crane : annual report 2008

ANNUAL REPORT 2008

CHUKAI PUBLIC COMPANY LIMITED

Contents

Our Vision Financial Highlights 1 Message from the Chairman 2 Audit Committee’s Report 3 General Information 4 Corporate Information 5 Company Background 6 Business Operation 8 Risk Factors 13 Major Shareholders 15 Organization Chart 16 Management Structure 17 Corporate Governance 25 Internal Information Control 30 Internal Control 31 Dividend Policy 32 Related Transactions 33 Report of Board of Directors’ Responsibilities 38 Details of Executive and Authorized Directors of the Company 39 Details of Executive and Authorized of the Company and subsidiaries 48 Financial Status and Operating Results Analysis 50 Auditor’s Report & Financial Report 52

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Financial Highlights

Unit : Million Baht

2006 Common control

+ / - (%)

2007 Consolidat

e

+ / - (%)

2008 Consolidat

e

+ / - (%)

Current Assets Total Assets Current Liabilities Total Liabilities Total Shareholders’ Equity

285.22 1,591.65

479.28972.91618.75

- 25.27- 0.70

- 70.75- 50.00

+ 280.38

274.88 1,651.59

497.27954.02697.57

- 3.63 + 3.77 + 3.75 - 1.94

+ 12.74

321.631,925.59

671.34981.92943.67

+ 17.01+ 16.59+ 35.00

+ 2.92+ 35.28

Revenue from sales Revenue from rental and transportation services Total Revenue Gross profit EBITDA Net Profit

249.22

477.71

726.92

243.16

332.44

21.83

- 19.30- 2.56- 9.03

- 13.15+ 24.25- 16.75

253.86

467.45

721.31

292.93

388.50

78.82

+ 1.86

- 2.15

- 0.77

+ 20.47

+ 16.85

+ 261.03

316.36

473.19

789.56

256.03

369.05

31.55

+ 24.62

+ 1.23

+ 9.46

- 12.60

- 5.01

- 59.97

Current ratio (times) Debts to Equity (times) Debt Service Coverage Ratio (times) Return on Equity (%) Gross Profit Margin (%) Net Profit Margin (%)

0.601.57

4.67 4.44

33.453.00

0.55

Balance Sheet

Statements of Income

Financial Ratio Analysis

0.481.041.378.476.13

3.85 11.9832.43 40.61

10.93 4.00

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Massage from the Chairman Dear All Shareholders 2008 was one of the most important year with dynamic growth and great development of Chu Kai Public Company Limited (“the Company”) and its subsidiaries. The outstanding performance in 2007 resulting the Company to be approved for Initial Public Offering (IPO) and be a listed company in the Market for Alternative Investment (mai) on 13th February 2008. This successful achievement was mainly from the fundamental of the company as well as the strong intention, sacrifice and unity of all level of our employees having the shared goal for the strongest growth and continuous development of the company.

Although the subprime mortgage crisis in the United States affected widely to global economy situation leading to investment and private consumption grew slowly in 2008; the Company, with its strong fundamental and Customer Relationship Management system as well as the expansion of rental business to neighboring countries, i.e. Laos and Vietnam and its diversification to offshore works helped the Company to maintain its standard revenue goal. The Company’s total revenue in 2008 was increased at Baht 790 Million compared to total revenue in 2007 at Baht 721 Million or increased by 9.46 percent.

The Company continues to focus on human resources in order to improve not only the Company performance but to improve staff satisfaction and their quality of lives, with a shared goal for each business unit to lead in service excellence. The Company is committed to deliver utmost sustainable returns to all our shareholders and stakeholders.

Chu Kai Public Company Limited was firstly incorporated in 1990 under the name of The Crane Services Company Limited (one of Chu Kai Public Company Limited’ s four subsidiary companies) with a strong intention to be a one stop shop for cranes, construction machinery and all material handling needs for industrial factories and other infrastructure construction both private and state enterprises, as well as the strong intention to provide the best possible services with appropriate costs, sharing and caring following Thai Style disposition and maintaining cash from services providing to be in Thais’ hands. While there are a great number of cranes and other construction machinery rental business operators from overseas, Chu Kai Public Company Limited today remain its same principles and intention to provide the best possible services and maintain our quality up to the Global Operating Standard with excellent understanding according to Thai Style disposition.

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(Mr. Thongchai Praerangsi) Substitute Chairman of the Board of Directors and

Chief Executive Officer

Audit Committee’s Report The Audit Committee of Chu Kai Public Company Limited comprises of 3 persons as follows: Mr. Vacharin Duangdara, Mr.Jessada Promjart and Mrs. Werawan Boonkwan. All audit committee are independent directors and have qualification as designated by SET During the year, audit committee performs the duties assigned by the company’s board of directors by holding 6 meetings under the cooperation with management, internal and external auditors. The scope of duties and responsibilities are summarized as follows: 1. Verifying the accuracy and adequacy of financial statement Verified quarterly and yearly financial statement for the year 2008 with the cooperation of external auditor and management as well as provided suggestion and opinion regarding financial report. 2. Reviewing the appropriate and effective of internal system. To ensure that the Company maintains an appropriate and efficient internal control system by reviewing with external auditor as well as internal audit personnel, i.e. review the efficiency of internal control report year 2008, review the result of internal audit for rental and administrative department of subsidiaries, purchasing section and inventory section of Chu Kai Public Company Limited. 3. Reviewing the adequacy of risk management system. Reviewed and revised risk management system such as financial risk, operational risk, investment risk and etc. 4. Reviewing the company’s business practice conform to related laws. Acknowledged related laws regarding securities and stock exchange, regulations of the securities exchange commission and stock exchange. 5. Considering the appointing external auditor. Considered and proposed to the board of directors for consideration an annual general meeting of shareholders year 2009 for resolution in appointing Mr. Atipong Atipoangsakul and/or Mr. Bunjong Pichayaprasat or other Certified Public Accountants from ANS Audit Co., Ltd. to be an external auditor together with the consideration of the auditor’s remuneration for the year 2009. 6. Considering the disclosure of related transaction and conflict of interest transaction Acknowledge the related transaction which had been disclosed in financial report and provided the opinion that related transaction with the conflict parties were treated under normal business practice and number of transactions continuously reduced from previous year. For the related transactions between the company and directors were complied with agree upon contract as well as financial support from directors with no interest charge were using for liquidity purpose.

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

( Mr. Vacharin Duangdara ) Chairman of the Audit Committee

General Information

Securities Registrar Company : Thailand Securities Depository Company Limited Address : The Stock Exchange of Thailand Building, 62 Rachadapisek Road, Klongtoey, Bangkok 10110 Telephone : 0-2229-2800, 0-2654-5599 Facsimile : 0-2359-1259

Auditor

Auditor : Mr.Prawit Viwanthananut Certified Public Accountant No .: 4917 Company Name : ANS Audits Company Limited Telephone : 0-2645-0109 Facsimile : 0-2645-0110

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Corporate Information Company Name : Chu Kai Public Company Limited (“CRANE”) Business Type : A services provider in lifting, assembling and installing large equipment or heavy machinery

by cranes, forklifts, container handlers and other machinery, including transportation services by prime movers, trailers and trucks. CRANE also provides sale, refurbishment and after-sale services for used and modified machinery as well as sale of spare parts.

Location : 42/62 Moo 14 Soi Chanyawat 5, Bangna-Trad Road Km. 7, Bangkaew, Bangplee, Samutprakarn 10540

Subsidiary Companies : The Crane Services Co., Ltd (“TCS”) 42/51 Moo 14 Bangna-Trad Rd., Bangkaew, Bangplee, Samutprakarn 10540

The Crane Laem Chabang Co., Ltd. (“TCL”) 195/95 Moo 5 Nongkham, Sriracha, Chonburi 20230

The Crane Rayong Co., Ltd. (“TCR”) 4/2 Moo 4 Nikom Pattana, Ampur Nikom Pattana, Rayong 21180

The Crane Heavy Lift Co., Ltd. (“TCH”) 68/55 Moo 10 Phaholyothin Rd., Khongnueng, Klongloung, Patumthani 12120

Home Page : www.chukai.co.thCompany Registration : 0107548000412 Telephone : 0-2715-0000, 0-2316-2873-7 Facsimile : 0-2316-6574 Registered Capital : 450,000,000 Baht Paid-Up Capital : 450,000,000 Baht

http://www.chukai.co.th/

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Company Background

Group of the Companies has been set up by Mr. Thongchai Praerangsi in 1990 in order to provide rental services of cranes, forklifts and other construction machinery for lifting, assembling and installing large and heavy objects as well as sale of machinery under The Crane Services Co., Ltd. (“TCS”). After the industry-expansion, Mr. Thongchai Praerangsi has set up The Crane Laem Chabang Co., Ltd. (“TCL”), The Crane Rayong Co., Ltd. (“TCR”) and The Crane Heavy Lift Co., Ltd. (“TCH”). In 1997, Mr. Thongchai Praerangsi has set up Chu Kai Co., Ltd. in order to import used cranes and parts from aboard for sell including repair services. There was group restructure in 2004, which CRANE has invested in TCL, TCR, and TCH for 99.99 percent each. CRANE also has invested in TCS for 99.99 percent in 2006. After all the group restructure, CRANE is mainly operated in sell and provide repair services for cranes while its subsidiaries only provide rental service. The details in each significant process are as of the following;

1990 TCS has been established with paid-up capital of Baht 2.00 million to engage with the rental services of

cranes, forklifts and transportation services as well as sale of machinery. TCS was located on Bangna-Trad Road Km. 3.

1991 TCS increased the paid-up capital to Baht 20.00 million for the business expansion. 1992 TCL has been established with paid-up capital of Baht 2.00 million to provide rental services of cranes,

forklifts and transportation services as well as sale of machinery around Laem Chabang Seaport in Chonburi Province.

1994 TCR has been established with paid-up capital of Baht 2.00 million to provide rental services of cranes,

forklifts and transportation services as well as sale of machinery around Mapthaphut Industrial Estate in Rayong Province.

1996 TCH has been established with paid-up capital of Baht 10.00 million to provide rental services of cranes,

forklifts and transportation services as well as sale of machinery around Pathumthani, Ayudthaya, Saraburi and other Southern provinces.

May 26th 1997 In order to separate selling, repairing, and machinery rental services, CRANE has been established with paid-

up capital of Baht 1.00 million on Bangna-Trad Road Km. 7 to import from overseas or purchase domestically used cranes and resell to its subsidiaries (TCS, TCL, TCR, and TCH) and other clients. CRANE shall repair and modify the used cranes before reselling to the customers. Moreover, CRANE was the hub of the repair services of used cranes and the sales of spare parts to its subsidiaries (TCS, TCL, TCR and TCH) and other clients. Its subsidiaries shall mainly provide machinery rental services for lifting, assembling and installing as well as transportation services only.

1999 CRANE has increase its paid-up capital from Baht 1.00 million to Baht 50.00 million by issued new common

shares to the existing shareholders. 2000 TCS had financial problem and got into debt restructuring process with 5 debtors. TCS has total restructuring

debt of Baht 950,234,872.49 (Principal of Baht 607,359,056.88 and Accrued interest of Baht 342,875,815.61)

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December 2001 CRANE imported 410-ton-used-crane. October 30th, 2002 CRANE has increased its paid-up capital from Baht 50.00 million to Baht 100.00 million. May 1st, 2004 CRANE has invested in TCL, TCR, and TCH at the proportion of 99.99 percent each by purchasing shares

from Mr. Thongchai Praerangsi’s group at par value. November 8th, 2004 CRANE has increased its paid-up capital from Baht 100.00 million to Baht 200.00 million. November 2004 CRANE imported 600-ton-used-crane with supplementary. The 600-ton-crane is the most capable crane in

Thailand with highest lifting capacity at that time. June 8th 2005 CRANE has transformed into Public Company Limited July 2005 CRANE imported brand new truck crane to support its expansion, which need high quality machinery and high service standard. October 1st, 2006 CRANE has invested in TCS at the proportion of 99.99 percent by purchasing shares form Mr. Thongchai

Praerangsi’s group at par value. November 21st 2006 CRANE increased its investment in TCL, TCR, and TCH by cash for Baht 15.00 million each. November 23rd 2006 CRANE has been granted the loan in the amount of Baht 280.00 million to purchase land on Bangna-Trad

Km. 22 for 34-1-41 Rais from Today Transport Co., Ltd. (“TDT”) for its future expansion. This loan is used for debt restructuring between TCS and TDT as well.

November 30th 2006 CRANE has increase its paid-up capital from Baht 200.00 million to Baht 350.00 million by offer to private

placement for 50.00 million shares (par value of Baht 1.00 per share) at the price of Baht 2.00 per share, and offer to Mr. Thongchai Praerangsi for 100 million shares (par value of Baht 1.00 per share) at the price of Baht 1.00 per share. The proceed has been used for working capital and invested in TCS at the proportion of 99.99 percent.

March 19th 2007 CRANE has increase its registered capital to Baht 450.00 million (450,000,000 share at the par value of Baht

1.00 per share) for initial public offering to be listed in MAI. February 13th 2008 CRANE was approved for Initial Public Offering (IPO) and was a listed company in the Market for

Alternative Investment (mai)

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Business Operation Type of Business and Nature of Operation The Company and its subsidiaries (The Crane Services Co., Ltd. (“TCS”), The Crane Laem Chabang Co., Ltd. “(TCL”), The Crane Rayong Co., Ltd. (“TCR”), and The Crane Heavy Lift Co., Ltd. (“TCH”) have provided services in lifting, assembling and installing large equipment, heavy machinery and objects in industrial and construction by cranes, forklifts and other machinery. CRANE shall import good quality of used machinery, and repair or maintenance for better quality. Moreover, CRANE also sells modified cranes and repairs cranes for general customers. The main business of CRANE can be divided into three groups as of the following;

1. A service provider in lifting, assembling and installing large equipment, heavy machinery and any object by cranes, forklift, container handler and other machinery for construction and industrial projects as well as logistic services. Services can be provided by project or period of time (daily or monthly basis). The machinery provided by its subsidiaries can be divided into three main groups as of the following;

1.1 Cranes are the machinery that can be used in many industries such as construction, import and export, refinery plants,

power plants, and petrochemical plants. Cranes are used to lift, install, or assemble of large or high equipment, machines, and any objects. Most cranes of The Company are good used cranes imported from Japan.

1.2 Forklifts are middle size machinery that can be used for moving or lifting objects or finished goods in any factories or

seaports. Most forklifts of The Company are good used forklifts imported from Japan, Europe, and America.

1.3 Transportation machinery such as prime movers, flat bed trailers and low bed trailers. This type of machinery is mainly used to transport The Company’s machinery to customer’s site.

2. Sell of modified used cranes since some customers would like to use our machinery in long term and they consider that purchase our machinery is worth than rental.

3. Repairing services of used machinery and sell machinery’s spare parts. This service is mainly set up for our subsidiaries but The Company also provides the service to general customers since CRANE has full equipment, skilled and high experienced mechanics, and variety parts both from domestic and overseas sources.

Main Operation Process

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The Company procures heavy machinery for its operation by importing used good machine from reliable suppliers, mainly from Japan. After inspection and selection by our personnel, following this mechanical inspection the machine is selected for purchase and imported into Thailand, where repairs, modifications and/or overhaul are made where necessary prior to the machinery item being sold on to customers or incorporated into the subsidiaries rental fleet.

Business Goal

To improve our rental services of construction machinery for lifting, assembling and installing as well as transportation services under the Turn Key Service in order to compete with the abroad operators and expand our service internationally.

Services and Distribution Channel

Our service shall provide to both sub contractors and direct end users in the proportion of 80 and 20 percent of rental and transportation service respectively.

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Revenue Structure

2006 2007 2008 Type of Products Operated by

MB Percent MB Percent MB Percent Rental and Transportation Services

Rental Service TCS, TCL, TCR, TCH

401.30 53.42 405.32 54.65 415.98 50.96

Transportation Service TCS, TCL, TCR, TCH

66.73 8.88 48.01 6.47 32.30 3.96

Sell Modified machinery CRANE 249.22 33.17 253.86 34.23 316.36 38.76 Machinery repaired and parts sold CRANE 9.68 1.29 14.13 1.91 24.91 3.05

Other Income CRANE, TCS,

TCL, TCR, TCH 24.30 3.24 20.29 2.74 26.70 3.27

Total 751.23 100.00 741.60 100.00 816.25 100.00

Remarks : Proportion of revenue from Rental and Transportation Services and Sell modified machinery shall vary according to industry situation and rivalry during each period. Main Customers The Company main customers can be divided into three main groups as of the following; 1. Factory industry (accounted for 58 percent of total customers) such as refinery plants, petrochemical plants, power plants, hot-rolled mills, and cold-rolled mills.

2. Construction industry (accounted for 21 percent of total customers) such as construction of infrastructure, foundation, factory building, Government’s projects as well as machinery and related systems installation from those constructions.

3. Import – Export Industry (accounted for 21 percent of total customers) such as sea ports area, warehouse and container depots.

Machinery Acquisition

Machinery acquisition of The Company mainly acquires from used machine. The Company imports these used machinery by average 85 percent from Japan, German, the Netherlands and England; the remaining portion is purchased within Thailand from auction companies and end users. However, if there is shortage of used machinery, The Company may purchase brand new machinery.

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Industry Information Industry that The Company provides services covered the three main industries which are; 1. Factory industry – Information from Industrial Works Department indicated that the number of factory has increased dramatically since the year 2003 which is a good sign for our business. As of December 31st, 2007, Thailand has 126,804 factories and decreased slightly in 2008 by 146 factories and total number in 2008 was 126,658 factories. Moreover, there are a number of requirements from factory industry, i.e. Power Plant , almost the entire of year for their yearly plant maintenance (shut down project), installation of machinery off shore in the Gulf of Thailand and etc. 2. Construction is the industry required to use machine of the company for operation in several processes due to we have several types of machine to service the customers. The value of overall construction of the country in 2008 is expected to be 7.69 thousand million baht which is 3.0 percent increased from 2007 and considered as slightly increased ratio due to the slow down of construction condition in Thailand and the construction in public sector is less than the scheduled plan due to the problem of increasing construction cost as resulted from higher price of fuel oil and construction material while the large project , i.e. Mass Rapid Transit Project in Bangkok Metropolis and greater Bangkok areas are only in the initial stage because the serious conflict of political condition, the government is still unable to fully drive any projects. In addition, the construction business in private sector is also show down simultaneously with immovable business, investment in new project is decreased die to the investors and consumers lack of confidentiality from political crisis which had impacted the business trend in 2009 is steady but if the government shall rapidly operate several projects, i.e. 2 routes of mass rapid transit projects in Bangkok and greater Bangkok areas, i.e. the Red Line (Bangsue-Talingchan) and the Violet Line (Bangyai-Bangsue) and acceleration of budget release, etc. to expand the construction growth and may help private sectors to fell confident in vestment. 3. Import – Export Industry – Most transportation is mainly through ocean transportation because of cheaper cost of transportation and larger quantities compare to the other transportation methods. Import – Export industry in Thailand mainly uses Bangkok Sea Port and Laem Chabang Sea Port, which have international standard, high efficiency, and support Super Post Panamax. Laem Chabang Sea Port has capacity of over 6 million T.E.U and Bangkok Sea Port has capacity around 1 million T.E.U for container vessel. Recently this industry primarily uses containers for their services because of convenience of transportation and packaging process; therefore, the number of containers used increase continuously since 2003, and began to decline in the fourth quarter of 2008 due to the significant decrement of demand from client countries and global economic slowdown. These unfavorably factors affected export industry in 2009 to fall continuously and decreased quantity of imported cargo containers and empty containers into the country.

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Competition 1. Competitiveness in factory industry is considered low. Although there are a number of small and medium size companies in the rental services market; but only a few companies are capable to provide lifting, assembling and installing services for valuable and complicated equipment that required high standard of safety system of operation. The company values the need and expectation of customers and is continually selected to serve customers in this industry. 2. Competitiveness in installing and transportation for construction industry is moderate. Most of project in this construction industry is long-term project that required continually supply of machinery on rental basis. There are only a few machinery rental suppliers who have sufficient machinery to supply for this kind of project. 3. Competitiveness in Import – Export industry is low. There are high demands in this industry while the supply is quite low. Most of container depots have some limited circumstance in their daily business operations, for example required stand by and maintenance period of their machines as well as number and availability of machinery for continually operation. In order to reduce their cost of machinery investment, and cost of related operations, most of container depots and customer in import and export industry decided to rent container handlers from outsource. The company is the leading supplier in rental services of container handlers with high experience of operators, mechanics and related personnel available immediately whenever required by customers. Future Projects

To support the expansion of our company in the future including to reduce the restriction on the provision of additional space of the company’s premise in presence on Bangna-Trad Road, Km. 7, the company therefore have planned to move our premise to Bangna-Trad Road, Km. 22 on more than 34 rai which is sufficient to support the company’s growth in long term, moreover, such location is also suitable for marketing and operation due to it is located along Bangna-Trad road and the company has approved group of persons which is consisted of Mr. Wasawat Ratcha-arj, Mr. Montri Ounsud and Mr. Chawalit Luangpattararak to be the architects responsible for the designing, drawing, to apply for approval and construction of 2-stories new office. For expenses in movement of our company and construction cost is approx. Baht 50-60 million as the company expects to obtain from cash flow of the company.

In addition, about land where The Crane Heavy Lift Co., Ltd. (“TCH”) shall use as location of the office in present on

Phaholyothin Road where is under the legal dispute. On 6 October 2008, TCH had issued a letter to the Trustee inquiring about the date of auction sale in order to purchase such plot of land. Should TCH is unable to purchase from the creditor, TCH has policy to move the office from Phaholyothin Road to Bangna-Trad Road, Km 7 or Km 22 of which more detail is appeared in the clause titled Risk Factors, No. 8

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Risk Factor

The Company has risk under business operation as of the following;

1. Risk regarding to machinery acquisition : The Company’s machinery are used cranes that mainly imported from Japan and European countries. Those cranes are not newly manufactured from precise manufacturer; therefore, the Company could not specific the acquired schedule. In order to reduce risk from machinery acquisition, the Company spreads out our list of distributors to several countries in Europe and Asia. Therefore, the Company shall have more suppliers both domestically and internationally during the past few years. Moreover, the Company has also imported brand new cranes from Japan during the past 2-3 years. 2. Risk regarding to machinery technicians and engineers : After the acquisition of used cranes, the used cranes shall be passed on to Repair and Maintenance Department. Repair and maintenance process mainly required experienced technicians and engineers; therefore CRANE has been reliable on these 11 technicians and engineers, and would like to have these employees work for long term. In order to reduce risk of machinery technicians and engineers, the Company supports for living place, housing loan, or education loan for those employees. 3. Risk regarding to machinery operators : The Company has assigned each employee to operate specific crane. All large crane drivers must have Third Type of Driving License issued by Department of Land Transport. Each operator shall have the license, skills, and experience to operate the crane. Approximately 40 machinery operators are important for our operation; therefore CRANE has provided them with good remuneration and essential trainings in order to improve their ability for higher machine’s lifting capacity. 4. Risk regarding to the operation life of used cranes : Most of the Company cranes is used cranes with average of useful life between 7 to 17 years so there shall have risk regarding to the condition of cranes. There is more chance of the malfunction of used cranes is higher than the brand new cranes. To minimize the risk, CRANE has purchased only used cranes from well-known distributors as well as set up a preventive maintenance by high experienced technicians and skillful personnel in order to maintain all cranes in good conditions and extend their operation life. 5. Risk regarding to exchange rate : Almost acquired cranes are imported from overseas; therefore the payment shall be made regarding to seller’s currency which is two main currencies (Japanese Yen and EURO Dollars) under the L/C term. CRANE has risk in variable cost of cranes if the exchange rate on contract date and the payment date are different. As of December 31st, 2007, the Company has liabilities in Japanese Yen for ¥ 628.34 million. 6. Risk regarding to loan guarantee for selling machine : In the past, there were limitation of financial institutes in financing the purchase of used cranes; neither have large cranes been widely used. If there is any default, financial institutes have risk regarding cranes liquidation. In order to reduce their risk, the financial institutes usually require sellers to sign buyback contract as well as a collateral contract. CRANE and its subsidiaries signed those two contracts with the leasing companies for several clients. So CRANE and its subsidiaries shall expose to risk on client’s default payment. However, trading of used cranes has been increased dramatically; therefore, CRANE and its subsidiaries have variety choices for financial services to the clients without any default payment guarantee required. CRANE and its subsidiaries have the policy in not signing any collateral contract, which reduce risk regarding to loan from collateral for

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clients. 7. Risk regarding to lawsuit : Under the Company’s normal business operation, CRANE and its subsidiaries shall expose to risk from lawsuit such as risk regarding to loan guarantee for clients, risk from delay registration, or risk from accident claim suit. As of December 31st, 2008, CRANE and its subsidiaries have total of 6 lawsuits; two of them have been finalized and the remaining four lawsuits have been unsettled at value of Baht 131.05 million which all the provision has been booked. In order to reduce risk from the accident, CRANE and its subsidiaries have set up the policy in not conducting buyback guarantee, inform registration transfer restriction, and safety standard in every step including buying insurances for every project. 8. Risk regarding lawsuit of TCH’s operation land : The current TCH’s operation land has been rent from Mr. Thongchai Praerangsi, TCH’s director, and is under the lawsuit. The owner of the land has been bankrupt and the land is under the property of state department. TCH has been asked to leave and pay the rent to the concerned state department. TCH has risk of moving out of the land and paying the accrued rent in the amount of Baht 13.60 million. TCH has submitted the petition to the government officer. In order to reduce risk from the lawsuit, TCH has booked the provision and cease the rental payment to Mr. Thongchai. Moreover, TCH has policy to buy the land from the debtors. If TCH could not buy the land, TCH shall move its office to CRANE’s existing office either on Bangna-Trad Road Km. 7 or Km. 22.

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Major Shareholders

Major shareholders as stated on the shareholder’s book on 30th December 2008 are as follows;

Name Number of Shares %

1. Mr. Thongchai Praerangsi’s group1 295,050,000 65.57 2. Thai NVDR Co., Ld. 40,528,000 9.01 3. Mrs. Sirirat Jarusombuti 9,700,000 2.16 4. Mr. Jak Jamikorn 6,977,300 1.55 5. Mr. Lert Nitheranont 6,389,000 1.42 6. Ms. Karnda Pansukha 4,540,900 1.01 7. Mr. Narathorn Eurfur 4,000,300 0.89 8. Mr. Prachum Malenont 3,700,000 0.82 9. Mrs. Supranee Chaichukiet 3,667,000 0.81 10. Ms. Kanit Limpisuk 2,948,700 0.66 11. Mr. Natachai Srirungsukpinit 2,378,600 0.53 12. Mr. Pornthep Manosubsuk 2,374,700 0.53 13. Others (894 persons) with share less than 0.50 percent 67,745,500 15.05 Total 450,000,000 100.00

Remarks : Mr. Thongchai Praerangsi’s group is included of

Mr. Thongchai Praerangsi 190,010,000 Shares

Ms. Junjira Praerangsi 29,590,000 Shares

Ms. Jiraluck Praerangsi 20,000,000 Shares

Ms. Nateeporn Duangsawasdi 20,000,000 Shares

Ms. Wanida Darachai 20,000,000 Shares

Ms. Jiraporn Praerangsi 15,200,000 Shares

Ms. Janejira Praerangsi 250,000 Shares

Each major shareholder above is not related person as defined by section 258, and is not a shareholder under the same controlling person.

Organization Chart

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Management Structure The Company’s boards and committees can be divided into 4 boards as of the following;

1. Board of Director 2. Audit Committee 3. Executive Board 4. Management

Board of Directors

Board of Directors in regard to the Memorandum of Affidavit on January 26th, 2009 is consisted of :

No. Name Position 1. Mr. Thongchai Praerangsi Substitute Chairman of the Board of Directors / Director 2. Mr. Somsak Sivapaiboon Deputy Chairman of the Board of Directors 3. Mr. Chamnan Ngampojanavong Director 4. Ms.Nateeporn Duangsawasdi Director 5. Ms. Wanida Darachai Director / Company’s Secretary 6. Ms. Jiraluck Praerangsi Director 7. Mrs. Pattanintorn Hlowchitsieng Director 8. Mr. Vacharin Duangdara Chairman of the Audit Committee / Independent Director 9. Mr. Jessada Promjart Audit Committee / Independent Director 10. Mrs. Werawan Boonkwan Audit Committee / Independent Director

Authorized Directors

Authorized Directors of the Company are Mr. Thongchai Praerangsi or Ms. Nateeporn Duangsawasdi co-signs with Ms. Wanida Darachai or Ms. Jiraluck Praerangsi with the Company’s seal.

Authorized of the Company’s Board of Directors

The Board of Directors have set powers, duties, and responsibilities to manage the business of the Company to comply with the law and the Company’s objectives, Articles of Association as well as the resolution of the shareholders’ meeting. However, the Board of Directors may authorize any other directors or other persons to perform any action on behalf of the Board of Directors’ Powers, Duties, and Responsibilities.

Power, Duties, and Responsibilities of the Board of Directors 1) To manage, control, and supervise on the Company’s business according to law, its objectives, Article of

Association, rules and regulations as well as shareholders’ meeting resolution.

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2) To determine the main policies such as financial policy, fund raising policy, cash management policy, accounting policy, inventory management policy, and risk management policy.

3) To determine the Company’s rules and regulations. 4) To approve the annual budget or the additional budget, revise investment budget, make use of the budget, and

supervise the project as plan. 5) To monitor the business of the Company to ensure that targets will be achieved or overachieved, and amend if

there is any problem. 6) To approve for making loan or obtain any credit facilities for normal business operation, including collateral or

loan repayment for normal business operation under any balance according to authorized manual. 7) To review the organization chart and authorized structure including human resource plan, acquiring plan, training

plan, hiring plan, and terminate plan. 8) To determine the remuneration policy regarding to experience, traditional, and laws. 9) To arrange for the preparation and submission of the general information and the audited financial statement at the

end of each accounting period to the shareholders’ meeting for its consideration and approval. 10) To acknowledge of any important audited report and determine the policy to amend the fallacy. 11) To review the sufficiency of its internal control and risk management.

The Audit Committee

The Extraordinary General Shareholders’ Meeting number 2 / 2006 on August 25th, 2006, the Board of Directors’ Meeting number 19 / 2006 on December 8th, 2006 and the Board of Directors’ Meeting number 3/2008 on March 27th, 2008 have been appointed three Audit Committee as of the following;

No. Name Position 1. Mr. Vacharin Duangdara Chairman of the Audit Committee / Independent Director 2. Mr. Jessada Promjart Audit Committee / Independent Director 3. Mrs. Werawan Boonkwan Audit Committee / Independent Director

Powers, Duties, and Responsibilities of Audit Committee Audit Committee has duties and responsibilities regarding to rules and regulation of The Securities and Exchange

Commission and The Stock Exchange of Thailand, and shall directly report to the Board of Directors. Audit Committee’s powers, duties, and responsibilities are 1) To review for the accuracy and adequate disclosure of the Company’s financial statement. 2) To ensure that the Company maintains an appropriate and efficient of internal audit and internal control system, review the independency of internal audit department, and responsible for appointing, transferring, and terminating of internal audit manager. 3) To ensure that the Company complies with the Securities and Exchange Act, regulations of the Stock Exchange of Thailand, or other relevant laws related to the Company. 4) To select and propose for the appointment of the auditor and considering auditor’s remuneration, and attend the meeting

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with external auditor without any of the management at least once a year. 5) To approve that the related transactions or transactions which could create a conflict of interest regarding to regulations of

the Stock Exchange of Thailand are reasonable and for the Company’s best interest. 6) To prepare and disclose Audit Committee’s activities Report in the Company annual report as of the following;

a) To opine of the accuracy and adequate disclosure of the Company’s financial statement. b) To opine of the adequate of the Company’s internal control system. c) To opine that the Company complies with the Securities and Exchange Act, regulations of the Stock Exchange of

Thailand, or other relevant laws related to the Company. d) To opine of the appropriateness of the external auditor. e) To opine on the transactions that could create a conflict of interest. f) The number of the audit committee’s meeting and the attendant of each audit committee. g) Opinion or notice of the audit committee h) Other issues that shareholders or investors should be disclosed under the duties and responsibilities received from the

Board of Directors. 7) To perform any other tasks delegated by the Board of Directors and approved by the Audit Committee. Executive Board

The Board of Directors’ Meeting number 11 / 2006 on September 7th, 2006, and the Board of Directors’ Meeting number 5/2008 on June 26th, 2008 have appointed six of the Executive Management Committee as of the following

No. Name Position 1. Mr. Thongchai Praerangsi Chief Executive Officer 2. Mr. Chamnan Ngampojanavong Chief Financial Officer 3. Ms. Nateeporn Duangsawasdi Executive Officer 4. Ms. Wanida Darachai Executive Officer 5. Ms. Jiraluck Praerangsi Executive Officer 6. Mrs. Pattanintorn Hlowchitsieng Executive Officer

Powers, Duties, and Responsibilities of Executive Management Executive Board is responsible for reviewing and submitting the conclusion report to the Board of Directors especially policy

details to synchronize with the main policy including the comment and recommendation to Chief Executive Officer in order to manage regarding to main policy or any other duties assigned from Board of Directors. Powers, Duties, and Responsibilities of Executive Board are;

1) To determine policies, plans, strategies, and overall management for the Company’s operation in accordance to policies, economics, and competitiveness as presenting to shareholders and proposed to the Board of Directors for approval.

2) To determine business plans, budgets, and authorized power of the Company in order to be approved by the Board of

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Directors. 3) To determine the organization chart and authorized structure including human resource plan, acquiring plan, training plan,

hiring plan, and terminating plan. 4) To examine and monitor the business policies for the effectiveness of business operation. 5) To examine and monitor the Company’s performance in accordance with approved business plans. 6) To approve the transaction with financial institution such as opening bank accounts, making loan, collateral, or other

transaction including buying or selling any land for normal business operation under any balance according to authorized manual.

7) To manage any other delegate tasks from Board of Directors. The approval of transactions and the assigned authorities of Executive Board will not include to any transaction which cause

possible conflict of interest between Executive Board or related persons (as defined by the Securities and Exchange Commission and the Stock Exchange of Thailand) and the Company and its subsidiaries. Furthermore, in case of transaction concerning to the related transaction must be approved by Board of Directors’ meeting and the related persons have no rights to vote in that agenda.

Management

The Company has nine management as of the following;

No. Name Position 11. Mr. Thongchai Praerangsi Chief Executive Officer / Chief Operating Officer 1. Mr. Dhanis Haetanurak Chief Marketing and Operating Officer 12. Mr. Chamnan Ngampojanavong Chief Financial Officer 13. Ms. Nateeporn Duangsawasdi Executive Vice President 14. Ms. Wanida Darachai Executive Vice President 2. Ms. Jiraluck Praerangsi Executive Vice President – Finance and Accounting 3. Mrs. Pattanintorn Hlowchitsieng Executive Vice President 4. Mrs. Chittra Thongsamut Senior Finance Manager 5. Ms. Kuneeon Klakarnkai Accounting Manager

Powers, Duties, and Responsibilities of Chief Executive Officer

1) To make decision on the important matters. To establish missions, purposes, directions, and policies in doing business. To supervise and control the whole business operations, customers’ relationship, and take responsibility to the Board of Directors.

2) To hire, appoint, and reshuffle all the employees as necessary and appropriated. To determine remuneration and terminate all the employees as appropriated.

3) To act as the Company’s representative and authorized person to public concerning related business operation and beneficial to the Company.

4) To determine the credit term such as credit balance, term payment, buying and selling agreement, rental agreement,

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leasing agreement, and amend the credit term. 5) To approve any accrued expenses and advance payment according to company’s authorization manual. 6) To review the fund raising of the Company and propose to the Board of Directors. 7) To appointed any necessary advisory services. 8) To manage any related normal business operation of the Company. 9) To approve department operation plans and approve the request from any department. 10) To delegate any important and necessary operation under Chief Executive Offer’s consideration in accordance with laws

and the Company’s regulations. 11) To manage any operations appointed by the Board of Directors.

The approval of transactions and the assigned authorities of Chief Executive Officer will not be made to any transaction which cause possible conflict of interest between Chief Executive Officer or related persons (as defined by the Securities and Exchange Commission and the Stock Exchange of Thailand) to the Company and its subsidiaries. Furthermore, in case of transaction concerning to the related transaction must be approved by Board of Directors’ meeting and the related persons have no rights to vote in that agenda.

Moreover, in the case of transaction concerning to the related transaction or transaction about acquiring or disposal of assets

of the Company and its subsidiaries as defined by the Stock Exchange of Thailand, this kind of transaction must be approved by shareholders’ meeting and/or any other treatment about criteria and process related to the transaction in complying with the Stock Exchange of Thailand rules and regulations.

Selection of Board Members and Executives

Currently, the Company does not have the Nomination Committee. Potential candidate or person proposed by shareholders shall be considered from experience, knowledge, capability, and qualification set by laws. The Board of Directors shall propose the potential candidates to Shareholders’ meeting for approval. For Audit Committee and Independent Directors shall be considered from experience, knowledge, capability, and qualification set by laws in regarding to the Independent Directors under the Securities and Exchange Commission regulations Re: Application for and Approval of Offer for Sale of Newly Issued Shares. The Audit Committee shall be selected from proposed list by shareholders and approved by shareholders’ meeting afterwards. For Management, Board of Directors shall select from specialist in each branch such as marketing, accounting, financing and etc.

In selecting the Board of Directors as set in the Article of Association can be summarized as follows; 1) Board of Directors consists of five directors, half of which shall live in Thailand. Directors shall have qualifications as set by

laws

2) The Company’s directors will be approved by Shareholders’ meeting under the methods as follows; (a) A shareholder shall have one vote per share for each share held. (b) In selecting Company’s Directors, voting by each shareholder can use all the voting rights to vote for each person. (c) The Directors’ selection vote shall be decided on the basis of the majority of the vote cast. In case of a tie of votes,

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the chairman presiding over the meeting shall have the casting vote. 3) In Annual General Shareholders’ Meeting, the directors shall be terminated by one third of total number of directors. If the

number of directors can not be divided by three, the closet number shall be used. The terminated directors can be selected to be directors afterwards.

Besides the Selection of Board Members, the Company has set the three Independent Directors with the qualification and selection as follows;

1) Independent Directors shall not hold more than 5 percent of voting shares in the Company. 2) Independent Directors shall not involve in management and be the Company’s employee or advisor who receives monthly

remuneration and shall not have power to control the Company, its subsidiaries, and its associated as well as persons who may create a conflict of interest, in the sense that it may obstruct at least one year prior to be appointed as Independent Director.

3) Independent Directors must not be directly or indirectly related to the Company, its subsidiaries, and its associates, or major shareholders, or conflict of interest persons, in the sense that it may obstruct independent assessment at least one year prior to be appointed as Independent Director.

4) Independent Directors is not a close relative with Management, major shareholders of the Company, its subsidiaries, and its associates or conflict of interest persons and is not represent any directors, managements, or major shareholders’ interest.

5) Independent Director has knowledge, experienced and provided independent opinion without the controlling of any persons.

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Directors’ and Management’s Remuneration

Monetary Remuneration 2007 2008

Board of Directors persons Amount (Baht) persons Amount (Baht)

Type

Directors 10 1,570,000.00 121 1,765,000.00 Meeting Allowance and monthly remuneration Executive Directors and Management

102 16,654,303.60 102 17,993,128.86 Salaries, Bonus, and Allowance

Remarks : 1. Two directors resigned in March 2008. 2. One management resigned on March 31st, 2007, and one Executive Director/management resigned on March 16th 2008. Annual General Shareholders’ Meeting approved the directors’ remuneration (meeting allowance and monthly remuneration) for the year 2008

at Baht 4.00 million.

Individual Remuneration1 unit : Baht

No. Name 2007 2008 1. Pol.Maj.Gen Phitak Jarusombuti 2 390,000 90,000 2. Mr. Somsak Sivapaiboon 390,000 420,000 3. Mr. Thongchai Praerangsi 15,000 30,000 4. Mr. Khan Akaworawit 3 15,000 5,000 5. Mr. Chamnan Ngampojanavong 4 - 25,000 6. Ms. Nateeporn Duangsawasdi 10,000 30,000 7. Ms. Wanida Darachai 15,000 35,000 8. Ms. Jiraluck Praerangsi 15,000 35,000 9. Mrs. Pattanintorn Hlowchitsieng 15,000 35,000 10. Mr. Vacharin Duangdara 420,000 460,000 11. Mrs. Werawan Boonkwan 285,000 340,000 12. Mr. Jessada Promjart 4 - 260,000

รวม 1,570,000 1,765,000 Remarks : 1. Director remuneration is consisted of meeting allowance and monthly remuneration. 2. Pol.Maj.Gen Phitak Jarusombuti resigned on March 17th, 2008

3. Mr. Khan Akaworawit resigned on March 16th , 2008.

4. Two directors have been appointed by the Board of Directors’ Meeting number 3/2008 on March 27st , 2008.

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Other Benefits The Company provides 7 personal cars for directors and management with the fuel of 360 liters per person per month. The Company sets up provident fund for its employees on April 27th, 2007 through BT Asset Management Co., Ltd. The

employees pay 2.00 percent of their salary for the provident fund and the Company pays 2.50 percent of employee’s salary to the provident fund.

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Corporate Governance

The Board of Directors has set the good governance principles regarding guidelines of the Stock Exchange of Thailand as of the following;

1. Shareholders’ Rights

Shareholders : Rights and equality of shareholders The Company values and treats all shareholders fairly such as regularly informing the company’s performance directly to

shareholders via the Stock Exchange of Thailand. The Company sends meeting invitation containing details agenda and related information to shareholders 7 days in advance in accordance with the Article of Association. The minutes shall be recorded accurately for shareholders’ follow – up and review. The Company shall provide at least one Audit Committee to receive proxy from any absented shareholders in the meeting. The Company shall set at least one Annual General Shareholders’ Meeting a year. If there is any agenda, the Company shall set up the Extraordinary General Shareholder’s Meeting for approval. Shareholders’ Meeting

The Company has a policy to encourage all directors to attend each shareholders’ meeting. The Board of Directors shall encourage an equal treatment for all shareholders with transparency and simplified handing procedures and facilitate shareholders to exercise their rights to attend meetings and to obtain the Company’s data and information prior to the sessions. Equal opportunities and time allocation shall be provided for all shareholders to express their opinions and raise any questions during the meeting as per the proposed agenda and issues. The proxy shall be provided to any shareholders who could not attend the meeting.

2. Equitable treatment of Shareholders Besides the shareholders’ meeting, the Company has policy for confidential information. The internal confidential

information shall be known by related and authorized persons only. The Directors and Management realized of their duties and responsibilities of forbidding from public disclosure of confidential internal information and shall not use the information for their own benefit including security trading. The management members have to report the changing of security held to SEC under Section 59 of the Securities and Exchange Act B.E. 2535 (A.D. 1992).

Conflicts of Interest

In order to prevent the conflicts of interest, the Board of Directors carefully review any transactions that may cause conflits of interest and has set policy and procedures to prevent management and employee to access inside information for their own benefit s as follows;

- Report of Conflicts of Interest Approval of the related transaction by the Board of Directors must sole be for the best interest of the company. The

transaction pricing must be set as under business terms and conditions. Moreover the related persons or companies shall be absented from the approval meeting. This includes complete disclosure of information for the Company’s benefits as a whole in

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strict conformity with guidelines and methods in SET announcements and regulations. Observations by the Audit Committee on necessity and appropriateness of the transactions shall be included.

3. Roles of Stakeholders Rights of Various Groups of Stakeholders

The company values the right of all groups of stakeholders and equally treat as follows; - All employees shall be equally treated and receive appropriated remuneration. - All loans shall be treated as per terms and conditions on signed agreement. - Treat and responsible to all customers equally and in the best interest of all parties in term of quality of services, after-sale services and strictly honor customers’ information. - Comply with business rules and regulations and treats its competitors professionally and fairly. - Be responsible for communities and socials’ environment.

4. Disclosure and Transparency

Corporate Governance Policy The Board of Directors is concerned with The Principles of Good Corporate Governance by setting the transparency business

operation with specific responsibility. The Company enhances the transparent operations, business ethics, and internal control systems to all business partners, shareholders, and stakeholders.

Report of the Board of Directors

The Board of Directors is responsible for business operation, corporate governance, financial statement, information memorandum disclosure to public in Form 56-1 and Annual Report. The Financial Statement shall be made in regard to the General Accepted Accounting Standard of Thailand. The appropriated policy shall be applied and disclose sufficient information in Notes to Financial Statement.

The Audit Committee, consisted of non-executive directors and independent directors, is appointed to be responsible for the quality of financial statement and internal control system.

Relationship with investors After being listed in the Stock Exchange of Thailand, The Company shall ensure for investor relation unit to public the

Company’s accurate, complete, adequate, timely and transparent disclosure of significant financial and general information including any price impact information. In this regards, an investor relations unit was set up to communicate with institute investors, shareholders, investment analysts, and government authorities. Ms. Jiraluck Praerangsi, Executive Vice President, shall be responsible for investor relation unit and can be reached at 02-715-0000.

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5. Board of Directors’ Responsibility Vision and Leadership

The Board of Directors has consistently performed their duties independently in compliance with standard of corporate governance as follows;

- Determine visions, missions, strategies, objectives, business plans, and budgets of the Company. - Supervise and control the management’s operations in accordance with policies to ensure achievement. - Devise and ensure to have sufficient internal control policy and regularly monitor internal control practice. - Devise and ensure to have appropriate risk management, and monitor the practice regularly for the company’s best interest. - Upgrade the directors by attending seminar held by the Institute of Directors of Thailand (IOD).

Business Ethics

The Company values code of business conducts concerning ethics for Board of Directors, managements, and employees to abide as guidelines in performing their duties to all groups of shareholders and stakeholders with honesty and fairness.

The Balancing of Non-Executive Directors and the combination and separation of position

The structure of Board of Directors consists of six of executive directors and four of non executive directors, four of non executive directors are consisted of three independent directors and one qualified outsource director.

The Chairman of the board of directors and Chief Executive Officer are two separate persons. The Company has the

balancing of Chairman of Board of Directors and Chief Executive Officer by not allowing a person or group of persons exercise decisive authority solely and clearly determine the responsibilities. For any important decisions, the approval from the Board of Directors or Shareholders’ is required. Moreover, none of authorized persons or group of persons is allowed for approval of conflicted of interest transaction.

Directors and management’s remuneration

Directors’ remuneration : The Company has clearly and transparency policy for directors’ remuneration. The remuneration is at the appropriated level and in line with those in the industry, and has been approved from Shareholders’ Meeting.

Management’s remuneration : The Company offers the remunerations for managements as per principles and policies set by the Company’s Board of Directors on the basis relating to the Company’s performance and each management’s performance.

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Board of Directors’ Meeting The Company set the policy for Board of Directors’ Meetings at least once a quarter, and may arrange for additional special

meetings as necessary. For each meeting, the Company sends meeting invitation together with the details agenda and documents seven days in advance so that member of the Board will have sufficient time to review. In the year 2007, there are 8 Board of Directors’ meeting and each member attended the meeting as follows;

Attended Meeting /

Total Meeting Name Position

2007 2008

1. Mr. Thongchai Praerangsi Substitute Chairman of the Board of Directors / Director 8/8 7 / 8 2. Mr. Somsak Sivapaiboon Deputy Chairman of the Board of Directors 8/8 7 / 8 3. Mr. Chamnan Ngampojanavong 1 Director - 5 / 8 4. Mr. Nateeporn Duangsawasdi Director 7/8 7 / 8 5. Ms. Wanida Darachai Director / Secretary to the Board of Directors 8/8 8 / 8 6. Ms. Jiraluck Praerangsi Director 8/8 8 / 8 7. Mrs. Pattanintorn Hlowchitsieng Director 8/8 8 / 8 8. Mr. Vacharin Duangdara Chairman of the Audit Committee / Independent Director 8/8 8 / 8 9. Mr. Jessada Promjart2 Audit Committee / Independent Director - 5 / 8 10. Mrs. Werawan Boonkwan Audit Committee / Independent Director 8/8 8 / 8

Remarks : 1. Mr. Chamnan Ngampojanavong has been appointed on April 16th , 2008 from the Board of Directors’ Meeting dated March 27th, 2008. 2. Mr. Jessada Promjart has been appointed by the Board of Directors’ Meeting on March 27th , 2008.

Sub-Committee

Extraordinary General Shareholders’ Meeting number 2 / 2006 on August 25th, 2006, Board of Directors’ Meeting number 19 / 2006 on December 8th, 2006, and Board of Directors’ Meeting number 3/2008 on March 27th, 2008 have appointed three Audit Committees with holding term of three years to investigate the Company’s operation. Audit Committee’s Meeting shall be arranged once a quarter or as necessary.

The Board of Directors’ Meeting number 11 / 2006 on September 7th, 2006, and Board of Directors’ Meeting number 5/2008 on June 26th, 2008 have appointed six of Executive Management Committee. The Executive Management Committee shall have meeting with management team two times a month or as necessary.

Currently, the Company does not have sub-committee for remuneration, but set the remuneration at the appropriated level in line with those in the same industry. The Company’s performance shall be proposed to Shareholders’ Meeting prior for approval.

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Internal Control System and Internal Audit The Company values the significant of internal control system in both management and operational level by clearly

determines in writing the scope of duties and authorities for performers, Board of Directors, and Management Team. The Company controls and supervises the use of assets for ultimate benefit. The separation of duties among performers, controllers, and evaluators has set in order for the proper check and balance. Furthermore, the Company has set up internal control for financial system by reporting financial reports to related management. Moreover, ANS Audit Co., Ltd. which is the company’s auditor has annually review internal control system and agreed that the Company has proper and sufficient internal control system.

In order to continuously maintain the efficiency of the Company’s internal control , the Company has appointed AI Consultant (Thailand) Co., Ltd. to review internal control system for the year 2007, contract with AI Consultant (Thailand) Co., Ltd. was expired on December 31st , 2007 and was renewed again on May 14th, 2008 to assure that the main duties and significant financial activities performed in compliance with directions and with efficiency, as well as the internal audit report is reliable. Besides internal audit report shall be used as a tool in supporting the audit committee’s duties. AI Consultant (Thailand) Co., Ltd. is an expert in reviewing internal control system with the Certificated Internal Audit (CIA) expertise as well as experienced in setting internal control system for several organization, both private and state enterprise.

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Internal Information Control It is a policy of the Company that all directors and/or executive members are prohibited from using any material internal

information, which has not yet been disclosed to the public, for their own or any other person’s interest including for their or any other person’s trading of the Company’s securities. The Company informs executive members of the Company that any executive members, who receive or are aware of any of the Company’s material internal information and financial statements where such information may affect the price of the properties, should avoid or cease trading the Company’s securities for a period of 1 month and that they are prohibited from disclosing such material information to other persons prior to the disclosure of such material internal information and financial statements to the public. Penalty from using material internal information has been announced in employee manual. The Company also informs executive members of the Company’s departments or sections as to their duties to give report in respect of the Company’s securities held by them and their spouses and non-sui juris children, including the report of any changes thereof pursuant to (Section 59 and penalty provisions specified in Section 275 of) the Securities and Exchange Act B.E. 2535 (A.D. 1992) and regulations of the Stock Exchange of Thailand after the Company’s securities are listed.

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Internal Control According to the Company’s Board of Directors Meeting number 1 / 2009 held on February 24th, 2009, in which the

Company’s Audit Committee participated, an evaluation in respect of the Company’s internal control was made by the Board of Directors as follows; 1. Organization and Environment : The Company’s Management has set up an organization chart and responsibilities of Board of Directors as well as business goal for evaluation of management and employees. Moreover, the Company has also set up a code of conduct, three manuals for its procurement practices and the penalty for violation. 2. Risk Management : The Company has always been attentive to the internal and external risks which may have significant effects to the Company’s business. The Company always analyzes various risk related incidents and has procedures for implementation and monitors all risks management regularly. 3. Control over Management’s Practice : Scope of duties and responsibilities of each management level have been set up including procedure of connected transactions with major shareholders, directors, managements, and related persons. 4. Information Technology and Communication Systems : The Board of Directors has been provided with sufficient and accurate information to be considered in each meeting. The information regarding asset utilization between the Company and its subsidiaries has been made every month for asset management and account receivables management. With this information system, the Company shall be published accounting and financial information on time. 5. Follow – up System : Actual operational results have been reported to the Company’s Board of Directors by management on a quarterly year basis in order to compare with the Company’s target.

The Company has appointed IA Consultant (Thailand) Co., Ltd. to set up internal control system for the Company : furthermore, the Company’s auditor, ANS Audit CO., Ltd. has reviewed and evaluated accounting internal control system where necessary in order that scope of operations are identified concisely and appropriately. The auditor expressed his opinion that there is no substantial mistake is found in opening the financial statement .

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Dividend Policy

The Company has set up policy to pay dividend no less than 50 percent of net profit after tax and legal reserve of the Company; however, the dividend payment will be paid depend upon the Company’s financial results, financial condition and cash requirements, investment plan, and such other factors as the Company’s management consider appropriated.

The dividend policy for its subsidiaries will depend upon their financial results, investment plans, financial condition and cash requirements.

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Related Transaction Rules and procedures for approving connected transactions In case that the Company has a transaction with a related companies or related persons who may have conflicts of interest or

stakes or future conflicts of interest, the transaction shall be made on the appropriateness of fair market price by considering all the conditions in according with operations in the same type of industry and comparing with the external price or the market price. If the related transaction has been made under the normal business operation, the management is allowed to approve the transaction but have to quarterly reviewed by the Audit Committee for consideration of the fairness and reasonableness of such transactions.

If the related transaction has not been made under the normal business operation, the Audit Committee has to approve the transaction prior to the transaction taking place. If the Audit Committee is not specialized on the related transaction, the Company will provide an independent specialist or the Company’s Auditor to make suggestions on the transaction for the decision making of the Board of Directors, the Audit Committee or the shareholders. Besides, the related transactions of the Company will comply with the obligations, announcements, orders or the requirements of the Stock Exchange of Thailand. Thus the executive who may have conflicts of interest or a vested interest or benefits from the transaction has no rights to vote on that related transaction.

Policy or the Tendency of Future Related Transactions In the future related transactions, which is regular transaction, the Company has set up criteria and direction in compliance

with the general commerce by referring to reasonable price and appropriate conditions which can be audited and be presented to the Audit Committee to consider approval the criteria and directions. The Audit Committee shall opine in necessity and reasonableness of such transaction including all conditions. If the Audit Committee is not specialized on the related transaction, the Company will provide an independent specialist to make suggestions on the transaction for the decision making of the Audit Committee, and passed to the Board of Directors or the shareholders for final approval.

The approval of the related transactions shall comply with the obligations, announcements, orders or the requirements of the Stock Exchange of Thailand and shall disclose in the Notes to Financial Statement or electronic devices of the Stock Exchange of Thailand.

In case of Ruka Co., Ltd., Crane Today Co., Ltd., and Ruka Machine Co., Ltd. were related companies, but are non-related companies at the present. However, if there are any transactions between the Companies and its subsidiaries and those companies, the transactions shall be treated as related transactions. The Company shall follow rules and procedures for approving connected transactions and disclose such transaction in Notes to Financial Statement.

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Related Transactions in the year 2008

unit : Million Baht Consolidated

Financial Statement

Related Companies / Related Persons

Relationship Transaction

2008

Necessity and Reasonableness

Mr. Amnart Sanyarat Eastern Director of TCR and TCL

Advance payment to Mr. Amnart Sanyarat (Eastern Director) - Beginning Balance - Increasing - Decreasing - Ending Balance

0.08 0.00 0.08 0.00

The advance payment is related to TCR operation process such as expenses at Brunei Project, i.e. house rental expenses, registration fee and etc. The Audit Committee has considered the transaction and opined that the transactions are conducted under normal business process.

Ms. Junjira Praerangsi

Managing Director of TCR

Advance payment to Ms. Junjira Praerangsi (Managing Director) - Beginning Balance - Increasing - Decreasing - Ending Balance

0.04 0.30 0.34 0.00

The advance payment is related to TCR operation process such as expenses for project in Vietnam, i.e. entertainment expenses, New Year gifts for clients, and etc. The Audit Committee has considered the transaction and opined that the transactions are conducted under normal business process.

Mr. Thongchai Praerangsi and Ms. Jiraluck Praerangsi

Directors / Major Shareholders

Mr. Thongchai and Ms. Jiraluck are directors of the Company and have lend the Company and its subsidiaries for short-term loan as working capital without interest charge

- Beginning Balance - Increasing - Decreasing - Ending Balance

10.85 00.13 10.98 00.00

Those funds have been lent for working capital without interest charge. The Audit Committee has considered the transaction and opined that the transaction is financial support for group of the Companies. The transaction is reasonable and benefits to the Company without interest charge.

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Financial Statement



2008


Land rental fee on Phaholyothin Road, Tambon Klong Nung, Amphur Klong Luang, Prathumthani Province, present office of TCH at Baht 50,000 per month pay to Mr. Thongchai Praerangsi

0.60 TCH has to pay the land rental fee for its present office on Phaholyothin Road, Tambon Klong Nung, Amphur Klong Luang, Pathumthani Province at Baht 50,000 per month to Mr. Thongchai Praerangsi. However, TCH has not really paid the rental fee to Mr. Thongchai since the land is under the lawsuit as per details on item 7 (Lawsuits). TCH has booked this rental fee as accrued expenses with related person. The Audit Committee has considered the transaction and opined that the transaction is reasonable since rental feeTCH paid to its director is lower than market price of the same area. UK Valuation and Agency Co., Ltd. the independent appraiser, has appraised the land rental fee rate during February 8th, 2007 to December 31st, 2010 on February 8th, 2007 at Baht 120,000-145,000 per month.

Mr. Thongchai Praerangsi

Director / Major Shareholder

Expenses of land rental fee for TCH office to Mr. Thongchai Praerangsi has booked as accrued expenses since the land is under lawsuit

4.15 Expenses for land rental fee for TCH office to Mr. Thongchai Praerangsi has booked as accrued expenses since the land is under lawsuit. So TCH has ceased the rental payment to Mr. Thongchai until the lawsuit is finalized. The Audit Committee has considered the transaction and opined that booking the rental expenses as accrued expenses until the lawsuit is finalized is reasonable.

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Financial Statement



2008




Compensation of additional expenses on behalf of the company for any litigation cases from being sued involving the sale of heavy machinery which the Company and its subsidiaries acting as guarantor

- Beginning Balance - Increasing - Decreasing - Ending Balance

0.00 1.51 1.51 0.00

In 2007, the Company has a policy to book litigation cases from being sued according to Court’s consideration and lawyer’s opinion. If some litigation cases the Company and its subsidiaries are co-defendant, the accrued expenses will be booked pro rata. Since the legal cases are not finalized, Mr. Thongchai Praerangsi has sent his written intention to the Board of Directors to responsible for any additional expenses if the company and its subsidiaries lose more than accrued expenses. This intention from the director is to burden additional loss, to decrease any risk of the company, and to speed up the finalization of litigation cases. (Compromise). In 2008, there were 2 cases director had to pay additional sue on behalf of the Company and The Crane Services. The Company and its subsidiaries have no policy for any directors to responsible for the excess of litigation cases from being sued since 2008. The Audit Committee has considered the transaction and opined that booking accrued expenses of litigation cases from being sued according to Court’s consideration and lawyer’s opinion, and if some litigation cases the Company and its subsidiaries are co-defendant, the accrued expenses will be booked pro rata are sufficient operation and reasonable and have done for the benefits of company and investors.

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Financial Statement



2008




The Crane Services Co., Ltd. sold 2 plots of land area 79 square wah, land title deed no. 69652 and 69653 land no. 128 and 129 survey page 1516 and 1517 situated at Soi Muban Muangkaew, Bangna-Bangpakong (highway no. 34) Tambon Bangkaew, Amphur Bangplee (Prakanong), Samutprakarn which is the empty land and is not used for any business operation. The land is owned by TCS, and was sold to Mr. Thongchai Praerangsi at the price of Baht 2.20 Million. All transfer fee, taxes and other expenses paid by both parties at 50 percent each Trade Account Receivable

2.20

0.00

These plots of land were not for company business operation and were sold at the market price (according to independent appraiser, UK Valuation and Agency Co., Ltd., appraised on February 19th , 2008) at Baht 2.20 Million with profit for TCS at Baht 0.12 Million. The Audit Committee has considered the transaction and opined that the selling price at Baht 2.20 Million of the connected transaction is reasonable and appropriated because the appraisal value has been appraised by independent appraiser, UK Valuations and Agency Co., Ltd., on February 19th, 2008. Moreover, the land is not used for any business operation. It was therefore unanimously resolved to sell out the lands.

Substitute Chairman of the Board of Directors and Chief Executive Officer

38

Report of Board of Directors’ Responsibilities The Company’s Board of Directors recognize the significance of duties and responsibilities to manage the business of the Company in compliance with the law, the Company’s objectives, the Articles of Association as well as the resolution of the shareholders’ meeting with integrity and care for the best benefits of the company, all shareholders and investors by providing reasonable assurance that the financial statements recorded accuracy, adequate and present fairly financial position of the Company. The Board of Directors have appointed the Audit Committee which comprises of qualified independent directors in compliance with regulations of the Stock Exchange of Thailand and other Securities and Exchange Act to review and responsible for the accuracy, and adequate disclosure of the Company’s financial statement as well as the disclosure of related transactions and conflicts of interest. The Audit Committee has prepared a report on the committee’s monitoring activities and disclosed these to the Board of Directors.

The Board of Directors have opined that the financial statements for the year 2008 of Chu Kai Public Company Limited and subsidiaries being consolidated, in which the Audit Committee, the Company’s management and independent auditor have all reviewed, have been prepared in accordance with Generally Accepted Accounting Principle and present fairly financial position of the Company.

…………………………


39

Details of Executive and Authorized Directors of the Company Working Experiences Name-Surname

Position Age

(Years Education / Training

Shares Holding

(%) Relationship to other

executives Duration Positions and Places Mr. Somsak Sivapaiboon 46

Bachelor’s degree in General Management Sukhothai Thammathirat University IOD : DAP year 2006 DCP year 2007 Finance for Non-Finance Director year 2007

- - 2551 – Present

2549 - Present

2548 - Present

2547 - Present

2543 - Present

Assistant President (The President Office) Sahaviriya Steel Industries PCL. Deputy Chairman to the Board of Directors Chu Kai PCL Managing Director Line Transport Co., Ltd. Director and Executive Director Thai Cold Rolled Steel Sheet PCL Managing Director Prachuap Port Co., Ltd.

40

Working Experiences Name-Surname Position

Age (Years

Education / Training

Shares Holding (%)

Relationship to other executives Duration Positions and Places

Mr. Vacharin Doungdara 49 Bachelor of Law, Thammasat University Barrister of Law, The institute of Legal Education EX-MBA, Kasetsart University IOD : DAP year 2004 DCP year 2006

- - Present

2547-2550

2542-2547

2538-2541

2525-2538

Senior Manager Legal and Business Compliance Bank of Ayudhya PCL Chairman of the Audit Committee and independent director Chu Kai PCL Legal advisor, Lawyer, independent director and audit committee to many listed companies Debt Management Company under Kiatnakin Securities Group of Companies M Thai Co., Ltd., a debt management company for financing companies Thanachart and Ekachart Financing Institutes

41


Age (Years


Shares Holding (%)


Mr. Jessada Promjart 47 Master’s degree (Accounting) Thammasat University Bachelor’s degree (Accounting) Thammasat University IOD : DCP year 2004 CSP year 2004

- - 2551-Present

2547-Feb 2551

2546-2547

2549-Feb 2551

2549-Feb 2551

2549-Feb 2551

2543-2550

2542-2543

Audit Committee and Independent Director Chu Kai PCL Director D Land Development Co., Ltd. Director and Secretary to the Board of Directors Media and Medias PCL Director and Audit Committee Media and Medias PCL Director M and D Entertainment Co., Ltd. Director Media Studio Co., Ltd. Director MOM International Co., Ltd. Manager to Office of Chairman Bangkok Broadcasting and Television Co., Ltd. General Manager Chu Kai Co., Ltd.

42


Age (Years


Shares Holding (%)


Mrs. Werawan Boonkwan 39 Master’s degree (Finance & International Business), University of Wisconsin, USA. Bachelor’s degree (Accounting) Chulalongkorn University IOD : DAP year 2006 DCP year 2008

- - 2550-Present

2549-Present

2545-2550

2543-2545

2542-2543

Managing Director Korawit Learning Consultant, BCG. Director and Audit Committee Chu Kai PCL CFO Business Consultant & Advisory Co., Ltd. General Manager A Thai Market Co., Ltd. Analyst-Asset Management Bangkok Capital Aluance Co., Ld.

Mr. Thongchai Praerangsi 56 Certificate, Nida Business School IOD : DAP year 2006

42.22 Ms. Jiraluck, Ms. Jiraporn and Ms. Junjira Praerangsi’ s

father

2548-Present

2549-Present

2539-Present

2537-Present

2535-Present

Chief Executive Officer and Director Chu Kai PCL Director The Crane Services Co., Ltd. Director The Crane Heavy Lift Co., Ltd. Director The Crane Rayong Co., Ltd. Director The Crane Laem Chabang Co., Ltd.

43


Age (Years


Shares Holding (%)


Mr. Dhanis Haetanurak 59 Bachelor’s degree (Agricultural Economics) Kasetsart University

0.04 - 2544-Present

2544-19 Sep 2008

Chief Marketing Manager Chu Kai PCL Deputy Executive Chairman The Crane Heavy Lift Co., Ltd. The Crane Laem Chabang Co., Ltd. The Crane Rayong Co., Ltd. Director The Crane Heavy Lift Co., Ltd. The Crane Laem Chabang Co., Ltd. The Crane Rayong Co., Ltd.

Mr. Chamnan Ngampojanavong 48 Master’s degree (Management) Kasetsart University Bachelor’s degree (Capital Accounting) Chulalongkorn University IOD : DAP year 2008

- - 2551-Present

Oct 2551-Present

2536-2551

2533-2536

2528-2533

Chief Financial Officer and Director Chu Kai PCL Director The Crane Laem Chabang Co., Ltd. The Crane Rayong Co., Ltd. The Crane Heavy Lift Co., Ltd. Senior President Medium and Small Enterprises Bank Thai PCL Finance & Accounting Manager Pulthip Housing Co., Ltd. Primary Manager – Credit Management Department Siam Commercial Bank PCL

44


Age (Years


Shares Holding (%)


Ms. Nateeporn Doungsawasdi 48 Bachelor of Arts Ramkhamhaeng University IOD : DAP year 2005

4.44 - 2547-Present

2549-Present

Sep.2551-Present

1st May 2550-Aug. 2551

2539-April 2550

Executive Vice President and Director Chu Kai PCL Director The Crane Heavy Lift Co., Ltd. The Crane Laem Chabang Co., Ltd. The Crane Rayong Co., Ltd. Director The Crane Services Co., Ltd. Substitute Managing Director The Crane Heavy Lift Co., Ltd. Substitute Managing Director The Crane Services Co., Ltd. Managing Director The Crane Heavy Lift Co., Ltd.

Ms. Wanida Darachai 41 Bachelor of Arts Ramkhamhaeng University IOD : DAP year 2005 DCP year 2008 CSP year 2005

4.44 - 2547-Present

2549-Present

2544-Present

Executive Vice President and Director Chu Kai PCL Director The Crane Services Co., Ltd. Director The Crane Laem Chabang Co., Ltd. The Crane Heavy Lift Co., Ltd. The Crane Rayong Co., Ltd.

45


Age (Years


Shares Holding (%)


Ms. Jiraluck Praerangsi 31 Bachelor’s degree, Huachiew Chalermprakiet University MBA, Burapha University IOD : DAP year 2005 DCP year 2008

4.44 Mr. Thongchai Praerangsi’s daughter

2547-Present

2549-Present

2545-2547

Executive Vice President and Director Chu Kai PCL Director The Crane Services Co., Ltd. The Crane Heavy Lift Co., Ltd. The Crane Laem Chabang Co., Ltd. The Crane Rayong Co., Ltd. Substitute Managing Director The Crane Laem Chabang Co., Ltd.

Mrs. Pattanintorn Hlowchitsiang 50 Bachelor’s degree (Marketing) Thammasat University IOD: DAP year 2006

- - 2549-Present

Sep.2551-Present 2548-April 2550

Executive Vice President and Director Chu Kai PCL Substitute Managing Director The Crane Services Co., Ltd. Managing Director The Crane Services Co., Ltd.

Mrs. Chittra Thongsamut 45 Bachelor’s degree (Accounting) Ramkhamhaeng University

0.0002 - 2547-Present

2543-2547

2541-2542

2539-2541

Senior Finance Manager Chu Kai PCL Accounting Manager Fedura Co., Ltd. Accounting Manager TNT Express Worldwide (Thailand) Co., Ltd. Accounting Manager Car Image Co., Ltd.

46


Age (Years


Shares Holding (%)


Ms. Kuneeon Klakarnkai 38 Bachelor’s degree (Accounting) Krirk University Bachelor’s degree (Finance and Banking) Ramkhamhaeng University

0.0002 - 2548-Present

2546-2547

2545-2546

2545-2543

Accounting Manager Chu Kai PCL Assistant Finance & Accounting Manager Vuteq Asia Co., Ltd. (Chubu Group of Japan) Supervisor to Finance & Accounting Department Extra Beverage Industries Co., Ltd. Supervisor to Finance & Accounting Department Central Watson Co., Ltd.

Remarks: All the Company’s Board of Directors has qualifications in compliance with the requirements of the Securities and Exchange Commission under the Securities and Exchange Act.

47

Director / Executives

Company Mr. Somsak Sivapaiboon

Mr. Vacharin

Doungdara

Mr. Jessada Promjart

Mrs. Werawan Boonkwan

Mr.Thongchai Praerangsi

Mr. Dhanis Haetanurak

Mr. Chamnan Ngampojanavong

Ms. Nateeporn

Doungsawasdi

Ms. Wanida

Darachai

Ms. Jiraluck

Praerangsi

Mrs. Pattanintorn

Hlowchitsiang

Mrs. Chittra Thongsamut

Ms. Kuneeon

Klakarnkai

1. Chu Kai PCL 2, 3 3, 7 3, 8 3, 8 3, 4 , 9 10 3, 6, 10 3, 6, 10 3, 6, 10 3, 6, 10 3, 6,10 10 10

2. The Crane Services Co., Ltd. 3 3 3 3 3, 9

3. The Crane Laem Chabang Co., Ltd. 3 5 3 3 3 3

4. The Crane Rayong Co., Ltd. 3 5 3 3 3 3

5. The Crane Heavy Lift Co., Ltd. 3 5 3 3, 9 3 3

6. Line Transport Co., Ltd. 9

7. Thai Cold Rolled Steel Sheet PCL 3,6

8. Prachuap Port Co., Ltd. 9

9. Sahaviriya Steel Industries PCL 10

10. Meesuk Property Co., Ltd. 3 3 3

11. D Land Development Co., Ltd. 3

12. Recovery Management Co., Ltd. 3

13. Rajprasong Advisory Co., Ltd. 3

14. Urwittaya Co., Ltd. 8

15. Korawit Learning Consultant, BCG. 9 Remark : 1 Chairman 6 Executive Director 2 Deputy Chairman 7 Chairman of the Audit Committee and Independent Director 3 Director 8 Audit Committee and Independent Director 4 Executive Chairman 9 Managing Director 5 Executive Deputy Chairman 10 Executive

48

Details of Executive and Authorized Management of the Company and subsidiaries

Name-Surname Chu Kai Public Company

Limited The Crane Services Company Limited

The Crane Laem Chabang Company Limited

The Crane Rayong Company Limited

The Crane Heavy Lift Company Limited

Mr. Somsak Sivapaiboon 2, 3

Mr. Thongchai Praerangsi 1,3, 4, 8 3 3 3 3

Mr. Dhanis Haetanurak 9

Mr. Chamnan Ngampojanavong 3, 5, 9 3 3 3

Ms. Nateeporn Doungsawasdi 3, 5, 9 3 3 3 3, 8

Ms. Wanida Darachai 3, 5, 9 3 3 3 3

Ms. Jiraluck Praerangsi 3, 5, 9 3 3 3 3

Mrs. Pattanintorn Hlowchitsiang 3, 5, 9 3,8

Mr. Vacharin Doungdara 3, 6

Mr. Jessada Promjart 3, 7

Mrs. Werawan Boonkwan 3, 7

Mrs. Chittra Thongsamut 9

Ms. Kuneeon Klakarnkai 9

Ms. Viyada Pradubyard 9

Ms. Patcharin Poungrat 9

Mrs. Niramon Sutisiri 9

Ms. Pattaraporn Saengritdej 9

Ms. Jiraporn Praerangsi 3, 8,9

Mr. Siri Janewarin 9

49

Name-Surname Chu Kai Public Company

Limited The Crane Services Company Limited

The Crane Laem Chabang Company Limited

The Crane Rayong Company Limited

The Crane Heavy Lift Company Limited

Ms. Suwannee Sanguandee 9

Mr. Kravee Boonma 9

Mrs. Daoruang Yimsawasdi 9

Ms. Doungchan Kanchanavorawong 9

Ms. Pannee Nojakun 9

Ms. Junjira Praerangsi 3,8,9

Mr. Suraphon Jitdee 3,9

Ms. Wilai Nakwila 9

หมายเหตุ : 1 Substitute Chairman 2 Deputy Chairman 3 Director 4 Executive Chairman 5 Executive Director 6 Chairman of the Audit Committee and Independent Director 7 Audit Committee and Independent Director 8 Managing Director 9 Executive

50

Financial Status and Operating Results Analysis

With reference to the company have restructured the business operation within the group by purchasing shares of TCL, TCR and TCH in 2004 and TCS in 2006 of which according to the Consolidated Financial Statements of the company for 2005 to 2006 were audited by the certified public accountant of the company, it had shown the status and operating result of the company according to the principles of Consolidated Financial Statements whereby the operating result according to such Consolidated Financial Statements had included operating result of all subsidiaries commencing from the dated they were purchased by the company until present. For benefit in comparison the financial status and operating result under the common control of the group of companies in previous year, the company therefore prepared Consolidated Financial Statements as if they were newly prepared and audited by the certified public accountant for 2006 by including the financial status and operating result of all companies together since 2004. Therefore the financial status and operating result analysis is therefore considered as analysis from newly statements in principles. Statements of Income The operation of the company in 2008, the company earned total income Baht 789.56 million which was increased from the same period in last year 9.46 percent, classified into income from sale Baht 316.36 million and income from rental and transportation services Baht 473.19 million respectively due to the company had sold our products to abroad and been awarded large project, i.e. closing of factory for annual maintenance of petrochemical factories, power plant and petrochemical plants in Maptaphut Industrial Estate, installation of machine off shore in the Gulf of Thailand and etc. For initial profit derived from sale and service, in 2008, the company earned initial profit Baht 256.03 million which was 12.60 percent decreased from the same period in 2007 due to increasing of selling cost because the company’s products were separated for partial sale and for rental and transportation services whereby the latter was subjected to the depreciation calculation at 6.67 -20 percent per year. Should, in any year, the company sold the products for rental and transportation services after deduction of depreciation for several years but the market price was not decreased, the selling cost at such selling period was therefore increased-decreased according to the book price of inventory of which in 2008 had been deducted depreciation for 2 years. Such had caused the selling cost in 2008 was 90.32 percent increased from the same period in 2007 while net profit was decreased from Baht 78.82 million in 2007 to Baht 31.55 million in 2008 as caused by increasing of selling cost, increasing of depreciation of additionally purchased machine in substitution of the old machines which had been sold, and, loss from currency exchange in importing of machine from abroad at the end of 2008. Balance Sheets

Assets Total assets of the company have been continuously increased in 2008 total Baht 1,925.59 million, Baht 1,651.59 million in 2007 and Baht 1,591.65 million in 2006 as equaled to 16.59 percent and 3.77 percent increased respectively upon comparing with the same period of last year which was the increase of current assets Baht 46.75 million or 17.01 percent upon comparing with the same period of last year which was increased from Baht 274.88 million in 2007 to Baht 321.63 million in 2008, and the

51

increase of non-current asset Baht 227.25 million or 16.51 percent upon comparing with the same period of last year which was increased from Baht 1,376.71 million in 2007 to Baht 1,603.96 million in 2008. For the increase of non-current asset in 2008 was incurred from purchasing 2 units of 280 ton crawler crane of Hitachi Sumitomo, SCX2800-2 model in February total approx. Baht 172.65 million and import of used machine capacity 50 ton and 25 ton in the fourth quarter total 12 units. Liabilities Total liabilities was increased from Baht 972.91 million in 2006 and Baht 954.02 million in 2007 to Baht 981.92 million in 2008 or 2.92 percent upon comparing with the same period of 2007 due to after the company had obtained additional capital after selling of ordinary share to the publics, the company had paid loan back to one bank according to the agreement total Baht 100 million in February 2008, and in July 2008, the company had obtained additional loan from one bank total approx. Baht 224.50 million which was consisted of L/C, T/R, P/N and FXF (PSR) for fluency of business operation and enhance the effectiveness in expansion of business related to the import of machine from abroad for granting lease and used as current capital in business operation. In 2008, the company imported additional machine in substitution of the sold machine, such had increased current liabilities from Baht 479.28 million in 2006 and Baht 497.27 million in 2007 to Baht 671.34 million respectively and non-current liabilities in 2008 and 2007 was decreased from Baht 493.63 million in 2006 to Baht 456.73 million in 2007 and Baht 310.58 million in 2008 respectively. Shareholders’ equity The shareholders’ equity as at 31 December 2006 – 2007 and 2008 was Baht 618.75 million , Baht 697.57 million and Baht 934.67 million respectively. The shareholders’ equity in 2008 was increased from Baht 697.57 million to Baht 934.67 million or 33.99 percent. The increase of shareholders’ equity in addition to net profit in 2008 total Baht 31.55 million, in 2007 the company had increased the registered capital 100 million shares each of 1 Baht to support the registration as listed company in the Market for Alternative Investment (mai) and had been paid in February 2008 total Baht 100 million and the share value surplus was higher than registered capital total Baht 159.55 million. Financial ratio The ratio of liability toward shareholders’ equity in 2006-2007 and 2008 was 1.57 times, .37 times and 1.04 times respectively which was continuously decreased whereby in 2008 the company had the decreased ratio of liability toward shareholders’ equity as resulted from increasing registered capital in 2007 and been paid back in 2008 from Baht 350.00 million to Baht 450.00 million and increasing share value surplus Baht 159.55 million including also increasing retained profit from net profit in 2008 total Baht 31.55 million. Even the company had obtained additional loan from financial institute but the increase of liability of company in 2008 was still lower than the increase of shareholders’ equity in the same period, it has decreased the ratio of liability toward shareholders’ equity in 2008 to only 1.04 times.

Auditor’s Report & Financial Report

Auditor’s Report

To the Shareholders of Chukai Public Company Limited:

I have audited the consolidated balance sheets of Chukai Public Company Limited and subsidiaries as at December 31, 2008 and 2007, and the related consolidated statements of income, changes in shareholders’ equity and cash flows for each of the years then ended, and I have also audited the separate balance sheets of Chukai Public Company Limited as at December 31, 2008 and 2007, and the related separate statements of income, change in shareholders’ equity and cash flows for each of the years then ended. The Company’s management is responsible for the correctness and completeness of information presented in these financial statements. 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 audits to obtain a reasonable assurance as to whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. I believe 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 consolidated financial positions of Chukai Public Company Limited and its subsidiaries as at December 31, 2008 and 2007, and the consolidated results of their operations and their cash flows for each of the years then ended, and the separate financial positions of Chukai Public Company Limited as at December 31, 2008 and 2007, the results of its operations and its cash flows for each of the years then ended, in conformity with generally accepted accounting principles.

Prawit Viwanthananut Certified Public Accountant Registration Number 4917

ANS Audit Co., Ltd. Bangkok,February6,2009

52

53

(Unit: Baht)

Notes 2008 2007 2008 2007

3

Current Assets

Cash and cash equivalents 6 31,663,846.31 14,659,743.72 1,009,833.85 880,189.64

Current investments 18,343.54 119,028.34 - -

Trade accounts receivable - net 5, 7 142,987,359.94 75,597,294.51 82,655,057.79 39,809,411.80

Accounts receivable from sale of assets 5 - 9,000,000.00 - -

Receivable under repurchase agreement - net 12 - - - -

Accrued income - net 5, 8 5,287,210.27 21,292,668.50 1,972.60 -

Short-term loans to related parties 5 - - 1,600,000.00 -

Inventories - net 9 100,586,872.00 122,236,151.42 103,567,099.59 124,007,524.07

Other current assets - net 10 41,085,069.88 31,974,623.27 25,493,405.48 20,099,375.39

Total Current Assets 321,628,701.94 274,879,509.76 214,327,369.31 184,796,500.90

Non-Current Assets

Restricted bank deposits 13 6,278,701.60 6,061,393.86 3,750,750.88 -

Investments in subsidiaries 2, 5, 11 - - 174,991,430.00 174,991,430.00

Property, plant and equipment - net 15 1,560,450,476.31 1,346,150,036.07 1,050,384,091.91 873,954,555.25

Non-operating assets 5, 16 - 2,066,960.00 - -

Account receivable from installment sales 14 808,174.66 1,218,383.28 808,174.66 1,218,383.28

Other non-current assets - net 18 36,425,166.98 21,210,981.27 20,179,915.87 8,395,344.21

Total Non-Current Assets 1,603,962,519.55 1,376,707,754.48 1,250,114,363.32 1,058,559,712.74

TOTAL ASSETS 1,925,591,221.49 1,651,587,264.24 1,464,441,732.63 1,243,356,213.64

financial statements financial statements

ASSETS

CHUKAI PUBLIC COMPANY LIMITED AND SUBSIDIARIES

BALANCE SHEETS

AS AT DECEMBER 31, 2008 AND 2007

Consolidated Separate

54

(Unit: Baht)

Notes 2008 2007 2008 2007

3

Current Liabilities

Bank overdrafts and short-term loans from financial institutions 19 129,701,706.93 104,649,275.63 116,708,214.55 102,331,264.70

Trade accounts payable 5,20 203,633,464.28 25,279,040.60 280,578,515.32 94,111,970.59

Accounts payable from purchasing assets 2,247,000.00 - - -

Current portion of long-term debts 23 221,016,245.15 230,233,176.40 135,616,165.94 147,212,642.27

Liabilities under repurchase agreement 24, 39 60,110,913.64 60,110,913.64 - -

Short-term loans from related parties 5 - 10,853,636.42 32,300,000.00 36,002,422.31

Other short-term loans 21 - 8,952,657.53 - -

Advances received for goods and service 1,869,158.88 2,336,448.60 1,869,158.88 2,336,448.60

Accrued expenses 5 34,470,976.17 34,144,705.96 4,083,007.44 13,682,985.27

Accrued income tax 59,254.53 1,163,448.53 - -

Other current liabilities 22 18,231,727.37 19,547,774.04 3,161,933.07 7,719,394.19

Total Current Liabilities 671,340,446.95 497,271,077.35 574,316,995.20 403,397,127.93

Non-Current Liabilities

Long-term debts 23 300,562,251.83 444,342,551.75 132,801,213.27 333,039,038.17

Other non-current liabilities 5,25 10,013,560.52 12,405,564.36 314,626.00 392,231.50

Total Non-Current Liabilities 310,575,812.35 456,748,116.11 133,115,839.27 333,431,269.67

Total Liabilities 981,916,259.30 954,019,193.46 707,432,834.47 736,828,397.60


BALANCE SHEETS




LIABILITIES AND SHAREHOLDERS' EQUITY

55

(Unit: Baht)

Notes 2008 2007 2008 2007

3

SHAREHOLDERS' EQUITY

Share capital 26

Authorized share capital - 450,000,000 common shares Baht 1 par value 450,000,000.00 450,000,000.00 450,000,000.00 450,000,000.00

Issued and paid-up share capital - 450,000,000 common shares in year 2008

and 350,000,000 common shares in year 2007, Baht 1 par value 450,000,000.00 350,000,000.00 450,000,000.00 350,000,000.00

Premium on share capital 27 209,553,500.00 50,000,000.00 209,553,500.00 50,000,000.00

Surplus from internal restructure of entities under common control 2 39,195,609.23 39,195,609.23 - -

Retained earnings

Appropriated to legal reserve 28 8,427,490.49 6,631,111.38 8,427,490.49 6,631,111.38

Unappropriated 236,498,362.47 251,741,350.17 89,027,907.67 99,896,704.66

Total Shareholders' Equity 943,674,962.19 697,568,070.78 757,008,898.16 506,527,816.04

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 1,925,591,221.49 1,651,587,264.24 1,464,441,732.63 1,243,356,213.64


BALANCE SHEETS




LIABILITIES AND SHAREHOLDERS' EQUITY

56

from rental and transportation services 473,190,836.95 467,454,414.59 128,487,125.77 11

l revenue from sales and services 789,555,102.66 721,314,355.09 575,807,185.12 40

les and services 5

les (170,191,381.92) (89,423,701.31) (351,383,442.19) (23

l and transportation services (363,337,346.42) (338,963,904.44) (94,323,585.81) (7

l cost of sales and services (533,528,728.34) (428,387,605.75) (445,707,028.00) (30

fit 256,026,374.32 292,926,749.34 130,100,157.12 10

ome 5,30 26,701,641.09 20,287,846.87 20,690,840.82 2

nd income from subsidiary 5,29 - - 20,998,530.00

d administrative expenses 5,31 (159,244,363.83) (142,411,717.03) (93,073,757.61) (6

osts 5,32 (74,793,927.63) (74,387,096.03) (42,788,188.21) (4

fore income tax 48,689,723.95 96,415,783.15 35,927,582.12

x 33 (17,136,332.54) (17,594,284.70) -

IT 31,553,391.41 78,821,498.45 35,927,582.12

attributable to:

lders of the parent 31,553,391.41 78,821,498.45 35,927,582.12

y interests of the susidiaries - - -

31,553,391.41 78,821,498.45 35,927,582.12

rnings Per Share

Net profit attributable to equity holders of the parent 3 0.07 0.23 0.08

Numbers of Weighted Average Common Shares (Shares) 3 439,890,710 350,000,000 439,890,710

(Unit: Baht)

Notes 2008 2007 2008 2007

3

Revenue from sales and services 5

Revenue from sales 316,364,265.71 253,859,940.50 447,320,059.35 297,549,908.04

Revenue 1,397,872.77

Tota 8,947,780.81

Cost of sa

Cost of sa 1,649,239.38)

Cost of renta 2,641,928.63)

Tota 4,291,168.01)

Gross pro 4,656,612.80

Other inc 1,258,071.66

Divide -

Selling an 7,791,607.83)

Finance c 8,858,034.68)

Profit be 9,265,041.95

Income ta -

NET PROF 9,265,041.95

Net profit

Equity ho 9,265,041.95

Minorit -

9,265,041.95

Basic Ea

0.03

350,000,000



STATEMENTS OF INCOME

FOR EACH OF THE YEARS ENDED DECEMBER 31, 2008 AND 2007


57

(Unit: Baht)

Issued and paid-up Premium on Surplus from internal restructure

Notes share capital share capital of entities under common control Appropriated Unappropriated Total

Beginning balance as at January 1, 2007 350,000,000.00 50,000,000.00 39,195,609.23 6,167,859.29 173,383,103.81 618,746,572.33

Net profit - - - - 78,821,498.45 78,821,498.45

Legal reserve - - - 463,252.09 (463,252.09) -

Ending balance as at December 31, 2007 350,000,000.00 50,000,000.00 39,195,609.23 6,631,111.38 251,741,350.17 697,568,070.78

Net profit - - - - 31,553,391.41 31,553,391.41

Legal reserve 28 - - - 1,796,379.11 (1,796,379.11) -

Dividend payment 29 - - - - (45,000,000.00) (45,000,000.00)

Common shares 26 100,000,000.00 159,553,500.00 - - - 259,553,500.00 Ending balance as at December 31, 2008 450,000,000.00 209,553,500.00 39,195,609.23 8,427,490.49 236,498,362.47 943,674,962.19

Retained earnings


STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY


Consolidated financial statements

58

09

95

-

04

12

-

00)

00

16

(Unit: Baht)

Issued and paid-up Premium on

Notes share capital share capital Appropriated Unappropriated Total

Beginning balance as at January 1, 2007 350,000,000.00 50,000,000.00 6,167,859.29 91,094,914.80 497,262,774.

Net profit - - - 9,265,041.95 9,265,041.

Legal reserve - - 463,252.09 (463,252.09)

Ending balance as at December 31, 2007 350,000,000.00 50,000,000.00 6,631,111.38 99,896,704.66 506,527,816.

Net profit - - - 35,927,582.12 35,927,582.

Legal reserve 28 - - 1,796,379.11 (1,796,379.11)

Dividend payment 29 - - - (45,000,000.00) (45,000,000.

Common shares 26 100,000,000.00 159,553,500.00 - - 259,553,500.

Ending balance as at December 31, 2008 450,000,000.00 209,553,500.00 8,427,490.49 89,027,907.67 757,008,898.

Retained earnings


STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY


Separate financial statements

59

(Unit: Baht)

2008 2007 2008 2007

Cash Flows from Operating Activities

Net profit 31,553,391.41 78,821,498.45 35,927,582.12 9,265,041.95

Adjustments to reconcile net profit to net cash provided by operating activities

Depreciation and amortization 246,400,932.20 217,945,187.90 79,043,419.68 58,259,414.58

Interest income (323,485.00) (609,757.91) (209,329.85) (258,230.84)

Interest expense 73,967,509.13 74,136,866.03 42,188,188.21 48,658,034.68

Bad debt and doubtful accounts 3,675,360.74 16,921,013.84 - -

Bad debt recovery (13,111,560.90) (2,195,942.66) - (774,797.81)

Loss from obsolete stock 2,652,589.23 11,986,789.09 2,652,589.23 11,986,789.09

Loss from impairment of assets and loss from written-off assets 1,928,000.60 1,000,000.00 - -

Gain on sales of assets (1,824,963.98) (8,182,319.58) (155,443.40) (489,683.96)

Estimated liabilities 131,785.60 - - -

Unrealized (gain) loss on exchange rate 20,138,843.76 (92,977.65) 20,138,843.76 (92,977.65)

Dividend income from subsidiary - - (20,998,530.00) -

Income tax 17,136,332.54 17,594,284.70 - -

Profit from operating activities before change in

operating assets and liabilities 382,324,735.33 407,324,642.21 158,587,319.75 126,553,590.04

Change in operating assets (increase) decrease

Trade accounts receivable (70,336,385.91) 21,896,833.38 (42,845,645.99) 21,816,929.64

Accrued income 15,655,458.23 14,200,628.93 - 2,755,084.24

Inventories 86,228,171.98 (10,863,597.71) 18,676,039.17 (6,809,084.19)

Other current assets (9,081,346.77) 5,225,516.10 (5,394,030.08) (4,958,981.19)

Accounts receivable from installment sales 410,208.62 2,485,424.42 410,208.62 2,485,424.42

Other non-current assets (4,393,609.04) (3,369,728.60) (6,612,916.43) (156,655.42)


STATEMENTS OF CASH FLOWS




60

(Unit: Baht)

2008 2007 2008 2007

Change in operating liabilities increase (decrease)

Trade accounts payable 167,322,808.82 (16,123,342.61) 175,434,929.87 49,249,201.92

Advances received for goods and service (467,289.72) - (467,289.72) (600,648.60)

Accrued expenses (2,950,962.22) (3,351,508.72) (8,721,019.41) 646,487.34

Other current liabilities (1,316,056.67) (2,236,425.52) (4,557,471.12) (1,873,539.74)

Other non-current liabilities (2,392,003.84) 570,620.43 (77,605.51) (133,781.36)

Cash receipt from tax return 5,400,721.46 - - -

Income tax paid (30,775,304.03) (53,226,945.14) (5,171,655.23) (10,636,947.60)

Net cash provided by operating activities 535,629,146.24 362,532,117.17 279,260,863.92 178,337,079.50

Cash Flows from Investing Activities

Interest received 323,485.00 609,902.96 207,357.25 275,126.18

Dividend received from subsidiary - - 20,998,530.00 -

Decrease (increase) in current investment 100,684.80 (3,242.75) - -

Decrease (increase) in short-term loans to related parties - - (1,600,000.00) 19,295,894.86

Decrease (increase) in restricted bank deposits (217,307.74) 625,305.94 (3,750,750.88) -

Purchase of fixed assets (276,833,444.71) (61,236,956.61) (199,177,056.77) (48,691,547.54)

Decrease in account payable from purchasing assets - (14,300,000.00) - (14,300,000.00)

Cash receipt from sales of assets 15,293,608.33 5,590,654.32 1,277,794.71 634,291.84

Net cash used in investing activities (261,332,974.32) (68,714,336.14) (182,044,125.69) (42,786,234.66)

Cash Flows from Financing Activities

Increase in bank overdrafts and short-term loans

from financial institutions 15,945,202.40 11,435,048.75 5,269,720.95 9,987,862.80

Cash receipt from short-term loans from related parties 127,544.00 27,423,400.00 53,000,000.00 76,855,972.34

Repayment of short-term loans from related parties (10,981,180.42) (24,593,400.00) (56,702,422.31) (49,434,186.45)

Decrease in other short-term loans - 8,870,284.82 - -

Cash receipt from sales and leaseback agreement 6,405,000.00 6,752,463.44 - 6,752,463.44

Repayment of liabilities under financial lease (259,098,296.29) (191,992,587.03) (116,140,756.03) (79,889,346.02)



STATEMENTS OF CASH FLOWS (CONTINUED)



61

(Unit: Baht)

2008 2007 2008 2007

Cash receipt from long-term loans from financial institutions 20,000,000.00 - - -

Repayment of long-term loans from financial institutions (169,600,072.62) (55,902,085.77) (154,000,000.00) (54,683,017.61)

Repayment of liabilities under debt restructuring agreements (3,821,714.10) (1,246,174.01) - -

Cash receipt from increase in share capital 259,553,500.00 - 259,553,500.00 -

Interest paid (70,822,062.30) (70,782,970.81) (43,067,146.63) (48,138,630)

Dividend payment (44,999,990.00) - (44,999,990.00) -

Net cash used in financing activities (257,292,069.33) (290,036,020.61) (97,087,094.02) (138,548,881.28)

Net increase (decrease) in cash and cash equivalents 17,004,102.59 3,781,760.42 129,644.21 (2,998,036.44)

Cash and cash equivalents at the beginning of the years 14,659,743.72 10,877,983.30 880,189.64 3,878,226.08

Cash and cash equivalents at the end of the years 31,663,846.31 14,659,743.72 1,009,833.85 880,189.64

Additional details of non-cash items

During the year 2008

1. The Company and subsidiaries had purchased the machines and equipment for rent and the vehicles at cost in the amount of Baht 245.55 million

(year 2007: Baht 255.65 million) by cash payment in the amount of Baht 51.60 million (year 2007: Baht 19.95 million) and by entering into a financial

lease agreement for the remainder.

2. The Company and subsidiaries had transferred thier machines and equipment for rent to inventories at book value in the amount of Baht 0.89 million

(year 2007: Baht 36.66 million) in separate financial statement and in the amount of Baht 109.07 million (year 2007: Baht 69.81 million) in consolidated

financial statement.



STATEMENTS OF CASH FLOWS (CONTINUED)



62

CCHUKAI PUBLIC COMPANY LIMITED AND SUBSIDIARIES

NOTES TO FINANCIAL STATEMENTS


1. GENERAL INFORMATION

Chukai Public Company Limited, “the Company” is incorporated in Thailand under the Civil and Commercial Code on May 26, 1997 and became a public company limited on June 8, 2005. The Company’s principal activities are to trade, repair and provide maintenance services, rental services and transportation services for cranes, forklifts, tractors and trucks.

On January 29, 2008, the Company was listed on the Stock Exchange of Thailand.

The office of the Company and the factory are at 42/62, Moo 14, Bangkaew, Bangplee, Samutprakarn.

2. BASIS OF PREPARATION OF THE FINANCIAL STATEMENTS

The accompanying financial statements are prepared in accordance with Thai Accounting Standards (“TAS”) including related interpretations and guidelines promulgated by the Federation of Accounting Professions (“FAP”) in conformity with generally accepted accounting principles in Thailand.

The accompanying financial statements of the Company have been prepared in the Thai language and expressed in Thai Baht. Such financial statements have been prepared for domestic reporting purposes. For the convenience of the readers not conversant with the Thai language, an English version of the financial statements has been provided by translating from the Thai version of the financial statements.

The preparation of the financial statements in conformity with Thai accounting standard requires management to make judgments, estimates and assumptions that affect the application of policies and reported amounts of assets, liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgments about carrying amounts of assets and liabilities that are not readily apparent from other sources. Subsequent actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised, if the revision affects only that period, and in the period of the revision and future periods, if the revision affects both current and future periods.

63

Adoption of new or revised Thai Accounting Standards (TAS)

In year 2008, the Federation of Accounting Professions (FAP) has issued Notifications on new or revised Accounting Standards as follows:-

a) Thai Accounting Standards which are effective for the current year;

Topic

25 (revised 2007) Cash Flows Statements

29 (revised 2007) Leases

31 (revised 2007) Inventories

33 (revised 2007) Borrowing Costs

35 (revised 2007) Presentation of Financial Statements

39 (revised 2007) Accounting Policies, Changes in Accounting Estimates and Errors

41 (revised 2007) Interim Financial Reporting

43 (revised 2007) Business Combinations

49 (revised 2007) Construction Contracts

51 Intangible Assets

TAS No.

b) Thai Accounting Standards that will be applied to the financial statements for the accounting period commencing on or

after January 1, 2009;

Topic

36 (revised 2007) Impairment of assets

54 (revised 2007) Non-current Assets Held for Sale and Discontinued Operations

TAS No.

The management has assessed that the adoption of these new and revised TAS does not have any material impact on the financial statements.

64

BASIS OF CONSOLIDATED FINANCIAL STATEMENT PRESENTATION

The consolidated financial statements for each of the years ended December 31, 2008 and 2007 consisted of the financial statements of Chukai Public Company Limited, and subsidiaries (together referred to as “the Group”) as follows:

Subsidiaries Located in Business Type 2008 2007

The Crane Lamechabang Co., Ltd. Thailand Sales and rental service for cranes 100% 100%

The Crane Rayong Co., Ltd. Thailand Sales and rental service for cranes 100% 100%

The Crane Heavy Lift Co., Ltd. Thailand Sales and rental service for cranes 100% 100%

The Crane Service Co., Ltd. Thailand Sales and rental service for cranes 100% 100%

Percentage of holding

The percentage of assets and revenues of the subsidiaries in relation to the total assets and total revenues as included in the consolidated financial statements for each of the years ended December 31, 2008 and 2007 were as follows:

Subsidiaries

2008 2007 2008 2007

The Crane Lamechabang Co., Ltd. 8.62 9.05 27.35 24.11

The Crane Rayong Co., Ltd. 21.54 18.69 39.28 33.85

The Crane Heavy Lift Co., Ltd. 5.16 6.84 12.58 20.83

The Crane Service Co., Ltd. 11.63 14.75 18.32 16.78

included in the consolidated balance sheet

Revenues as a percentage of the total

statements of earnings

Assets as a percentage of the total assets revenues included in the consolidated

All significant intercompany transactions and accounts are eliminated in preparing the consolidated financial statements.

The preparations of the interim consolidated financial statements have been based on the same accounting policies for the same or similar accounting transactions or accounting events.

Subsidiaries are an entity controlled by the Company. Control exists when the Company has the power, directly or indirectly through other subsidiaries, to govern the financial and operating policies of an entity so as to obtain benefits from its activities. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases.

The surplus from restructuring under the common control is the difference between the net book value of such acquired investment and cost of acquired investment from restructuring into the Company under common control. These said investments are from merging the entity which the directors and committees are the same directors and committees. The said surplus is presented in the Balance sheet under Shareholder’s equity.

65

3. SIGNIFICANT ACCOUNTING POLICIES

The Measurement Bases Used in Preparing the Financial Statements

Other than those disclosed elsewhere in the summary of significant accounting policies and other notes to the financial statements, the financial statements are prepared on the historical cost basis.

Revenues

Revenue excludes value added taxes or other sales taxes and is arrived at after deduction of trade discounts.

Revenue is recognized in the statement of income when the significant risks and rewards of ownership have been transferred to the buyer. No revenue is recognized if there is continuing management involvement with the goods or there are significant uncertainties regarding recovery of the consideration due, associated costs or the probable return of goods.

Revenues from services of rental and transportation are recognized when services are rendered.

Revenue from rental

Revenue from rental is recognized to the statement of income by the straight line method based on agreement.

Interest income

Interest income is recognized as interest accrues, based on the effective rate method.

Dividends income

Dividends incomes are recognized when the right to receive the dividends is established.

Other incomes

Other incomes are recognized on an accrual basis.

Expenses

Expenses are recognized on an accrual basis.

Operating leases

Payments made under operating leases are recognized in the statement of income on a straight line basis over the term of the lease. Lease incentives received are recognized in the statement of income as an integral part of the total lease payments made. Contingent rentals are charged to the statement of income in the accounting period in which they are incurred.

66

Finance costs

Interest expenses and similar costs are charged to the statement of income in the period in which they are incurred, except to the extent that they are capitalized as being directly attributable to the acquisition, construction or production of an asset which necessarily takes a substantial period of time to be prepared for its intended use or sale. The interest component of finance lease payments is recognized in the statement of income using the effective interest rate method.

Interest expenses

Interest expenses are recognized to the statement of income during the financial period in which they are incurred.

Employee benefits

The Company operates a provident fund that is a defined contribution plan. The assets of which are held in a separate trust fund. The provident fund is funded by payments from employees and the company. Contributions to the provident fund are charged to the statement of income in the year to which they relate.

Cash and cash equivalents

Cash and cash equivalents are cash on hand, current deposits and savings deposits, cash at bank with an original maturity of 3 months and short-term investments with high liquidity net of deposits at bank on obligation.

Current investments

Current investments are the fixed deposits with maturity not over 1 year.

Trade and other accounts receivable

Trade and other accounts receivable are stated at their invoice value less allowance for doubtful accounts.

Trade accounts receivable are stated at the net realizable value. The Group recorded allowance for doubtful accounts that is provided for the estimated losses that may be incurred in collection of receivables. The allowance is generally based on collection experiences and analysis of debtor aging.

Inventories

Finished goods are valued at the lower of the specific identification cost method or net realizable value.

Cost comprises all costs of purchase, costs of conversion and other costs incurred in bringing the inventories to their present location and condition. In the case of manufactured inventories, cost includes an appropriate share of overheads based on normal operating capacity.

Net realizable value is the estimated selling price in the ordinary course of business less the costs to make the sale.

67

A provision for devaluation of inventories is made for all deteriorated, damaged, obsolete and slow-moving inventories.

Investments in subsidiaries

Investments in subsidiaries in the separate financial statements of the Company are accounted for using the cost method less allowance for impairment loss (if any).

Property, Plant and Equipment

Property, plant and equipment are stated at cost less accumulated depreciation and allowance for impairment (if any).

Depreciation

Depreciation is computed by the straight–line method based on the estimated useful lives of assets as follows:

Years

Buildings 20

Machinery and equipment 5 - 10

Machinery and equipment for rent 5, 7, 10 and 15

Equipment and tools 5

Furniture and office equipment 5

Vehicles 5

Depreciation is included in determining income and no depreciation is provided on land, part of land improvement and construction in progress.

Repairs and maintenance are charged to the statement of income during the financial period in which they are incurred. The cost of major renovations is included in the carrying amount of the asset when it is probable that future economic benefits in excess of the originally assessed standard of performance of the existing asset will flow to the Group. Major renovations are depreciated over the remaining useful life of the related asset.

Gains and losses on disposals are determined by comparing the proceeds carrying amount and are included in operating profit.

The property and equipment for lease had an objective to lease and sell. Therefore, the property and equipment which did not sell by the assets go to rent were recorded in “Property, plant and equipment” and were depreciated with its useful life as above recorded in “Cost of rental and transportation services” until there are sales will stop the depreciation and will be reclassified to be “Finished Goods” if sold out and will recognized the cost of sales with the net book value (cost less accumulated depreciation) on the disposed date to the statement of income in the period in which they are incurred.

68

Finance lease

Leases of property, plant or equipment which substantially transfer all the risks and rewards of ownership are classified as finance leases. Finance leases are capitalized at the inception of the lease at the lower of the fair value of the leased property or the present value of the minimum lease payments. Each lease payment is allocated to the principal and to the finance costs so as to achieve a constant rate on the finance balance outstanding. The outstanding rental obligations, net of finance costs, are included in other long-term payables. The interest element of the finance cost is charged to the statement of income over the lease period. The property, plant or equipment acquired under finance leases is depreciated over the shorter of the useful life of the asset or the lease term.

Impairment of Assets

The carrying amounts of the Group’s assets are reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such indication exists, the asset’s recoverable amount is estimated.

An impairment loss is recognized whenever the carrying amount of an asset or its cash-generating unit exceeds its recoverable amount. The impairment loss is recognized in the statement of income unless it reverses a previous revaluation credited to equity, in which case it is charged to equity.

Calculation of recoverable amount

The recoverable amount is the greater of the assets’ net selling price and value in use. In assessing 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. For an asset that does not generate cash inflows largely independent of those from other assets, the recoverable amount is determined for the cash-generating unit to which the asset belongs.

Reversals of impairment

An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount.

An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, if no impairment loss had been recognized.

Foreign Currencies Accounts

Transactions in foreign currencies

Transactions in foreign currencies are converted at the foreign exchange rates ruling at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are converted to Thai Baht at the foreign exchange rates ruling at that date. Forward exchange contracts at the transaction date are converted to Thai Baht by using the contract rates.

69

Outstanding forward exchange contracts are marked to market by comparing contract rates to forward rates established by the contracting Bank with the same maturity. At each balance sheet date, the unrealized gains or losses on outstanding forward exchange contracts, calculated as describe above, are included within other receivables or other payables from forward exchange contracts in the balance sheet.

Gain or loss on conversion is included in the statements of income.

Income Tax

Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantially enacted at the balance sheet date, and any adjustment to tax payable in respect of previous years.

Dividends

Dividend and interim dividend payment are recorded in the consolidated and separate financial statements in the period in which they are approved by authorized persons.

Basic Earnings per Share

Basic earnings per share for each of the years ended December 31, 2008 and 2007 are determined by dividing net profits attributable to ordinary shareholders for each of the years by the weighted average number of ordinary shares during the years. The Company adjusted the number of ordinary shares in proportion to the change in the number of shares as a result of the increase in share capital as discussed in Note 26.

Basic earnings per share for each of the years ended December 31, 2008 and 2007 were calculated by par value, Baht 1, as follows:

2008 2007 2008 2007

Net profit for the periods (Baht) 31,553,391.41 78,821,498.45 35,927,582.12 9,265,041.95

Weighted average number of ordinary shares (Shares)

Issued ordinary shares at January 1 350,000,000 350,000,000 350,000,000 350,000,000

Effect of shares issued on February 7, 2008 89,890,710 - 89,890,710 -

Weighted average number of ordinary shares (Shares) 439,890,710 350,000,000 439,890,710 350,000,000

Basic Earnings per Share (Baht) 0.07 0.23 0.08 0.03



70

Provisions

A provision is recognized in the balance sheet when the Company has a present legal or constructive obligation as a result of a past event, and it is probable that an outflow of economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. If the effect is material, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability.

4. CHANGE IN ESTIMATED USEFUL LIVES OF ASSETS FOR RENT

In year 2008, the Company and subsidiaries had reviewed the estimated useful lives of new assets for rent (Cranes and Forklifts) because of the change in the assets capacity and efficiency. As a result the useful lives of such assets for rent that the Company and subsidiaries acquired since June 2008 should be revised from 5 years to 7 years for used assets for rent and from 10 years to 15 years for new assets for rent and determined residual value of assets for rent at the rate 10% of cost. The change in the estimated useful lives result the depreciation for the year ended December 31, 2008 decreased in the amount of Baht 5 million in the consolidated financial statements and Baht 1.67 million in the separate financial statements.

5. TRANSACTIONS WITH RELATED PARTIES

The Company had transactions with related parties. These parties were related through common shareholders and/or directorships. The significant transactions with related parties as included in the financial statements are determined at the prices in line occurring in the normal course of business based on the market price in general or the price as stipulated in the agreement if no market price exists.

The significant balances of assets, liabilities and other transactions occurred with those related parties were as follows:

Transaction with related parties for each of the years ended December 31, 2008 and 2007.

2008 2007 2008 2007

Subsidiaries

The Crane Lamechabang Co., Ltd.

Sales of goods - - 35,004,414.30 16,356,085.00

Revenues from rental and transportation services - - 43,246,236.94 21,394,333.24

Revenues from repairment - - 10,252,864.82 11,190,735.42

(Unit: Baht)



71

2008 2007 2008 2007

Revenues from rental building - - 1,148,400.00 1,148,400.00

Revenues from consulting - - 3,600,000.00 3,600,000.00

Other income - - 335,991.30 125,360.00

Interest income - - 30,061.65 21,538.45

Purchase of goods - - 44,862,628.40 23,490,000.00

Costs from rental and transportation services - - 604,575.95 229,632.90

The Crane Rayong Co., Ltd.

Sales of goods - - 79,372,863.00 388,519.25




Other income - - 210,481.32 45,000.00

Interest income - - 1,972.60 -


Costs from rental and transportation services - - 536,029.86 -

Services and administrative expenses - - 1,632.00 165,383.60

Interest expenses - - 79,715.06 102,759.25

The Crane Heavy Lift Co., Ltd.

Sales of goods - - 19,097,087.50 16,063,143.05




Other income - - 263,658.76 107,100.00


Costs from rental and transportation services - - 290,156.50 1,124,612.40

(Unit: Baht)



72

2008 2007 2008 2007

The Crane Service Co., Ltd.

Sales of assets - - - 1,350,000.00

Sales of goods - - 729,424.50 15,920,925.00




Revenues from rental building - - 600,000.00 600,000.00

Other income - - 1,356,885.71 949,658.70


Purchase of assets - - - 157,100.26

Costs from rental and transportation services - - 2,722,621.29 -

Services and administrative expenses - - 413,073.27 3,244,161.34

Other expenses - - - 1,492,426.32

Interest expenses - - 2,372,037.59 1,268,595.20

Other Related Companies

Ruka Co., Ltd.

Revenues from rental and transportation services - 1,742,798.39 - 1,621,000.00

Line Transport Co., Ltd.

Revenues from rental and transportation services - 1,942,944.39 - -

Related Persons (Shareholders and Directorship)

Sale of non-operating land 2,200,000.00 10,400,000.00 - -

Interest incomes - 131,235.09 - -

Rental expenses 600,000.00 600,000.00 - -

(Unit: Baht)



73

Balance with related parties as at December 31, 2008 and 2007.

2008 2007 2008 2007

Subsidiaries

The Crane Lamechabang Co., Ltd.

Trade accounts receivable - - 28,459,964.66 11,277,044.27

Trade accounts payable - - 16,805,434.08 497,551.37

Deposit - - 95,700.00 95,700.00

The Crane Rayong Co., Ltd.


Short-term loans receivable - - 1,600,000.00 -

Accrued interest income - - 1,972.60 -

Trade accounts payable - - 144,333.19 19,292,156.00

Accrued expenses - - - 104,222.85

Short-term loans payable - - - 6,398,735.89

Accrued interest expenses - - - 102,759.25

The Crane Heavy Lift Co., Ltd.


Trade accounts payable - - 16,237,238.00 16,509,822.77

The Crane Service Co., Ltd.


Trade accounts payable - - 59,253,678.12 45,427,744.49

Short-term loans payable - - 32,300,000.00 21,600,000.00

Accrued interest expenses - - 16,371.24 421,800.27

Related Persons (Shareholders and Directorship)

Accounts receivable from sale of assets - 9,000,000.00 - -

Short-term loans payable - 10,853,636.42 - 8,003,636.42

Accrued interest expenses 4,150,000.00 3,550,000.00 - -

(Unit: Baht)



74

Short–term loans to related companies

Movements of short–term loans to related companies for each of the years ended December 31, 2008 and 2007 were as follows:

2008 2007 2008 2007

Balance at the beginning of the years - - - 19,295,894.86

Increase during the years - - 5,400,000.00 31,653,113.67

Decrease during the years - - (3,800,000.00) (50,949,008.53)

Balance at the end of the years - - 1,600,000.00 -

(Unit: Baht)



During the year 2008, the Company had short-term loan to The Crane Rayong Company Limited (“subsidiary”) with interest charged at MOR+0.5% per annum.

During the year 2007, the Company had short-term loans to related parties with interest charged at MOR+1 percent per annum for the loans to related companies and without interest charged for the loans to director.

Short–term loans from related parties

Movements of short–term loans from related parties for each of the years ended December 31, 2008 and 2007 were as follows:

2008 2007 2008 2007

Balance at the beginning of the years 10,853,636.42 8,023,636.42 36,002,422.31 8,580,636.42

Increase during the years 127,544.00 27,423,400.00 53,000,000.00 76,855,972.34

Decrease during the years (10,981,180.42) (24,593,400.00) (56,702,422.31) (49,434,186.45)

Balance at the end of the years - 10,853,636.42 32,300,000.00 36,002,422.31

(Unit: Baht)



During the period 2008, the Company borrowed short-term loan from The Crane Service Company Limited (“subsidiary”) in the amount of Baht 35.40 million with interest charged at MRR+2% per annum.

During the year 2007, the Company borrowed short-term loan from The Crane Rayong Company Limited (“subsidiary”) in the amount of Baht 6.40 million with interest charged at 8.62% per annum and short-term loan from The Crane Service

75

Company Limited (“subsidiary”) in the amount of Baht 21.60 million with interest charged at MRR+2% per annum and the remaining of short-term loan from related parties without interest charged.

Nature of relationship

Name Country Relation Type of relation

The Crane Lamechabang Co., Ltd. Thailand Subsidiary Direct holding

The Crane Rayong Co., Ltd. Thailand Subsidiary Direct holding

The Crane Heavy Lift Co., Ltd. Thailand Subsidiary Direct holding

The Crane Service Co., Ltd. Thailand Subsidiary Direct holding

Ruka Co., Ltd. Thailand Other related company Coordinator former management and/or shareholders

Line Transport Co., Ltd. Thailand Other related company Coordinator management

Bases of measurement for intercompany revenues and expenses

Pricing policies

Purchase - sale of land and machinery and equipment for rent or goods Market price

Rendering of rent and transportation services Market of price minus discount 20% - 60%

Rendering of repair services Market price

Services and administrative expenses Market price

Interest income and expense Market price On October 1, 2008 The Company and subsidiaries had the change pricing policies for the rendering of rent and transportation services from the market of price minus discount 20% - 60% to the market of price minus discount 20% - 35%.

6. CASH AND CASH EQUIVALENTS

Cash and cash equivalents as at December 31, 2008 and 2007 consisted of:

2008 2007 2008 2007

Cash on hand 398,244.47 349,069.02 208,244.47 131,815.02

Cash at banks - savings deposits 14,586,970.27 2,078,789.95 454,573.75 79,510.78

Cash at banks - current deposits 16,678,631.57 12,231,884.75 347,015.63 668,863.84

Total cash and cash equivalents 31,663,846.31 14,659,743.72 1,009,833.85 880,189.64

financial statementsfinancial statements

(Unit: Baht)


76

7. TRADE ACCOUNTS RECEIVABLE - NET

As at December 31, 2008 and 2007, the Company and subsidiaries had outstanding balances of trade accounts receivable aged by number of months as follows:

2008 2007 2008 2007

Trade accounts receivable - other

Current 57,426,621.78 27,410,119.08 8,827.50 94,015.55

Overdue

less than 3 months 75,188,067.32 50,008,476.30 22,533,003.08 4,688,023.80

Over 3 months up to 6 months 11,077,890.34 5,534,658.81 5,367,495.10 712,918.83

Over 6 months up to 12 months 428,025.27 6,095,778.53 172,893.62 -

Over 12 months 16,050,612.67 9,785,798.75 1,339,887.18 1,339,887.17

Total 160,171,217.38 98,834,831.47 29,422,106.48 6,834,845.35

Less: Allowance for doubtful accounts (17,183,857.44) (23,237,536.96) (1,514,887.17) (1,514,887.17)

Total trade accounts receivable - other 142,987,359.94 75,597,294.51 27,907,219.31 5,319,958.18

Trade accounts receivable - related companies

Current - - 7,047,720.11 7,377,547.25

Overdue

less than 3 months - - 47,594,021.02 26,730,502.51

Over 3 months up to 6 months - - - 381,403.86

Over 6 months up to 12 months - 108,408.12 - 108,408.12

Over 12 months 108,408.12 - 214,505.47 -

Total 108,408.12 108,408.12 54,856,246.60 34,597,861.74

Less: Allowance for doubtful accounts (108,408.12) (108,408.12) (108,408.12) (108,408.12)

Total trade accounts receivable - related

companies - - 54,747,838.48 34,489,453.62

Total trade accounts receivable - net 142,987,359.94 75,597,294.51 82,655,057.79 39,809,411.80


(Unit: Baht)


77

Movements of allowance for doubtful accounts for each of the years ended December 31, 2008 and 2007 were as follows:

2008 2007 2008 2007

Balance as at the beginning 23,345,945.08 11,704,854.68 1,623,295.29 2,398,093.10

Addition: Allowance for doubtful accounts 3,325,360.74 13,837,033.06 - -

Less: Reversal of allowance for doubtful accounts (9,379,040.26) (2,195,942.66) - (774,797.81)

Balance as at the end 17,292,265.56 23,345,945.08 1,623,295.29 1,623,295.29


(Unit: Baht)


8. ACCRUED INCOME - NET

Accrued income as at December 31, 2008 and 2007 consisted of:

2008 2007 2008 2007

Accrued income 5,637,210.27 21,292,668.50 1,972.60 -

Less: Allowance for doubtful accounts (350,000.00) - - -

Accrued income - net 5,287,210.27 21,292,668.50 1,972.60 -

Doubtful accounts during the years 350,000.00 - - -


(Unit: Baht)


During the year 2008, The Crane Heavy Lift Company Limited (“subsidiary”) has recorded the allowance for doubtful accounts for overdue accrued income over 2 months.

78

9. INVENTORIES - NET

Inventories as at December 31, 2008 and 2007 consisted of:

2008 2007 2008 2007

Cranes 67,169,497.91 82,745,704.41 67,169,497.91 84,517,077.06

Forklifts 39,412,642.91 46,926,423.75 41,917,333.51 46,926,423.75

Trailers 1,367,345.06 2,614,690.11 1,367,345.06 2,614,690.11

Trucks 988,202.51 763,740.50 1,063,740.50 763,740.50

Spare parts and equipment 6,357,043.24 4,015,779.71 6,757,042.24 4,015,779.71

Goods in transit and work in process 7,322,742.82 4,547,826.16 7,322,742.82 4,547,826.16

Total 122,617,474.45 141,614,164.64 125,597,702.04 143,385,537.29

Less Allowance for devaluation of inventories (22,030,602.45) (19,378,013.22) (22,030,602.45) (19,378,013.22)

Inventories - net 100,586,872.00 122,236,151.42 103,567,099.59 124,007,524.07


(Unit: Baht)


Movements of allowance for devaluation of inventories for each of the years ended December 31, 2008 and 2007 were as follows:

2008 2007 2008 2007

Balance as at the beginning 19,378,013.22 7,391,224.13 19,378,013.22 7,391,224.13

Addition: Loss from obsolete stock 2,652,589.23 11,986,789.09 2,652,589.23 11,986,789.09

Less: Reversal of loss from obsolete stock - - - -

Balance as at the end 22,030,602.45 19,378,013.22 22,030,602.45 19,378,013.22


(Unit: Baht)


79

10. OTHER CURRENT ASSETS - NET

Other current assets as at December 31, 2008 and 2007 consisted of:

2008 2007 2008 2007

Other receivables - net 31,546,122.89 11,241,815.90 22,593,066.52 7,039,162.76

Prepaid expenses 4,604,022.35 6,384,718.58 1,777,940.08 2,863,037.80

Deposits - 661,226.50 - -

Other assets - net 8,484,684.58 17,282,622.23 1,122,398.88 10,197,174.83

Total 44,634,829.82 35,570,383.21 25,493,405.48 20,099,375.39

Less: Allowance for doubtful accounts (3,549,759.94) (3,595,759.94) - -

Other current assets - net 41,085,069.88 31,974,623.27 25,493,405.48 20,099,375.39


(Unit: Baht)



2008 2007 2008 2007

Balance as at the beginning 3,595,759.94 3,461,779.16 - -

Addition: Allowance for doubtful accounts - 133,980.78 - -

Less: Reversal of allowance for doubtful accounts (46,000.00) - - -

Balance as at the end 3,549,759.94 3,595,759.94 - -


(Unit: Baht)


80

11. INVESTMENTS IN SUBSIDIARIES

Investments in subsidiaries stated by the cost method, as at December 31, 2008 and 2007 consisted of:

Subsidiaries 2008 2007 2008 2007 2008 2007

The Crane Lamechabang Co., Ltd. 100% 100% 25,000,000.00 25,000,000.00 24,999,300.00 24,999,300.00

The Crane Rayong Co., Ltd. 100% 100% 25,000,000.00 25,000,000.00 24,999,200.00 24,999,200.00

The Crane Heavy Lift Co., Ltd. 100% 100% 25,000,000.00 25,000,000.00 24,999,930.00 24,999,930.00

The Crane Service Co., Ltd. 100% 100% 100,000,000.00 100,000,000.00 99,993,000.00 99,993,000.00

Total 175,000,000.00 175,000,000.00 174,991,430.00 174,991,430.00

Cost methodAuthorized share capital

(Unit: Baht)

Holding (%)

12. RECEIVABLE UNDER REPURCHASE AGREEMENT - NET

Receivable under repurchase agreement as at December 31, 2008 and 2007 consisted of:

2008 2007 2008 2007

Receivable under repurchase agreement 45,820,560.75 45,820,560.75 - -


Receivable under repurchase agreement - net - - - -


(Unit: Baht)


Receivable under repurchase agreement occurred from The Crane Service Company Limited (“subsidiary”) putting up collateral against a financial lease agreement for its accounts receivable as the debt payment was defaulted upon with the financial institution (see Note 24).

13. RESTRICTED BANK DEPOSITS

As at December 31, 2008 and 2007, deposits at the bank of the Company and subsidiaries were used as collateral for letters of guarantee issued by banks (see Note 36).

81

14. RECEIVABLES FROM INSTALLMENT SALES

Receivable from installment sales as at December 31, 2008 and 2007 consisted of:

The receivable had committed to pay each year under the financial lease agreement as follows:

The Company had entered into the financial lease agreements for machinery and equipment for rent in the amount of Baht 1.89 million for the period 3.5 year from March 16, 2007 until March 16, 2010, receivable monthly totalling 42 instalments in the amount of Baht 0.04 million.

2008 2007 2008 2007

Receivable from installment sales 808,174.66

Year en

2 - 3 0.36 0.35

Minimun lease paym

1,218,383.28 808,174.66 1,218,383.28


(Unit: Baht)


t Present value resent value

1 0.54 0.4

0.90 0.81

0.90

0.36

Minimun lease payment P

6 0.54

0.81

0.35

0.46

Separate financial statemen

(U

tsConsolidated financial statements

nit: Millions Baht)

82

15. PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment as at December 31, 2008 and 2007 consisted of:

(Unit: B

Land Land Buildings Machinery and Furniture and Vehicles Machinery and Land and buildings Construction in Totalimprovements equipment office equipment equipment for rent for rent

aht)

progress and assetsin transit

CostAt January 1, 2007 478,361,102.45 7,001,939.29 125,545,196.28 14,039,821.32 29,339,978.25 37,395,841.24 1,085,379,446.97 3,563,066.00 4,393,764.30 1,785,020,156

s / transfer in -.10

Addition - 1,738,317.76 2,900,311.30 1,454,695.56 4,476,895.74 103,170,640.44 - 203,370,005.86 317,110,866 / transfer out -

.66Disposals - - (509,600.00) (645,966.72) (7,074,627.05) (150,489,787.72) - (5,770,752.76) (164,490,734

er 31, 2007 478,361,102.45.25)

At Decemb 7,001,939.29 127,283,514.04 16,430,532.62 30,148,707.09 34,798,109.93 1,038,060,299.69 3,563,066.00 201,993,017.40 1,937,640,288 ions / transfer in 6,794,132.00

.51Addit - 2,344,340.51 1,759,955.37 1,074,396.25 13,166,055.92 593,462,751.11 - 299,162,504.91 917,764,136

/ transfer out -.07

Disposals - - (1,937,706.24) (660,772.49) (9,017,305.71) (216,244,303.91) - (385,881,468.93) (613,741,557 er 31, 2008 485,155,234.45

.28)At Decemb 7,001,939.29 129,627,854.55 16,252,781.75 30,562,330.85 38,946,860.14 1,415,278,746.89 3,563,066.00 115,274,053.38 2,241,662,867

mulated depreciation.30

AccuAt January 1, 2007 - 3,402,763.76 47,018,379.25 10,327,896.89 22,128,995.70 18,464,231.60 397,430,439.64 1,281,643.63 - 500,054,350

iation charge for the year -.47

Deprec 1,315,346.57 6,298,431.37 1,698,828.23 2,616,647.56 6,753,393.90 157,461,327.96 99,999.96 - 176,243,975 -

.55Disposals - - (102,254.28) (314,402.18) (4,861,030.65) (80,530,386.47) - - (85,808,073

cember 31, 2007 -.58)

At De 4,718,110.33 53,316,810.62 11,924,470.84 24,431,241.08 20,356,594.85 474,361,381.13 1,381,643.59 - 590,490,252 iation charge for the year -

.44Deprec 1,296,256.59 6,379,145.58 2,223,967.47 2,184,800.73 6,521,938.55 168,479,169.39 99,999.95 - 187,185,278

-.26

Disposals - - (828,847.35) (478,451.44) (6,389,559.86) (91,694,281.66) - - (99,391,140 cember 31, 2008 -

.31)At De 6,014,366.92 59,695,956.20 13,319,590.96 26,137,590.37 20,488,973.54 551,146,268.86 1,481,643.54 - 678,284,390

f assets.39

Impairment oAt December 31, 2007 - - - - - - 1,000,000.00 - - 1,000,000

cember 31, 2008 -.00

At De - - - - - 2,928,000.60 - - 2,928,000 ok value

.60Net boAt December 31, 2007 478,361,102.45 2,283,828.96 73,966,703.42 4,506,061.78 5,717,466.01 14,441,515.08 562,698,918.56 2,181,422.41 201,993,017.40 1,346,150,036

er 31, 2008 485,155,234.45.07

At Decemb 987,572.37 69,931,898.35 2,933,190.79 4,424,740.48 18,457,886.60 861,204,477.43 2,081,422.46 115,274,053.38 1,560,450,476

Consolidated financial statements

.31

83

Depreciation of the Company and its subsidiaries for the year 2008, in the amount of Baht 172.68 million (year 2007: Baht 159.12 million) were included in cost of rental and transportation services, and Baht 14.51 million (year 2007: Baht 17.12 million) were included in selling and administrative expenses.

As at December 31, 2008, the Company and its subsidiaries had book value of fixed assets before less accumulated depreciation which have been fully depreciated and still in use totalling a cost of Baht 176.29 million (year 2007: Baht 152.18 million).

The Company and its subsidiaries had part of land with construction and machinery was pledge as collateral for bank overdrafts and loans from financial institutions (see Note 17).

In the year 2008, the Company and its subsidiaries had reclassified machinery and equipment for rent to inventories account in amount of Baht 109.07 million (year 2007: Baht 69.81 million) and recognized as costs of sales when disposed during the year.

The land and building for lease – The Crane Lamechabang Company Limited (“subsidiary”) allowed a person to lease such building. The rate of lease is Baht 7,000 per month.

The Crane Rayong Company Limted (“subsidiary”) allowed another company to lease land including construction of subsidiary. The details were shown as follows;

- 6 months lease period ending at May 31, 2007, that the rate of lease is Baht 0.03 million per month and 4 months lease period ending at September 30, 2007, that the rate of lease is Baht 0.05 million per month.

- 12 months lease period ending at November 30, 2008, that the rate of lease is Baht 0.42 million per month. On December 1, 2008, the Company entered into a new lease agreement the lease period is 12 months ending at November 30, 2009, that the rate of lease is Baht 0.42 million per month.

The Crane Service Company Limited allowed The Crane Lamechabang Company Limited to lease part of the land including construction for the period of 12 months ended at December 31, 2008 in the amount of Baht 0.01 million per month. On January 1, 2009, the Company extended lease period to 12 months ending at December 31, 2009, that the rate of lease is Baht 0.01 million per month.

In year 2008, The Crane Lamechabang Company Limited (“subsidiary”) is recognized impairment of assets for machinery and equipment for rent in the amount of Baht 1.93 million (year 2007: Baht 1 million).

84

t)(Unit: Bah

Land Land Buildings Machinery and Furniture and Vehicles Machinery and Construction in Total

improvements equipment office equipment equipment for rent progress and assets

in transit

Cost

At January 1, 2007 457,187,219.37 6,345,543.21 51,405,727.28 4,074,798.25 8,571,249.73 8,178,028.04 284,664,736.97 637,147.89 821,064,450

ns / transfer in -

.74

Additio - - 166,089.60 1,101,361.07 1,533,999.94 9,173,504.17 189,639,256.56 201,614,211

sals / transfer ou

.34

Dispo t - - - (39,000.00) (182,139.18) (1,829,999.94) (57,581,153.13) (430,962.31) (60,063,254

ember 31, 2007 457,187,219.37

.56)

At Dec 6,345,543.21 51,405,727.28 4,201,887.85 9,490,471.62 7,882,028.04 236,257,088.01 189,845,442.14 962,615,407

ns / transfer in 6,794,132.00

.52

Additio - - 210,039.97 259,099.72 10,110,203.44 285,667,264.54 172,047,239.43 475,087,979

sals / transfer ou

.10

Dispo t - - - - - (3,512,282.71) (4,223,840.28) (246,847,144.44) (254,583,267

ember 31, 2008 463,981,351.37

.43)

At Dec 6,345,543.21 51,405,727.28 4,411,927.82 9,749,571.34 14,479,948.77 517,700,512.27 115,045,537.13 1,183,120,119

mulated depreciation

.19

Accu

At January 1, 2007 - 2,821,253.87 7,962,708.03 2,174,602.81 5,325,669.28 3,104,509.35 52,181,999.77 - 73,570,743

iation charge for the yea

.11

Deprec r - 1,269,108.24 2,570,285.91 757,591.61 1,134,187.54 1,681,776.62 29,677,919.64 - 37,090,869

ls -

.56

Disposa - - (30,855.72) (135,635.66) (914,595.86) (20,919,673.16) - (22,000,760

ember 31, 2007 -

.40)

At Dec 4,090,362.11 10,532,993.94 2,901,338.70 6,324,221.16 3,871,690.11 60,940,246.25 - 88,660,852

iation charge for the yea

.27

Deprec r - 1,269,108.24 2,570,285.91 671,792.71 1,070,268.05 2,507,043.52 41,286,961.59 - 49,375,460

ls -

.02

Disposa - - - - (1,964,648.69) (3,335,636.32) - (5,300,285

ember 31, 2008 -

.01)

At Dec 5,359,470.35 13,103,279.85 3,573,131.41 7,394,489.21 4,414,084.94 98,891,571.52 - 132,736,027

ok value

.28

Net bo

At December 31, 2007 457,187,219.37 2,255,181.10 40,872,733.34 1,300,549.15 3,166,250.46 4,010,337.93 175,316,841.76 189,845,442.14 873,954,555

ember 31, 2008 463,981,351.37 986,072.86 38,302,447.43 838,796.41 2,355,082.13 10,065,863.83 418,808,940.75 115,045,537.13 1,050,384,091

Separate financial statements

.25

At Dec .91

85

Depreciation of the Company for the year 2008, in the amount of Baht 44.13 million (year 2007: Baht 30.69 million) were included in cost of rental and transportation services, and Baht 5.25 million (year 2007: Baht 6.40 million) were included in selling and administrative expenses.

As at December 31, 2008, the Company had book value of fixed assets before less accumulated depreciation which have been fully depreciated and still in use totalling a cost of Baht 23.77 million (year 2007: Baht 20.86 million).

Part of land with construction and machinery of the Company was pledge as collateral for bank overdrafts and loans from financial institutions (see Note 17).

During the year 2008, the Company had transferred machinery and equipment for rent to inventories account in the amount of Baht 0.89 million (year 2007: Baht 36.66 million) and recognized as cost of sales when disposed the assets between in the year.

As at December 31, 2008, the book value of machinery and equipment for rent and vehicle of the group of Baht 739.99 million (year 2007: Baht 420.17 million) and Baht 360.07 million (year 2007: Baht 178.74 million) in the separate financial statements presented as assets under financial lease agreements (see Note 23).

16. NON-OPERATING LAND

In the year 2006, The Crane Lamechabang Company Limited (“subsidiary”) has found non-operating land, which the subsidiary’s director received from a personal debt in the year 2003 and 2004. The land’s title deed is belong to the subsidiary’s name but did not record in its account. The Board of Directors Meeting of subsidiary held on December 15, 2006, approved to record the land of subsidiary and short-term loan from related party in the amount of Baht 3.98 million according to Intent to purchase and sales contract and approved the subsidiary’s director to purchase the land back from the subsidiary at the highest of the appraisal value by an independent appraiser or cost.

During the year 2007, the subsidiary sold such non-operating land at cost of Baht 3.98 million to related party (the director’s child of the Company) and the Company’s director in the amount of Baht 1.40 million and Baht 9 million respectively, that were appraisal value from an independent appraiser. The subsidiary recognized gain from sale of such land in the amount of Baht 6.42 million in the statement of income.

During the year 2008, The Crane Service Company Limited (“subsidiary”) sold such non-operating land at cost of Baht 2.07 million to the Company’s director in the amount of Baht 2.23 million that were appraisal value from an independent appraiser. The subsidiary recognized gain from sale of such land in the amount of Baht 0.12 million (net from selling expense in the amount of Baht 0.04 million) in the statement of income.

86

17. ASSETS USED AS COLLATERAL

The Company and subsidiaries have pledged part of land, including construction and machinery as well as the benefits from insurance of construction and machinery against bank overdrafts and loans from financial institutions with the full guarantee of the directors.

Moreover, the Company’s director mortgaged personal land including construction of Baht 41.60 million used as collateral for contingent liabilities from the Company’s financial lease agreement.

18. OTHER NON-CURRENT ASSETS - NET

Other non-current assets as at December 31, 2008 and 2007 consisted of:

2008 2007 2008 2007

Witholding tax - net 27,993,132.34 20,859,076.31 11,494,535.10 6,322,879.87

Deposits 7,921,972.43 667,522.50 7,255,299.43 642,383.00

Other assets - net 1,603,270.95 4,464,111.84 1,430,081.34 1,430,081.34

Total 37,518,375.72 25,990,710.65 20,179,915.87 8,395,344.21


Other non-current assets - net 36,425,166.98 21,210,981.27 20,179,915.87 8,395,344.21


(Unit: Baht)



2008 2007 2008 2007

Balance as at the beginning 4,779,729.38 1,829,729.38 - -

Addition: Allowance for doubtful accounts - 2,950,000.00 - -

Less: Reversal of allowance for doubtful accounts (3,686,520.64) - - -

Balance as at the end 1,093,208.74 4,779,729.38 - -


(Unit: Baht)


87

19. BANK OVERDRAFTS AND SHORT–TERM LOANS FROM FINANCIAL INSTITUTIONS

Bank overdrafts and short–term loans from financial institutions as at December 31, 2008 and 2007 consisted of:

2008 2007 2008 2007

Bank overdrafts 41,212,441.28 20,252,101.62 28,218,948.90 17,934,090.69

Promissory Notes 20,000,000.00 56,100,000.00 20,000,000.00 56,100,000.00

Trust receipts 68,489,265.65 28,297,174.01 68,489,265.65 28,297,174.01

Total 129,701,706.93 104,649,275.63 116,708,214.55 102,331,264.70


(Unit: Baht)


The Company and subsidiaries have credit lines for bank overdrafts in the amount of Baht 72 million for the consolidated financial statements and Baht 55 million for the separate financial statements bearing interest at the rate of MRR+2, MOR+0.5 and MOR per annum and have other credit facilities in the amount of Baht 441 million for the consolidated financial statements and Baht 421 million for the separate financial statements, with interest charged at the rate stipulated in the contracts. The Company and subsidiaries’ land including construction and part machinery were used as collateral for loans from the bank. The loans are also guaranteed by the Company and its subsidiary’s directors (see Note 17).

On October 16, 2008 The Company had pledged land including construction against the bank overdraft and short-term loans from a financial institution for credit line in the amount of Baht 120 million with the full personal guarantee of the directors of the Company.

20. TRADE ACCOUNTS PAYABLE

Trade accounts payable as at December 31, 2008 and 2007 consisted of:

2008 2007 2008 2007

Trade accounts payable - Domestic 27,219,147.33 24,970,422.18 104,164,198.37 93,803,352.17

Trade accounts payable - Oversea 176,414,316.95 308,618.42 176,414,316.95 308,618.42

Total trade accounts payable 203,633,464.28 25,279,040.60 280,578,515.32 94,111,970.59


(Unit: Baht)


88

21. OTHER SHORT–TERM LOANS

As at December 31, 2007, The Crane Rayong Company Limited (“subsidiary”) borrowed loan from another company (the Company’s customer) for its operation with interest charged at 12% per annum. The other company was able to deduct the loan against the last period of the subsidiary’s cash receipt from providing services.

22. OTHER CURRENT LIABILITIES

Other current liabilities as at December 31, 2008 and 2007 consisted of:

2008 2007 2008 2007

Estimated liabilities 1,254,782.75 7,282,784.47 - 6,028,001.72

Other payables 1,349,838.44 947,649.85 63,621.00 -

Deposits received 56,900.00 102,090.00 - -

Other 15,570,206.18 11,215,249.72 3,098,312.07 1,691,392.47

Total other current liabilities 18,231,727.37 19,547,774.04 3,161,933.07 7,719,394.19


(Unit: Baht)


23. LONG–TERM DEBT

Long–term debt as at December 31, 2008 and 2007 consisted of:

2008 2007 2008 2007

Loans from banks 76,832,000.00 226,530,631.90 57,500,000.00 211,598,559.28

Liabilities under financial lease 444,746,496.98 444,223,382.15 210,917,379.21 268,653,121.16

Liabilities under restructuring agreements - 3,821,714.10 - -

Total 521,578,496.98 674,575,728.15 268,417,379.21 480,251,680.44

Less: Current portion of long-term

liabilities (221,016,245.15) (230,233,176.40) (135,616,165.94) (147,212,642.27)

Long-term debt - net 300,562,251.83 444,342,551.75 132,801,213.27 333,039,038.17


(Unit: Baht)


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Loans from banks

The Details of the loans are summarized as follows:

Principal (Thousands Baht) Lender 2008 2007 Period Interest Rate Repayment Company Bank 57,500 211,500 Dec. 2006 – Dec. 2011 MLR Monthly principal repayment with interest

(principal Baht 4.50 million per month) Bank - 99 Apr. 2003 – Jan. 2008 MRR Monthly principal repayment with interest

(Baht 0.60 million per month) Subsidiaries Bank 19,332 - Oct. 2008 – Oct. 2013 MLR Monthly principal repayment with interest

totalling 60 instalments Bank - 14,932 Jan. 2006 – Dec. 2013 MLR + 1.5 Monthly principal repayment with interest

totalling 84 instalments 76,832 226,531

As at December 31, 2008 the Company and subsidiaries had loans from banks, the current portion of long-term loans in the amount of Baht 58.01 million (year 2007: Baht 57.83 million) for the consolidated financial statements and Baht 54 million (year 2007: Baht 54.10 million) for the separate financial statements was presented under current liabilities.

The Company and subsidiaries had pledged land, including construction and machinery as well as the benefits from insurance of construction and machinery, against loans from financial institutions with the full personal guarantee of the directors of the Company and Subsidiaries (see Note 17).

On February 12, 2008, The Crane Rayong Company Limited (“subsidiary”) entered into a debt restructuring agreement in order to alleviate the condition of repayment debts. According to the agreement, the subsidiary repaid such debts by monthly installments each not less than Baht 0.25 million with interest charged at the rate of MLR+1.50% per annum starting with the first installment from February 2008 and to be completed before or within January 2015. Subsequently, On July 9, 2008, the subsidiary repaid the remaining of loan from bank in whole amount.

On October 13, 2008, The Crane Rayong Company Limited (“subsidiary”) borrowed loan from a financial institution in the amount of Baht 20 million with credit line for the bank overdraft in the amount of Baht 15 million. The Subsidiary had pledged land including construction against the loan from a financial institution with the guaranteed by the Company. The Subsidiary had received the loan from a financial institution on October 20, 2008.

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Liability under Financial Lease

The Company and subsidiaries had entered into the financial lease agreements for machinery and equipment for rent and for vehicles, payable monthly in the amount of Baht 10.83 million and Baht 9.49 million, respectively. As at December 31, 2008, the current portion of liability under the financial lease agreement in the amount of Baht 163.01 million (year 2007: Baht 170.94 million) for the consolidated financial statements and Baht 81.62 million (year 2007: Baht 93.11 million) for the separate financial statements was presented under current liabilities.

Moreover, the Company and subsidiaries had committed to pay each year under the financial lease agreement as follows:

Year Minimun lease payment Present value Minimun lease payment Present value

1 199.87 163.01 101.93 81.62

2 - 5 316.29 281.74 149.95 129.30

516.16 444.75 251.88 210.92

Separate financial statementsConsolidated financial statements

(Unit: Millions Baht)

In year 2008, the Company and subsidiaries had purchased the machines and equipments for rent and vehicles in the amount of Baht 270.94 million (year 2007: Baht 312.36 million) by entering into financial lease agreements to various leasing companies, which some agreement the Company’s director mortgaged personal land including construction of Baht 41.60 million used as collateral for contingent liabilities from the Company’s financial lease agreement (see Note 17).

Liability under Restructuring Agreements

The Crane Service Company Limited (“subsidiary”) had long-term loans from financial institutions and had defaulted on the debt. On October 30, 2000, the subsidiary entered into debt restructuring agreements with all financial institutions stating that the subsidiary had to pay principal with interest charged as stipulated in the debt restructuring agreements. As at December 31, 2007, the current portion of liability under the debt restructuring agreements in the amount of Baht 1.46 million was presented under current liabilities. At present, the subsidiary repaid the remaining of liability under restructuring agreements in whole amount.

24. LIABILITY FROM REPURCHASE AGREEMENT

On December 16, 1996, The Crane Service Company Limited (“subsidiary”) has sold assets to a customer by financial lease through a Leasing Company; on condition that subsidiary has joint responsibility to repurchase assets if the customer does not perform according to the agreement.

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On October 8, 2001, the subsidiary had entered into a debt confirmation letter with a Leasing Company because the subsidiary’s customer did not perform according to the agreements in the amount of Baht 73.62 million. A debt confirmation letter indicated that the Subsidiary had to pay principal and interest which the first repayment started on October 2001. The liabilities are also fully guaranteed by the subsidiary’s directors.

From the above details, the subsidiary recorded the lessee to accounts receivable from repurchase agreement that were presented under current assets in the amount of Baht 45.82 million (see Note 12) according to the amount to be repaid by the subsidiary. The subsidiary has reclaimed the debt in the amount of Baht 68.20 million.

In the year 2001, the leasing company was in litigation with the lessee and in the year 2003, the court of first instance held the lessee, the subsidiary and director to join responsibility for payment to the leasing company in the amount of Baht 5.96 million with interest charged at 7.5 percent per annum since the litigation date until fully paid.

On October 24, 2006, the subsidiary entered into an additional amendment of debt confirmation letter that the conditions of repayment were amended from additional amendment of debt confirmation letter dated September 24, 2005 as follows:

1. The subsidiary had outstanding debt before preparing the memorandum in the amount of Baht 2.20 million, so the installment of debt was taken into the new principal of debt as indicated in this memorandum.

2. The subsidiary has to pay the principal by installment started from October 2006 to October 2011 as the indicated amount of the payment schedule enclosed with the contract with interest charged at 10 percent per annum.

The Subsidiary had paid post dated cheque as collateral in the amount of Baht 60.03 million.

During the year 2007, the Appeal Court judged lessee company and subsidiary including director together to under take repayment to leasing company in the amount of Baht 5.40 million including interest at the rate of 10% per annum from June 21, 2006 until the date the claim was filed and at the rate of 7.5% per annum starting from the date the claim was filed until complete repayment.

At present, the subsidiary has not repaid the principal and interest as per the agreement. The subsidiary litigated with the creditor relating to alleged overstated debt on April 18, 2007. However, the subsidiary has still recorded accrued interest expense at the rate determined in the agreement. The subsidiary does not use the default interest rate because a legal consultant expressed his opinion that the subsidiary has a chance to win the case. Therefore, the subsidiary reclassified such liability to current liability.

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25. OTHER NON-CURRENT LIABILITIES

Other non-current liabilities as at December 31, 2008 and 2007 consisted of:

2008 2007 2008 2007

Retention 10,013,560.52 12,405,564.36 218,926.00 296,531.50

Deposits received - - 95,700.00 95,700.00

Other non-current liabilities 10,013,560.52 12,405,564.36 314,626.00 392,231.50


(Unit: Baht)


26. SHARE CAPITAL

The Company

The Board of Directors’ Meeting held on January 30, 2008, passed a resolution to offer common shares for an increase in the Company’s share capital of 100 million shares to the public for subscription shares on February 1, 4 and 5, 2008 at the offering price of Baht 2.80 per share, totaling Baht 280 million. The Company has recorded the underwriting fees concerning the offering of its increased share capital of approximately Baht 20.45 million as deduction in “Premium on share capital”. The Company registered the change in its authorized share capital for such increase in share capital with the Ministry of Commerce on February 7, 2008.

The Ordinary General Meeting of Shareholders held on March 15, 2007, passed a resolution to increase the Company’s authorized share capital from Baht 350 million to Baht 450 million by issuing new common shares of 100 million shares at par value of Baht 1 per share. For the increased in share capital, the resolution assigned the authorizing to the Company’s Board of Directors in considering and determining all of the details concerning offering price, offering method, offering period, and the allotment method of the remaining shares left after subscription, regarding the offering to the public.

27. SHARE PREMIUM

Section 51 of the Public Companies Act B.E. 2535 requires companies to set aside share subscriptions received in excess of the par value of the shares issued to a reserve account (“share premium”). Share premium is not available for dividend distribution.

28. LEGAL RESERVE

According to the Public Limited Companies Act B.E. 2535, the Company is required to set aside a statutory reserve at least 5 percent of its net profit after deducting accumulated deficit brought forward (if any) until the reserve reaches 10 percent of the registered share capital. The statutory reserve could not be used for dividend payment.

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29. DIVIDENED PAYMENT AND LEGAL RESERVE

The Company

At the Ordinary General Meeting of Shareholders held on April 24, 2008, a resolution was passed authorizing a dividend payment at the rate of Baht 0.1 per share, totaling Baht 45 million.

Subsidiary

At the Ordinary General Meeting of Shareholders of The Crane Service Company Limited held on March 10, 2008, a resolution was passed authorizing a dividend payment at the rate of Baht 210 per share, totaling Baht 21 million and approved an additional appropriated legal reserve of Baht 1.05 million.

30. OTHER INCOME

Other income for each of the years ended December 31, 2008 and 2007 consisted of:

2008 2007 2008 2007

Revenue from other service 1,015,098.12 1,361,527.31 17,371,983.83 16,361,527.31

Revenue from rental 5,053,200.00 5,176,100.00 1,748,400.00 1,748,400.00

Interest income 323,665.00 609,757.91 209,329.85 258,230.84

Gain on foreign exchange 3,082.82 706,463.07 - 688,210.74

Gain on sale of assets 1,824,963.98 8,182,319.58 155,443.40 489,683.96

Others 18,481,631.17 4,251,679.00 1,205,683.74 1,712,018.81

Total other income 26,701,641.09 20,287,846.87 20,690,840.82 21,258,071.66


(Unit: Baht)


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31. EXPENSES BY NATURE

Expenses by nature for each of the years ended December 31, 2008 and 2007 consisted of:

2008 2007 2008 2007

Supplies used 26,233,719.57 19,541,593.63 26,233,719.57 19,541,593.63

Salaries and other related benefits

payable to employee 127,852,409.18 125,155,080.54 53,632,677.17 51,409,565.90

Fuel expenses 25,441,986.89 24,812,318.02 2,005,693.60 1,807,321.09

Rental and transportation expenses 29,091,023.34 13,897,479.91 1,130,789.07 451,450.00

Insurance expenses 9,362,360.86 9,148,783.24 2,887,866.14 2,024,295.06

Maintenance expenses 15,502,453.38 14,119,132.84 1,024,680.03 2,508,218.70

Depreciation 187,185,278.26 176,243,975.55 49,375,460.02 37,090,869.56

Commission expenses 14,678,423.01 4,821,095.02 5,496,812.89 1,228,895.79

Loss on exchange rate 24,232,397.08 - 24,232,397.08 -


(Unit: Baht)


32. FINANCE COSTS

Finance costs for each of the years ended December 31, 2008 and 2007 consisted of:

2008 2007 2008 2007

Interest expenses 73,967,509.13 74,136,866.03 42,188,188.21 48,658,034.68

Bank charge fees 826,418.50 250,230.00 600,000.00 200,000.00

Total finance costs 74,793,927.63 74,387,096.03 42,788,188.21 48,858,034.68


(Unit: Baht)


33. INCOME TAX EXPENSE

Income tax reduction

Royal Decree No. 475 B.E. 2551 dated July 29, 2008 grants companies listed on the Market for Alternative Investment on or before enactment a reduction in the corporate income tax rate from 30% to 20% for taxable profit not exceeding Baht 20

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million for the three consecutive accounting periods beginning on or after January 1, 2008. The Company has, accordingly, calculated income tax of its taxable profit for the year ended December 31, 2008 at the 20% corporate income tax rate.

34. PROVIDENT FUND

The Company and its employees jointly registered a provident fund scheme under the Provident Fund Act B.E. 2530. The fund is contributed to by both the employees and the Company. The fund is managed by BT Asset Management Company Limited and will be paid to the employees upon termination in accordance with the rules of the fund. During the year 2008, Baht 876,925.81 (In 2007: Baht 683,198.27) has been contributed to the fund by the Company.

35. EMPLOYEE EXPENSES

Employee expenses for each of the years ended December 31, 2008 and 2007 consisted of:

2008 2007 2008 2007

Salaries and wages 109,521,551.85 112,520,660.44 45,899,799.76 45,118,574.58

Bonus 9,736,202.61 4,805,969.42 4,673,350.59 3,585,124.00

Contribution to provident fund / social security 4,848,408.85 4,447,613.50 1,830,075.81 1,697,203.27

Others 3,746,245.87 3,380,837.18 1,229,451.01 1,008,664.05

Total 127,852,409.18 125,155,080.54 53,632,677.17 51,409,565.90

Number of employees at the end of the years (Persons) 431 449 131 138


(Unit: Baht)


36. COMMITMENTS AND CONTINGENT LIABILITIES

As at December 31, 2008, the Company and its subsidiaries had commitments and contingent liabilities as follows:

The Company

Commitments

- Commitment for the letter of guarantee issued by the Bank in the amount of Baht 0.23 million (see Note 13).

- Commitment for payment under the security service agreement in the amount of Baht 0.12 million per month.

- Commitment for payment under the land lease agreement in the amount of Baht 0.06 million per month.

- Commitment from legal advisory fee in the amount of Baht 0.05 million per month.

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Contingent liabilities

- Contingent liabilities on co-guarantee for liabilities under financial lease with subsidiaries in the amount of Baht 279.22 million.

- Contingent liabilities from lease back agreement together with subsidiaries in the amount of Baht 12.24 million.

- Undue L/C in the amount of YEN 38.57 million.

Subsidiaries

Commitments

- Commitment for the letter of guarantee issued by the Bank in the amount of Baht 2.36 million (see Note 13).

- Commitment for payment under the land lease agreement to the director of the Company in the amount of Baht 0.05 million per month.

- Commitment for payment under the building lease agreement with a related company in the amount of Baht 0.15 million per month.

- Commitment for payment under the management agreement with a related company (the Parent company) in the amount of Baht 1.25 million per month.

- Commitment for payment under the security and cleaning service agreement with a company in the amount of Baht 0.06 million per month.

Contingent liabilities

- Contingent liability on co-guarantee for liabilities under financial lease with the Company in the amount of Baht 261.10 million.

- The Crane Service Company Limited is litigating a case brought against it involving compensation of breach debt confirmation agreement in the amount of Baht 66.54 million and compensation from cheque default of Baht 0.96 million (see Note 39).

- The Crane Heavy Lift Company Limited is litigating a suit brought against it for a claim of Baht 1.32 million (see Note 39).

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37. BUSINESS SEGMENT INFORMATION

The Company and subsidiaries operate the business primarily related to sales and services of cranes, forklifts, trailers and trucks. Based on the types of activities, the operating income for each of the years ended December 31, 2008 and 2007 were classified as follows:

For the year ended December 31, 2008

Sales Service Eliminate Total

Revenue 672,360 669,757 (552,562) 789,555

Cost (491,302) (575,939) 533,712 (533,529)

Gross profit 181,058 93,818 (18,850) 256,026

Other income 26,701

Selling and administrative expenses (159,244)

Finance costs (74,794)

Income tax (17,136)

Net profit 31,553

Fixed assets as at December 31, 2008 1,560,450

Total assets as at December 31, 2008 1,925,591

(Unit: Thousands Baht)

For the year ended December 31, 2007

Sales Service Eliminate Total

Revenue 444,966 673,131 (396,783) 721,314

Cost (309,693) (561,685) 442,990 (428,388)

Gross profit 135,273 111,446 46,207 292,926

Other income 20,288

Selling and administrative expenses (142,412)

Finance costs (74,387)

Income tax (17,594)

Net profit 78,821

Fixed assets as at December 31, 2007 1,346,150

Total assets as at December 31, 2007 1,651,587

(Unit: Thousands Baht)

38. FINANCIAL INSTRUMENTS

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Accounting Policies

The details of significant accounting policies and methods used for classification of financial assets and financial liabilities including valuation, basis of recognition of income and expenses are disclosed in Note 3.

Financial risk management policies

The Company is exposed to fluctuations in interest rates and foreign exchange rates in the market and the risks from default of the agreements by counterparties. The Company had risk management polices as follows:

Interest Rate Risk

Interest rate risk is the fluctuation of the market interest rate in the future that will affect the Company’s operations and cash flows. The Company has interest rate risk from cash and deposits at banks, bank overdrafts and from loans because the interest rate of the financial assets and financial liabilities fluctuate based on the market rate. In addition, the Company has not engaged in any hedging contracts related to interest rates.

Foreign Currency Risk

The Company’s exchange rate risk primarily involves the purchases and sales of goods in foreign currencies. As at December 31, 2008 and 2007, the Company had assets and liabilities in foreign currencies, without hedging, as follows:

Currencies Assets Liabilities Assets Liabilities

YEN - 628.34 - 95.70

(Unit: Millions)

2008 2007

Credit Risk – Trade Accounts Receivable

The Company has a policy to hedge credit risk from trade accounts receivable by forming a conservative credit policy and by determining the receipt from the sales of goods and service. Therefore, the Company expects that the loss from the collection of those trade accounts receivable should not exceed the provision for doubtful accounts.

Fair Value

Most of the financial assets are trade accounts receivable which are short-term credit and financial liabilities. Most of the financial liabilities are trade accounts payable and bank overdrafts with interest rates close to the market rate. The carrying amount of the financial assets and financial liabilities are not significantly different from their fair value.

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39. LITIGATION

Subsidiaries

The Crane Heavy Lift Company Limited (“subsidiary”) received notice from the Department of Legal Execution (as at November 10, 2005) informing it of the cancellation of an agreement and to let the subsidiary pay rent to the official receiver of Mr. Suchin Sittirarat (landlord). The notice stated that the subsidiary has rented the land with title deed no.39562 in Patumthani and that the subsidiary has not paid rent since February 1, 2002 until now (September 30, 2005). The total is 44 installments, so this agreement has been terminated pursuant to clause 12 of the contract. The official receiver informed the subsidiary of the agreement cancellation and that the subsidiary has to return the land by removing everything including people off the land and to make rest of the payment of Baht 13.60 million to the official receiver. Subsequently, on November 25, 2005 the subsidiary denied the debt to the official receiver stating that the subsidiary never had a land rental agreement with Mr. Suchin Sittirarat, contrary to what the official receiver notice alleges, as the subsidiary has an agreement with a subsidiary’s director (see Note 36). As at December 31, 2005 the subsidiary has recorded the accrued expenses in the amount of Baht 2.35 million. Regarding the above accrued expenses, the subsidiary’s director does not accept until the lawsuit is finished. In case the subsidiary has any damage, the subsidiary’s director is willing to deny receiving rent from subsidiary. Therefore, the subsidiary has provided an allowance for any damage. Then, the subsidiary hired UK Valuation and Agency Company Limited as an independent appraiser to appraise such monthly rental fee for the land, which the subsidiary will set up an allowance for additional damage on a monthly basis following the monthly market rental fee which was appraised by the independent appraiser. As at December 31, 2008 the subsidiary had set up an allowance for damage in the amount of Baht 10.67 million. However, if the subsidiary loses more than such provision, the subsidiary’s director will be responsible for the total in excess.

As at December 31, 2008 The Crane Heavy Lift Company Limited (“subsidiary”) is litigating a suit brought against it for a claim of Baht 1.32 million. The case is pending decision in civil court. However, the subsidiary company had still not recorded any potential liabilities.

As at December 31, 2008 The Crane Service Company Limited (“subsidiary”) had litigation as follows:

- A litigation suit brought against it involving the services of Baht 1.98 million. However, the subsidiary has already recorded the provision in respect of potential liability of Baht 0.49 million. If the subsidiary has any damage, the subsidiary’s directors will take responsibility. At present, such case is in the process of the civil court consideration.

- A litigation suit brought against it involving compensation of breach debt confirmation agreement in the amount of Baht 66.54 million and a litigation suit brought against it involving compensation from cheque default of Baht 0.96 million. Such case is in the process of the Court’s consideration. However, the subsidiary has not yet recorded a provision of potential liabilities because the subsidiary has the opinion that the subsidiary will not lose. The subsidiary filed a suit against a creditor relating to overstated debt on April 18, 2007 (see Note 24).

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40. SUBSEQUENCE EVENT

On February 1, 2009 and February 3, 2009, The Crane Heavy Lift Company Limited entered into financial lease agreements with a company amounting to Baht 1.69 million.

41. RECLASSIFICATION

Certain accounts in the year 2007 financial statements have been reclassified to conform to the year 2008 financial statements presentation, for comparative purposes.

42. APPROVAL OF FINANCIAL STATEMENTS

These financial statements have been approved for issue by the authorized directors on February 6, 2009.

crane : annual report 2008

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