No.BorPor. 221/136 Office

August 22, 2001

Re: Management Discussion and Analysis of the consolidated financial statements for the year ended June 30, 2001

Attention: President The Stock Exchange of

Attachment: Consolidated financial statements for the year ended June 30, 2001

Banpu Public Company Limited (the “Company”) submit herewith the Company’s financial statements and consolidated financial statements for the year ended June 30, 2001 for further disclosure to investment community. The following are explanation of the consolidated financial results for the fourth quarter and for the year ended June 30, 2001 and 2000. These statements should be read in conjunction with the Company’s consolidated financial statements.

1.! Consolidated Income Statements 1.1! Consolidated Income Statements for the fourth quarter ended June 30, 2001 1.1.1! Consolidated sales revenue was Baht 1,447 million, an increase of Baht 263 million or 22% from the same period last year. Details are as follows: !! Revenue from sales was Baht 1,060 million, accounted for 73% of total sales revenue. The increasing of Baht 326 million or 44% resulted from the commercial operation of in Indonesia. !! Revenue from EGAT overburden removal contract was Baht 218 million or 15% of total sales revenue, decreased Baht 106 million it is now close to the ended of contract life. !! Revenue from industrial minerals was Baht 95 million or 7% of total sales revenue, an increase of Baht 28 million or 43% compared to the same period last year, resulting from higher growth of local ceramic and sanitary ware producer as well as greater volume of exports to overseas market. !! Revenue from port handling services was Baht 38 million or 3% of total sales revenue, also increased from the same period last year by Baht 8 million or 24% due to higher automobile export. !! Revenue from other services was Baht 36 million or 2.5% of total sales. The increasing of Baht 9 million derived from services for transportation of imported coal rendered to customers. 1.1.2! Participating loss in Associated companies computing on equity basis were Baht 21 million of which Baht 25 million was gained from operation and Baht 46 million from unrealized FX loss. 1.1.3! Consolidated cost of sales was Baht 1,187 million, an increase of Baht 167 million or 16% relating to higher sales revenue as mentioned in item 1.1.1

1/5 1.1.4! The company registered consolidated gross profit for this quarter Baht 260 million contributed a gross profit margin of 18%, a 4% increased from the same period last year. 1.1.5! Consolidated selling and administrative expenses were Baht 227 million, an increase of Baht 64 million. The major items were for organizational development program as well as financial, tax and legal advisor fee. 1.1.6! Extra ordinary expenses of Baht 54 million comprising of loss on impairment of assets and also writing off inactive project. The Company has applied new accounting principal on a conservative policy to assure a fair value. 1.1.7! Financial expenses of Bond redemption amounting to Baht 122 million were premiums and expenses occurred from early redemption of ECD#2 of US$ 7.375 million in this quarter. Early redemption of ECD#2 was management strategy to reduce redemption expenses and mitigate FX risk which will be higher at maturity in April 2003. 1.1.8! Consolidated interest expenses were Baht 132 million, an increase of Baht 8 million or 6% resulted from an issuance on Baht bond (BANPU#5 and BANPU#6) totaling of Baht 3,000 million in April 2001. 1.1.9! Net loss for this quarter was Baht 89 million compared to last year, which registered loss of Baht 355 million. Loss per share for this quarter was Baht 0.42 compared to loss of Baht 1.70 per share for the same period last year.

1.2! Consolidated Income Statements for the year ended on June 30, 2001 1.2.1! Consolidated sales revenue were Baht 5,734 million, an increase Baht 1,295 million or 29% from the same period last year. Details are as follows: !! Revenue from coal sales was Baht 3,939 million, accounted for 69% of total sales. The increasing of Baht 1,221 million or 45% was resulted from the commercial operation of coal mining Indonesia and export to the international market, which has achieved beyond plan. !! Revenue from EGAT overburden removal contract was Baht 1,155 million or 20% of total sales revenue, decreased by Baht 99 million or 8%. !! Revenue from industrial minerals was Baht 335 million or 6% of total sales revenue. The increasing of Baht 106 million or 46% was resulted from an increase in sales of ball clay and kaolin in Thailand as well as sales to international market, including sales of Calcium Carbonate

(CaCO3 ) from subsidiary in Vietnam. !! Revenue from port handling services was Baht 156 million or 3% of total sales, The increasing of Baht 38 million or 33% was resulted from higher automobile export. !! Revenue from other services was Baht 150 million or 3% of total sales revenue. The increasing of Baht 29 million derived from stock management and transportation services for imported coal rendered to customers. 1.2.2! Profit from sales of investment amounting to Baht 3,632 million derived from the divestment of an investment in The Cogeneration Public Company Limited (COCO) in August and November 2000 totaling 234.53 million shares to Sithe Pacific Holding under the Call Option Agreement. In addition, the

2/5 Company sold the rest of 10.78% in COCO totaling 129.95 million shares to Tracteble S.A. in February 2001. 1.2.3! Gained from exchange rate for the year ended June 30, 2001 was Baht 157 million, compared with loss of Baht 140 million last year. The company has reduced foreign currency risk by hedging full amount of foreign currency debts obligation. In addition, the company possessed the assets for USD 52.36 million as convertible loan to an Indonesian company in acquiring the ownership of four coal mines in Indonesia so called “INDOCOAL”. 1.2.4! Consolidated others income was Baht 365 million, an increase of Baht 136 million derived from project development fees, which has received from other company. 1.2.5! Participating loss in associated companies was Baht 556 million. This amount is comprises of gained from operational performance Baht 96 million and Baht 653 million was from unrealized loss on foreign exchange. 1.2.6! Consolidated cost of sales was Baht 4,776 million, an increased of Baht 1,114 million or 30% related to an increase in sales revenue as mentioned in item 1.2.1 1.2.7! Consolidated gross profit was Baht 958 million contributed a gross profit margin of 17%. 1.2.8! Consolidated selling and administrative expenses were Baht 1,033 million, an increased of Baht 452 million compared to last year. The major items were from financial advisor, tax and legal advisor including other expenses spent in acquiring of coal mines in Indonesia in March 2001. Also included spending for marketing research, development expenses as well as personnel and management system development program. The Company has selected to implement Value Based Management System to strengthen organization capabilities and competitiveness and ultimately create shareholders’ value added in long run. All expenses have fully been recognized in fiscal year ended June 30, 2001. 1.2.9! Extra ordinary expenses of Baht 360 million is comprises of a allowance for decrease in investment value, loss from impairment of assets, and written off inactive projects. The Company has applied new accounting principle on a conservative basis to assure a fair value presentation of its financial performance. 1.2.10! Financial expenses from bond redemption of Baht 242 million derived from the redemption premium of the Euro Convertible Debenture (ECD#2) in the amount of USD 30.32 million. The Company has focused to mitigate foreign currency liabilities and minimize redemption premium prior to maturity in April 2003. 1.2.11! Consolidated interest expenses was Baht 466 million, decreased by Baht 4 million or 1% compared to last year. This was resulted from early redemption of on ECD#2 and local debenture (BANPU#2), including loan repayment during this year. 1.2.12! Net profit for the fiscal year was Baht 2,314 million. Earnings per share were Baht 11.04 compared to loss of Baht 5.48 per share last year.

3/5 2.! Consolidated Balance Sheets as of June 30, 2001 and 2000 2.1.! Total assets were Baht 17,118 million, increased Baht 3,349 million or 20% compared to June 30, 2000. Details are as follows: !! Cash on hand and at bank and short-term investment increased Baht 1,720 million. This surplus derived from divestment of an investment in The Cogeneration Public Company Limited. !! Accounts and notes receivable-net increased Baht 159 million or 24% as a result of an increase in sales revenue of a subsidiary company in Indonesia. !! Inventories decreased Baht 45 million or 10% due to higher inventory turnover. !! Other current assets increased Baht 15 million or 6% resulting from registering accrued income for project development fee from other company. !! Loans and advances to associate, related and other companies increased Baht 2,564 million resulting from providing financial support as convertible loan to an Indonesian company in acquiring of four coal mines so called “INDOCOAL” in accordance with the financial support agreement. !! Investments in subsidiary and associated companies decreased Baht 3,499 million, derived from sales of 364.48 million ordinary shares in The Cogeneration Public Company Limited (COCO). !! Other investments increased Baht 2,341 million due to an investment in Ratchaburi Electricity Generating Holding Public Company Limited. !! Other assets decreased Baht 156 million resulting from amortization of deferred expenses to cost of production. 2.2. Total liabilities increased Baht 2,189 or 31% compared to June 30, 2000. Details are as follows: !! Bank overdraft and loans from bank increased by Baht 176 million or 20% were for short-term working capital. !! Accounts and notes payable decreased by Baht 153 million or 69%. !! Accrued interest payable increased Baht 6 million or 9% resulting from interest payable is not become due yet. !! Long-term loan increased by Baht 458 million. The proceeds is used for local bond (BANPU#2) repayment of Baht 600 million. !! Debentures increased by Baht 1,377 million or 29% resulted from new issuance of Baht 3,000 million local bond settled with ECD#2 redemption of USD 30.32 million. 2.3.! Shareholder’s equity increased Baht 1,160 million or 18% derived from:- 2.3.1 Net profit after tax for this period of Baht 2,314 million; 2.3.2 Two times dividend paid to shareholders at Baht 1 and Baht 3 per share in October 2000 and March 2001 respectively, totaling Baht 838 million; 2.3.3 Reserve for unrealized loss on non-current marketable securities and; 2.3.4 Decrease in surplus from change of shareholding in subsidiary company. 2.4.! Net debt to equity ratio as of June 30, 2001 for the consolidated balance sheets was 1.09 times and for the parent company was 1.16 times higher than June 30, 2000 which were 0.99 and 1.07 times respectively.

3.! Cash flow statements The consolidated Cash flow statements for the year ended on June 30, 2001 presented net cash received from operating activities by Baht 1,617 million, accounted for cash flow return on equity (beginning of period) of 24.47%. Net cash provided from investment activities was Baht 276 million. It is a net of divestment of shares in COCO and new capital investment in Ratchaburi Electricity Generating Holding Public Company Limited as well as

4/5 loans to related company. Net cash received from financing was Baht 667 million derived from new issuance of Baht bond and dividend paid of Baht 838 million to shareholders in October and March 2001.

4.! Management Review The Company’s performance for the year ended June 30, 2001 has seen better results in most key areas i.e. business expansion, sales growth and profitability. The increase in sales revenue was Baht 1,295 million or 29% over the previous year with gross profit margin at 17% of revenue or 3% better than last year. Significant increases in sales revenue came from the coal production and sales from Jorong mine, Indonesia, which has achieved better than target and also has indicated a positive trend. The company has diversified its power business portfolio by divestment of equity interest in The Cogeneration Public Company Limited. The proceed from such transaction was utilized for equity investment in Tri Energy Co., Ltd. and Ratchaburi Electricity Generating Holding Public Company Limited in July and October respectively. These provide more flexibility in investment portfolio and significantly mitigate both business and financial risks to company. In response to increasing in coal demand, the company has further expand to be one of international coal supplier by possessing of 4 coal mining assets in Indonesia collectively called “INDOCOAL”. As a result the company will substantially gain benefits in respect of securing long-term marketable coal supplies, being the prominent and sizable Coal company, increasing competitiveness with more products variety to meet customers’ needs both in Thai and International market. The company is in the process of integrating Indocoal management system and work process including shareholding structure. The company has issued domestic debentures of Baht 3,000 million. The proceeds is earmarked for early redemption of ECD#2 and local bond (Banpu#3) including loan repayment. Therefore, the company’s financial position was strengthening with lower cost. The risk management committee was established to closely monitor and mitigate all potential financial risk. In order to prepare the readiness to meet business expansion both in Thailand and in the region. The company has provided budget for organizational improvement and gives high priority to human resource development, as well as applies modern management system to create higher value. Organization Restructuring was underway to cope with the long-term plan and drive the company to sustainable growth in the long run.

Please be informed accordingly.

Sincerely yours,

Chanin Vongkusolkit Chief of executive officer

5/5