( ) Stark Corporation Public Company Limited

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( ) Stark Corporation Public Company Limited 20192019 รายงานประจำป 2562 บริษัท สตารค คอรเปอเรชั่น จำกัด (มหาชน) Stark Corporation Public Company Limited Message from the Chairman Stark Corporation Public Company Limited (“STARK”) is considered a newcomer to The Stock Exchange of Thailand in July, 2019 which a Holding company. The subsidiary company that STARK’s 99% holding is Phelps Dodge International (Thailand) Co., Ltd. (“PDITL”) and PDITL as a main business that drive STARK’s business successfully. PDITL is a leader in wire and cable market on Top Major in Thailand, PDITL also focus on quality and safety which is high quality product and globally recognized. PDITL has strong experience and driving long – term business more than 40 years ago and then STARK held shares and entered to the Stock Exchange of Thailand, It is worth keep every close an eye on the all investors. In the year 2019, despite the internal and external economic fluctuations every business has been affected by the economic downturn that caused some businesses to slow down. But STARK still continues to move the business forward with the acquisition of assets and connected transaction on acquisition and acceptance of entire business transfer in Adisorn Songkhla Co., Ltd. (“Adisorn”) which the key business operations of manpower services and engineering services that helps STARK strengthen to be even stronger. In the year 2020, around the world must face the situation of the spread of the virus Covid-19 since the beginning of the year, which aggravated the economy even more sluggish. But STARK Continue to develop all products and services to business expansion continuously. In March, 2020 the Company and its subsidiary company acquire shares in Thinh Phat Cables Joint Stock Company (“Thipha Cables”) and Dong Viet Non-Ferrous Metal And Plastic Joint Stock Company (“Dovina”) When PDITL combined with Thipha Cables and Dovina we are ASEAN's top manufacturer of wires and cables. Finally, on behalf of the board of the dire09xxxctors, executives and all employees, I would like to thank you and committed to our mission to maintain organization and create secure growth steadily sustainably for the future and will give pride and deliver sustainable value to all stakeholders with our vision “To be ultra-competitive in everything we do”. - Mr. Chanin Yensudchai - (Mr. Chanin Yensudchai) Chairman Stark Corporation Public Company Limited Contents page 1. Policy and Business Overview ....................................................................................................................... 1 2. Nature of Business ...................................................................................................................................... 12 3. Risk Factors ................................................................................................................................................. 46 4. Investment Properties .................................................................................................................................. 56 5. Labor Disputes ............................................................................................................................................. 66 6. General Information ..................................................................................................................................... 67 7. Management and Corporate Governance .................................................................................................. 70 8. Management Structure ................................................................................................................................ 76 9. Corporate Governance ................................................................................................................................ 85 10. Corporate Social Responsibility ................................................................................................................. 151 11. Internal Control and Risk Management ..................................................................................................... 161 12. Related Party Transactions ........................................................................................................................ 164 13. Financial Status and Performance ............................................................................................................ 195 14. Management Discussion and Analysis of Operating Results ................................................................... 212 15. Details related to Directors in Subsidiaries ............................................................................................... 247 16. Details of Asset Appraisal ......................................................................................................................... 248 Stark Corporation Public Company Limited Business Operation 1 Policy and Business Overview 1.1 Business Overview Stark Corporation Public Company Limited (“STARK” or “Company”) conducts business by means of a holding company and has a subsidiary operating the main business, namely Phelps Dodge International (Thailand) Limited (“PDITL”). PDITL was founded on June 4, 1968 and commenced the first production at Samrong Plant. At the beginning, PDITL was a joint-stock company between major electric wire manufacturing companies in Thailand and Phelps Dodge Group of the United States of America. With regard to Phelps Dodge Group of the United States of America, it conducts a major copper mine business in the United States of America and was founded in 1834 making a total period of more than 180 years. In 1987, PDITL jointly established a company named Thai Copper Rod Company Limited (“TCR”) in the proportion of 20.00 percent of the issued and fully paid ordinary shares. It is a joint-stock company between PDITL and other manufacturers and distributors of electric cable in Thailand. In this regard, TCR conducts a service business in casting and rolling copper wire for a group of electric wire manufacturers. In 2015, Phelps Dodge Group of the United States of America sold the investment abroad, and Team A Holding 2 Company Limited (“TAH2”), of which the main shareholder was Mr. Wanarat Tungkarawakun, bought the shares of PDITL in the proportion of 75.66 percent of the issued and fully paid ordinary shares at that time. In addition, the Board and all of the executives of PDITL were also changed to be Thai executives in such year. However, PDITL still kept their personnel with experience, knowledge and expertise in the electric wire business, and developed the existing and new personnel to be able to keep up with technology at all times. Nowadays, PDITL is the manufacturer and distributor of various kinds of electric wire for the world market by having a business network that connects with production bases and offices in several regions, including Asia, Africa, and etc. PDITL’s products are regarded as the most significant components in other industries, such as real estate, construction, petrochemical, as well as devices for communication, telecommunication, and etc. Additionally, the important previous projects, of which PDITL was the distributor and service provider, include Mahanakhon Building, Terminal 21 Korat, Ideo Q Sam Yan, BITEC 2, Assumption University Bang Na Campus, Electricity Sub-Station Project which is in cooperation with Provincial Electricity Authority, Electricity Sub-Station Project at Kolkata, India, and etc. 1.2 Vision, Mission and Operational Goal STARK has a goal for organizational development at present and in the future for continuous and sustainable success. In this regard, STARK foresees the competition which may increase inside and outside the country. Hence, STARK focuses on the research and development of products and services, personnel development to 1 Stark Corporation Public Company Limited be prepared for changes in the industry, as well as studying new products that can support the main business for sustainable growth. With regard to PDITL, it is the number 1 leader in electric wire and cable manufacturing technology that aims at placing importance on quality and safety which will lead to highly efficient products that are acceptable within Thailand and abroad around the world. Vision “To be ultra-competitive in everything we do” 1.3 Key Development of STARK STARK (formerly known as Siam Inter Multimedia Public Company Limited ( “SMM”) was established in 1990 with 1,000,000 baht of registered capital divided into 10,000 shares, each with a par value of 100 baht per share. In 2003, the Company converted into a public company. In 2005, the Company registered with Security Exchange of Thailand (“SET”) and it was approved an initial public offering (IPO) with 240,000,000 baht of registered capital divided into 240,000,000 shares, each with a par value of 1 baht per share. Thereafter, The Board of Directors’ Meeting of SMM No. 5/2018 on December 21, 2018 was resolved to grant approval regarding the Company’s business restructuring as follows: It was resolved to grant approval to propose the Shareholders’ Meeting to consider approving the Company’s business restructuring by way of partial business transfer, namely, book publishing, production of TV and radio programs, TV broadcast and satellite program licensing, and printing and other businesses of any form, including assets, liabilities only in respect of trade accounts receivable, any other unconditional loans from creditors or financial institutions and personnel relating
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