,980 shares totaling Baht 23 million to the shareholders whose names were listed in the Company’s registrar book as at June 23, 2008. The Company paid such dividend on July 4, 2008.

On February 15, 2008, the Company’s annual ordinary shareholders’ meeting resolved to take action for the appropriation of legal reserve of Baht 0.79 million, appropriation of dividend payment of Baht 0.20 per share from the net profit of 2007 to the shareholders whose names were listed in the Company’s registrar book as at January 29, 2008 totaling Baht 23 million. The Company paid such dividend on February 29, 2008.

21.2 The subsidiaries On September 30, 2008, the Board of Directors’ meeting of PX System Company Limited passed a resolution for an interim dividend payment of Baht 40 per share for 110,000 ordinary shares totaling Baht 4.40 million.

On September 1, 2008, the Board of Directors’ meeting of Multi Designs Company Limited passed a resolution for an interim dividend payment of Baht 50 per share for 40,000 ordinary shares totaling Baht 2 million.

On January 31, 2008, the Board of Directors’ meeting of PX System Company Limited passed a resolution for an interim dividend payment of Baht 30 per share for 110,000 ordinary shares totaling Baht 3.30 million.

On January 17, 2008, the Board of Directors’ meeting of Multi Designs Company Limited passed a resolution for an interim dividend payment of Baht 30 per share for 40,000 ordinary shares totaling Baht 1.20 million.

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

98 97

22. Basic Earnings (Losses) per Share The calculation of the basic earnings (losses) per share for the years ended October 31, are based on the following data: Consolidated Financial Statements 2009 2008

Baht Separate Financial Statements 2009 2008

Net income (loss) Less Dividends of preferred shares

(29,877,051) (59,400)

64,483,589 (132,000)

(35,619,846) (59,400)

67,350,509 (132,000)

Net income (loss) for the calculation purpose of basic earnings (losses) per share

(29,936,451)

64,351,589

(35,679,246)

67,218,509

Weightedaveragenumberofordinaryshares Shares

114,669,980

114,669,980

114,669,980

114,669,980

Baht

(0.26)

0.56

(0.31)

0.59

Basic earnings (losses) per share

23. Expenses by Nature Expenses by nature for the years ended October 31, has been arrived at after charging the following items: Consolidated Financial Statements Cost of the rendering of services Staff expenses Depreciation and amortization Directors’ remuneration Other expenses

99 98

Baht Separate Financial Statements

2009

2008

2009

2008

455,298,352 82,852,598 17,661,849 1,740,000 58,244,286

748,195,849 106,833,178 17,295,185 5,000,000 60,037,992

409,901,909 71,315,371 13,033,746 1,740,000 49,572,428

709,572,031 91,931,685 12,054,695 5,000,000 51,147,572

615,797,085

937,362,204

545,563,454

869,705,983

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

24. Related Parties Transactions The financial statements included certain transactions with related parties. These parties are related through common shareholdings and/or directorship. The financial statements reflect the effects of these transactions on the basis determined by the companies concerned.

Significant balances with the related parties as at October 31, are as follows:

Accounts/Companies

Relationship

Trade Accounts Receivable (Note 6) Pico Art International Pte Ltd. Major Shareholder Indec International Pte Ltd. Same Ultimate Holding Company Pico Australia Pty Ltd. Same Ultimate Holding Company Pico International (M) Sdn Bhd Same Ultimate Holding Company Pico International Ltd. Same Ultimate Holding Company Shanghai Pico Exhibition Services Co., Ltd. Same Ultimate Holding Company Pico International (France) Ltd. Same Ultimate Holding Company Pico IES Group Limited Pico International (B) Sdn Bhd Pico International (UK) Ltd. Pico International (HK) Ltd. Pico Event Marketing (INDIA) Pvt. Ltd. World Image International PX System Company Limited Multi Designs Company Limited

Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Subsidiary Subsidiary

Baht Consolidated Separate Financial StatementFinancial Statements 2009 2008 2009 2008 2,177,313 3,886,601 1,346,850 3,886,601 92,300 - 92,300 352,900 352,900 124,384 - 124,384 325,007 6,870,024 - 6,870,024 264,306 - 264,306 753,520 753,520 1,576,378 1,310,215 1,576,378 1,310,215 26,750 73,900 965,700 73,900 965,700 1,903,995 178,710 321,000 321,000 54,083 68,642 54,083 68,642 - 25,680 - 3,935,594 7,538,096 13,608,922 4,657,341 17,543,446

Amounts due from related parties Pico Art International Pte Ltd. Pico Global Services Limited Pico Contracts Limited PX System Company Limited Multi Designs Company Limited Inkjet Images (Thailand) Company Limited

Major Shareholder Same Ultimate Holding Company Same Ultimate Holding Company Subsidiary Subsidiary Associated Company

Short-term loan to a related party Joint Venture Joint Venture

204,004 841 34,942

55,108 6,741 34,726

204,004 55,108 841 6,741 123,125 34,668 181,301 384,821 34,942 34,726

239,787

96,575

544,213 516,064

885,600

885,600 1,476,000 1,476,000

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

100 99

Baht Consolidated Separate Financial Statement Financial Statement Accounts/Companies

Relationship

The gross amount due from customers for contract work Pico International (UK) Ltd. Same Ultimate Holding Company Pico International (HK) Ltd. Same Ultimate Holding Company U-Rent Company Limited Associated Company

Deferred cost of the rendering of services Pico Art International Pte Ltd. Major Shareholder Pico Global Services Limited Same Ultimate Holding Company PX System Company Limited Subsidiary Multi Designs Company Limited Subsidiary Designlab MISC Company Limited Associated Company Inkjet Images (Thailand) Company Limited Associated Company U-Rent Company Limited Associated Company

Investments in subsidiaries, associated companies and joint venture, net PX System Company Limited Subsidiary Nox Bangkok Company Limited Subsidiary Multi Designs Company Limited Subsidiary Inkjet Images (Thailand) Company Limited Associated Company Designlab MISC Company Limited Associated Company Ibrix Company Limited Associated Company U-Rent Company Limited Associated Company Joint Venture Joint Venture

2009

2008

2009

2008

137,074 12,650

53,720 -

137,074 -

53,720 -

149,724

53,720

137,074

53,720

11,406 22,297 150,000 42,358 18,550

11,406 11,406 22,297 22,297 25,000 - 1,020,000 150,000 150,000 142,000 42,358 18,550

11,406 22,297 615,500 150,000 142,000 -

244,611

325,703 1,289,611

941,203

6,210,070 1,317,154 2,789,666 3,757,551 -

5,721,083 1,060,531 2,103,560 3,378,032 -

12,750,714 12,750,714 10,298,600 10,298,600 2,520,000 2,520,000 3,922,033 3,922,033 399,900 399,900 1,999,800 1,999,800 160,000 160,000

14,074,441 12,263,206 32,051,047 32,051,047 Trade accounts payable (Note 15) Pico Art International Pte Ltd. Major Shareholder Pico IES Group (China) Co., Ltd. Same Ultimate Holding Company Pico International (HK) Ltd. Same Ultimate Holding Company Pico Global Services Limited Same Ultimate Holding Company Pico International (M) Sdn Bhd Same Ultimate Holding Company Shanghai Pico Exhibition Services Co., Ltd. Same Ultimate Holding Company PX System Company Limited Subsidiary Multi Designs Company Limited Subsidiary U-Rent Company Limited Associated Company Inkjet Images (Thailand) Company Limited Associated Company Designlab MISC Company Limited Associated Company

1,087,303 61,823 2,974,037 1,170,710 -

1,643,436 11,410 27,105 912,193 581,965 3,607,521 1,664,981 1,615,753

1,087,303 61,823 1,327,688 2,129,300 1,519,323 1,170,710 -

1,643,436 11,410 27,105 912,193 581,965 5,508,077 2,174,775 3,419,463 1,664,981 1,615,753

5,293,873 10,064,364 7,296,147 17,559,158

III 101 Attachment 100 Report of the Independent Certified Public Accountants and Financial Statements

Baht Consolidated Separate Financial Statement Financial Statement Accounts/Companies

Relationship

Accrued cost (Note 15) Pico Art International Pte Ltd. Pico International (HK) Ltd. PX System Company Limited Multi Designs Company Limited U-Rent Company Limited Inkjet Images (Thailand) Company Limited

Major Shareholder Same Ultimate Holding Company Subsidiary Subsidiary Associated Company Associated Company

2009

2008

658,570 50,000 340,559 271,352 632,494 1,560,486

2009

2008

658,570 50,000 592,969 - 1,082,500 47,941 131,430 632,494 1,560,486

1,631,623 1,881,838 1,931,974 2,824,416 Amounts due to related parties Pico Art International Pte Ltd. Pico Global Services Limited Pico International (UK) Ltd. Inkjet Images (Thailand) Company Limited

Major Shareholder 12,840,750 21,290,861 12,840,750 21,290,861 Same Ultimate Holding Company 2,921 75,560 2,921 75,560 Same Ultimate Holding Company 460,000 460,000 Associated Company 14,445 14,445 13,303,67121,380,86613,303,67121,380,866

Accrued expenses PX System Company Limited Multi Designs Company Limited

Subsidiary Subsidiary

The gross amount due to customers for contract work Pico Art International Pte Ltd. Major Shareholder Pico Atlanta, Inc. Same Ultimate Holding Company Pico International Ltd. Same Ultimate Holding Company

-

-

10,000 -

50,000

-

-

10,000

50,000

538,318 -

287,269 278,224 166,619

538,318 -

287,269 278,224 166,619

538,318

732,112

538,318

732,112

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

102 101

Significant business transactions with related parties for the years ended October 31, are mainly as follows:

Accounts/Companies

Relationship

Revenues from the rendering of services Pico Art International Pte Ltd. Major Shareholder Pico Art Exhibit, Inc. Pico International Taiwan Ltd. Pico International Ltd. Pico International (M) Sdn Bhd Pico International (China) Limited Pico International (Dubai) L.L.C. Pico International (UK) Ltd. Indec International Pte Ltd. Pico IES Group Limited Shanghai Pico Exhibition Services Co., Ltd. World Image International Pico International (B) Sdn Bhd Pico Australia Pty Ltd. Pico International (HK) Ltd. Pico International (France) Ltd. Pico North Asia Ltd. Pico Event Management (INDIA) Pvt. Ltd. Pico Atlanta, Inc. PX System Company Limited Nox Bangkok Company Limited Multi Designs Company Limited U-Rent Company Limited

Baht Consolidated Separate Financial Statement Financial Statement 2009 2008 2009 2008

Same Ultimate Holding Company

2,177,596 3,621,440 1,258,738 3,621,440 136,449 136,449 -

Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Subsidiary Subsidiary Subsidiary Associated Company

437,770 437,770 961,495 11,753,942 331,050 8,009,418 583,960 6,339,129 477,150 6,108,182 54,368 54,368 - 2,606,735 - 2,606,735 455,981 3,871,741 455,981 3,871,741 (9,346) 86,262 (9,346) 86,262 1,473,250 1,803,601 1,473,250 1,224,500 247,015 247,015 51,007 64,151 51,007 64,151 25,000 720,280 398,878 720,280 398,878 4,737,437 79,370 304,093 704,224 704,224 - 2,171,963 - 2,171,963 300,000 300,000 438,785 293,570 438,785 293,570 95,000 69,000 - 1,010,000 95,000 3,678,125 291,320 508,114 13,022,43834,363,049 7,841,66132,943,118

Dividend income PX System Company Limited Subsidiary Multi Designs Company Limited Subsidiary Inkjet Images (Thailand) Company Limited Associated Company

Management fee (income) PX System Company Limited Nox Bangkok Company Limited Multi Designs Company Limited

Subsidiary Subsidiary Subsidiary

-

-

- 6,929,650 - 1,919,680 200,000 599,999

-

-

200,000 9,449,329

-

-

388,800 338,400

388,800 54,600 338,400

-

-

727,200

781,800

III 103 Attachment 102 Report of the Independent Certified Public Accountants and Financial Statements

Baht Consolidated Separate Financial Statement Financial Statement Accounts/Companies

Relationship

Other income Nox Bangkok Company Limited Subsidiary Multi Designs Company Limited Subsidiary Inkjet Images (Thailand) Company Limited Associated Company

Selling of fixed assets U-Rent Company Limited Associated Company Inkjet Images (Thailand) Company Limited Associated Company

Costs of the rendering of services Pico Art International Pte Ltd. Pico International (M) Sdn Bhd Pico Hanoi Ltd. Pico International (Dubai) L.L.C. Pico International (China) Limited Pico International (Egypt) Ltd. Pico Australia Pty Ltd. Pico International (HK) Ltd. Pico International Taiwan Ltd. Intertrade Services Pte Ltd. Pico IES Group (China) Co., Ltd. Shanghai Pico Exhibition Services Co., Ltd. Pico Global Services Limited Pico Chicago, Inc. Pico International (Bahrain) S.P.L. PX System Company Limited Nox Bangkok Company Limited Multi Designs Company Limited U-Rent Company Limited Inkjet Images (Thailand) Company Limited Designlab MISC Company Limited Ibrix Company Limited

Major Shareholder Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Same Ultimate Holding Company Subsidiary Subsidiary Subsidiary Associated Company Associated Company Associated Company Associated Company

2009

2008

2009

2008

113,400

71,820

507,600 113,400

117,000 453,600 71,820

113,400

71,820

621,000

642,420

-

1,000 749,258

-

1,000 6,596

-

750,258

-

7,596

1,727,126 1,692,107 1,727,126 1,692,107 - 1,695,915 - 1,695,915 207,671 207,671 425,256 425,256 7,349 7,349 381,940 381,940 - 1,572,899 - 1,572,899 120,088 312,732 120,088 312,732 321,985 209,200 321,985 209,200 310,540 310,540 10,359 10,359 511,610 511,610 4,389 4,389 263,257 263,257 981,188 981,188 - 10,824,136 12,383,186 - 2,356,067 - 5,366,500 7,171,500 6,922,981 8,674,544 4,364,073 6,989,553 6,645,826 4,612,387 6,180,337 4,612,387 3,432,100 14,691,340 3,432,100 14,691,340 800,000 800,000 21,261,83435,272,95534,428,07355,498,717

Directors’ remuneration

Director

1,740,000 5,000,000 1,740,000 5,000,000

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

104 103

Baht Consolidated Separate Financial Statement Financial Statement Accounts/Companies

Relationship

2009

2008

2009

2008

Management fee (expense) Pico Art International Pte Ltd.

Major Shareholder

12,058,875 20,189,251 12,058,875 20,189,251

Dividend paid Pico Art International Pte Ltd. Directors

Major Shareholder Director

8,280,018 18,400,040 8,280,018 18,400,040 5,543,698 12,514,197 5,543,698 12,514,197 13,823,71630,914,23713,823,71630,914,237

Other expenses Pico Art International Pte Ltd. Pico International (M) Sdn Bhd Pico Global Services Limited PX System Company Limited Nox Bangkok Company Limited Multi Designs Company Limited U-Rent Company Limited Inkjet Images (Thailand) Company Limited

Major Shareholder Same Ultimate Holding Company Same Ultimate Holding Company Subsidiary Subsidiary Subsidiary Associated Company Associated Company

77,352 55,057 132,409

Purchase of fixed assets Nox Bangkok Company Limited

Subsidiary

80,476 369,205 281,631 12,500 32,408

776,220 1,191,409 1,833,175

-

-

-

Service income and cost of service are determined by the Company and its related companies based on the cost plus basis as the condition in the normal course of business.

-

On November 1, 2001, the Company entered into the Management Consultant Agreements with three subsidiaries. The management fees charged to such subsidiaries are presented as follows: Companies

Monthly fee (Baht)

PX System Company Limited Nox Bangkok Company Limited Multi Designs Company Limited

32,400 18,200 28,200

80,476 369,205 77,352 281,631 74,000 17,455 985,000 1,039,500 12,500 55,057 32,408

Such agreements shall be in effect for a year from the date of the agreement and the two parties can renew the agreements for a successive term of 1 year. In 2004, the Company has renewed and extended such Management Consultant Agreements for 3 years.

On November 1, 2006, the Company entered into the new Management Consultant Agreements with three subsidiaries. The management fees charged to such subsidiaries are the same amount. The new agreements shall be in effect for 3 years from the date of the agreement and the two parties can renew the agreement for a successive term of 3 years.

III 105 Attachment 104 Report of the Independent Certified Public Accountants and Financial Statements

- 2,250,506

In February 2008, the Company cancelled the management fees and rental charges with a subsidiary because the subsidiary was under an organization restructuring plan in order to accommodate the operation in the future.

-

On July 10, 1992, the Company entered into the Off-shore Services agreement and Intellectual Property License agreement with Pico Art International Pte Ltd., a major shareholder. Subsequently, amendments of both agreements have been made on November 3, 2003. In consideration thereof, the Company is committed to pay fees under the new amendments at the agreed rates of the gross revenues.

Both agreements shall continue for an indefinite period until terminated by the mutual agreement of the parties.

25. Share of Profits from Investments using the Equity Method For the years ended October 31, 2009 and 2008, share of profits from investment using the equity method included in the consolidated financial statements are based on the net income of the financial statements of associated companies for the years ended October 31, 2009 and 2008. Such share of profits can be stated as percentages of the Company’s consolidated net income (losses) as follows: % of Ownership 2009 2008

Companies Consolidated Associated companies - Direct Inkjet Images (Thailand) Company Limited Designlab MISC Company Limited Ibrix Company Limited Associated company - Indirect U-Rent Company Limited

% of Net Income (Loss) 2009 2008

22.22 20.00 40.00

22.22 20.00 40.00

(2.31) (0.86) (2.30)

1.79 0.10 0.37

20.25

20.25

(3.23)

1.39

For the years ended October 31, 2009 and 2008, share of profits from investments using the equity method of associated companies were computed from the financial statements for the years ended October 31, 2009 and 2008, which had not been audited.

26. Provident Fund For the years ended October 31, 2009 and 2008, the Company and subsidiaries’ contributions included in services and administrative expenses in the consolidated and separate financial statements were as follows:

2009 2008

Consolidated Financial Statements

Baht Separate Financial Statements

2,773,170 2,444,397

2,327,403 2,070,414

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

106 105

27. Disclosure of Financial Instruments The Company and subsidiaries present and disclose financial instruments as follows: 27.1 Accounting Policies

Details of significant accounting policies are disclosed in Note 3.

27.2 Credit Risk

Credit risk refers to the risk that counterparty will default on its contractual obligations resulting in a financial loss to the Company and subsidiaries. Concentrations of credit risk with respect to trade receivable are limited because the customers of the Company and subsidiaries are diversified.

In the case of recognized financial assets in the balance sheet, the carrying amount of the assets recorded in the balance sheet represents the Company’s maximum exposure to credit risk.

27.3 Foreign Exchange Risk

Foreign exchange risk arises from the change in foreign currency exchange rate to have an adverse effect on the Company and subsidiaries in the current reporting year and in future years. The Company and subsidiaries do not expect to incur material effects of foreign currency exchange rate on its financial position and results of the operations because the majority of business activities are denominated in Thai Baht.

27.4 Interest Rate Risk

Interest rate risk arises from the potential for a change in interest rate to have an adverse effect on the Company and subsidiaries in the current reporting period and in future years. The Company and subsidiaries do not expect to incur material incremental effect on its interest expense since the Company has no outstanding loan balance and a subsidiary has short-term loan balance in a form of bank overdraft.

27.5 Estimated Fair Value of Financial Instruments

Thai Accounting Standard No. 32, “Financial Instruments: Presentation� (previously TAS 48) requires certain fair value disclosures. Considerable judgment is necessarily required in estimation of fair value. Accordingly, the estimated fair value presented herein is not necessarily indicative of the amount that could be realized in a current marker exchange. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value. The following methods and assumptions were used by the Company and subsidiaries in estimating fair values of financial assets and financial liabilities.

III 107 Attachment 106 Report of the Independent Certified Public Accountants and Financial Statements

Cash and cash equivalents, current investments, accounts receivable, amounts due from related companies, short-term loan to a related party, other current assets, bank overdrafts and short-term loan from financial institutions, short-term loan from related parties, trade accounts payable, amounts due to related companies and other current liabilities: the carrying values approximate their fair values due to the relatively short period to maturity.

The current net assets value of non-listed securities based on the latest available financial statements of those companies approximate fair values.

As at October 31, 2009 and 2008, the carrying values of the financial assets and liabilities which is different from the fair values are as follows: Consolidated Financial Statement Carrying Value Fair Value 2009 2008 2009 2008 Obligation under hirepurchase agreements

Baht Separate Financial Statement Carrying Value Fair Value 2009 2008 2009 2008

3,671,903 7,086,125 3,701,661 6,629,029 3,671,903 7,086,125 3,701,661 6,629,009

Fair value is estimated using the available each year’s market rates which are approximately 2.85% - 3.75% per annum for the year ended October 31, 2009 and approximately 3.90% - 4.25% per annum for the year ended October 31, 2008.

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

108 107

28. Business Segment Information Business segment information for the Company and subsidiaries are presented as follows: Consolidated Financial Statements For the year ended October 31, 2009 being as follows: Baht Revenue Type Revenues from the rendering of services Dividend income Other income Other income - Joint Venture Share of profits from investments using the equity method Total Revenues

Event Exhibition Marketing

Museum Exhibit

312,916,434 -

55,956,116 -

87,952,866 -

-

-

-

312,916,434

87,952,866

55,956,116

Inkjet & Graphic

Organizer

Others

Total

- 20,798,233 105,813,259 583,436,908 562,030 562,030 2,841,509 2,841,509 54,796 54,796

-

-

2,596,235 2,596,235

- 20,798,233 111,867,829 589,491,478

Loss before income tax Less Income tax

(26,840,910) (2,222,449) (29,063,359)

Less Minority interest in consolidated net loss

(813,692)

Net loss

(29,877,051)

Inter-segment fixed assets General fixed assets Total fixed assets Less Accumulated depreciation

21,195,096

-

-

-

-

Fixed assets, net

- 21,195,096 147,398,280 168,593,376 (73,896,827) 94,696,549

General assets

325,689,922

Total Assets

420,386,471

III 109 Attachment 108 Report of the Independent Certified Public Accountants and Financial Statements

Consolidated Financial Statements For the year ended October 31, 2008 being as follows: Baht Revenue Type Revenues from the rendering of services Dividend income Other income Other income - Joint Venture Share of profits from investments using the equity method Total Revenues

Event Exhibition Marketing

Museum Exhibit

Inkjet & Graphic

417,239,548 171,277,183 -

46,667,818 -

402,043 149,721,632 222,887,462 1,008,195,686 304,355 304,355 - 13,283,037 13,283,037 52,120 52,120

-

-

417,239,548 171,277,183

-

46,667,818

-

Organizer

-

Others

Total

2,360,955 2,360,955

402,043 149,721,632 238,887,929 1,024,196,153

Income before income tax Less Income tax Income tax – Joint Venture

86,272,093 (19,980,875) (82,594) 66,208,624

Less Minority interest in consolidated net income

(1,725,035)

Net income

64,483,589

Inter-segment fixed assets General fixed assets Total fixed assets Less Accumulated depreciation

19,635,198

-

-

-

-

-

19,635,198 149,468,484 169,103,682 (60,276,040)

Fixed assets, net

108,827,642

General assets

488,979,295

Total Assets

597,806,937

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

110 109

Separate Financial Statements For the year ended October 31, 2009 being as follows: Baht Revenue Type

Event Exhibition Marketing

Museum Exhibit

Inkjet & Graphic

Revenues from the rendering of services Dividend income Other income

247,219,282 -

78,070,679 -

55,956,116 -

-

20,798,233 104,136,699 506,181,009 200,000 200,000 3,920,394 3,920,394

Total Revenues

247,219,282

78,070,679

55,956,116

-

20,798,233 108,257,093 510,301,403

Organizer

Others

Net loss Inter-segment fixed assets General fixed assets Total fixed assets Less Accumulated depreciation

Total

(35,619,846) -

-

-

-

-

-

Fixed assets, net

135,830,505 135,830,505 (49,982,863) 85,847,642

General assets

296,600,652

Total Assets

382,448,294

Separate Financial Statements For the year ended October 31, 2008 being as follows: Baht Revenue Type

Event Exhibition Marketing

Museum Exhibit

Inkjet & Graphic

Revenues from the rendering of services Dividend income Other income

357,586,359 163,062,217 -

46,667,818 -

- 149,790,631 214,488,169 931,595,194 9,449,329 9,449,329 - 12,897,900 12,897,900

Total Revenues

357,586,359 163,062,217

46,667,818

- 149,790,631 236,835,398 953,942,423

Organizer

Others

Total

Income before income tax Less Income tax

83,763,538 (16,413,029)

Net income

67,350,509

Inter-segment fixed assets General fixed assets Total fixed assets Less Accumulated depreciation

-

-

-

-

-

Fixed assets, net

-

137,738,904 137,738,904 (40,417,766) 97,321,138

General assets

470,501,289

Total Assets

567,822,427

III 111 Attachment 110 Report of the Independent Certified Public Accountants and Financial Statements

30 - 90

30 - 90

30 - 90

Trade accounts receivable

Trade accounts payable

Other payables

Cash and cash equivalents

As at October 31, 2008

30 - 90

Other payables

551

325

95,954

27,017

68,937

1,648

1,600

48

61,762

16,754

45,008

1,153

-

-

1,153

S$

22,598

16,632

5,966

3,333

-

3,333

672

672

-

2,836

197

-

2,639

HK$

89,400

-

89,400

401,198

397,468

3,730

-

-

-

651

-

-

651

RM

-

-

-

834

-

834

-

-

-

-

-

-

-

AUD

-

-

-

202,350

80,094

122,256

-

-

-

5,256

-

-

5,256

Yen

-

-

-

235

-

235

301

-

301

974

-

-

974

Euro

112,992

-

112,992

18,799

-

18,799

-

-

-

17,546

-

-

17,546

Yuan

3,927,412

719,633

3,207,779

9,667,950

9,171,331

496,619

1,571,829

407,663

1,164,166

777,926

841

495,417

281,668

Baht

Consolidated and Separate Financial Statements

Attachment III Report of the Independent Certified Public Accountants and Financial Statements

-

-

551

1,216

160,038 325

-

154,077

1,216

-

1,841 5,961

-

-

-

62

1,841

17,872

30 - 90

Trade accounts payable

-

30 - 90

Other receivable

-

62

GBP

-

2,945 14,927

30 - 90

USD

Trade accounts receivable

Term of Receipt/ Payment (Days)

Cash and cash equivalents

As at October 31, 2009

Assets and Liabilities

Assets and liabilities of the Company and subsidiaries in foreign currencies are as follows:

The Company and subsidiaries do not have a policy to cover foreign exchange exposure of assets and liabilities in foreign currencies because the Company and subsidiaries do not expect to incur material effects of foreign currency exchange rate on its financial position and results of the operations because the majority of business activities are denominated in Thai Baht. All foreign currency transactions have to be approved by management.

29. Risk Management Policies for Assets and Liabilities in Foreign Currencies

112111

30. Guarantees As at October 31, 2009 and 2008, the Company and a subsidiary have bank letters of guarantee as required by the contracts with customers amounting to approximately Baht 33.99 million and Baht 41.02 million, respectively.

31. Corporate Tax According to the Royal Decree No. 475 B.E. 2551 issued under the Revenue Code regarding the corporate income tax rate deduction effective on August 7, 2008, the corporate income tax for companies listed on the Market for Alternative Investment has been reduced from 30% to 20% of net profit which does not exceed Baht 20 million for three consecutive accounting periods beginning on or after January 1, 2008.

Therefore, the Company has used a tax rate of 20% for the corporate income tax calculations for the years ended October 31, 2009 and 2008 to conform to such tax rate change.

32. Significant Agreement 32.1 On August 25, 2004, the Company entered into a Joint Venture Agreement with Ekca Thai Co., Ltd. and Bewcon Co., Ltd. The objective of which is to construct building and design exhibition. The investment portion of Ekca Thai Co., Ltd., Pico (Thailand) Public Company Limited and Bewcon Co., Ltd. is 4 : 4 : 2. The operating income or loss from the Joint Venture will be transferred to each party at such portion.

32.2 As at October 31, 2009 and 2008, the Joint Venture has pledged a letter of guarantee issued by a bank of Baht 12.3 million for performance guarantee and another letter of guarantee of Baht 24.6 million for cash advance received from customer. Such letters are secured by a transfer of the right to receive money on contract work to the bank.

As at October 31, 2009 and 2008, the Joint Venture has pledged bill of exchange of Baht 3.69 million, with the bank.

33. Commitments and Contingent Liabilities 33.1 As at October 31, 2009 and 2008, the Company and subsidiaries had capital commitments to pay construction in progress and purchase of computer software in the total amount of approximately Baht 0.65 million and Baht 0.28 million, respectively.

33.2 As at October 31, 2009 and 2008, the Company and subsidiaries had commitments to pay the rental and service charge according to agreements in the total amount of approximately Baht 11.34 million and Baht 7.44 million, respectively.

33.3 Since June 2008, the Company has been a defendant in litigation in the Labor Court.

The case is still before the court, the Company has not recorded a provision in the financial statements for the year ended October 31, 2009.

34. Approval for Issuing of Financial Statements These financial statements have been approved for issuing by the Company’s Board of Directors on December 11, 2009.

III 113 Attachment 112 Report of the Independent Certified Public Accountants and Financial Statements

Pico Group International Network

America : Atlanta, Chicago, Los Angeles Europe, Africa, Middle East : Bahrain, Cairo, Doha, Dubai, Kuwait, London, Paris Asia Pacific: Bangkok, Beijing, Brunei, Chengdu, Chennai, Chongging,

Colombo, Dongguan, Guangzhou, Hanoi, Ho Chi Minh City, Hong Kong, Kula Lumpur, Macau, Melbourne, New Delhi, Noida, Seoul, Shanghai, Shenzhen, Singapore, Sydney, Taipei, Tokyo

Pico (Thailand) Public Company Limited 10 Soi Lasalle 56, Sukhumvit Rd., Bangna, Bangna Bangkok 10260, Thailand Tel : (66) 2 748-7007 Fax : (66) 2 745-8521, 745-8522 www.picothai.com