THE SHAREHOLDERS of TOT PUBLIC COMPANY LIMITED the Consolidated Financial Statements of TOT Public Company Limited and Its Subsidiaries
Total Page:16
File Type:pdf, Size:1020Kb
Contents Message from the Chairman of the Board 3 Message from the President 5 TOT Information 7 Key Financial Information 8 Key Services Information 9 TOT Broadband Service for Thai Society 12 Important Services and Activities 14 Vision, Mission, and Corporate Objectives 16 Business Operation Business Conditions 17 Services Jointly Provided with Private Companies 23 Shareholdings in Other Companies and Joint 24 Venture Strategic and Annual Operation Plan 26 Future Project Plans 28 The Telecommunications Industry and Competition 30 Research and Development 34 Human Resource Management and Development 37 Organizational Structure 41 Board of Directors 42 Name of Top Executives 62 Commitment to Corporate Social Responsibility 74 Universal Basic Telecommunications 77 and Social Service Good Corporate Governance Policy 79 Internal Control 81 Inside Information 83 Risk Management 84 Adherence to the Official Information 85 Act, B.E. 2540 (1997) Management Discussion and Analysis 86 Connected Transactions 90 Report of the Audit Committee 94 Responsibilities of the Board of Directors in respect 96 to the financial statements Auditor’s Report 97 Financial Statements 98 Message from the Chairman of the Board According to the recovery of Thai Economy from the recent world economic slowdown and tremendous technology changes in telecommunication industry with fierce competitions, TOT Public Company Limited (TOT), as one of the leading telecommunication providers in Thailand, has to enhance its competitiveness together with aiming for a sustainable growth in order to keep its leading position in the industry. In 2010, TOT overall performance has improved compared to its performance in 2009 as the result of mobile phone and high speed internet services. Nonetheless, we, the board of directors, along with TOT executives still carry on our goal of moving TOT forwards and achieving a stability growth by improving its existing services to ensure customers confidence and satisfaction, offering high quality and innovative communication services to satisfy customer needs, and providing an excellence service and accessibility to customers in every part of Thailand. Our current projects are, for example, the Next Generation Network (NGN), broadband internet coverage expansion throughout the country, and 3G mobile network infrastructure construction. In 2011, telecommunication industry in Thailand is expected to grow continuously with high competitions because communications become an essential part of our life and technology allows communications to be just one click away. Therefore, TOT has a strong determination to drive our existing projects such as NGN, broadband internet, and 3G networks forward to enhance Thai people living quality. In addition, these projects are also corresponding to the National Broadband Policy which aims to increase the accessibility of information and bridge the digital divide between city and rural to achieve our final goal of “The learning-based society”. Moving forward and succeeding there objectives, TOT could not be successful without a strong collaboration from every part of our organization to become a Thailand leading telecommunication provider which has an important role move Thailand forward to a sustainable social and economic development. (Mr. Areepong Bhoocha-oom) Chairman TOT Public Company Limited 002 003 Message from the President Many external and internal factors affect business operation and corporate performance. In response to those key impacts, the Board of Directors has established policies in four key areas as follows: good corporate governance, revenue stimulation from new products and services, competitive benchmarking, and significant obligations and cost reduction. Based on these approaches, TOT has set a five-year strategic plan and a yearly operational plan. Overall performance of TOT in 2010 was able to sustain reasonable business growth. Total revenues amounted to 73,035 million baht and total expenses were 65,293 million baht. This resulted in net profit of 7,742 million baht; an increase of 17.3 percent over 2009. TOT was also able to expand its services to customers. For example, ADSL service was expanded to cover the whole country with more than 1.11 million ports, an increase of more than 163,000 ports over 2009. 3G service was provided to more than 150,000 numbers, and the new H.A.V.E. online game was successfully launched with its unique emphasis on non-violence and harmony among friends. In addition, the potential for service provision was enhanced by upgrading the existing network to the Next Generation Network (NGN) and by expanding high speed broadband using optic fibers (FTTx). These initiatives should be complete by 2014. Service has already commenced in Phuket, Koh Samui, Surat Thani, and industrial estates in the Eastern region. In support of the National Broadband Policy under the Wireless Road Project initiative, the government has set the target of providing economical Internet access to all people in all regions so that they will gain full benefit from the use of technology. TOT has piloted a project to provide wireless broadband service to sub- district areas in Nakornsithammarat, Trang and Pitsanulok. This service offers a low-cost, limited time package. Another significant objective in business transaction is a commitment to customer satisfaction at all stages of service. TOT launched a 24x7, All Day All Time project under the theme “Full service with whole heart” in over 410 customer service centers throughout the country. This project focuses on providing our customers with quick and comprehensive service. Certain risks may affect the future business operation of TOT. Firstly, policies relating to concession contracts are still awaiting clarification from the government policy as well as enforcement of the Act on Organization to Assign Radio Frequency and to Regulate the Broadcasting and Telecommunications Services B.E. 2553 (2010). The management of TOT has studied closely the details of these issues and has prepared plans for their implementation. Because of the participation and cooperation of all staff, TOT has been able to quickly complete its various projects and has brought about a significant increase in the level of customer satisfaction. I, as representative of TOT management, would like to take this opportunity to thank everyone involved and express our resolve to support all our operations in the future so that they are brought to successful completion. In this way, we will continue to be the main telecommunications service provider in Thailand. (Mr.Noppanat Hutacharoen) Acting President 004 005 TOT Information TOT Public Company Limited, hereinafter referred to as “TOT” or “the Company”, operated as the Telephone Organization of Thailand for 48 years before being transformed into TOT Public Company Limited on July 31, 2002 , under the State Enterprise Corporatisation Act B.E. 2542 (1999). Accordingly, all rights, entitlements, debts, obligations, assets, and staff formerly belonging to the Telephone Organization of Thailand were transferred to TOT Public Company Limited. TOT remains a state enterprise of which the Ministry of Finance is the sole shareholder. Short Forms: TOT / The Company Registered Number: 0107545000161 Head Office Location: 89/2 Moo 3 Chaengwattana Road, Thungsonghong, Laksi, Bangkok 10210, Thailand Type of Business: Provides telecommunications and other related services either directly or through joint ventures with other entities. Activities also include investment in other companies. Customer Relations Centre: telephone: 1100, +662 240 0701 Website: www.tot.co.th Issued and Paid-up Share Capital: 6,000 million baht (six thousand million baht) Share Type: 600 million common shares (six hundred million common shares), Par value 10 baht per share Reference: Auditor Office of the Auditor General of Thailand Office Rama VI Road, Phayathai, Bangkok 10400, Thailand Telephone 0 2273 9674-91 Facsimile 0 2618 5783 006 007 Key Financial Information Key Services Information Unit: Million Baht Million lines 7 Details 2010 2009 % Increase 6 5 Services 2010 2009 2008 (Decrease) 4 Financial Performance 6.38 6.58 6.66 2010 / 2009 3 2 1 1. Total Revenues * 51,439.8 49,805.5 0 Fixed line telephone 2010 2009 2008 2. Total Expenses * 43,677.1 42,818.5 Fixed line telephone Number of lines in service (Unit : line) 6,380,864 6,582,548 6,664,754 (3.06) Hundred thousand lines 3.5 3. Adjusted Items in Account - Concession Agreements - TOT (Metropolitan & Provincial) 3,770,460 3,776,873 3,712,391 (0.17) 3.0 - TRUE (Metropolitan) 1/ 1,707,444 1,739,353 1,786,613 (1.83) 2.5 21,595.7 21,202.7 1/ 2.0 3.1 Amortisation of deferred income - from concession agreements - TT&T (Provincial) 902,960 1,066,322 1,165,750 (15.32) 1.5 2.76 2.97 3.13 2/ 1.0 3.2 Depreciation - assets from concession agreements 17,272.7 17,950.2 Number of lines in service per 100 population 10.02 10.60 10.51 (5.47) 0.5 0.0 - Metropolitan 36.36 37.05 37.77 (1.85) 2010 2009 2008 4. Profit before Finance Costs and Income Tax - Provincial 5.71 6.01 6.10 (4.99) Payphone Million lines 35 (1 - 2 + 3.1 - 3.2) 12,085.7 10,239.5 30 Payphone 25 5. Finance Costs 475.3 810.3 Number of lines in service (Unit : line) 276,136 297,177 312,605 (7.08) 20 15 30.83 30.37 27.25 - TOT (Metropolitan & Provincial) 225,136 246,177 261,605 (8.55) 10 6. Income Tax 3,868.3 2,829.5 1/ 5 - TRUE (Metropolitan) 26,000 26,000 26,000 0.00 0 1/ 2010 2009 2008 7. Net Profit (4 - 5 - 6) 7,742.1 6,599.7 - TT&T (Provincial)