Annual Report 2009 by Piyanuch Meechit

ANNUAL REPORT 2009

RAIMON LAND PLC. THE RIVER RISES IN PROGRESS

ONGOING CONSTRUCTION

ONE FLOOR EVERY WEEK

ATTENTION TO DETAIL

CONTENTS Chairman’s Message 5 CEO’s Message 7 Section 1: Corporate Review Corporate Review 8 - Financial Review 9 - Market Review 14 - Project Review 18 - CSR Review 24 Audit Committee Report 26 Board of Directors 28 Section 2: Corporate Information Corporate Structure 29 General Information on the

30 Company, its Subsidiaries,

Jointly Controlled Entities,

and Other Relevant

Companies Shareholder and Capital

32 Structure Management 35 Connected Transactions 58 Risk Factors 61 Section 3: Financial Statements Auditor’s Report 67 Consolidated

68 Financial Statements Notes to Consolidated

77 Financial Statements

MESSAGE FROM THE CHAIRMAN The continuing global economic crisis combined with Thailand’s ongoing political unrest made 2009 a trying year for the real estate industry. Raimon Land Plc, however, has shown collective resilience, coming through the crisis stronger and more focused than ever. In early 2009, Raimon Land went through a significant restructuring, both financially and operationally. These changes were supported by IFA Hotels & Resorts, which increased its shareholding from 26.16% to 41.08% in Raimon Land. This was a reassuring move by our major shareholder which shows that Raimon Land still has solid investor support and a long-term belief in the potency of the market in Bangkok and Thailand’s resort areas. Moving forward, Raimon Land will continue to make significant progress on initiatives aimed at permanently reducing our cost structure by enhancing productivity, efficiency and effectiveness. Raimon Land’s recent display of flexibility and ability to adapt to the changing nature of the world’s economic status will also remain the company’s main focus amidst Thailand’s ever-increasing whirlwind of political instability. With the continued support of our shareholders and investors, I am confident that Raimon Land will continue to be an influential real estate developer in the constantly growing Thailand market. Our commitment to clients and shareholders will always be at the forefront along with our guiding principles of intelligence, innovation and integrity. On behalf of the Board of Directors, I would like to thank our shareholders, management and staff for their efforts and hard work throughout the past year. Through the ups and downs of 2009, everybody managed to pull through with more purpose and belief. The next chapter of Raimon Land will definitely be an intriguing one. (Mr. Sompoch Intranukul) Chairman of the Board of Directors

MESSAGE FROM THE CEO The ongoing global financial crisis in 2009 prompted Raimon Land to take a number of strategic management initiatives to reduce costs, improve efficiency and revitalise its focus on existing projects under construction. As part of an effort to consolidate its assets, Raimon Land increased its aggregate investment in Taksin Hotel Holdings, The River’s holding company, from 60% to 85%. As a result, Raimon Land’s revenue stream derived from this project is expected to increase from Baht 9.0 billion to Baht 12.75 billion over the next three years. Similarly, the resulting profit sharing from proceeds on the project will increase 25%. New financing options were also implemented to reduce and diversify the company’s overall cost of funds. Loans for Contemporary Property Co. Ltd and Raimon Land Development Co. Ltd were successfully refinanced at reduced rates with prominent Thai banks. The credit facility for the Northpoint project in Pattaya was increased by Baht 250 million whilst the loans for The Heights Phuket and The Lofts Yennakart, two of our most recently completed projects, were repaid in full, totaling Baht 590 million. In an effort to remain competitive, Raimon Land rolled out an effective reorganisation program, which eventually reduced overhead expenses by approximately 40%. The company also worked closely with its major shareholder, IFA Hotels & Resorts, to implement operating synergies, particularly on the sales and marketing front as well as human capital management. As a result, Raimon Land was able to expand its distribution network internationally and reduce its overall cost of sales. With healthy financial fundamentals, solid support from shareholders and a prime land bank, Raimon Land is on track for growth. Northpoint is set for completion in Q2 2010 whilst The River superstructure should reach level 65 by the end of the year, well on schedule. Most importantly, the company will resume its expansion program in 2010 with the launch of its most exclusive project to date - 185 Rajadamri, a 240-apartment luxury condominium building in Bangkok CBD. New products will also be introduced at our resort destinations, with the launch of our exclusive Raimon Land Private Residence Clubs, which is already available at The Heights Phuket and will soon be available in Pattaya. Last but not least, I would like to express my sincere thanks to everyone involved for their dedication and determination to drive the company forward. Raimon Land will continue to set new standards in luxury property development in Thailand with more exciting projects to be unveiled in the near future. (Mr. Hubert R. Viriot) Chief Executive Officer

CORPORATE REVIEW

In 2009, the Company and its subsidiariesâ&#x20AC;&#x2122; revenue from property sales grew by 19 percent from last year. However, the consolidated operating results showed a loss of Baht 277 million. This was mainly attributable to a Baht 349 million provision for a loss resulting from the diminution in value of land awaiting sale in its subsidiary and of project development cost in its joint venture, as well as a Baht 228 million loss on a steel contract cancellation in another subsidiary.

Profit and Loss Summary

2009 (Million Baht)

2008 (Million Baht)

% Change 2008-2009

3,387

2,856

19%

(2,889)

(2,581)

12%

Loss from the diminution in value of land awaiting sale

(189)

n.a.

Share of loss from an investment in a joint venture resulting from the diminution in value of project development cost

(160)

n.a.

Loss from a steel contract cancellation

(228)

n.a.

EBITDA

(79)

275

n.a.

Depreciation & amortisation

(34)

(37)

-8%

EBIT

(113)

238

n.a.

Total revenue Net operating expenses

FINANCIAL REVIEW

2009 (Million Baht)

2008 (Million Baht)

% Change 2008-2009

(164)

(120)

37%

(4)

n.a.

Minority interest

n.a.

Net income (loss)

(277)

146

n.a.

Basic earnings (loss) per share

(0.09)

0.05

n.a.

Finance cost Corporate income tax

Revenue The total revenue of Raimon Land Plc. and its subsidiaries for the year 2009 is Baht 3.39 billion, an increase of 19 percent over the Baht 2.86 billion in 2008. In 2009, 84 percent of total revenue was recognised from two real estate projects, Northpoint Pattaya, which launched in late 2006 and will be completed in the second quarter of 2010, and The River, which launched in early 2007 and is scheduled for completion in late 2011 or early 2012.

2009

The Heights Phuket Northpoint The Lofts Yennakart The River Other* Total

2008

Revenue (Million Baht)

(9)

226

1,151

34%

1,494

52%

273

143

1,684

50%

734

26%

288

259

3,387

100%

2,856

100%

* This includes revenue realised from other projects, rental and service income, project management fee income, commission income, interest income, gain on debt settlement, gain on foreign exchange rates, and revenue from the reversal of accrued specific business tax and accrued transfer fees.

Cost of goods sold The cost of goods sold equals 69 percent of total expenses. The cost of goods sold increased from Baht 1.77 billion in 2008 to Baht 2.30 billion in 2009, which is consistent with the increase in revenue. The details are shown in the following table.

FINANCIAL REVIEW

Project

% of Completed Construction at Year End 2009

Cost of Goods Sold Cost of Goods Sold in 2009 in 2008 (Million Baht) (Million Baht)

The Heights Phuket

100%

(6)

215

Northpoint

90%

958

954

The Lofts Yennakart

100%

253

100

The River

31%

1,092

431

Other projects

100%

2,297

1,774

Total

Gross profit The gross profit margin declined from 34 percent in 2008 to 26 percent in 2009 since the Company and its subsidiary adjusted project development cost estimates at Northpoint and The River upward in 2009.

Selling and administrative expenses Selling and administrative expenses are the second major expense of Raimon Land, and accounted for 25 percent of total expenses in 2009. Selling and administrative expenses increased from Baht 821 million in 2008 to Baht 850 million in 2009, a 4 percent increase. The increase of such expenses was caused by the following factors: - The reduction of Baht 247.6 million in advertising and other selling expenses: in response to the global and domestic economic recession, the Company and its subsidiaries reduced advertising and other selling expenses to Baht 94.3 million in 2009 from Baht 341.9 million in 2008. - The expense incurred from the steel contract cancellation: due to a decline in steel prices, one of the Companyâ&#x20AC;&#x2122;s subsidiaries terminated a purchase agreement with a supplier and paid Baht 228.2 million in cancellation fees. However, from the contract cancellation, the Company reduced its steel material costs by at least Baht 100 million (should the subsidiary buy the steel on the agreement termination date). - The loss of approximately Baht 82.2 million from writing off assets. Selling and Administrative Expenses

2009 (Million Baht)

2008 (Million Baht)

% Change 2008-2009

Salary and staff benefits

80.2

91.8

-12.64%

Management remuneration

44.4

49.5

-10.30%

Severance pay

28.1

n.a.

Depreciation and amortisation

34.4

36.6

-6.01%

Specific business tax & transfer fee

68.2

32.0

113.13%

Other selling expenses

94.3

341.9

-72.42%

Selling and Administrative Expenses

2009 (Million Baht)

2008 (Million Baht)

% Change 2008-2009

Loss from writing off assets

82.2

n.a.

Loss from steel contract cancellation

228.2

n.a.

Other expenses

190.3

269.0

-29.26%

Total

850.3

820.8

3.59%

Loss on diminution in value of land awaiting sale One of the Company’s subsidiaries entered into a sales-purchase agreement to sell land at the price of Baht 726.8 million, and the expected recoverable amount is less than its book value. Therefore, Baht 188.9 million is reserved as allowance for the loss on diminution in value of land awaiting sale. Later in January 2010, the subsidiary received the balance of the remaining amount according to the sales-purchase agreement from the buyer and transferred ownership of the land to the buyer.

Share of loss from investment in joint ventures The share of loss from investment in joint ventures increased from 2008 due to the allowance for loss on the diminution in value of project development cost in one of the Company’s joint ventures. As a result, the Company recorded a Baht 160.3 million share of loss from such allowance.

Finance costs Most of the finance expenses from project development borrowing is capitalised as project development cost until project completion. In 2009, the Company borrowed more from its major shareholder and the finance expense of The Heights could not be capitalised since it was already completed in 2008. Therefore in 2009, the finance expense of The Heights was recorded as expense in 2009.

Net loss In 2009, Raimon Land and its subsidiaries had a net loss of Baht 277.1 million, while in 2008, Raimon Land and its subsidiary had a net profit of Baht 145.8 million. The loss in 2009 resulted from the following: - One of the Company’s subsidiaries recorded a Baht 228.2 million loss from the termination of the agreement to purchase steel from a supplier. - One of the Company’s subsidiaries reserved Baht 188.9 million of allowance for loss on the diminution in value of land awaiting sale. - One of the Company’s jointly controlled entities reserved the allowance for loss on the diminution in value of project development cost; hence, the Company’s share of the recorded loss from such allowance was Baht 160.3 million. For the year 2009, loss per share was Baht 0.09 (2008: earnings per share was Baht 0.05).

FINANCIAL REVIEW

Balance Sheet Summary 2009 (Million Baht)

2008 (Million Baht)

% Change 2008-2009

Cash and cash equivalent

361

336

Project development cost

5,480

6,014

-9%

Other current assets

2,507

1,978

27%

120

250

-52%

Other non-current assets

1,079

1,102

-2%

Total assets

9,547

9,680

-1%

Current liabilities

5,148

4,228

22%

Non-current liabilities

1,960

2,344

-16%

Total liabilities

7,108

6,572

Total shareholders’ equity

2,439

3,108

-22%

Total liabilities & shareholders’ equity

9,547

9,680

-1%

Fixed assets

Assets Raimon Land’s total assets as at 31 December 2009 equal Baht 9.55 billion, which is close to the total assets of Baht 9.68 billion the year before. The slight decrease was due to the disposition of building and non-operating equipment at one of the Company’s projects.

Liabilities The Company’s total liabilities as at 31 December 2009 equal Baht 7.11 billion, which increased from the end of last year by Baht 0.54 billion. The liabilities increased by 8 percent. The increase of liabilities is caused by the following: - A subsidiary drew down an additional project loan of Baht 1,804 million in 2009 (2008: Baht 1,256 million). - An additional short-term borrowing from IFA of Baht 218 million in 2009 to be used as working capital.

Shareholders’ equity At the end of 2009, shareholders’ equity of the Company equals Baht 2,439 million, a 22 percent decrease from 2008. The increase was mainly caused by operating loss and the cash and share interim dividend distributed in 2009.

Liquidity The Company’s liquidity in 2009 is similar to that in 2008. The Company spent Baht 469 million in operating activities and Baht 76 million in investing activities. The Company received Baht 543 million from financing activities, mainly in terms of borrowings from financial institutions and a major shareholder.

The increase in total loan amount caused the Companyâ&#x20AC;&#x2122;s interest-bearing debt-toequity ratio to increase from 1.65 to 2.29. The Company expects that the profit derived from its operating results and the success of existing and new projects will help reduce the debt-to-equity ratio in 2010.

Summary of Key Financial Ratios (from Consolidated Financial Statement) 2009

2008

1.62 0.56 2.26

1.97 0.55 2.28

25.88% -8.18% -10.58% -2.88%

34.47% 5.10% 5.43% 1.66%

Efficiency Ratios - Total asset turnover (times) - Fixed asset turnover (times)

0.32 16.76

0.31 11.10

Leverage Ratios - Debt to equity ratio (times) - Interest-bearing debt to equity (times) - Interest coverage ratio(2) (times)

2.91 2.29 -0.69

2.11 1.65 1.98

Per Share Ratios - Book value per share(3) (Baht) - Earnings per share (Baht) - Dividend per share(4) (Baht)

0.72 -0.09 0.09

0.96 0.05 -

-1.37% 8.17% -21.54% 18.59%

11.59%

22.13% 26.22% 14.29% 65.06% 48.73%

Liquidity - Current ratio (times) - Quick ratio (times) - Accounts receivable turnover (times) Profitability Ratios - Gross profit margin(1) (%) - Net profit margin (%) - Return on equity (%) - Return on assets (%)

Percentage of Growth (% per year) - Total asset growth (%) - Total liability growth (%) - Total shareholderâ&#x20AC;&#x2122;s equity growth (%) - Total revenue growth (%) - Total expenses growth(5) (%)

(1) Gross profit margin = (total sales - cost of sales)/total sales, whereas total sales means recognised sales of residential condominium units. (2) Interest coverage ratio = earnings (loss) before finance cost and income tax/finance cost, whereas finance cost means interest and other charges related to financing activities, e.g., front end fee. (3) Book value does not include equity attributable to minority shareholders. (4) In cash and non-cash, but measurable in monetary terms, e.g., share dividends. (5) Excluding loss on diminution in value of land awaiting sale, share of loss from an investment in

a joint venture resulting from the loss on diminution in value of project development cost, and the loss from a steel contract cancellation in 2009.

2009 as a whole showed better than expected results for most developers in the marketplace, and gradually improved over the year. In the second half of the year, developers became more confident about launching new projects and received a good response in presales, the Thai GDP turned positive in the fourth quarter and international arrivals bounced back to where they were prior to the global financial turmoil and airport closures. Bangkokâ&#x20AC;&#x2122;s Residential Condominium Market in 2009 In 2009, there were a total of approximately 22 new condominium projects with approximately 4,730 units launched in downtown Bangkok. In the first half of the year there was very little activity but the third quarter saw developers release developments that were already in an established pipeline, confident that the market would be more accepting of new launches. In the final quarter, 4 projects were launched in downtown Bangkok comprising 813 units with a combined value of approximately Baht 6.3 billion alone. Last year, condominium presales by major listed developers rose to Baht 46 billion, a 25 percent increase over 2008, demonstrating strong growth despite the general global economic malaise. Demand was predominantly generated from Thailand. Sales were still most prevalent in the low-end sector, comprising 51.3 percent of the total in 2009. Well-established developers of mid- to high-end condominiums saw robust growth with condominium presales increasing by 133 percent year-on-year, dominated by an excellent second half of the year when developers began to launch new projects in the downtown area. Lesser-known brands with little track record did not do so well with the lionâ&#x20AC;&#x2122;s share of the market going to the recognised property companies.

MARKET REVIEW

High presales of condominiums in Q4 were mostly attributed to five new project launches for a combined value of Baht 9.8 billion, of which more than 70 percent has been sold. These projects are mostly located in metro Bangkok in areas such as Ratchayothin and Ratchadapisek, and range in price from Baht 1.5 to 3.0 million per unit. Total Q4 presales were worth Baht 15.1 billion, up 380 percent from the same period last year. On the year, the 2,678 new condominium unit transfers in downtown Bangkok tallied Baht 21.5 billion for an average of Baht 97,183/sq.m. or approximately eight million baht per unit. The increase was evident throughout 2009 as the average price of unit transfers steadily rose from approximately Baht 92,935/sq.m. in Q1 to Baht 93,231/sq.m. in Q2, a 10 percent jump from the end of the previous year. Prime Sukhumvit locations accounted for the most transfers in downtown Bangkok in 2009 with 900 units valued at a total of Baht 6.2 billion, followed by the Silom/Sathorn central business district (CBD) with 843 units worth approximately Baht 7.6 billion. Central Lumpini, between the CBD and upscale shopping complexes, remains the cityâ&#x20AC;&#x2122;s most expensive area, with 532 newly completed condominium units being transferred at an average price of Baht 114,751/sq.m., worth about Baht 5.5 billion. The Silom/Sathorn CBD continues to be foreignersâ&#x20AC;&#x2122; most sought-after residential area, with 18 percent of the 843 units transferred being purchased by international buyers. This popularity has placed the CBD into the second-most-expensive slot, with an average transfer price of Baht 107,817/sq.m.

MARKET REVIEW

Outlook for 2010 A very competitive year is anticipated in 2010, with approximately 5,542 units expected to be completed, plus another approximately 8,728 units currently in the pipeline for the following years. Even if 77 percent of the units expected to be complete in 2010 have already been sold off plan, we expect to see some of these units put on the resale market and compete with off plan projects. On the supply side, we have seen developers acquiring new sites in the last couple of months and set new sales targets, therefore we anticipate the off plan market to be active in 2010, mostly with developers taking advantage on new mass transit lines. On the demand side, we see a strong domestic demand for city-compact condominiums located closed to existing and upcoming BTS/MRT stations. The registrations of condominiums are now surpassing any other type of property and have become a leading choice for homebuyers.

Transfer Prices Average Price of Condominium Units Transfered in Downtown Bangkok (THB/sq.m.) 120,000 100,000 80,000 60,000 40,000 20,000 0

Q1/08

Q2/08

Q3/08

Q4/08

Q1/09

Q2/09

Q3/09

Q4/09

Condo Presales Performance by Major Listed Developers (THB Million) 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0

Q1/08

Q2/08

Q3/08

Q4/08

Q1/09

Q2/09

Q3/09

Q4/09

Sources: AP, LPN, MJD, NOBLE, SIRI, SPALI, PS, RAIMON

Raimon Landâ&#x20AC;&#x2122;s Customers Thai nationals are the single most important group of buyers for Raimon Land with a billion baht

of sales in 2010. Adding the Baht 150 million in sales to foreigners living in Thailand, our domestic demand represents 68 percent of total sales in 2010. Our international demand secured Baht 560 million, with Swedish, French and Italians the top three nationalities of foreign buyers. Europeans were by far the most active markets with 25 percent of total sales in 2010, followed by a growing demand from Asia totalling 12 percent of sales. The traditional markets of North America, the United Kingdom and Australia were almost absent this year, certainly as a result of the global economic turmoil and currency fluctuations. Additionally, regardless of nationality, one third of foreign buyers are living in Hong Kong, which saw a great recovery in 2009 particularly in the financial markets, plus another 30 percent living in Asian countries.

Moving forward, the profile of our customers has reshaped over the past few years and we believe it will continue to change in the coming years as the whole world map is now switching towards the East. We see great potential in China and other Asian countries such as India, South Korea, Taiwan and Malaysia. Most importantly, we see our domestic markets becoming stronger and this trend will continue and remains the first priority for the Company.

Sales by Buyer Nationality in 2009

Russia 1.2% China US & Canada

25.3% Europe

Other Asian Countries

1.0%

2.4% Hong Kong 2.8%

Thailand 59.0% Malaysia

2.8%

3.4%

Singapore

1.5%

Australia & New Zealand 0.6%

Sales by Buyer Residence in 2009

Russia 1.2% US & Canada

7.4%

China

Europe

1.8%

Hong Kong 4.4%

Middle East 0.6%

Thailand 67.7%

Africa 1.0%

Other Asian Countries

2.3%

Malaysia

10.0%

2.7%

Singapore

0-5%

0.9%

6-50%

51-100%

Total Sales Value: 1,734 Million Baht

PROJECT REVIEW

In 2009, Raimon Land completed The Heights Phuket project and transfer commenced in January 2009. For The River project, the Companyâ&#x20AC;&#x2122;s largest project, the total sales value is nearly Baht 15 billion and already over Baht 9,200 million has been sold. Construction has progressed: from the completion of the sub-structure in early 2009 until the end of February 2010, the structure has been completed up to level 31 of building A and level 24 of building B. Additionally, Raimon Land expects to complete the Northpoint project, the Companyâ&#x20AC;&#x2122;s second largest, by the second quarter of 2010. Also in the same quarter, the Company plans to formally launch the 185 Rajadamri project. In 2010, Northpoint, the River and 185 Rajadamri will be the main income-generating projects for the Company.

Project

Type

Launch year

Land Saleable No. of area units area (Sq.m.) (RaiNganWah)

Project Average Completion year sales price value per (Million Sq.m. Baht)

Completed Projects Townhouse

Q1/2003

3-0-64

3,486

400

115,000

2004

The Lakes Condominium

Condominium

Q3/2003

1-2-90.5

26,062

165

1,685

65,000

2005

The Legend Saladeang

Condominium

Q1/2004

1-1-40

9,672

842

87,000

2005

Northshore

Condominium

Q3/2004

2-1-51

21,271

193

1,490

71,000

2006

Kata Gardens

Condominium

Q4/2004

5-0-59.4

6,767

447

66,000

2006

The Lofts Yennakart

Condominium

Q3/2005

3-0-19.1

17,240

176

1,234

72,000

2007

The Heights Phuket

Condominium

Q4/2005 14-0-41.2

13,337

1,205

90,500

Q4/ 2008

The Lofts Sathorn

Ongoing Projects Northpoint

Condominium

Q4/2006

12-0-54

40,095

376

5,000

125,000

2010

The River

Condominium

Q1/2007

12-3-41

104,359

838

14,950

145,000

2011/ 2012

38,505

240

9,625

250,000

2013

Future Projects

185 Rajadamri

Condominium

2010

4-1-62.9

Edge

Condominium

2010/ 2011

5-3-70

In design phase. Total project value: Baht 4,000-5,000 million

Raimon Land is a property developer, specialising in residential project developments. In the past years, the Company’s projects included condominiums, townhouses, and single houses. However, the Company’s current focus is the development of premium condominiums and/or villas, targeting customers in the mid- to high-income range who prefer downtown locations nearby their workplaces and business areas and/or who wish to have holiday homes. Therefore, the Company’s projects are mainly developed in central areas of Bangkok and/or the business districts or holiday destinations with amenities and beach access. The projects are operated directly by Raimon Land, its subsidiaries and/or through joint ventures with other investors or companies.

Projects in 2009 In 2009, Raimon Land Public Company Limited developed and/or sold the following 4 projects:

The Lofts Yennakart The Lofts Yennakart was launched in 2005 following the success of The Lofts Sathorn. The property comprises 176 condominium units located adjacent to Bangkok’s central business district in Soi Amorn. All units had been sold and transferred to customers by year end 2009.

PROJECT REVIEW

The Heights Phuket The Heights Phuket overlooking Kata Beach was also launched in 2005. At the end of 2009, project construction was completed and over 80 percent of the project had been sold. Transfer commenced in January 2009. 100% completed

100%

79% of saleable area contracted

80% 77% of project value P&L recognised

60% 40%

77% of project value collected

20% 0%

Formal Launch (FL)

FL+12 months

FL+24 months

FL+36 months

FL+48 months

100%

90% completed

80%

69% of saleable area contracted

60%

59% of project value P&L recognised

40%

32% of project value collected

20% 0%

Formal Launch (FL)

FL+12 months

FL+24 months

FL+36 FL+42 months months

Northpoint Northpoint is Raimon Landâ&#x20AC;&#x2122;s second Grade A condominium development in Pattaya. With 80 metres of beach frontage on Pattayaâ&#x20AC;&#x2122;s Wong Amat Beach, the property will allow for uninterrupted views and provide extensive facilities. The project was launched in 2006. The project construction is expected to be completed by the second quarter of 2010. Northpoint comprises 376 condominium units. The total value of the project sold at the end of the first quarter of 2010 was over Baht 3,300 million.

PROJECT REVIEW

The River Located on the Chao Phraya riverbank, The River is Raimon Landâ&#x20AC;&#x2122;s largest project to date. From its launch to date, the project has received good customer response. At the end of 2009, Baht 9.2 billion or about 62 percent of the total project value had been sold. In 2009, project construction had significantly progressed.

In early 2009, the construction of the sub-structure was completed and at the end of February 2010, the structure had been completed up to level 31 of building A and level 24

of building B. When completed, by late 2011 or early 2012, The River will be the tallest riverfront residential building

in Bangkok, with a shuttle boat service to the Saphan Taksin skytrain station. Bedrooms, living areas, and studies will enjoy spectacular floor-to-ceiling city and riverside views.

100% 80%

67% of saleable area contracted

60% 40%

31% completed 18% of project value collected 16% of project value P&L recognised

20% 0%

Formal Launch (FL)

FL+12 months

FL+24 months

FL+36 FL+42 months months

Future Projects for 2010-2011 In 2010-2011, Raimon Land plans to launch at least two projects with a sales value of nearly Baht 15 billion as follows:

185 Rajadamri In 2007, Raimon Landâ&#x20AC;&#x2122;s subsidiary acquired a plot of land situated along the prestigious Rajadamri Road at the heart of Bangkokâ&#x20AC;&#x2122;s central business district. It will be the only project in this area that offers freehold ownership while others offer leasehold. The property will offer buyers views across Lumpini Park and the Royal Bangkok Sports Club. With approximately 240 condominium units in total, the project has a combined project value of nearly Baht 10 billion. The Company plans to officially launch the project in the second quarter of 2010, and the project is scheduled for completion in 2013.

Edge Located next to the Northpoint site in Pattaya, Edge will have 45 metres of Wong Amat beach frontage with panoramic views in all directions. Design work is underway. The project will have a sales value of Baht 4-5 billion.

CSR REVIEW

Raimon Land’s ongoing support of its corporate social responsibility (CSR) program remained active in 2009 as the Company strived to continue to make a difference through its involvement with a variety of charities and foundations. We are delighted that our participation has provided the underprivileged with not only the basic necessities, but opportunities as well. Home to 40 children in the Klong Toey community area, Baan Mercy Ruamjai Pattana was completed in May and is now providing children from the age of five to the late teens with a safe, non-abusive environment and as normal an upbringing as possible in light of their circumstances.

Raimon Land is also committed to providing a better lifestyle for the construction workers and their families who are based at our project construction sites. The Sanuk Community Centre in Pattaya offers children of the construction team Thai and English lessons as well as education in basic hygiene, health and safety. In addition to supporting underprivileged children and providing educational programmes for the children of construction workers, Raimon Land has been fostering our adopted female calf elephant, Pang Raimon, in a natural habitat at the Anantara Elephant Camp in Chiang Rai. Our longterm sponsorship commitment to supporting Pang Raimon ensures that one of Thailand’s national treasures and one of the world’s threatened species remains in proper care for the rest of her life. Faithful to our focus on “developing a better environment”, Raimon Land is an active supporter of initiatives that improve the environment and help raise environmental awareness in Thailand. Our

developments are equipped with environmentally friendly infrastructure to reduce energy consumption and lower the carbon footprint of our buildings. The Raimon Land-funded tree nursery in Khao Yai, operated by the Plant-A-Tree-Today Foundation, is currently home to an abundance of forest tree saplings that will be supplied to various organisations for their tree-planting projects. The nursery center also acts as a base for reforestation and research in the local area. Earlier in 2009, Raimon Land also participated in the inaugural Walk 4 Women, a 24-hour team and individual walk/run event, to raise funding and increase awareness of cervical cancer, promote its prevention and encourage a healthy lifestyle. According to GLOBALCAN2000, 6,100 new cases of cervical cancer are diagnosed in Thai women each year and account for 3,100 deaths. Sponsoring such an event enabled us to contribute to raising awareness of the most common cancer among Thai women. Raimon Land is also proud to support initiatives that raise the profile of the arts and promote the talents of young artists. As a main sponsor of the Royal Over-Seas Leagueâ&#x20AC;&#x2122;s Young Artist of Thailand and Young Musicians of Thailand competitions, we have been able to give young Thai artists and musicians a platform to promote their work and further develop their talents. Through the sponsorship of various sporting events, Raimon Land has been able to help increase the profile of Thailand and its resort destinations as well as help to raise money for worthy causes across the kingdom. Our longstanding support of the sailing community in Thailand continued in 2009 with the sponsorship of the Phang-Nga Bay Regatta in the south and the Top of the Gulf Regatta in Pattaya.

AUDIT COMMITEE REPORT

The Company’s Audit Committee is comprised of three independent directors qualified under the Best Practice Guidelines for Audit Committees of the Stock Exchange of Thailand. Presently the members of the Company’s Audit Committee are Mr. Kitti Gajanandana as the chairman, Mr. Somphoch Intranukul and

Mr. Jirawud Kuvanant as members, and Ms. Valdee Sriboonrueng as secretary. The Audit Committee has performed its duties in accordance with the scope, duties and responsibilities as assigned by the Board of Directors which are consistent with the relevant rules of the Stock Exchange of Thailand. There were four meetings of the Audit Committee in the accounting year of 2009 and one meeting of the Audit Committee in 2010 until the date of this report, totaling five meetings. The Audit Committee had meetings with the company’s management, external auditor and internal auditor as appropriate. The summary of such meetings are as follows: 1. Review of Quarterly Financial Statements and 2009 Financial Statements. The Audit Committee heard management’s and the auditor’s explanation of the completeness and accuracy of the Company’s financial statements and the adequacy of disclosures made including the accounting audit plan of the external auditor for 2009 with which the Audit Committee agrees, as it does with the external auditor that the Company’s financial statements were correctly prepared in all material respects in accordance with generally accepted accounting principles. 2. Review of Information Relating to Operations and Internal Control Systems. The review is made to evaluate the adequacy, appropriateness and efficiency of the internal control system, which will enhance the Company’s operations and ability to achieve its target, taking into account the 2009 Internal Control Report, and to see if the operation has complied with the plan approved. The report covers major systems of the Company. The Audit Committee followed up with management to ensure that corrections and adjustments were constantly made in accordance with the internal audit’s recommendations. In addition, the Audit Committee made an evaluation of the internal control system in accordance with the guidelines of the Securities and Exchange Commission. The external auditor is of the view that the Company maintains a good internal control system, proper inventories and accurate, complete and reliable disclosure of information, and the Audit Committee is of the same view. The Audit Committee is of the view that the Company also maintains adequate, appropriate and effective supervision and follow-up systems in respect of the operation of the Company’s subsidiaries.

3. Review of Internal Controls. The review is made by taking into account the assignments, scope of performance, duties, responsibilities, independence, manpower and budget of the Internal Control Department. The Audit Committee also approves the annual audit plan, which requires adequate, appropriate and effective internal controls. 4. Review of Law Compliance. The Audit Committee found no material issues in relation to non-compliance with relevant laws and the rules of the Stock Exchange of Thailand and other laws concerning the Company’s business including the agreements between the Company and third parties. 5. Review of Risk Management System. The review is made to ensure the link between the internal control system and risk management system in order to manage risk for the whole Company. In the review, the Company takes into account policy, risk factors, and guidelines for risk management including procedures that the Company is in the process of developing to be more effective. 6. Review of Connected Transactions and Disclosure of Relevant Information. The review is made in accordance with the requirements of the Stock Exchange of Thailand and the Securities and Exchange Commission. The auditor is of the view that information relating to commercial transactions between the Company and related parties has been disclosed and shown in the Company’s financial statements and notes to the financial statements in all material respects. The Audit Committee is of the same view as the auditor and further believes that such transactions are reasonable and have been made in the best interests of the Company’s business operations and the relevant disclosures have been correctly and completely made. 7. Selection and Nomination of the Auditor and Auditor’s Remuneration for 2010. This is made in order to gather information to propose to the Board of Directors for approval by the 2010 Annual General Meeting of Shareholders. The Audit Committee has taken into account the performance, independence and appropriateness of auditor’s remuneration and is of the view that Mr. Supachai Phanyawattano, certified public accountant no. 3930, or Mr. Narong Puntawong, certified public accountant no. 3315, or Ms. Chonlaros Suntiasvaraporn, certified public accountant no. 4523, of Ernst & Young Office Limited should be re-appointed as the Company’s auditor for 2010 with the remuneration of Baht 1,180,000. The Audit Committee’s view relating to the re-appointment of the Company’s auditor is as follows: In the last fiscal year, the auditor has performed his or her work with knowledge and professional standards. The recommendations relating to the internal control system and risks including independence have been made. In performing their work, the Securities and Exchange Commission’s requirements relating to the rotation of the auditor who certifies the financial statements every five fiscal years have been complied with. If the appointment of the auditor for 2009 is approved, it will be the third consecutive year. The auditor has no relationship with the Company and its subsidiaries. Opinion on Performance of Duties Overall, the Audit Committee has completely performed its duties as specified in the Audit Committee Practice Code which has been approved by the Board of Directors. The Audit Committee is of the view that the Company has maintained accurate financial, internal audit, operations and internal control systems. The Company has been in compliance with the relevant laws, requirements and agreements. The disclosures relating to connected transactions have been accurately made, and the operation is consistent with good, transparent and reliable corporate governance. 12 March 2010 For and on behalf of the Audit Committee (Mr. Kitti Gajanandana) Chairman of the Audit Committee

BOARD OF DIRECTORS

Raimon Land has assembled a strong and respected Board of Directors with a wealth of property-related experience across a diverse range of markets and disciplines. It is well equipped to guide executive management towards long term value creation for all shareholders and stakeholders.

Mr. Sompoch Intranukul Chairman of the Board of Directors,

Independent Director and Audit Committee Member

Mr. Talal J M A Al Bahar Director and Chairman of the Executive Committee

Mr. Werner Johannes Burger Director and Executive Committee Member

Mr. Hubert Romary Bertrand Viriot Director, Executive Committee Member and

Chief Executive Officer

Mr. Michael Burns Neilson Director

Mr. Ibrahim S A Al-Therban Director

Mr. Kitti Tungsriwong Director, Executive Committee Member and

Corporate Secretary

Mr. Kitti Gajanandana Director, Independent Director and

Chairman of the Audit Committee

Mr. Jirawud Kuvanant Director, Independent Director and

Audit Committee Member

Corporate Structure of Raimon Land Public Company Limited in 2009

Raimon Land Public Company Limited Active Subsidiaries

Inactive Subsidiaries 99.99%

Raimon Land Park View (a) Development Co., Ltd. Develop 185 Rajadamri

Wireless One Residences Co., Ltd.

99.99%

95% Contemporary Property Co., Ltd. Develop The Lofts Yennakart

Raimon Land Planner Co., Ltd.

98.59% 99.99%

Raimon Land Property Co., Ltd.

11% Taksin Hotel Holding Co., Ltd.

(b)

74%

Notes:

99.99% Taksin Properties Co., Ltd. Develop The River

Raimon Land Resorts Co., Ltd. Investment and Service

99.93%

Active Jointly Controlled Entities Raimon Land (c) Development Co., Ltd. Develop The Lofts Southshore and Edge

51%

Raimon Land (c) Residences Co., Ltd.

51%

51% Ploenchit Residences Co., Ltd. Hold Ploenchit land

(c)

99.94% d)

Ploenchit Management Co., Ltd. ( Investment and/or Operations

(a) Lehman Brothers Commercial Corporation Asia Ltd. (LBCCA) held a call option to buy a 25 percent share in Raimon Land Park View Development Co., Ltd. from Raimon Land Plc. under an option agreement. However, on 9 February 2010, LBCCA confirmed in writing that it will not exercise such option. (b) In accordance with the resolution of the Annual General Meeting of Shareholders 2009 held on 29 April 2009, Raimon Land Plc. purchased 25% of shares in Taksin Hotel Holding Co., Ltd. Therefore, the percentage of shareholding of the Company in the subsidiary increased from 49% to 74%. (c) The shareholders holding the other 49 percent share in each jointly controlled entity are related to IFA Hotels & Resorts 3 Ltd, the Companyâ&#x20AC;&#x2122;s major shareholder. (d) Incorporated on 13 January 2010 with registered capital of Baht 500,000.

General Information of the Company, its Subsidiaries, Jointly Controlled Entities, and Other Relevant Companies Company (Registration No.) 1)

Raimon Land Public Co., Ltd. (0107536001508)

Address

Business

Authorised Capital (baht)

Paid-up Capital (baht)

% of Investment

The Millennia Tower, 22/F, Units 2201-3, 62 Langsuan Road, Lumpini, Pathumwan, Bangkok 10330 Tel: 66 (0) 2651 9601-4,66 (0) 2651 9615-6 Fax: 66 (0) 2651 9614 E-mail: info@raimonland.com Website: www.raimonland.com

Property development

3,312,173,403

3,250,385,569

Subsidiaries

Raimon Land Property Co., Ltd. (0105549071761)

The Millennia Tower, 22/F, Units 2201-3, 62 Langsuan Road, Lumpini, Pathumwan, Bangkok 10330 Tel: 66 (0) 2651 9601-4,66 (0) 2651 9615-6 Fax: 66 (0) 2651 9614

Property development

10,000,000

99.99%

Raimon Land Park View Development Co., Ltd. (0105549121467)

The Millennia Tower, 22/F, Units 2201-3, 62 Langsuan Road, Lumpini, Pathumwan, Bangkok 10330 Tel: 66 (0) 2651 9601-4,66 (0) 2651 9615-6 Fax: 66 (0) 2651 9614

Property development

100,000,000

99.99%

Contemporary Property Co., Ltd. (0105526003476)

The Millennia Tower, 22/F, Units 2201-3, 62 Langsuan Road, Lumpini, Pathumwan, Bangkok 10330 Tel: 66 (0) 2651 9601-4,66 (0) 2651 9615-6 Fax: 66 (0) 2651 9614

Investment and property development

200,000,000

98.59%

Raimon Land Planner Co., Ltd. (0105543094441)

The Millennia Tower, 22/F, Units 2201-3, 62 Langsuan Road, Lumpini, Pathumwan, Bangkok 10330 Tel: 66 (0) 2651 9601-4,66 (0) 2651 9615-6 Fax: 66 (0) 2651 9614

Planner and Plan Administrator

2,000,000

95.00%

Taksin Hotel Holding Co., Ltd. (0105534045182)

The Millennia Tower, 22/F, Units 2201-3, 62 Langsuan Road, Lumpini, Pathumwan, Bangkok 10330 Tel: 66 (0) 2651 9601-4,66 (0) 2651 9615-6 Fax: 66 (0) 2651 9614

Property development and/or investing in subsidiary for property project development

1,232,030,000

84.84%

Taksin Properties Co., Ltd. (0105530057879)

The Millennia Tower, 22/F, Units 2201-3, 62 Langsuan Road, Lumpini, Pathumwan, Bangkok 10330 Tel: 66 (0) 2651 9601-4,66 (0) 2651 9615-6 Fax: 66 (0) 2651 9614

Property development

375,000,000

84.83%

Raimon Land Resorts Co., Ltd. (0105550123958)

The Millennia Tower, 22/F, Units 2201-3, 62 Langsuan Road, Lumpini, Pathumwan, Bangkok 10330 Tel: 66 (0) 2651 9601-4,66 (0) 2651 9615-6 Fax: 66 (0) 2651 9614

Investment and service

1,000,000

250,000

99.93%

Company (Registration No.) 8)

Wireless One Residences Co., Ltd. (0105551107123)

Address

Business

Authorised Capital (baht)

Paid-up Capital (baht)

% of Investment

The Millennia Tower, 22/F, Units 2201-3, 62 Langsuan Road, Lumpini, Pathumwan, Bangkok 10330 Tel: 66 (0) 2651 9601-4,66 (0) 2651 9615-6 Fax: 66 (0) 2651 9614

Property development

10,000,000

2,500,000

99.99%

Jointly Controlled Entities 1)

Raimon Land Development Co., Ltd. (0105549013966)

The Millennia Tower, 22/F, Units 2201-3, 62 Langsuan Road, Lumpini, Pathumwan, Bangkok 10330 Tel: 66 (0) 2651 9601-4,66 (0) 2651 9615-6 Fax: 66 (0) 2651 9614

Property development

1,000,000

51.00%

Raimon Land Residences Co., Ltd. (0105551069892)

The Millennia Tower, 22/F, Units 2201-3, 62 Langsuan Road, Lumpini, Pathumwan, Bangkok 10330 Tel: 66 (0) 2651 9601-4,66 (0) 2651 9615-6 Fax: 66 (0) 2651 9614

Property development and/or investing in subsidiary company for property project development

10,000,000

51.00%

Ploenchit Residences Co., Ltd. (0105551070491)

The Millennia Tower, 22/F, Units 2201-3, 62 Langsuan Road, Lumpini, Pathumwan, Bangkok 10330 Tel: 66 (0) 2651 9601-4,66 (0) 2651 9615-6 Fax: 66 (0) 2651 9614

Property development

10,000,000

26.01%

Ploenchit Management Co., Ltd. (0105553005034)

The Millennia Tower, 22/F, Unit 2201-3, 62 Langsuan Road, Lumpini, Pathumwan, Bangkok 10330 Tel: 66 (0) 2651 9601-4,66 (0) 2651 9615-6 Fax: 66 (0) 2651 9614

Property development and/or investment and/or operations

500,000

50.97%

Other Relevant Companies 1)

Ernst & Young Office Ltd.

33/F, Lake Rajada Office Complex, 193/136-137 Rajadapisek Road, Klongtoey, Bangkok 10110

Auditor of Raimon Land Plc, Subsidiaries and Jointly Controlled Entities

N/A

Allen & Overy (Thailand) Co., Ltd.

22/F, Sindhorn Building III, 130-132 Wireless Road, Lumpini, Pathumwan, Bangkok 10330

Legal Advisor of Raimon Land Plc.

N/A

Bangkok Jurist Ltd.

SSP Building 3, 19/F Silom Road, Suriyawong, Bangrak, Bangkok 10500

Legal Advisor of Raimon Land Plc.

N/A

Bunchong and Vidhya Law Office Ltd.

33/35, 33/39-40, Wall Street Tower, 9/F Surawongse Road, Suriyawong, Bangrak, Bangkok 10500

Legal Advisor of Subsidiaries and Associates

N/A

Shareholders and Capital Structure Raimon Land Plc.’s capital structure comprises both equity and debt financing. Equity financing: Ordinary shares i) The Company’s issued and paid up capital has increased from 2,999.8 million shares as at 1 January 2009 to 3,250.4 million shares as at 31 December 2009 due to the distribution of stock dividends in the first quarter of 2009.

Total registered capital (million shares)* Total issued and paid up capital (million shares)

1 January 2009

31 December 2009

4,172.1

3,312.2

2,999.8

3,250.4

* Par value at 1 Baht each

ii) The top ten shareholders shown in the Company’s share register book as at 20 August 2009 are: Name of Shareholder

% Shareholding

IFA HOTELS & RESORT 3 LTD

41.08%

Thai NVDR Co., Ltd.

33.68%

Quam Securities Company Limited A/C Client

2.99%

Mrs. Korkaew Mettri

1.36%

Quam Securities Company Limited

1.25%

Somers (U.K) Ltd.

1.21%

Focus Engineering and Construction Plc.

1.08%

Clearstream Nominees Ltd Government Saving Bank by Seamico Knight Fund Management Mr. Supachai Watcharasunthara

0.82% 0.69%

Total

0.67% 84.83%

As at 20 August 2009, the paid up ordinary shares of Raimon Land Plc. totalled approximately 3,250.4 million shares. Of the total issued shares, the first 10 major shareholders hold 84.83%, of which 41.08% is held by IFA Hotels & Resorts 3 Ltd, the Company’s major shareholder.

Warrants As at 1 January 2009 the details of Raimon Land Plc.â&#x20AC;&#x2122;s RAIMON-W2 are as follows:

Type Term of warrants Total number of warrants Number of shares reserved for exercise of warrants Number of warrants sold Exercise ratio Exercise price Exercise period

Last exercise date Total warrants exercised in 2009 Total warrants cancelled in 2009 Total outstanding warrants as at 31 December 2009

As at 1 January 2009 RAIMON-W2 (Non-listed) Named certificate warrants to purchase ordinary shares issued to directors and employees 5 years commencing 21 April 2004, which is the issue date of the warrants 67,487,400 units 67,487,400 shares 65,678,400 units 1 warrant to 1 share Baht 1.228 per share Last working date of each calendar month during the term of 5 years from the issue date of warrants (except for the last exercise date) 21 April 2009 0 units 59,987,834 units 0 units

On 20 April 2009, the last exercise date, there was no exercise of RAIMONW2. Therefore, 59,987,834 sold and unexercised warrants expired and were cancelled. Debt financing: The second component of Raimon Land Plc.â&#x20AC;&#x2122;s capital structure is debt finance. Details are as follows: Unit: Million Baht Type of Liabilities Short term loan from financial institutions Short term loan from major shareholders Long term loan from financial institution* Long term debenture* Other* Total interest bearing liabilities

31 December 2009

31 December 2008

1,756

2,062

552

354

3,261

2,333

4 5,573

352 16 5,117

*Includes the current portion of these facilities

Dividend Policy The Company’s Board of Directors Meeting No. 2/2009 held on 2 March 2009 passed a resolution to amend the Company’s dividend policy. The amended policy is as follows: “The Company's dividend policy requires that a dividend in the form of cash shall be paid of no more than 50 percent of net profit after tax and legal reserve when the Company has retained earnings and there is no accumulated loss.” The dividend policy of the Company’s subsidiaries is subject to the resolution of the shareholders meeting at each subsidiary.

Management Management Structure of Raimon Land Public Company Limited in 2009:

Board of Directors

Audit Committee

Executive Committee

Internal Auditor

Chief Executive Officer

Mr. Hubert Romary Bertrand Viriot

Chief Operating Officer Mr. Kitti Tungsriwong

VP, Corporate Finance

VP, Customer Relations Management

VP, Project Development

VP, Special Project

Ms. Lamai Pittrakul

Mrs. Neerja Sachdev

Mr. Gerard Conor Healy

Mr. Montri Hemvichitr

VP, Sales & Resort Management

VP, Human Resources

VP, Planning & Investment

Mr. Stephen Anthony Brajak

Mrs. Haruthai Yamanaka

Ms. Janjira Panitpon

Note: VP = Vice President.

Board of Directors The Board of Directors of Raimon Land Plc. (as at 31 March 2010) comprises nine Directors as follows: 1. Mr. Sompoch Intranukul 2. Mr. Talal J M A Al Bahar 3. Mr. Werner Johannes Burger 4. Mr. Hubert Romary Bertrand Viriot(1) (2)

5. Mr. Michael Burns Neilson (3) 6. Mr. Ibrahim S A Al-Therban 7. Mr. Kitti Tungsriwong 8. Mr. Kitti Gajanandana 9. Mr. Jirawud Kuvanant

Chairman of the Board of Directors, Independent Director and Audit Committee Member Director and Chairman of the Executive Committee Director and Executive Committee Member Director, Executive Committee Member and Chief Executive Officer Director Director Director, Executive Committee Member and Corporate Secretary Director, Independent Director and Chairman of the Audit Committee Director, Independent Director and Audit Committee Member

Attendance at Board of Directors Meetings in 2009 There were six Board of Directors meetings in 2009. The table below gives the attendance details: Number of Attendances

Name 1) Mr. Sompoch Intranukul 2) Mr. Talal J M A Al Bahar 3) Mr. Werner Johannes Burger 4) Mr. Hubert Romary Bertrand Viriot 5) 6) 7) 8)

Mr. Michael Burns Neilson (3) Mr. Ibrahim S A Al-Therban (4) Mr. Abdulwahub A S A S KH Al-Nakib Mr. Kitti Tungsriwong

9) Mr. Kitti Gajanandana 10) Mr. Jirawud Kuvanant (1) 11) Mr. Nigel John Cornick

(2)

(1)

Number of Absences

6 2

6 4

6 6 6 -

6 1

(1)

Mr. Hubert Romary Bertrand Viriot was appointed as Executive Committee Member and Chief Executive Officer in accordance with the resolution of the Board of Directors Meeting No 2/2009 on 2 March 2009 to replace Mr. Nigel John Cornick who resigned as Director, Executive Committee Member and Chief Executive Officer on 2 March 2009.

(2)

Mr. Michael Burns Neilson was appointed as Director in accordance with the resolution of the Board of Directors Meeting No. 5/2552 on 11 August 2009 to replace Mr. Andrew John Watson who resigned as Director on 11 August 2009.

(3)

Mr. Ibrahim S A Al-Therban was appointed as Director in accordance with the resolution of the Board of Directors Meeting No. 5/2552 on 11 August 2009 to replace Mr. Richard Anthony Johnson who resigned as Director on 11 August 2009.

(4)

Mr. Abdulwahub A S A S KH Al-Nakib was appointed as Director to replace Mr. Rahul Ghai who resigned as Director on 11 August 2009, and the resolution of the Board of Directors Meeting No. 2/2010 on 2 March 2010 acknowledge the resignation from the directorship of Mr. Abdulwahab A S A S KH Al-Nakib, effective from 1 March 2010.

Director authorisation and restrictions The signatures of two of the following six directors: Mr. Kitti Tungsriwong, Mr. Hubert Romary Bertrand Viriot, Mr. Werner Johannes Burger, Mr. Talal J M A Al Bahar, Mr. Michael Burns Neilson, or Mr. Ibrahim S A Al-Therban, with the official company seal affixed. Scope of authority of the Company’s Board of Directors The Company’s directors are required to perform their duties in compliance with all relevant laws and regulations as well as with the Company’s objectives and articles of association and the resolutions of shareholders meetings in good faith. The Company’s directors are prohibited from carrying out any business of the same nature as and in competition with the Company’s business and from being partners or shareholders or directors of other juristic persons carrying out a similar and competitive business, unless the shareholders are informed of such in a shareholders meeting prior to his/her appointment. If a director has direct or indirect interests in any agreements to be entered into with the Company or increases or decreases his/her shareholding or debenture holding in the Company and its affiliates or debenture, the director must inform the Company without delay. Executive Committee Members of the Executive Committee 1. Mr. Talal J M A Al Bahar 2. Mr. Werner Johannes Burger 3. Mr. Hubert Romary Bertrand Viriot 4. Mr. Kitti Tungsriwong

Chairman of the Executive Committee Executive Committee Member Executive Committee Member Executive Committee Member

Scope of authority, duties and responsibilities of the Executive Committee 1.

To manage the Company in all respects on a day-to-day basis;

To decide management emphasis and to draw up company policies, business plans, budget and administrative structure;

To submit suggested operational guidelines responsive to change in economic conditions to the Board of Directors for consideration; and

To review the Company’s operating results and monitor the operations undertaken in accordance with policy.

The Executive Committee has no authority to approve any transactions that may create a conflict of interest or approve any transactions that would benefit a member of the Executive Committee or connected person or which could conflict with the Company or its subsidiaries under Stock Exchange of Thailand regulations. Such transactions must be submitted to the Company Board of Directors and/or shareholders’ meeting for approval, as required by the Company’s Articles of Association and relevant laws. Audit Committee Members of the Audit Committee 1. 2. 3.

Mr. Kitti Gajanandana Mr. Jirawud Kuvanant Mr. Sompoch Intranukul

Chairman of the Audit Committee Audit Committee Member Audit Committee Member (Member with accounting background)

Scope of authority, duties and responsibilities of the Audit Committee

To perform joint evaluations with the auditor and/or management to ensure efficiency and adequacy of the internal control system and the standards of the internal audit system.

To review the Company’s financial statements to ensure that it maintains accurate financial reports and provides for adequate disclosure prior to submission to the regulators.

To review the Company‘s compliance with all laws pertaining to its business and the regulations of the Securities and Exchange Commission and the Stock Exchange of Thailand.

To disclose adequately and accurately all information pertaining to connected transactions or transactions that may have a conflict of interest as required by rules and regulations.

To prepare the Audit Committee Report to be published in the company’s annual report and to give an opinion on the procedures for preparing and disclosing information in financial reports as well as the company’s internal control system, to be signed by the Chairman of the Audit Committee.

To propose a list of auditors to the Board of Directors together with suggested remuneration each year for appointment by the Annual General Meeting of Shareholders and to review and evaluate the auditors’ performance.

To report to the Board of Directors on the work carried out by the Audit Committee at least once each quarter.

To give a joint opinion during the consideration of the appointment, dismissal, performance and remuneration of the internal auditor.

To perform any other tasks as assigned by the Board of Directors and agreed by the Audit Committee.

The term of an Audit Committee member is two years. In the case of vacancy due to any reason other than expiration of the term, the Companyâ&#x20AC;&#x2122;s Board of Directors is to appoint a qualified person to be an Audit Committee Member. The replacement will then complete the remaining term of the replaced member of the Audit Committee. Management Team Company management 1)

Mr. Hubert Romary Bertrand Viriot

Mr. Kitti Tungsriwong

3) 4)

Miss Lamai Pittrakul Mr. Stephen Anthony Brachak

Mr. Gerard Conor Healy

6) 7)

Mr. Montri Hemvichitr Mrs. Neerja Sachdev

8) 9)

Mrs. Haruthai Yamanaka Miss Janjira Panitpon

Director, Executive Committee Member and Chief Executive Officer Director, Executive Committee Member and Chief Operating Officer Vice President, Corporate Finance Vice President, Sales & Resort Management Vice President, Project Development Vice President, Special Project Vice President, Customer Relations Management Vice President, Human Resources Vice President, Planning & Investment

Scope of authority of the Chief Executive Officer According to the resolution of the Board of Directors of Raimon Land Plc. at the 9/2006 Shareholders Meeting held on 11 August 2006, the Chief Executive Officer has the following scope of authority: The Chief Executive Officer is authorised to carry out normal business practices in approving the investment budget, operating expenses, purchase of fixed assets, sale of inventory and other operations including delegating administrative authority to the responsible persons at a lower level as approved by the Board of Directors. This administrative power and delegation will not include the administration and authorisation which gives the power to the Chief Executive Officer and the authorised person to approve any transactions in which the Chief Executive Officer and the authorised person or possible person may have a conflict of interest with the Company and/or its subsidiaries.

Selection of Directors and Executives Selection of directors An appointment of directors must be approved by the general shareholders’ meeting except when the appointment is made necessary by any reason other than expiration of term. In that case, the Board of Directors will appoint a person to fill the vacancy. The replacement may only serve the remaining term of replaced director. The selection of directors does not require a nominating committee process. The Board of Directors has the responsibility of selecting an individual who is qualified, knowledgeable, capable, and experienced in relevant fields. In addition, the person will have no prohibited traits as defined in the Public Companies Act and notifications of the Securities and Exchange Commission. The requirements and procedures for selection of company directors are given below. According to Section 4 of the Company’s Articles of Association, the Board of Directors comprises at least five directors and at least half of the directors must reside in Thailand. The appointment of directors must be carried out at the shareholders’ meeting in accordance with the following requirements and procedures: 1.

Each shareholder has one vote to one share.

In appointing directors, each shareholder may exercise the votes to elect one or more candidates to be the director(s) and the voting requirement in item 1 above must apply. However, the votes are indivisible (the voting for appointment of directors shall be noncumulative voting).

The directors will be selected based on the total number of votes; in the case of a tie, the Chairman will cast the deciding vote.

At every Annual General Shareholders’ Meeting, one third of the directors - or the number nearest to one-third - must retire from the board. The retiring directors may be re-elected.

There must be drawing by lots to determine the directors retiring by rotation on the first and second years following a conversion into a public company. In each subsequent year, the directors who have been directors for the longest period must retire. In addition to retirement by rotation, a director vacates from the post upon: a. Death b. Resignation c. Disqualifications or possessing prohibited traits according to the Public Companies Act d. Removal by a resolution of the shareholders at the general shareholders’ meeting

e. Dismissal by a court order 6.

Any director wishing to resign is required to submit a resignation letter to the Company. The resignation is effective immediately upon the letter being received by Company. The director may notify the registrar of the resignation.

Selection of independent directors The Company realises the importance of independent directors, who are in charge of auditing and supervising the transparency and the performance of the Executive Committee under appropriate internal control systems, laws and regulations of relevant regulators as well as improving the Company’s operational efficiency. An independent director must be knowledgeable, competent and experienced. Independent directors are selected according to criteria set by the Company, which has a committee set up by the Board of Directors to submit a short-list of candidates to the Board for consideration. Once approved, the selections are proposed to the shareholders for approval at a shareholders’ meeting, as outlined in the Company’s Articles of Association. To qualify as an independent director, an individual must meet the following criteria: 1.

Hold less than one percent of the Company’s total voting shares;

Have no involvement in Company management, nor be an employee or a consultant on the Company’s payroll, nor have power to exert control over the Company, its affiliates, associated companies or connected persons. The individual may not possess a potential conflict of interest for at least two years prior to appointment. In addition, an independent director must not have any juristic relationship with the legal consultant or external auditor of the Company or its affiliates;

Have no involvement in any business relationship in terms of finance and management with the Company, affiliates, joint ventures or connected persons of an amount equal to or more than three percent of total net tangible assets. This includes relationships as a customer, a supplier, a trade creditor/debtor, or a financial creditor/debtor without receiving benefits from the Company; and

Have no family relationships with management, major shareholders of the Company or its affiliates and associated companies or be someone who may create a conflict of interest; and not be appointed to represent interests of particular directors or major shareholders.

Management Remuneration Monetary Remuneration Directorsâ&#x20AC;&#x2122; remuneration

Name 1)

Mr. Sompoch Intranukul

Mr. Kitti Gajanandana

Remuneration in 2009 (Baht) 1,020,000 480,000 1,500,000

Total

Managementâ&#x20AC;&#x2122;s remuneration

Type of Remuneration

Remuneration in 2009 (Baht)

Salary & tax paid on behalf and insurance premiums Contribution to provident fund Others Total

35,035,000 1,691,750 4,417,030 41,143,780

Supervision of Corporate Governance: Principles and Policies Raimon Land Plc has set out policies for corporate governance that adhere to the Principles of Good Corporate Governance for Listed Companies promulgated by the Stock Exchange of Thailand. The Company ensures transparency, integrity and accountability in line with international standards through an Audit Committee with three qualified individuals who are tasked with the independent auditing and monitoring of the performance of the Board of Directors. To further ensure good corporate governance, it appointed an internal auditor at the end of 2003 to improve the supervision. The Audit Committee and internal auditor are structured in a way that ensures their independence from the Companyâ&#x20AC;&#x2122;s Executive Committee. The Board has committed itself to compliance with the Code of Best Practice for Directors of Listed Companies and the five principles of Good Corporate Governance 2003 as follows:

Rights of shareholders

The Board of Directors holds that good corporate governance is vital both for its business operations and its investors and thus has set up policies and procedures to ensure transparency under relevant laws and business ethics for its business operations bearing in mind the best interests of shareholders and preventing conflicts of interest, exerting appropriate risk management, and having proper internal control systems in place as well as having an internal audit system reviewed by Independent Directors/Audit Committee Members.

The Company discloses up-to-date information to the public via its corporate profile, corporate website and company newsletter, all of which are in both English and Thai. Shareholders are notified at least seven days in advance of each shareholders meeting in a letter that specifies the date, time and venue of the meeting, as well as a detailed agenda. The Board of Directors’ opinion is provided on each item on the agenda in order to ensure shareholders receive adequate and timely information for decision-making at each meeting.

The Company has fully complied with the right of shareholders to access information and the Company is open to receiving comments and ideas from shareholders. The Company arranges for representatives of the Executive Committee, management, the Audit Committee and auditors to attend each meeting. Complete and accurate minutes are taken at each meeting and shareholders are given access to the minutes, a copy of which is filed with the Stock Exchange of Thailand within 14 days following the meeting. The minutes of the last meeting will be presented to shareholders for acceptance at the next meeting.

Equitable treatment of shareholders

All shareholders have equal rights to attend and vote at meetings as specified in the Articles of Association. Should a shareholder be unable to attend a meeting, the shareholder is encouraged to appoint a proxy to attend the meeting or assign an independent director to voice his/her opinions. All shareholders are treated equally with respect to their rights.

The Chairman at the shareholders’ meeting provides shareholders an opportunity during the meeting to express opinions and ask questions related to the agenda items or the Company as a whole.

The Board of Directors provides an opportunity shareholders to elect directors on an individual basis.

The Board of Directors uses voting cards for important agenda items such as election of directors, related party transactions, acquisitions or disposals of core assets, etc.

for

Role of stakeholders

The Company values the rights of all stakeholders who are involved with it, e.g., employees, management, suppliers, creditors, joint venture partners, and auditors, as well as the community and government sector. Upon the occurrence of events that concern the right of those parties, the Company will take into account fair treatments of all parties concerned within the scope of the law and regulations of relevant regulators.

The Board of Directors has established clear policies on fair treatment to each group of stakeholders for implementation and measurement of policy effectiveness in order to prevent any infringement of stakeholder rights and to redress violations of stakeholders’ legal rights.

Disclosure and transparency

The Company recognises the importance of accurate, complete, transparent and timely disclosure of financial reporting, general information and other information that may affect the price of the Company’s securities. Although there is no Investors Relation Unit, the Finance Department has been assigned to handle communication with investors and analysts with an emphasis on complete, transparent and timely disclosures.

The Company’s Board of Directors is responsible for the accuracy of the Company’s and its subsidiaries’ consolidated financial statements and related information as shown in the annual reports, which are prepared in accordance with generally accepted Thai accounting principles. Conservative judgments and best estimates have been used to prepare the financial statements to ensure adequate and proper disclosure in the notes to the financial statements.

The Company’s Board of Directors has arranged for an efficient internal control system to ensure that financial information is recorded accurately, completely and adequately in order to maintain the Company’s assets and to help identify deficiencies to enable preventive measures in relation to fraud and material operation irregularities.

The Company’s Board of Directors is satisfied with the overall effectiveness of its internal control system and that it ensures the reliability of the financial statements of the Company and its subsidiaries as at 31 December 2009.

The Company determines directors’ remuneration clearly, transparently and appropriately by comparison with other companies in the same industry. Directors’ remuneration is approved by shareholders at the general meeting and management remuneration is discussed and approved by the Board of Directors or the Executive Committee, which will take into account the Company’s operating results and achievements of management.

Responsibilities of the Board of Directors Â&#x192;

The Board of Directors of the Company consists of nine directors as follows: Executive Directors Non-Executive Directors Independent Directors

4 2 3

There are three independent directors, Chairman of the Audit Committee, and two audit committee members, representing at least one-third of the Board of Directors, which is considered appropriate. The Independent Directors/Audit Committee members are encouraged to express their views and maintain an independent review of the operations and transactions and are also involved in evaluating audit and internal control systems. The Company has made a clear outline defining the authority and responsibility of its Board of Directors, Executive Committee, Audit Committee and the Chief Executive Officer. The Chairman of the Board of Directors also acts as an independent director and has no relationship with management nor is a representative of major shareholders or the same person as the Chief Executive Officer. Â&#x192;

Raimon Land's directors perform their duties in the best interests of the Company, all stakeholders and shareholders as detailed below: a)

Review and approve key business matters such as the vision and mission, strategy, financial targets, risks and company master plan.

Monitor implementation by management to ensure efficiency and effectiveness.

Set and approve a written corporate governance policy and review the policy to ensure consistency at least annually.

Ensure that an internal control system and financial control is consistent with policy control and review the system at least annually.

Supervision of the Use of Inside Information The Company is conscious of the importance of protecting sensitive internal information. It has established policies and procedures to supervise management with regard to the misuse of inside information for their own benefit, and will take legal action against any individual who misuses inside information to the extent of criminal prosecution. The Company also limits the access to such information by management and officers to the extent possible. The Company ensures that relevant management and officers adhere to the restrictions on trading the Companyâ&#x20AC;&#x2122;s shares using inside information and/or forbids any inappropriate use of information in case the Company enters into a transaction which may have impact on security price. The management and officers are fully aware that they must not trade the

Companyâ&#x20AC;&#x2122;s securities or cause others to trade on non-public information. Such information must not be disclosed to any other party prior to notification to the Stock Exchange of Thailand. In addition, the Company requires management to report any changes in their holdings in the Companyâ&#x20AC;&#x2122;s securities to the Securities and Exchange Commission, as outlined in Section 59 of Securities and Exchange Act B.E. 2535. An executive is required to provide a copy of the report to the Company on the date that the executive reports it to the Securities and Exchange Commission.

Employees Number of employees As at 31 December, 2009, the Company had 105 employees, excluding nine executives. The number of the employees in each function is as follows: Department 1) 2) 3) 4) 5) 6) 7) 8) 9) 10) 11) 12) 13) 14)

Office of Executives Finance & Accounting Human Resources Transfer & Purchasing Administration Research & Development Project Development Customer Relations Management Marketing Special Projects Sales Information Technology Legal Customer Relations Management (Phuket Total

No. of employees 5 15 4 3 9 4 8 16 4 6 24 3 1 3 105

Employee remuneration

Type of remuneration

Remuneration in 2009 (Baht)

Salary, overtime Bonus Commission Provident fund Severance pay Others Total

67,173,815 6,730,050 4,686,821 2,900,451 28,064,198 7,813,415 117,368,750

Note: Information provided on accrual basis, including remuneration paid by the Company and its subsidiaries.

Internal Control The Company believes that internal control is vital, and has emphasised the implementation of an internal control system suitable for its type of business. For the same reasons, the Company appointed an internal auditor to supervise all aspects of its operations. The internal auditorâ&#x20AC;&#x2122;s responsibilities are: 1)

To review and report on the reliability and completeness of financial statements, operations and procedures used in judgments and measurements;

To review the work system, which has a material impact on business operations, and to report whether corporate policies, plans and relevant regulations including laws have been fully complied with;

To review the appropriateness of assets storage and ensure their wellbeing;

To evaluate use of Company resources in terms of effectiveness and efficiency;

To review operations and plans to ensure consistency with the established objectives, goals and undertakings of the operations planned;

To prepare an internal audit report for submission to the Audit Committee that includes a report detailing deficiencies and possible corrective measures for internal control and accounting methods. The internal auditor will report to the Company and advise on improvements, as well as consult with the responsible officer and report on the conclusions to the Company;

To review the Companyâ&#x20AC;&#x2122;s operations and compliance with relevant regulations of the Stock Exchange of Thailand, the Securities and Exchange Commission and the Public Companies Act; and

To act as a secretary to the Audit Committee.

Upon completion of auditing work, the internal auditor will prepare an internal audit report, then discuss the results of the findings with the Audit Committee, the external auditor and Company management, suggesting improvements for a better internal control system. In 2009, four Audit Committee meetings were convened to review corporate governance, quarterly financial statements and annual financial statements, including the disclosure of notes to financial statements, and discuss any problems that occurred as well as preventive and corrective measures that could be taken. The Audit Committee views that the financial reporting over the past year complies with generally accepted accounting principles and that the disclosure of information, internal control and internal audit systems were adequate and in compliance with all key legal requirements and relevant regulations. Additionally, the Company has undertaken corrective measures recommended by the internal auditor and the Audit Committee to ensure good corporate governance and the best interests of its shareholders. The Board of Directors plans to develop five major aspects of its internal control system: organisation and environment, risk management, supervision of managementâ&#x20AC;&#x2122;s operations, information technology and communication systems and the assessment system, to ensure prudence and compliance with the internal control requirements of the Stock Exchange of Thailand and the Office of the Securities and Exchange Commission, the Public Companies Act and other relevant regulations. The Company also adheres to the practice of complete and accurate disclosure of information to shareholders, the Stock Exchange of Thailand and the Office of the Securities and Exchange Commission and relevant authorities. The Company has developed its ethical standards while in the process of preparing its authorisation manual and operation procedures relating to major work systems for further submission to the Board of Directors for consideration and approval. Additionally, the Company is ensuring that it maintains an effective risk management system which is appropriate for its operations.

Details of executive officers and persons in control of the Company as at March 2010

No.

Name

Mr. Sompoch Intranukul

Age

Education

Shareholding Proportion (%)

Work experience in last 5 years

Familyâ&#x20AC;&#x2122;s relationship with management

Period

2002 - Present

Position

Company / Type of Business

Chairman of the

Raimon Land Plc.

Commerce and Accounting,

(RAIMON)

Board of Directors/

- Property development

Chulalongkorn University

None

Independent

Bachelor Degree, Faculty of

- Ordinary Shares

Director/ Audit Committee

Senior Executive Program,

Member

Sasin Graduate Institute of Business Administration of

2003 - Present

Chairman

Certificate, National Defense

1999 - Present

College Directors

SCMB Co., Ltd. - Financial advisory services

Chulalongkorn University

1999 - Present

Certification Program

Chairman of Audit

Siam Commercial Leasing Plc.

Committee

- Financial services

Chairman of Audit

Subsrithai Warehouse Co.,Ltd.

Committee

- Warehouse

Chairman of Audit

Dheves Insurance Plc.

Committee

- Insurance

Chairman

Siam Administrative Management

(DCP 24/2002) 1999 - Present

1995 - Present

Co., Ltd. - Administrative services

50 Details of executive officers and persons in control of the Company as at March 2010 (Cont’d)

No.

Name

Mr. Talal J M A Al Bahar (Authorised Director)

Age

Education

Shareholding Proportion (%)

Work experience in last 5 years

Family’s relationship with management

Period

Position

2006 - Present

Company / Type of Business

Director/ Chairman

Raimon Land Plc.

Loyola Marymount, Los Angeles,

(RAIMON)

of the Executive

- Property development

USA

None

Committee

Bachelor Degree in Business Studies, - Ordinary Shares

Vice Chairman/

IFA Hotels & Resorts Ltd.

CEO

- Property development

2009 - Present

Director

Taksin Hotel Holding Co., Ltd. (1)

2009 - Present

Director

2009 - Present

Director

2008 - Present

Director

2008 - Present

Director

2007 - Present

Director

2007 - Present

Director

2007 - Present

- Property development Taksin Properties Co., Ltd. (1) - Property development Wireless One Residences Co., Ltd. (1) - Property development Raimon Land Residences Co., Ltd. (2) - Property development Ploenchit Residences, Co., Ltd. (2) - Property development Contemporary Property Co., Ltd. (1) - Property development Raimon Land Park View Development Co., Ltd. (1) - Property development 2007 - Present

Director

2007 - Present

Director

2007 - Present

Director

2005 – Present

Partner/

Raimon Land Property Co., Ltd. (1) - Property development Raimon Land Development Co., Ltd (2) - Property development Raimon Land Planner Co., Ltd. (1) - Business reorganisation Druke & Scull

Executive Director

- Construction consultant

2005 - 2006

Chairman/

IFA Hotels& Resorts Ltd.

Managing Director

- Property

2003 -2005

Chairman/

Kuwait Invest Holding Company

2002 - Present

Managing Director

- Investment

General Manager

United Investments Portugal (UIP) - Financial advisory services

Note: (1) Raimon Land’s subsidiaries

(2) Jointly controlled entities

Details of executive officers and persons in control of the Company as at March 2010 (Cont’d)

No.

Name

Mr. Werner Johannes Burger (Authorised Director)

Age

Education

Bachelor of Science in Building Management, University of Pretoria Pretoria, South Africa

Shareholding Proportion (%) - Ordinary Shares (RAIMON) None

Work experience in last 5 years

Family’s relationship with management

Period

Position

2006 - Present

Director/ Executive Committee Member

2005 - Present

President/ COO

2010- Present

Director

2008- Present

Director

2009 –Present

Director

2009 - Present

Director

2009 - Present

Director

Company / Type of Business Raimon Land Plc. - Property development IFA Hotels& Resorts Ltd. - Property development Ploenchit Management, Co., Ltd. (2) - Property development and/or investment Raimon Land Residences Co., Ltd. (2) - Property development Ploenchit Residences, Co., Ltd. (2) - Property development Raimon Land Planner Co., Ltd. (1) - Business reorganisation Raimon Land Park View Development Co., Ltd. (1) - Property development

2009 – Present

Director

2009 – Present

Director

2009 – Present

Director

2009 - Present

Director

2009 – Present

Director

2009 - Present

Director

Raimon Land Property Co., Ltd. (1) - Property development Raimon Land Development Co., Ltd (2) - Property development Taksin Hotel Holding Co., Ltd. (1) - Property development Taksin Properties Co., Ltd. (1) - Property development Contemporary Property Co., Ltd. (1) - Property development Wireless One Residences Co., Ltd. (1) - Property development

2003 - 2005

VP, Sales & Marketing

IFA Hotels& Resorts Ltd. - Property development

2002 - 2003

VP, Sales & Marketing

DAMAC Properties, Dubai - Property development

Notes: (1) Raimon Land’s subsidiaries

(2) Jointly controlled entities

52 Details of executive officers and persons in control of the Company as at March 2010 (Cont’d)

No.

Name

Age

Education

Shareholding

Family’s

Proportion

relationship with

(%)

management

Period

Position

2006 - Present

Work experiences in last 5 years Company / Type of Business

Director/ Executive

Raimon Land Plc.

Bertrand Viriot

International Hospitality and

(RAIMON)

Committee Member/

- Property development

(Authorised Director)

Management, University of Wales

None

CEO

Mr. Hubert Romary

Bachelor of Science in

- Ordinary Shares

Director

2009 - Present

Director

2009 - Present

Director

2009 - Present

Director

2009 - Present

Director

2008 - Present

Director

2008 - Present

Director

2007 - Present

Director

Contemporary Property Co., Ltd.(1)

2007 - Present

Director

Raimon Land Park View

Bachelor Degree in Hospitality and Tourism Management,

Ploenchit Management Co., Ltd.(2)

2010 - Present

- Property development and/or investment

Glion Hotel School, Switzerland

Wireless One Residences Co., Ltd.(1) - Property development Raimon Land Resorts Co., Ltd.(1) - Investment and Service Taksin Hotel Holding Co., Ltd.(1) - Property development Taksin Properties Co., Ltd.(1) - Property development Raimon Land Residences Co., Ltd. (2) - Property development Ploenchit Residences, Co., Ltd. (2) - Property development - Property development Development Co., Ltd.(1) -Property development

2007 – Present

Director

Raimon Land Property Co., Ltd. (1)

2007 - Present

Director

Raimon Land Development Co., Ltd (2)

2007 - Present

Director

2005 - Present

Assistant Vice

IFA Hotels & Resorts Ltd.

President

- Property development

Head-Consulting

HVS International, Singapore

& Investment

- Hospitality service

- Property development -Property development Raimon Land Planner Co., Ltd. (1) - Business reorganization

2001 - 2005

Services, Asia Notes: (1) Raimon Land’s subsidiaries

(2) Jointly controlled entities

Details of executive officers and persons in control of the Company as at March 2010 (Cont’d)

No.

Name

Mr. Michael Burns Neilson(3)

Age

Education

Bachelor Degree in Accounting Fellow of the Chartered Association of Certified Accountants

Mr. Ibrahim S A Al-Therban(4)

Bachelor of Commerce

Shareholding Proportion (%)

- Ordinary Shares (RAIMON) None

Work experience in last 5 years

Family’s relationship with management

Period

2009 - Present

Position

Company / Type of Business

Director

Raimon Land Plc. - Property development

2007 - 2008

COO/ Managing Director

Cazenove Capital Management - Securities

2000 - 2007

Chief Financial Officer

Cazenove Capital Management - Securities

2009 – Present

Director

Raimon Land Plc. - Property development

2008 - Present

Chairman

IFA Hotels & Resorts Ltd. - Property development

2008 - Present

Vice Chairman & Managing Director

Kuwait Real Estate Co., Ltd. - Property development

2004 - Present

Director

International Financial Advisors - Investment Advisory Services

Chairman/Managing Director

Kuwait Real Estate Co., Ltd. - Property development

1997 - 2008

Notes: (3) Mr. Michael Burns Neilson was appointed as Director in accordance with the resolution of the Board of Directors Meeting No. 5/2552 on 11 August 2009 to replace Mr. Andrew John Watson who resigned as Director on 11 August 2009. (4) Mr. Ibrahim S A Al-Therban was appointed as Director in accordance with the resolution of the Board of Directors Meeting No. 5/2552 on 11 August 2009 to replace Mr. Richard Anthony Johnson who resigned as Director on 11 August 2009.

54 Details of executive officers and persons in control of the Company as at March 2010 (Cont’d)

Name

Age

Education

No.

Mr. Kitti Tungsriwong (Authorised Director)

Master Degree in Real Estate Business, Faculty of Commerce and Accountancy, Thammasat University Bachelor Degree in Accounting, The University of the Thai Chamber of Commerce Directors Certification Program (DCP 43/2004)

Shareholding Proportion (%)

- Ordinary Shares (RAIMON) 866,960 units

Family’s relationship with management

Work experience in last 5 years

Period

Position

2004 - Present

2010 - Present

Director/ Executive Director/ COO/ Corporate Secretary Director

2008 - Present

Director

2008 - Present

Director

2007 - Present

Director

2007 - Present

Director

2007 - Present

Director

2006 - Present

Director

2006 - Present

Director

2006 - Present

Director

2005 - Present

Director

2005 - Present

Director

2004 - Present

Director

2003 - 2004 1998 – 2002

Notes: (1) Raimon Land’s subsidiaries

(2) Jointly controlled entities

Director/ SVP, Finance Senior Consultant

Company / Type of Business

Raimon Land Plc. - Property development Ploenchit Management (2) - Property development and/or investment Wireless One Residences Co., Ltd (1) - Property development Raimon Land Residences Co., Ltd.(2) - Property development Ploenchit Residences, Co., Ltd. (2) - Property development Raimon Land Planner Co., Ltd. (1) - Business reorganisation Raimon Land Resorts Co., Ltd. (1) - Investment and service Raimon Land Park View Development Co., Ltd. (1) - Property development Raimon Land Property Co., Ltd. (1) - Property development Raimon Land Development Co., Ltd (2) - Property development Taksin Hotel Holding Co., Ltd. (1) - Property development Taksin Properties Co., Ltd. (1) - Property development Contemporary Property Co., Ltd. (1) - Property development Raimon Land Plc. - Property development Price Waterhouse Cooper F.A.S Co., Ltd. - Financial advisory services

Details of executive officers and persons in control of the Company as at March 2010 (Cont’d)

No.

Name

Mr. Kitti Gajanandana

Age

Education

Master Degree in Business

Shareholding Proportion (%)

- Ordinary Shares

Work experience in last 5 years

Family’s relationship with management

Period

2004 - Present

Position Independent

Raimon Land Plc. - Property business

Administration (MBA),

(RAIMON)

Director/ Chairman of

North Texas State University

None

the Audit Committee 2004 - Present

Bachelor Degree, Faculty of Commerce and Accounting,

Company / Type of Business

Director/ Audit

CINMIT Company Limited

Committee

- Financing advisory services

Advisor

Fiscal Policy Research Institute

Chulalongkorn University 2001 - Present

- Research and consulting business 1999 – 2000

Mr. Jirawud Kuvanant

Master Degree (MBA), The College of - Ordinary Shares Insurance, New York City, U.S.A.

2003 - Present

(RAIMON)

Executive Vice

Bank Thai Plc.

President

- Banking

Independent Director/

Raimon Land Plc.

Audit Committee

- Property development

Independent Director

Raimon Land Plc.

None 2002 - Present

Bachelor Degree in Business

- Property development

Administration, Major in Marketing, Thammasat University 1987 - Present

Executive Director

Kowyuha Motor Group - Automobile

Directors Certification Program (DCP 43/2004)

Mr. Gerard Conor Healy

Bachelor Degree in Architecture

- Ordinary Shares

(B.Arch), University College Dublin,

(RAIMON)

Ireland

1,723,696 shares

2002 - Present

1996 - 2002

VP, Project

Raimon Land Plc.

Development

- Property development

Development &

Woods Bagot (Thailand) Co., Ltd.

Research Manager

- Design and decoration

56 Details of executive officers and persons in control of the Company as at March 2010 (Cont’d)

No.

Name

Ms. Lamai Pittrakul

Age

Education

Master Degree in Accounting,

Shareholding Proportion (%)

- Ordinary Shares

Faculty of Commerce and

(RAIMON)

Accountancy, Thammasat University

None

Work experience in last 5 years

Family’s relationship with management

Period

2008 - Present

2007 – 2008

Position

Company / Type of Business

VP, Corporate

Raimon Land Plc.

Finance

- Property development

Director of Finance

Major Development Plc. - Property development

Bachelor Degree in Accounting, Bangkok University 2001 – 2007

Director of Finance

Destination Properties Co., Ltd. - Hotel & property development

Mr. Montri Hemvichitr

Master Degree in Economics, Institute of Social Technology

- Ordinary Shares

2005 - Present

VP Special Project

Raimon Land Plc. - Property development

(RAIMON) 110,458 units 2000 - 2004

Bachelor Degree in Marketing,

Project Director

Raimon Land Plc. - Property development

Ramkhamhaeng University Certificate from the Advanced Marketing Program, Thammasat University Certificate in Social Research, NIDA

Mrs. Neerja Sachdev

Bachelor of Arts, Bombay University, - Ordinary Shares Bombay, India

2007 - Present

(RAIMON)

Raimon Land Plc.

Relations

- Property development

Management

None Diploma in Commercial Art

VP, Customer

2005 - 2007

Property Manager

CB Richard Ellis - Property

2003 - 2005

1994 - 2003

Assistant Property

CB Richard Ellis

Manager

- Property

House/Apartment

Orchid Tower

Manager

- Property

Details of executive officers and persons in control of the Company as at March 2010 (Cont’d)

No.

Name

Mrs. Haruthai Yamanaka

Age

Education

Master Degree in Business

Shareholding Proportion (%) - Ordinary Shares

Administration (MBA),

(RAIMON)

City University, USA

None

Work experience in last 5 years

Family’s relationship with management

Period

2007- Present

1996 - 2007 Bachelor Degree Faculty of

Position

Company / Type of Business

VP, Human

Raimon Land Plc.

Resources

- Property development

Human Resources

Banyan Tree Bangkok Hotel

Manager

- Hospitality

Humanities, Major in English, Chiang Mai University 15

Ms. Janjira Panitpon

Master degree in Business

- Ordinary Shares

Administration (MBA),

(RAIMON)

University of San Francisco

None

2008 - Present

2006 - 2008

VP, Planning &

Raimon Land

Investment

- Property development

VP Portfolio

Bangkok Capital Alliance Co., Ltd. - Assets management

Bachelor Degree of Business Administration, 2004 - 2006

Assumption University (ABAC)

AVP Portfolio

Bangkok Capital Alliance Co., Ltd. - Assets management

Mr. Stephen Anthony Brajak

Holy Spirit College, Belami (St Paul’s College)

- Ordinary Shares

2008 - Present

(RAIMON)

VP, Sales & Resort

Raimon Land Plc.

Management

- Property development

General Manager

Raimon Land Plc.

None Member of International

2006 - 2008

- Property development

Businessman’s Association of Phuket (IBAP) 2004 - 2006

Marketing and Sale

Tropical Life Co., Ltd.

Development

- Property development

Manager 2003 - 2004

Marketing and Sale

Nopawong Construction Co., Ltd.

Development

- Construction

Manager

58 Connected Transactions Summary of connected transactions in 2009: Notification Date 04/02/09

Connected Person

IFA Hotels & Resorts 3 Ltd. (IFA)

Raimon Land Plc. (RL)

24/03/09 and 07/04/09

24/03/09

IFA Hotels & Resorts 3 Ltd. (IFA)

Raimon Land Plc. (RL)

and 07/04/09

Relationship

IFA is RL’s major shareholder holding approximately 26.15% (41.08% on the report date) of RL’s total issued shares

Common directors of RL and IFA are as follows: (1)

Mr. Talal Al Bahar

(2)

Mr. Hubert Viriot

(3)

Mr. Werner Burger

IFA is RL’s major shareholder holding approximately 26.15% (41.08% on the report date) of RL’s total issued shares

Common directors of RL and IFA are as follows: (1) Mr. Talah Al Bahar (2) Mr. Hubert Viriot (3) Mr. Werner Burger

Nature of Transaction

Value of Transaction (Baht)

IFA provides financial assistance to RL by agreeing to extend loan repayment for one year commencing from 31 December 2008 and IFA agreed to charge an interest rate of not more than 15% per annum (RL is responsible for withholding tax payment).

356.61 million

IFA provides financial assistance to RL in terms of a short-term loan and IFA agrees to charge an interest rate of not more than 10% per annum (RL is responsible for withholding tax payment).

Not more than USD 10 million or approximately Baht 359 million

Opinions of the Board of Directors and Audit Committee

Remarks

Loan to RL for funding development of property project and using as working capital

RL is not required to give any collateral to secure the repayment of such loan.

Loan to RL for funding development of property project and using as working capital

RL is not required to give any collateral to secure the repayment of such loan.

The interest rate of not more than 15% (RL is responsible for withholding tax) to be paid to IFA is an appropriate rate. Given the prevailing economic situation, no financial institution will lend without requiring significant collateral, hence the condition offered by IFA is better than that of a typical financial institution.

The interest rate of not more than 10% (RL is responsible for withholding tax) to be paid to IFA is an appropriate rate. Given the prevailing economic situation, no financial institution will lend without requiring significant collateral, hence the condition offered by IFA is better than that of a typical financial institution.

Notification Date 11/08/09

16/11/09

Connected Person

Raimon Land Development Company Limited (RLD)

IFA Raimon Land Development Company Limited (IFA RLD)

Raimon Land Plc. (RL)

IFA Raimon Land Residences Company Limited (IFA RLR)

IFA Ploenchit Residences Company Limited (IFA PR)

Relationship

RL holds approximately 51% of the total shares in RLD

IFA RLD holds a 49% share in RLD. IFA RLD is an affiliate company of IFA, RL’s major shareholder, holding 41.08% of the total issued shares in RL

Common directors of RL, IFA, RLD are as follows: (1)

Mr. Talah Al Bahar

(2)

Mr. Hubert Viriot

(3)

Mr. Werner Burger

IFA RLR and IFA PR are affiliates of IFA, RL’s major shareholder, holding approximately 41.08% of RL’s total issued shares.

RL and IFA RLR hold approximately 51% and 49% of RLR’s total shares, respectively.

Raimon Land Company Limited (RL)

RLR and IFA PR hold approximately 51% and 49% of PR’s total shares, respectively.

Raimon Land Residences Company Limited (RLR)

Common directors of RL, IFA, RLR and PR are as follows:

Ploenchit Residences Company Limited (PR)

(1)

Mr. Talal Al Bahar

(2)

Mr. Hubert Viriot

(3)

Mr. Werner Burger

Nature of Transaction

Value of Transaction (Baht)

RL agreed to provide financial assistance with a long-term loan to RLD.

51 million

RL charges net interest of not more than 15% per annum (RLD is responsible for withholding tax payment).

23.2 million

IFA RLD agreed to provide financial assistance with a long-term loan to RLD.

IFA RLDcharges net interest of not more than 15% per annum (RLD is responsible for withholding tax payment).

PR is responsible for withholding tax payment for RL and IFA RLR.

RLD shall repay both principal and net interest on 10 August 2012 (the repayment shall be made after the loan repayment to financial institutions)

RLD is not required to give any collateral to secure the repayment of such loan.

PR agrees to pay withholding tax since RLR has to borrow from RL and IFA RLR in order to lend to PR for PR’s use as a property project development fund and as working capital.

49 million

25.4 million

70.9 million

Opinions of the Board of Directors and Audit Committee

Remarks

The interest rate of not more than 15% (RLD is responsible for withholding tax) to be paid to IFA RLD and RL is an appropriate rate. Given the prevailing economic situation, no financial institution will lend without requiring significant collateral and the loan has an interestfree period of three years, hence the condition offered by IFA RLD and RL is better than that of a typical financial institution.

Necessity and reasonableness of transactions In entering into such connected transactions, the Company considered that such transactions were necessary and reasonable. The transactions were carried out in the best interests of the Company and are generally in line with normal business practice. The relevant considerations, fees and commercial terms were based on the fair market price of like transactions between the Company and other non-related parties. There was no transfer of benefits between the Company and any person with a potential conflict of interest or interested party. The Companyâ&#x20AC;&#x2122;s Audit Committee acknowledged and agreed with the decision made and the action of the Board of Directors and/or management by taking into account the appropriateness of entering into all connected transactions in 2009. Measurement and procedures for approval of connected transactions The approval for connected transactions has fully complied with the Securities and Exchange Act, and regulations, notifications, orders and requirements of the Stock Exchange of Thailand. Any interested director or person who may have a conflict of interest with the Company in any particular transaction will not be allowed to participate in considering and approving the transaction, unless the nature of such conflict of interest is waived by the laws concerning Securities and Exchange Act, or regulations, notifications, orders or rules of the Stock Exchange of Thailand regarding Disclosure of Information and Other Acts of Listed Companies Concerning Connected Transactions B.E. 2546. Policy and tendency of future connected transactions In the future, the Company may enter into a connected transaction if such transaction will benefit the Company. The Company has set out policy for future connected transactions to be in line with normal commercial business practices with a fair market price which is comparable to the transactions between the Company and other non-related parties. The Company is determined to comply with the Securities and Exchange Act, and regulations, notifications, orders or requirements of the Stock Exchange of Thailand, including abiding by disclosure requirements of connected transactions and asset acquisition and disposition transactions. In addition, the Audit Committee shall attend the Board of Directors meeting held to consider the approval of any connected transaction, in order to give an opinion on the appropriateness of transaction price and reasonableness in entering into the transaction.

Risk Factors 1. Business Risks Risk of land acquisition for project development Raimon Land does not adopt the use of land bank policy for further development unless it is land which the Company foresees has a high potential for development and the price of which is at a level that provides a high investment return. Seeking and acquiring land in prime areas at reasonable prices is a key risk and a main factor in the success of the business operations of the Company. The Company mitigates the risk of acquiring land for project development by having an extensive network of brokers, directors and executives. This powerful network enables the Company to seek or acquire land in prime areas at reasonable prices. In addition, the Company minimises this risk by giving priority to the extensive market research and surveys. The market research and survey findings permit the Company to analyse the data and consider and mitigate the risk of land acquisition effectively. Risk of project development Since construction material price volatility affects project development cost, Raimon Land minimises the risk caused by this volatility by employing only one construction contractor and signing the contract as a turnkey construction contract, which permits Raimon Land to effectively control construction costs. In addition, in order to reduce costs, the Company purchases some construction materials directly from suppliers, such as steel and tiles. Moreover, in some cases, the Company reduces risk by proactively fixing the delivered price of construction materials, which has a direct impact on the costs of construction, in order to eliminate the volatility. In addition to the fluctuation of construction material costs, the shortfall in the number of qualified contractors is another problem in the Thai property market. This may impact project quality and the delivery schedule. The Company adheres to the following three guidelines in risk management: 1.

Raimon Land adopts a project development risk management review and audit system for every project, which includes strictly monitoring contractor selection guidelines, conducting performance tests of key materials (e.g., steel, windows, glass and bricks), seeking new technology, focusing on developing quality construction materials, and improving the construction management system to ensure optimisation of cost and negotiation of material prices to retain the same or better product quality. Most importantly, in hiring contractors, the Company enters into a fixed lump-sum price contract in order to reduce the risk of cost overrun. In some cases, the Company also makes advance payment, should opportunities arise. For cost savings or risk mitigation of cost increases.

Raimon Land manages project development risk by hiring consultants with capabilities, skills and expertise suited project. The criteria for selecting these consultants is based specific skills, resources, reputation, ability to apply

external to each on their modern

technology and materials for cost savings and improving the effectiveness of work and efficient and effective construction methods. The consultants suggest a list of contractors/suppliers for the Company’s selection. The project manager will then monitor the contractor as well as negotiate the costs. 3.

For every project, the Company will select the main contractor from leading international construction contractors. Contractors are chosen based on their ability to be solely accountable for a project’s management and construction, design coordination, their overall ability to sub-contract or co-ordinate, their financial, technical and organisational resources, staff competency, past experience, reputation, and reliability in delivering completed work on time and within budget.

Risk of sales The pace of sales at each project is extremely critical for a condominium developer like Raimon Land. Faster sales help lower the Company’s financial risk and other burdens. Also, this enables the Company to manage the project’s risk easier because projects with sluggish sales tend to cause a construction delay and lead to increased project costs and a declining net profit. The competitive environment of the premium property segment, the volatility of Thailand’s economic environment and political uncertainty also affect the sales pace of the Company’s projects. Raimon Land focuses on sales risk management by developing projects on prime sites, brand building, initiating new ideas in project development, understanding the market, and expanding its customer base. The Company believes that the right location is the most important factor in minimising sales risk. As a result, the Company has invested intensively in research and feasibility studies which include the assessment of project locations, market environment, competition, number of competitors, target customers, infrastructure and public transportation systems. Investment in the Company’s brand building is starting to pay off as the Company is being known as a major player in the premium residential market. Raimon Land projects are well accepted domestically and internationally as a result of the value delivered to customers which meets their expectations. Consequently, Raimon Land has a large number of repeat customers who perceive value in the Company’s projects both in terms of investment assets and as a residence. In addition, customer research has increased the Company’s understanding of its market and has been a foundation for its continuous project innovation. These are the two contributing factors that have helped the Company to mitigate the risk of competition and changes in its customer’s behaviour as the Company is able to adjust its business strategies to deal with the changing environment and create distinct and suitable products to meet its customers’ needs. The Company is also confident that the expansion of its customer base will help mitigate the risks arising from economic volatility both locally and internationally. In 2009, about 41% of the Company’s customers were international buyers from over 20 countries. This customer diversity is a result of the Company’s proactive marketing strategies both locally and internationally.

Risk of relevant regulatory changes The Company minimises risks from amendments in related government agencies’ acts, codes and regulations, e.g., city planning acts, building control acts, building design related ministerial regulations, open space ratios (OSR), floor area ratios (FAR), BMA codes, Land Department codes, Treasury Department codes, as well as regulations on environmental permits, particularly those regarding large and high-rise buildings, by closely monitoring amendments with the relevant government agencies as well as performing project feasibility studies and thoroughly and strictly abiding by acts, codes and regulations of the pertinent authority. Therefore, the Company is confident that its projects comply with relevant acts, codes and regulations strictly. Moreover, in project design, the Company also embraces innovation and technology which are environmentally friendly. Regarding other regulatory changes which might affect project development, namely the revocation of the real estate sector stimulus measure – the reduction of the special business tax and transfer fee – the Company has been prepared to cope with the end of the stimulus package. This should not affect the Company’s project development. 2. Financial Risks and Other Possible Risks Risk of obtaining funds for project development Normally, the nature of a condominium project requires substantial funding in the initial stage and the payback period is 3-5 years. Therefore, the Company’s ability to access a low-cost funding source is among the key factors in determining the project’s success, both from a profitability perspective and a liquidity perspective. In general, developers have three major funding sources: their own working capital, borrowing from financial institutions and instalments received from customers, which are down and transfer payments. Difficulty in obtaining funds usually arises from sluggish sales, instalment delinquency and lack of support from financial institutions. Raimon Land minimises the risk of sluggish sales by selecting good locations and developing quality projects by combining innovation and technology that take into account environmental impact. As a result, Raimon Land is recognised domestically and overseas. Raimon Land’s understanding of its customers also leads to the expansion of its customer base. The collection of down payments at the ratio of 30-40 percent of selling price, which is above the industry norm, helps mitigate risk from collection of instalments. In addition, Raimon Land has compiled customer classifications and received support from many local financial institutions. The Company believes it will continue to receive financial support as it has in the past. Raimon Land also has a strong relationship with investors and many private investment funds which give support to the Company for both funding and jointly investing in projects.

Risk of interest rate volatility Most of the Company’s borrowings bear a floating interest rate or MLR which moves with market conditions. Hence, interest rate volatility might impact the Company’s operating results and cash flows. Nevertheless, such interest rate volatility minimally impacts the Company’s operating results and cash flows and in 2010 the Company expects to witness very marginal changes in market interest rates. Risk of a major shareholder having control over resolutions at the shareholders meeting and over the Company’s management IFA Hotels & Resorts 3 Ltd. (IFA HR3), the Company’s major shareholder, held 41.08 percent of the Company’s issued and paid-up share capital as at 20 August 2009. As a consequence, IFA HR3 has held control over the Company’s management and the appointment of directors, as well as the majority of shareholder voting rights for resolutions which required majority ruling. However, IFA HR3 may not vote on the agenda in which it is a party with interest. For the benefit of transparency, the ability to be audited and checks and balances in its operations, the Company has appointed independent individuals to serve as the Company’s independent directors and audit committee members, complying with the good corporate governance principles of the Stock Exchange of Thailand. Risk of relying on the major shareholder for financial assistance At present, the Company receives financial assistance from IFA Hotels & Resorts 3 Ltd., the Company’s major shareholder. As at 31 December 2009, the Company had Baht 551.64 million in outstanding unsecured loans and accrued interest from IFA Hotels & Resorts 3 Ltd., representing 7.76 percent of total liabilities. Going forward, should the Company not receive such support, cash flow might be affected. However, in the past IFA Hotels & Resorts 3 Ltd. has constantly supported the Company, whether in granting additional loans or extending repayment periods for principal and interest. The Company is confident it will continue to receive such support in the future. Risk of providing financial assistance to subsidiaries and affiliates Raimon Land has provided financial support by way of loans and guarantees to its subsidiaries and affiliates, which may create a risk in terms of expenses or liabilities if those subsidiaries or affiliates fail to repay the debts. Nonetheless, the Company’s financial assistance is specifically granted to those entities which the Company has control over and manages. In order to minimise risk, the Company has strictly complied with the criteria outlined by the Stock Exchange of Thailand regarding connected transactions. That is, the Company will request the opinion of the audit committee and the approval of the Company’s Board of Directors and/or its shareholders’ meeting, if the matter meets the requirements set by the Stock Exchange of Thailand. Additionally, if the Company and/or its subsidiaries have any surplus liquidity, the Company and/or its subsidiaries will, by way of inter-company loans, manage to gain maximum returns and benefits to the group both directly and indirectly, given that the Company is their major shareholder.

Risk of the change of revenue recognition method At present, Raimon Land uses the Percentage of Completion Method for revenue recognition. The revenue recognition will trigger when each project has passed three tests: percentage of project area sold, percentage of collection from each customer, and percentage of construction completion. When the project has passed the first two tests, the revenue to be recognised depends on the construction progress. The new revenue recognition method which is being proposed will require the Company to recognise its income upon a transfer of ownership. If the accounting standard is imposed, the Company will not be able to recognise its revenue even though the Company has already received payments from the project. Such income recognition may have an impact on financial reporting. The shareholders should therefore monitor the change of this standard in the near future. However, this change will not affect the Companyâ&#x20AC;&#x2122;s cash flow recognition. Risk of the attrition of key personnel The real estate development business relies heavily on the knowledge and capabilities of personnel. To this end, the Company has selected and employed qualified and competent employees who have a high potential for advancement. The Company well recognises the importance of its personnel and constantly strives to increase morale and enhance the personal and professional growth of its personnel through suitable levels of remuneration, benefits, and opportunities for training. As a result, the Company believes that it has minimised the risk of key personnel leaving the Company.

Financial Statements

Report of the Independent Auditor To the Shareholders of Raimon Land Public Company Limited I have audited the accompanying consolidated balance sheets of Raimon Land Public Company Limited, its subsidiaries and its jointly controlled entities as at 31 December 2009 and 2008, the related consolidated statements of income, changes in shareholdersâ&#x20AC;&#x2122; equity and cash flows for the years then ended, and the separate financial statements of Raimon Land Public Company Limited for the same periods. These financial statements are the responsibility of the management of the Company, its subsidiaries and its jointly controlled entities as to their correctness and the completeness of the presentation. My responsibility is to express an opinion on these financial statements based on my audits. I conducted my audits in accordance with generally accepted auditing standards. Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. I believe that my audits provide a reasonable basis for my opinion. In my opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Raimon Land Public Company Limited, its subsidiaries and its jointly controlled entities and of Raimon Land Public Company Limited as at 31 December 2009 and 2008, the results of their operations, and cash flows for the years then ended, in accordance with generally accepted accounting principles.

Supachai Phanyawattano Certified Public Accountant (Thailand) No. 3930 Ernst & Young Office Limited Bangkok: 2 March 2010

Raimon Land Public Company Limited, its subsidiaries and its jointly controlled entities Balance sheets As at 31 December 2009 and 2008 (Unit: Baht) Consolidated financial statements Note

2009

2008

Separate financial statements 2009

2008

Assets Current assets Cash and cash equivalents

334,003,934

336,183,445

79,401,089

84,619,373

Restricted bank deposits

26,859,079

1,472,728

Unbilled completed work, net

1,343,079,590

1,364,836,084

1,343,079,590

1,275,049,598

Unbilled completed work - related parties

11,570,755

26,734,504

7,362,277

26,734,504

Amounts due from subsidiary and related company, net

110,424,835

5,397,823

and interest receivable, net

1,173,787,356

1,076,468,606

Project development cost, net

5,480,477,936

6,014,023,772

1,325,677,102

1,098,072,145

Land awaiting for sale, net

650,773,706

447,298,622

508,571,991

50,786,886

109,067,733

26,200,000

15,000,000

3,701,827

11,333,608

1,821,268

4,877,891

49,898,643

39,453,932

13,583,249

9,875,892

8,347,664,092

8,327,337,336

4,107,396,380

3,705,163,565

939,704,059

943,025,962

1,215,978,904

1,007,282,695

Short-term loans to subsidiaries and related company

Other current assets Advance payment to contractors Deposits for purchase of land Prepaid expenses Others Total current assets Non-current assets Long-term loans to jointly controlled entities and interest receivable

7, 11

Investments in subsidiaries, net

1,107,769,764

758,180,113

Investments in joint ventures

5,609,240

Property, plant and equipment, net

119,733,906

250,126,271

99,229,128

214,581,282

89,166,667

92,500,000

7,397,454

Leasehold right, net Land awaiting development, net Other non-current assets Deposits

8,889,636

11,384,285

2,381,636

4,248,729

34,464,565

48,154,705

13,784,636

11,359,074

Total non-current assets

1,199,356,287

1,352,588,677

2,452,150,762

2,008,658,587

Total assets

9,547,020,379

9,679,926,013

6,559,547,142

5,713,822,152

Others

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

Raimon Land Public Company Limited, its subsidiaries and its jointly controlled entities Balance sheets (continued) As at 31 December 2009 and 2008 (Unit: Baht) Consolidated financial statements Note

2009

2008

Separate financial statements 2009

2008

Liabilities and shareholders' equity Current liabilities Short-term loans from financial institutions

1,756,398,955

2,061,565,058

150,000,000

383,171,308

514,966,878

313,268,854

433,701,158

232,081,546

1,457,858,156

351,560,584

176,882,867

Amounts due to related company

442,354

388,735

250,825

Short-term loan from subsidiary and accrued interest

215,617,051

208,946,575

551,641,205

353,724,864

551,641,205

353,724,864

122,379,313

79,697,570

21,900,750

37,829,356

15,000,000

Trade accounts payable Current portion of long-term loans from financial institutions Current portion of long-term debentures Current portion of additional purchase of investment in subsidiary payable

Short-term loans from major shareholder and accrued interest Other current liabilities Accrued expenses Deposits received from sales of land Deposits received from customers

272,468,086

550,166,246

161,013,364

30,201,483

Deposits received from customers - related parties

2,112,800

43,727,351

100,000

Cash received in advance from customers

174,350,487

370,778,925

Cash received in advance from customers - related parties

4,680,049

Retention payable

67,700,029

81,234,459

56,605,117

52,781,462

Others

35,541,969

17,047,416

25,969,539

12,138,057

5,147,743,099

4,227,840,111

3,251,440,032

1,310,974,651

1,803,500,000

2,333,421,883

1,077,421,883

153,069,382

3,871,984

10,169,632

3,871,984

10,169,633

Total non-current liabilities

1,960,441,366

2,343,591,515

156,941,366

1,087,591,516

Total liabilities

7,108,184,465

6,571,431,626

3,408,381,398

2,398,566,167

Total current liabilities Non-current liabilities Long-term loans from financial institutions, net of current portion Additional purchase of investment in subsidiary payable, net of current portion Other non-current liabilities

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

Raimon Land Public Company Limited, its subsidiaries and its jointly controlled entities Balance sheets (continued) As at 31 December 2009 and 2008 (Unit: Baht) Consolidated financial statements Note

2009

2008

Separate financial statements 2009

2008

Shareholders' equity Share capital

Registered 3,312,173,403 ordinary shares of Baht 1 each (2008: 4,172,060,340 ordinary shares of Baht 1 each)

3,312,173,403

4,172,060,340

3,312,173,403

4,172,060,340

3,250,385,569

2,999,798,651

3,250,385,569

2,999,798,651

Issued and paid up 3,250,385,569 ordinary shares of Baht 1 each (2008: 2,999,798,651 ordinary shares of Baht 1 each) Share discount

(208,584,691)

Excess of investment in subsidiary arising as a result of additional purchase of investment in the subsidiary at a price higher than the net book value of the subsidiary at the acquisition date

(242,939,538)

36,131,233

(697,518,151)

66,606,109

(135,351,058)

487,910,792

Retained earnings (deficits) Appropriated - statutory reserve Unappropriated Equity attributable to Company's shareholders

2,346,059,113

2,893,951,302

3,151,165,744

3,315,255,985

92,776,801

214,543,085

Total shareholders' equity

2,438,835,914

3,108,494,387

3,151,165,744

3,315,255,985

Total liabilities and shareholders' equity

9,547,020,379

9,679,926,013

6,559,547,142

5,713,822,152

Minority interests - equity attributable to minority shareholders of subsidiaries

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

Raimon Land Public Company Limited, its subsidiaries and its jointly controlled entities Income statements For the years ended 31 December 2009 and 2008 (Unit: Baht) Consolidated financial statements Note

2009

2008

Separate financial statements 2009

2008

Revenues Sales of residential condominium units

3,098,905,951

2,706,885,258

1,142,194,930

1,830,115,155

6,576,150

4,837,658

3,554,504

3,066,632

55,409,770

30,728,182

Rental and service income Other income Project management fee income

Marketing commission income

8,012,836

4,380,868

151,206,268

76,092,007

Interest income

93,906,633

35,389,690

251,424,972

155,467,868

Gain on debt settlement

96,496,461

15,683,119

27,822,331

245,000

Gain on exchange rate Gain on sales of investment in subsidiary Reversal of accrued specific business tax and accrued transfer fees

62,516,290

39,663,379

67,514,011

14,341,247

23,952,024

9,793,012

3,387,095,161

2,856,173,342

1,643,425,587

2,145,171,235

2,296,856,786

1,773,922,739

951,691,272

1,243,374,501

162,457,855

373,849,128

46,520,372

123,047,154

Others Total revenues Expenses Cost of residential condominium units sold Selling expenses Administrative expenses

643,358,896

397,480,965

345,002,331

298,917,580

Management benefit expenses

44,443,780

49,451,133

44,443,780

49,451,133

Loss on diminution in value of land awaiting for sale

188,904,160

Doubtful account in short-term loan to subsidiary

273,776,001

Loss on diminution of investment in subsidiary

9,999,930

3,336,021,477

2,594,703,965

1,671,433,686

1,714,790,368

51,073,684

261,469,377

(163,821,893)

(24,266,201)

(112,748,209)

237,203,176

(28,008,099)

Finance cost

(164,064,939)

(119,770,389)

(108,239,081)

(49,269,336)

Income (loss) before corporate income tax

(276,813,148)

117,432,787

(136,247,180)

381,111,531

Others

Total expenses Income (loss) before share of loss from investments in joint ventures and finance cost and corporate income tax Share of loss from investments in joint ventures

(28,008,099) -

430,380,867 -

Income (loss) before finance cost and corporate income tax

Corporate income tax

Net income (loss) for the year

430,380,867

(3,820,147)

(280,633,295)

117,432,787

(136,247,180)

381,111,531

(277,109,590)

145,785,190

(136,247,180)

381,111,531

(0.04)

0.12

Net income (loss) attributable to: Equity holders of the parent Minority interests of the subsidiaries

Earnings per share

(3,523,705)

(28,352,403)

(280,633,295)

117,432,787

(0.09)

0.05

Basic earnings per share Net income (loss) attributable to equity holders of the parent Weighted average number of ordinary shares (shares)

3,250,385,569

3,134,071,021

3,250,385,569

3,134,071,021

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

72 Raimon Land Public Company Limited, its subsidiaries and its jointly controlled entities Statements of changes in shareholders' equity For the years ended 31 December 2009 and 2008 (Unit: Baht) Consolidated financial statements Equity attributable to the parent's shareholders Excess of investment in subsidiary arising as a result of additional purchase of investment

Issued

Note

Minority interest -

in the subsidiary at a price higher

Total

equity attributable

than the net book value

equity attributable

to minority

and paid-up

of the subsidiary

share capital

discount

at the acquisition date

2,740,181,671

(208,584,691)

2,740,181,671 259,616,980

Retained earnings (deficits) Appropriated

Unappropriated

17,075,656

(71,814,471)

(208,584,691)

17,075,656

19 19,055,577 055 577

Balance as at 31 December 2008

2,999,798,651

(208,584,691)

Balance as at 1 January 2009

2,999,798,651

(208,584,691)

Balance as at 1 January 2008 - previously reported

Balance as at 1 January 2008 - as restated

shareholders

of subsidiaries

Total

2,476,858,165

242,895,488

2,719,753,653

11,690,967

(60,123,504)

2,488,549,132

242,895,488

2,731,444,620

259,616,980

(19,055,577) (19 055 577)

145,785,190

(28,352,403)

117,432,787

36,131,233

66,606,109

2,893,951,302

214,543,085

3,108,494,387

36,131,233

66,606,109

2,893,951,302

214,543,085

3,108,494,387

208,584,691

(208,584,691)

250,586,918

(250,586,918)

(27,843,061)

(242,939,538)

(117,744,708)

(360,684,246)

Eliminate negative goodwill on investment in subsidiary

Share capital issued

to the parent's

11,690,967

Unappropriated retained earnings transferred to statutory reserve

Net income (loss) for the year

Offset share discount

Dividend paid

Stock dividend Cash dividend Additional purchase of investment in subsidiary

Decrease in minority interest from liquidation in subsidiary

(497,871)

Net loss for the period

(277,109,590)

(3,523,705)

(280,633,295)

3,250,385,569

(242,939,538)

36,131,233

(697,518,151)

Balance as at 31 December 2009

2,346,059,113

92,776,801

2,438,835,914 -

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

Raimon Land Public Company Limited, its subsidiaries and its jointly controlled entities Statements of changes in shareholders' equity (continued) For the years ended 31 December 2009 and 2008 (Unit: Baht) Separate financial statements Issued

Note Balance as at 1 January 2008

Net income for the year Balance as at 31 December 2008

Balance as at of 1 January 2009 Offset share discount

Dividend paid

Stock dividend Cash dividend Net loss for the period Balance as at 31 December 2009

share capital

discount

2,740,181,671

Share capital issued Unappropriated retained earnings transferred to statutory reserve

and paid-up

Retained earnings Appropriated

(208,584,691)

17,075,656

Unappropriated

Total

125,854,838

2,674,527,474

259,616,980

19,055,577

(19,055,577)

381,111,531

2,999,798,651

(208,584,691)

36,131,233

487,910,792

3,315,255,985

2,999,798,651

(208,584,691)

36,131,233

487,910,792

3,315,255,985

208,584,691

(208,584,691)

250 586 918 250,586,

(250 586,918) (250,586

(27,843,061)

(136,247,180)

3,250,385,569

36,131,233

(135,351,058)

3,151,165,744 -

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

Raimon Land Public Company Limited, its subsidiaries and its jointly controlled entities Cash flow statements For the years ended 31 December 2009 and 2008 (Unit: Baht) Consolidated financial statements 2009

2008

Separate financial statements 2009

2008

Cash flows from operating activities Net income (loss) before tax

(276,813,148)

117,432,787

(136,247,180)

381,111,531

Depreciation and amortisation

34,356,528

36,606,408

22,375,315

25,586,588

Loss (gain) on disposal / written-off of plant and equipment

82,157,339

Adjustments to reconcile net income (loss) before tax to net cash provided by (paid from) operating activities:

(828,771)

Gain on debt settlement

(96,496,461)

Unrealised gain from exchange

(15,683,119)

Gain on sales of investment in subsidiary

73,730,014 (15,683,119)

(451,627) -

(27,822,331)

(245,000)

(62,516,290)

(39,663,379)

Reversal of accrued specific business tax and accrued transfer fees Reversal of allowance for loss on diminution of unbilled completed wo

(3,561,249)

Loss on diminution in value of land awaiting for sale

188,904,160

Loss on steel contract cancellation

228,189,991

Loss on diminution of investment in subsidiary

9,999,930

Loss on liquidation of investment in subsidiary

482,447

273,776,001

163,821,893

24,266,201

Doubtful account in short-term loan to subsidiary Share of loss from investments in joint ventures Decrease in minority interest from liquidation of subsidiary Interest income

(497,871) (93,906,633)

(35,389,690)

(251,424,972)

(155,467,868)

384,538,067

356,082,198

168,996,822

114,105,128

595,009,497

407,830,512

142,444,009

324,975,373

Unbilled completed work

25,317,743

(392,371,445)

(64,468,743)

(883,814,817)

Unbilled completed work - related parties

15,163,749

(11,260,666)

Interest expenses (consist of interest expenses for operating and interest capitalised as part of project development cost) Income from operating activities before changes in operating assets and liabilities Operating assets decrease (increase)

Amounts due from subsidiary and related company

19,372,227

(26,734,504)

(105,027,012)

85,432,462

Project development cost

(306,132,030)

(757,685,280)

(227,604,957)

(31,872,368)

Advance payment to contractors

(166,916,622)

(379,930,078)

58,280,847

2,508,257

26,200,000

(21,200,000)

15,000,000

(10,000,000)

5,529,859

(19,999,037)

3,914,724

3,915,828

17,803,243

(41,357,374)

1,452,474

(7,627,186)

Deposits for purchase of land Other current assets Other non-current assets

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

Raimon Land Public Company Limited, its subsidiaries and its jointly controlled entities Cash flow statements (continued) For the years ended 31 December 2009 and 2008 (Unit: Baht) Consolidated financial statements 2009

2008

Separate financial statements 2009

2008

Operating liabilities increase (decrease) Trade accounts payable Amounts due to related company

201,698,024 53,619

57,174,384 (1,385,708)

Accrued expenses

41,530,271

33,001,722

Deposits received from sales of land

15,000,000

Deposits received from customers

(319,312,711)

(212,472,481)

Cash received in advance from customers

(201,108,487)

227,728,261

Other current liabilities Other non-current liabilities Cash flows from (used in) operating activities Cash received from interest income Cash paid for interest expenses Cash refund from corporate income tax Cash paid for corporate income tax Net cash flows used in operating activities

201,619,612 250,825 (15,928,606) -

96,196,050 (210,737) 7,450,173 -

130,711,881

(105,278,838)

(147,730,713)

4,960,123

(11,558,263)

17,655,137

11,588,686

(6,297,648)

5,074,293

(6,297,649)

4,584,234

(51,501,370) 891,577 (405,721,219) 4,517,448

(1,118,411,160) 3,900,449 (341,104,129) -

171,374,769 2,333,946 (170,863,259) 3,786,618

(676,618,100) 16,237,274 (72,045,986) -

(16,869,547)

(15,563,121)

(11,325,493)

(6,760,035)

(468,683,111)

(1,471,177,961)

(4,693,419)

(739,186,847)

Cash flows from investing activities Increase in restricted bank deposits

(26,859,079)

(1,472,728) (263,215,000)

Increase in short-term loans to subsidiaries

Decrease in long-term loan to subsidiary

Increase in long-term loan to jointly controlled entities

(67,484,934)

(583,841,500)

(67,484,934)

(448,652,030) 109,886,400 (583,841,500)

Cash received from sales of investment in subsidiary

Cash paid for purchase of investments in subsidiary

(11,499,925)

Cash paid for investments in joint ventures

(5,099,300)

Cash received from liquidation of subsidiary

Acquisition of equipment Proceeds from sales of equipment Net cash flows used in investing activities

(8,816,338) 26,990,643 (76,169,708)

(5,099,300) (45,605,636) 1,470,441 (633,075,995)

612,218 (6,781,344) 26,990,643 (311,351,145)

735,000

(30,303,452) 684,373 (968,090,434)

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

2008

Separate financial statements 2009

2008

Cash flows from financing activities Increase (decrease) in short-term loans from financial institutions Increase (decrease) in short-term loan from subsidiary Increase in short-term loans from major shareholder Cash receipt from long-term loans from financial institutions

(305,166,103)

2,031,565,058

(233,171,308)

353,171,308

(11,405,946)

190,000,000

224,860,000

150,499,195

224,860,000

150,499,195

1,138,815,813

1,272,297,718

391,315,813

519,461,878

Repayment of long-term loans from financial institutions

(210,879,540)

Repayment of long-term debentures

(255,064,123)

Cash paid for purchase of investment in subsidiary payable Proceeds from increase in share capital

(22,049,678) -

Dividend paid

(27,843,061)

Net cash from financing activities

542,673,308

Net decrease in cash and cash equivalents Cash and cash equivalents at beginning of the year

(2,179,511) 336,183,445

(1,774,000,000) 259,616,980 1,939,978,951

(10,879,540) (22,049,678) (27,843,061) 310,826,280

259,616,980 1,472,749,361

(164,275,005)

(5,218,284)

(234,527,920)

503,203,066

84,619,373

319,147,293

Less: Cash and cash equivalents at beginning of the year of subsidiary company excluded in the consolidated financial statements

334,003,934

336,183,445

79,401,089

84,619,373

Purchase of investment in subsidiary by installments

360,684,246

Stock dividend paid

250,586,918

Cash and cash equivalents at end of the year

(2,744,616)

S Supplementa l t l disc di losure of cash flow fl informattiion Non-cash transactions:

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

Raimon Land Public Company Limited, its subsidiaries and its jointly controlled entities Notes to consolidated financial statements For the years ended 31 December 2009 and 2008 1.

General information

1.1

Corporate information Raimon Land Public Company Limited (“the Company”) is a public company incorporated and domiciled in Thailand. Its major shareholder is IFA Hotels & Resorts 3 Ltd., a company existing under Kuwait laws. The Company is principally engaged in the property development and its registered address is 62 The Millennia Tower, 22nd Floor, Unit 2201-3, Langsuan Road, Lumpini, Pathumwan, Bangkok.

1.2

Economic crisis Although the economic crisis has now eased, there remains uncertainty concerning to the economic circumstances. These financial statements have been prepared on the basis of facts currently known to the Company, and on estimates and assumptions currently considered appropriate. However, they could be adversely affected by an array of future events.

Basis of preparation

2.1

The financial statements have been prepared in accordance with accounting standards enunciated under the Accounting Profession Act B.E. 2547 and their presentation has been made in compliance with the stipulations of the Notification of the Department of Business Development dated 30 January 2009, issued under the Accounting Act B.E. 2543. The financial statements in Thai language are the official statutory financial statements of the Company. The financial statements in English language have been translated from the Thai language financial statements. The financial statements have been prepared on a historical cost basis except where otherwise disclosed in the accounting policies.

2.2 Basis of consolidation a)

The consolidated financial statements include the financial statements of the Company (“the Company”) and the following subsidiary companies (“the subsidiaries”):

Revenues as

Companyâ&#x20AC;&#x2122;s name

Contemporary Property

Assets as

a percentage of the

a percentage

consolidated total

of the consolidated

revenues for the

Nature of

Country of

Percentage of

total assets

year ended 31

business

incorporation

shareholding

as at 31 December

December

Property

2009

2008

2009

2008

2009

2008

Percent

Thailand

98.59

1.21

6.76

10.68

6.54

Thailand

95.00

0.01

0.08

Liquidation

Thailand

55.00

0.01

Property

Thailand

84.84

59.84

23.36

20.53

49.88

25.73

Thailand

99.99

6.65

8.76

Thailand

99.99

20.96

19.60

0.02

Thailand

99.93

0.02

0.08

0.01

Thailand

99.99

0.01

0.02

0.01

development

Company Limited Raimon Land

Plan and

Planner

planner

Company

administrator

Limited Strategic Property Company Limited Taksin Hotel Holding

development

Company Limited and its subsidiary (Held by the Company 73.84% (2008: 48.84%) and indirectly held by Contemporary Property Company Limited 11% (2008: 11%)) Raimon Land Property

Property development

Company Limited Raimon Land Park View

Property development

Development Company Limited Raimon Land Resorts

Investment and service

Company Limited Wireless One Residences Company Limited

Property development

In May 2009, the Company acquired an additional 3,080,500 ordinary shares of Taksin Hotel Holding Company Limited (the subsidiary), or 25 percent of the subsidiary’s registered share capital, at a total of approximately Baht 360.7 million. As a result of this investment, the Company increased its shareholding to 73.84 percent of the subsidiary’s registered share capital. On 26 October 2009, the Extraordinary General Meeting of Strategic Property Company Limited’s shareholders passed a resolution for the Strategic Property Company Limited to register its dissolution and on 24 December 2009, the subsidiary’s liquidator completed the liquidation processes and notified the dissolution. Thus, the financial statement of Strategic Property Company Limited was not included in the consolidated financial statement for the current year. b)

Subsidiaries are fully consolidated as from the date of acquisition, being the date on which the Company obtains control, and continue to be consolidated until the date when such control ceases.

The financial statements of the subsidiaries are prepared for the same reporting period as the parent company, using consistent significant accounting policies.

Material balances and transactions between the Company and its subsidiaries have been eliminated from the consolidated financial statements.

Minority interests represent the portion of net income or loss and net assets of the subsidiaries that are not held by the Company and are presented separately in the consolidated income statement and within equity in the consolidated balance sheet.

2.3

The separate financial statements, which present investments in subsidiaries and joint ventures presented under the cost method, have been prepared solely for the benefit of the public.

Adoption of new accounting standards In June 2009, the Federation of Accounting Professions issued Notification No. 12/2552, assigning new numbers to Thai Accounting Standards that match the corresponding International Accounting Standards. The numbers of Thai Accounting Standards as referred to in these financial statements reflect such change. The Federation of Accounting Professions has issued Notification No. 86/2551 and 16/2552, mandating the use of new accounting standards, financial reporting standards and accounting treatment guidance as follows:

3.1

Accounting standards, financial reporting standards and accounting treatment guidance which are effective for the current year Framework for the Preparation and Presentation of Financial Statements (revised 2007) TAS 36 (revised 2007)

Impairment of Assets

TFRS 5 (revised 2007)

Non-current Assets Held for Sale and Discontinued Operations

Accounting Treatment Guidance for Leasehold Right Accounting Treatment Guidance for Business Combination under Common Control These accounting standards, financial reporting standards and accounting treatment guidance became effective for the financial statements for fiscal years beginning on or after 1 January 2009. The management has assessed the effect of these standards and believes that Framework for Preparation and Presentation of Financial Statements (revised 2007), TAS 36 (revised 2007), TFRS 5 (revised 2007), Accounting Treatment Guidance for Leasehold Right and Accounting Treatment Guidance for Business Combination under Common Control do not have any significant impact on the financial statements for the current year. 3.2 Accounting standards which are not effective for the current year Effective date TAS 20

Accounting for Government

1 January 2012

Grants and Disclosure of Government Assistance TAS 24 (revised 2007)

Related Party Disclosures

1 January 2011

TAS 40

Investment Property

1 January 2011

However, TAS 24 (revised 2007) and TAS 40 allow early adoption by the entity before the effective date. The management of the Company has assessed the effect of these standards and believes that TAS 20 and TAS 40 are not relevant to the business of the Company, while TAS 24 (revised 2007) will not have any significant impact on the financial statements for the year in which it is initially applied.

Significant accounting policies

4.1

Revenue recognition Sales of residential condominium units Sales of residential condominium units are recognised as revenue when contracts to purchase and sell of not less than 40 percent of the area opened for sales have been executed and initial payments have been received up to a certain level. The minimum initial payment to be received is set not less than 20 percent of their selling price. Revenue from sales of residential condominium units is recognised on a percentage of completion method, the percentage of completion measured by the proportion of actual development costs incurred up to the end of the period and the total anticipated development cost to be incurred to completion, excluding the cost of land. The excess revenue which is over collection is recorded as “Unbilled completed work” in the balance sheet and the excess collection which is over revenue is recorded as “Cash received in advance from customers” in the balance sheet. The Company and its subsidiaries will cease revenue recognition for residential condominium units with contracts to purchase and sell and receivables outstanding for more than three installments. Rental and service income Rental and related services income of units in office buildings and residential buildings are recognised on an accrual basis. Interest income Interest income is recognised on an accrual basis based on the effective interest rate.

4.2

Cost of residential condominium units sold In determining the cost of residential condominium units sold, the anticipated total development costs (after recognizing the cost incurred to date) are attributed to units already sold on the basis of the sale value and then recognised as cost in the income statement according to the percentage of completion basis.

4.3

Cash and cash equivalents Cash and cash equivalents consist of cash in hand and cash at banks and all highly liquid investments with an original maturity of three months or less and not subject to withdrawal restrictions.

4.4

Trade accounts receivable and allowance for doubtful debts Trade accounts receivable are stated at the net realisable value. Allowance for doubtful accounts is provided for receivables outstanding for more than three installments or for the estimated losses that may be incurred in collection of receivables. The allowance is generally based on collection experiences and analysis of debt aging.

4.5

Project development cost Project development cost is stated at cost less allowance for loss on diminution in value of projects. The details of cost calculation are as follows: Land

The Company and its subsidiaries record cost of land separately for each project.

Construction in progress

Construction in progress consists of the cost of design, cost of construction, public utility costs and interest capitalised to cost of projects. The Company and

its

subsidiaries

record

cost

design,

construction and public utilities based on the actual cost incurred. 4.6

Borrowing costs Borrowing costs directly attributable to the acquisition construction of the projects that necessarily take a substantial period of time to get ready for their intended sale are capitalised as part of the cost of the respective projects and will be ceased when the projects are completed or when the construction is suspended until active development resumes. All other borrowing costs are expensed in the period they are incurred. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds.

4.7

Investments a)

Investments in joint ventures are accounted for in the consolidated financial statements using the equity method.

Investments in subsidiaries and joint ventures are accounted for in the separate financial statements using the cost method.

4.8

Property, plant and equipment depreciation Land is stated at cost. Buildings and equipment are stated at cost less accumulated depreciation and allowance for loss on impairment of assets. Depreciation of buildings and equipment is calculated by reference to their costs on a straight-line basis over the following estimated useful lives: Buildings and building improvement Furniture, fixtures and office equipment

20 years 3, 5 years

Motor vehicles

5 years

Depreciation is included in determining income. No depreciation is provided on land and land improvement. 4.9

Leasehold right and amortisation Leasehold right is stated at cost less accumulated amortisation. Amortisation of leasehold right is calculated by reference to its cost on a straight-line basis over the leasehold period.

4.10 Related party transactions Related parties comprise enterprises and individuals that control, or are controlled by, the Company, whether directly or indirectly, or which are under common control with the Company. They also include associated companies and individuals which directly or indirectly own a voting interest in the Company that gives them significant influence over the Company, key management personnel, directors and officers with authority in the planning and direction of the Companyâ&#x20AC;&#x2122;s operations. 4.11 Foreign currencies Transactions in foreign currencies are translated into Baht at the exchange rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated into Baht at the exchange rate ruling at the balance sheet date. Gains and losses on exchange are included in determining income.

4.12 Impairment of assets At each reporting date, the Company performs impairment reviews in respect of the property, plant and equipment and other assets whenever events or changes in circumstances indicate that an asset may be impaired. An impairment loss is recognised when the recoverable amount of an asset, which is the higher of the assetâ&#x20AC;&#x2122;s fair value less costs to sell and its value in use, is less than the carrying amount. In determining value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs to sell, an appropriate valuation model is used. These calculations are corroborated by a valuation model that, based on information available, reflects the amount that the Company could obtain from the disposal of the asset in an armâ&#x20AC;&#x2122;s length transaction between knowledgeable, willing parties, after deducting the costs of disposal. An impairment loss is recognised in the income statement. 4.13 Employee benefits Salaries, wages, bonuses and contributions to the social security fund and provident fund are recognised as expenses when incurred. 4.14 Income tax Income tax is provided in the accounts based on the taxable profits determined in accordance with tax legislation. 5.

Significant accounting judgments and estimates The preparation of financial statements in conformity with generally accepted accounting principles at times requires management to make subjective judgments and estimates regarding matters that are inherently uncertain. These judgments and estimates affect reported amounts and disclosures and actual results could differ. Significant judgments and estimates are as follow: Project development costs estimation In recognising revenue from real estate sales, the Company and its subsidiaries need to estimate all project development costs, including land costs, land improvement costs, design costs, construction costs, and borrowing costs for construction. The management estimates these costs based on their business experience and revisit the estimation on a periodic basis or when the actual costs incurred significantly vary from the estimation.

Unbilled completed work (Unit: Baht) Consolidated financial statements 2008

2009

Separate financial statements 2009

2008

Value of contracts under which recognition of sales has commenced

12,427,463,137

9,275,194,988

4,274,858,635

4,184,988,821

2,191,159,830

3,954,877,621

812,772,400

200,926,461

6,819,150,307

9,391,857,197

1,127,368,965

1,966,014,524

21,437,773,274

22,621,929,806

6,215,000,000

6,351,929,806

4,196,359,452

3,794,297,454

3,923,586,178

2,827,413,803

(2,853,279,862)

(2,425,900,121)

(2,580,506,588)

(1,548,802,956)

1,343,079,590

1,368,397,333

1,343,079,590

1,278,610,847

Value of sales not meeting criteria for revenue recognition Estimated future sale value of projects already open for sale Estimated total selling price of projects already open for sale â&#x20AC;&#x201C; total contract price

Unbilled completed work Revenue recognised Less: Collection

Less: Allowance for loss on diminution of unbilled completed work

(3,561,249)

1,343,079,590

1,364,836,084

1,343,079,590

1,275,049,598

52,635,893

65,845,387

13,499,477

54,406,729

(41,065,138)

(39,110,883)

(6,137,200)

(27,672,225)

11,570,755

26,734,504

7,362,277

26,734,504

2,553,534,276

1,091,882,801

(721,103,876)

174,350,487

370,778,925

Collection

17,958,630

Less: Revenue recognised

(13,278,581)

4,680,049

Net

Unbilled completed work â&#x20AC;&#x201C; related parties Revenue recognised Less: Collection

Cash received in advance from customers Collection Less: Revenue recognised

(2,379,183,789)

Cash received in advance from customers â&#x20AC;&#x201C; related parties

(Unit: Baht) Consolidated financial statements 2009

2008

Separate financial statements 2009

2008

Sales value of projects for which contracts have been prepared in proportion to total sales value of project Estimated future sales value of projects already open for sale Add: Value of project which have already

6,819,150,307

9,391,857,197

14,618,622,967

13,230,072,609

been sold

1,127,368,965

1,966,014,524

5,087,631,035

4,385,915,282

6,215,000,000

6,351,929,806

Estimated total selling price of projects already open for sale - total contract price Proportion of sales value/project value

21,437,773,274

22,621,929,806

68.19%

58.48%

81.86%

69.05%

As at 31 December 2009, the Company ceased revenue recognition for a residential condominium unit with contract values of Baht 8.3 million (31 December 2008: 1 residential condominium unit, Baht 18.7 million). During the current year, the Company and a subsidiary entered into residential condominium unit sales agreements with two major buyers (1 local buyer and 1 foreign buyer), amounting to Baht 1,682 million (separate financial statements: Baht 797 million) and received deposits of Baht 249 million (separate financial statements: Baht 160 million), which are recorded as “Deposits received from customers” in the balance sheets. These agreements appoint the Company to help the buyers sell their units at an agreed price and grant the buyers an option to sell some units to the Company’s major shareholder. The sales value of these agreements was included in this note under the caption of “Value of sales not meeting criteria for revenue recognition” because these sales agreements do not yet meet the criteria for revenue recognition. This account also includes Baht 797 million from sales of residential condominium units that the Company did not recognise as sales because foreign holdings in the residential units in the project sold under those agreements is fully taken.

Related party transactions Over the years, the Company and its subsidiaries had significant business transactions with related parties. Such transactions, which are summarised below, arose in the ordinary course of business and were concluded on commercial terms and bases agreed upon between the Company and those related parties. (Unit: Million Baht) Consolidated

Separate

financial statements

2009

2008

2009

Transfer Pricing Policy

2008

Transactions with subsidiaries (Eliminated from the consolidated financial statements) Project management fee income

55.4

30.7

As stipulated in agreements

Marketing commission income

143.3

75.2

At prices charged to the third parties

Interest income

109.9

106.3

Interest rate of 8% and 10% per annum (2008: Interest rate of 10% per annum)

Interest expense

18.1

18.9

Interest rate of 10% per annum

93.0

31.6

141.2

47.2

Interest rate of 15% per annum

21.0

4.1

0.4

Transactions with jointly controlled entities Interest income Transactions with related companies (Related by the way of common directors) Sales of residential condominium units Marketing commission income

Similar to market price At prices charged to the third parties

Service fee expenses Marketing commission expense

4.1

5.0

1.8

2.2

1.9

Similar to market price At prices charged to the third parties

Transactions with major shareholder Interest expenses

64.8

23.6

64.8

23.6

Interest rate of 15% and 10% per annum

Transactions with directors and employees Sales of residential condominium units Transfer fee of the agreement to sale and to purchase residential

18.8

57.5

4.7

48.1

0.2

0.6

0.2

Similar to market price At prices charged to the third parties

condominium units

As at 31 December 2009 and 2008, the balances of the accounts between the Company and those related parties are as follows: (Unit: Baht) Consolidated financial statements 2008

2009

Separate financial statements 2009

2008

Amounts due from subsidiary and related company Subsidiary - Taksin Properties Company Limited

110,424,835

5,397,823

Related company - Cha-am Campus City Company Limited Less: Allowance for doubtful debts Net

19,200,000

(19,200,000)

110,424,835

5,397,823

Short-term loans to subsidiaries and related company and interest receivable Subsidiaries - Raimon Land Property Company Limited Loans

529,500,000

467,745,000

Interest receivable

128,177,253

76,299,417

- Raimon Land Park View Development Company Limited Loans

687,187,375

474,447,375

Interest receivable

100,505,754

44,077,476

Loans

2,180,000

7,760,000

Interest receivable

12,975

221,957

- Raimon Land Resorts Company Limited

- Raimon Land Planner Company Limited Loans

5,700,000

Interest receivable

217,381

Related company - Cha-am Campus City Company Limited Loans

427,318,741

Interest receivable

401,996,061

401,996,061 1,905,783,408

Less: Allowance for doubtful debts Net

829,314,802

2,276,878,159

(829,314,802)

(1,103,090,803)

1,173,787,356

(829,314,802) 1,076,468,606

(Unit: Baht) Consolidated financial statements 2009

Separate financial statements

2008

2009

2008

Long-term loans to jointly controlled entities and interest receivable - Raimon Land Development Company Limited Loans

334,560,000

290,700,000

334,560,000

290,700,000

Interest receivable

101,856,696

55,931,545

101,856,696

55,931,545

Loans

651,766,434

628,141,500

651,766,434

628,141,500

Interest receivable

127,795,774

32,509,650

127,795,774

32,509,650

1,215,978,904

1,007,282,695

1,215,978,904

1,007,282,695

- Raimon Land Residences Company Limited

Less: Provision for loss on investment in joint ventures (Note 11) Net

(276,274,845)

(64,256,733)

939,704,059

943,025,962

1,215,978,904

1,007,282,695

442,354

388,735

250,825

442,354

388,735

250,825

178,594,054

190,000,000

Amounts due to related company - The Siam Administrative Management Company Limited

Short-term loan from subsidiary and accrued interest - Contemporary Property Company Limited Loans Accrued interest

37,022,997

18,946,575

215,617,051

208,946,575

540,695,216

322,836,016

540,695,216

322,836,016

10,945,989

30,888,848

10,945,989

30,888,848

551,641,205

353,724,864

551,641,205

353,724,864

2,112,800

34,554,189

100,000

9,173,162

2,112,800

43,727,351

100,000

Short-term loans from major shareholder and accrued interest - IFA Hotels & Resorts 3 Ltd. Loans Accrued interest

Deposits received from customers â&#x20AC;&#x201C; related parties - Directors and employees - Emasia Properties Limited

During 2009, the movement of loans to subsidiaries, jointly controlled entities and related companies and related interest receivable, and loans from subsidiaries and major shareholder and related accrued interest are as follows: (Unit: Baht) Consolidated financial statements Increase

2008

Decrease

2009

Short-term loans to subsidiaries and related company and interest receivable Related company - Cha-am Campus City Company Limited Loans

427,318,741

Interest receivable

401,996,061

829,314,802

(829,314,802)

290,700,000

43,860,000

334,560,000

55,931,545

45,925,151

101,856,696

628,141,500

23,624,934

651,766,434

32,509,650

95,286,124

127,795,774

1,007,282,695

208,696,209

1,215,978,904

(212,018,112)

(276,274,845)

(3,321,903)

939,704,059

540,695,216

Less: Allowance for doubtful debts Net

Long-term loans to jointly controlled entities and interest receivable

- Raimon Land Development Company Limited Loans Interest receivable - Raimon Land Residences Company Limited Loans Interest receivable

Less: Provision for loss on investment in joint ventures (Note 11)

(64,256,733) 943,025,962

Net Short-term loans from major shareholder and accrued interest

- IFA Hotels & Resorts 3 Ltd. Loans Accrued interest

322,836,016

217,859,200

30,888,848

64,775,441

(84,718,300)

10,945,989

353,724,864

282,634,641

(84,718,300)

551,641,205

(Unit: Baht) Separate financial statements Increase

Decrease

467,745,000

97,500,000

(35,745,000)

529,500,000

76,299,417

52,608,985

(731,149)

128,177,253

474,447,375

212,740,000

687,187,375

44,077,476

56,428,278

100,505,754

2008

2009

Short-term loans to subsidiaries and related company and interest receivable

Subsidiaries - Raimon Land Property Company Limited Loans Interest receivable - Raimon Land Park View Development Company Limited Loans Interest receivable - Raimon Land Resorts Company Limited Loans

7,760,000

(5,580,000)

2,180,000

221,957

564,065

(773,047)

12,975

5,700,000

(5,700,000)

217,381

363,551

(580,932)

Loans

427,318,741

Interest receivable

401,996,061

Interest receivable - Raimon Land Planner Company Limited Loans Interest receivable Related company - Cha-am Campus City Company Limited

1,905,783,408 Less: Allowance for doubtful debts Net

(829,314,802)

420,204,879 (273,776,001)

(49,110,128) -

2,276,878,159 (1,103,090,803)

1,076,468,606

146,428,878

290,700,000

43,860,000

334,560,000

55,931,545

45,925,151

101,856,696

628,141,500

23,624,934

651,766,434

32,509,650

95,286,124

127,795,774

1,007,282,695

208,696,209

1,215,978,904

190,000,000

75,000,000

18,946,575

18,076,422

208,946,575

93,076,422

(49,110,128)

1,173,787,356

Long-term loans to jointly controlled entities and interest receivable

- Raimon Land Development Company Limited Loans Interest receivable - Raimon Land Residences Company Limited Loans Interest receivable

Short-term loan from subsidiary and accrued interest

- Contemporary Property Company Limited Loan Accrued interest

(86,405,946) (86,405,946)

178,594,054 37,022,997 215,617,051

(Unit: Baht) Separate financial statements 2008

Increase

Decrease

2009

Short-term loans from major shareholder and accrued interest

- IFA Hotels & Resorts 3 Ltd. Loans Accrued interest

322,836,016

217,859,200

540,695,216

30,888,848

64,775,441

(84,718,300)

10,945,989

353,724,864

282,634,641

(84,718,300)

551,641,205

Directorsâ&#x20AC;&#x2122; and managementâ&#x20AC;&#x2122;s remuneration In 2009 the Company paid salaries, meeting allowances and gratuities to their directors and management totaling Baht 44.4 million (2008: Baht 49.5 million). Guarantee obligations with related parties The Company and a subsidiary have outstanding guarantee obligations with their related parties, as described in Notes 13, 14 and 23.3 to the financial statements. Short-term loans to subsidiaries and interest receivable The Company entered into loan agreements with Raimon Land Property Company Limited, Raimon Land Park View Development Company Limited and Raimon Land Resorts Company Limited. These are unsecured loans carrying interest at a rate of 10 percent per annum and loan repayment is due at call. Long-term loans to jointly controlled entities and interest receivable The Company entered into loan agreements with Raimon Land Development Company Limited and Raimon Land Residences Company Limited. These are unsecured loans carrying interest at a rate of 15 percent per annum and loan repayment is due by 10 August 2012. Short-term loan from subsidiary and accrued interest The Company entered into a loan agreement with Contemporary Property Company Limited. This is an unsecured loan carrying interest at a rate of 10 percent per annum and loan repayment is due at call.

Short-term loans from major shareholder and accrued interest The Company entered into loan agreements with IFA Hotels & Resorts 3 Ltd. which is for shareholder of the Company. The loan is to be used to develop a project for working capital of the Company. These are unsecured loans carrying interest at a rate of 10 percent per annum and loan repayment is due within 6 months after 31 July 2008. On 4 February 2009, a meeting of the Companyâ&#x20AC;&#x2122;s Board of Directors passed resolutions granting approval to an extension of the maturity date for the outstanding loans and accrued interest to within one year after 31 December 2008 and changing the interest rate to be no more than 15 percent per annum. On 29 April 2009, the 2009 Annual General Meeting of Shareholders passed resolutions granting approval to obtain additional loans from IFA Hotels & Resorts 3 Ltd. (the shareholder) of up to USD 10 million, or approximately Baht 359 million, carrying interest at maximum rate of 10 percent per annum. During the current year, the Company entered into loan agreements with its major shareholder and drew down loans amounting to USD 6.5 million, or approximately Baht 219 million. These are unsecured loans carrying interest at a rate of 10 percent per annum, on which withholding tax is payable by the Company. Repayment is due in January 2010. On 1 February 2010, the Company made a loan repayment of USD 3.5 million, or approximately Baht 116.4 million. Subsequently, on 11 February 2010, a meeting of the Companyâ&#x20AC;&#x2122;s Board of Directors passed resolutions granting approval to extend the due date of the balance of the loan, amounting to Baht 432.7 million and accrued interest, such that it is due within one year after 1 February 2010.

8. Project development cost (Unit: Baht) Separate financial statements

Consolidated financial statements 2009

2008

2009

2008

Land and construction under development

8,898,720,900

7,985,738,450

3,220,710,578

2,911,271,318

Developed land and construction

1,830,779,142

1,055,449,983

888,498,878

93,506,658

10,729,500,042

9,041,188,433

4,109,209,456

3,004,777,976

(5,237,652,924)

(3,015,795,479)

(2,772,163,172)

(1,895,336,649)

5,491,847,118

6,025,392,954

1,337,046,284

1,109,441,327

Total Less: Accumulated costs transferred to cost of sales

Less: Allowance for loss on diminution in value of project Project development cost, net

(11,369,182) 5,480,477,936

(11,369,182) 6,014,023,772

(11,369,182) 1,325,677,102

(11,369,182) 1,098,072,145

During 2009 and 2008, the Company and its subsidiaries capitalised interest of approximately Baht 268.3 million and Baht 264.2 million, respectively (separate financial statements: Baht 77.5 million and Baht 68.3 million, respectively) as part of project development cost. The Company and its subsidiaries have mortgaged most of their land and construction thereon with banks and financial institutions to secure the Companyâ&#x20AC;&#x2122;s and its subsidiariesâ&#x20AC;&#x2122; loans from these banks and financial institutions. 9.

Land awaiting sale (Unit: Baht) Consolidated financial statements 2009 Land awaiting sale

2008

839,677,866

of land awaiting sale

(188,904,160)

Land awaiting sale, net

650,773,706

Less: Allowance for loss on diminution in value

During the first quarter of the year 2009, a subsidiary transferred project development costs to land awaiting development because the project of the subsidiary had been delayed. Subsequently, in the fourth quarter of 2009, the subsidiary entered into a land sale agreement amounting to Baht 726.8 million and received a deposit for land sale amounting to Baht 15.0 million. The subsidiaryâ&#x20AC;&#x2122;s management considered that the recoverable amount was less than the carrying amount and therefore reserved allowance for loss on diminution in value of land awaiting sale totaling Baht 188.9 million and recorded loss in the income statement for the year ended 31 December 2009.

As at 31 December 2009, the land awaiting sale was mortgaged with a financial institution to secure a short-term loan for the subsidiary obtained from the financial institution. On 29 January 2010, the subsidiary received the remaining balance for land sale according to the land sale agreement and transferred the ownership of the land to the buyers. 10.

Investments in subsidiaries Details of investments in subsidiaries as presented in separate financial statements are as follows: (Unit: Baht) Shareholding Companyâ&#x20AC;&#x2122;s name

2009

Contemporary Property Company Limited Raimon Land Planner Company Limited Strategic Property Company Limited Raimon Land Property Company Limited Raimon Land Park View Development Company

percentage

Paid-up capital 2008

200,000,000

Cost

2009

2008

(%)

2009

2008

200,000,000

98.59

196,126,033

2,000,000

95.00

1,900,000

15,525,000

55.00

7,150,000

10,000,000

99.99

9,999,930

100,000,000

99.99

99,999,930

1,232,030,000

84.84

59.84

806,994,051

446,309,805

250,000

99.93

249,825

2,500,000

99.99

2,499,925

1,117,769,694

764,235,448

(9,999,930)

(6,055,335)

1,107,769,764

758,180,113

Limited Taksin Hotel Holding Company Limited and its subsidiary (Held by the Company 73.84% (2008: 48.84%) and indirectly held by Contemporary Property Company Limited 11% (2008: 11%)) Raimon Land Resorts Company Limited Wireless One Residences Company Limited Total Less: Allowance for loss on diminution of investments in subsidiaries Investments in subsidiaries, net

The Company pledged the ordinary shares of Raimon Land Property Company Limited and Taksin Hotel Holding Company Limited as collateral for each subsidiaryâ&#x20AC;&#x2122;s shortterm loans and long-term loans from banks. Raimon Land Park View Development Company Limited On 15 January 2007, the Company entered into an option agreement to a foreign company to purchase 25 percent of the total shares of Raimon Land Park View Development Company Limited (the subsidiary) at a price of Baht 25 million. The exercise period of the option runs until 30 days from the date on which the subsidiary

obtains licenses and approvals for the construction of a residential condominium project from the relevant government agencies. On 22 January 2010, the subsidiary received the licenses and approvals for constructing a

residential

condominium

project

from

the

relevant

government

agencies.

Subsequently, on 9 February 2010, the Company received a letter confirming that the foreign company would not exercise the option. Taksin Hotel Holding Company Limited On 14 September 2007, the Company entered into an option agreement to a foreign company to sell 25 percent of the total shares of Taksin Hotel Holding Company Limited (the subsidiary) to the Company at the price of USD 10 million, which is the same price that such foreign company purchased the share for from a former shareholder of the subsidiary, plus financial costs incurred during the shareholding period at the rate of 15 percent per annum. The exercise period of such option ran from 14 June 2008 to 13 September 2009. On 29 April 2009, the 2009 Annual General Meeting of the Company’s Shareholders passed resolutions granting approval for the Company and/or the Company’s subsidiary to purchase 25 percent of the total shares of Taksin Hotel Holding Company Limited. Subsequently, on 22 May 2009, the Company purchased an additional 3,080,050 ordinary shares of this subsidiary, for a price of USD 10.5 million, through payment by quarterly installment from May 2009 to May 2011. As a result of the additional purchase of shares, the Company increased its investment approximately Baht 360.7 million and its shareholding increased from 48.84 percent to 73.84 percent of the subsidiary’s registered share capital. The excess of the acquisition price over the attributable net book value of this subsidiary at the acquisition date, amounting to Baht 242.9 million, was therefore recorded in shareholders’ equity under the caption of “Excess of investment in subsidiary arising as a result of additional purchase of investment in the subsidiary at a price higher than the net book value of the subsidiary at the acquisition date”. Strategic Property Company Limited On 26 October 2009, the Extraordinary General Meeting of the shareholders of Strategic Property Company Limited passed a resolution to dissolve the company, and the subsidiary registered its dissolution with the Ministry of Commerce on 29 October 2009. Subsequently, on 24 December 2009, the subsidiary’s liquidator completed the liquidation process, repaid share capital to its shareholders and notified the Ministry of Commerce of the dissolution of such subsidiary.

11.

Investments in joint ventures/Provision for loss on investments in joint ventures

11.1 Details of investments in joint ventures: Investments in joint ventures represent investments in entities which are jointly controlled by the Company and IFA Hotels & Resort 3 Ltdâ&#x20AC;&#x2122;s affiliated companies according to the shareholder agreement. Details of these investments are as follows: (Unit: Baht) Consolidated financial statements Nature of

Country of

business

incorporation

Jointly controlled entities

Carrying amounts based on Shareholding percentage 2009

Raimon Land Residences Company Limited and its subsidiary

Property Property

2009

2008

2009

2008

Thailand

development

Raimon Land Development Company Limited

equity method

Cost

2008

51.0

5,099,300

(64,702,072)

(3,627,252)

51.0

509,940

(211,572,773)

(60,629,481)

5,609,240

(276,274,845)

(64,256,733)

(276,274,845)

(64,256,733)

Thailand

development Total Presented as: - Investments in joint ventures - Presented net in long-term loans to jointly control entities (Note 7)

(Unit: Baht) Separate financial statements Jointly controlled entities

Nature of

Country of

Shareholding

business

incorporation

percentage 2009

Raimon Land Residences Company Limited and its subsidiary Raimon Land Development Company Limited Total

Property

2009

2008

Provision for impairment

Carrying amounts based

of investments

on cost method â&#x20AC;&#x201C; net

2009

2008

2009

2008

Thailand

development Property

2008

Cost

51.0

5,099,300

Thailand

development 509,940

509,940

5,609,240

The Company pledged the ordinary shares of Raimon Land Development Company Limited as collateral for the jointly controlled entityâ&#x20AC;&#x2122;s loan. 11.2 Share of loss During the year, the Company recognised its share of net loss from investments in joint ventures in consolidated financial statements as follows: (Unit: Baht) Consolidated financial statements Share of loss from investments in Jointly controlled entities

joint ventures during the year 2008

2009 Raimon Land Residences Company Limited and its

(61,074,820)

(8,726,552)

Raimon Land Development Company Limited

(150,943,292)

(31,181,607)

Total

(212,018,112)

(39,908,159)

subsidiary

Less: Interest income of the Company received from longterm loans to jointly controlled entities (in proportion to the Company)

48,196,219

15,641,958

(163,821,893)

(24,266,201)

11.3 Summarised financial information of jointly controlled entities a)

Raimon Land Residences Company Limited and its subsidiary (Ploenchit Residences Company Limited) The Companyâ&#x20AC;&#x2122;s proportionate shares of the assets, liabilities, revenue and expenses of Raimon Land Residences Company Limited and its subsidiary, according to the proportion under the joint venture agreement, is as follows: (Unit: Baht) As at 31 December 2008

2009 Current assets Non-current assets

Current liabilities

1,315,800,800

1,215,362,198

1,332,825

529,785

1,317,133,625

1,215,891,983

(1,381,835,697)

Non-current liabilities Net assets

(64,702,072)

(1,757,073) (1,217,762,162) (3,627,252)

(Unit: Baht)

Other income

For the period ended

31 December

2009

2008 32,465

80,322

(683,555)

(266,527)

Finance cost

(60,423,730)

(8,540,347)

Net loss

(61,074,820)

(8,726,552)

Administrative expenses

For the year ended

Raimon Land Residences Company Limited and its subsidiary have mortgaged their land as collateral for loans granted by commercial banks. b)

Raimon Land Development Company Limited The Companyâ&#x20AC;&#x2122;s proportionate shares of the assets, liabilities, revenue and expenses of Raimon Land Development Company Limited, according to the proportion under the joint venture agreement, is as follows: (Unit: Baht) As at 31 December 2009

2008

391,889,232

501,332,395

3,775,647

10,321,639

395,664,879

511,654,034

Current liabilities

(462,329,830)

(571,256,922)

Non-current liabilities

(144,907,822)

(1,026,593)

Net assets

(211,572,773)

(60,629,481)

For the year ended 31 December 2009

(Unit: Baht) For the period ended 31 December 2008

Current assets Non-current assets

Other income

37,275,613

61,442

Selling expenses

(12,005,228)

(28,186,316)

Administrative expenses

(14,849,707)

(2,577,063)

Loss on diminution in value of project cost development Finance cost Net loss

(160,342,798)

(1,021,172)

(479,670)

(150,943,292)

(31,181,607)

Raimon Land Development Company Limited has mortgaged its project land and construction thereon as collateral for its loans obtained from a bank.

12.

Property, plant and equipment (Unit: Baht) Consolidated financial statements Land and

Building and

land

building

Furniture

Office

Motor

improvement

and fixtures

equipment

vehicles

Total

33,959,764

178,266,515

65,960,403

22,824,722

51,720,657

352,732,061

Additions

3,688,562

1,979,956

3,147,820

8,816,338

Disposals

(26,408,089)

(11,234,957)

(5,055,147)

(24,528,140)

(67,226,333)

Written-off

(72,009,102)

(57,994)

(78,340)

(72,145,436)

Cost: 31 December 2008

33,959,764

79,849,324

58,356,014

19,671,191

30,340,337

222,176,630

31 December 2008

35,069,109

20,625,102

10,811,755

17,905,056

84,411,022

Depreciation for the year

5,419,460

12,964,246

4,459,253

7,217,762

30,060,721

Depreciation on disposals

(3,631,858)

(3,883,019)

(3,049,217)

(11,785,732)

(22,349,826)

Depreciation on written-off

(7,803,661)

(26,440)

(43,860)

(7,873,961)

31 December 2009

29,053,050

29,679,889

12,177,931

13,337,086

84,247,956

31 December 2008

13,287,752

4,907,016

18,194,768

31 December 2009

13,287,752

4,907,016

18,194,768

31 December 2008

20,672,012

138,290,390

45,335,301

12,012,967

33,815,601

250,126,271

31 December 2009

20,672,012

45,889,258

28,676,125

7,493,260

17,003,251

119,733,906

31 December 2009 Accumulated depreciation:

Allowance for impairment loss:

Net book value:

Depreciation for the year:

100

2008 (all included in administrative expenses)

32,484,816

2009 (all included in administrative expenses)

30,060,721

(Unit: Baht) Separate financial statements Land and

Building and

land

building

Furniture

Office

Motor

improvement

and fixtures

equipment

vehicles

Total

33,959,764

178,266,515

38,245,567

16,256,748

40,920,140

307,648,734

Additions

3,331,980

301,544

3,147,820

6,781,344

Disposals

(26,408,089)

(1,224,354)

(2,370,096)

(24,528,140)

(54,530,679)

Written-off

(72,009,102)

(57,994)

(72,890)

(72,139,986)

Cost: 31 December 2008

33,959,764

79,849,324

40,295,199

14,115,306

19,539,820

187,759,413

31 December 2008

35,069,109

15,066,992

9,086,616

15,649,967

74,872,684

Depreciation for the year

7,849,921

3,019,155

5,124,305

21,412,841

31 December 2009 Accumulated depreciation:

5,419,460

Depreciation on disposals

(3,631,858)

(567,210)

(2,094,305)

(11,785,733)

(18,079,106)

Depreciation on written-off

(7,803,661)

(26,440)

(40,801)

(7,870,902)

31 December 2009

29,053,050

22,323,263

9,970,665

8,988,539

70,335,517

Allowance for impairment loss: 31 December 2008

13,287,752

4,907,016

18,194,768

31 December 2009

13,287,752

4,907,016

18,194,768

31 December 2008

20,672,012

138,290,390

23,178,575

7,170,132

25,270,173

214,581,282

31 December 2009

20,672,012

45,889,258

17,971,936

4,144,641

10,551,281

99,229,128

Net book value:

Depreciation for the year: 2008 (all included in administrative expenses)

24,798,328

2009 (all included in administrative expenses)

21,412,841

The Company has mortgaged its land and building with a total net book value as at 31 December 2009 of Baht 41.4 million (31 December 2008: Baht 43.0 million) to secure the Companyâ&#x20AC;&#x2122;s short-term loans obtained from a financial institution. 13.

Short-term loans from financial institutions (Unit: Baht)

Interest rate (percent) Short-term loans from financial institutions Total

Consolidated

Separate

financial statements

2009

2008

2009

2008

1,756,398,955

2,061,565,058

150,000,000

383,171,308

1,756,398,955

2,061,565,058

150,000,000

383,171,308

MLR+0.25 to MLR+1.25

101

Raimon Land Public Company Limited The Company has a short-term loan of Baht 30 million from a financial institution which carries interest at MLR plus 0.25 percent per annum and is secured by the mortgage of partial land and building of the Company. During the current year, the repayment schedule of this loan is extended to be repaid in April 2010. On 2 December 2009, the Company entered into an additional short-term loan agreement amounting to Baht 120 million which carries interest at MLR plus 1.00 percent per annum and will be due in March 2010. The loan is secured by the mortgage of partial land of the Company, a guarantee provided by a subsidiary, the pledge of a promissory note, and the transfer of the beneficiary rights under sale proceeds relating to and arising from the subsidiary’s land to the lender. Subsequently, on 29 January 2010, the Company made full payment of the short-term loan amounting to Baht 120 million. Raimon Land Property Company Limited On 21 April 2008, Raimon Land Property Company Limited entered into a short-term loan agreement of Baht 385 million with a local bank. Interest on the loan is charged at MLR plus 1.25 percent per annum and the loan repayment will be due in April 2009. During the year, the subsidiary extended the maturity date of the outstanding balance of the short-term loan as at 31 December 2009 amounting to Baht 325 million to April 2010. The loans are secured by the mortgage of the land and construction of the subsidiary’s project, the pledge of share certificates of the subsidiary, a guarantee provided by the Company, and the transfer of the beneficiary rights under the insurance policy for the project to the lender. On 29 January 2010, the subsidiary made full payment of the balance of short-term loan. Raimon Land Park View Development Company Limited On 21 August 2008, Raimon Land Park View Development Company Limited entered into a short-term loan agreement with a local bank. The facility, amounting to Baht 1,310 million, is to be used to repay the subsidiary’s debenture. Interest on this loan is charged at MLR plus 1.25 percent per annum and loan repayment is due by August 2009. The loan is secured by the mortgage of the land and construction of the Company’s project and the subsidiary’s project, a guarantee provided by the Company, and the transfer of the beneficiary rights under the insurance policy for the subsidiary’s project to the lender. As at 31 December 2009, the subsidiary has an outstanding balance of a short-term loan amounting to Baht 1,281 million, the maturity date of which was extended to February 2010. Under the loan agreement, the subsidiary has to maintain an outstanding balance of Baht 25.1 million in a savings account as a reserve for interest payment, for a period of 3 months.

102

14.

Long-term loans from financial institutions The Company and its subsidiaries had secured long-term loans from local financial institutions as follows: Loans

Consolidated

Balance

Interest rate

(Million Baht)

(percent per annum)

financial

statements 2009 1) Loan facilities of Baht 1,780 million

1,457.9

Loan repayment conditions

Collateral

Separate financial statements

2008 1,077.4

2009

2008

1,457.9

1,077.4

MLR (Loan facility of

Due whenever ownership of a

Mortgage of the land and construction of the

from a commercial bank consist of

Baht 1,530 million)

condominium unit is

Company’s condominium project and the transfer

- Baht 1,530 million (the Company

MLR+0.5 (Loan

transferred to a customer, or

of the beneficiary rights under the insurance policy

entered into a loan agreement on 25

facility of Baht 250

in full within 1 year 6 months

for the project to the lender.

November 2005).

million)

(Baht 250 million), 4 years (Baht 1,300 million) and 5

- Baht 250 million (the Company entered into a loan agreement on 24

years (Baht 230 million) from

August 2009)

the first drawdown date, whichever come first.

2) Loan facilities of Baht 5,000 million

1,803.5

1,256.0

Average MLR

Due by 30 June 2012 or due

Mortgage of land and construction of the

from three local commercial banks.

after 6 months whenever

subsidiary’s condominium project, the pledge of

(Taksin Properties Company Limited

ownership of a condominium

share certificates of the subsidiary and Taksin Hotel

(The subsidiary of Taksin Hotel

unit is transferred to a

Holding Company Limited, guarantee provided by

Holding Company Limited))

customer, whichever come

Taksin Hotel Holding Company Limited’s

first.

shareholders (in proportion to the shareholding), leasehold rights, the transfer of beneficiary rights under purchase and sale agreements in project’s condominium units, and the transfer of beneficiary rights under insurance policy for the subsidiary’s project to the lender.

Total

3,261.4

Less: Current portion

(1,457.9)

Net

1,803.5

2,333.4

1,457.9

1,077.4

(1,457.9)

2,333.4

1,077.4

103

Raimon Land Public Company Limited The loan agreements contain covenants that, among other things, require the Company to maintain certain debt to equity and debt service coverage. However, with the approval of the lender, the Company was not required to maintain those financial ratios for the consolidated financial statements as at 31 December 2009. As at 31 December 2009, the long-term loan facilities which have not yet been drawn down amounted to Baht 256.3 million. Taksin Properties Company Limited (The subsidiary of Taksin Hotel Holding Company Limited) On 30 June 2008, Taksin Properties Company Limited (the subsidiary) entered into long-term loan agreements with a group of lenders formed by three local banks, granting Baht 5,000 million divided into 2 facilities. The first facility, amounting to Baht 500 million, is to be used to purchase land to develop a project of the subsidiary and/or to repay the debentures of Taksin Hotel Holding Company Limited and the second facility, amounting to Baht 4,500 million, is to be used to construct and develop a project of the subsidiary. As at 31 December 2009, the long-term loan facilities not yet drawn down amounted to Baht 3,196.5 million. 15.

Long-term debentures (Unit: Baht) Consolidated financial statements 2009

2008

Long-term debentures

351,560,584

Less: Current portion

(351,560,584)

Net

Movements in the long-term debentures account are summarised below. (Unit: Baht) Consolidated financial statements Balance as at 1 January 2009 Add: Amortisation of deferred front end fee Less: Repayment Balance as at 31 December 2009

104

351,560,584 8,439,416 (360,000,000) -

Contemporary Property Company Limited During the first quarter of the year 2009, Contemporary Property Company Limited made partial payment of the debentures amounting to Baht 35 million. On 16 July 2009, the subsidiary entered into a settlement agreement with an overseas financial institution, whereby the subsidiary is to make a payment of Baht 230.0 million to settle debentures of Baht 325.0 million and accrued interest of Baht 1.5 million. The subsidiary therefore recorded the difference of Baht 96.5 million as “Gain on debt settlement” in the subsidiary’s income statements for the current year. 16. Warrants Presented below is a summary of warrants to the Company’s directors and employees (RAIMON-W2): (Units) RAIMON-W2 Number of warrants issued

65,678,400

Exercised during 2004 to 2008

(5,690,566)

Outstanding units as at 31 December 2008

59,987,834

Exercised during 2009 Expired during 2009

(59,987,834)

Outstanding units as at 31 December 2009

On 20 April 2009, the outstanding warrants were expired and cancelled. 17. Dividend/Share capital On 2 March 2009, meeting of the Company’s Board of Directors No. 2/2009 approved the offsetting of the balance of share discount against inappropriate retained earnings, amounting to Baht 208,584,691. The Company offset this transaction during the first quarter of the current year. On 27 March 2009, the Extraordinary General Meeting No. 1/2009 of the Company’s shareholders approved the following significant resolutions: 1)

Approved the payment of an interim dividend of Baht 0.093 per share, or a total of Baht 278.4 million, on 30 March 2009, divided into the stock dividend and cash dividend as follows: a)

A stock dividend of 0.0837 shares for every one existing ordinary share, a total of Baht 250.6 million.

A cash dividend of Baht 0.0093 per share, a total of Baht 27.8 million.

105

The resolutions relating to the Company’s registered share capital are as follows: a)

The reduction of the Company’s registered share capital from Baht 4,172,060,340 (4,172,060,340 ordinary shares at a par value of Baht 1 each) to Baht 3,061,586,485 (3,061,586,485 ordinary shares at a par value of Baht 1 each) by canceling 1,110,473,855 unissued ordinary shares at a par value of Baht 1 each, a total of Baht 1,110,473,855. The Company registered the reduction of its registered share capital with the Ministry of Commerce on 27 March 2009.

The

increase

the

Company’s registered share capital from Baht

3,061,586,485 (3,061,586,485 ordinary shares at a par value of Baht 1 each) to Baht 3,312,173,403 (3,312,173,403 ordinary shares at a par value of Baht 1 each) by issuing 250,586,918 additional ordinary shares at a par value of Baht 1 each, a total of Baht 250,586,918, to support the distribution of the stock dividend and offering these shares to existing shareholders. As a result, the Company’s issued and

paid-up

capital increased

from Baht 2,999,798,651

(2,999,798,651 ordinary shares at a par value of Baht 1 each) to Baht 3,250,385,569 (3,250,385,569 ordinary shares at a par value of Baht 1 each). The Company registered the increase in its registered, issued and paid-up share capital with the Ministry of Commerce on 30 March 2009. 18.

Statutory reserve Pursuant to Section 116 of the Public Limited Companies Act B.E. 2535, the Company is required to set aside to a statutory reserve at least 5 percent of its net income after deducting accumulated deficit brought forward (if any), until the reserve reaches 10 percent of the registered capital. The statutory reserve is not available for dividend distribution.

106

19.

Expenses by nature Significant expenses by nature are as follow: (Unit: Baht) Consolidated

Separate

financial statements

2009

2008

2009

2,296,856,786

1,773,922,739

951,691,272

1,243,374,501

Salary and other employee benefits

80,200,702

91,809,180

80,200,702

91,809,180

Directors’ and management’s

44,443,780

49,451,133

44,443,780

49,451,133

Loss on severance compensation

28,064,198

Depreciation and amortisation expenses

34,356,528

36,606,408

22,375,315

25,586,588

Specific business tax and transfer fees

68,197,583

31,965,664

1,299,314

2,073,658

Other selling expenses

94,260,272

341,883,464

45,221,058

120,973,496

82,157,339

73,730,014

228,189,991

188,904,160

273,776,001

9,999,930

Cost of residential condominium units sold

2008

remuneration

Loss on disposal / written-off of unused buildings and equipment Loss on steel contract cancellation Loss on diminution in value of land awaiting sale Doubtful account in short-term loan to subsidiary Loss on diminution of investment in subsidiary

As a result of a decrease in the market price of steel, a subsidiary canceled a contract to purchase steel with a supplier in May 2009. The subsidiary therefore suffered a loss of Baht 228.2 million as a result of this steel contract cancellation, and this was included in administrative expenses of the current year. The contract cancellation was considered and approved by a meeting of the subsidiary’s Board of Directors. 20.

Corporate income tax Corporate income tax for the year 2009 was calculated from net income before tax for the current year of a subsidiary company, after adding back expenses and deducting income which are disallowable for tax computation purposes. The Company and its subsidiaries were not liable for corporate income tax for the year 2008 due to tax losses brought forward from prior years.

107

21.

Earnings per share Basic earnings (loss) per share is calculated by dividing the net income (loss) for the year by the weighted average number of ordinary shares in issue during the year, after adjusting the number of ordinary shares to reflect the impact of the stock dividend as discussed in Note 17 to the financial statements. The prior year’s basic earnings per share have been recalculated as if the stock dividend had been distributed at the beginning of the earliest year reported. No presentation of diluted earnings per share for the year ended 31 December 2008 from RAIMON-W2 warrants was made since the exercise price of warrants was higher than the average fair value of the Company’s ordinary shares during the year.

22.

Provident fund The Company and its employees have jointly established a provident fund in accordance with the Provident Fund Act B.E. 2530. The fund is contributed to monthly by employees, at the rate of 3 percent and 5 percent of their basic salaries, and by the Company at the rate of 5 percent of employees’ basic salaries, and will be paid to employees upon termination in accordance with the rules of the fund. The fund is managed by Kasikorn Thai Asset Management Company Limited. During 2009, the Company contributed Baht 4.6 million (2008: Baht 4.8 million) to the fund.

23.

Commitments and contingent liabilities

23.1 Capital commitments a)

As at 31 December 2009, the Company and its subsidiaries had commitments of approximately Baht 4,733.6 million (separate financial statements: Baht 263.6 million) in respect of design and construction contracts of its project.

As at 31 December 2009, a jointly controlled entity had commitments of approximately Baht 78.0 million (in proportion to the Company of Baht 39.8 million) in respect of design and construction contracts of its project.

23.2 Long-term service commitments The Company and a subsidiary had a commitment in respect of agency fees of a project to pay under the “Sole Agency Agreement” at the rate of 1 to 4 percent of project units’ gross sale price. 23.3 Guarantees As at 31 December 2009, the Company has provided guarantees totaling Baht 826.7 million (in proportion to the Company) for loans from banks on behalf of the jointly controlled entities.

108

24.

Segment information The Company’s and its subsidiaries’ business operations involve principally a single industry segment, property development, and are carried on in the single geographic area of Thailand. As a result, all of the revenues, operating income (losses) and assets as reflected in these financial statements pertain to the aforementioned industry segment and geographic area.

25.

Financial instruments

25.1 Financial risk management The Company and the subsidiaries’ financial instruments, as defined under Thai Accounting Standard No. 32 “Financial Instruments: Disclosure and Presentations”, principally comprise cash and cash equivalents, unbilled completed work, loans receivable, investments, trade accounts payable, short-term and long-term loans. The financial risks associated with these financial instruments and how they are managed is described below. Credit risk Credit risk refers to the risk that a counter party will default on its contractual obligations, resulting in a financial loss to the Company and the subsidiaries. The Company and the subsidiaries are exposed to credit risk primarily with respect to unbilled completed work, loans receivable and other accounts receivable. The Company and the subsidiaries’ management control such risk by establishing credit limits for customers and counter parties and analysing their financial position on an ongoing basis. As a result, the Company and the subsidiaries do not expect to incur material financial losses. The Company and the subsidiaries are not exposed to concentrations of credit risk because they have a variety of customer base and a large number of customers. In addition, the ownership in residential condominium units is not transferred to the customers until full payment has been received. The maximum exposure to credit risk is therefore limited to the carrying amount of unbilled completed work, loans receivable and other receivables as stated in the balance sheet.

109

Interest rate risk The Company and the subsidiariesâ&#x20AC;&#x2122; exposure to interest rate risk relates primarily to their cash at banks, loans receivable, short-term loans and long-term loans. However, since most of the Company and the subsidiariesâ&#x20AC;&#x2122; financial assets and liabilities bear floating interest rates or fixed interest rates which are close to the market rate, the interest rate risk is expected to be minimal. Significant financial assets and liabilities as at 31 December 2009 classified by type of interest rate are summarised in the table below, with those financial assets and liabilities that carry fixed interest rates further classified based on the maturity date or the repricing date if this occurs before the maturity date.

110

(Unit: Million Baht) Consolidated financial statement Fixed interest rates Within

1-5

Over

Floating

Non-interest

1 year

years

5 years

interest rate

bearing

Effective Total

interest rate

(% p.a.) Financial Assets Cash and cash equivalent Restricted bank deposits

333.5

0.5

334.0

0.25, 0.50

1.5

25.4

26.9

2.00, 0.25

939.7

13.19

1.5

939.7

358.9

0.5

1,300.6

1,756.4

MLR+0.25 to

551.6

10.00, 15.00

3,261.4

Long-term loans to jointly controlled entities Financial liabilities Short-term loans from financial

institutions

Short-term loans

MLR+1.25

from major shareholder Long-term loans from

MLR, MLR+0.50

financial institutions

and Average MLR 551.6

5,017.8

5,569.4 (Unit: Million Baht)

Separate financial statement Fixed interest rates Within

1-5

Over

Floating

Non-interest

1 year

years

5 years

interest rate

bearing

Effective Total

interest rate

(% p.a.) Financial Assets Cash and cash equivalent Restricted bank deposits Short-term loans to

79.2

0.2

79.4

1.5

1,173.8

939.7

1,175.3

939.7

79.2

0.2

2,194.4

150.0

0.25, 0.50 2.00 8.00, 10.00

subsidiaries and related company Long-term loans to

13.19

jointly controlled entities Financial liabilities

financial

MLR+0.25, MLR+1.00

Short-term loans from institutions

Short-term loan

215.6

10.00

551.6

10.00, 15.00

1,457.9

from subsidiary Short-term loans from major shareholder Long-term loans from

MLR, MLR+0.50

financial institutions 767.2

1,607.9

2,375.1

111

Foreign currency risk Foreign currency risk is the risk that the value of a financial instrument will fluctuate because of changes in foreign exchange rates. The Company has a significant foreign currency risk in respect of loans and purchase of investment payable denominated in foreign currencies. The Company manages its exposure to foreign currency risk by considering purchase/sale of forward contracts from time to time so as to reduce exposure to the foreign currency risk which may incur. The Company and the subsidiaries had no forward contracts outstanding at the balance sheet date. As at 31 December 2009, the Company had outstanding balances of financial liabilities denominated in foreign currencies amounting to USD 16.3 million. 25.2 Fair values of financial instruments Since the majority of the Company’s financial instruments are short-term in nature or bear floating interest rates, their fair value is not expected to be materially different from the amounts presented in the balance sheets. A fair value is the amount for which an asset can be exchanged or a liability settled between knowledgeable, willing parties in an arm’s length transaction. The fair value is determined by reference to the market price of the financial instrument or by using an appropriate valuation technique, depending on the nature of the instrument. 26.

Capital management The primary objective of the Company’s capital management is to ensure that it has an appropriate financial structure and preserves the ability to continue its business as a going concern. According to the balance sheet as at 31 December 2009, the Group’s debt-to-equity ratio was 2.9:1 (2008: 2.1:1) and the Company’s was 1.1:1 (2008: 0.7:1).

27.

Approval of financial statements These financial statements were authorised for issue by the Company’s Board of Directors on 2 March 2010.

112

MISSION STATEMENT The mission statement for Raimon Land Plc. embodies the following key elements: Raimon Land is committed to providing its customers with innovative products that exceed their expectations by fully understanding their needs and aspirations. As a leading Thai real estate developer, Raimon Land will strive to improve the quality of property development in the country through utilisation of best practices in all construction disciplines as well as through the establishment of new standards in estate planning, environmental controls and ongoing management. Raimon Land will ensure that it conducts all its business in a fair and transparent manner, dealing honestly with its customers, suppliers, contractors and vendors and with open communication channels for any stakeholder to express themselves to management and directors. Raimon Land will act as a good corporate citizen, encouraging and supporting civic improvement, sound charitable causes, education and envir onmental protection. Raimon Land will seek to create a working environment for its staff that recognises and rewards excellent performance, provides equal opportunities for all staff to grow within the company to reach their full career potential, and offers job satisfaction and pride in the company. Raimon Land is committed to financial stability, market share growth, sustainable profit growth and protection of shareholder value. As its general corporate objective, Raimon Land seeks to establish new standards in design, convenience, functionality and value in property development in Thailand.

113

Raimon Land Plc., 22nd Floor, Unit 2201-3, The Millennia Tower 62 Langsuan Rd., Lumpini, Pathumwan, Bangkok 10330 Thailand Tel: 0 2651 9601 Fax: 0 2651 9614 E-Mail: info@raimonland.com