ANNUAL REPORT 2013 METRO PUBLIC COMPANY LIMITED

STEPPING STONE FOR A BETTER FUTURE

189 Rama IX Road, Huai Khwang, Bangkok 10310, Tel. + 66 (0) 2354-2000 Fax. + 66 (0) 2354-2040 www.bangkokmetro.co.th ANNUAL REPORT 2013 ANNUAL REPORT 2013 วิสัยทัศน์ เป็นหนึ่งในผู้ให้บริการรถไฟฟ้าขนส่งมวลชนชั้นน�ำของโลก ด้วยคุณภาพการบริการที่ประทับใจ

Vision To be one of the world leading mass operators with high quality of service.

ภารกิจ เราจะให้บริการขนส่งมวลชนด้วยรถไฟฟ้าที่มีความปลอดภัย สะดวก รวดเร็ว เชื่อถือได้ และตรงเวลา เพื่อบรรเทาปัญหาการ จราจร ช่วยรักษาสิ่งแวดล้อม และยกระดับคุณภาพชีวิตของ ประชาชน

Mission We will provide mass transit services to the public with the safe, convenient, fast, reliable, and punctual metro system to alleviate traffic congestion, maintain the environment and improve quality of life.

วัฒนธรรมองค์กร (Corporate Culture) BMCL STAR B : Business Acumen รอบรู้ธุรกิจ M : Morality สุจริตโปร่งใส C : Customer Oriented ใส่ใจบริการ L : Learning เชี่ยวชาญ เรียนรู้ S : Systematic Thinking ดูเหตุและผล T : Teamwork ทุกคนช่วยกัน A : Aspiration มุ่งมั่นเป้าหมาย R : Reliable เชื่อถือได้แน่นอน CONTENT

1 Business Policy and Overview 003 11 Risk Factors 069

2 Financial Highlights 008 12 Capital Structure 075 3 Message from the Chairman of the Board 13 Management Structure 077 of Directors 013 14 Corporate Governance 086 4 The Board of Directors and Management Team 015 15 Corporate Social Responsibility 106 5 Achievement Awards 027 16 Internal Control and Risk Management 108 6 Significant Activities in 2013 028 17 Audit Committee’s Report for 2013 110 7 Route Map of the Metro Service 043 18 Related Party Transactions 112 8 General Information and Other Significant Information 045 19 Management Discussion and Analysis of Financial Position and Results of Operations 118 9 Nature of Business 049 20 Report on Responsibilities of the Board 10 Mass Rapid Transit Master Plan of Directors towards the Financial Report 125 in Bangkok Metropolitan Region 066 21 Financial Statements and Report of the Auditor 126

1. Business Policy and Overview

Background The Company received the standard management Bangkok Metro Public Company Limited (the “Company”) certifications as follows: was established on 18 February 1998 to participate in the 1) ISO 9001:2008 Quality Management System; bidding for the concession of the first underground mass 2) ISO 14001:2004 Environmental Management System; rapid transit system project in Thailand, to carry out the design, 3) OHSAS 18001:2007 and TIS 18001:2001 Occupational manufacture, supply, installation, testing and commissioning Health and Safety Management Systems; of the M&E Equipment for the operation and maintenance 4) Safety Management System from Lloyd’s Register Rail. of the metro. The Company was granted the exclusive The MRT metro service operated by the Company is a concession for such project approved by the Council of modern, safe and eco-friendly mass rapid transit system. Ministers on 28 March 2000 and 25 July 2000, respectively. In this regard, the Company realises the significance of In addition, the Company was converted to a public limited sustainable development of the organisation to be one of company on 11 May 2004 and was listed on the Stock the world leading mass rapid transit operators with sustainability, Exchange of Thailand on 21 September 2006. by strengthening its competitiveness while striving to seek The Company is the first metro operator in Thailand, entrusted a balance among society, environment and economy. The by the Mass Rapid Transit Authority of Thailand (“MRTA”) Company signed to be a member of the Charter on Sustainable as the concessionaire in the operation and maintenance of Development, Pledge Signatory, of the International Association two MRT projects: of Public Transport (UITP) in June 2008, and was accepted as a member of the Charter on Sustainable Development, The M.R.T. Chaloem Ratchamongkhon Line Full Charter Signatory, in June 2009, whereby the Company’s (“”) (Hua Lamphong - Bang Sue) membership has been renewed for the third period (2012-2014), 20 kilometres, 18 stations PPP Net Cost (AOT) representing the determination in compliance with the On 1 August 2000, the Company entered into the Agreement contractual obligation to ensure the strategic policies in line for the MRTA Initial System Project - Chaloem Ratchamongkhon with the principles of the business operation to balance Line (“Blue Line”), Hua Lamphong - Bang Sue, with MRTA. among business, social and environmental growth, with The Company has the exclusive right to collect fares and internal systems for application, monitoring, following up and undertake activities and commercial development, including reporting of the performance under such guidelines. Moreover, advertising, leasing space in the project and telecommunications the Company has participated as a member of another two services in the stations and in the trains, for 25 years international federations, namely, American Public Transportation (2 July 2004 - 1 July 2029). The official commencement of Association (APTA) and NOVA Group of Metros, with the operations is on 3 July 2004. objectives to study and exchange the excellent practices with other international public transport operators, and The MRT Project, Bang Yai - Rat Burana, apply them as guidelines in the continued self-development Bang Yai - Bang Sue Section (Khlong Bang Phai and improvement. Station - Tao Poon Station) 22 kilometres, 16 stations PPP Gross Cost (ATO) Business Strategies The Company executed the Agreement for the MRT Purple To achieve the Company’s objectives and missions, the Line Project, Bang Yai - Rat Burana, Bang Yai - Bang Sue Company determines the key strategies for its business Section (Khlong Bang Phai Station - Tao Poon Station), operations in 2013 as follows: Contract 4, on 4 September 2013, for the Concession for 1. To constantly generate revenue, both fare revenue and Supply of M&E Systems and O&M Services (Khlong Bang commercial development revenue, with the following key Phai Station - Tao Poon Station), with MRTA, for 30 years strategies: (4 September 2013 - 3 September 2043). - To increase the number of passengers during off-peak

Annual Report 2013 Bangkok Metro Public Company Limited 3 hours on working days and holidays by setting up - To provide the competency management system. marketing campaigns for privileges to MRT cardholders, - To restructure work positions and career groups. new card issuance and Co-Brand business alliances. - To restructure wages and salaries as appropriate. - To increase commercial development revenue through - To administer the business with efficiency, transparency, the integrated proactive marketing, in association with equality and auditability, taking into account all groups Bangkok Metro Networks Limited. of stakeholders. 2. To manage cost and control expenses appropriately and - To develop the information technology system to efficiently: ensure analysis and report on results in support of - To promote energy-saving campaigns and enhance management’s decision-making in due course. the efficiency in energy management. - To manage the information technology service to - To control and determine measures to reduce electricity ensure efficiency, including information security, in consumption in retail shop areas, MRT operation and accordance with ISO/IEC 27001. maintenance. - To upgrade the asset management standard. - To manage and control fees for maintenance of 4. To create recognition and trust from all groups of stakeholders: systems, station and retail shop areas. - To maintain and improve the quality of impressive, - To manage the purchasing and procurement with safe, convenient, fast, reliable, punctual and quality rapidity and efficiency by promoting proactive services to meet standards concerning environmental purchasing, development of effectiveness of working impact in order to enhance the service users’ process and enhance the ability in response to satisfaction customers’ needs with appropriate purchasing - To build relationship with key stakeholders, that is, techniques service users, staff, and nearby communities, based on the corporate social responsibility, along with 3. To update management knowledge, particularly people communications on social responsibility in various management, performance management and project aspects conducted by the Company via public relations management: channels for public recognition.

Annual Report 2013 4 Bangkok Metro Public Company Limited - To provide knowledge on quality, safety and environment 1. Keep all possible risks associated with the operation of to staff, passengers, contractors and counterparties. the railway system as low as reasonably practicable and - To prevent and minimise impact on the environment/ comply with laws; working condition, and promote participation in 2. Ensure that all preventive and corrective measures environmental preservation activities of the Company. designed to minimize such risks are implemented efficiently - To promote the corporate image with a commitment and effectively, as well as developed and improved continually; to “Service Above All Else”. and - To create recognition and clarity of the Company’s 3. Raise safety knowledge and safety awareness among logo/name, BMCL brand positioning for communication all those involved. via appropriate channels Safety is everyone’s responsibility. It is imperative that all our employees do everything they can to maintain the highest standards of safety for the sake of our passengers, Quality Policy, Safety Policy, Environmental our contractors and our own personnel. Policy, Energy Saving Policy, Sustainable Development Policy, and Risk Management Environmental Policy Policy The Company has provided the mass transit railway service by holding in an environmentally responsible manner. Quality Policy Therefore, BMCL have developed Environmental Management The Company is committed to improving the quality of System (EMS) with continual improvement in order to avoid service as part of our goal to become one of the world and keep impacts to the environment at acceptable level. leading mass rapid transit operators. To succeed in the To meet these commitments, BMCL shall strive to: said vision, the Company pledges to develop and implement 1. Prevent and control the environmental pollutions generated quality management system in order to: from our business activities to minimize the environmental 1. Provide rail mass rapid transit service that satisfies impacts as low as reasonably practicable and comply customers’ expectations with safe, convenient, fast, with all applicable law and regulation; reliable and punctual metro system; 2. Ensure that all preventive and control measures designed 2. Continually improve quality of service and business are implemented, reviewed and continually improved as performance; and well as using resources efficiently throughout BMCL 3. Encourage employees to have the knowledge, competency operations; and commitment to their jobs needed to provide safety 3. Raise environmental knowledge and awareness among and quality service. all our employees, contractors and all concerned person The satisfaction of customers is essential for our business. to understand their responsibilities towards environmental Our entire staff is committed to improving quality so that we protection. can better serve our customers and enhance our overall The implementation and effectiveness of this environmental performance. policy is the responsibility of all BMCL employees and contractors to have a good quality environmental for customers, Safety Policy employees, contractors and communities. Safety is the heart of our mass transit railway service. To ensure the safety of our passengers, our contractors, and Energy Saving Policy our own personnel, we are committed to making continuous The Company provides mass transit railway services in an improvements in our safety management system in order energy efficient and responsible manner. In this regard, to: BMCL operates its Energy Management System proficiency

Annual Report 2013 Bangkok Metro Public Company Limited 5 with an aim towards continuous improvement. To meet these safety and business growth. The continued growth of the commitments, BMCL shall strive to: mass rapid transit business have always caused the Company’s 1. Control the energy consumption of its business activities external and internal factors to change. to be in line with the energy savings plan and objective The Company realises that the risk management process in order to bring an optimal benefit of energy consumption is an essential component which enables the Company to and comply with appropriate laws; foresee risks in various aspects, thereby resulting in its 2. Ensure that all preventive and control measures designed preparedness and appropriate and timely response to changes in the business conditions, including the opportunity are implemented, reviewed and continually improved as for sustainable growth. well as ensuring that resources are used efficiently; and The Board of Directors then determines the risk management 3. Present the energy knowledge and awareness among policy of the Company as follows: all our employees, contractors and all concerned parties 1. To provide the risk management process in accordance to make sure that they all understand their responsibilities with international standards or practices to ensure the towards the consumption of energy. efficiency of the risk management; enterprisewide operation This policy is an important part of BMCL’s operations and and development in the same direction as the business the responsibility of all BMCL employees and contractors operation policy of the Company. to implement as they are on the forefront for continuous 2. To treat the risk management as part of work, significant and sustainable energy savings. decision-making regarding management, strategic planning to achieve the specified objectives, goals, missions and Sustainable Development Policy vision of the Company. The Company is committed to operate mass rapid transit 3. To carry out the proactive risk management to manage services with particular emphasis on safety, society and the risks which may result in the Company’s loss of interests environment in order for BMCL’s sustainable business and opportunities. growth. As such, BMCL focuses its operational practices 4. To delegate the risk management as staff’s responsibility to be transparent and fair with the aim to benefit and grow at all levels and manage risks within their work units and together all groups of stakeholders in an appropriate manner. the organization to contain risks at adequate and appropriate Hence, BMCL has set an operating policy for sustainable level. development as follows: 5. To efficiently communicate the risk management within 1. To be a leading organisation in the sustainable development the Company for staff’s effective learning, development concept, through communication and exchange of best and compliance. practices with all of BMCL’s stakeholders; 2. To incorporate the sustainable development concept into Significant Developments in 2013 every aspect of BMCL; 4 September 2013 3. To promote training, learning and counselling, focusing on • The Company entered into the Agreement with the practices according to sustainable development guidelines; Mass Rapid Transit Authority of Thailand (MRTA) for 4. To support regional operation and cooperation to achieve the MRT Purple Line Project, Bang Yai – Rat Burana, sustainable development. Bang Yai – Bang Sue Section, Contract 4: Concession This policy is the responsibility of every employee to seriously for Supply of M&E Systems and O&M Services (Khlong implement and to harmoniously incorporate with his or her Bang Phai Station - Tao Poon Station), for a concession own operational processes for the sustainable growth of period of 30 years from the date of execution of the BMCL and all its groups of stakeholders. Agreement, with a total value of Baht 82,625 million (including value added tax), approved by the Council of Ministers on 3 September 2013. Risk Management Policy • The Company entered into the Agreement for The Company is the mass rapid transit service provider in Engagement of CH. Karnchang Public Company the MRT system, a large-scale project, which faces the Limited as Project Manager, as well as for Supply and challenges in terms of investment, revenue, service with

Annual Report 2013 6 Bangkok Metro Public Company Limited Installation of M&E Systems in the MRT Purple Line 1. For additional procurement of the M&E Systems in order Project, Bang Yai - Rat Burana, Bang Yai - Bang Sue to upgrade and enhance the efficiency of the service and Section, Contract 4: Concession for Supply of M&E operation under the Concession Agreement, and for the Systems and O&M Services (Khlong Bang Phai Station Company’s general business activities; - Tao Poon Station), with a total value of Baht 20,011 2. For repayment of the principal and accrued interest of million (including finance cost but exclusive of value the loan from the shareholder, namely, CH. Karnchang added tax). Public Company Limited; 3. For repayment of accrued interest of the loans from the 11 November 2013 financial institutions. The Extraordinary General Meeting of Shareholders No. 1/2013 of the Company passed a resolution granting approval During the period from 9 to 16 December 2013, the Company to increase the Company’s registered capital from Baht offered a total of 6,275.70 million ordinary shares to the 11,950,000,000 to Baht 20,500,000,000 by issuing existing shareholders of the Company, totalling Baht 6,275.70 8,550,000,000 new ordinary shares for offering to existing million. On 24 December 2013, the Company offered a shareholders in proportion to their shareholding percentage total of 2,274.30 million ordinary shares to private placement (Right Offering), with the subscription ratio of 1.3977 existing investors, namely, four lending financial institutions, totalling ordinary share to 1 new ordinary share, at the price of Baht Baht 2,274.30 million. The Company completed the registration 1/each. In addition, the Executive Committee or the person of its capital increase on 25 December 2013 and the Company’s assigned by the Executive Committee shall have the power 8,550 million capital increase ordinary shares were traded to allocate any remainder of shares to Private Placement on the Stock Exchange of Thailand from 27 December 2013. subscriber(s). The objectives of this capital increase are as follows: Such registered and paid-up capital increase changes in the Company’s shareholding structure as follows:

As at 19 November 2013 As at 13 January 2014 (Before Capital Increase) (After Capital Increase) List of Shareholders Number of shares Number of shares % % (Million shares) (Million shares) 1. CH. Karnchang Public Company Limited 1,988.3 16.64 6,188.3 30.19 2. Mass Rapid Transit Authority of Thailand 2,987.5 25.00 2,987.5 14.57 3. Bangkok Expressway Public Company Limited 1,195.1 10.00 2,050.1 10.00 4. Hicrete Products & Technology Co., Ltd. 1,304.9 10.92 1,810.5 8.83 5. Krung Thai Bank Public Company Limited 471.3 3.94 1,697.4 8.28 6. TMB Bank Public Company Limited - - 661.6 3.23 7. Bank of Ayudhya Public Company Limited - - 516.9 2.52 8. UOB Kay Hian (Hong Kong) Limited - Client A/C 423.3 3.54 474.2 2.31 9. Syntec Construction Public Company Limited 367.8 3.08 242.7 1.18 10. Thanachart Bank Public Company Limited - - 206.7 1.01 11. Mr. Wichit Chinwongworakul 116.1 0.97 133.6 0.65 12. Hi-Steel Products Company Limited 162.4 1.36 122.7 0.60 13. Nomura Securities Co.,Ltd 100.0 0.84 100.0 0.49 Total 9,116.7 76.29 17,192.2 83.86 Registered Capital 11,950.0 100.0 20,500.0 100.0

Annual Report 2013 Bangkok Metro Public Company Limited 7 2. FINANCIAL HIGHLIGHTS

Consolidated Financial Statements Bangkok Metro Public Company Limited and its Subsidiary

Unit: million Baht Financial Position (as at 31 December) 2013 2012 2011 Total Assets 20,359 18,318 18,480 Total Liabilities 11,603 17,347 16,530 Paid-up Capital 20,500 11,950 11,950 Total Shareholders’ Equity 8,756 971 1,950 Operating Performance (For the year ended 31 December) 2013 2012 2011 Fare Box Revenue 2,106 1,979 1,646 Commercial Development Revenue 422 291 254 Total Revenue 2,537 2,281 1,903 Costs of Fare Box 1,316 1,369 1,309 EBITDA 837 554 259 Net Profit (Loss) /1 (774) (979) (1,154) Net Profit (Loss) per share (Baht) (0.06) (0.08) (0.10) Financial Ratios 2013 2012 2011 EBITDA Margin (%) 33.00 24.27 13.64 Net Profit Margin (%) (30) (43) (61) Debt to Equity Ratio (times) 1.33 17.87 8.48 Fare box Ratio /2 (times) 1.60 1.45 1.26

Remarks: /1 Profit (Loss) attributable to equity holders of the Company /2 Fare Box Ratio: Fare Box Revenue/Costs of Fare Box

Annual Report 2013 8 Bangkok Metro Public Company Limited Million Baht Growth Rate Total Revenue (2008 - 2013) 2,800 Growth Rate 25 2,600 Total Revenue 20% 20 2,400 2,537 2,281 2,200 15 1,903

2,000 11% 9% 9% 10 1,800 1,750 1,687 7%

1,600 1,579 5 4% 2,537 1,400 0 Total Revenue 2013 1,200 11% Growth Rate 2008 2009 2010 2011 2012 2013

Million Baht Growth Rate Fare box Revenue (2008 - 2013) Growth Rate 2,400 Fare Box Revenue 25

2,200 20% 20 2,106

2,000 1,979 15

1,800 1,646 6% 8% 8%

1,525 10 1,477 2,106 1,600 7% 1,400 1,375 5 Fare Box Revenue 2013 3% 1,200 0

6% Growth Rate 2008 2009 2010 2011 2012 2013

Million Baht Growth Rate Commercial Development Revenue (2008-2013) 450 50 422 45% 400 45 40 350 35

300 291 30

254 25 250 225

210 20 204 16% 15%

200 13% 15

422 Commercial 7% 10

150 3% Development Revenue 2013 5 100 0 2008 2009 2010 2011 2012 2013

Growth Rate Growth Rate 45% Commercial Development Revenue

EBITDA และ EBITDA MARGIN (%) Million Baht 1,000 40% 33% 2008 - 2013 837 800 30% 24%

600 554 20%

400 14% 259 10% 6% 200 106 0% 837 0 2008 2009 2010 2011 2012 2013 EBITDA 2013 -200 -10% -8% -139 -400 -20%

-234 EBITDA MARGIN % -15% 33% EBITDA MARGIN EBITDA

Annual Report 2013 Bangkok Metro Public Company Limited 9 Fare Box Ratio (2008 - 2013)

Times 2.0 1.60

1.5 1.45

1.60 1.26 Times 1.16 0.99 Fare Box 1.0 0.95 Ratio 2013 0.5

2008 2009 2010 2011 2012 2013

Average Trips per working day (2008-2013)

Trips : Day 194,230 202,428 210,873 220,552 252,826 272,009 290,000 270,000 272,009 250,000 2013 230,000 2008 210,000 194,230 190,000 170,000 150,000 2008 2009 2010 2011 2012 2013

Average Trips per day (2008-2013)

Trips : Day 250,000 169,813 174,657 181,870 189,310 220,225 236,811 240,000 230,000 220,000 210,000 2013 236,811 200,000 169,813 190,000 2008 180,000 170,000 160,000 150,000 2008 2009 2010 2011 2012 2013

Annual Report 2013 10 Bangkok Metro Public Company Limited Ridership (Highest and Lowest Trips in 2012 and 2013)

Highest Trips in 2012 Highest Trips in 2013 1. 29 June 2012 (314,406 trips) 1. 28 June 2013 (334,721 trips) - 16th Saha Group Export - 17th Saha Group Fair at QSNCC at QSNCC 2. 30 March 2012 (308,125 trips) 2. 7 November 2013 (329,138 trips) - 40th National Book Fair - Commart Comtech Thailand 2013 at QSNCC at QSNCC and ; - the political rally around Asoke - Sukhumvit Intersection 3. 16 November 2012 (302,694 trips) 3. 6 September 2013 (326,100 trips) - Commart Comtech Thailand 2012 - Thai Teaw Thai 2013 at QSNCC at QSNCC

Lowest Trips in 2012 Lowest Trips in 2013 1. 16 April 2012 (73,521 trips) 1. 16 April 2013 (75,415 trips) - Long Holidays: Songkran Festival - Long Holidays: Songkran Festival 2. 2 January 2012 (80,525 trips) 2. 1 January 2013 (83,480 trips) - Long Holidays: New Year’s Day - Long Holidays: New Year’s Day 3. 1 January 2012 (83,677 trips) 3. 14 April 2013 (94,103 trips) - Long Holidays: New Year’s Day - Long Holidays: Songkran Festival

Annual Report 2013 Bangkok Metro Public Company Limited 11

3. MESSAGE FROM THE CHAIRMAN OF THE BOARD OF DIRECTORS

2013 marks the year of progress and pride for Bangkok Metro Public Company Limited, with outstanding developments in terms of operational results, financial strength and business expansion. The results of operations showed an exceptional growth in fare revenue and commercial development revenue. Our fare revenue increased 6.42% while commercial development revenue rose sharply up to 45.05% from 2012, resulting in EBITDA of Baht 837.32 million, representing a growth rate of 51.24%, and EBIT of Baht 465.84 million. With respect to our financial strength, the Extraordinary General strategic policies in line with the balanced performance in terms of Meeting of Shareholders No. 1/2013 on 11 November 2013 resolved economic, social and environmental growth; and adopt systems to to approve the Company’s registered capital increase from Baht apply, monitor and report on performance in compliance with the 11,950 million to Baht 20,500 million by way of issuance of new guidelines. In 2013, the Company received the Best Corporate Social 8,550 million ordinary shares, at the par value of Baht 1 per share. Responsibility Award - Best CSR Award, from the Stock Exchange Shareholders and financial institutions enthusiastically welcomed the of Thailand (SET Awards) in recognition of our corporate social Company’s new share offering, and as a result, all of our new shares responsibility in business operations (CSR-in-Process). Such award have been fully subscribed. As such, the Company’s capital base is our pride once again after the IR Excellence Awards 2008 for the is now appropriate and adequate for future operations. In addition, remarkable listed company in Investor Relations activities. such capital increase has also decreased the Company’s debt to equity ratio from 17.87 times to 1.33 times, reflecting our stronger The political rally in many areas of Bangkok since 2013 until the investment capital. present may affect Thailand’s economic outlook, with an economic expansion rate of merely 2.9% last year, lower than 4.5 - 5.5% In 2013, we have also achieved a key milestone in business expansion projected by the Office of the National Economic and Social by signing the Agreement for the MRT Purple Line Project, Bang Yai Development Board in late 2012. However, such political rally turns - Rat Burana, Bang Yai - Bang Sue Section, Contract 4: Concession out to be a positive factor for the Company. Given the traffic closures for Supply of M&E Systems and O&M Services (Khlong Bang Phai on various roads, people’s travelling by personal cars or public bus Station - Tao Poon Station) with the Mass Rapid Transit Authority service became impossible. The mass rapid transit rail system is of Thailand (MRTA) on 4 September 2013, for a concession period the only service available for people’s convenient commute to many of 30 years from the date of execution of the Agreement, worth Baht areas during such period, and as such, the number of passengers is 82,625 million (including value added tax). As a result, we become skyrocketing above 20 percent, with a new high at 365,000 trips per the only mass rapid transit operator in Thailand which manages both day. Other than the political factor, oil prices continue to rise, coupled underground and elevated rail projects. The MRT Purple Line Project with the fast-growing real estate development projects along the MRT will help not only increase our revenue significantly, but also feed routes, and the creative advertising media and materials with more passengers to our current MRT project. The PPP Gross Cost outstanding appearances, we are certain that our operating results scheme in the MRT Purple Line Project will also help minimise our in 2014 will achieve a phenomenal growth relative to our preceding risk of fare revenue uncertainty. years.

Our MRT service is one of the state-of-the-art, safe and eco-friendly Lastly, the Board of Directors and I would like to thank shareholders, mass rapid transit rail systems. We find it necessary to develop our passengers, financial institutions, government agencies, management organisation in order to become one of the world’s leading and and all staff, as well as other parties concerned, who play an important sustainable mass rapid transit operators, keeping balance among part in pushing our business and operations forward. I am confident social, environmental and economic aspects, as well as our that our next step will bring about a steady and sustainable growth responsibility to all stakeholders. The Company’s membership of to accommodate the expansion of various metro projects awarded the Charter on Sustainable Development, as a Full Charter Signatory, to the Company for operation and maintenance services, as well as of the International Association of Public Transport (UITP) represents other potential mass rapid transit rail projects in the future. our commitment to compliance with the undertaking to implement

(Mr. Plew Trivisvavet) Chairman of the Board of Directors

Annual Report 2013 14 Bangkok Metro Public Company Limited 4. The Board of Directors and Management Team

The Board of Directors ( As at December 31, 2013)

Mr. Plew Trivisvavet • Chairman of the Board of Directors • Chairman of the Executive Committee • Nomination and Remuneration Committee Member • Authorized Signatory Director • Age 68 years Education Qualification • M.Sc. (Electrical Engineering), Osaka University, Japan • B.Sc. (Electrical Engineering), Osaka University, Japan • National Defence Course, Class 366 • Directors Certification Program (DCP), Class 50/2004 • Directors Accreditation Program (DAP), Class 18/2004 • Finance for Non-Finance Directors Program (FND), Class 13/2004 Thai Institute of Directors Association • Capital Market Academy Leadership Program, Capital Market Academy (CMA Course), Class 4/2007 Work Experience 2011 - Present Director, CK Power Public Company Limited. 2010 - Present Director, Xayaburi Power Company Limited 2007 - Present Corporate Governance and Risk Management Committee Member, CH. Karnchang Public Company Limited 2006 - Present Director and Chairman of the Executive Board Nam Ngum 2 Power Co., Ltd. 2006 - Present Director, Thai Tap Water Supply Public Company Limited 2004 - Present Chairman of the Board of Directors, Chairman of the Executive Committee, and Nomination and Remuneration Committee Member Bangkok Metro Public Company Limited 2004 - Present Director, Energy Limited 2002 - Present Director and Chairman of the Executive Board Bangkok Expressway Public Company Limited 1996 - Present Director, Northern Bangkok Expressway Company Limited 1994 - Present Chairman of the Executive Board and Chief Executive Officer, CH. Karnchang Public Company Limited

Annual Report 2013 Bangkok Metro Public Company Limited 15 Mr. Supong Chayutsahakij General Chetta Thanajaro • Vice Chairman of the Board of Directors • Independent Director • Executive Committee Member • Chairman of the Audit Committee • Authorized Signatory Director • Chairman of the Nomination and Remuneration Committee • Age 72 years • Age 75 years

Education Qualification Education Qualification • Honorable Doctorate of Business Administration (Management), • Master of Arts (Political Science), Ramkhamhaeng University Rajabhat Phranakorn University • Bachelor of Science, Chulachomklao Royal Military Academy, Class 9 • Master of Business Administration (Management), Sasin Graduate • Infantry Basic Officer Leadership Course Institute of Business Administration of United States Army Infantry School • Master of Political Science (Politics and Government), Sukhothai Thammathirat Open University • The Royal Thai Army Command and General Staff Course • Bachelor and Master of Engineering (Electrical), • The Joint State-Private Sector Regular Course University of Tokyo, Japan National Defence College, Class 6 • Directors Certification Program (DCP), • Directors Certification Program (DCP), Class 33/2003 Class 8/2001 • Finance for Non-Finance Directors Program (FND), Class 7/2003 • Audit Committee Program, Class 17/2007 • Board & CEO Assessment, Class 2/2003 Thai Institute of Directors Association Thai Institute of Directors Association Work Experience Work Experience 2011 - Present Director, CK Power Public Company Limited 2005 - Present Director, Chairman of the Audit Committee, and Chairman 2009 - Present Vice Chairman of the Board of Directors Bangkok Metro Public Company Limited of the Nomination and Remuneration Committee 2009 - Present Chairman of the Board of Directors Bangkok Metro Public Company Limited Bangkok Metro Networks Limited 2005 - Present Director, Double A (1991) Public Company Limited 2008 - Present Director, Nam Ngum 2 Power Co., Ltd. 2005 - Present Chairman of the Audit Committee 2008 - Present Director, SouthEast Asia Energy Limited L.P.N. Platemill Public Company Limited 2006 - Present Chairman of the Institute 1996 - Present President Advisor, The Royal Development Project Thai-Nichi Institute of Technology 2004 Minister of Defence 2006 - Present Independent Director and Audit Committee Member 2003 - 2004 Minister of Science and Technology Siam Steel International Public Company Limited 1999 - 2003 Audit Committee Member 2004 - Present Executive Committee Member Bangkok Expressway Public Company Limited Bangkok Metro Public Company Limited 2003 - Present Director and Vice Chairman of the Executive Board Bangkok Expressway Public Company Limited 1996 - Present Director and Executive Committee Member Northern Bangkok Expressway Company Limited 2004 - 2009 Director, Bangkok Metro Public Company Limited 1994 - 2003 Managing Director Bangkok Expressway Public Company Limited

Annual Report 2013 16 Bangkok Metro Public Company Limited Mr. Vitoon Tejatussanasoontorn Lieutenant General Surat Sumrith • Independent Director • Independent Director • Audit Committee Member • Audit Committee Member • Nomination and Remuneration Committee Member • Age 64 years • Age 73 years

Education Qualification Education Qualification • Bachelor of Commerce, Thammasat University • Military Science (Special Class), Chulachomklao Royal Military Academy • Directors Certification Program (DCP), Class 2/2000 • The Military Cadet Program, Engineer School • IOD Chartered Director (CDC), Class 1/2007 • Audit Committee Program, Class 27/2009 • The Colonels Program, Engineer School • Advanced Audit Committee Programs (AACP), Class 3/2010 • Bachelor of Industrial Trade • Role of Compensation Committee (RCC), Class 12/2011 • Air Command and Staff College, Class 30 Thai Institute of Directors Association • Joint Staff College, Class 35 • National Defence College, 2004 • Directors Accreditation Program (DAP), Class 40/2005 • Finance for Non-Finance Directors Program (FND), Class 25/2006 Work Experience Thai Institute of Directors Association 2007 - Present Chairman of the Corporate Governance and Risk Management Committee, Nomination and Remuneration Committee Member Work Experience CH. Karnchang Public Company Limited 2005 - Present Director and Audit Committee Member 2005 - Present Director, Audit Committee Member, Bangkok Metro Public Company Limited Nomination and Remuneration Committee Member 2004 - 2009 Special Expert of the Office of the Permanent Bangkok Metro Public Company Limited Secretary for Defence 2005 - Present Advisor, Asahi Automotive (Thailand) Co., Ltd. Office of the Permanent Secretary for Defence 2004 - Present Director, Asahi Glass Foundation of Thailand 2002 - Present Advisor, The Federation of Thai Industries, 2003 - 2004 Advisor of the Office of the Permanent Secretary for Samutprakan Province Defence (Lieutenant General) 2001 - Present Vice President, Samutprakan Chamber of Commerce Office of the Permanent Secretary for Defence 1999 - Present Director and Chairman of the Audit Committee CH. Karnchang Public Company Limited 1991 - Present Senior Executive Vice President AGC Flat Glass (Thailand) Public Company Limited 1988 - Present Director and Executive Director Kiarti Thanee Country Club Co., Ltd. 1987 - Present Director, Diachrome Chemicals Co., Ltd. 1986 - Present Director and Executive Director Sakata-Thai Corporation Company Limited

Annual Report 2013 Bangkok Metro Public Company Limited 17 Mrs. Vallapa Assakul Dr. Sombat Kitjalaksana • Independent Director • Director • Chairman of the Risk Committee • Vice Chairman of the Executive Committee • Age 64 years • Authorized Signatory Director • Age 57 years

Education Qualification Education Qualification • Master of Economics, University of Detroit, U.S.A. • Dr. Techn. in Soil Mechanic, University of Innsbruck, Austria • Bachelor of Economics (Second Class Honors), Chulalongkorn University • Bachelor and Master of Engineering (Civil), Chulalongkorn University • Audit Committee Program (ACP), Class 21/2008 • Directors Certification Program (DCP), Class 81/2006 • Directors Certification Program (DCP), Class 86/2007 • Finance for Non-Finance Directors Program (FND), Class 19/2005 • Directors Accreditation Program (DAP), Class 37/2005 • Directors Accreditation Program (DAP), Class 36/2005 • Role of the Compensation Committee (RCC), Class 5/2008 Thai Institute of Directors Association Thai Institute of Directors Association Work Experience Work Experience 2013 - Present Director, Ocean Property Co., Ltd. 2011 - Present Vice Chairman of the Executive Committee 2013 - Present Director, Thanapum Estate Co., Ltd. Bangkok Metro Public Company Limited 2012 - Present Director, Vinythai Public Company Limited 2009 - Present Director, Bangkok Metro Networks Limited 2012 - Present Chairman of the Risk Committee 2006 - Present Director, CH. Karnchang Public Company Limited Bangkok Metro Public Company Limited 2004 - Present Director, Bangkok Metro Public Company Limited 2010 - Present Director, Siam Estate Co., Ltd. 2000 - Present Director and Executive Director 2010 - Present Director and Executive Director Bangkok Expressway Public Company Limited Thai Tap Water Supply Public Company Limited 2010 - Present Director and Executive Director 2004 - 2011 Executive Committee Member Northern Bangkok Expressway Company Limited Bangkok Metro Public Company Limited 2009 - Present Independent Director 2001 - 2010 Executive Vice President Bangkok Metro Public Company Limited CH. Karnchang Public Company Limited 2009 - Present Risk Committee Member 2000 - 2011 Managing Director, Bangkok Metro Public Company Limited Ocean Life Insurance Company Limited 2008 - Present Director, Amphan Co., Ltd. 2008 - Present Vice Chairman of the Governance and Audit Committee Ocean Life Insurance Company Limited 2006 - Present Director, Ocean Life Insurance Company Limited 2006 - Present Chairman of the Nomination and Remuneration Committee Ocean Life Insurance Company Limited

Annual Report 2013 18 Bangkok Metro Public Company Limited Mrs. Kritaya Sumitanant Miss Dachanee Euarchukiat • Director • Director • Age 59 years • Age 55 years

Education Qualification Education Qualification • Master of Public and Private Management, • Master of Science, International Banking & Financial Studies, National Institute of Development Administration Southampton University, UK • Bachelor of Accounting, Thammasat University • Bachelor of Science, Economics (Honours), • Directors Accreditation Program (DAP), Class 97/2012 London Metropolitan University, UK Thai Institute of Directors Association • Directors Accreditation Program (DAP), Class 97/2012 Thai Institute of Directors Association

Work Experience Work Experience 2012 - Present Director, Bangkok Metro Public Company Limited 2012 - Present Director, Bangkok Metro Public Company Limited 2011 - Present Deputy Governor (Administration) 2012 - Present Subcommittee Member Mass Rapid Transit Authority of Thailand Mass Rapid Transit Authority of Thailand 2008 - 2011 Assistant Governor 2005 - 2007 Vice President, Credit Risk Policy Department Mass Rapid Transit Authority of Thailand Risk Management Group, TMB Bank Public Company 2004 - 2008 Director of General Administration Department Limited Mass Rapid Transit Authority of Thailand 2004 Consultant - Investment International Finance Corporation (World Bank) 1985 - 2002 Local Product Management Wholesale Banking Group, Standard Chartered Bank, Thailand Branch and Standard Chartered Nakornthon Bank

Annual Report 2013 Bangkok Metro Public Company Limited 19 Mr. Werapong Suppasedsak Mr. Chaiwat Utaiwan • Director • Director • Age 47 years • Executive Committee Member • Risk Committee Member • President • Authorized Signatory Director • Age 60 years Education Qualification Education Qualification • Master of Economics (Financial Economics), • Master of Business Administration (Executive), Sasin Graduate Institute of Business Administration of Chulalongkorn University National Institute of Development Administration • Master of Science (Mathematics and Computer Science), University of • Bachelor of International Economics, Ramkhamhaeng University Louisville, Kentucky, U.S.A. • Directors Accreditation Program (DAP), Class 100/2013 • Bachelor of Science in Statistics, Faculty of Commerce and Thai Institute of Directors Association Accountancy, Chulalongkorn University • The Joint State-Private Sector Regular Course, Class 20, National Defence College, National Defence Studies Institute • Role of the Chairman Program (RCP), Class 29/2012 Work Experience • Directors Certification Program (DCP), Class 18/2002 2012 - Present Director, Bangkok Metro Public Company Limited Thai Institute of Directors Association 2011 - Present Director • Capital Market Academy Leadership Program (CMA), Class 3/2006 Capital Market Academy Krungthai-AXA Life Insurance Public Company Limited • Public Director Certification Program (PDI), Class 12, Public Director 2011 - Present Executive Vice President - Director Institute, King Prajadhipok’s Institute Krung Thai Bank Public Company Limited • Top Executive Program in Commerce and Trade (TEPCoT), Class 6, 2010 - 2011 Senior Vice President - Director Commerce Academy, University of the Thai Chamber of Commerce • Poom Palung Pandin Course for Top Executive, Class 1, Krung Thai Bank Public Company Limited Chulalongkorn University 2005 - 2010 First Vice President and Manager Krung Thai Bank Public Company Limited Work Experience 2012 - Present Vice Chairman of the Board of Directors Bangkok Metro Networks Limited 2011 - Present Chairman of the Board of Directors Hotel Company Limited 2011 - Present Director, Executive Committee Member, Risk Committee Member, President, and Acting Executive Vice President, Management Group Bangkok Metro Public Company Limited 2011 - 2012 Director, Bangkok Metro Networks Limited 2011 - 2012 Director and Executive Director Government Savings Bank 2007 - 2011 President and Chief Executive Officer Siam City Bank Public Company Limited 2001 - 2007 Chairman of the Executive Board and President AIG Retail Bank Public Company Limited 2001 - 2007 President and Chief Executive Officer AIG Finance (Thailand) Public Company Limited

Annual Report 2013 20 Bangkok Metro Public Company Limited Management Team ( As at December 31, 2013)

Mr. Chaiwat Utaiwan • Director • Executive Committee Member • Risk Committee Member • President • Authorized Signatory Director • Acting Executive Vice President, Management Group • Age 60 years

Education Qualification • Master of Business Administration (Executive), Sasin Graduate Institute of Business Administration of Chulalongkorn University • Master of Science (Mathematics and Computer Science), University of Louisville, Kentucky, U.S.A. • Bachelor of Science in Statistics, Faculty of Commerce and Accountancy, Chulalongkorn University • The Joint State-Private Sector Regular Course, Class 20, National Defence College, National Defence Studies Institute • Role of the Chairman Program (RCP), Class 29/2012 • Directors Certification Program (DCP), Class 18/2002 Thai Institute of Directors Association • Capital Market Academy Leadership Program (CMA), Class 3/2006 Capital Market Academy • Public Director Certification Program (PDI), Class 12, Public Director Institute, King Prajadhipok’s Institute • Top Executive Program in Commerce and Trade (TEPCoT), Class 6, Commerce Academy, University of the Thai Chamber of Commerce • Poom Palung Pandin Course for Top Executive, Class 1, Chulalongkorn University

Work Experience 2012 - Present Vice Chairman of the Board of Directors Bangkok Metro Networks Limited 2011 - Present Chairman of the Board of Directors Suvarnabhumi Airport Hotel Company Limited 2011 - Present Director, Executive Committee Member, Risk Committee Member, President, and Acting Executive Vice President, Management Group Bangkok Metro Public Company Limited 2011 - 2012 Director, Bangkok Metro Networks Limited 2011 - 2012 Director and Executive Director Government Savings Bank 2007 - 2011 President and Chief Executive Officer Siam City Bank Public Company Limited 2001 - 2007 Chairman of the Executive Board and President AIG Retail Bank Public Company Limited 2001 - 2007 President and Chief Executive Officer AIG Finance (Thailand) Public Company Limited

Annual Report 2013 Bangkok Metro Public Company Limited 21 Mr. Witoon Hatairatana Mr. Visuit Boreriboon • Risk Committee Member • Risk Committee Member • Executive Vice President, • Executive Vice President, Operations Group Marketing Group • Age: 56 years • Age: 51 years

Education Qualification Education Qualification • Master of Science (Business Administration), • Master of Public and Private Management, California University of Pennsylvania, U.S.A. National Institute of Development Administration • Bachelor of Engineering (Civil), Chulalongkorn University • Bachelor of Economics (Finance and Banking), Ramkhamhaeng University Work Experience 2012 - Present Executive Vice President, Operations Group Bangkok Metro Public Company Limited Work Experience 2007 - 2012 Acting Marketing & Commercial Development Director Bangkok Metro Public Company Limited 2012 - Present Risk Committee Member, and Executive Vice 2005 - Present Risk Committee Member President, Marketing Group Bangkok Metro Public Company Limited Bangkok Metro Public Company Limited 2004 - 2012 Operations Director, Bangkok Metro Public Company Limited 2011 - 2012 Senior Executive Vice President 2002 - 2004 Traffic Manager, Bangkok Metro Public Company Limited Thanachart Bank Public Company Limited 2000 - 2002 Managing Director, Gear Banterng Co., Ltd. 2003 - 2011 Senior General Manager Siam City Bank Public Company Limited Miss Veena Tachachainirun • Risk Committee Member • Executive Vice President, Finance Group • Age: 48 years

Education Qualification • Master of Business Administration (International Program), Bangkok University • Bachelor of Accounting, Thammasat University Work Experience 2012 - Present Risk Committee Member, and Executive Vice 2007 - 2011 Senior General Manager President, Finance Group Siam City Bank Public Company Limited Bangkok Metro Public Company Limited 2003 - 2007 General Manager, Siam City Bank Public Company 2011 - 2012 Senior Executive Vice President Limited Thanachart Bank Public Company Limited

Annual Report 2013 22 Bangkok Metro Public Company Limited Mr. Chartchai Praditpong Mr. Ritwibool Jayakom • Senior Vice President, • Vice President, Public Relations and Train Operations Corporate Affairs

Mr. Lakthan Thongnopakoon Mrs. Tanawon Srivardhana • Vice President, • Vice President, Engineering and Administration and Maintenance Information Technology

Ms. Sutida Sangprueksa Mr. Sombat Trivisvavet • Vice President, • Vice President, Office of the President Business Development

Mr. Anawash Suwanarit Mrs. Pongprach Ramyarupa • Vice President, • Vice President, Project Management Marketing and Services Development

Mrs. Wannee Lorterapong • Vice President Accounting and Finance

Annual Report 2013 Bangkok Metro Public Company Limited 23 1. Mrs.Piyanoot Tantipanichpant Deputy Traffic Manager 2. Mr.Sompon Aroonloes Deputy Traffic Manager 3. Mr.Nattha Thongchat Control Manager 4. Mr.Chaiyawat Junphong Stations Manager 5 9 7 3 6 10 4 2 5. Mr.Teerayutt Puwasawat Train Crew Manager 8 1 6. Mr.Bhuwanai Sriwetchanan Deputy Train Crew Manager 7. Mr.Piyawat Chanatipnopachai Deputy Stations Manager 8. Ms.Sopit Niyompiyapote Deputy Stations Manager 9. Mr.Samphan Jongutsah Deputy Stations Manager 10. Mr.Aditta Sensathien Deputy Stations Manager

Annual Report 2013 24 Bangkok Metro Public Company Limited 1. Mr.Pichit Rukchonlatee Engineering & Maintenance Manager 2. Mr.Prawit Impornrugee Operations Performance Manager 3 2 4 1 5 6 3. Mr.Kitipat Supakleelakul Deputy Engineering & Maintenance Manager 4. Mr.Phusit Arnmanee Deputy Operations Support Manager 5. Mr.Prayuth Janjareansuk Acting Engineering & Maintenance Planning Manager 6. Mr.Pornsak Kruttakul Acting M&E Engineering & Maintenance Manager

Annual Report 2013 Bangkok Metro Public Company Limited 25 1. Mr.Pracha Udomchaiporn Senior Information Technology Manager 2. Mr.Chatchaporn Triwimol Safety & Quality Manager 7 3 3. Mr.Peera Chaisuvan Administration & 8 6 4 9 5 10 2 Procurement Manager 1 4. Mrs.Narumol Krungthongchan Marketing Manager 5. Ms.Nareerut Nunchasiri Services Development Manager 6. Mrs.Siriporn Yeesoonthet Public Relations Manager 7. Mr.Nat Charuchinda Deputy Administration & Procurement Manager 8. Mrs.Duangkhae Thawornwong Deputy Administration & Procurement Manager 9. Mr.Pongtorn Rattanakonravit Deputy Information Technology Manager 10. Mrs.Itthaporn Limchaikul Officer, Office of the Internal Audit

Annual Report 2013 26 Bangkok Metro Public Company Limited 5. Achievement Awards

Best CSR Awards

AGM Assessment: Excellent Rating BMCL was rated “Excellent” in the assessment of the 2013 Annual Ordinary General Meeting of Shareholders (AGM) continuously since 2007 to date from the Annual Ordinary General Meeting of Shareholders (AGM) Assessment Campaign organized by the Thai Investors Association.

CG Scoring 2013 – Very Good Rating

BMCL was rated “Very Good” in the assessment of the 2013 Corporate Governance Scoring. BMCL was rated “Very Good” in the assessment of the 2013 Corporate Governance Scoring. The current scoring criteria are BMCL was granted three awards in respect of corporate social responsibility, based on the good corporate governance principles of the namely, Best Corporate Social Responsibility Awards (CSR Awards) and Organisation for Economic Cooperation and Development (OECD Outstanding Corporate Social Responsibility, organised by the Stock Principles of Corporate Governance), comprising 5 main categories, Exchange of Thailand, and CSRI Recognition Awards, organised by the i.e., Rights of Shareholders, Equitable Treatment of Shareholders, Corporate Social Responsibility Institute. Roles of Stakeholders, Disclosure and Transparency, and Board These awards signify the recognition of BMCL’s corporate social responsi- Responsibilities. The 2013 Corporate Governance Scoring was bility and commitment to integration of CSR in process for listed companies organised by the Thai Institute of Directors Association (IOD). with market capitalisation of Baht 2,000 - 10,000 million.

Outstanding Award 2013 for Safety, Occupational Health and Work Environment

BMCL received the National Outstanding Award 2013 for Safety, Occupational Health and Work Environment from the Department of Labour Protection and Welfare.

Annual Report 2013 Bangkok Metro Public Company Limited 27 6. Significant Activities in 2013

Significant Activities

Signing Ceremony of the Concession Agreement for Supply of M&E Systems and O&M Services (Khlong Bang Phai Station - Tao Poon Station), Contract 4 (Khlong Bang Phai Station - Tao Poon Station) On 4 September 2013, BMCL signed the Concession Agreement for Supply of M&E Systems and O&M Services (Khlong Bang Phai Station - Tao Poon Station) in the MRT Purple Line Project, Bang Yai – Rat Burana, Bang Yai – Bang Sue Section, with the Mass Rapid Transit Authority of Thailand at Conference Room 2, 9th Floor, Office Building of MRTA.

Signing Ceremony of the Agreement for Project Management, as well as for Supply and Installation of M&E Systems in the MRT Purple Line Project, Bang Yai – Rat Burana, Bang Yai – Bang Sue Section, Contract 4 (Engineering, Procurement, and Construction Contract : EPC) On 4 September 2013, BMCL signed the Agreement for Project Management, as well as for Supply and Installation of M&E Systems in the MRT Purple Line Project, Bang Yai - Rat Burana, Bang Yai - Bang Sue Section, Contract 4: Concession for Supply of M&E Systems and O&M Services (Khlong Bang Phai Station - Tao Poon Station), with CH. Karnchang Public Company Limited at Administration Building of Bangkok Metro Public Company Limited.

BMCL Participated in SKY Walk Inauguration On 10 August 2013, BMCL participated in the inauguration of “Mother’s Day Book Fair @ Airport Link” in honour of Her Majesty the Queen on the occasion of National Mother’s Day. Meanwhile, H.E. Kittiratt Na-Ranong, Deputy Prime Minister and Minister of Finance inaugurated the 166-metre Sky Walk, which connects Phetchaburi Station with , Station, hosted by Mr. Yongsit Rojsrikul, Governor of the Mass Rapid Transit Authority of Thailand.

Annual Report 2013 28 Bangkok Metro Public Company Limited Investor Relations Activities CEO Agenda Mr. Chaiwat Utaiwan, the President, gave an interview in “CEO Agenda” programme, on the subject of his vision for business outlook in the next three years and preparations for AEC, which was on the air on Saturday, 26 January 2013, on BangkokBiz TV Channel.

Money Talk On 19 March 2013, Mr. Chaiwat Utaiwan, the President, gave an interview in “Money Talk Weekly” programme, co-hosted by Dr. Paiboon Seriwiwattana, Dr. Nivet Hemwachirawarakorn, Mr. Tavon Chotechuen and Mr. Saneh Srisuwan, which was on the air on Saturday, 30 March 2013, during 10:00-11:00 p.m. on Money Channel True Visions 14 and local cable TV subscriptions nationwide.

Economic Journal On Tuesday, 9 April 2013, Mr. Chaiwat Utaiwan, the President, gave an interview in “Economic Journal” programme, which was on the air on 15-16 April 2013 during 2:00 - 3:00 p.m. on Spring News TV Channel, hosted by Khun Napha Sornprasit, an economic editor, for “Baht 2 Trillion Loan Bill for Transportation Infrastructure, the MRT Blue Line Extension and the MRT Purple Line Agreement”.

Company Visit 2013 BMCL gave a warm welcome to a group of shareholders in two Company Visits. Company Visit No. 1 was held on 20 and 28 March 2013, with a presentation on BMCL’s results of operations and Q&As, as well as visiting the Operation Control Center (OCC). Company Visit No. 2 was held on 30 October 2013, with a presentation on BMCL’s results of operations and capital increase mechanism, as well as Q&As on policies of BMCL’s Management Team and visiting the “Metro Nine” in Phra Ram 9 Station, with its grand opening on 28 November 2013.

Analyst Meetings BMCL held Securities Analysts Meeting No. 1/2013 on Thursday, 25 April 2013, at Silom Station, to provide information relating to its business and operations, as well as visiting the route of the MRT Purple Line Project and Yaek 1 Station. Securities Analysts Meeting No. 2/2013 was held on Thursday, 31 October 2013, at Administration Building of Bangkok Metro Public Company Limited, to explain on the results of operations and business direction, as well as visiting the “Metro Nine” in Phra Ram 9 Station.

Annual Report 2013 Bangkok Metro Public Company Limited 29 The Extraordinary General Meeting of Shareholders No. 1/2013

BMCL convened the Extraordinary General Meeting of Shareholders No. 1/2013 on Monday, 11 November 2013, at 2:00 p.m. at Plenary Hall 3, Queen Sirikit National Convention Centre, in which the shareholders’ meeting resolved to grant approval for execution of four significant transactions, as follows: 1. Approval was granted to increase the Company’s registered capital from Baht 11,950,000,000 to Baht 20,500,000,000 by way of issuance of new 8,550,000,000 ordinary shares at the par value of Baht 1 per share (One Baht). 2. Approval was granted to amend Clause 4. of the Company’s Memorandum of Association in accordance with the increase of the Company’s registered capital. 3. Approval was granted to allocate 8,550,000,000 ordinary shares for capital increase for Right Offering. 4. Approval was granted to waive the requirement to make a tender offer for all securities for CH. Karnchang Public Company Limited; and approval was granted to authorize the Executive Committee of the Company or its delegates to have power to make various arrangements relating to the registered capital increase, allocation of capital increase ordinary shares and waiver from making a tender offer for all securities of the Company.

Annual Report 2013 30 Bangkok Metro Public Company Limited Marketing and Commercial Development Activities BMCL organised various marketing and commercial development activities, namely, CRM, value added activities to attract more ridership and retain its customer base, including provision of information on activities surrounding the MRT routes and campaigns and promotions for commute by the metro.

New MRT Card • Collection of the 9th Anniversary Souvenir MRT Cards 2,999 limited edition collection of the 9th anniversary souvenir MRT cards were issued in nine designs from nine landmarks along the MRT line on the special celebration of the 9th anniversary of the Chaloem Ratchamongkhon Line (MRT) services in July 2013.

• MRT Mini Cards New Baht 200 MRT Mini Cards, available in two designs, were released from 3 December 2013.

New Public Relations Media

• Installation of Public Relations Media within MRT stations BMCL has introduced new public relations media to attract target customers and to boost its commercial development revenue. New public relations media on benches and on handrails within MRT stations.

• Advertising Media on Platform Screen Doors (PSDs) Public relations media on Platform Screen Doors in 18 MRT stations.

Annual Report 2013 Bangkok Metro Public Company Limited 31 • Digital Media Digital Media is installed in four MRT stations, namely, Phra Ram 9 Station, Silom Station, Huai Khwang Station, and Queen Sirikit National Convention Centre, expected to complete in all 18 MRT stations by the first half of 2014.

• Bangkok MRT Mobile Application “Bangkok MRT” is an Application to facilitate passengers’ convenient journey and planning. Fare rates and facilities within MRT stations are available in the App, including search features for restaurants and tourist attractions along the MRT route, as well as other privileges exclusively for MRT customers.

Opening of Metro Nine in Phra Ram 9 Station and M Shop

• Opening of Metro Nine in Phra Ram 9 Station The Company has opened new retail shop area in Phra Ram 9 Station, called “Metro Nine”, a prototype retail model for other MRT stations, with more than 32 retail shops open since 18 October 2013.

• M Shop @ Metronine M Shop offers for sale MRT souvenirs, such as, M Train pillows, teddy bears in MRT staff uniforms, and M Train key chains, etc., as the first pilot MRT souvenir shop, including a redemption counter and service center for marketing activities, open Monday - Friday during 10:00 a.m. - 7:00 p.m.

Annual Report 2013 32 Bangkok Metro Public Company Limited Marketing Promotion in collaboration with Business Partners

• Baht 30 Discount Coupons for New MRT Cards Passengers may use discount coupons from various events, co-sponsored by BMCL, such as, Commart Next Gen 2013 during 20-23 June 2013 and Saha Group Fair No. 17 during 27-30 June 2013, etc., to issue a Baht 150 MRT card at any MRT station.

• Joint Program with Central Plaza Grand Rama 9 BMCL, in collaboration with Central Plaza Grand Rama 9, provided year-round privileges to MRT card holders and MRT CLUB members, and promoted their journeys by the MRT service to Central Plaza Grand Rama 9.

• Joint Program with Robinson BMCL, in collaboration with Robinson, provided year-round privileges to MRT card holders and MRT CLUB members, and promoted their journeys by the MRT service.

• Travelling Aun Jai by MRT with Safety BMCL and AIS jointly offered Baht 15 discount for 12,000 AIS customers each month with a minimum Metro Card purchase or top-up of Baht 300 on Friday, Saturday and Sunday, from 1 January to 31 December 2013.

• KTC Forever Reward KTC cardholders may redeem their KTC reward points to top up their stored value cards or issue new MRT cards from 1 January - 31 December 2013.

• Stored Value Cards at Special Price of Baht 180 During 1 April - 15 May 2013, the Company ran a campaign to offer stored value cards at a special price of Baht 180 to promote new MRT card issues, and to attract more customers to use the MRT service. The campaign was given a good reception from passengers, and then extended until 30 June 2013.

Annual Report 2013 Bangkok Metro Public Company Limited 33 Customer Relationship Management (CRM)

• Celebration on the 9th Anniversary of MRT Operations, Walk Together with MRT To celebrate the 9th anniversary of MRT operations, BMCL organised the “MRT 9th Anniversary Lucky Draw” activity to promote recognition and attract more passengers and MRT cardholders. All types of DAY Pass purchases or MRT card top-ups were given lucky draw coupons during 1 August - 30 September 2013.

• The 5th Getting Fit Beat GAT by MRT This activity was organised for MRT CLUB members who signed up for GAT tuition in an English language course by Teacher Somsri and a course by Teacher Lilly on 12 August 2013 at the Queen Sirikit National Convention Centre.

• Joint Activities with The Six Sense Season 2 on Thai TV Channel 3 BMCL, in collaboration with Thai TV Channel 3, installed Display Mockups in MRT stations to promote The Six Sense Season 2. Lead actors and actresses jointly took photographs with fan clubs and MRT passengers in MRT stations. Thirty lucky MRT CLUB members were selected to join activities in The Six Sense Society Season 2 with lead actors and actresses on 18 October 2013.

• Joint Marketing Campaign in “Luerd Khattiya the Musical” with SCENARIO The Company launched a marketing campaign for MRT customers and MRT CLUB members for free tickets to watch Luerd Khattiya the Musical. Each 30 DAY Pass purchase would be entitled to one coupon to redeem a free ticket to watch the musical, starting from 17 December 2013, at M Shop within Metro Nine. MRT CLUB members could also sign up for ticket lucky draws. • “M Stamp Collection” Marketing Promotion MRT card issues and top-ups with a minimum of Baht 300 would receive one M stamp. Every Baht 100 value of shopping in Metro Nine would also receive one M shopping stamp. Passengers may use these stamps to redeem a selection of souvenirs from M Shop. This is to promote MRT card issues and top-ups, and shopping within Metro Nine.

Relationship with the Press

BMCL has continuously organised activities to strengthen good relationships with the press, including press Conferrence to clarify company’s information as well as visitting the company’s Operations Control Center and providing a journey on the MRT system. Annual Report 2013 34 Bangkok Metro Public Company Limited Safety Activities The Company gives top priority to safety of our service users, contractors and staff. Safety is the heart of the mass rapid transit service. Last year, the Company organised safety activities as follows:

Emergency Drill BMCL organised the 2013 annual emergency drill, both internal and in association with external agencies, e.g., the Mass Rapid Transit Authority of Thailand (MRTA), the Bangkok Fire & Rescue Department (BFRD), Bangkok Emergency Medical Service, and hospitals along the metro routes, local police stations, and contractors. The emergency drill is conducted every year to make sure that our staff and the external agencies have proper skills and understanding to handle the situations, and to promote mutual understanding of work procedures of each agency, which will enhance the efficient coordination and cooperation to cope with various situations in the future.

Work Safety Promotion

BMCL regularly organises the work safety promotion activity through “5S Activity” to build up safety awareness for staff, by organising the Big Cleaning Day with active participation from our internal work units and main contractors in the MRT system. The Company promotes our staff and contractors to understand work safety by means of communications in various forms, namely, safety journals titled “PLOD ONLINE”; Intranet communications; and E-Magazine for contractors. In addition, the Company organised the Hitz Channel activity for the second year in a row during lunch break, as a public address programme on news and safety, quality and environmental activities, as well as inviting contractors to share their work experience in order for BMCL’s staff and contractors to realise the significance of work safety and to encourage work performance in compliance with the applicable work rules and regulations.

Annual Report 2013 Bangkok Metro Public Company Limited 35 The 2nd MRT Safety Plan Contest BMCL, in association with the Engineering Institute of Thailand under H.M. the King’s Patronage (EIT), and Safety and Health At Work Promotion Association (Thailand) (SHAWPAT), organised an MRT Safety Plan contest on the theme “Risk Assessment and Safety Measures against Fire Incidents in the MRT System” to promote undergraduates’ and students’ recognition and understanding in the safety process of the MRT system. The contestants were third-year or higher undergraduates from the Faculty of Engineering, the Faculty of Public Health or the Faculty of Occupational Health and Safety, totaling 13 teams from 7 universities. Six finalists were selected to present their plans in the final round on 23 November 2013 at Metro Mall, Station. The winner was the team from the Faculty of Public Health, Thammasart University.

Annual Report 2013 36 Bangkok Metro Public Company Limited Social and Environmental Activities • MRTA – BMCL Traditional Golf Tournament No. 1/2013 To promote and strengthen our good relationship with the Mass Rapid Transit Authority of Thailand (MRTA), the MRTA – BMCL Traditional Golf Tournament No. 1/2013 was organised on 26 January 2013.

• Free Journeys on the MRT System on the National Children’s Day To enhance the journey experience on the occasion of the National Children’s Day 2013 on Saturday, 12 January 2013, BMCL provided free journeys on the MRT system for children not taller than 140 centimetres throughout the service hours from 6:00 a.m. - 12:00 p.m.

• Inauguration of Pilot Project on Facilities and Services for People with Disabilities BMCL, in association with the Mass Rapid Transit Authority of Thailand (MRTA), welcomed Mr. Chadchart Sittipunt, the Minister of Transport, in the inauguration of a pilot project on facilities and services for people with disabilities at Lat Phrao Station on 4 April 2013.

• SAVE ENERGY WE ALL CAN DO To support the government’s policy on energy saving, which fell on the 60+Earth Hour 2013 Day on 23 March 2013 to campaign for public recognition, BMCL then launched a Save Energy We All Can Do campaign for use of stairs instead of descending escalators for three months from 1 April - 30 June 2013. Passengers may choose to use normal stairs or other designated escalators. BMCL uses all the electricity charges saved from this energy saving campaign in its corporate social responsibility (CSR) activities.

• Activities on the National Elderly Day and the Family Day: 3-Day Free Journeys on the “MRT System” for the Elders and Bathing Rite for Buddha Images at MRT Stations on Songkran Day To promote the values and significant role of the elders on the occasion of the National Elderly Day 2013, BMCL offered free journeys on the MRT system for the elders at age 60 years or over for 3 days during 13-15 April 2013 throughout the service hours from 6:00 a.m. - 12:00 p.m. BMCL also made arrangements for MRT passengers to pay homepage to and perform a bathing rite for Buddha images on the occasion of the Songkran Day 2013 during 10-15 April 2013 at 9:00 a.m. - 7:00 p.m. in nine MRT stations, namely, Hua Lamphong Station, Silom Station, Sukhumvit Station, Phra Ram 9 Station, Thailand Cultural Centre Station, Lat Phrao Station, Phahon Yothin Station, Chatuchak Park Station, and Bang Sue Station. Annual Report 2013 Bangkok Metro Public Company Limited 37 • Blessing and Allegiance to the Royal Institution Management and staff brought a Thai traditional flower bouquet to pledge allegiance to His Majesty the King and Her Majesty the Queen at 100th Year Siriraj Centennial Hall, Siriraj Hospital, on 10 July 2013.

• Recreational and Luncheon Activities at Bangkhae Home Foundation 2 on the MRT’s 9th Anniversary Management and staff jointly promoted voluntary spirit for the society in the vicinity of the MRT Blue Line Extension Project (Hua Lamphong - Bang Khae) through recreational and luncheon activities with elders, and also provided necessary items and supplies to Bangkhae Home Foundation 2 on 13 July 2013.

• Celebration of the National Mother’s Day 2013 with MRT Two activities on this occasions are: Free Journeys for Mothers on the MRT System: BMCL provided free journeys for mothers on the occasion of the National Mother’s Day on 12 August 2013 throughout the service hours from 6:00 a.m. - 12:00 p.m.

Mass Sports Project in Honour of Her Majesty the Queen The 21st “N.C.C. - TTM Mini Marathon Chalerm Phrakiart 2013” was organised on 12 August 2013 at the Queen Sirikit National Conventional Centre and the Benjakitti Park by N.C.C. Management & Development Co., Ltd. (NCC), representing our contribution to social and charitable activity in honour of Her Majesty Queen Sirikit on the occasion of her birthday on 12 August 2013.

• “Bicycle Rally with MRT for Energy Saving and Environmental Preservation” BMCL, in association with the Mass Rapid Transit Authority of Thailand (MRTA), sponsored the “Bicycle Rally with MRT for Energy Saving and Environmental Preservation” activity on the occasion of the 21st anniversary of foundation on 18 August 2013.

Annual Report 2013 38 Bangkok Metro Public Company Limited • Joint Hosting of Funeral Ceremony of “Somdej Phra Bhuddhacharn (Kiaw Uppaseno)” Bangkok Metro Public Company Limited, the MRT operator, led by Mr. Chaiwat Utaiwan, President, in association with Bangkok Metro Networks Limited (BMN), by Mrs. Thipsuda Yimwilai, Managing Director, along with management and staff, co-hosted a funeral chanting ceremony of “Somdej Phra Buddhacharn (Kiaw Uppaseno)” at Wat Saket Ratcha Wora Maha Wihan on 30 August 2013.

• Mini Marathon for Charity 2013 BMCL participated in the “Central Retail Mini Marathon 2013” programme to support the contributions to the fund in aid of persons affected by the unrest in the southern border provinces, as well as supporting Thai people’s health care, in front of CentralWorld on 29 September 2013.

• BMCL Invites Elders to Pay Homage to Buddha Images with MRT BMCL invited a group of elders from Bangkhae Home Foundation 2 to jointly make merits, pay homage to Buddha images and visit the Yaowarat Chinatown Heritage Center at The Golden Buddha Temple, as well as learning and travelling by the MRT system, including recreational activities at Silom Station on 11 October 2013.

• Thailand Engineering Expo 2013 BMCL, in association with CH. Karnchang Public Company Limited, together with another five CH. Karnchang group companies, comprising 1. Bangkok Expressway Public Company Limited, 2. Thai Tap Water Supply Public Company Limited, 3. SouthEast Asia Energy Limited, 4. Xayaburi Power Company Limited, and 5. CK Power Public Company Limited, participated in booth displays in Thailand Engineering Expo 2013: Synergy Bonding. BMCL’s booth presented the MRT service of the M.R.T. Chaloem Ratchamongkhon Line and the MRT Purple Line in the future. BMCL also participated in the “Success Factors and 9 Years of Experience from the M.R.T. Chaloem Ratchamongkhon Line” dialogue in Thailand Engineering Expo 2013, to promote its technology specialization for the operation of the M.R.T. Chaloem Ratchamongkhon Line (Hua Lamphong - Bang Sue) and the MRT Purple Line (Bang Yai - Bang Sue Section), to facilitate comfort and convenience to the society and service users, at IMPACT Challenger 3, IMPACT Arena, Exhibition & Convention Center, , during 14-17 November 2013.

Annual Report 2013 Bangkok Metro Public Company Limited 39 • Kathina Robe Offering On 17 November 2013, BMCL co-hosted a Kathina Robe Offering at Wat Noi Nok, , a temple near the MRT Purple Line Project (Bang Yai - Bang Sue Section), in order to jointly contribute funds for restoration of the 233-year-old Buddhist sanctuary, and support Buddhism, as well as granting 18 scholarships to underprivileged students with good academic records in Dhammasirisuksa School. The ceremony was given a big reception from local people, resulting in a total donation of Baht 1,099,000.

• “Off-Season Robe Offering to Build a Chanting Hall” Somdej Phra Buddha Chinnawong, the Abbot of Wat Phichaiyatikaram Worawiharn, presided over the ceremony, at Wat Chai Yo Worawiharn, Ang Thong Province, on 24 November 2013.

• Happy Father’s Day 2013 with Free MRT Journeys BMCL provided free journeys for fathers on the MRT system on the occasion of the National Father’s Day on 5 December 2013 throughout the service hours from 6:00 a.m. - 12:00 p.m.

Annual Report 2013 40 Bangkok Metro Public Company Limited Return the Metro Cards for Environmental Protection and Sustainable Social Development Project

For the seventh year, BMCL has maintained its commitment to environmental protection, together with social development with sustainability, to fully satisfy communities’ economic, social and environmental requirements through a variety of social contribution activities, along with environment protection. To this end, BMCL organized the “Return the Metro Cards for Environmental Protection and Sustainable Social Development” project to invite the MRT passengers to return their expired cards. BMCL would donate Baht 10 per card for development of the quality of life in communities, in terms of education, public health and others as appropriate through activities in response to needs and livelihood of communities, such as, the Share 2 Child activity for youths to learn the use of the MRT service for sightseeing at various places; and the M Care activity, in association with its alliances, in order to provide information on public health for passengers and people, including corporate social responsibility activities in other special occasions. This project signifies the concerted efforts of all MRT users and BMCL to create and push forward with the development of the quality of life in society, together with environmental protection, to ensure a better quality of life for everyone in society with a bright future for our next generations through sustainable development and growth. In 2013, BMCL used monies from this project to organise activities for development of the quality of life in terms of education and public health of communities surrounding the MRT routes, i.e., the existing MRT Blue Line Project, the MRT Purple Line Project, and the MRT Blue Line Extension Project, to be operated by BMCL in the future, totaling 9 activities, classified into three aspects, as follows: • Activity for Development of Quality of Life on Education BMCL brought students from schools along the MRT routes to go sightseeing for outdoor experience and join the Wichit Monthien Dramatic Art Contest at the King Rama II Commemorate Day Fair (King Rama II Memorial Park). On this occasion, BMCL also organised a “Lucky Eggs” booth to raise funds for contribution to the King Rama II Foundation Praboromrachanusorn under Royal Patronage.

• Activity on the MRT’s 9th Anniversary BMCL granted scholarships to underprivileged students and youths in Ang Thong Province and Bangkok. The MRT passengers jointly made donations in all 18 MRT stations during 15 January - 9 June 2013.

Annual Report 2013 Bangkok Metro Public Company Limited 41 • Share 2 child Activity BMCL granted scholarships and learning equipment and promoted learning experience for students, such as, the “Dream Sharing Project”, at Wat Wangkul School, Suphan Buri Province, from pre-elementary to elementary school students (Grade 6), and the “Fine Arts Project” (Silp Nam Nueang) in association with CH. Karnchang group, by providing necessary items and supplies to schools in need. • Activity for Development of Quality of Life on Public Health BMCL, in association with its partners, organised the M Care activity under the Return the Metro Cards for Environmental Protection and Sustainable Social Development Project at Phra Ram 9 Station, Phetchaburi Station and Sam Yan Station, to provide information on health care, health check-up and safe journey for passengers and people at the MRT stations.

• M Care Activity in association with Kluaynamthai Hospital BMCL organised the activity to provide knowledge relating to safe journey, including free health check-up, skin fold measurements, together with food nutrition knowledge by Thai Heart Foundation under Royal Patronage, lung function test, health threats of smoking by Thai Health Promotion Foundation (THPF), to passengers and general public at Sukhumvit Station. Company Visits

Throughout 2013, various groups and external agencies from both public and private sectors, in Thailand and abroad, attended the Company Visits on the business operations and the MRT service of Bangkok Metro Public Company Limited. All year round, there were a total of 5,955 visitors from 113 agencies, most notably were: Mr. Akihiro Ota, the Minister of Land, Infrastructure, Transport and Tourism of Japan, together with his team and staff from Japan International Cooperation Agency (JICA), for study visit in the MRT service at Bang Sue Station on 12 September 2013, with a reception hosted by Mr. Yongsit Rojsrikul, Governor of the MRTA, and Mr. Chaiwat Utaiwan, President of Bangkok Metro Public Company Limited and our management.

Annual Report 2013 42 Bangkok Metro Public Company Limited 7. Route Map of the Metro Service

At present, the Company is a concessionaire for two MRT Projects, as follows: The M.R.T. Chaloem Ratchamongkhon Line (Blue Line), Hua Lamphong - Queen Sirikit National Convention Centre - Bang Sue, with a total distance of 20 kilometres, 18 stations, is currently operated with a total of 19 trains in service every day without holiday from 6.00 hours - 24.00 hours; and the MRT Purple Line (Khlong Bang Phai - Tao Poon), with a total distance of 22 kilometres, 16 stations, is under construction and expected to be opened for service by 2016.

Annual Report 2013 Bangkok Metro Public Company Limited 43

8. General Information and Other Significant Information

8.1 Company Profile Bangkok Metro Public Company Limited Company Registration No. : 0107547000451 (previously 0107574700459) Head Office (As registered at Ministry of Commerce) : 189 Rama IX Road, Huai Khwang Subdistrict, , Bangkok 10310 Tel. : 66 (0) 2354 2000 Fax : 66 (0) 2354 2040 Branch Office (1) : 189/1 Rama IX Road, Huai Khwang Subdistrict, Huai Khwang District, Bangkok 10310 Branch Office (2) : 189/2 Rama IX Road, Huai Khwang Subdistrict, Huai Khwang District, Bangkok 10310 Customer Relations Center Tel. : 66 (0) 2624 5200 E-mail : [email protected] Investor Relations Tel. : 66 (0) 2354 2000 ext. 3513 - 3516 Fax : 66 (0) 2354 2000 ext. 3518 E-mail : [email protected] Audit Committee : Shareholders or stakeholders may contact or submit complaints on any matters which may cause damage to the Company at E-mail : [email protected] Website : http://www.bangkokmetro.co.th Type of Business : Mass Rapid Transit System Operator Concessionaire of the M.R.T. Chaloem Ratchamongkhon Line Project (Blue Line) (Hua Lamphong - Bang Sue), and the MRT Purple Line Project (Khlong Bang Phai - Tao Poon) Registered Capital : Baht 20,500 million, divided into 20,500 million ordinary shares, at the par value of Baht 1 per share Issued and Paid-up Capital : Baht 20,500 million, divided into 20,500 million ordinary shares, at the par value of Baht 1 per share Investors may refer to further details in the Annual Registration Statement (Form 56-1) of the Company on www.sec.or.th or the Company’s website.

Annual Report 2013 Bangkok Metro Public Company Limited 45 8.2 The Company’s Investment in the Subsidiary as at 31 December 2013

Bangkok Metro Networks Limited

Head Office : 587 Viriyathavorn Building, 12th Floor, Sutthisarnvinitchai Road, Dindaeng Subdistrict, Dindaeng District, Bangkok 10400 Branch Office : 587 Viriyathavorn Building, 9th Floor, Sutthisarnvinitchai Road, Dindaeng Subdistrict, Dindaeng District, Bangkok 10400 Tel. : 66 (0) 2275-4559, 66 (0) 2690-8200, 66 (0) 2690 8391-4 Fax : 66 (0) 2690-8212, 66 (0) 2275 4314, 66 (0) 2690 8395 Website : http://www.bmn-mrt.com Type of Business 1. Leasing of retail space for shops in the stations and in the park and ride facility at Lat Phrao Station; 2. Procurement of advertisement boards and/or media in the trains and stations; 3. Rendering services and maintenance of telecommunications system equipment in the stations; 4. Administration of advertisement media via the Passenger Information Display (PIDs) in the trains and stations. Registered Capital : Baht 254 million, divided into 25.4 million ordinary shares, at the par value of Baht 10 per share Issued and Paid-up Capital : Baht 254 million, divided into 25.4 million ordinary shares, at the par value of Baht 10 per share Company Shareholding Number of Shares : 16,558,560 shares Percentage : 65.19 %

Note: Bangkok Metro Networks Limited was incorporated on 25 February 2009 through the amalgamation of three Subsidiaries, namely, Triads Networks Co., Ltd., Metro Mall Development Limited and BMCL Network Limited.

Annual Report 2013 46 Bangkok Metro Public Company Limited 8.3 Reference

Securities Registrar : Thailand Securities Depository Company Limited 62 The Stock Exchange of Thailand Building 4th Floor, Ratchadapisek Road, Klongtoey, Bangkok 10110 Tel.: 66 (0) 2229-2800 Fax: 66 (0) 2359-1259 TSD Call Center: 66 (0) 2229-2888 E-mail: [email protected] Website: http://www.tsd.co.th

Auditors : Ernst & Young Office Limited 33rd Floor, Lake Rajada Office Complex 193/136-137 New Rajadapisek Road Klongtoey, Bangkok 10110 Tel.: 66 (0) 2264 0777, Fax: 66 (0) 2264 0789-90

Legal Advisor : The Legists Ltd. 9th Floor, 990 Abdulrahim Place, Rama IV Road, Silom, Bangrak, Bangkok 10500 Tel.: 66 (0) 2636 1111, Fax: 66 (0) 2636 0000

Financial Institutions : Krung Thai Bank Public Company Limited TMB Bank Public Company Limited Bank of Ayudhya Public Company Limited Thanachart Bank Public Company Limited

Annual Report 2013 Bangkok Metro Public Company Limited 47

9. Nature of Business

Bangkok Metro Public Company Limited (the “Company”) was granted the concession by the Mass Rapid Transit Authority of Thailand (MRTA) for the MRTA Initial System Project - Chaloem Ratchamongkhon Line. The Company has the exclusive right to operate the train, collect fares and undertake commercial development, for a period of 25 years from 2 July 2004, which was the date MRTA issued the Notice of No Objection to commencement of revenue service. The Company is obliged to make payment of remuneration from fares and commercial development to the MRTA at the rates as mentioned in the Concession Agreement. The M.R.T. Chaloem Ratchamongkhon Line (“MRT metro”), covering a distance of 20 kilometres, with 18 stations, is rates in force have been adjusted on 3 July 2012, which will an underground metro project throughout the route, with 11 be in force until 2 July 2014. locations of space and the park and ride buildings, and connections with other feeders, e.g., connections with the Revenue from Commercial Development Elevated Train in Commemoration of H.M. the King 6th Besides revenue from fares, the Company also generates Cycle Birthday (BTS Skytrain) at Si Lom Station, Sukhumvit revenue from commercial development, which can be divided Station and Chatuchak Park Station, connection with into two groups as follows: Suvarnabhumi Airport Rail Link and Bangkok City Air 1. The Company directly executed agreements with other Terminal (Airport Link) at Phetchaburi Station, connections companies by granting the following rights: with trains of the State Railway of Thailand (SRT) at Hua • Automatic Teller Machine (ATM) service, totalling 160 Lamphong Station, Phetchaburi Station and Bang Sue machines, in all 18 stations to 8 commercial banks; Station, connections with public bus service of more than • One currency exchange booth inside a station; 121 routes, as well as connections with large-size real • Public telephone service, totalling 80 machines, in all estate projects, e.g., an underground connection with 18 stations to True Corporation Public Company Chamchuri Square Building at Sam Yan Station, an Limited; underground connection with Central Plaza Grand Rama 9 • True Kiosk (Multi-function self - service kiosk) service at Phra Ram 9 Station, etc. by True Money Co., Ltd., totalling 32 machines, in all 18 stations, for acceptance of payments of goods, 9.1 Nature of Products and Services services and bills for self-service by customers; The Company’s revenue can be divided into two categories • Procurement and/or production of advertising banners comprising revenue from fares and revenue from commercial on the hand grip media in 19 trains and benches in all development. 18 stations to Ambient Media Co., Ltd. • My Pay service, totalling 36 machines, in all 18 stations Revenue from Fares to My Pay Co., Ltd. Revenue from fares is the Company’s major revenue. The fare collection by the Company is subject to the number 2. The Company granted the following rights to the Subsidiary: of stations travelled by passengers. The fare rates of the The Company granted the rights to the Subsidiary, metro as of the commencement date would be in accordance namely, Bangkok Metro Networks Limited in procurement with the basic reference fare rates in force at the time of of image advertisement, including platform billboard, the revenue service commencement date. Under the administration of advertisement media via the Passenger Concession Agreement, the reference fare rates would be Information Display Systems (PIDs), digital media, adjusted every 24 months based on the actual changes of management of retail spaces, as well as service and the Bangkok Non-Food Consumer Price Index compared maintenance of telecommunications system equipment. to the basic reference fare rates as at 1 January 2002. In return, the Company receives a revenue sharing before The Company adjusted the fare rates under the terms of deduction of expenses, as well as dividend from the the Concession Agreement accordingly. The current fare Subsidiary.

Annual Report 2013 Bangkok Metro Public Company Limited 49 Business Operation of the Subsidiary Shareholding Structure On 25 February 2009, Bangkok Metro Networks Limited As at 31 December 2013 (“BMN”) was incorporated through the amalgamation of the former three subsidiaries, namely, BMCL Network Limited, Metro Mall Development Limited and Triads Networks Bangkok Metro Public Company Limited Company Limited. BMN accepted the transfer of the existing Paid-up capital of Baht business operations, including all rights, obligations, property 20,500 million and liabilities and staff of the former three subsidiaries. Currently, BMN’s registered capital is Baht 254 million (25,400,000 ordinary shares at the par value of Baht 10 per shareholding of share). The Company holds 16,558,560 shares in such Subsidiary or representing 65.19%. 65.19%

The Company granted the following rights to the Subsidiary: Bangkok Metro Networks Limited 1. To procure and/or make advertising boards Paid-up capital of Baht 254 million Procurement and/or making of advertising boards or media in all 18 stations and for all 19 trains (MRT metro), comprising advertising media of various forms and sizes, e.g., light boxes, sticker media, platform billboard, digital media, as well as advertising media via the Passenger Information Display Systems (PIDs), to display the still and animation pictures, audio, messages on the PID screen, installed in 18 stations, totalling 265 screens, and in 19 trains, totalling 342 screens. 2. To lease retail spaces in stations Lease of retail spaces in 11 MRT stations, comprising Khlong Toei Station, Queen Sirikit National Convention Centre Station, Sukhumvit Station, Phetchaburi Station, Phra Ram 9 Station, Thailand Cultural Centre Station, Ratchadaphisek Station, Lat Phrao Station, Phahon Yothin Station, Chatuchak Park Station and Kamphaeng Phet Station, and spaces in the basement level of the Lat Phrao park and ride facility, covering the total commercial lease spaces of approximately 14,236 square metres (spaces for retail shops and sale promotions). To date, the retail shops are opened in five stations, namely, Sukhumvit Station, Phahon Yothin Station, Chatuchak Park Station, Kamphaeng Phet Station and Phra Ram 9 Station. 3. To provide service and maintenance of telecommunications system equipment Provision of service and maintenance of telecommunications system equipment, particularly mobile phone network, inside the metro stations and tunnels, as well as Hi-speed Internet, the Wi-Fi services, and the telecommunications signal systems in the metro stations and tunnels on 3G.

Annual Report 2013 50 Bangkok Metro Public Company Limited Revenue Structure of the Company’s Group The revenue of the Company and its Subsidiary in 2011, 2012 and 2013 is as follows:

(Unit: million Baht) Shareholding 2013 2012 2011 Operated by percentage of the Company Revenue % Revenue % Revenue % Revenue from MRT operations The Company - 2,106.36 83.03 1,979.35 86.78 1,645.87 86.48 Revenue from advertising media services The Subsidiary 65.19 258.91 10.21 188.14 8.25 158.97 8.35 Revenue from telecommunications services The Subsidiary 65.19 114.12 4.50 58.32 2.56 53.43 2.81 Revenue from retail space leases The Subsidiary 65.19 20.73 0.82 16.58 0.73 16.89 0.89 Revenue from ATM and public telephone services The Company - 26.14 1.03 25.51 1.12 23.34 1.23 Revenue from other commercial development The Company - 1.86 0.07 2.22 0.10 0.99 0.05 /1 The Company Other income and its Subsidiary - 8.88 0.35 10.62 0.46 3.72 0.19 Total 2,537.00 100.00 2,280.74 100.00 1,903.21 100.00 Notes : /1 : Other income in 2011 comprised interest income in the amount of Baht 0.84 million and other income in the amount of Baht 2.88 million. Other income in 2012 comprised gain on exchange rate in the amount of Baht 2.64 million and revenue from other services in the amount of Baht 7.98 million. Other income in 2013 comprised interest income in the amount of Baht 0.45 million and revenue from other services in the amount of Baht 8.43 million.

9.2 Procurement of Products and Services The M.R.T. Chaloem Ratchamongkhon Line Project (“Blue Line”) (Hua Lamphong Station and Bang Sue Station) (1) Management of the MRT Project The Company engaged Joint Venture CKET as the project manager for the MRT project (Project Manager) (from August 2000 to July 2009) to manage technical operations, such as, procurement of the M&E Equipment as ordered from manufacturers and liaison with contractors and relevant administer and manage the MRT Project, as well as improving authorities regarding the installation of the M&E Equipment. and developing the efficient service provision on its own. Joint Venture CKET is a joint venture between CH. Karnchang Public Company Limited and Expert Transport Company (2) Procurement and Maintenance of the M&E Limited (an affiliate of CH. Karnchang Public Company Equipment Limited Group, the major shareholder of the Company). The Company engaged Lincas and Siemens, one of the Upon expiration of the engagement agreement of CKET for world’s largest modern electric train manufacturers and project management, the Company was able to efficiently developers of railway systems from Germany, to manufacture the M&E Equipment. Lincas and Siemens are responsible

Annual Report 2013 Bangkok Metro Public Company Limited 51 for the design, manufacture, supply, installation, testing and with running rails, power rails, maintenance walkways, commissioning of the M&E Equipment, comprising the rolling tunnel ventilation system, underplatform exhaust and stocks, power supply system, signalling and communication heat detector systems for the maximum safety for system, automatic fare collection, platform screen doors, the train operations inside the tunnels. maintenance equipment, signage and signals, as well as responsible for proposing train operation plans, the (2.3) Ventilation System Company’s management structure, recruitment plan, and Stations and tunnels have a ventilation system all requirements relating to train operations by way of training installed with ventilation fans on either side of the for every level of the Company’s staff to have knowledge station and within the tunnel for the safety of and skills in administration of the train operations, and passengers. Fans control the temperature and engaging Siemens as a contractor for maintaining the M&E condition inside the stations and tunnels. Equipment for a period of 10 years (July 2004 to July 2014). Subsequently, the Company was able to develop the (2.4) Rails/Tracks body of knowledge in respect of the procurement of the There are two types of tracks, running rails and power M&E Equipment, by way of learning from experience and rails or third rails, as follows: participation as a member in the international federations - Running rails are double rails with 1.435 metres of public transport operators, such as, UITP, APTA, NOVA width (standard gauge) and railway tracks are laid Group of Metros, as well as learning from Lloyd’s Register and directly fixed to the track base, which is made Rail, a highly experienced consultant in respect of the mass of a reinforced concrete structure between Hua rapid transit system by the metro in overseas. At present, Lamphong and Bang Sue; railway sleepers are the Company’s team is able to procure the M&E Equipment used in the depot as is the case of the State on its own. Railway of Thailand. - Power rails or third rails are laid parallel to either M&E Equipment and Components of the Metro side of the running rails in order to connect These can be divided into two parts: civil infrastructure electricity from the source to the train, while the operated by the MRTA, and the M&E Equipment operated double running rails act as an electric conductor by the Company, as follows: back to the source.

Civil Infrastructure Operated by the MRTA. M&E Equipment Operated by the Company (2.1) Stations (2.5) Rolling Stocks All stations of the metro are supported by reinforced The Company has ordered 19 trains from concrete structures which are 15-25 metres beneath Siemens, the world’s leading electric train the road surface. Each station has different levels manufacturer and assembler. The rolling stocks and areas depending on the depth of the station. are made of robust and durable stainless steel There are three kinds of platforms, namely, central with modern style and would have a service life platform, side platform, and stack platform. Each of approximately 30 years. Each train consists station has a control room for the control, observation of three carriages with a total of approximately and monitoring of any malfunctions within the 70-metre long, and can carry up to 900 passengers station. with the transferring capacity of 40,000 passengers per hour per direction. (2.2) Tunnels Underground tunnels are supported by reinforced (2.6) Signalling and Communication System concrete structures designed to be flexible and A good signalling and communication system is water-resistant. The inner diameter is 5.7 metres, necessary for safe, fast, reliable and punctual train thickness is 30 centimetres and outer diameter is operations and is considered as an important factor 6.3 metres. It is a two single tunnel system equipped of train management. The control centre is located

Annual Report 2013 52 Bangkok Metro Public Company Limited in the depot. Train operations are automatic 4) Automatic Gates computer system supervised by engineers. In the The system is referred as a “contactless” system. stations, a radio communication system with direct Passengers enter or exit the system by using the phone lines is used for officers to communicate so ticket (token or stored value card) across the card that passengers can immediately notify an emergency readers located on the top of the automatic gates to the officers. In case of any emergency, the within 10 centimetres, without any contact required automatic broadcasting system will start to provide to open the gate. relevant information and direct the way out of the station. (2.9) Platform Screen Doors (PSD) Glass PSDs spanning from the floor to the ceiling (2.7) Supervisory Control and Data Acquisition System are installed along the length of the platforms, (SCADA) and Closed Circuit Television between the platform and the train. This is for the Monitoring and supervision of the functions of the safety of passengers while entering and leaving the main equipment inside the stations and tunnels, such train so as to prevent any accident from passengers as, the fire alarm system, cooling system, elevators falling from the platforms or injury from the train and escalators, power supply system within the docking at the stations, as well as helping saving station and power supply system for the locomotive energy in respect of the air-conditioning system and system, tunnel lighting system and ventilation system minimising noise pollution. in the tunnels, are carried out by the SCADA installed at the operation control centre. In case of any (2.10) Power Supply malfunction, an alarm will start immediately to notify The power supply is designed in accordance with the officers in charge to rapidly and promptly check international standards for safety and reliability in such system. the supply of power to all electrical equipment, such Closed circuit televisions are installed in various as, sub-stations and transformers, which are important spots inside the stations to monitor for necessary for supplying power to the train and in the safety and playback to identify any incident. The stations and the tunnels. The system is designed closed circuit televisions are also installed in the train based mainly on safety and continuity of services. operator cabin to monitor passengers entering and leaving trains while docked at the stations to ensure (2.11) Depot Building and Central Control Centre safety before closing the doors. The depot consists of the depot building, operation control centre building, rolling stock parking area, (2.8) Automatic Fare Collection System (AFC) training centre and administration building and is The AFC consists of tickets, token vending machines, located on a total area of approximately 300 rai on ticketing offices and automatic gates, with the Rama IX Road, close to the Thailand Cultural Centre following characteristics: Station, owned by the MRTA while the Company 1) Tickets are divided into two types: single journey has the right to use the same throughout the tokens for a single trip, and stored value cards, which Concession period. are contactless smart cards for multiple journeys, The operation control centre is located in the same suitable for regular passengers. area as the depot. This centre is the most important 2) Token Vending Machines (TVM) component of the operation control system, namely, TVMs are located on the concourse level and issue to control and direct every station and every train to only single journey tokens. ensure safe, rapid and punctual operations. In case 3) Ticketing Offices of any force majeure preventing the functioning of Ticketing offices are manned by officers and equipped this operation control centre, another back-up with machines for issuing both tokens and stored operation control centre located at the depot would value cards of all types. control and direct the operation as normal.

Annual Report 2013 Bangkok Metro Public Company Limited 53 Design of the Metro System for Flood Prevention 3. Flood Prevention Equipment The structures of the Metro system are designed to prevent - There are Stop Log and Flood Board available for flood, as follows: installation at every entrance-exit. - The Flood Gates can be installed at stations connected 1. Station Structure with building at the underground level. - The structure of the entrance-exit of stations is designed to raise the level of entrance-exit staircases of stations 4. Water Pumping and Drainage Systems and the entrance-exit of the ventilation building at an - There are water tanks inside each station, underneath average height of 1.2 metres above the pavement the escalator and underneath the platform, for storing level or approximately 2 metres above sea level. and pumping water out through the BMA drainage - In case of flood, the highest flood level is 2.5 metres system. above sea level (highest record in 200 years) or - At the depot approach, rainwater will pour down to approximately 1.7 metres above the pavement level, the tank in front of the depot approach, which will then which will be higher than the height of the entrance-exit be pumped up to the BMA drainage system. staircases and the entrance-exit of the ventilation - Along the tunnel line, there are ditches and drainage building by approximately 0.5 metre. In order to prevent system for any water leakage flowing to the water water from flooding into stations and tunnels, the flood tank at the centre of the tunnel or in the air ventilation prevention equipment (Stop Log, Flood Board) with a shaft, where water will be pumped up to the BMA height of 1.5 metres can be installed on the entrance-exit drainage system. staircases and the entrance-exit of the ventilation - The end of the drainage system is designed to be building as an additional measure. Therefore, the located at a high level with a system to prevent any designed flood prevention system would prevent water reverse flow of water. at the level of one metre higher than the highest record in 200 years. In addition, the Metro system has the systems for water level inspection and notification. The Operation Control 2. Structures of Depot and Operation Control Centre Centre can monitor the operating status of the water pump - The depot approach is 3 metres above the ground and the unusually high water level in the water tanks, level. which will be alarmed via the SCADA system. Moreover, - The depot is situated on the elevated piles at 3 metres the Company has action plans to cope with an emergency above the ground level. situation in case of flood which may affect the Metro service provision by preparing a plan to handle the possible flooding, and the action plans for all relevant units, namely, station staff, train operators, engineering and maintenance section, Operation Control Centre, and supporting units, namely, security staff, train operation supporting section, public relations, etc.

Annual Report 2013 54 Bangkok Metro Public Company Limited Types of Tickets Available at Stations, Ticketing Channels and Fare Rates

Types Forms Types of Customers Minimum Value at First Issue 1. Single Journey Token Adults and with discount for children Distance-based and elders for one journey

2. Adult Pass /1 General public Baht 230

3.Child/Elder Pass /1 - Children aged up to 14 years inclusive Baht 230 with a height of 91-120 cm. - Elders aged 60 years or older

4. Student Pass /1 Student aged up to 23 years inclusive Baht 230

5. 1 Day Pass Unlimited number of journeys and Baht 120 distance within one day from first use, which cannot be topped up or refunded

6. 3 Days Pass Unlimited number of journeys and Baht 230 distance within three days from first use, which cannot be topped up or refunded

7. 30 Days Pass Unlimited number of journeys and distance Baht 1,400 within 30 days from first use, which cannot be topped up or refunded

Notes /1 The stored value cards comprise Baht 150 for fares, Baht 50 for card deposit, and Baht 30 for issuance fee. The cards can be topped up at Ticketing Office. The cards will be invalid upon a lapse of two years after last use.

Annual Report 2013 Bangkok Metro Public Company Limited 55 Ticketing Channels 1. Token Vending Machine (TVM) issues single journey tokens for adults for single trip. 2. Ticketing Office (TO) issues single journey tokens for adults, single journey tokens for children/elderly for single trip and also issues stored value cards for multiple journeys, e.g., Adult Pass, Child/Elder Pass, Student Pass, 1 Day Pass, 3 Days Pass and 30 Days Pass. The MRT passengers may pay fares via credit cards at the Ticketing Office of each station in order to add more channels of fare payment, provided that the minimum payment via credit card is Baht 300. Fare Rates based on the number of stations and the type of ticket From 3 July 2012 - 2 July 2014

Unit : Baht

(No. of Travelled Station) 0-1 2 3 4 5 6 7 8 9 10 11 12-17 Stored Value Card Adult 16 18 20 22 25 27 29 31 34 36 38 40 Student/1 14 16 18 20 23 24 26 28 31 32 34 36 (discount 10%) Child/2 / Elder/3 8 9 10 11 13 14 15 16 17 18 19 20 (discount 50%) Single Journey Adult 16 18 20 22 25 27 29 31 34 36 38 40 Token Child/2 / Elder/3 8 9 10 11 13 14 15 16 17 18 19 20 (discount 50%) Notes : The Company sets out the MRT special fare rates for child, elder and student, as follows: /1 Student refers to a person aged not older than 23 years and/or not reaching his/her 23rd birthday anniversary, under an educational institution; /2 Child refers to a person aged not older than 14 years and/or not reaching his/her 14th birthday anniversary, with a height of 91-120 cm.; /3 Elder refers to a person aged 65 years or older and/or reaching his/her 65th birthday anniversary. Additional Benefits : • A person aged not older than 14 years and/or not reaching his/her 14th birthday anniversary, with a height of not exceeding 90 cm. is exempted from fare; • A person aged 60 years or older and/or reaching his/her 60th birthday anniversary will be granted a discount on fare like an elder; • A person holding ID Card for Person with Disabilities issued by the National Office for Empowerment of Persons with Disabilities is exempted from fare.

Annual Report 2013 56 Bangkok Metro Public Company Limited for the MRT Purple Line Project which the Company is carrying Common Ticketing System Development out under the Concession Agreement granted by the MRTA, Given the government sector’s Mass Rapid Transit Master Plan it is necessary for the Company to properly reconsider in Bangkok Metropolitan and Surrounding Areas, the policy to guidelines for implementation of the common ticketing system require the common ticketing system development has been set development project in coordination with Bangkok Mass out for enabling passengers to use only one ticket for travelling Transit System Public Company Limited and Bangkok by the mass rapid transit system in Bangkok and surrounding Smartcard System Company Limited, as well as the common areas, by the metros, buses, express boats, including use of such ticketing system and central revenue management centre ticket beyond the mass transit sector, such as, restaurants, developer of the OTP, to facilitate the common ticketing convenience stores, etc. service on the MRT System to passengers and the public.

In 2009, the Company jointly implemented the common (3) Connections and Park and Ride ticketing system development project, in their capacity as At present, the MRT System provides an underground the mass rapid transit service providers, with Bangkok Mass connection between Chamchuri Square (residence, office Transit System Public Company Limited and Bangkok tower and entertainment complex and education centre) with Smartcard System Company Limited, which is a company Sam Yan Station, an at-grade connection between Union operating a business of electronic payment via the metro Mall and Phahon Yothin Station, and a connection between ticketing system, to carry out the design and determination the Interchange Building 21 and Sukhumvit Station, and a of the new ticket standard and specifications of equipment direct connection between Phra Ram 9 Station and Central for fare collection system and the Front End Upgrade System. Plaza Grand Rama 9. The new ticket can be used for travelling by both systems, namely, the MRT and the BTS, including the standard Connections and Park and Ride areas, which the MRTA specifications of equipment; and the standard Front End administers and collects service fees for parking buildings Upgrade System will be based on by the mass rapid transit and parking lots, will facilitate passengers to park their service providers or other service providers than the mass personal vehicles for further riding the metro to destination transit system sector in the future, to initiate such common (Park and Ride). To date, there are 11 Park and Ride ticket widely and widespread. facilities, with parking spaces for a total of 4,383 cars, are as follows: However, the government by the Council of Ministers subsequently passed a resolution on 3 May 2012 authorizing the Office of Transport and Traffic Policy and Planning (OTP) Parking Buildings to implement the common ticketing system management project, with a purpose to develop the common ticketing system standard and arrange for developer of the common Station Entrance - Exit Parking Spaces (cars) ticketing system and the central revenue management centre of Thailand’s national transport system, in order to facilitate Thailand Cultural Centre No. 2 200 convenient transport system to the public by the metro service Lat Phrao (9-storey Parking Building) No. 4 2,200 under the Mass Rapid Transit System Development Plan for 10 routes, as well as other mass rapid transit systems, such as, public bus and boat services, and expressways, etc. Therefore, upon considering the direction in the implementation of the common ticketing system by the government, as well as the supply of the ticketing system

Annual Report 2013 Bangkok Metro Public Company Limited 57 Parking Areas

Station Entrance - Exit Parking Spaces (cars) Sam Yan No. 1 32 Queen Sirikit National Convention Centre No. 2 79 Sukhumvit No. 1 33 Phetchaburi Under the Si Rat Expressway (Asoke 1 Toll Plaza) 300 Phra Ram 9 Ratchada Soi 2 50 1/ No. 1 32 Thailand Cultural Centre No. 2 (Ratchada Soi 6) 106 Huai Khwang No. 1 76 Ratchadaphisek No. 4 75 Chatuchak Park 2/ Old Mo Chit Bus Terminal 1,250

Notes : 1/ For monthly parking service users only. 1/ In Chatuchak Park Station, the metro passengers can use the parking areas free of charge. The land of Chatuchak Station has been supported by the Crown Property Bureau and the Company and Bangkok Mass Transit System Public Company Limited (BTSC) have sponsored electricity and lighting costs and security costs.

Parking fees • Baht 15 per two hours for MRT passengers by presenting the parking smart card on its reader at the terminal station; • Baht 40 per hour for non MRT passengers, except Phetchaburi Station and Sukhumvit Station parking areas which charge at Baht 50 per hour; • The monthly parking service fee is Baht 1,250 per month for 9-storey Parking Building at Lat Phrao Station, and Baht 1,500 per month for other parking areas. The MRTA determines and collects such parking fees.

Annual Report 2013 58 Bangkok Metro Public Company Limited (4) Full Passenger Capacity of the M.R.T. Chaloem Ratchamongkhon Line Table of Full Passenger Capacity on the MRT Metro and Number of Passengers in 2012 - 2013

2011 2012 2013 Number of Days of Service (Days) 365 366 365 Number of Trains in Service (Trains) 19 19 19 Full Passenger Capacity Per Day (Trips) 336,680 336,680 336,680 Full Passenger Capacity of the Metro (Trips) 122,888,200 123,224,880 122,888,200 Number of Actual Passengers of Service (Trips) 69,098,306 80,602,327 86,435,968 Utilisation Rate Per Full Passenger Capacity 56.23% 65.41% 70.34%

The MRT Purple Line Project, Bang Yai - Rat Burana, Centre Station and crosses the at the Bang Yai - Bang Sue Section (Khlong Bang Phai parallel bridge in the south of Phra Nang Klao Bridge and Station - Tao Poon Station) approaches the vicinity of Amphoe Bang Yai via Bang Rak The MRT Purple Line Project is a heavy rail transit Noi Interchange and Bang Phlu Intersection, turns right at system, having a standard gauge of 1.435 metres, with third Bang Yai Interchange along the Outer Ring Road (West) rails laying parallel to either side of the running rails in order and ends the route at Khlong Bang Phai Station where depot to supply power to the train. The track structure is entirely and workshop will be located for the route from Khlong Bang elevated at the height of approximately 17-19 metres above Phai Station - Tao Poon Station. road surface, in order to cross over flyovers, bridges and All 16 stations have been designed in accordance with U-turn bridges, with columns in the middle of the road line, NFPA 101 and NFPA 130 standards, focusing on life and having a maximum distance of 40 metres between columns, property safety, convenience of passengers, passersby, to minimize impact on traffic both during construction and nearby residents, taking into account the environment of after construction completion. The MRT Purple Line Project, such areas, together with various facilities, for example, Bang Yai - Rat Burana, Bang Yai - Bang Sue Section (Khlong elevators, escalators, facilities for persons with disabilities. Bang Phai Station - Tao Poon Station) has a total distance The stations are elevated, with an area of approximately of approximately 22 kilometres, covering 16 stations. The 250 metres long and 18 metres wide. The form of central route of the Project starts from Tao Poon Station which platform and area arrangement of the stations comprise: shares an interchange station with the MRT Blue Line 1. At-grade level is the approach to the station from Extension, Bang Sue to Tha Phra Section, at Tao Poon footpaths of both sides of the road, which would not Intersection along Bangkok - Nonthaburi Road and then obstruct pedestrians’ passage, with sufficient waiting heads north via Bang Son railroad crossing which is space and shelter, as well as flood prevention system. connected with the SRT Light Red Line Commuter Train at Passengers may conveniently connect with other at-grade Bang Son railway station through Wong Sawang Intersection mass transit systems. until the end of Bangkok vicinity and approaches Tambon 2. Concourse level is an open-air passenger service floor, Bang Khen, Amphoe Mueang, Nonthaburi Province, and with ticketing vending machines and automatic card/ticket turns right onto Tivanon Road, then turns left before Khae readers. Passengers may use this floor to cross the Rai Intersection onto Rattanathibet Road, heads west, at-grade road. Certain stations may connect with connected with the starting point of the monorail for the Pink adjacent buildings or parking facilities of the Project. Line (Khae Rai-Pakkred-Minburi) at the Nonthaburi Civic 3. Platform is a level for passengers to get on and off the metro

Annual Report 2013 Bangkok Metro Public Company Limited 59 service. The area is broad and spacious, with the central Works during Phase 2 : Operation Service and Maintenance section reserved as two open-air ventilation channels, of the M&E Systems, with a value of Baht 61,213 million the half-height Platform Screen Doors, passenger stairs (inclusive of value added tax) at the end of both sides of the platform, and emergency exits. The Company shall be obliged to carry out and be responsible for the Operation Service and maintenance There are four Park & Ride facilities along the route, namely, of the M&E Systems from the commencement date of Khlong Bang Phai Station, with parking space of approximately the Operation Service of the MRT Purple Line Project 1,800 vehicles; Sam Yaek Bang Yai Station, with parking space as approved by MRTA until the end of the term of the of approximately 1,772 vehicles; Bang Rak Noi - Tha It Station, Concession Agreement. with parking space of approximately 1,244 vehicles, and Yaek The Railway Systems comprises 21 rolling stocks with Nonthaburi 1 Station, with parking space of approximately three bogies each, with a capacity of approximately 320 470 vehicles. persons per bogie, and not less than 50,000 persons The Company entered into the Agreement for the MRT Purple per hour per direction, manufactured in Japan. The Line Project, Bang Yai - Rat Burana, Bang Yai - Bang Sue Section Company executed the agreement for engagement of (Khlong Bang Phai Station - Tao Poon Station), Contract 4: Marubeni Corporation and Toshiba Corporation for supply Concession for Supply of M&E Systems and O&M Services of trains, power supply equipment, signaling system, (Khlong Bang Phai Station - Tao Poon Station), with MRTA on control and communications systems, as well as 4 September 2013. The total value of the Agreement is maintenance service for a period of 10 years. The rolling Baht 82,625 million (inclusive of value added tax), on a PPP stocks will be manufactured by Japan Transport Gross Cost basis. The Company, as concessionaire for the Engineering Company (J-TREC), as a member of East MRT Purple Line Project, has the main duties to carry out the Japan Railway Company Group (JR East). design, supply, installation and testing of the M&E Systems 9.3 Industrial Conditions and Competition and other related systems, including operation and maintenance Economic Conditions services of the MRT Purple Line Project throughout the The economic recession in 2013 was in line with a slowdown concession period of 30 years from the date of execution private consumption after a substantially accelerated spending of the Agreement, divided into two phases, as follows: in 2012, with an economic growth of up to 6.5% from unusual production and spending after production halt due to flood crisis Works during Phase 1: Design, supply, installation, testing of in 2011, thereby resulting in closure of various factories and the M&E Systems and other related systems, including trial companies as well as machinery damage. In addition, in 2013, running to ensure its readiness for general public services certain business operators postponed their investments in order until the commencement of the Operation Service, with a to assess the economic and political situations. The economic value of Baht 21,412 million (inclusive of value added tax) growth rate in 2013 was at 2.9% (Source: Office of the National The Company shall be obliged to carry out and be Economic and Social Development Board). Although the global responsible for design, supply, installation, testing of the economy was improved, the export sector slowly recovered since M&E Systems and other related systems and trial running certain industries encountered a shortage of raw materials, to provide general public services under the specified terms as well as manufacturing technology constraints, and as a result, and conditions, for a total period of not exceeding 1,200 it was not possible to manufacture sufficient goods in response days from the date of execution of the Concession to the changing global demand. The public sector’s role in Agreement with MRTA, unless an extension of time is stimulating the economy was less active than the previous year granted by MRTA. as investment budget disbursements were lower than usual. In this regard, upon completion of the period of Works Tourism sector substantially expanded and stimulated Thailand’s during Phase 1 of the Contract, the Company shall deliver economy in 2013. However, in the last quarter of 2013, tourism the ownership of such assets constructed or provided growth slowed down due to China’s tourism law enforcement under the Concession Agreement to become the ownership from October 2013, including Thailand’s political events. of MRTA pursuant to Section 46 of the Mass Rapid Transit Moreover, the political rallies since late October 2013 through to Authority of Thailand Act B.E. 2543 (2000) and MRTA 2014 has given rise to impact on consumers’ and investors’ shall grant the right to utilize the Civil Infrastructure and confidence, and as a result, Thailand’s economic growth in assets constructed or provided under the Concession 2013 was decreased by 0.3 - 0.5% to a growth of merely 3.0% Agreement to the Company for use in the performance of (Source: The Centre for Economic and Business Forecasting, Works during Phase 2 of the Contract under the Agreement. University of the Thai Chamber of Commerce).

Annual Report 2013 60 Bangkok Metro Public Company Limited With respect to global economy in 2013, the economy of political situation. The political situation since late 2013 the United States of America was likely to slow down from the resulted in positive impact on the Company, to be further previous year as a result of increased rates of income tax and described in Government Policy and Political Situation. withholding tax of wages for contribution to social security fund, including state expenditure cut, as well as a sudden tight Oil is the most important cost of the transportation financial condition due to investors’ expecting a QE downsizing system. Crude oil in the global market and fluctuating since late May 2013. The economy in European countries tended exchange rate resulted in fluctuating oil price in the to improve since the second quarter by domestic consumption country accordingly. As from 2011, oil price was likely and exports in major countries, particularly Germany. Japan’s to increase. Oil retail prices for gasohol 91 and gasohol economy in the first two quarters recovered due to the government 95 in Bangkok and its vicinity increased from Baht 31.94 policy on economic stimulation, and then slowed down in the per litre and Baht 33.69 per litre in 2011 to Baht 38.08 third quarter due to slight decrease in government’s economic per litre and Baht 40.53 per litre in 2013. Diesel price stimulation as well as exports decrease due to lower consumptions did not change much due to the government’s control in its counterparties. However, Japan’s economy in the last of diesel price to stay not exceeding Baht 30 per litre. quarter tended to expand again as a result of the exports recovery Increasing oil price directly affects people’s travelling and accelerated private consumption before its increased costs by cars and public transportation, which is considered consumption tax. China’s economy expanded at 7.7% from the a positive factor for the metro system service industry. previous year, mainly due to its domestic demand, consumption and investment, as a result of the government’s economic stimulus a) Overview of Mass Rapid Transit Systems and measures implemented in the second half of the year, and Competition improved exports in line with the economic recovery of major 1. Mass Rapid Transit Systems in Bangkok and its Vicinity industrial countries. The economy in most Asian countries Bangkok is a large capital city, with various modes of improved from the previous year mainly due to exports recovery. transportation systems, for example, personal cars, public buses, metro, micro buses, taxis. The traffic problem in Thailand’s economic projections in 2014 are likely to expand Bangkok is considered a major problem which is not different by 4.0 - 5.0% (Source: Office of the National Economic and from other highly populated capital cities around the World. Social Development Board), mainly due to the improved The government has a policy to resolve traffic problem in global economy; while the economy in Asia would continue order to accommodate the economic growth of the country, to expand at a high level. The policy interest rate reduction such as, the Outer Ring Road Project, Railway Transit in late 2013 resulted in a policy interest rate at 2.25% to System Project, and elevated roads in Bangkok, the MRT stimulate the domestic economy, and the government system, which reflects the increased budget allocated to focused on its policy to increase revenue and reduce people’s the Ministry of Transport for improvement of the overall cost of living the people, in order to stimulate purchasing transport system of the country each year. power in the country. However, there remain certain negative factors which might cause the economic expansion in 2014 (1) Personal Transport System to be lower than projected, e.g., uncertainty of the global People’s residences in Bangkok are spread all over, economic expansion, political conflicts and rallies against including its vicinity, travelling by personal cars is most the government, exchange rate fluctuations, shortage of popular and becomes essential for travelling to main labors in certain industries, increased cost of production roads. In addition, personal cars reflect people’s social and cost of living, such as, labor cost, energy price, oil price, status, along with the defects in the existing mass transit electricity charge, transportation expenses, etc. In addition, systems, especially in Bangkok and its vicinity, thereby in 2014, it is expected that exports would expand by 7.0%; most people are forced to choose to travel by personal overall household consumption and investment would cars in Bangkok and its vicinity. The growing number expand by 2.9% and 8.7%, respectively. Headline inflation of high-paid or middle-class people, together with the would range between 2.1 - 3.1%; and current account would inadequacy of the existing transport systems, as well sustain a deficit at 0.6% of GDP (Source: Office of the National as the service quality and safety, has caused personal Economic and Social Development Board). However, it cars to become essential and convenient for travelling. may be concluded that the economic expansion would Moreover, during September 2011 to December 2012, depend on the global economic recovery and Thailand’s the government’s tax refund campaign for first-time car

Annual Report 2013 Bangkok Metro Public Company Limited 61 buyers stimulated the increase in the volume of cars on Average Daily Volume of Passengers the roads, as evidenced by the increased cumulative Trip : Day volume of (four-wheeled) cars registered, particularly 2,500,000 during 2012 and 2013. 2,000,000 1,500,000 (2) Public Transport System 1,000,000 The traffic congestion problem, especially during rush hours, ARL 500,000 MRT results in consumers’ substantial demand in certain modes BTS รถไฟ of public transport system, particularly the metro system. 0 ขสมก. However, considering the average passenger volume 2008 2009 2010 2012 2013 travelling by a variety of land transport systems, public bus Sources : Ministry of Transport, Bangkok Metro Public Company Limited, service is the most popular choice, although the volume of BTS Group Holdings Public Company Limited and the State public bus service users has continued to decrease; while Railway of Thailand the volume of passengers in the mass rapid transit rail system has substantially increased. Public Bus Service BTS Skytrain The public bus system in Bangkok has continued to improve. BTS Skytrain is Thailand’s first mass rapid transit rail At present, there are various types of public buses for service system based on electric motor on the elevated dual tracks at different service rates. The types of public buses vary from and directions, with a side power rail (Third Rail System). the “Red” BMTA public buses, as basic public buses at a rather The system can accommodate more than 1,000 passengers cheap service rate; or standard air-conditioned public buses, per train. This is considered one of the efficient transport as well as limited number of “micro buses”. The average speed systems. BTS was opened for service on 5 December 1999 of public buses remains low, due to the traffic congestion in 2 lines, namely, and , and currently, on various roads, especially rush hours in the morning during has a total distance of 36.9 kilometres, with 34 stations. 6:30 hours to 8:30 hours, and in the evening during 16:30 hours to 18:30 hours, and as such, travelling becomes inefficient In 2012, BTS Skytrain’s average daily volume of passengers and time-consuming. In addition, passengers are also was approximately 540,233 persons, which increased by affected by safety issues from the service and pollution 12.32% from 2011, due to the development of more caused by carbon emissions. These negative factors have connections with commercial buildings through investments likely caused the volume of BMTA passengers to decline by both BTS and commercial building owners, expansion and change to use the mass rapid transit rail service more. of businesses around the routes, and its connections with the MRT, which expanded its service network. Trains In the past, the State Railway of Thailand (SRT) provides ARL train service in Bangkok at special low rate in order to serve The Suvarnabhumi Airport Rail Link or Airport Rail Link or low-paid people to travel from the outskirts of Bangkok to Airport Link is a special mass rapid transit rail system project, downtown. However, such system is rather inconvenient as part of the project for construction of suburban and commuter in terms of train condition, non-air conditioning, limited routes rail systems, carried out and operated by the State Railway which do not cover the entire city, and as a result, the growth of Thailand (SRT). The structure of the Suvarnabhumi Airport rate of train service is negative. In this regard, the SRT’s Rail Link is both underground and elevated, with the alignment train service is not considered the Company’s direct accommodating journeys from the eastern and northern competitor due to different service routes, as the SRT aims outskirts, and passengers from the Suvarnabhumi Airport, to provide service to suburban areas. to the centre of Bangkok at , covering a total of 8 stations, with a distance of 28.6 kilometres. Airport Link was opened for service on 23 August 2010 in two modes, namely, Express Line and City Line.

Annual Report 2013 62 Bangkok Metro Public Company Limited The transport systems which are considered the Company’s Project, shopping centre projects, and The 9th Tower Project, direct competitors are personal cars, public buses, micro an office building project, which are expected to give rise buses, public vans and taxis. In the past, the public transport to a positive effect on the volume of the MRT passengers service rates, especially normal or air-conditioned public in Kamphaeng Phet Station, Lat Phrao Station, Ratchadaphisek buses did not change much despite oil price increases. This Station and Phra Ram 9 Station, respectively. was because fare rates were controlled and subsidized by the government. However, the public road transport system Government Policy and Political Situation was affected by the traffic congestion, particularly during Given the continuing oil price increases, along with a growing both morning and evening rush hours. Moreover, service density of urban population, and trendy change in of behavior users suffer from air and noise pollutions as well as potential towards effective energy consumption, as evidenced by the accidents. Therefore, the MRT has an advantage from its increased use of a diverse variety of convenient public rapid, punctual, convenient, safe and eco-friendly service. transport systems, the government has turned to focus on As for personal cars, other than the aforesaid factors, oil more investment in the public transport systems, especially price increases have caused more personal car owners to use investment in the mass rapid transit rail systems, to promote the mass rapid transit rail systems by personal car users. energy saving, optimize the efficient use of energy, and minimize costs of imported energy. Real Estate Development around the MRT Routes The growth of real estate development projects around the In the meantime, the government also has a policy to resolve MRT routes remains positive for the MRT service, taking into the traffic problem in Bangkok by maintaining such measures account the opening of new real estate development around relating to the mass rapid transit systems, e.g., extension the MRT routes, with the selling point of its location near the MRT of free public bus and train services of the Bangkok Mass routes, especially 6 stations passing across Asoke-Ratchada Transit Authority and the State Railway of Thailand, Road, e.g., Ratchadaphisek Station, Sutthisan Station, Huai respectively. However, given the growing traffic congestion, Khwang Station, Phra Ram 9 Station, Phetchaburi Station and some people choose the MRT service for its convenience, Sukhumvit Station. In 2013, there were new 13 condominium rapidity, reliability and punctuality. The negative effect on development projects accommodating approximately 6,300 price competition between the MRT system and public bus units, and one 300-room hotel development project. and train services tends to be rather slight. On the other hand, free public bus and train services help cause the costs In 2014, it is expected to have a total of new 20 real estate of feeder systems to the MRT service to be lower and open development projects to complete and open for service up more opportunity to use the MRT service. around the routes, consisting of 12 existing projects which were delayed from 2013 to 2014; and eight new projects to As for the political situation since November 2013 onwards, complete construction and open for service in 2014. It is several areas in Bangkok have been used as the political anticipated that seven projects will, once open for service, rally sites, which drew attention from a large number of give a positive effect on the volume of the MRT passengers, people in Bangkok and other provinces, such as, Democracy namely, five existing projects which were postponed from Monument, Victory Monument, , 2013 to 2014; and two new projects to complete construction Ratchaprasong Intersection, Pathumwan Intersection, and open for service in 2014. Lumpini Park, Asoke Intersection, Rama IX Intersection, etc. On the scheduled rally dates or major rally for Bangkok Most of the new real estate development projects around Shutdown, the volume of passengers on the MRT system the MRT routes in 2014 are residences located near Phra drastically increased, particularly the stations near the rally Ram 9 Station, Phetchaburi Station and Sukhumvit Station, sites, such as, Sukhumvit Station, Asoke Station, Phahon and once fully open, the volume of the MRT passengers in Yothin Station and Chatuchak Park Station. Phra Ram 9 Station, Phetchaburi Station and Sukhumvit Station will be clearly increasing. In addition, there are also Town Square Project and Suan Lum Night Bazaar Ratchada

Annual Report 2013 Bangkok Metro Public Company Limited 63 Progress of Development of the Mass Rapid Transit System in accordance with the Government’s Policy

Project Current Status of Project Red Line Bang Sue - Rang Sit, with a distance of 26.3 kilometres (North - South) - The State Railway of Thailand is proceeding with the following: Contract 1 Civil Work for Bang Sue Station and Depot, the SRT has executed the agreement for engagement of SU Joint Venture (Sino-Thai Engineering & Construction Public Company Limited and Unique Engineering and Construction Public Company Limited) on 18 January 2013; Contract 2 Civil Work for Bang Sue - Rang Sit Section, the SRT has executed the agreement for engagement of Italian-Thai Development Public Company Limited on 31 January 2013; Contract 3 M&E System, including supply of carriages, is pending the consideration of the SRT’s Board of Directors in respect of the interpretation and decision on issues regarding compliance with the Procurement Regulations. Light Red Line Bang Sue - Taling Chan, with a distance of 15.3 kilometres (West - East) - The State Railway of Thailand engaged Unique - Chun Wo Joint Venture to carry out the construction. The construction is 100% completed. - The project was opened for trial run during 8 September to 30 November 2012 for four trips per day (round trip) by diesel railcars in order to inspect the rail condition and systems relating to train operation. - It was opened for temporary service on 5 December 2012. Light Red Line Taling Chan - Siriraj, with a distance of 15.3 kilometres (West - East) - The State Railway of Thailand engaged TEAM Consulting Engineering and Management Co., Ltd. as consultant to survey, design and prepare the bidding documents for the Commuter Train System (Red Line) Project, Taling Chan - Siriraj Section, on 27 April 2012. The consultant started the service since 28 April 2012. - The consultant submitted an Interim Report on 26 July 2012 and held a public meeting No. 1 on 8 August 2012. - The consultant submitted the Final Report, together with bidding documents and EIA Report, on 24 October 2012. - It is pending the review and revision for completion. Purple Line Bang Yai - Bang Sue, with a distance of 23 kilometres (Bang Yai - - The civil work construction of the contractors of three Contracts, namely, Contract 1 (Tao Poon - Nonthaburi) operated Bang Sue) by CKTC; Contract 2 (Phra Nang Klao - Bang Yai) operated by STEC; and Contract 3 (Depot and Park & Ride Facilities) operated by PAR JV, progressed approximately 84.97% (as at 4 February 2014). - Bidding for Contract 4: The MRTA executed the Contract 4 with BMCL on 4 September 2013. - Contract 5: Railway M&E Works Tao Poon - Bang Sue Section, on 16 January 2013, the MRTA’s Board of Directors resolved to grant approval in principle for the MRTA to negotiate with the Company for acceptance of Contract 5 Works without any bidding process, which would need to submit the matter to the Ministry of Finance and the Council of Ministers for prior approval. - As for Contract 6: Trackwork, the MRTA executed the agreement for civil work construction, Contract 6 (Trackwork) with Italian-Thai Development Public Company Limited on 4 October 2012. Blue Line Bang Sue - Tha Phra and Hua Lamphong - Bang Khae, with a distance of 27 kilometres - The construction of the civil work by the contractor progressed approximately 28.18%, which was behind schedule by 53.19% (as at 4 February 2014). Green Line Mo Chit - Saphan Mai, with a distance of 11.9 kilometres - The design revision is completed and passes the EIA. It is pending submission to the Council of Ministers for bidding. The bidding documents are due for submission on 11 April 2014, with the project is scheduled to open for service in June 2017. Bearing - Samut Prakan, with a distance of 13 kilometres - The construction of the civil work by the contractor progressed approximately 4.72%, which was behind schedule by 22.58% (as at 4 February 2014). - The price proposal for Contract 2 (Trackwork) has been opened, in respect of which CH. Karnchang Public Company Limited proposed the lowest price. Light Green Line Wong Wien Yai - Bang Wa, with a distance of 5.3 kilometres - On 5 December 2012, BTS Silom Line Extension Project, - Bang Wa Section, has been opened for trial run for two stations, namely, Pho Nimit Station and Station. Taling Chan - Min Buri - The National Economic and Social Development Board (NESDB) has approved an investment project in Phase 1, Thailand Cultural Centre - Suwintawong Section. It is currently in the process of the environmental impact analysis (EIA), and, after new government is formed, the project is expected to be proposed to the new Council of Ministers for bidding in 2014. Sources : www.railway.co.th, www.mrta-purpleline.com, www.bts.co.th , www.bkkmrt.com and other sources collected by Bangkok Metro Public Company Limited

Annual Report 2013 64 Bangkok Metro Public Company Limited The Company’s policy on the provision of service for preparation period, costs of investment and costs of the extensions administration relatively lower than other operators. The Company, as a mass rapid transit rail service provider, b) Overview of Commercial Development and Competition intends to bid for the operation of the metro extensions in Advertising Media accordance with the government’s policy. The trend of advertising media industry in the past expanded in line with Thailand’s economic direction as they are As for the operation of the MRT Purple Line Extension, the interrelated, provided that there are no negative factors, such Council of Ministers resolved to grant approval for the private as, the global economy affecting Thailand’s economy, political sector to jointly invest in the MRT Purple Line Project on a uncertainty or unrest or natural peril. PPP Gross Cost basis, namely, the government sector shall invest in all civil work costs and the private sector shall invest Although the overall growth of the advertising industry has in the Railway Systems and rolling stock, including train substantially dropped, as a result of the declining growth of operation and maintenance. In this regard, the government various types of mainstream media, i.e., television, radio, shall be entitled to collect fare revenue and commercial newspapers, theatres, outdoor media, modern trade, the revenue from the use of all civil infrastructure and the M&E media with continued expansion is such media via the Systems and shall return the same to the private sector in Internet and on mass rapid transit systems, the costs of the form of service fees for train operation and maintenance which are relatively low as compared to mainstream media. and the M&E Systems and the M&E Systems Repayment. In addition, such media is easily accessible to target groups, On 3 September 2013, the Council of Ministers resolved to as most city people’s lifestyle spend much of their time grant approval for the MRTA to execute such Agreement outside and on travelling, therefore, advertisers or product with the Company, and the Company executed the owners are likely to allocate their advertising budget on Agreement with the MRTA on 4 September 2013. media which are more specifically accessible to target groups. The Company’s execution of the Agreement for the MRT Purple At present, advertising media has diversified and been Line Project, Bang Yai - Rat Burana, Bang Yai - Bang Sue developed to reach target groups faster. Each type of media Section, Contract 4: Concession for Supply of M&E Systems has its unique features and efficiency to communicate with and O&M Services (Khlong Bang Phai Station - Tao Poon consumers. Advertisements need to use cost-efficiently Station) with the MRTA will result in positive impacts on the mixed advertising media for specific purposes and desired Company in various aspects, namely, the Company will target groups. Therefore, competition in advertising media generate revenue from operation of the O&M Services of the industry not only relates to the same media types, but also MRT Purple Line Project in addition to its business operation of involves a diverse variety of media, as advertising budget the existing MRT Blue Line Project; and the execution of the will be allocated for the most efficient and effective media Concession Agreement for the MRT Purple Line Project for by advertising agencies or product owners. a concession period of 30 years will enable the Company to continue its ongoing business operation until 2042. In this regard, Given technology advancement and consumers’ changing the MRT Blue Line Project, Hua Lamphong - Bang Sue behaviors, advertising media tends to combine between Section, currently operated by the Company, will end in 2029. conventional media and new digital media, and develop to attract In addition, the MRT Purple Line Project connects to the consumers’ attention, in terms of creativity, uniqueness, MRT Blue Line Project at Tao Poon Station which will increase originality and catchy slogans and taglines to be the talk of the the number of passengers for the MRT Blue Line Project. The town in society. In addition, supporting media, such as, theatres, concession on a PPP Gross Cost basis will help reduce risks modern trade, Internet, has become more attractive to people. for the Company due to uncertainty of the number of passengers and revenue in the future, and enable the Company to clearly Space for Lease and Service calculate costs, risks and returns on investment. There are approximately 6,500,000 square metres of retail space available in Bangkok and its vicinity, and continuing to Since the Company has experience in this business both in expand. More than 50% of retail space in Bangkok and its terms of administration of train operations and signalling vicinity are located in the outskirts of Bangkok. Retail space system, and has the skilled team and personnel, facilities projects in Thailand comprise shopping centre, department and public utilities, including the Depot Building, Central store, super store mall, specialty store, entertainment complex, Control Centre, Administrative Building, to accommodate community mall and supporting retail space. Community malls the future extension projects, the Company intends to bid are considered the fast-growing number of retail space development for the administration of train operation and maintenance of projects in Bangkok; while rentals and lease rates are increasing the metro extensions under the government’s policy, approximately 5 - 10% from 2012, depending on locations of especially the Blue Line Extension, due to its advantage of retail space project.

Annual Report 2013 Bangkok Metro Public Company Limited 65 10. Mass Rapid Transit Master Plan in Bangkok Metropolitan Region

The government stated its policies to the Parliament on 23 August 2011 in respect of the policies on basic infrastructure, rail mass rapid transit system development, and logistics system and service management. Ten lines of the rail mass rapid transit projects in Bangkok Metropolitan Region would be accelerated to commence all construction works within four years (2011 - 2015). These projects, for a total distance of 410 kilometres, will be opened for service within 2019, with more extensions for a distance of 54 kilometres after 2019. Ten lines of the rail mass rapid transit projects, for a distance of 464 kilometres, comprise the routes and the responsible agencies, as follows:

Projects Distance Responsible (Km.) Routes Agencies 1. Red Line connecting the outskirt areas to Bangkok (Thammasat University, Rangsit Campus - Mahachai) 80.8 in the North - South line SRT 2. Light Red Line connecting the outskirt areas to Bangkok (Salaya - Hua Mak) 54 in the West - East line SRT 3. Airport Rail Link (Don Mueang Airport - Suvarnabhumi Airport) 50.3 connecting between the two airports SRT 4. Green Line connecting the North - East, around Phahon Yothin Road (Lam Luk Ka - Bang Pu) 66.5 and MRTA 5. Light Green Line (Yotse - Bang Wa) 15.5 under the responsibility of BMA BMA 6. Blue Line (Bang Sue - Hua Lamphong - Tha Phra - 55 connecting the Chaloem Ratchamongkhon Line to form MRTA Phutthamonthon Sai 4) a ring network to the inner areas of Bangkok 7. Purple Line (Bang Yai - Rat Burana) 42.8 main route connecting the North - South MRTA 8. Orange Line (Charan Sanit Wong - Min Buri) 32.5 main route connecting the East - West of Bangkok MRTA 9. connecting the North - East and Government Center (Khae Rai - Min Buri) 36 on Chaeng Wattana Road MRTA 10. (Lat Phrao - Sam Rong) 30.4 connecting and the East of Bangkok MRTA Total 464

Annual Report 2013 66 Bangkok Metro Public Company Limited Ten Lines of the Rail Mass Rapid Transit System Network for the Future

11. Risk Factors

11.1 Risks in the business operations of 11.1.2 Risks relating to commercial development revenue the Company and its Subsidiary Commercial development revenue, which represents approximately 16% of the total revenue of the Company 11.1.1 Risks relating to fare revenue and its Subsidiary, may vary depending upon the economic The Company’s fare revenue is the core revenue or representing condition, local political situations, competition in 83% of the total revenues. The growth of the fare revenue is advertising media and retail space lease business, thus essential to the Company’s results of operations, subject changes and amendment of laws and regulations to two variables, as follows: governing such business operations in the metro, as well • Passenger volume of the metro as the progress in opening of retail shops in the stations, The growth of the passenger volume of the underground several factors of which are beyond the Company’s control. mass transit system depends upon several factors including those beyond the Company’s control, such as, metro However, the Company developed new advertisement network expansion, good feeder systems, fare rates of media to increase its commercial development revenue, other available alternative transit systems, road traffic such as, advertisement media management via the congestion, oil prices, and real estate, condominium Passenger Information Display System (PIDs), platform business and business expansions surrounding the routes, billboard, etc., which started generating revenue in 2011. which would serve as people’s destinations. If the growth In 2014, the Company plans to increase digital advertisement of the passenger volume fails to meet the forecast, it will media, and maximize the use of space in stations. In impact the growth of the Company’s revenue. addition, the Company plans to develop retail space in five existing stations, namely, retail space in Sukhumvit However, the Company is confident in its potential in Station, Phahon Yothin Station, Chatuchak Park Station, providing the existing underground metro service Kamphaeng Phet Station and Phra Ram 9 Station, to connecting with other mass transit system network, such provide facilitation for passengers and to attract more as, BTS Skytrain, Suvarnabhumi Airport Rail Link, public customers. buses and connections between the underground metro 11.1.3 Risks relating to fluctuation of cost of fare system and the MRT Blue Line Extension and the MRT Purple Line in the future, as well as the rapid growth of Cost of fare is deemed to be the main expenditure of the real estate development projects surrounding the Company’s core business operation which comprises repair underground metro routes. and maintenance costs for the metro and civil infrastructure, public utility cost, and personnel cost. • Increase in fare rate Under the Concession Agreement, the maximum fare rate As for the maintenance costs under the M&E contract, with to be charged by the Company is determined in pursuance a long-term contract, the Euro-denominated payments were of a formula based on the Bangkok Non-Food Consumer adjusted based on the German Consumer Price Index, and Price Index, whereby the adjustment shall be made every Baht-denominated payments must be adjusted based on two years, and thus the change of fare rate impacts the the Bangkok Consumer Price Index, thereby exposing a risk growth of the Company’s revenue. to the Company due to changes in such price indices. However, the Company’s fare revenue continued to The public utility cost mainly comprises the cost of electricity increase at the average rate of 10% (2005 to 2013) as a used at stations and for train operations, whereby the cost result of the increase in the passenger volume and the of electricity may be adjusted according to the electricity fare rates, thereby giving rise to the Company’s improved rates of the Metropolitan Electricity Authority, which may results of operations accordingly, and fare revenue result in the Company’s increased cost. sufficient to cover the cost of fare since 2010.

Annual Report 2013 Bangkok Metro Public Company Limited 69 Therefore, the Company’s cost of fare varies according to in the maintenance agreement, the Company’s business the aforesaid costs. However, in the past, the Company operation may be affected. was able to effectively control its cost of fare. In 2013, the Company’s cost of fare amounted to Baht 1,315.62 million, According to the study of information from members in the which was decreased by 3.9% from 2012 due to the increased international federations of public transport operators, e.g., electricity rates. Besides, the cost of fare is mostly fixed UITP, APTA, NOVA Group of Metros, as well as learning cost, not varying directly according to the increased volume from Lloyd’s Register Rail, the Company’s highly experienced of passengers should there be no material change in the consultant, it is possible to select and procure the M&E volume of passengers to the extent that the Company is Equipment from other manufacturers of the equipment required to add the number of trains for service to enhance compatible with its existing system. In this regard, the the capacity to accommodate the passengers. Since 2011, Company has a policy to develop the quality of its personnel the Company executed a new civil infrastructure maintenance to have sufficient capabilities in working with local and contract (E&M contract) for repair and maintenance of M&E overseas equipment manufacturers and contractors in the Systems and trackwork system, by engaging external maintenance and repair of the M&E Equipment and the rail contractors with specific expertise or special equipment system to improve its efficiency without reliance on the sole only, and the Company would carry out certain other works, existing manufacturer. which would enable the Company to reduce the cost in this respect. 11.1.5 Risks from reliance on agencies’ purchase of the Subsidiary’s advertising media 11.1.4 Risks from engagement of Siemens as main In general, owners of core products and services, e.g., contractor for supply and maintenance of its M&E commodity, communication and telecommunications, auto Equipment industry and real estate sectors, have their agencies for The Company entered into an agreement for procurement planning and purchasing advertising media. Therefore, the of the M&E Equipment and an agreement for maintenance Subsidiary may be exposed to risk should major agencies of the M&E Equipment with Siemens AG, Germany, and not recommend those product and service owners to use Siemens Limited, Thailand, until 2014. Thus, in the event the Subsidiary’s advertising media. However, the Subsidiary where such Siemens group is unable to provide services has developed and improved its advertising media to ensure under the agreement to the Company or there is any change a variety of sizes and creativity, in response to the demand

Annual Report 2013 70 Bangkok Metro Public Company Limited of all target product and service owners who rely on their to the Company. Thus, the Company shall not be liable for agencies’ planning and purchase of the advertising media, any further expenses in case of project cost overrun for the as well as advertisers as the product and service owners. Works during Phase 1 of the Contract.

11.1.6 Risks on the MRT Purple Line Project, Bang b) Risk from financing for the Works during Phase 1 of the Yai - Rat Burana, Bang Yai - Bang Sue Section, Contract Contract 4: Concession for Supply of M&E Systems The Concession Agreement requires the Company as the and O&M Services (Khlong Bang Phai Station - Tao concessionaire to finance the Works during Phase 1 of Poon Station) the Contract, whereby the Company shall secure the a) Risk from completion of the Works during Phase 1 of the source of financing within 60 days from the execution date Contract within the specified time and costs of the Concession Agreement with the MRTA. Therefore, The Concession Agreement (1) requires the Company to should the Company fail to secure the source of financing, complete the Works during Phase 1 of the Contract within the Completion Period and the amount of financing for 1,200 days from the execution date and if the Company the Works during Phase 1 of the Company may be affected. fails to complete such works within the specified time provided The Company then sets out a risk management policy that such delay is not caused by force majeure and/or fault through engagement of CH. Karnchang Public Company on the part of the MRTA, the Company shall have the duty Limited which is responsible for performance of the Works to pay a fine to the MRTA at the rate as specified in the during Phase 1 of the Contract to secure the source of Concession Agreement; and (2) sets out the value of the financing by itself for the Works during Phase 1 of the Works during Phase 1 of the Contract in the amount of not Contract, whereby the Company shall determine the exceeding Baht 20,011 million (including finance costs, but amount and schedule for repayment of the M&E Systems excluding value added tax), which may be adjusted by the and financing costs to CH. Karnchang Public Company actual loan drawdown and change in interest rates and Limited to ensure consistency with the amount and financial fees. Therefore, should in the future, the actual schedule of payment to be received by the Company from value of the equipment and the M&E Systems differ from the MRTA. Such arrangement shall in no way place any that specified in the Agreement, the Company may be burden on the Company to secure the source of financing exposed to the cost overrun risk in respect of the investment for the M&E Systems since CH. Karnchang Public value of the Works during Phase 1 of the Contract. Company Limited is authorized to make arrangement on its behalf or any burden to secure the source of financing The supply, installation and testing of the M&E Systems as for repayment to CH. Karnchang Public Company Limited specified in the Works during Phase 1 of the Contract of the since the Company will use cash flow received from the Concession Agreement mainly relate to the mechanical and MRTA for repayment to CH. Karnchang Public Company electrical systems, with the target completion period and Limited based on the same amount and schedule. fixed investment costs. Therefore, the Company sets out a policy to manage such risk by way of execution of an c) Risk from cost overrun for the O&M Services agreement for engagement of CH. Karnchang Public In the Concession Agreement, the service fees for the O&M Company Limited with expertise and experience in the Services payable by the MRTA to the Company are foregoing arrangements to serve as the project manager on calculated and based on the projections of operating a turnkey basis, as well as financing (Engineering, expenses estimated by the Company, whereby such service Procurement and Construction Contract), which will shift fees may be adjusted based on the actual inflation rate and such risks to CH. Karnchang Public Company Limited, electricity charge rate under the method specified in the whereby the scope of works, timeframe and values of works Concession Agreement. Therefore, profits from the shall be specified to ensure consistency with the conditions Operation Service will vary according to the Company’s as specified in the Concession Agreement, and fines shall ability to manage the actual costs and expenses as close be imposed on CH. Karnchang Public Company Limited for to the specified projections. Should the actual costs and any delay in order to prevent any impact upon the Company expenses be different from the projections, the Company’s in case of project completion delay and help minimize risks operational results may be affected in the case that the

Annual Report 2013 Bangkok Metro Public Company Limited 71 Company is not able to request compensation or increase Station. However, every MRT station remained open for the service fees from the MRTA. However, with the expertise normal service as the Company had prepared action plans and experience in management of the Blue Line Project, to cope with such emergency so as to provide service to the Company is confident in its ability to efficiently manage ensure the maximum safety and to prevent and mitigate costs and expenses for operations as close to the possible damage to the MRT property. projections. In addition, the civil infrastructure of the MRT system is designed to prevent floodwater up to 3.5 metres above sea 11.1.7 Risks from terrorism level, whereby the design level of the entrance-exit staircases The Company has a risk from terrorist attacks and political of stations is at 2 metres above sea level. The flood prevention unrest. If such event occurs, it thus affects the Company’s equipment (Stop Log or Flood Board) has been installed, business operation. For instance, the political unrest in with a height of 1.5 metres, on the entrance-exit staircases May 2010 did cause the Company to suspend its train of stations, as an additional measure to prevent flooding. operation service for eight days, during which, the Company In this regard, the structure inside each station is designed lost the fare revenue and certain property was damaged. for drainage ditch, in case of water leakage from outside into the station and the tunnel, water will flow to the However, the Company has taken out terrorism insurance, designated water tanks, and after that the water pump will which the Company would be compensated in the insurance drain the water out of the system. The Operation Control coverage amount, after the Company’s responsibility for Centre can monitor the operating status of the water pump the deductible. Besides, the Company has implemented and any unusually high water level in the water tanks, which measures to prevent a variety of such incidents in order to will be alarmed via the SCADA system. mitigate possible impact, for instance, emergency drills of all relevant units inside and outside the Company by way 11.1.9 Risks relating to the Concession Agreement of simulation of such various situations as emergency in and the government supervision the stations from bomb threat and bomb blast in the stations, Given that the Company operates its businesses in trains out of order and stopping inside the tunnel, fire in the accordance with the Concession Agreement under the rolling stock, stations or tunnel, etc. In addition, the supervision of the MRTA, differences in the contractual Company has also strictly implemented security measures parties’ interpretations on terms and conditions of the by having closed-circuit televisions installed to ensure safety Concession Agreement may arise. Should the Company for passengers and having security officers stand at the and the MRTA be unable to resolve any problem, the escalator checkpoints prior to entering stations to check Company may require a certain period of time to come to passengers’ belongings. Furthermore, the Walk Through a solution, which would impact the Company’s business Metal Detector has been installed in every entrance/exit of operation. the stations to search for explosive and deadly weapon, and various teams of security officers comprising dedicated 11.1.10 Risks relating to the government policy in the teams stationed at metro stations, at parking buildings, a K-9 construction and operation of the mass transit railway search team, an explosive ordinance disposal team, as well system as arranging for rescue teams ready for rescue operations Every government has a policy to expand the mass transit in unusual circumstances. railway system to cover the Bangkok Metropolitan area and its surrounding provinces since such projects will help 11.1.8 Risks from natural disasters stimulate the economy and result in expansion of related At present, the global geographic shifts and climate change businesses, such as, construction and real property sectors, results in severe natural disasters or catastrophe, such as, as well as solving problems on the mass transit system. earthquake or flooding, like the flood crisis in October and The current government, by the Office of Transport and November 2011 which occurred in several provinces of Traffic Policy and Planning (OTP), Ministry of Transport, Thailand, including Bangkok, and flood the entrance-exit of has continued to accelerate 10 routes (464 kilometres) of four MRT stations, namely, Ratchadaphisek Station, Lat the rail mass rapid transit projects in Bangkok Metropolitan Phrao Station, Phahon Yothin Station and Chatuchak Park Region.

Annual Report 2013 72 Bangkok Metro Public Company Limited However, there are factors which may give rise to an impact in the initial operation, the Company then continues to sustain on the implementation under the government’s plan and delay an operating loss in the initial period of the service in the MRT network expansion. The Company’s growth commencement year. On 31 December 2013, the Company has been in part a result of the increased volume of continues to sustain an accumulated operating loss in the passengers from the extensions and the new lines of the amount of Baht 12,786 million, therefore, the Company is mass transit system. Therefore, any delay by the government not able to pay dividend in the forthcoming year. In this would affect the Company’s growth rate accordingly. regard, the payment of dividend depends on several factors, namely, result of operations, investment plan, adequacy of 11.1.11 Risks from free trade and ASEAN Economic cash flow, conditions of the loan agreement, necessities, Community (AEC) and others factors. The full entry into ASEAN Economic Community in 2015, which is a regional economic cooperation of the Association 11.2.2 Risks from the interest rate and foreign of Southeast Asian Nations or 10 ASEAN countries, will exchange rate fluctuations result in the free transfer of resources, capitals, labors and As at 31 December 2013, the Company had long-term loans free trade in ASEAN markets, particularly labor. In this totalling Baht 10,739.50 million, the full amount of which regard, skilled labors will be transferred to work in the member was extended by domestic banks, at the interest rate of countries more easily. The Mutual Recognition Arrangements MLR plus 0.25% per annum. Therefore, if the interest rates (MRAs) have been made in respect of qualifications for main increase, the Company’s interest expense obligation would professionals, in order to facilitate the free transfer of be affected in the future. professionals or skilled labors, initially, covering eight professions, namely, engineering services, nursing services, The Company incurred expenses in foreign currencies for architectural services, surveying qualifications, accountancy the maintenance cost of the M&E Equipment, in an average services, dental practitioners, medical practitioners and amount of approximately Euro 2 million per year. In addition, tourism. Upon more transfer of skilled labors, executives, the Company had insurance premiums of approximately technical specialists or experts from one ASEAN member US$ 2.4 million per year. Thus, should the Baht value country to another for any reason, such as, pay rate, welfare depreciate, the Company’s expenses would increase or living better than in Thailand, the “brain drain” condition accordingly. However, the proportion of the expenses in would occur. As for the Company, the professions which foreign currencies was low merely at approximately 7% of will be directly affected are engineering services and the total revenue (based on the exchange rate of the Bank accountancy services, therefore, good and attractive welfare of Thailand as at 27 December 2013). and remuneration should be considered, in order to restrain the flow of such labors. In addition, the Company also 11.2.3 Risks relating to the Company’s major shareholders participates in labor development with the government sector, with more than 25% of all voting rights via the government and private sector network, whereby After the Right Offering of capital increase shares to the the Company executed the Memorandum of Understanding existing shareholders during 9 - 16 December 2013, CH. on “Network for Development of Manpower and Expertise Karnchang Public Company Limited then holds more shares on Technology in respect of the Railway Transit System of in the Company, representing 30.19% of all voting rights, Thailand” with 19 networks of both government and private which is more than 25% of all voting rights of the Company, sectors. and as a result, CH. Karnchang Public Company Limited may exercise its right to object or disagree on any special 11.2 Other risks and/or important agenda of the Company which requires 11.2.1 Risks from the Company’s substantial not less than three-fourths of all votes of the shareholders accumulated loss and inability to pay dividend in the attending the meeting and having the voting right. This forthcoming period might prevent such special and/or important agenda from Investments in large-sized projects require a large amount obtaining the approval of the shareholders’ meeting. of investment and also require working capital continuously

Annual Report 2013 Bangkok Metro Public Company Limited 73

12. Capital Structure

12.1 Securities of the Company As at 31 December 2013, the Company has the registered capital of Baht 20,500 million, divided into 20,500 million ordinary shares, with par value of Baht 1 each, as well as issued and paid-up capital of Baht 20,500 million. 12.2 Shareholders of the Company The table below shows the top ten shareholders of the Company as at 13 January 2014.

Name Number of Shares (shares) Percentage 1. CH. Karnchang Public Company Limited 1/ 6,188,312,416 30.19 2. Mass Rapid Transit Authority of Thailand 2/ 2,987,500,000 14.57 3. Bangkok Expressway Public Company Limited 3/ 2,050,134,895 10.00 4. Hicrete Products & Technology Co., Ltd. 1,810,521,518 8.83 5. Krung Thai Bank Public Company Limited 1,697,453,863 8.28 6. TMB Bank Public Company Limited 661,613,256 3.23 7. Bank of Ayudhya Public Company Limited 516,885,356 2.52 8. UOB Kay Hian (Hong Kong) Limited - Client A/C 474,206,000 2.31 9. Syntec Construction Public Company Limited 242,764,458 1.18 10. Thanachart Bank Public Company Limited 206,754,143 1.01

Remarks: 1/ It operates the general construction business. The Trivisvavet Family holds shares representing 39.75% of the paid-up capital (as at 19 September 2013), with details as follows: Trivisvavet Family Number of Shares % of Paid-up Capital 1. Mahasiri Siam Co., Ltd. 332,109,625 20.10 2. CH. Karnchang Holding Co., Ltd. 171,216,127 10.36 3. CK. Office Tower Co., Ltd. 91,071,427 5.51 4. Mr. Plew Trivisvavet 20,170,136 1.22 5. Bang Pa-in Land Development Co., Ltd. 17,692,500 1.07 6. Mrs. Sopida Trivisvavet 13,678,200 0.83 7. Mr. Prasert Trivisvavet 10,902,400 0.66 8. Mr. Kamthorn Trivisvavet 71,000 0.004 Shareholders may refer to further details of CH. Karnchang Public Company Limited in the Annual Registration Statement (Form 56-1) on the Office of the SEC’s website (www.sec.or.th) or the Stock Exchange of Thailand’s website (www.set.or.th). 2/ The Mass Rapid Transit Authority of Thailand (“MRTA”) is a state enterprise under the Ministry of Transport, established by virtue of the Mass Rapid Transit Authority of Thailand Act B.E. 2543 (2000), with its objectives for management of the mass transit system in Bangkok and its sur- rounding provinces. 3/ It operates the investment business in the Expressway System Projects. CH. Karnchang Public Company Limited holds shares representing 15.15% of its paid-up capital (as at 12 September 2013). Shareholders may refer to further details of Bangkok Expressway Public Company Limited in the Annual Registration Statement (Form 56-1) on the Office of the SEC’s website (www.sec.or.th) or the Stock Exchange of Thailand’s website (www.set.or.th). 12.3 Dividend Policy The Board of Directors of the Company has a policy to pay dividends at the rate of approximately 40% of its net profits after deduction of all reserves as required by law and as required under the Onshore Facilities Agreement, in particular after reserving funds for the repayment of the principal and interest for a period of six months. As the Company has incurred losses during the initial years of revenue service and has had accumulated losses, it is thus not able to pay dividends to its shareholders. The Company’s Subsidiary has a policy to pay dividends at the rate of approximately 40% of net profits after deduction of all reserves as required by law and pursuant to the Onshore Facilities Agreement. The Board of Directors of the Company will consider and propose the dividend payments to the Subsidiary’s board of directors for consideration and further submission to its shareholders’ meeting for approval, subject to the Subsidiary’s investment plans, requirements and other justifications which its board of directors deem appropriate.

Annual Report 2013 Bangkok Metro Public Company Limited 75

13. Management Structure

13.1 Board of Directors As at 31 December 2013, the Board of Directors of the Company comprised 11 directors as follows:

Name Position First/Most Recent Appointment Date

1. Mr. Plew Trivisvavet Chairman of the Board of Directors 11 May 2004 / 2011 Annual Ordinary General Meeting of Shareholders 2. Mr. Supong Chayutsahakij Vice Chairman of the Board of Directors 11 May 2004 / 2013 Annual Ordinary General Meeting of Shareholders 3. General Chetta Thanajaro Chairman of the Audit Committee 29 April 2005/ and Independent Director 2012 Annual Ordinary General Meeting of Shareholders 4. Mr. Vitoon Tejatussanasoontorn /1 Audit Committee Member 29 April 2005 / and Independent Director 2012 Annual Ordinary General Meeting of Shareholders 5. Lieutenant General Surat Sumrith Audit Committee Member 29 April 2005 / and Independent Director 2013 Annual Ordinary General Meeting of Shareholders 6. Mrs. Vallapa Assakul Independent Director 27 March 2009 / 2012 Annual Ordinary General Meeting of Shareholders 7. Dr. Sombat Kitjalaksana Director 11 May 2004 / 2011 Annual Ordinary General Meeting of Shareholders 8. Mrs. Kritaya Sumitanant Director 9 May 2012 / 2013 Annual Ordinary General Meeting of Shareholders 9. Miss Dachanee Euarchukiat Director 9 May 2012 / 2013 Annual Ordinary General Meeting of Shareholders 10. Mr. Werapong Suppasedsak Director 12 October 2012

11. Mr. Chaiwat Utaiwan Director 14 October 2011 / 2012 Annual Ordinary General Meeting of Shareholders

Note 1/ The Audit Committee member who has adequate knowledge and experience to review the reliability of the financial statements.

Annual Report 2013 Bangkok Metro Public Company Limited 77 Authorized Signatory Directors been a shareholder or controlling person of those who The Company’s authorized signatory directors are two of the have business relationship with the Company, parent following four persons, namely, Mr. Plew Trivisvavet, Mr. Supong company, subsidiary, affiliated companies, major Chayutsahakij, Mr. Sombat Kitjalaksana, and Mr. Chaiwat shareholder or controlling person of the Company, unless Utaiwan, jointly sign and affix the Company’s seal. such prohibited characteristic has ended not less than two years prior to appointment. The aforesaid business Independent Directors relationship includes any transaction in the ordinary course The Board of Directors of the Company currently comprises of business, rental or lease of immovable property, four independent directors or representing one-third of the transaction relating to assets or services, or provision total number of directors of the Company. The Company or acceptance of financial assistance through receiving specifies the qualifications of its independent directors in or extending loans, guarantee, providing assets as compliance with the notification of the Office of the Securities collateral, including any other similar actions, which cause and Exchange Commission and the Stock Exchange of the Company or its contractual party to be subject to Thailand, as follows: indebtedness payable to the other party in the amount of three percent or more of the net tangible assets of the Qualifications of the Independent Director Company or Baht twenty million or more, whichever is 1 Holding shares not exceeding one percent of the total lower. Such indebtedness shall be calculated according number of shares having voting rights of the Company, to the calculation method of connected transaction value parent company, subsidiary, affiliated companies, major under the Notification of the Capital Market Supervisory shareholder or controlling person of the Company, including Board, Re: Rules on Connected Transactions, mutatis the shares held by related persons; mutandis. However, the consideration of such indebtedness 2. Neither being nor having been a director having involvement shall include the indebtedness incurred during the course in the management, employee, staff, advisor receiving of one year prior to commencement of business relationship regular salary or controlling person of the Company, its with any of such person; parent company, subsidiary, affiliated companies, subsidiary 5. Neither being nor having been an auditor of the Company, at the same level, major shareholder or controlling person of parent company, subsidiary, affiliated companies, major the Company, unless such prohibited characteristic has shareholder or controlling person of the Company, and ended not less than two years prior to appointment, not being a shareholder, controlling person or partner of except where such independent director was a public the audit firm which employs auditor of the Company, servant or an advisor of the government sector, as major parent company, subsidiary, affiliated companies, major shareholder or controlling person of the Company; shareholder or controlling person of the Company, unless 3. Not being a person having relationship by blood or by such prohibited characteristic has ended not less than registration under laws in the capacity as parent, spouse, two years prior to appointment; sibling and offspring, including spouse of the offspring of 6. Neither being nor having been any professional service any executive, major shareholder, controlling person or provider, including legal advisor or financial advisor nominated person to be an executive or controlling person receiving fee more than Baht two million per year from of the Company or subsidiary; the Company, its parent company, subsidiary, affiliated 4. Having no or having business relationship with the Company, companies, major shareholder or controlling person of parent company, subsidiary, affiliated companies, major the Company, and not being a shareholder, controlling shareholder or controlling person of the Company in the person or partner of such professional service provider, manner which may obstruct the exercise of his/her unless such prohibited characteristic has ended not less independent discretion, and neither being nor having than two years prior to appointment;

Annual Report 2013 78 Bangkok Metro Public Company Limited 7. Not being a director appointed of the same nature as representative of the Company’s directors, major shareholder or shareholders who are related persons of any major shareholder; 8. Not operating a business as and in competition with the business of the Company or subsidiary, or not being a partner, or being a director having involvement in the management, employee, staff, advisor receiving regular salary or holding shares exceeding one percent of the total number of shares having voting rights of other companies which operate a business of the same nature as and in competition with the business of the Company or subsidiary; 9. Having no other characteristics which prevent the provision of independent opinion regarding the Company’s business operations. Attendances of the Board of Directors’ Meetings The Board of Directors shall regularly meet at least every quarter. In 2013, each director’s attendances of the meetings were reported as follows:

Board of Directors’ Meetings Name Position Number of Number of Meetings Attendances 1. Mr. Plew Trivisvavet Chairman of the Board of Directors 5 5 2. Mr. Supong Chayutsahakij Vice Chairman of the Board of Directors 5 5 3. General Chetta Thanajaro Chairman of the Audit Committee and Independent Director 5 4 4. Mr. Vitoon Tejatussanasoontorn Audit Committee Member and Independent Director 5 5 5. Lieutenant General Surat Sumrith Audit Committee Member and Independent Director 5 5 6. Mrs. Vallapa Assakul Independent Director 5 5 7. Dr. Sombat Kitjalaksana Director 5 5 8. Mrs. Kritaya Sumitanant Director 5 5 9. Miss Dachanee Euarchukiat Director 5 5 10. Mr. Werapong Suppasedsak Director 5 5 11. Mr. Chaiwat Utaiwan Director 5 5

13.2 Management Team As at 31 December 2013, the Management Team of the Company comprised four members as follows:

Name Position 1. Mr. Chaiwat Utaiwan President and Acting Executive Vice President, Management Group 2. Mr. Witoon Hatairatana Executive Vice President, Operations Group 3. Mr. Visuit Boreriboon Executive Vice President, Marketing Group 4. Miss Veena Tachachainirun Executive Vice President, Finance Group

Note : The Company restructured its corporate organisation and appointed the Management Team under the resolution of the Board of Directors’ Meeting No. 2/2012, held on 3 April 2012.

Annual Report 2013 Bangkok Metro Public Company Limited 79 Management Structure

Board of Directors

Corporate Secretary Nomination & Remuneration Committee Audit Committee Risk Committee

Executive Committee Manager, Safety and Quality Manager, Office of the Department Internal Audit President

Executive Vice President, Executive Vice President, Executive Vice President, Executive Vice President, Operations Group Finance Group Marketing Group Management Group

Vice President Vice President Train Operations Division Accounting and Finance Division Vice President Marketing and Commercial Vice President Development Division Engineering and Vice President Vice President Maintenance Division Business Development Administration and Information Division Vice President Technology Division Public Relations and Vice President Corporate Affairs Division Project Management Vice President Division Office of the President

Vice President Office of the Human Resources Note : Company’s executives under the Notification of the SEC refer to President and Executive Vice Presidents. As at December 31, 2013

Annual Report 2013 80 Bangkok Metro Public Company Limited 13.3 Corporate Secretary meetings of board of directors; 4. Providing initial advice and suggestions to the Board of The Board of Directors’ Meeting No. 3/2008 held on 11 August Directors in respect of legal matters, regulations and 2008 passed the resolution to appoint Miss Sutida Sangpruek- practices for corporate governance; sa, Vice President Office of the President as the Corporate 5. Ensuring disclosures and information memoranda under Secretary, effective from 12 August 2008 onwards, with duties the responsibility to the regulators unit in accordance and responsibilities as described in the Securities and Exchange with the laws and relevant regulations; Act (No. 4) B.E. 2551 (2008) as follows: 6. Arranging for orientation for newly appointed directors; 1. Preparing and keeping the following documents: 7. Performing any other acts as specified in the notification a) The register of directors; of the Capital Market Supervisory Board. b) The notice calling directors’ meetings, minutes of meetings of the Board of Directors and annual report of Miss Sutida Sangprueksa, the Corporate Secretary, graduated the Company; in accounting and obtained the Corporate Secretary Program c) The notice calling shareholders’ meetings and minutes Certificate from the Thai Institute of Directors. Profile of the of shareholders’ meetings; Corporate Secretary is described in Attachment 1 to the 2. Keeping reports on interests filed by directors or Annual Registration Statement (Form 56-1) of the Company. magagement. 3. Arranging for and conducting shareholders’ meetings and

Annual Report 2013 Bangkok Metro Public Company Limited 81 13.4 Remuneration of Directors and Management 13.4.1 Cash Remuneration Remuneration of directors comprises monthly remuneration and meeting allowance, whereby remuneration of subcommittees of the Company shall be approved by the shareholders’ meeting while remuneration of President and Executive Vice Presidents shall be approved by the Board of Directors and the Executive Committee, respectively. Remuneration of Directors of the Company (Only remuneration as directors and members of the Audit Committee)

Name of Director 2013 Remuneration Amount (Baht) Meeting Allowance Monthly Total 1. Mr. Plew Trivisvavet - - /1 - 2. Mr. Supong Chayutsahakij 25,000 - /1 25,000 3. General Chetta Thanajaro As Director 20,000 - As Chairman of the Audit Committee 20,000 600,000 640,000 4. Mr. Vitoon Tejatussanasoontorn As Director 25,000 - As Audit Committee Member 25,000 360,000 410,000 5. Lieutenant General Surat Sumrith As Director 25,000 - As Audit Committee Member 25,000 360,000 410,000 6. Mrs. Vallapa Assakul 25,000 240,000 265,000 7. Dr. Sombat Kitjalaksana 25,000 - /1 25,000 8. Mrs. Kritaya Sumitanant 25,000 240,000 265,000 9. Mr. Dachanee Euarchukiat 25,000 240,000 265,000 10. Mr. Werapong Suppasedsak 25,000 240,000 265,000 11. Mr. Chaiwat Utaiwan 25,000 - /1 25,000 TOTAL 315,000 2,280,000 2,595,000

Notes : /1 Remuneration was presented in the caption Total Remuneration of the Executive Committee and Management. - Any director holding office in several committees shall receive only monthly remuneration for office with the highest remuneration. - Meeting allowance shall be provided only for the Board of Directors’ Meetings and the Audit Committee’s Meetings, and only for the meetings attended. - No remuneration was set for the Nomination and Remuneration Committee and the Risk Committee.

Annual Report 2013 82 Bangkok Metro Public Company Limited Total Remuneration of the Executive Committee and Management

2013 Name Number of Persons Amount Nature of (Million Baht) Remuneration Total remuneration for Executive Committee 3/1 1.32/1 monthly Total remuneration for Management 4/2 23.42 salary, bonus, contributions to the provident fund and social security fund

TOTAL 6/3 24.74

Notes /1 The Chairman of the Executive Committee expressed his intention not to receive remuneration for 2013. /2 The Company restructured its corporate organization since 4 April 2012, whereby the definition of “Management” was changed from Managing Director and Directors to President and Executive Vice Presidents. /3Mr. Chaiwat Utaiwan served as Executive Committee Member and Management.

13.4.2 Other Remuneration Other Remuneration of Directors and Management 1. Employee Stock Options (ESOP) On 30 June 2005, the Extraordinary General Meeting of Shareholders No. 1/2005 resolved to issue and offer 450,000,000 new capital increase shares to the directors, management and staff of the Company (at the par value of Baht 1 each) and the Board of the Directors was authorised to allocate these shares. During 26 - 28 December 2005, 296,689,300 shares were allocated to the directors, management and staff of the Company. The shares so allocated to the directors, management and staff will be subject to a silent period for 2 years from the date the Company’s shares started trading on the Stock Exchange of Thailand. The directors, management and staff will be permitted to sell up to 50% of the locked-up shares every 12 months and 24 months thereafter from the date the Company’s shares started trading on the Stock Exchange of Thailand (21 September 2006). 2. Other remuneration of directors - None -

Annual Report 2013 Bangkok Metro Public Company Limited 83 Number of Shares in Bangkok Metro Public Company Limited held by the Directors and Management

Number of Shares Number of Shares Net Purchase/ Percentage of Name of Director and Management Held /1 (shares) Held /1 (shares) (Sale) Shareholding (%) 31 December 2012 31 December 2013 During Year 31 December 2013 1. Mr. Plew Trivisvavet 33,056,350/2 56,620,937/2 23,564,587 0.28 2. Mr. Supong Chayutsahakij 15,000,000 8,000,000 (7,000,000) 0.04 3. General Chetta Thanajaro 5,000,000 5,000,000 - 0.02 4. Mr. Vitoon Tejatussanasoontorn 15,000,000 7,000,000 (8,000,000) 0.03 5. Lieutenant General Surat Sumrith 9,000,000 5,500,000 (3,500,000) 0.03 6. Mrs. Vallapa Assakul/3 6,000,000 500,000 (5,500,000) 0.002 7. Dr. Sombat Kitjalaksana 5,000,000 5,000,000 - 0.02 8. Mrs. Kritaya Sumitanant /4 - - - - 9. Miss Dachanee Euarchukiat /4 - - - - 10. Mr. Werapong Suppasedsak /4 - - - - 11. Mr. Chaiwat Utaiwan/4 - - - - 12. Mr. Witoon Hatairatana 5,000,000 5,000,000 - 0.02 13. Mr. Visuit Boreriboon /5 - - - - 14. Miss Veena Tachachainirun /5 - - - -

Notes : /1 This includes shares held by their respective spouses and minor children. /2 This represents 20,000,000 ESOP shares and 13,006,250 shares repurchased from staff who resigned during December 2005 – December 2008. Such arrangements were made in accordance with the criteria for ESOP issuance and offering. /3 Served as director on 26 May 2005 and resigned as director on 11 April 2007 and reinstated as director on 27 March 2009. /4 Served as director after ESOP. /5 Served as executive after ESOP.

Other Remuneration of Management The Company establishes a provident fund for its management, whereby the Company shall remit contribution at the rate of five percent of their salary. In 2013, the Company paid the provident fund contributions for four executives in the total amount of Baht 0.95 million.

Annual Report 2013 84 Bangkok Metro Public Company Limited 13.5 Personnel Significant Labour Dispute over the Past Three Years None Total Number of Staff Staff Development Policy The Company’s total staff is 1,089 persons. In 2013, the The Company establishes a policy on nomination, development Company paid remuneration for its staff in the total amount and retention of personnel of the Company by means of of Baht 473.41 million, comprising salary, incentives, provision of remuneration in the form of salary, welfares, provident fund contributions, welfares, allowances and and other remuneration which can be competitive in the overtime, etc. Moreover, the Company’s Subsidiary paid same industry. In this regard, the Company regards its staff remuneration for its staff in the same manner as the as valuable resources, that is, human resources are one of Company in the total amount of Baht 43.15 Million. the major factors to the Company’s development and As at 31 December 2013, the Company had its staff in each competitiveness as well as achievement of the Company’s primary line (exclusive of management) as follows: objectives. The Company realises the significance of development and improvement of internal personnel by way of regular Number of Staff personnel training and performance review, including local Primary Line and overseas study visits and training, particularly the (persons) awareness and training in respect of service safety. The Operations Group 901 Company’s staff must strictly comply with the Company’s Marketing Group 38 safety rules as well as the safety rules of Thailand, Finance Group 29 including international standards of the world-class leading Management Group 97 mass transit rail system. Furthermore, the Company Office of the Internal Audit 4 arranges for the efficient personnel management system Safety and Quality Department 20 based on fairness, equality and opportunity for staff Total 1,089 development and exercise of competency at full capacity. As at 31 December 2013, the Subsidiary had its staff in The Company gives priority to morale and a sense of pride each division (exclusive of management) as follows: in work performance of staff by determining remuneration and career advancement based on knowledge, competency Number of Staff Division and fairness, as well as reasonable welfare system, together (persons) with development of staff lifestyle in order to retain the Marketing and Business Development 36 Company’s valuable human resources. Finance and Administration Affairs 25 Operations 36 In 2013, the Company incurred actual expenses for personnel Total 97 development training, both in Thailand and overseas, in the amount of approximately Baht 1.23 million. In 2014, the Company determines its budget for personnel development Significant Change in Number of Staff over the Past Three training, both in Thailand and overseas, in the amount of Years approximately Baht 2.68 million. None

Annual Report 2013 Bangkok Metro Public Company Limited 85 14. Corporate Governance

The Company has adhered to the good corporate governance guidelines in accordance with the current good corporate principles for management by always taking into account governance principles for listed companies, which contains the significance of and responsibilities toward shareholders the following five categories of the significant principles and and stakeholders of the Company through our commitment, practices: dedication and the concerted efforts of all divisions, starting Chapter 1 Rights of Shareholders from the Board of Directors, Management Team and all staff. Chapter 2 Equitable Treatment of Shareholders Chapter 3 Role of Stakeholders 14.1 Corporate Governance Policy Chapter 4 Disclosure and Transparency The Board of Directors of the Company realises the Chapter 5 Responsibilities of the Board significance of compliance with the good corporate 14.2 The Board governance principles in the interest of transparency in management and responsibilities of the Board of Directors The board structure of the Company comprises five and Management Team, and increasing the confidence of committees, namely, the Board of Directors, the Audit shareholders, investors and all related parties. The Company Committee, the Executive Committee, the Nomination and thus sets out the good corporate governance policy and Remuneration Committee, and the Risk Committee, with the scope of powers and duties of each committee as follows: A. Board of Directors As at 31 December 2013, the Board of Directors of the Company comprised 11 directors as follows:

Name Position 1. Mr. Plew Trivisvavet Chairman of the Board of Directors 2. Mr. Supong Chayutsahakij Vice Chairman of the Board of Directors 3. General Chetta Thanajaro Chairman of the Audit Committee and Independent Director 4. Mr. Vitoon Tejatussanasoontorn /1 Audit Committee Member and Independent Director 5. Lieutenant General Surat Sumrith Audit Committee Member and Independent Director 6. Mrs. Vallapa Assakul Independent Director 7. Dr. Sombat Kitjalaksana Director 8. Mrs. Kritaya Sumitanant Director 9. Miss Dachanee Euarchukiat Director 10. Mr. Werapong Suppasedsak Director 11. Mr. Chaiwat Utaiwan Director

Notes /1 The Audit Committee member who has adequate knowledge and experience to review the reliability of the financial statements.

Annual Report 2013 86 Bangkok Metro Public Company Limited Roles and Duties of the Board of Directors of Directors of the Company may cancel, revoke, change (1) to supervise, monitor and manage the Company’s or amend such authorities as appropriate; operations to ensure compliance with laws as well as (9) to consider the appointment of the authorised signatory the objectives and the Articles of Association of the directors of the Company, including the appointment Company and resolutions of the Company’s meetings of sub-committees as may be necessary and appropriate of shareholders and to protect the interests of the to operate the Company; Company, based on principles of good corporate (10) to consider and clearly specify the division of roles, duties and governance as well as the rules and notifications of the responsibilities among the Company’s Board of Directors, Stock Exchange of Thailand and the Office of the sub-committees and the management, including specifying Securities and Exchange Commission; the procedures and regularly communicating such roles, duties (2) to set policies and strategies of the Company and to and responsibilities to directors, sub-committee members, the supervise, control and monitor to ensure that the management and staff of the Company; management performs in compliance with such policies (11) to supervise and monitor the Executive Committee to in an efficient and effective manner to give rise to the ensure compliance with the policies specified by the maximum economic value to the business and wealth Board of Directors. The Executive Committee is to the shareholders; authorised to approve any transaction that is binding (3) to hold the Company’s annual ordinary general meeting on the Company worth up to Baht 50,000,000 (Baht of shareholders within no later than four months from fifty million), excluding transactions which give rise to the end of the Company’s financial year and extraordinary a conflict of interest with the Company and its Subsidiary general meetings of shareholders when it deems pursuant to the notification of the Securities and necessary; Exchange Commission, including transactions which (4) to hold the Company’s Board of Directors’ meetings require approval from the Company’s shareholders in quarterly, at which not less than 50% of the total number accordance with the notifications of the Securities and of directors must attend the meeting to form a quorum. Exchange Commission and the Stock Exchange of A majority vote is required for any decision made at Thailand; such a meeting and in the case of a tied vote, the (12) to consider and specify the power, duties and chairman of the meeting will have a casting vote; responsibilities, procedures for the appointment, (5) to consider and approve the budget for the Company’s employment and removal, disciplinary actions, salary, annual investment and operations, including monitoring welfare benefits, bonus, gratuities and other remuneration, the utilisation of the Company’s resources; including expenses and fringe benefits, of the President (6) to arrange for the preparation of proper, accurate and of the Company; adequate financial and general significant reports to the (13) to consider and approve interim dividend payments to Company’s shareholders, including confirming the the Company’s shareholders from time to time as it review and certification of the information contained deems appropriate and in accordance with the law; therein; (14) to approve the issuance of financial instruments and any (7) to establish an efficient and effective internal control other securities by the Company, to specify the number, system, internal audit system and risk management price, date, procedures and conditions in respect of the measures, including regularly auditing such systems underwriting of such securities under the law and/or as and measures; specified by the meeting of the shareholders of the (8) to consider the appointment of any sub-committees or Company, including the appointment of underwriters of other persons to manage the Company’s operations such securities and underwriting agents. under the control of the Board of Directors of the Company, or to grant such authority to such persons Selection Procedures for the Directors for such period of time as the Board of Directors of the The Nomination and Remuneration Committee will consider Company deems appropriate, provided that the Board selecting qualified persons to act as directors and propose such persons to the Board of Directors for further

Annual Report 2013 Bangkok Metro Public Company Limited 87 submission to a meeting of the shareholders or to the Board B. Audit Committee of Directors for appointment in accordance with the Articles As at 31 December 2013, the Company’s Audit Committee of Association of the Company. comprised three members, each of whom met the The Board of Directors of the Company must comprise at qualifications as specified by the Office of the Securities least five directors, of which not less than one-half must and Exchange Commission and relevant rules and reside in Thailand. The directors must have the qualifications regulations, as follows: as specified by law and be appointed by a meeting of shareholders of the Company in accordance with the Name Position following rules and procedures: 1. General Chetta Thanajaro Chairman of the Audit Committee 1. Each shareholder shall be entitled to one vote per share; 2. Mr. Vitoon Tejatussanasoontorn /1 Audit Committee Member 2. Each shareholder must use all of the votes under 3. Lieutenant General Surat Sumrith Audit Committee Member paragraph 1 to appoint one or more directors and may Note not divide such votes among candidates; /1 The Audit Committee member who has adequate knowledge and experience 3. The number of votes received is ranked from highest to to review the reliability of the financial statements. lowest and the directors will be appointed from the highest to lowest according to the number of directors to be Secretary to the Audit Committee, Senior Manager, Office of appointed by the Company at that time. Any tied votes for the Internal Audit, serves as Head of the Internal Audit Unit the final vacancy shall be decided by a drawing of lots. of the Company. Retirement from Directorship Roles and Duties of the Audit Committee At every annual ordinary general meeting, one-third of (1) review the Company’s financial reporting process to the number of directors shall vacate their office. If the ensure that it is accurate and adequate; number of directors is not a multiple of three, then the number (2) to review the Company’s internal control system and nearest to one-third must retire from office. The directors internal audit system to ensure that they are suitable and to retire during the first and second years following the efficient, to determine an internal audit unit’s independence, registration of the Company shall be drawn by lots. In each as well as to approve the appointment, transfer and subsequent year, the directors who have been in office for dismissal of the chief of an internal audit unit or any other the longest term shall retire. A director retiring by rotation unit in charge of an internal audit; is eligible for re-election. (3) to review the Company’s compliance with the law on Other than vacancy by rotation, a director shall vacate securities and exchange, the Stock Exchange’s regulations, office upon: and the laws relating to the Company’s business; • death; (4) to consider, select and nominate an independent person • resignation (effective from the date of the Company’s to be the Company’s auditor, and to propose such person’s receipt of the resignation letter); remuneration, as well as to attend a non-management • of qualifications or possession of prohibited meeting with an auditor at least once a year; characteristics under the laws; (5) to review the Connected Transactions, or the transactions • removal by a resolution of a meeting of shareholders; that may lead to conflicts of interests to ensure that they • removal by a court order. are in compliance with the laws and the Stock Exchange’s regulations, and are reasonable and for the highest In case of a vacancy on the Board of Directors otherwise benefit of the Company; than by rotation, the Board of Directors shall elect any person (6) to prepare, and to disclose in the Company’s annual who is qualified and not subject to prohibition under the laws report, and audit committee’s report which must be as a replacement director at the following meeting of the Board of Directors, except in the case where the remaining term of office of such director is less than two months. The replacement director shall hold the office only for the remaining term of the director whom he or she replaces.

Annual Report 2013 88 Bangkok Metro Public Company Limited signed by the audit committee chairman and consist of Board of Directors of the Company for further submission to at least the following information: a meeting of the shareholders or the Board of Directors of the (a) an opinion on the accuracy, completeness and reliability Company for appointment. The Company shall have one of the Company’s financial report; Audit Committee, comprising at least three independent (b) an opinion on the adequacy of the Company’s internal directors appointed for a period of three years each. The control system; qualifications of the independent directors and Audit Committee (c) an opinion on the compliance with the law on securities members shall be in accordance with the minimum requirements and exchange, the Stock Exchange’s regulations, or as prescribed in the notifications of the SEC and the Stock the laws relating to the Company’s business; Exchange of Thailand. (d) an opinion on the suitability of an auditor; (e) an opinion on the transactions that may lead to conflicts C. Executive Committee of interests; As at 31 December 2013, the Company’s Executive Committee (f) the number of the audit committee meetings, and the comprised four members, as follows: attendances of such meetings by each audit committee member; Name Position (g) an opinion or overview comment received by the 1. Mr. Plew Trivisvavet Chairman of the Executive Committee audit committee from its performance of duties in 2. Dr. Sombat Kitjalaksana Vice Chairman of the Executive Committee accordance with the charter; and 3. Mr. Supong Chayutsahakij Executive Committee Member (h) other transactions which, according to the audit committee’s 4. Mr. Chaiwat Utaiwan Executive Committee Member opinion, should be known to the shareholders and general investors, subject to the scope of duties and responsibilities assigned by the Company’s board of Roles and Duties of the Executive Committee directors; and (1) to set policies, appoint, specify their authorities and duties, (7) to perform any other act as assigned by the Company’s supervise, monitor and liaise with, working groups or board of directors, with the approval of the audit committee. special working groups or management groups, including Selection Procedures for Independent Members of considering and approving any proposal by such working the Audit Committee groups or management groups or special working groups; The Nomination and Remuneration Committee will select (2) to approve any proposals by working groups or management persons with suitable qualifications as independent members of the Audit Committee and propose such persons to the

Annual Report 2013 Bangkok Metro Public Company Limited 89 groups or any working groups for the benefits of the Board of Directors from time to time; Company’s management and business operations under (8) to appoint persons or groups of persons to manage the the objectives of the Company; Company under the control of the Executive Committee (3) to enter into transactions binding the Company worth up or to grant authority to such persons or groups of persons to Baht 50,000,000 (Baht fifty million), but excluding to do any acts as the Executive Committee deems transactions which give rise to a conflict of interests with appropriate and to change, amend, cancel or revoke the Company or its Subsidiary, pursuant to the notification such authorities; of the Securities and Exchange Commission, including (9) to appoint the advisory chairperson or advisors or advisory transactions which require approvals from the Company’s committees to the Executive Committee as it deems shareholders in accordance with the notifications of the appropriate and to fix the remuneration, allowance, Securities and Exchange Commission and the Stock welfare benefits, fringe benefits and other expenses of Exchange of Thailand. Such transactions include the such appointees as appropriate; following: (10) to call meetings of the Executive Committee and/or a. undertaking any juristic acts which bind the Company; specify regulations and articles of such meetings as the b. withdrawing from any bank account of the Company Executive Committee or the Chairman of the Executive and applying credit with the Company’s current banks Committee deems appropriate; or financial institutions, including the application to (11)when the Chairman of the Executive Committee cannot open accounts and/or other forms of credit with any perform the duties, the Chairman shall appoint an acting banks or financial institutions, as well as using the Chairman to perform such duties on a case by case Company’s securities as security for such debts, basis and such acting Chairman will have the same regardless of whether registered or not; power and duties as the Chairman of the Executive c. undertaking joint investments on behalf of the Company Committee; with individuals, juristic persons, other groups of (12)to consider and approve the authorities of the management persons under the law to proceed in accordance with of the Company according to the rules, regulations and the Company’s objectives, including other forms of articles of the Company. investments, such as, share acquisitions and share swaps with other juristic persons, as it deems appropriate; However, the Executive Committee does not have the power d. undertaking feasibility studies of new projects as well to approve any transactions or matters in respect of which as considering and approving projects as it deems the Executive Committee or persons have a conflict, interest appropriate; or conflict of interest with the Company or its Subsidiary, (4) to specify, consider and approve articles, regulations, pursuant to the notification of the Securities and Exchange policies on the management and business operations Commission. of the Company or any operation binding on the Company; (5) to give recommendations and advice and specify policies, Selection Procedures for the Executive Committee powers and duties of the President, working groups, The Board of Directors of the Company shall appoint the special working groups and management groups; Executive Committee in accordance with the Articles of (6) to approve, appoint, employ, remove, impose disciplinary Association of the Company, which provide that the Board actions, fix salaries, welfare benefits, bonuses, gratuities of Directors of the Company may appoint any other person and other remuneration, including expenses and fringe to manage the Company under the control of the Board of benefits of the officers or staff of the Company holding Directors, provided that any such person who is to be a positions of division heads or higher, including the Deputy member of the Executive Committee shall have the President or equivalent or the working groups, special qualifications and capacity to perform their duties. working groups or management groups of the Company for specific purposes; (7) to perform any act as authorised by the Company’s

Annual Report 2013 90 Bangkok Metro Public Company Limited D. Nomination and Remuneration Committee E. Risk Committee As at 31 December 2013, the Nomination and Remuneration As at 31 December 2013, the Risk Committee of the Committee of the Company comprised three members as follows: Company comprised six members as follows: Name Position Name Position 1. General Chetta Thanajaro Chairman of the Nomination and 1. Mrs. Vallapa Assakul Chairman of the Risk Remuneration Committee Committee 2. Mr. Plew Trivisvavet Nomination and Remuneration 2. Mr. Chaiwat Utaiwan Risk Committee Member Committee Member 3. Mr. Witoon Hatairatana Risk Committee Member 4. Mr. Visuit Boreriboon Risk Committee Member 3. Mr. Vitoon Tejatussanasoontorn Nomination and Remuneration 5. Miss Veena Tachachainirun Risk Committee Member Committee Member 6. Mr. Chatchaporn Triwimol Risk Committee Member and Secretary to the Risk Committee Roles and Duties of the Nomination and Remuneration Note : The Risk Committee was appointed by the resolution of the Board Committee of Directors’ Meeting No. 2/2012, held on 3 April 2012. (1) to consider the nomination of persons with suitable qualifications as directors and to propose such persons Roles and Duties of the Risk Committee to the Board of Directors for further submission to a (1) to consider and set the policies on risk management meeting of the shareholders of the Company or the measures and plans for the operations of the business of the Company for submission to the Board of Directors Board of Directors of the Company for appointment; for approval; (2) to select a person suitable for the President position and (2) to monitor and assess the appropriateness of the overall propose such person to the Board of Directors of the risk management system of the Company; Company for appointment; (3) to prepare recommendations to the Board of Directors (3) to specify the rules for determination of remuneration of of the Company in respect of risk management, standard directors and the President; practice, strategy, risk assessment in each matter and (4) to determine and to propose the directors’ remuneration of the Company as a whole to ensure efficient and effective risk management; to a meeting of the shareholders of the Company for (4) to prepare risk reports for the Board of Directors of the approval; Company; (5) to propose the salary and adjustments and other remunerations (5) to carry out other matters as assigned by the Board of of the President to the Board of Directors of the Company Directors of the Company; for approval; (6) to engage external advisors to provide suggestions at (6) to undertake other matters as assigned by the Board of the Company’s expenses, subject to the Board of Directors’ Directors of the Company. approval. Selection Procedures for the Risk Committee Selection Procedures for the Nomination and The Board of Directors of the Company shall appoint Remuneration Committee members of the Risk Committee. The Board of Directors of the Company shall appoint members of the Nomination and Remuneration Committee Roles and Duties of the President who shall hold such office for a period of three years. (1) to control and monitor all businesses of the Company and to ensure compliance with resolutions and policies of the Board of Directors and the Executive Committee of the Company; (2) to approve, appoint, remove, employ, impose disciplinary actions, fix salary, bonus, gratuities, welfare benefits and other remuneration, including expenses and fringe

Annual Report 2013 Bangkok Metro Public Company Limited 91 benefits for management or staff with salary (exclusive However, the President does not have the power to approve of other remuneration) of up to Baht 200,000 (Baht two any transactions or matters in respect of which the President hundred thousand) per month, holding positions below or other persons may have a conflict of interest with the division heads (excluding the Deputy President and Company or its Subsidiary, pursuant to the notification of division heads or equivalent), and the President may the Securities and Exchange Commission. delegate such power or duties to the working groups or the Board of Directors, management group, group of Selection Procedures for Management and Staff persons or the management, as he deems appropriate; - The President will be appointed by the Board of Directors (3) to have the power to enter into any transaction, binding of the Company through the nomination by the Nomination on the Company, worth up to Baht 2,000,000 (Baht two and Remuneration Committee; million) for each transaction; - Management at the level of division head or higher will (4) to authorise the management of the Company, such as, be nominated, selected and appointed by the Executive the Deputy President, Executive Vice President, the Committee; division heads or equivalent, to perform certain duties - Management whose salary does not exceed Baht on behalf of the President (such as, procurement, hiring 200,000 per month and holding a position lower than and ordering payments) as he deems appropriate; division head will be nominated, selected and appointed (5) to have the power to issue, amend, add, improve regulations, by the President; orders and work rules of the Company, including employment, appointment, removal and disciplinary actions of staff - The selection, nomination and recruitment of positions and employees, fixing of salaries and other remuneration, lower than manager or equivalent shall be carried out by including gratuities and welfare benefits; the Office of the Human Resources which will make the (6) to have the duty to submit the balance sheet, financial selection jointly with the relevant division in accordance with statements and profit and loss accounts to the Board of the Company’s operation regulations in relation to the Directors of the Company for approval; recruitment and selection procedure. They shall recruit and (7) to undertake feasibility studies of new projects as well appoint persons with knowledge, capacity and experience as consider and approve such projects as assigned by suitable to carry out their duties for the Company. the Executive Committee; (8) if the President cannot perform his duties, to appoint the 14.3 Supervision of Operations of Subsidiary Deputy President or any other person to perform his The Company has a monitoring policy or participates in duties on his behalf on a case by case basis and such determination of policies which are essential to the business appointee shall have the same power and duties as the operations, whereby the Company sends its four President; representatives, from a total of seven directors, to serve as (9) to appoint persons or groups of persons to manage the directors in the Subsidiary. Company under the control of the President or to grant The Subsidiary shall carry out operations subject to the such authority to such persons or groups of persons to policies of the Board of Directors of the Company which do any acts as the President deems appropriate, and supervise the operations via the President, the Deputy to change, amend, cancel or revoke such authority; President and division heads in each division, whereby the (10) to propose any matter to the Board of Directors, the Subsidiary clearly determines in writing the powers, duties Executive Committee, the Audit Committee or meetings and amount of money for approval by the management at of the shareholders of the Company for consideration, each level. Moreover, the Subsidiary’s execution of any approval or other purposes as he deems appropriate; related party transactions, acquisition or disposition of (11) to do other acts as assigned by the Board of Directors assets, or other significant transactions shall be subject to or the Executive Committee of the Company from time prior approval of the Board of Directors and/or the to time. shareholders’ meeting, taking into account the best interests of the Company.

Annual Report 2013 92 Bangkok Metro Public Company Limited Selection of Directors and Management of Subsidiary management and staff of the Company will strictly adhere to these guidelines with accountability as well as causes The Company’s Subsidiary does not have its own nomination and effects on a case by case basis. These guidelines and committee. The selection of its directors is carried out by policies will be stricter than the provisions of law, and will its shareholders and the selection of the management is apply to directors, management and staff, including related carried out by its board of directors, provided that its directors persons. and management are suitably qualified without any prohibited characteristics under Section 68 of the Public Limited 14.4.2 Securities Sale and Purchase Using Insider Companies Act B.E. 2535 (1992). Information 14.4 Insider Information Supervision Prohibited Persons The Company has set the following guidelines to prevent Persons who should not sell or purchase securities pursuant the use of insider information as per the resolution of the to the guidelines to prevent the use of insider information Board of Directors’ Meeting No. 3/2005 held on 10 March are as follows: 2005. (1) Directors and management of the Company; 14.4.1 General (2) Directors and management of the Company’s Subsidiary, As the Company is a public limited company incorporated including its affiliates; under the Public Limited Companies Act B.E. 2535 (1992) (3) All staff of the Company and of the Company’s Subsidiary; and is intending to have an initial public offering of its shares, (4) Spouses and minor children of the directors and staff; and following the listing of its shares on the Stock Exchange of (5) Relatives who live with such persons above. Thailand, any sale or purchase of the Company’s securities Prohibited Securities by its management or staff based on material facts that may Securities refer to shares, share warrants, convertible affect the market price of the shares or securities, which debentures and transferable subscription rights issued by have not yet been disclosed to the public, and which have the Company. been obtained by their duties or positions in the Company, would be considered as taking advantage of third parties, General Practice and may be subject to a criminal penalty under the law. (1) Prohibited persons as described above should not sell Therefore, to prevent the Company’s staff and directors, or purchase the securities under any circumstances if including the Company itself, from encountering any such they are aware or should be aware of material information illegal acts which may violate such law, as well as to comply that may affect the market price of the Company’s securities, with good corporate governance guidelines of the Company, which has not yet been disclosed to the public. the Company’s Board of Directors has set guidelines to (2) Prohibited persons who are in possession of such material prevent the use of insider information. Such guidelines will information due to their duties and positions as the be revised from time to time as appropriate and all directors,

Annual Report 2013 Bangkok Metro Public Company Limited 93 Company’s staff shall not disclose such information to to the Company on the same day. any other person while such information has not yet (2) Officers as specified in paragraph A. (2) shall disclose their been disclosed to the public, unless it is done in the securities holdings and changes in their own securities performance of their duties in the Company. holdings as per paragraph B. (1) as well as holdings of their spouses and their minor children, to the Company Specific Guidelines within seven business days from the date of change in In addition to the general guidelines to prevent the use of title to the Securities. insider information, prohibited persons shall also follow the following guidelines: 14.5 Remuneration of Auditor (1) Prohibited persons who are directly involved in the In the accounting period ended 31 December 2013, the preparation of the Company’s financial statements and remuneration of auditor, Ernst & Young Office Limited, was balance sheet, are prohibited from any purchase or sale a total of Baht 2,300,000, namely, audit fee of the Company from the commencement of such preparation until the and its Subsidiary per the details as follows: day immediately following the disclosure date of such financial statements. Name of Payor Auditor Audit Fee (Baht) (2) Any directors, management or staff who have received Bangkok Metro Public Company Limited Mr. Supachai Phanyawattano 1,315,000 the draft financial statements as referred to above, are Bangkok Metro Networks Limited Mr. Supachai Phanyawattano 985,000 prohibited from selling or purchasing the Company’s Total Audit Fee 2,300,000 securities from the day that they receive the draft financial statements until the disclosure date of the financial statements. The Company and its Subsidiary did not incur any non-audit (3) Prohibited persons, who know or should have known that fee which must be paid to the auditor, the audit firm in which the Company will disclose material information that may the auditor is a member, and persons or business related to affect the market price of the Company’s securities, are the auditor and the audit firm in which the auditor is a member. prohibited from selling or purchasing the Company’s securities from the day that they know or should have known 14.6 Compliance with the Corporate Governance such information until the disclosure date of such information. Policy Chapter 1 Right of Shareholders. 14.4.3 Report of Prohibited Persons The Company realises the significance of the shareholders’ A. Duty to Prepare Reports rights that the shareholders hold the ownership to control the (1) Directors, managers or persons who hold management Company by way of appointment of the Board of Directors to positions as specified in the Securities and Exchange represent them as well as their right to decide on any significant Act shall be required to prepare disclosure reports of changes of the Company. Therefore, various guidelines are set their initial securities holdings, and changes in such to encourage the shareholders to exercise their rights, such holdings, pursuant to the relevant laws and regulations, as, the shareholders’ fundamental rights, other than participation together with such reports to the Company. to vote in the shareholders’ meeting, the shareholders shall also (2) Officers in the chief position or above shall report all have the rights to purchase, sell or transfer shares on an equal acquisitions or disposals of securities holdings equal to basis, receive revenue sharing or dividend payment, including 5% or more of the total issued shares. receipt of information and news of the Company on a continual basis. In this regard, the Company would not take any actions B. Reporting Procedures in violation of or depriving the shareholders of their rights. To date, (1) Directors, managers or persons as specified in paragraph the Company’s best practices for its shareholders are as follows: A. (1) above who have the duty under law to disclose The Annual Ordinary General Meeting of Shareholders their securities holdings, their spouses’ securities holdings, (1) The Company assigns Thailand Securities Depository and their minor children’s securities holdings to government Company Limited, as its share registrar, to deliver notice agencies or regulators shall submit copies of such reports of the shareholders’ meeting and supporting documents

Annual Report 2013 94 Bangkok Metro Public Company Limited to all shareholders in advance at least 21 days prior to the 3.2) To consider the remuneration of directors, whereby the meeting date, whereby the notice of the meeting shall Company shall propose all forms of remuneration of contain full details, namely, date, time, place and agenda, directors as provided by the Company to directors, and clearly specify objectives, reasons and opinions of namely, monthly remuneration and meeting allowance, the Board of Directors on each item of the proposed to the shareholders’ meeting for approval on a yearly agenda. basis; To ensure that shareholders acknowledge matters to be 3.3) To consider the appointment of the Company’s auditor, considered in the meeting in order to serve as a factor by clearly specifying the auditor’s name, company, for consideration of making a decision to attend the auditing license, experience and capabilities, number meeting, and that the shareholders obtain information of audit years for the Company, including issues relat- in support of their decision making in advance prior to ing to independence and fee of the auditor; the meeting, the Company shall avoid adding other 3.4) To consider and approve dividend payment, by clearly agenda items required the meeting’s resolution without notifying the Company’s policy to pay dividend, and prior determination in the shareholders’ meeting, which reasons and information in support of consideration in is deemed to be unfair treatment towards shareholders such case of no dividend payment; absent from the meeting. 3.5) The meeting notice shall clearly contain facts and (2) The Company allows the shareholders to vote to elect reasons of each agenda item, including opinion of the directors on an individual basis, by nominating directors Board on each agenda item. to the shareholders for voting on an individual basis in (4) The Company allows the shareholders to propose in order for the shareholders to have the right to truly elect advance items of the agenda of the shareholders’ meeting directors of their choice. and nominate directors, by way of announcement via (3) The Company shall clearly specify agenda items of the the channels of the Stock Exchange of Thailand and the shareholders’ meeting and complete details on agenda Company’s website, together with detailed and clear items in the notice of the shareholders’ meeting, consisting criteria for consideration and acceptance of the proposed of: matters in the agenda, directly via the Company’s website. 3.1)To consider electing the directors, by specifying (5) The Company allows the shareholders to make inquiries names, surnames, age, education, work experience, and provide their opinions in advance to the Board of number of companies holding office as director, including Directors on any matters relating to the Company, which nomination procedures and criteria, category of would be answered in the shareholders’ meeting, by way nominated directors, such as, directors or independent of announcement via the channels of the Stock Exchange directors, together with information on attendance at of Thailand and the Company’s website, directly via the the previous meetings, and period/year of holding Company’s website. office as director in the Company;

Annual Report 2013 Bangkok Metro Public Company Limited 95 (6) The Company convenes the shareholders’ meeting at website within the following business day, and place which is convenient for shareholders’ travel by disseminates the final version of the minutes of the electric train and passenger bus service. shareholders’ meeting on the Company’s website at (7) The Company uses the barcode system and the AGM/ www.bangkokmetro.co.th within 14 days from the EGM Voting Service provided by Thailand Securities meeting date to enable the shareholders to review Depository Company Limited in its shareholders’ meeting such information instead of waiting until the next in respect of registration, voting, and counting of votes meeting. and display of results to ensure rapid, correct and accurate (10) The Chairman of the Board of Directors, chairmen of conduct of the meeting. various committees, namely, Chairman of the Audit (8) The Company authorises the legal advisory company to Committee, Chairman of the Nomination and Remuneration examine the counting or results of votes in the shareholders’ Committee, Chairman of the Risk Committee, Chairman meeting and inform the meeting thereof, as well as recording of the Executive Committee and the President (top in the minutes of the meeting. management), and auditor of the Company participate (9) The Company efficiently prepares the minutes of the in every annual ordinary general meeting of shareholders shareholders’ meeting covering significant details on to answer questions in relevant matters, except for the various matters as follows: 2013 Annual Ordinary General Meeting of Shareholders, 9.1) Record of clarification on voting process by way of in which the Chairman of the Board of Directors was announcement of the voting method and counting unable to attend, due to his engagement in another by using voting cards, including the display of voting important business. results, to the shareholders prior to the meeting; 9.2) Record of questions posed by the shareholders and Furthermore, the shareholding structure of the Company answers or opinions on various items at the meeting and its Subsidiary is disclosed with clarity, transparency and to allow the shareholders absent from the meeting open for review. The Company has a free float greater than 25%, with the shareholding proportion of institutional to acknowledge the same; investors in aggregate more than 5%, and the Board of 9.3) Clear record of resolutions of the meeting, together Directors shall hold shares in aggregate not exceeding 1% with such votes on each agenda item to agree, of the Company’s paid-up shares. disagree and abstain on all items requiring voting; 9.4) Record of the list of attending directors and absent Chapter 2 Equitable Treatment of Shareholders directors, together with their position, for review of The Company ensures its equal treatment towards all the directors’ participation in each shareholders’ shareholders, including minority and foreign shareholders, meeting. with the following guidelines for protection of the In this regard, the Company disseminates resolutions shareholders’ rights: of the shareholders’ meeting via the news system of the (1) In the shareholders’ meeting, the Company allows all Stock Exchange of Thailand and on the Company’s shareholders to cast votes, namely, one share for one vote,

Annual Report 2013 96 Bangkok Metro Public Company Limited to ensure equitable treatment towards the shareholders, appointed as the Company’s director prior to the meeting based on the criteria that shares of the same type should date. In this connection, the Company clearly notifies represent the right to vote on an equitable basis, namely, the shareholders of the details, together with the criteria one share for one vote. for the consideration via channels of the Stock Exchange (2) The Company delivers the notice of the shareholders’ of Thailand and the Company’s website, for three months, meeting and supporting documents in Thai version to in order to build up the confidence of the minority Thai shareholders. To facilitate foreign shareholders, shareholders to exercise the right to propose any matters the Company prepares the notice of the shareholders’ relating to any significant change of the Company and meeting and supporting documents in English version the right to elect any independent directors to take care to the foreign shareholders. In this regard, both Thai and of the benefits on their behalf. foreign shareholders shall receive complete documents (8) The Company proceeds the shareholders’ meeting in within the period of time specified by law. accordance with the agenda as notified in the notice of (3) The Company schedules and announces the shareholders’ the meeting without addition of any agenda item without meeting and items of agenda, together with all supporting prior notice to shareholders in order for shareholders to documents, both in Thai and English versions, on the study information in support of consideration prior to Company’s website 30 days in advance prior to the casting votes. meeting date. In this regard, the Company’s website is (9) The Company sets out the written guidelines to prevent a channel for shareholders to access the details of the the use of insider information of the Company under the shareholders’ meeting prior to delivery of the notice of resolution of the Board of Directors, whereby the Company the shareholders’ meeting at a later date. treats this as important policy which will prevent directors, (4) Any shareholder unable to attend the meeting in person management and staff from abusing their position for may exercise his/her right to vote by appointing proxy personal interests, as specified in the Annual Report. to attend and vote on his/her behalf and the Company In addition, the Code of Conduct and Business Ethics are nominates two independent directors for optional appointment distributed and disseminated to all directors, management of proxy by shareholders. In this regard, the Company and staff of the Company for acknowledgment and sends Proxy Form B, together with the notice of the compliance, which are available on the Company’s website shareholders’ meeting, in order for the shareholder as a channel for all staff to access such information. unable to attend the meeting on such specified date to still have his/her equal right as shareholder. The Company’s directors and management are required (5) The notice of the shareholders’ meeting specifies clear details, to disclose the reports to the Securities and Exchange documents and evidence in support of the appointment Commission on their holding of securities, his/her of proxy, together with suggestions and procedures for spouse’s holding of securities and minor children’s holding appointment of proxy to enable the shareholders to of securities which are securities in the Company, as produce complete documentations without any difficulty well as reporting on every change in such holdings of in attending the meeting by proxy. securities in respect of purchase, sale, transfer or acceptance (6) As for the requirement for appointment of proxy by any of transfer, under Section 59 of the Securities and Exchange shareholder unable to attend the meeting in person, the Act B.E. 2535 (1992) within three business days after Company has not set out any rules or conditions causing the date of purchase, sale, transfer or acceptance of any difficulties to the appointment of proxy to attend the transfer of securities. Moreover, the directors and meeting on his/her behalf. Instead, such documents shall be certified by the proxy grantor and the proxy holder management realise their duties and responsibilities as to confirm the exercise and granting of the right to attend specified, including the penalty provisions as specified the shareholder’s meeting in accordance with the criteria. in the Securities and Exchange Act B.E. 2535 (1992). (7) The Company has the process and channels for minority shareholders to involve in the Company’s management, The Company pays significant attention to the efficient by allowing the minority shareholders to propose any item internal control system by setting out the internal controlling of agenda of the ordinary general meeting of shareholders and propose any qualified person to be considered and

Annual Report 2013 Bangkok Metro Public Company Limited 97 guidelines to prevent and minimise risks which may arise, message from the President with his commitment and namely, the Company specifies that the management with intention to operating the business by taking into account access to insider information shall be prohibited from responsibility towards all stakeholders. In this regard, the taking any actions in violation of Section 241 of the Company recognises the necessity to develop the Securities and Exchange Act B.E. 2535 (1992), including organisation to ensure growth and to be one of the world applicable regulations. Due to the guidelines to prevent leading mass rapid transit operators on a sustainable basis, the use of insider information, in each past year, there by always adhering to the principles of creating and has never been any case that the Company’s directors maintaining the balance among society, environment and and management abuse insider information for personal economy. The Company participated as a member of the interests or others. Sustainable Development Charter as a Pledge Signatory of (10) The Company clearly discloses to shareholders the the International Association of Public Transport (UITP) in details and reasons of execution of related party transactions June 2008 and the Company was admitted to the membership requiring the disclosure or approval of shareholders of the Sustainable Development Charter as a Full Signatory under the Stock Exchange of Thailand’s regulations, by in 2009, whereby the Company has been permitted to renew disclosing names and relationship of connected persons, its third membership period (2012-2014), representing its pricing policy and transaction value, including opinion firm commitment to complying with the contractual of the Board relating to such transactions. obligations to ensure the strategic policies in line with the (11) Last year, the Company did not execute any related party principles of the business operation to balance among transactions in violation of or not in compliance with the business, social and environmental growth, with internal rules of the Stock Exchange of Thailand and/or the Office systems for application, monitoring, following up and of the Securities and Exchange Commission. In this regard, reporting of the performance under such guidelines. other than the notifications of such related party transactions via channels of the Stock Exchange of Thailand, the Therefore, the Company recognises the significance of all Company also discloses the related party transactions in groups of stakeholders, whether they be staff, shareholders, the Company’s Annual Report. Such related party customers, partners and suppliers, creditors, competitors, transactions were executed fairly according to the market communities/society, and environment, regulators, price and in ordinary course of business. collaborators, and press release. To this end, the Company (12) The Board of Directors sets out a policy to have any prepares the Code of Conduct and Business Ethics interested directors in any agenda item refrain from containing such principles for distribution to all staff of the participating in the meeting for consideration of such Company. The guidelines for treatment towards the agenda item. stakeholders of the Company are as follows: (1) Staff Chapter 3 Role of Stakeholders The Company realises that all of the Company’s staff are The Company is aware that all groups of stakeholders of valuable and play an important role in its business operations, the Company should be bestowed due care by the Company the Company then regularly and continuously supports under their rights as stipulated by law or mutually agreed, development and training of staff at all levels in various taking into account good relationship and cooperation, to courses. The Company also takes care of its staff equally, ensure stability and serve as a factor supporting the regardless of gender, citizenship, nationality and religion, Company’s long-term and continued growth. The Company by provision of appropriate and fair remuneration and welfare, sets out its clear policies serving as guidelines and practices as well as creating a good working environment and taking to develop the organisation, with the aim of ensuring common into account staff’s security by ensuring work safety and benefits and growth of all groups of stakeholders of the the highest efficiency, including organisation of various Company, i.e., quality policy, safety policy, environment activities under the “Happy Workplace” campaign which policy, energy saving policy, and sustainable development helps promote staff’s good physical and mental health and policy. In so doing, the Company regularly prepares a report happy work performance (per details in the Sustainability on sustainable development every year and there is a Report 2013).

Annual Report 2013 98 Bangkok Metro Public Company Limited (2) Shareholders as well as taking into account opinions and suggestions of The Company sets out concrete policies and practices customers for review and improvement of the services to expressing the Company’s responsibility towards the the customers’ utmost satisfaction. In this respect, the shareholders on an equal basis. The Company’s treatment Company has also established the Customer Relations towards shareholders complies with the good corporate Center for customers to contact or make inquiries as well governance principles in the Chapter: Shareholders’ Rights as expressing opinions and suggestions to the Company and Equitable Treatment towards Shareholders. In addition, (Customer Relations Center: 66(0)2624-5200 or E-mail: the Company pays significant attention to the annual ordinary [email protected]). general meeting of shareholders by complying with the assessment of the shareholders’ meeting by the Office of Moreover, the Company has conducted satisfaction survey the SEC and the Thai Investors Association before the meeting, of regular customers, including study on various factors and during the meeting and after the meeting for facilitating all behaviours of the metro use on key issues, namely, staff, shareholders to exercise their right to vote in the meeting on safety, speed and reliability, convenience, news and an equitable basis. In the past, the Company was rated information updates, our services as a whole for improved “Excellent” in the assessment of the 2007 - 2013 Annual quality of the services in all respects to fulfil customers’ Ordinary General Meetings of Shareholders for seven years requirements (per details in the Sustainability Report 2013). in a row. In addition, the Company’s website, www.bangkokmetro.co.th, (4) Partners/Suppliers is also available for shareholders or stakeholders to contact or The Company sets out policies and practices for fair submit complaints on any matters which may cause damage to treatment towards partners of the Company, by making the Company, directly to the Audit Committee via E-mail: decisions based on comparison of terms, prices, quality and [email protected]. services with transparency and open for review, as well as undertaking in accordance with obligations as mutually (3) Customers agreed for the purpose of development and maintenance The Company sets out clear and concrete policies relating of sustainable relationship along with the clear objectives to fair treatment and responsibility towards customers and of the value of goods and service. make public announcement in accordance with the Company’s vision “To be one of the world leading mass (5) Creditors rapid transit operators with high quality of service”, including The Company sets out concrete policies and practices for fair the Company’s mission “We will provide mass transit services treatment towards creditors, by clearly demonstrating the to the public with the safe, convenient, fast, reliable and Company’s responsibility towards its creditors. In the past, the punctual metro system to alleviate traffic congestion, Company has always been fairly treating its creditors and never maintain the environment and improve the quality of life”. been in breach of any agreements with the Company’s creditors. To that effect, the Company received the certifications of the ISO 9001:2008 Quality Management System, and the (6) Competitors OHSAS 18001:2007 and the TIS 18001:2011 Occupational The Company focuses on operation of its business with Health and Safety Management Systems. The Company ethics, transparency and fair competition and subject to realises that due care for customers is the key to the legal compliance, without discrediting its competitors nor sustainable development. As such, the Company’s staff seeking confidential information of its competitors in bad would be well trained and developed to meet international faith or by dishonest means; and refraining from taking any standard in respect of which the Company acquires act in violation of intellectual property of other persons. knowledge from its membership of various international public transport organisations, namely, UITP, APTA, and (7) Society/Communities and Environment NOVA. The Company reviews and improves procedures The Company sets out policy on business operation by taking and regulations from experiences to provide services to all into consideration society/communities and environment customers, whether they be children, adults or general people, and complying with laws and requirements in various aspects

Annual Report 2013 Bangkok Metro Public Company Limited 99 without taking advantage of society. The Company takes The Stock Exchange of Thailand and the Office of the into account its responsibility and the value and significance Securities and Exchange Commission of its corporate social responsibility and protection of the The Company, in its capacity as a public company and listed environment. In this regard, upon comparison with other company on the Stock Exchange of Thailand, has strictly transit systems, the metro is environment-friendly by helping complied with the Securities and Exchange Act, including reducing noise, air pollution and saving energy. rules and regulations issued by the Stock Exchange and Society and Communities the Office of the SEC. The Company organised various activities for its staff and Over the past period, the Company has disclosed its the MRT users to participate in the social and environmental significant information via news system of the Stock development, such as, the National Children’s Day, the Exchange and prepared the financial reports and other National Elderly Day, the National Mother’s Day, the National reports, such as, related party transactions, strategic Father’s Day, to strengthen the good family relationships shareholders, within the specified period of time in and jointly save energy by way of using the metro. accordance with requirements of the Stock Exchange and Environment the Office of the SEC. The Company regularly applies the ISO 14001:2004 Environmental Management System to the Company’s (9) Collaborators environmental management and operates its business by Collaborators are external agencies in business contact with focusing on the energy conservation together with the the Company to ensure useful effects, such as, real estate sustainable environmental preservation in accordance with projects surrounding the MRT routes, whereby the Company the environmental policy, the energy conservation policy, has treated all collaborators in accordance with conditions and the Energy Management Manual. as mutually agreed as well as undertaking activities for (per details in the Sustainability Report 2013) promotion and support to ensure the mutual sustainable growth. (8) Regulators Mass Rapid Transit Authority of Thailand (MRTA) (10) Press Release The Company, in its capacity as the concessionaire of the The Company has realised the significance of press release operation and maintenance of the metro in the “M.R.T. and news via media through its cooperation with the press Chaloem Ratchamongkhon Line (MRT metro)” awarded by for dissemination of information and news of the Company the Mass Rapid Transit Authority of Thailand, realises the as well as maintaining its relationship, participation and good significance of its strict compliance with commitments and understanding with the press in order to ensure disclosure duties as mutually agreed in the Concession Agreement to of information based on accuracy, fairness and truth, to ensure creditability for the business operation, as well as disseminate accurate information to the audience in a timely reporting information with accuracy, completeness, manner via media, such as, newspaper, television, radio, transparency and open for review. Moreover, the Company reporters, securities analyst, etc. In this connection, the has provided cooperation and support to joint activities to Company has regularly and continuously organised press benefit the whole communities. In the past, the Company relations activities, for example, press seminar, press meeting organised the activities, in association with the MRTA, for discussion and sharing of opinions with the management namely, opening of the retail shop floor of Phra Ram 9 Station as well as allowing the press to visit the Company to ensure on the occasion of the MRTA’s 20th Anniversary, in association their understanding of the Company’s business operation, with its business partners and alliances surrounding the thereby rendering their presentation of the Company’s MRT routes, in the form of exhibition; introduction of the information and news accurate and suitable. metro system and support of the walk-run activity on the occasion of the MRTA’s 20th Anniversary, etc. Chapter 4 Disclosure and Transparency The Company realises the significance of the corporate governance by disclosing material information which affect or may affect change in the Company’s securities value or

Annual Report 2013 100 Bangkok Metro Public Company Limited investment decision making or benefits of the shareholders Company’s business operation, results of operations, in order for the shareholders and general interested people financial report, Management Discussion and Analysis to rapidly and equally acknowledge news and information. (MD&A) for the financial statements of every quarter, report At the same time, the Company also realises the necessity on responsibilities of the Board of Directors towards the to treat the significant details on business and operation financial report, the Code of Conduct and Business Ethics, strategies as confidential, whereby the Company shall not SET announcements, press release, news clippings, stock disclose any information which may affect its competitiveness. information, shareholder information, shareholding structure, Moreover, the Company requires its directors and shareholders’ meetings, quarterly IR presentations, Annual management to report to the Board of Directors’ Meeting Reports, etc., whereby all shareholders and stakeholders on their securities trading or holding every quarter, and also are able to easily access such information on an equal basis. requires them to report to the Company on their own interests or their related persons’ interests in respect of the business Contact Person management of the Company and its Subsidiary. The The Company assigned the Office of the President to be Company has been committed to equally disclosing responsible for works in respect of Investor Relations and information to shareholders, investors, and stakeholders of the Company Secretary, whereby contact may be the Company, including the public to ensure compliance conveniently made to inquire about the Company at with the rules and good practices of the Office of the SEC telephone number 02-354-2000 ext. 3513-3517 and E-mail and the Stock Exchange of Thailand. The Company has the Address : [email protected]. The contact channels guidelines on disclosure of significant information relating are clearly indicated on the Company’s website and the to the Company to the public with accuracy, completeness, Company’s Annual Report. punctuality and transparency in accordance with requirements stipulated by the Office of the SEC and the Stock Exchange Investor Relations Activities of Thailand through an easy access to information with The Company has realised the significance of investor reliability, such as, dissemination of information, both in Thai relations activities by preparing presentation and IR and English languages, on websites of the Stock Exchange newsletter as a medium of communication with investors of Thailand, the Office of the Securities and Exchange every quarter, and convening meetings of securities analysts Commission, including the Company’s Investor Relations to provide analysts with clarifications on business and results website: www.bangkokmetro.co.th/IR, which are regularly of operations of the Company, as well as allowing analysts updated. Such significant information comprise information on the Company’s Board of Directors and management, the

Annual Report 2013 Bangkok Metro Public Company Limited 101 to ask questions to the Company’s management regarding Moreover, the Board of Directors has appointed four the policy and the results of the operation, however, the sub-committees, namely, the Audit Committee, the Executive significant information which have not yet been disclosed Committee, the Nomination and Remuneration Committee, to the public shall not be mentioned. and the Risk Committee, to perform the specific functions The Investor Relations shall collect information on meetings for submission to the Board of Directors for consideration of securities analysts, together with presentation and IR or acknowledgment. newsletter for dissemination on the Company’s Investor Relations website (www.bankokmetro.co.th/IR), and Roles and Duties of the Board of Directors dissemination of complete, accurate and timely information The Board of Directors participated in determination of the and documents, as well as updating information on the corporate governance policy, the code of conduct and website regularly for the purpose of presentation of the business ethics, vision, missions, strategies, targets, Company’s information beneficial to the public widely and timely. business plans, and supervises the management to take The recognition of the significance of the investor relations actions to ensure compliance with the business plans and activities represents a way to provide information and news forecast budget with efficiency and effectiveness, including to shareholders and investors, and as such, the Company accountability of the Board of Directors towards the Company was awarded in its recognition of the remarkable listed and shareholders. In this regard, the Board of Directors company in respect of the investor relations activities for 2008 shall have the roles and duties to supervise the Company’s (IR Excellence Award 2008), for all groups of listed companies business operation in compliance with law and regulations. on the Stock Exchange which are not in SET 100 Index. In In the past, the Company has never violated any rules and 2009 and 2010, the Company was selected as one of the three listed companies nominated for IR Excellence Awards regulations of the Stock Exchange of Thailand and the Office for the group of listed companies on the Stock Exchange of of the Securities and Exchange Commission, with the details Thailand with market capitalisation less than Baht 10,000 million of the roles and duties of the Board of Directors as follows: (1st Group). In 2011, the Company also received the Outstanding 1. The Board of Directors sets out and approves a written Investor Relations Awards from the SET Awards 2011 for the corporate governance policy, provided that the Board group of listed companies on the Stock Exchange of Thailand of Directors shall review the policy at least once a year. with market capitalisation less than Baht 10,000 million (1st 2. The Board of Directors prepares the Code of Conduct Group), which is an award granted to the remarkable listed and Business Ethics for directors, management, and companies in respect of investor relations activities. staff, comprising the conflict of interest policy, the use of insider information for securities trading, and the Chapter 5 Responsibilities of the Board guidelines for treatment towards all stakeholders, by The Company realises the significance of the role and duties disseminating the same to all directors, management of the Board of Directors towards the Company and and staff of the Company for acknowledgment and shareholders. The Board of Directors shall consist of qualified compliance, which are available on the Company’s persons who have leadership, vision, knowledge, abilities website on its intranet, and on the Company’s main and experiences in various fields, honesty and integrity as website under Corporate Governance, as well as arranging well as independency on decision making for the optimum for training and test on the course of “Code of Conduct benefits to the Company and shareholders as a whole. and Business Ethics Review” via e-learning media for management and staff on a yearly basis. The Board of Directors Structure 3. The Board of Directors considers granting approval of The Board of Directors consists of 11 qualified persons, namely, important matters relating to the Company’s operations, four executive committee members, three non-executive such as, vision and missions of the Company, strategies, committee members and four independent directors, financial target, action plan and budget, as well as supervising, whereby the Board of Directors structure contains a variety controlling, monitoring to ensure the Management’s of education, experience, and expertise, comprising eight male compliance with the specified policies and plans with committee members and three female committee members. efficiency and effectiveness.

Annual Report 2013 102 Bangkok Metro Public Company Limited 4. The Board of Directors shall have a three-year term of of the Company shall be two different persons, provided office and each director should not hold office as director that such two positions shall be selected by the Board of of more than five listed companies. The Company realises Directors to ensure the most qualified persons. The key that the holding of office as director in several companies roles and duties of the Chairman of the Board of Directors may affect the efficiency of performance of such director, are as follows: the Company then sets out the policy to limit the number (1) To determine agenda items in association with the President of companies in which each director may concurrently and the Corporate Secretary as well as presiding over hold office as director, as well as clearly specifying the and ensuring the Board of Directors’ Meetings in compliance term of office of each director. with the agenda items and encouraging all directors to 5. The Board of Directors has two non-executive committee participate in sharing their opinions, and dealing with members (representing MRTA), with work experience any problems occurred in the meetings to ensure the in connection with the Company’s business. smooth proceeding. 6. The Board of Directors shall carefully consider a conflict (2) To ensure the clarity in determining the scope of duties of interest for the benefit of the Company and the and responsibilities between the Board of Directors and shareholders as a whole, whereby any stakeholders shall the Management. not participate in decision-making. (3) To lay down framework and monitor the corporate governance 7. The Board of Directors approves the establishment of of the organization. the Office of the Internal Audit which shall report directly (4) To preside over shareholders’ meetings. to the Audit Committee, with the duty to follow up and review the Company’s operations, together with the The Board of Directors consists of the Chairman of the operating system in various departments of the Company Board of Directors, the Vice Chairman of the Board of to ensure efficiency in compliance with the annual audit Directors, and directors. The Management consists of plan as approved by the Audit Committee. Last year, the President, Executive Vice President, Operations Group; the Company has never violated any rules and regulations Executive Vice President, Marketing Group; Executive of the Stock Exchange of Thailand and the Office of the Vice President, Finance Group; and Executive Vice Securities and Exchange Commission. President, Management Group. 8. The Company establishes the Compliance Unit under the supervision of the Legal and Compliance Department, The Board of Directors’ Meeting to ensure the business operations of the Company in 1. The Company shall schedule meetings of committees compliance with the relevant laws, rules and regulations. and give prior notice to directors in order for them to 9. The Board of Directors and the Audit Committee shall allocate time to attend each meeting. provide an opinion relating to adequacy of the internal 2. The Chairman of the Board of Directors and the President control system in the Annual Report. shall jointly consider selecting important matters to be included in the agenda of the Board of Directors’ Meeting, Segregation of Roles and Duties between the Board of whereby each director is free to propose any matters to Directors and the Management the agenda. The Company has the roles and duties between the Board 3. The Company delivers supporting documents of the of Directors and the Management clearly segregated, Board of Directors’ Meeting to the Board of Directors in namely, the Board of Directors shall have duty to set out advance prior to the meeting date. the Company’s policies and supervise the Management’s 4. The Chairman of the Board of Directors shall allocate operations while the Management shall have the duty to adequate time to allow the Management to propose any handle various administration affairs to ensure compliance matters and directors/committee members to thoroughly with the policies set out by the Board of Directors. Therefore, discuss important issues. the Chairman of the Board of Directors and the President 5. In the Board of Directors’ Meeting, the President, including

Annual Report 2013 Bangkok Metro Public Company Limited 103 high ranking executives, shall attend each meeting in every quarter. In 2013, there was report on the atten- order to provide further detailed information as they are dance at meetings of each director (number of meetings directly involved in the issues. attended / number of meetings held) by separating each 6. The Board of Directors shall regularly meet at least meeting attended by each director as follows:

Names of Directors Audit Committee Executive Committee Nomination and Risk Committee Remuneration Committee 1. Mr. Plew Trivisvavet - 9/9 1/1 - 2. Mr. Supong Chayutsahakij - 9/9 - - 3. General Chetta Thanajaro 4/5 - 1/1 - 4. Mr. Vitoon Tejatussanasoontorn 5/5 - 1/1 - 5. Lieutenant General Surat Sumrith 5/5 - - - 6. Mrs. Vallapa Assakul - - - 3/3 7. Dr. Sombat Kitjalaksana - 7/9 - - 8. Mrs. Kritaya Sumitanant - - - - 9. Miss Dachanee Euarchukiat - - - - 10. Mr. Werapong Suppasedsak - - - - 11. Mr. Chaiwat Utaiwan - 9/9 - 3/3 12. Mr. Witoon Hatairatana - - - 2/3 13. Mr. Visuit Boreriboon - - - 3/3 14. Miss Veena Tachachainirun - - - 3/3 15. Mr. Chatchaporn Triwimol /1 - - - 3/3 Note : /1 Manager of the Safety and Quality Department shall serve as member and secretary to the Risk Committee.

Evaluation of Performance of the Board of Directors Management, and Self-Development of Directors and and the President Development of the Management. Overall, an average score The Company evaluates performance of the Board of represented 88%. Directors and the President on a yearly basis as the Average score in each item is as follows: framework for review of performance of the Board of Directors and determination of remuneration of the President, by determining the criteria for evaluation as a norm for Item Average Score comparison and analysis. The Board of Directors shall 1. Structure and Qualifications of the Board of Directors 89% participate in consideration of performance and problems 2. Roles, Duties and Responsibilities of the Board of Directors 86% for further improvement, correction and development. 3. The Board of Directors’ Meetings 87% The Board of Directors Performance Evaluation Form is 4. Directors’ Duties 90% divided into six subjects, as follows, Structure and 5. Relations with the Management 89% Qualifications of the Board of Directors, Roles, Duties and 6. Self-Development of Directors and Development of the Management 86% Responsibilities of the Board of Directors, the Board of Directors’ Meetings, Directors’ Duties, Relations with the

Annual Report 2013 104 Bangkok Metro Public Company Limited Development of Directors Exchange of Thailand, and the auditor of the Company on Directors understand their roles, duties and responsibilities, a regular basis. have sufficient knowledge and understanding of the Company’s business, pay attention to significant information or news In case of new director, the Company shall arrange for an relating to economic and industrial conditions, changes in orientation for new director for information on the Company’s rules and regulations and the state of competition, which business overview, shareholding structure, committees, allow directors to efficiently perform their duties. In this regard, organization chart, financial position and results of operations, all directors of the Company passed training courses relating management of train operations and maintenance, including to performance of duties as directors, organised by the Thai guidelines for directors of listed companies in the Stock Institute of Directors (IOD). The Company encourages its Exchange of Thailand and relevant laws, as well as visiting directors to further study and attend training courses to the Operations Control Centre and Depot, and provide such enhance their knowledge. In 2013, a director attended training director with relevant essential documents, such as, the course in the Directors Accreditation Program (DAP) to Company’s information, the Code of Conduct and Business enable director to perform duties in accordance with the Ethics, the Listed Companies’ Director Handbook, the fiduciary duties and the good corporate governance instructions on provision of information technology for the listed principles. Moreover, the Company supports its directors companies’ management, the Public Limited Companies Act to attend training courses or participate in activities or B.E. 2535 (1992), the Securities and Exchange Act (No. 4) seminars as organised by the Office of the SEC, the Stock B.E. 2551 (2008), Summary Criteria for Related Party Transactions of Listed Companies, etc.

Annual Report 2013 Bangkok Metro Public Company Limited 105 15. Corporate Social Responsibilities: CSR

The Company has operated its business by adhering to the Moreover, the Company focuses on transparency and sustainable development policies, which are divided into five fairness in selection of its partners along with support of fair key subjects, i.e., quality policy, safety policy, energy saving treatment of labour, and establishes an eco-friendly policy, environmental policy and corporate governance procurement policy. The Company has taken care of its policy. The Company is socially responsible in every process staff by way of competency development towards Happy (CSR IN PROCESS), as part of the Company’s missions to Work Place, and also taken care of society by way of career provide the mass rapid transit rail service with safety, development and promotion of education, environmental convenience, rapidity, reliability and punctuality in order to management system, eco-friendly procurement, renewable alleviate the traffic problems, protect the environment and resources utilisation, and support of environmental improve the quality of life. In addition, the Company set innovations. In 2013, the Company participated in NOVA out its sustainability development roadmap since 2003, and Phase 16 Management Meeting 2013 in Brussels, Belgium, has continued its monitoring and report on the results to the which is annually organised by RTSC (The Railway Quality Management System Committee and the Board of Technology Strategy Centre) in association with Brussels Directors. Furthermore, the Sustainable Development STIB, in order for members to share and exchange topics Reports have been prepared in accordance with the of their interest and advancement of the mass rapid transit international frameworks of the International Association of rail operations. The Company also jointly signed the Public Transport (UITP) and subject to management system Memorandum of Agreement on Cooperation Network for standards in order to enhance the satisfaction and bonding Development of Manpower and Expertise in Rail System of service users and all groups of stakeholders, namely, Technology of the Country. staff, customers, partners, society and the environment.

Annual Report 2013 106 Bangkok Metro Public Company Limited In 2013, the Company initiated various projects and activities fold measurements, together with food nutrition knowledge to promote the efficient use of resources and energy saving by Thai Heart Foundation under Royal Patronage, and awareness, namely: lung function test, health threats of smoking by Thai 1. The “Return the Metro Cards for Environmental Protection Health Promotion Foundation (THPF), to passengers and Sustainable Social Development” campaign, which and general public. has been continuously organised since 2007, to promote 2. The energy saving campaign, which has been continuously the MRT users to jointly return the expired metro cards organised since 2006, mostly related to the air conditioning in order to reduce the number of cards in the system to system, the air ventilation system, the metro operation reduce the use of resources, plastic rubbish and waste system, and the lighting system, namely, campaign for which may be produced by the production process of reducing electricity consumption of the metro operation new cards, including reduction of cost of disposal of system, campaign for reducing electricity consumption electronic cards, as part of the environmental protection. in all 18 stations, campaign for reducing electricity Every card returned at the drop boxes in stations rep- consumption in the depot, etc. resents Baht 10 donation to be contributed for improve- 3. The Water Management System, namely, wastewater from ment of the quality of life in various forms, such as, edu- every area would be transmitted into the wastewater cation and public health through activities in response to treatment system for treatment before being discharged needs and livelihood of communities. In 2013, the into public water sources and certain amount of the Company used monies from such project to hold activ- water would be recycled for reuse in various activities, ities, such as, Share 2 Child and M Care activities for such as, carriage cleaning, plant watering, etc. development of the quality of life in terms of education 4. The Garbage Management System, campaign for its to provide knowledge on public health to passengers and staff to sort garbage for proper treatment so as to save communities surrounding the MRT routes and general time and costs incurred by the disposal process; and people, including other social contribution activities in facilitate the reuse process. special occasions, as follows: 5. The Box Keeping Gang, campaign for recycling beverage boxes to produce educational equipment, such as, desks, Activity for Development of Quality of Life on Education: chairs, etc. The Company brought students from schools along the 6. The One Lid One Dream Sharing Prosthetic Legs, MRT routes to go sightseeing for exchanging outdoor campaign for collecting unused aluminium lids for delivery experiences and join the Wichit Monthien Dramatic Art to the Prostheses Foundation of H.R.H. The Princess Contest at the King Rama II Commemorate Day Fair Mother and the Association for Persons with Physical (King Rama II Memorial Park). On this occasion, the Disabilities. Company also organised a “Lucky Eggs” booth to earn 7. The Paper Conversion with InfoZafe, campaign for money for contribution to the King Rama II Foundation disposing of two-sided used papers for recycling. Praboromrachanusorn under Royal Patronage, and Share 2 Child activity, by encouraging children to have (Details are described in the Sustainable Development outdoor learning experience in various aspects and Report 2013, which is available for download at www. travel by the MRT system. bangkokmetro.co.th/.)

Activity for Development of Quality of Life on Public Anti-Corruption Health: The Company realises and gives priority of anti-corruption The Company, in association with its partners, organised and fraud prevention, both inside and outside its organisation, the M Care activity under the Return the Metro Cards the Company thus establishes guidelines for proper conduct for Environmental Protection and Sustainable Social via the Code of Conduct and Business Ethics of the Company. Development Project at Sukhumvit Station, such as, the In addition, the Company provides for channels for contact activity to provide knowledge relating to safe journey, or submission of complaints directly to the Audit Committee free health check-up with Kluaynamthai hospital, skin- on any matters which may cause damage to the Company.

Annual Report 2013 Bangkok Metro Public Company Limited 107 16. Internal Control and Risk Management

The Company realises the significance of the efficient internal follows: control system, to prevent, administer and manage risks Control Environment which may occur to the Company and its stakeholders. The The Company properly organises its organisation structure. Company then arranges for a proper and adequate internal The Board of Directors is independent from management. control system in its operations in order to meet the goals, Management is authorised to issue appropriate orders under objectives, laws and other relevant requirements. The the Board of Directors’ supervision, in order to allow management to perform works efficiently. The goals and Company also sets out a risk management policy and guidelines for work performance are clear and measurable, arranges for an integrated risk management for its entire and the policy and procedures for work performance, organisation, to ensure effectiveness and in accordance including the code of conduct, are prepared in writing. This with the goals specified by the Company. The Company is to prevent any damage which may be caused to property has appointed the Risk Committee to provide opinions and of the Company and the Subsidiary, and any chance of suggestions to management, to ensure that the risk management and staff’s abuse for personal interests. management is proper and covers all significant issues. The Company has complied with ISO 31000:2009 Risk Risk Assessment Management Principles and Guidelines. The Board of Directors has appointed the Risk Committee, with the duties to consider setting out a risk management Risk Management policy, risk management plan and measures in its business Bangkok Metro Public Company Limited recognises that a operations, as well as monitoring and reviewing the risk management process is an important element for the Company’s overall risk management to stay at an appropriate Company to foresee various risks, so as to be prepared and level, to ensure efficient and effective risk management. respond to changes in business conditions in an appropriate The working team comprises executives at division manager level from all work units of the organisation, to conduct the and timely manner, with potential opportunity for a risk assessment of their responsible units and jointly prepare sustainable growth of its business. an overall risk management plan for the organisation which will be further submitted to the Risk Committee, to assure The Company treats the risk management as part of its the appropriateness and adequacy of the Company’s internal working process and continues to promote staff’s knowledge control system. and understanding of the risk management and participation in analysis and suggestions of risk management measures. With respect to safety, which is regarded as the heart of the mass rapid transit service, the Company has established The Board of Directors and the Audit Committee have the Safety Committee to prepare, adopt, improve and considered and evaluated the adequacy of the internal control develop safety management systems efficiently and system, and concluded that the Company’s internal control continuously. There are also four safety subcommittees, system is adequate and appropriate in various aspects, namely, Risk Control Subcommittee, Train Operation comprising five components, i.e., control environment, risk Documentation Subcommittee, Contractor Safety assessment, control activities, information and communication, Subcommittee and Occupational Health and Working and monitoring activities, which could prevent management’s Environment Subcommittee. improper or unauthorized use of property of the Company Control Activities and the Subsidiary, and no material fault in the internal The Company has clearly determined in writing the scope control system was found. The results are described as of authorities and duties and the budget approval of

Annual Report 2013 108 Bangkok Metro Public Company Limited management at each level. In addition, in executing any Monitoring Activities transactions with major shareholders, directors, management The Company has monitored the results of operations as or their related persons, the Company has imposed strict compared to the strategic plan, along with the Internal Audit measures to monitor and prevent a conflict of interests in Office’s regular review of compliance with the internal control order to secure the best interests of the Company. The system. In case where any material flaw is found, the matter Subsidiary’s operations has been regularly monitored, with will be reported to the Board of Directors/Audit Committee guidelines for compliance with by such persons appointed for consideration and instruction for correction, and the by the Company to hold office as directors or executives in development of such correction will be reported accordingly. the Subsidiary. In addition, the Company has a policy requiring management to immediately report to the Board of Directors on any fraud, Information & Communication violation of law and other unusual acts which may materially The Company realises the significance of the information & affect the Company’s reputation and financial position. communication systems, which will ensure that the Company’s information is correct, complete and sufficient Moreover, the Company assigns the Quality Management for decision-making by management and the Board of System Committee and the Safety Committee to set out Directors. All documents in support of bookkeeping will be plans and provide facilitation, prepare and develop the filed and organized by category, and accounting policies in Company’s management systems in respect of quality, accordance with generally accepted accounting principles safety and environment of the Company, with the Safety are adopted as appropriate to the Company’s nature of and Quality Unit directly reporting to the Managing Director, business. In this regard, the Company has established a which has the duties to monitor compliance with the internal working team to supervise the information security, and control system pertaining to quality and safety, to ensure prepare manuals for information security, which cover various the quality and safety, as well as regular improvement of key subjects in accordance with IEC17799 Standards, for its efficiency and effectiveness. example, categorisation and prevention of standard information of personnel to ensure security of the organisation; In 2013, the Secretary to the Audit Committee, Mr. Preecha physical and environmental security, computer processing Sudsup, Senior Manager, Office of the Internal Audit, held management, authorisation of access to information, such position until 19 November 2013. Currently, The information system management and development, software Company is recruiting a Head of Internal Audit. administration and management, communication system and network security, as well as business continuity management based on information system, etc.

Annual Report 2013 Bangkok Metro Public Company Limited 109 17. Audit Committee’s Report for 2013

The Audit Committee of Bangkok Metro Public Company Limited was appointed by resolution of the Ordinary General Meeting of Shareholders, comprising three independent directors, namely, General Chetta Thanajaro, as the Chairman of the Audit Committee, Mr. Vitoon Tejatussanasoontorn and Lieutenant General Surat Sumrith, as the Audit Committee members. In 2013, the Audit Committee had five meetings with the high level executives and the management of the Company to independently consider the issues as assigned by the Company’s Board of Directors, in accordance with the regulations of Bangkok Metro Public Company Limited on the rules and guidelines for practice of the Audit Committee in line with the requirements of the Stock Exchange of Thailand and the Charter of the Audit Committee, as may be summarized as follows: 1. The Audit Committee reviewed the quarterly and 2013 annual financial statements in compliance with generally accepted accounting standards so as to ensure the correctness and reliability of the accounting system and its financial reports, as well as the sufficient disclosure of information in the financial statements, including review of related party transactions between the Company, its Subsidiary and related companies to ensure that the Company has executed the transactions in the ordinary course of business and in accordance with the rules as set forth by the Stock Exchange of Thailand, with sufficient information disclosure, for the benefits of investors. In review of the financial statements and compliance with applicable regulations and laws, the Audit Committee is of the opinion that the Company has complied with the applicable laws, and its accounting system and financial reports are correct and reliable, and the related party transactions between the Company, its Subsidiary and related companies are in the ordinary course of business. 2. The Audit Committee reviewed the evaluation of the Company’s internal control system and the monitoring of correction of material faults in the internal control system conducted by the Office of Internal Audit, and then concluded that the Company has the internal control system which is sufficient for the business operations and achieves the objectives of the internal control in respect of effectiveness and efficiency of its operation, resource utilization, reliability of the financial reports and results of operations, compliance with laws, rules and regulations of the authorities and contractual obligations.

Annual Report 2013 110 Bangkok Metro Public Company Limited 3. The Audit Committee considered, selected, nominated and proposed the remuneration for the Company’s auditor to the Board of Directors to seek approval of the 2013 Annual Ordinary General Meeting of Shareholders for appointment of the certified public accountant of Ernst & Young Office Limited as the Company’s auditor for 2013. 4. The Audit Committee supervised the internal audit to be in line with the approved plan by reviewing the audit report for 2013 so as to ensure efficient and effective operation with good internal control system and compliance with the law on securities and exchange or the law relating to the business of the Company, and follow up the correction in accordance with the audit report in material issues for the good corporate governance. 5. The Audit Committee considered disclosing the Company’s correct and complete information on any related party transaction or transaction which might give rise to a conflict of interests, in order to prevent a risk from inaccurate disclosure, to the best interests of the Company and its shareholders. 6. The Audit Committee prepared the Corporate Governance Report as disclosed in the Company’s Annual Report and signed by the Chairman of the Audit Committee for shareholders to review the Company’s good corporate governance.

The Audit Committee has performed its authorities and duties of the Audit Committee as specified in the Charter of the Audit Committee in all respects. In addition, the Audit Committee has considered the audit plan for 2014 which was prepared based on the risk assessment. The scope of the audit plan covers all material issues, to ensure the review of the appropriateness of the internal control and the risk management of the Company, for the optimum benefits of the Company and its shareholders. Moreover, the Audit Committee has also considered the independence of the internal audit unit and the auditor, as well as attending the meeting with the auditor without the management once a year. Furthermore, the Audit Committee provided the opinion and proposed to the Board of Directors to seek approval of the 2014 Annual Ordinary General Meeting of Shareholders for appointment of either Miss Siraporn Ouaanunkun, Certified Public Accountant No. 3844, and/or Mr. Narong Puntawong, Certified Public Accountant No. 3315, and/or Mr. Supachai Phanyawattano, Certified Public Accountant No. 3930, of Ernst & Young Office Limited as the Company’s auditor for 2014, with the auditing fee in the total amount of not exceeding Baht 1,325,000.

Signed: General______(Chetta Thanajaro) Chairman of the Audit Committee

Annual Report 2013 Bangkok Metro Public Company Limited 111 18. RelatedParty Transactions 112

Bangkok MetroPublicCompany Limited Annual Report 2013 Transactions with persons who may have conflict of interest in 2013 and 2012.

Persons/Juristic Transaction Value (Baht) persons who may have Relationship Nature of Transaction Necessity/Details Opinion of the Audit Committee conflict of interest 2012 2013 1. CH. Karnchang - CH. Karnchang Public Company The Company - Letter of guarantee fee for submission of - The fees are based on the ordinary Public Company Limited is a major shareholder of the - Construction and other 500,000.00 1,000,000.00 proposal for investment in the MRT Purple terms applied by the commercial Line Project, Bang Yai - Bang Sue Section, Limited Company, with 30.19% of shares in payables was advanced by CH. Karnchang Public banks in respect of major clients. the Company as at 13 January 2014. Company Limited amounting to Baht - Mr. Plew Trivisvavet, the Chairman of 800,000 to Krung Thai Bank Public the Board of Directors and the Company Limited and Baht 200,000 to Thanachart Bank Public Company Limited. Chairman of the Executive Committee - Long-term loans 3,000,000,000.00 - - The Company entered into loan agreements of the Company, is also director, with CH. Karnchang Public Company - The transactions are in accordance executive director and in the Limited in 2005 in the total amount of Baht with the Sponsor Support management of CH. Karnchang - Accrued interest 980,987,601.86 - 1,403 million, and in the 9-month period in Agreement. The interest rate and 2006 in the total amount of Baht 512 million. Public Company Limited. These loans were subordinated and interest terms of payment are in - Dr. Sombat Kitjalaksana, a director was charged at the rate of MLR+0.5% per accordance with the conditions as and Vice Chairman of the Executive - Interest expenses 235,031,919.74 222,945,205.49 annum, to finance the working capital. The specified by the syndicated lenders. Committee of the Company, is also a (arising from the principal and interest are due and payable when the Company completely makes director of CH. Karnchang Public Company’s borrowing of repayment of loans under the main Company Limited. loans from CH. agreement or when the Company has Karnchang Public excess cash. However, the Company made Company Limited as a partial repayment of loans in the amount of Baht 911.91 million and the accrued sponsor support) interest in the amount of Baht 89.98 million in September 2006. In 2008, 2009, 2010, 2011 and 2012, the Company has signed additional loan agreements with CH. Karnchang Public Company Limited, totalling Baht 580 million, Baht 600 million, Baht 450 million, Baht 330 million, and Baht 36.91 million, respectively, to finance the working capital. Later, in December 2013, the Company made the full repayment of the principal of the long-term loan and accrued interest to CH. Karnchang Public Company Limited in the total amount of Baht 4,204 million. Persons/Juristic Transaction Value (Baht) persons who may have Relationship Nature of Transaction Necessity/Details Opinion of the Audit Committee conflict of interest 2012 2013 1. CH. Karnchang - CH. Karnchang Public Company - Other fees 246,735.53 - - Standby L/C fee of 2012 for the Sponsor - The fees are based on the ordinary Public Company Limited is a major shareholder of the (Guarantee) Loan Agreement was advanced to Krung terms applied by the commercial banks Limited (Continued) Company, with 30.19% of shares in Thai Bank Public Company Limited by in respect of major clients. the Company as at 13 January 2014. CH. Karnchang Public Company Limited. - Mr. Plew Trivisvavet, the Chairman of the Board of Directors and the Chairman of the Executive Committee of the Company, is also director, executive director and in the - Metro Mall Development Limited hired - The contract was made with clear terms management of CH. Karnchang CH. Karnchang Public Company Limited of payment. Public Company Limited. Bangkok Metro Networks for a project value of Baht 292.5 million CH. Karnchang Public Company - Dr. Sombat Kitjalaksana, a director Limited to construct the interior of the train stations Limited is an experienced and and Vice Chairman of the Executive (Since 25 February 2009, to support the lease of retail shops. specialised company in this type of However, since Metro Mall Development work and was also responsible for the Committee of the Company, is also a three Subsidiaries, Limited had insufficient revenue from civil infrastructure work in relation to director of CH. Karnchang Public namely, Metro Mall commercial development, it was not yet each train station. CH. Karnchang Company Limited. Development Limited, able to pay the construction cost. CH. Public Company Limited has Triads Networks Karnchang Public Company Limited information of electric systems and civil Company Limited and charged interest to Metro Mall Development work, which would enhance the BMCL Network Limited, Limited at the rate of MLR+1% per efficiency in construction of such were amalgamated.) 192,288,850.60 192,288,850.60 annum. After 25 February 2009, Metro project. - Project cost Mall Development Limited was A memorandum of agreement, dated 3 amalgamated with two Subsidiaries into June 2005, was executed amending Bangkok Metro Networks Limited (BMN), the original contract stipulating certain BMN then accepted the transfer of all conditions and the interest rate arising - Construction payables 130,185,780.95 60,185,780.95 obligations under the existing from the delay in payment. The agreement. Later, in December 2013, interest rate charged by CH. Karnchang

Bangkok MetroPublicCompany Limited - Accrued interest 10,657,600.49 596,595.44 the payment of partial construction cost Public Company Limited is in line with was made to CH. Karnchang Public the rate that CH. Karnchang Public Company Limited in the amount of Baht Company Limited charges other 70 million. In 2013, the payment of the customers and close to the rate that - Interest expenses 10,657,600.49 10,293,911.20 accrued interest was gradually made in Bangkok Metro Networks Limited may

Annual Report 2013 the average amount of Baht 0.8 million borrow from commercial banks. In per month. 2013, the payment of partial construction cost and accrued interest was made.

113 114 Bangkok MetroPublicCompany Limited Annual Report 2013

Persons/Juristic Transaction Value (Baht) persons who may have Relationship Nature of Transaction Necessity/Details Opinion of the Audit Committee conflict of interest 2012 2013 1. CH. Karnchang - CH. Karnchang Public Company Bangkok Metro Networks Limited is a major shareholder of the Limited (BMN) Public Company - BMN entered into the office space lease Limited (Continued) Company, with 30.19% of shares in - Administrative expenses 6,445,876.30 6,616,633.24 agreement in Viriyathavorn Building with - This rental rate is comparable to the the Company as at 13 January 2014. (arising from the rental CH. Karnchang Public Company Limited, rental rates charged by the lessor to - Mr. Plew Trivisvavet, the Chairman of of office space and with a term of three years until 9 February third party lessees, which range the Board of Directors and the public utilities expenses) 2016, on the 12th Floor, covering a total Baht 320-370 per square metre per area of 651.24 square metres, and on Chairman of the Executive Committee the 9th Floor, covering a total area of month. of the Company, is also director, 640.16 square metres. The rental and executive director and in the service charge rate is Baht 350 per management of CH. Karnchang square metre per month.

Public Company Limited. - Construction and other 73,739.29 66,536.83 - Office tap water and electricity charges - Dr. Sombat Kitjalaksana, a director payables to the 9th and the 12th Floors, and Vice Chairman of the Executive Viriyathavorn Building, were accrued for Committee of the Company, is also a December 2013. director of CH. Karnchang Public Company Limited. - Other non-current assets 1,355,970.00 1,395,044.40 - Deposits for the rental and service (Deposits) charges to the 9th and the 12th Floors, Viriyathavorn Building.

2. CK. Office Tower - CK. Office Tower Co., Ltd. is an Bangkok Metro Networks associated company with common Limited Co., Ltd. directors. - CK. Office Tower Co., Ltd. has interests in - Administrative 31,401.88 21,308.39 - Parking space service charges of the - This parking space service charge the Company through its 5.51% holding of expenses contractual parties between CK. rate is comparable to the service shares in CH. Karnchang Public Company Office Tower Co., Ltd. and Bangkok charge rates charged by the lessor Limited as at 19 September 2013. Metro Networks Limited. to third party lessees. - The major shareholders of CK. Office Tower Co., Ltd. are Mahasiri Siam Company Limited and the Trivisvavet Family, holding 25% and 75% in CK. Office Tower Co., Ltd., respectively. - Mr. Plew Trivisvavet, a director of CK. Office Tower Co., Ltd., is the Chairman of the Board of Directors and the Chairman of the Executive Committee of the Company. Persons/Juristic Transaction Value (Baht) persons who may have Relationship Nature of Transaction Necessity/Details Opinion of the Audit Committee conflict of interest 2012 2013 3. CKET Joint Venture - CKET Joint Venture is an associated The Company company. CKET Joint Venture is a joint venture between CH. Karnchang Public - Other non-current assets 11,500,000.00 11,500,000.00 - The Company hired CKET, for a total - The contract was made with clear Company Limited and Expert Transport contractual value of Baht 7 million, as Company Limited at 99.99% and 0.01%, (Advance payment for terms of payment. respectively. CH. Karnchang Public project work) consultant for the MRT Purple Line, with Company Limited holds 30.19% of shares in a contract term of 6 months (September the Company. 2010 - February 2011): Baht 2 million of - Mahasiri Siam Company Limited holds 90% September 2010 and Baht 1 million per of shares in Expert Transport Company month during October 2010 - February Limited. The Trivisvavet Family holds 93% 2011. Moreover, the Company of shares in Mahasiri Siam Company executed an additional contract to hire Limited. CKET, for a total contractual value of - Mr. Plew Trivisvavet, the Chairman of the Board of Directors and the Chairman of the Baht 4.5 million, with a contract term of Executive Committee of the Company, is 3 months (March 2011 - May 2011): also director, executive director and in the Baht 1.5 million per month. The management of CH. Karnchang Public provision of consulting service covers Company Limited. the preparation for submission of the - Dr. Sombat Kitjalaksana, a director and tender documents for the supply of the Vice Chairman of the Executive Committee M&E Systems and O&M Services to the of the Company, is also a director of CH. MRT Purple Line Project, Bang Yai - Karnchang Public Company Limited. Bang Sue Section. 4. Mass Rapid Transit - The Mass Rapid Transit Authority of The Company Authority of Thailand Thailand holds 2,987.5 million shares, - Other non-current assets 467,289.72 467,289.72 - Fee for TOR documents of the MRT - The transaction is in accordance representing 14.57% of shares in the (Advance payment for Purple Line Project. with the conditions of the tender Company as at 13 January 2014. project work) documents. - Mrs. Kritaya Sumitanant, executive of the MRTA, is a director of the Company. - Miss Dachanee Euarchukiat, - Remuneration payable 23,624,491.38 7,524,278.20 - The Company agrees to pay - The transaction is in accordance Bangkok MetroPublicCompany Limited subcommittee member of the MRTA, is from revenue and others remuneration to the MRTA from the with the conditions of the a director of the Company. fare revenue and commercial Concession Agreement with which development revenue amounting to the Company is required to comply. - Remuneration from fare 18,498,645.81 19,686,722.31 Baht 7.51 million and electric revenue charges for elevators, park and ride Annual Report 2013 building, basement at the Lat Phrao Station, for December 2013 - Remuneration from 38,766,156.25 61,560,168.98 amounting to Baht 19,000. commercial development revenue 115 116 Bangkok MetroPublicCompany Limited Annual Report 2013

Persons/Juristic Transaction Value (Baht) persons who may have Relationship Nature of Transaction Necessity/Details Opinion of the Audit Committee conflict of interest 2012 2013 4. Mass Rapid Transit - The Mass Rapid Transit Authority of - Electricity charges 112,391.25 123,592.41 - Electricity charges for elevators, park and - The transaction is the expense Authority of Thailand Thailand holds 2,987.5 million shares, (Cost of fare box) ride building at the Lat Phrao Station. which was made and paid under the (Continued) representing 14.57% of shares in the Agreement. Company as at 13 January 2014. - Electricity charges 81,558.50 90,134.57 - Electricity charges for the basement at - Mrs. Kritaya Sumitanant, executive of (Cost of commercial the Lat Phrao Station. the MRTA, is a director of the development) Company. - Prepayment for insurance premiums for - Miss Dachanee Euarchukiat, Bangkok Metro Networks property and third party liability in the subcommittee member of the MRTA, Limited vicinity of the Interchange Building at the is a director of the Company. - Prepaid Expenses 204,828.69 215,923.79 MRT Sukhumvit Station in respect of the - The transaction is made and paid MRTA’s property. under the Agreement. - Performance bond and insurance for - The transaction is the expense - Other non-current assets 556,255.35 556,255.35 using the area for advertising board which was made and paid under the installation at the Interchange Building at (Deposit) the MRT Sukhumvit Station. Agreement. Bangkok Metro Networks Limited (BMN) - BMN executed an agreement permitting - Cost of commercial 2,051,796.00 2,154,385.80 for use of the area for advertising board - The rental rate of such advertising development installation in the vicinity of the media is reasonable. (Remuneration from Interchange Building at the MRT commercial develop- Sukhumvit Station, covering an area of ment revenue) 112.12 square metres, with a contract term of 3 years, since 1 September 2011 - 31 August 2014. - Other expenses 415,634.12 449,635.43 - Building and land taxes amounted to - The transaction is in accordance (Building and land taxes Baht 307,769.40 ; insurance premiums with the conditions of the and insurance for property and third party liability Agreement. premiums) amounted to Baht 4,473.41; electricity charges amounted to Baht 136,458.04; and public relations cost amounted to Baht 934.58. 5. Suvarnabhumi - Mr. Chaiwat Utaiwan, Chairman of the The Company 62,990.65 - - Expenses in the reception banquet for - This service charge rate is an Airport Hotel Company Board of Directors of Suvarnabhumi - Administrative the management on April 20, 2012. ordinary rate charged to general Airport Hotel Company Limited, is expenses customers. Limited currently the President, director and Executive Committee Member of the Company. Necessity and Justification of the Related Policy or Future Trend of Related Party Party Transactions Transactions At the Meetings of the Board of Directors No. 2/2013 on 9 May The Company shall comply with the rules and regulations 2013; No. 3/2013 on 31 July 2013; No. 5/2013 on 11 November of the Securities and Exchange Commission and the Stock 2013; and No. 1/2014 on 25 February 2014, the Audit Exchange of Thailand, including the rules on the disclosure Committee jointly considered and reviewed the related of related party transactions as well as acquisition and party transactions, with the Company’s management, and disposition of significant assets of the Company or its opined that the transactions between the Company and Subsidiary and the accounting standards as prescribed by persons and/or juristic persons who may have a conflict of the Federation of the Accounting Professions. If there are interest were justified and necessary for the Company’s transactions which may give rise to conflict of interest in business operations in accordance with the measures for the future, such as, hiring a group of persons who may have the approval of related party transactions as described conflict of interest to carry out construction, project below. management, project maintenance, the Board of Directors, with the Audit Committee, shall consider the necessity and Measures or Steps for the Approval of justification of such transactions, including the pricing and Related Party Transactions terms of the transactions, which must be based on the The Company complied with the rules and regulations of ordinary course of business. The price must also be the Securities and Exchange Commission and the Stock compared with the price applicable to third parties or the Exchange of Thailand. In the case where the Company is market price. A person who has any interest shall not be entering into a related party transaction that may give rise allowed to participate in the consideration and approval of to a conflict of interest, such a transaction must be approved the transactions. The Company has no policy to extend or by the Board of Directors and the Audit Committee would guarantee a loan for a person who may have a conflict of consider the justification of the transaction whilst taking into interest under the definition of the SEC. account the best interests of the Company. The pricing and terms of the transaction must be based on the ordinary In case that the Audit Committee does not have expertise course of business and must be a fair price or be comparable to consider any particular related party transaction which to the market price. Furthermore, any person who has any may take place, the Company shall arrange for an independent interest or who may have a conflict of interest in connection expert or the Company’s auditor to opine on such related with such transaction shall not be allowed to participate in party transaction to support the decision-making of the the consideration and approval of such transaction. In this Board of Directors and/or the Audit Committee or the regard, the Board of Directors’ Meeting No. 3/2008 held on shareholders, as the case may be. The Company will 11 August 2008 resolved to grant approval in principle for disclose the related party transactions in the notes to the the trade agreement under the general commercial terms financial statements that have been reviewed or audited by that should such those transactions have such commercial the Company’s auditor. terms as that one should treat towards his/her contractual party under the same circumstances by virtue of power to negotiate on trading without his/her influence due to the capacity as director, executive or related party in execution of transactions between the Company and its Subsidiary with directors, executives or related party to ensure compliance with Section 89/12 of the Securities and Exchange Act (No. 4) B.E. 2551 (2008).

Annual Report 2013 Bangkok Metro Public Company Limited 117 19. Management Discussion and Analysis

19.1 SIGNIFICANT FINANCIAL RATIO

Description 2011 2012 2013 LIQUIDITY RATIO Fare Box Ratio (times) 1.26 1.45 1.60 Liquidity Ratio (times) 0.33 0.32 3.41 Quick Ratio (times) 0.24 0.21 3.22 Cash Flow Ratio (times) (0.37) 0.03 (4.92) Trade Receivable Turnover (times) /1 6.78 5.50 7.03 Average Collection Period (day) /1 53.1 65.45 51.18 Cash Turnover (day) n.a n.a n.a PROFITABILITY RATIO Gross Profit Ratio (%) /2 25.84 34.56 42.01 EBITDA Ratio (%) 13.64 24.27 33.00 Operating Margin (%) (3.00) 9.06 18.43 Other Margins (%) 13.52 13.21 16.97 Cash to Profitability Ratio (%) n.a. n.a. n.a. Net Profit Margin (%) (60.64) (42.92) (30.51) Return on Equity (%) (46.95) (70.12) (16.14) EFFICIENCY RATIO Return on Assets (%) (6.23) (5.32) (4.00) Return on Fixed Assets (%) (4.58) (3.50) (2.27) Assets Turnover (times) 0.10 0.12 0.13 FINANCIAL POLICY RATIO Debt to Equity Ratio (times) 8.48 17.87 1.33 Interest Coverage Ratio (times) n.a. n.a. n.a Cash Basis (times) n.a. n.a. n.a Dividend Payout Ratio (%) 0.00 0.00 0.00 PER SHARE RATIO /3 Weighted average number of ordinary shares (million shares) 11,950.00 11,950.00 12,257.75 Loss per share (Baht per share) (0.10) (0.08) (0.06) Number of Ordinary Shares at End of Period (million shares) 11,950.00 11,950.00 20,500.00 Loss per share (Baht per share) (0.10) (0.08) (0.04) Book Value (Baht per share) 0.16 0.08 0.43

Remarks: /1 Calculated from trade receivables from commercial development revenue since fare revenue would be collected in cash only. Moreover, the Company did not calculate the inventory turnover ratio because the Company’s business nature is a provision of service, therefore, there is no storage of inventory. It was then impossible for the inventory turnover ratio to appropriately indicate the business liquidity. In addition, the Company did not calculate the payable turnover since certain accounting entries may cause the calculation of payable turnover ratio to vary accordingly. /2 Gross Profit Margin (%) = fare box revenue + commercial development revenue - cost of fare - cost of commercial development × 100 fare box revenue + commercial development revenue /3 The aforesaid number of ordinary shares as calculated was determined from the base of book value of Baht 1.0 per share.

Annual Report 2013 118 Bangkok Metro Public Company Limited 19.2 ANALYSIS OF PAST OPERATIONS 19.2.1 OVERVIEW OF THE BUSINESS OPERATIONS Traffic Policy and Planning (OTP), recognised the urgency AND SIGNIFICANT CHANGES of this matter, and then prepared the Mass Rapid Transit People’s travelling in Bangkok can be divided into two Master Plan in Bangkok Metropolitan Region during the next major modes, namely, by personal cars and by public 20 years (2010-2029), covering a total distance of 508 transport systems. In this regard, the major public transport kilometres, comprising new 12 lines of the mass rapid system which accommodates people’s travelling in Bangkok transit system network for the future. Subsequently, the remains public bus service. From the past until now, travelling government had a policy for OTP to coordinate with the by public bus service in Bangkok and its surrounding provinces relevant agencies in charge of the projects, i.e., the State is subject to certain limitations due to sharing of road space Railway of Thailand (SRT), the Mass Rapid Transit Authority with personal cars, which resulted in traffic congestions, of Thailand (MRTA), and Bangkok Metropolitan Administration particularly during rush hours. (BMA), to revise the Mass Rapid Transit Plan in Bangkok Metropolitan Region as appropriate, resulting in merely 10 Considering the increased road space in Bangkok, the road lines, covering a total distance of 464 kilometres. distance in Bangkok has not materially increased since 2005. On the contrary, the number of vehicles registered The Company, as concessionaire for the operation of in Bangkok has continued to rise. The differences between Thailand’s first MRT service, has the right to collect fare box the road-based transport system demand and the road revenue and commercial development revenue for 25 years supply in Bangkok have caused the traffic problems to from 2 July 2004. Over nine years of revenue service, the intensify. Such factor is a key factor which causes an Company has provided its services to more than 628 million increasing number of passengers of the MRT system, due passengers, accounting for approximately 1.28 million trips. to travellers’ change to use the mass rapid transit rail systems This shows that the MRT has become an effective alternative as a more rapid and convenient alternative. and as part of changing lifestyle of Bangkok people. The daily number of passengers of public bus service continues Currently, the Company’s passengers travelling during rush to drop while the number of service users is rising on the hours are rather crowded while the number of passengers mass rapid transit rail systems, which are much more during off-peak hours remains relatively low, yet possible sophisticated, safe, rapid, punctual and convenient, namely, to grow. Therefore, the Company emphasises to increase BTS and MRT. Should the government be unable to build revenue and the number of passengers during off-peak more roads in response to the growing demand, the need hours, promote passengers’ use of metro cards for their for the mass rapid transit rail services will become more convenient and rapid journeys, and boost commercial critical. The government, by the Office of Transport and development revenue from optimisation of space within the MRT system.

Annual Report 2013 Bangkok Metro Public Company Limited 119 On 3 September 2013, the Council of Ministers’ Meeting 19.2.2 RESULTS OF OPERATIONS AND PROFITABILITY resolved to grant approval for MRTA to sign the Agreement In 2013, The Company’s core revenue was derived from for the MRT Purple Line Project, Bang Yai - Rat Burana, the fare box revenue in the amount of Baht 2,106.36 Bang Yai - Bang Sue Section, Contract 4: Concession for million, representing 83.03% of total revenues, whereby Supply of M&E Systems and O&M Services (Khlong Bang such revenue increased by Baht 127.01 million or representing Phai Station - Tao Poon Station) with the Company, for a 6.42%, as compared with 2012, mainly due to an increase concession period of 30 years from the date of execution in the volume of passengers on working days and holidays. of the Agreement, with a total contract value of Baht 82,625 An average daily volume of passengers on working days million (including value added tax). On 4 September 2013, increased to 272,009 trips (representing 7.59%) and an the Company signed such Agreement with MRTA, and average daily volume of passengers increased to 236,811 following the execution of the Agreement with MRTA, the trips (representing 7.53%), as a result of the real property Company signed the Agreement for Project Management development projects around the route, and the increased as well as for Supply and Installation of M&E Systems, with oil price which changed the commuting behavior in the urban CH. Karnchang Public Company Limited, with a total value area towards more use of the metro system; however, the of Baht 20,011 million (including finance cost but exclusive growth rate was declining when compared with 2012. This of value added tax) on 4 September 2013. was because in 2012, fare box revenue rose sharply as high On 11 November 2013, the Extraordinary General Meeting as 20.26% from 2011, resulting from the increasing volume of Shareholders No. 1/2013 of the Company resolved to of passengers and the increased fare rates during mid-2012. approve the Company’s registered capital increase from 2013 obviously remarked the year of growth of commercial 11,950,000,000 to Baht 20,500,000,000 for Right Offering. development revenue, namely, Baht 421.76 million or 16.62% Any remainder of such shares shall be allocated by way of of total revenues, representing an increase by 130.99% or private placement by the Executive Committee or the 45.05% from 2012, which was higher than the growth rate person assigned by the Executive Committee. The proceeds in 2012, as compared with 14.65 % in 2011. Such growth from capital increase shall be used for the additional was due to an increase in revenue from advertising procurement of the railway systems, upgrade and improvement procurement and production business which grew as high of the efficiency of services and operations under the as 37.62%, as a result of the development of new creative Concession Agreement, as well as in general business and unique media, such as, 3D, light, colour, sound and operations of the Company; the repayment of the principal scent to make it more appealing; and the utilisation of new and accrued interest of the loan to the shareholder, i.e., space within stations to generate revenue, for instance, CH. Karnchang Public Company Limited; the repayment of stickers on escalator handrails, benches, and Platform accrued interest of the loans and the payment of rescheduling Screen Doors, etc., including revenue from royalties in fee to the financial institution creditors. In this regard, all telecommunications services with a growth of 95.68%, of the Company’s new ordinary shares were fully subscribed. mainly based on 3G service, not to mention the fact that After the successful capital increase, the Company’s revenue from retail space lease increased at a rate as high shareholding structure has been materially changed, namely, as 25.03% due to the opening of Metro Nine in Phra Ram as at 13 January 2014, CH. Karnchang Public Company 9 Station. Limited became the first major shareholder, with a shareholding percentage of 30.19% (formerly 16.64%); MRTA as the According to the increasing revenues from both segments, second major shareholder, with a shareholding percentage the total revenues of the Company and its Subsidiary for of 14.57% (formerly 25.00%); and Bangkok Expressway 2013 amounted to Baht 2,537.00 million, representing an Public Company Limited as the third major shareholder, with increase by Baht 256.26 million or 11.24% from 2012, a shareholding percentage of 10.00% (unchanged). Moreover, lower than the growth rate in 2011, as compared with 2010 such capital increase has caused the debt to equity ratio of at a growth rate of 19.84%, due to the substantial increase the Company and its Subsidiary to reduce to 1.33 times as in fare box revenue. at the end of 2013, from previously 17.87 times as at the The operating expenses of the Company and its Subsidiary end of 2012. for 2013 amounted to Baht 2,071.16 million, representing a decrease by Baht 3.89 million or 0.19% from the previous

Annual Report 2013 120 Bangkok Metro Public Company Limited year. However, the operating expenses in 2012 represented -42.92% and -70.12% in 2012, respectively, and from -60.64% 90.98% of total revenues while the operating expenses in and -46.95% in 2011, respectively, while the net loss per 2013 represented 81.64% of total revenues, due to the share was Baht 0.06 in 2013, which reduced from Baht 0.10 improved efficiency of its cost and operating expense in 2011 and Baht 0.08 in 2012. management. 19.2.3 LIQUIDITY AND ADEQUACY OF CAPITAL OF The operating expenses of the Company and its Subsidiary THE COMPANY comprised costs of fare box in the amount of Baht 1,316.01 As at 31 December 2013, the Company and its Subsidiary million (representing 51.87% of total revenues), commercial had cash and cash equivalents of Baht 2,194.61 million, development costs in the amount of Baht 150.12 million representing an increase by Baht 2,111.64 million as compared (representing 5.92% of total revenues), amortisation of project to that as at the end of 2012. An increase in cash inflow costs in the amount of Baht 365.40 million (representing was derived from the net cash inflow from financing activities 14.40% of total revenues), and selling and administrative in the amount of Baht 5,544.46 million, mainly due to the expenses in the amount of Baht 239.63 million (representing issuance of capital increase ordinary shares. The cash flow 9.45% of total revenues). Upon comparison with 2012, the from financing activities was used in operating activities in costs of fare box reduced by 3.87% while commercial the net amount of Baht 3,397.26 million, mainly for payment development costs increased by 28.90% in line with the of interest and repayment of accrued interest, and used in growing commercial development revenue; amortisation of investing activities in the net amount of Baht 35.55 million. project costs increased by 5.02% as a result of the increasing volume of passengers; and selling and administrative expenses In 2013, the Company’s fare box ratio equal to 1.60 times, reduced by 3.21%. The finance cost of the Company and representing an increase from 1.45 times and 1.26 times in its Subsidiary for 2013 amounted to Baht 1,228.52 million, 2012 and 2011, respectively, reflecting the improved representing an increase by Baht 42.31 million or 3.57%, efficiency of operations of the Company and its Subsidiary. as compared with the previous year, due to increased fees. In regard to the financial position as at 31 December 2013, As a result of the growing revenues, and the efficient cost the total assets of the Company and its Subsidiary amounted control and management, the results of operations of the to Baht 20,358.90 million, representing an increase by Baht Company and its Subsidiary in 2013 showed EBITDA in the 2,040.58 million or 11.14% from 2012, mainly representing amount of Baht 837.32 million, representing an increase by an increase in cash proceeds from capital increase. Baht 283.70 million or 51.24%, as compared with 2012; and EBIT in the amount of Baht 465.84 million, representing an Other apparent changes in 2013 included a decrease in increase by Baht 260.14 million or 126.47%, whereby the long-term liabilities in respect of accrued interest to the net loss in respect of shareholders’ equity of the Company financial institutions; the repayment of the principal and amounted to Baht 774.00 million, representing a decrease accrued interest of the loan from the shareholder in full; and by Baht 204.92 million or 20.93% from 2012. an increase in shareholders’ equity from proceeds derived from the capital increase. As at 31 December 2013, the All profitability ratios of the Company and its Subsidiary total liabilities of the Company and its Subsidiary amounted improved as compared with 2012 and 2011. In 2013, the to Baht 11,602.83 million, representing a decrease by Baht Company and its Subsidiary had a gross profit margin equal 5,744.50 million or 33.11% from the previous year, and to 42.01%, representing an increase from 34.56% and 25.84% shareholders’ equity of the Company and its Subsidiary in 2012 and 2011, respectively. EBITDA ratio and operating amounted to Baht 8,756.07 million, representing an increase margin in 2013 also increased considerably, namely, equal by Baht 7,785.08 million or 801.77% from the end of 2012. to 33.00% and 18.43%, respectively, representing an increase As such, the debt to equity ratio reduced from 17.87 times from 24.27% and 9.06% in 2012, respectively, and from as at the end of 2012 to 1.33 times as at the end of 2013, 13.64% and -3.00% in 2011, respectively. However, since the and book value increased from Baht 0.08 per share as at Company continued to bear high finance cost, the net profit the end of 2012 to Baht 0.43 per share as at the end of margin and return on equity remained negative yet continued 2013, representing a stronger financial position besides the to reduce. In 2013, the Company and its Subsidiary had growth rate of EBIT. This signifies an improved leverages the net profit margin and return on equity equal to -30.51% of the Company and its Subsidiary although the Company and -16.14%, respectively, representing a decrease from still sustains a net operating loss.

Annual Report 2013 Bangkok Metro Public Company Limited 121 19.2.4 CONTRACTUAL OBLIGATIONS AND help expand the Company’s metro network for extensive OFF-BALANCE SHEET ARRANGEMENTS service coverage in the vicinity of Bangkok and its Please see details in Notes to Financial Statements. surrounding provinces, and also attract more passengers to use the service of the Company’s MRT Blue Line Project. 19.3 FACTORS OR EVENTS WHICH MAY HAVE A MATERIAL IMPACT ON THE The execution of the Concession Agreement for the MRT FINANCIAL POSITION OR OPERATIONS Purple Line Project has affected the Company’s financial IN THE FUTURE position and operations in the future as follows: 19.3.1 EXECUTION OF THE AGREEMENT FOR THE MRT PURPLE LINE PROJECT, BANG YAI - 1. The Company will generate more revenue with improved RAT BURANA, BANG YAI - BANG SUE SECTION, operational results. CONTRACT 4: CONCESSION FOR SUPPLY OF This concession for the MRT Purple Line Project will M&E SYSTEMS AND O&M SERVICES (KHLONG allow the Company to generate revenue from the service BANG PHAI STATION - TAO POON STATION) fees for the operation and maintenance in the Works during WITH THE MASS RAPID TRANSIT AUTHORITY OF Phase 2 (for a total period of approximately 27 years) THAILAND (MRTA) in addition to revenue from the Chaloem Ratchamongkhon The Extraordinary General Meeting of Shareholders No. Line, thereby enabling the Company to generate more 1/2012 on 29 November 2012 resolved to grant approval revenue and cash flow since such service fees also for the Company to enter into the Agreement for the MRT cover all expenses expected to be incurred and the Purple Line Project, Bang Yai - Rat Burana, Bang Yai - Bang Company’s operating margin. Therefore, the Company’s Sue Section, Contract 4: Concession for Supply of M&E results of operations will continue to improve without Systems and O&M Services (Khlong Bang Phai Station - any risks in respect of the volume of passengers of the Tao Poon Station) with the Mass Rapid Transit Authority of MRT Purple Line Project. Thailand (MRTA), following the Council of Ministers’ approval. 2. This project will help minimise the risk in respect of repayment of such investment costs to the Company. On 3 September 2013, the Council of Ministers’ Meeting The MRT Purple Line Project is on a PPP Gross Cost resolved to grant approval for MRTA to sign such Agreement basis, namely, the government sector shall invest in all for the MRT Purple Line Project, Bang Yai - Rat Burana, civil works and the private sector shall invest in the M&E Bang Yai - Bang Sue Section, Contract 4: Concession for Systems during the period of the Works during Phase Supply of M&E Systems and O&M Services (Khlong Bang 1, and thereafter, MRTA will make repayment in installments Phai Station - Tao Poon Station) with the Company, for a of all investment costs in the M&E Systems to the private concession period of 30 years, from the date of execution sector for a period of 10 years from the commencement of the Agreement. In this regard, the Company signed such date of the Operation Service, and MRTA shall be liable Agreement with MRTA on 4 September 2013. to all interest expenses and financial fees incurred from This concession is on a PPP Gross Cost basis, namely, the such investment costs, which will help minimise the risk government sector invests in all civil works and is entitled in respect of the repayment of such investment costs to all fare box revenue and commercial revenue while the to the Company. Company invests in the M&E Systems, rolling stock, including operation and maintenance, and will receive repayment in 3. The Company will secure the continuity of its business installments of the investment costs and all finance costs operations. for such M&E Systems, including service fees for the operation Currently, the Company is the concessionaire in and maintenance, from the government sector throughout operation of the MRT Blue Line Project, the Chaloem the concession period. This will help minimise the Ratchamongkhon Line, for the total distance of 20 Company’s investment risks and enable the Company to kilometres, Hua Lamphong - Bang Sue. In this regard, project the return on investment. Moreover, the route of such concession will end in 2029 and it is uncertain the MRT Purple Line Project is connecting with the MRT whether or not the Company will be granted a renewal Blue Line Project as currently operated by the Company, of the agreement by MRTA. To ensure that the Company with the interchange station at Tao Poon Station, which will will be able to continue its business operations and

Annual Report 2013 122 Bangkok Metro Public Company Limited generate revenue, the Company thus has a policy to bid position to accommodate its business expansion, in relation for concessions of other mass rapid transit rail projects. to the MRT Purple Line Project and the MRT Blue Line The fact that the Company is the concessionaire of the Extension Project which will connect with the existing MRT MRT Purple Line Project, with the term of the Concession Blue Line Project, including other extensions and new lines Agreement for 30 years from the execution date of the in the future. Concession Agreement, will ensure the continuity of the Company’s business operations for another 30 years or In 2013, the Company offered 8,550 million ordinary shares until 2043. for capital increase to the existing shareholders and by way of private placement at the price of Baht 1 per share, 4. This project will increase the volume of passengers to whereby all of the Company’s new shares were fully the MRT Blue Line Project as currently operated under subscribed, and thus the Company’s paid-up capital was the Company’s Concession Agreement. increased by Baht 8,550 million or from Baht 11,950 million The MRT Purple Line Project is a project connecting to to Baht 20,500 million. In this regard, the Company expects the MRT Blue Line Project (as currently operated under to use such proceeds as follows: the Company’s Agreement), with the interchange at Tao 1. Baht 2,000 million will be used in the additional procurement Poon Station, and the route heading towards the west of the railway systems, upgrade and improvement of of Bangkok and Nonthaburi Province and ending at the efficiency of services and operations under the Khlong Bang Phai where currently, there is no network Concession Agreement, as well as in general business of any Railway Systems available for service. Therefore, operations of the Company, and it is expected to complete the Company expects that the opening for service of the the procurement of the railway systems in 2016. MRT Purple Line Project will help materially increase the volume of passengers transiting to the MRT Blue 2. Baht 4,200 million will be used in the repayment of the Line Project as currently operated by the Company, principal and accrued interest of the loan to the shareholder, which will result in the Company’s increased fare box i.e., CH. Karnchang Public Company Limited. revenue from provision of the service of the MRT Blue Line Project. Moreover, the MRT Purple Line Project 3. Baht 2,350 million will be used in the repayment of is an extension of the service coverage from Tao Poon accrued interest of the loans and in the payment of Station to the west of Bangkok and Nonthaburi Province rescheduling fee to the financial institution creditors. and ending at Khlong Bang Phai, which will enable the Railway Systems under the Company’s operation to This capital increase will positively affect the Company’s cover more areas in Bangkok and its surrounding financial position and results of operations in the future, provinces. Passengers will then be able to travel more as follows: rapidly from the west of Bangkok and its surrounding 1. The proceeds from capital increase serve as a source provinces to other areas of Bangkok. Moreover, the of financing to strengthen the Company’s business traffic volume which is likely to increase in the west of operations. Bangkok and its surrounding provinces will attract more The proceeds of Baht 2,000 million serve as a source passengers to use the Railway Systems under the of financing for the Company’s additional procurement Company’s operation. of the railway systems to accommodate the growing number of passengers, including upgrade and improvement of the efficiency of services and operations under the 19.3.2 REGISTERED AND PAID-UP CAPITAL Concession Agreement, as well as in general business INCREASE OF BAHT 8,550 MILLION operations of the Company. Further to the continuing growth rate of the volume of 2. The capital increase helps secure and strengthen the passengers of the current MRT Blue Line Project, and the Company’s financial position. government’s plan to implement the mass rapid transit rail In the past, the Company’s results of operations showed systems in Bangkok and its surrounding provinces, including an improving sign, namely, during 2010 - 2011, the the extensions and new lines to be opened for bidding in Company sustained loss before finance cost amounting the future, the Company is then required to proceed with to Baht 196 million and Baht 57 million, respectively, and the capital increase to strengthen the Company’s financial could conversely generate profit before finance cost in

Annual Report 2013 Bangkok Metro Public Company Limited 123 2012 and 2013 in the amount of Baht 206 million and 19.3.3 UNCERTAINTY OF POLITICAL SITUATION Baht 466 million, respectively. However, the Company The announcement of the dissolution of the House of continued to sustain a net loss from its voluminous burden Representatives on 9 December 2013 for a new general of finance cost. election left a political vacuum in administration. Many large-scale projects were suspended since the caretaker This capital increase helps reduce its loan burden, both government is not in a position to approve any large-scale principal and accrued interest of the Company, from projects, until a new government is formed. The political more than Baht 16,000 million (as at 30 December 2013), uncertainty seems to take longer time to find solutions to to Baht 10,740 million, representing a massive reduction, restore Thailand’s economic mechanisms back to normal, thereby resulting in a positive effect on the Company’s and to reactivate the government mechanism to stimulate financial position. As such, liabilities and accrued interest the economy in order to regain private sector’s confidence. reduced; capital base and shareholders’ equity of the Certain investment projects of the government, particularly Company increased; and the debt to equity ratio reduced investments in infrastructure systems, including private from 57.82 times (based on the consolidated financial investments, must be suspended until the political and statements as at 30 September 2013) to 1.33 times. economic situations become certain. 3. This capital increase helps minimise current liabilities Furthermore, such political factor has caused a negative and accrued interest to be incurred in the future. impact on those businesses and industries relating to the The utilisation of proceeds of Baht 6,550 million to repay draft Act on Authorization of Ministry of Finance to Seek long-term loan and accrued interest, and to pay Loan for National Transportation Infrastructure Development rescheduling fee to CH. Karnchang Public Company (Baht 2 trillion loan bill). The mass rapid transit rail systems Limited and financial institution creditors helps minimise the as basic transport infrastructure under the government Company’s burden of repayment of outstanding principal support may also be affected by the political uncertainty. and accrued interest and interest expense burden to be Therefore, the Company’s results of operations in the future incurred in the future. Should the Company have not may not meet its projections if the train operation service yet paid such liabilities, the Company would have to pay has been delayed in the future. interest expenses to CH. Karnchang Public Company Limited in the amount of approximately Baht 250 million However, the Company remains confident that the national per year. public transport development projects are still essential and need to be implemented continuously, regardless of change 4. Shareholders’ equity and book value increase. of government, in order to develop Thailand’s basic infrastructure. As at 30 September 2013, the shareholders’ equity of The source of financing from the Baht 2 trillion loan bill may the Company amounted to Baht 239 million (excluding be reverted to a normal budget allocation. The construction non-controlling interests of the subsidiary), representing of 10 lines of the mass rapid transit rail systems, under the the book value per share of Baht 0.02 (calculated from responsibility of MRTA, will continue with its original scheme, 11,950 million shares). This capital increase resulted namely, the Ministry of Finance secures financing to MRTA in an increase in shareholders’ equity by Baht 8,550 or by way of public private participation, which will make it million. As at 31 December 2013, the shareholders’ possible to proceed according to plan. In 2014, three more equity of the Company amounted to Baht 8,683 million lines are expected to open for bidding, i.e., the MRT Green Line (excluding non-controlling interests of the subsidiary), Project, Mo Chit - Saphan Mai - Khu Kot Section, the MRT representing the book value per share of Baht 0.43 Pink Line Project, Khae Rai - Min Buri Section, and the MRT (calculated from 20,500 million shares). Therefore, such Orange Line Project, Thailand Cultural Centre - Min Buri aforesaid arrangements have caused the shareholders’ Section. equity and book value of the Company to increase accordingly.

Annual Report 2013 124 Bangkok Metro Public Company Limited 20. Report on Responsibilities of the Board of Directors towards the Financial Report

The Board of Directors is responsible for the consolidated financial statements of the Company and its Subsidiary, as well as financial information memorandum contained in the Annual Report, by ensuring that the Company’s financial report contains accurate and full accounting records, and has been prepared in compliance with the generally accepted accounting standards, proper accounting policy has been applied and regularly complied with, and due discretion in the projection has been exercised, in order to reflect the Company’s actual financial position and results of its operations. The Board of Directors established the Audit Committee comprising independent directors fully qualified in accordance with the requirements of the Office of Securities and Exchange Commission and relevant rules and regulations to supervise the Company’s internal control system for effectiveness, review and ensure accuracy and sufficiency of the financial report, including accurate and complete disclosure of related party transactions or transactions with conflict of interest, in compliance with the requirements of the Stock Exchange of Thailand and relevant rules and regulations. In this regard, the Audit Committee has already reported its performance to the Board of Directors. The Board of Directors is of the opinion that the financial statements for 2013 of the Company and its Subsidiary, which have been reviewed by the Audit Committee in conjunction with the management, and audited by the Company’s auditor, present fairly, in all material aspects, the financial position and the results of operations of the Company and its Subsidiary in accordance with generally accepted accounting principles.

(Mr. Plew Trivisvavet) (Mr. Chaiwat Utaiwan) Chairman of the Board of Directors President

Annual Report 2013 Bangkok Metro Public Company Limited 125 21 Financial Statements and Report19. Report of the and Auditor Consolidated Financial Statements Bangkok Metro Public Company Limited and its subsidiary Statement of financial position As at 31 December 2013 (Unit: Baht) Consolidated financial statements Separate financial statements ®ÓÉÊÕÊÓÉÊÓÙ¦ÚÉÎÙÔ×õØ·ÊÕÔ×Ù As at As at As at As at As at As at Note 31 December 2013 31 December 2012 1 January 2012 31 December 2013 31 December 2012 1 January 2012 Independent Auditor’s Report To the Shareholders of Bangkok Metro Public Company Limited (restated) (restated) To the Shareholders of Bangkok Metro Public Company Limited Assets I have audited the accompanying consolidated financial statements of Bangkok MetroCurrent Public assets Company Limited and its I have audited the accompanying consolidated financial statementssubsidiary, of Bangkok which Metrocomprise Public the Companyconsolidated Limited statement and its of financial position as at 31Cash December and cash equivalents 2012, and the related 7 2,194,609,246 82,964,729 104,994,036 2,185,182,363 79,565,841 100,663,015 subsidiary, which comprise the consolidated statement of financialconsolidated position statements as at 31 December of comprehensive 2013, and income, the related changes in shareholders’ equity andTrade cash and flows other for receivables the year then ended, 8 82,722,563 61,288,153 48,459,071 39,737,942 38,254,426 38,882,291 consolidated statements of comprehensive income, changes in shareholders’and a summary equity of significantand cash flows accounting for the year policies then and ended, other explanatory information, andPrepaid have expenses also audited the separate 46,002,340 50,554,710 40,381,921 45,046,673 49,837,489 39,685,978 and a summary of significant accounting policies and other explanatoryfinancial statementsinformation, of and Bangkok have also Metro audited Public the Company separate Limited for the same period. Prepaid interest of long-term loans 15 78,429,452 - - 78,429,452 - - financial statements of Bangkok Metro Public Company Limited for the same period. Other current assets 9,473,327 20,249,561 19,802,917 6,281,710 12,186,583 11,205,537 Management’s Responsibility for the Financial Statements Total current assets 2,411,236,928 215,057,153 213,637,945 2,354,678,140 179,844,339 190,436,821 Management’s Responsibility for the FinancialManagement Statements is responsible for the preparation and fair presentation of these financialNon-current statements assets in accordance with Management is responsible for the preparation and fair presentationThai Financial of these Reporting financial Standards,statements and in accordancefor such internal with control as management determinesInvestment isin subsidiarynecessary to enable the 9 - - - 149,585,600 149,585,600 149,585,600 Thai Financial Reporting Standards, and for such internal controlpreparation as management of financial determines statements is necessary that are freeto enable from material the misstatement, whether dueAdvance to fraudpayment or for error. assets 330,658,461 163,720,178 94,021,892 330,658,461 163,720,178 94,021,892 preparation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor’s Responsibility Project costs 10 17,554,959,814 17,887,711,382 18,122,268,038 17,202,027,499 17,547,176,816 17,772,067,812 Equipment 11 18,946,805 14,191,468 15,349,683 16,117,570 13,122,478 14,316,931 Auditor’s Responsibility My responsibility is to express an opinion on these financial statements based on Computermy audit. software I conducted my audit in 12 1,183,885 1,467,641 2,177,281 1,001,289 1,467,638 2,177,278 My responsibility is to express an opinion on these financial statementsaccordance based with Thai on Standardsmy audit. onI conducted Auditing. Thosemy audit standards in require that I comply withGoodwill ethical requirements and plan and 6,033,738 6,033,738 6,033,738 - - - accordance with Thai Standards on Auditing. Those standards requireperform that the I complyaudit to obtainwith ethical reasonable requirements assurance and about plan andwhether the financial statements areDeferred free tax from assets material misstatement. 12,060,698 14,297,955 12,542,972 10,120,559 5,485,337 2,807,340 perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amountsOther and non-current disclosures assets in the financial 23,823,082 15,840,960 13,579,786 188,582 196,582 3,401,068 Total non-current assets 17,947,666,483 18,103,263,322 18,265,973,390 17,709,699,560 17,880,754,629 18,038,377,921 An audit involves performing procedures to obtain audit evidencestatements. about the The amounts procedures and selected disclosures depend in the on thefinancial auditor’s judgment, including the Totalassessment assets of the risks of material 20,358,903,411 18,318,320,475 18,479,611,335 20,064,377,700 18,060,598,968 18,228,814,742 statements. The procedures selected depend on the auditor’s judgment,misstatement including of the the financial assessment statements, of the risks whether of material due to fraud or error. In making those risk assessments, the auditor misstatement of the financial statements, whether due to fraudconsiders or error. internalIn making control those relevant risk assessments, to the entity’s the preparation auditor and fair presentation of the financial statements in order to considers internal control relevant to the entity’s preparation anddesign fair presentation audit procedures of the that financial are appropriate statements in inthe order circumstances, to but not for the purpose of expressing an opinion on the design audit procedures that are appropriate in the circumstances,effectiveness but not for theof the purpose entity’s of internalexpressing control. an opinion An audit on also the includes evaluating the appropriateness of accounting policies effectiveness of the entity’s internal control. An audit also includesused evaluating and the reasonableness the appropriateness of accounting of accounting estimates policies made by management, as well as evaluating the overall presentation used and the reasonableness of accounting estimates made by management,of the financial as statements. well as evaluating the overall presentation of the financial statements. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion. Opinion Opinion In my opinion, the financial statements referred to above present fairly, in all material respects, the financial position In my opinion, the financial statements referred to above presentof Bangkok fairly, in Metro all material Public respects,Company the Limited financial and position its subsidiary and of Bangkok Metro Public Company Limited as at of Bangkok Metro Public Company Limited and its subsidiary and31 December of Bangkok 2012, Metro and Public their Company financial performanceLimited as at and31 cash flows for the year then ended, in accordance with Thai December 2013, and their financial performance and cash flows Financialfor the year Reporting then ended, Standards. in accordance with Thai Financial Reporting Standards.

Supachai Supachai PhanyawattanoPhanyawattano Certified PublicCertified Accountant Public Accountant (Thailand) (Thailand) No. 3930 No. 3930 ErnstErnst & & Young Young Office Office Limited Limited Bangkok:Bangkok: 1925 FebruaryFebruary 20132014

Annual Report 2013 126 Bangkok Metro Public Company Limited 108 Bangkok Metro Public Company Limited Bangkok Metro Public Company Limited and its subsidiary

Bangkok MetroStatement Public Company Limited and of its subsidiary financial position Statement ofAs financial at 31 position December 2013 As at 31 December 2013 (Unit: Baht) Consolidated financial statements Separate financial statements As at As at As at As at As at As at Note 31 December 2013 31 December 2012 1 January 2012 31 December 2013 31 December 2012 1 January 2012 (restated) (restated) Assets Current assets Cash and cash equivalents 7 2,194,609,246 82,964,729 104,994,036 2,185,182,363 79,565,841 100,663,015 Trade and other receivables 8 82,722,563 61,288,153 48,459,071 39,737,942 38,254,426 38,882,291 Prepaid expenses 46,002,340 50,554,710 40,381,921 45,046,673 49,837,489 39,685,978 Prepaid interest of long-term loans 15 78,429,452 - - 78,429,452 - - Other current assets 9,473,327 20,249,561 19,802,917 6,281,710 12,186,583 11,205,537 Total current assets 2,411,236,928 215,057,153 213,637,945 2,354,678,140 179,844,339 190,436,821 Non-current assets Investment in subsidiary 9 - - - 149,585,600 149,585,600 149,585,600 Advance payment for assets 330,658,461 163,720,178 94,021,892 330,658,461 163,720,178 94,021,892 Project costs 10 17,554,959,814 17,887,711,382 18,122,268,038 17,202,027,499 17,547,176,816 17,772,067,812 Equipment 11 18,946,805 14,191,468 15,349,683 16,117,570 13,122,478 14,316,931 Computer software 12 1,183,885 1,467,641 2,177,281 1,001,289 1,467,638 2,177,278 Goodwill 6,033,738 6,033,738 6,033,738 - - - Deferred tax assets 12,060,698 14,297,955 12,542,972 10,120,559 5,485,337 2,807,340 Other non-current assets 23,823,082 15,840,960 13,579,786 188,582 196,582 3,401,068 Total non-current assets 17,947,666,483 18,103,263,322 18,265,973,390 17,709,699,560 17,880,754,629 18,038,377,921 Total assets 20,358,903,411 18,318,320,475 18,479,611,335 20,064,377,700 18,060,598,968 18,228,814,742

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

Annual Report 2013 Bangkok Metro Public Company Limited 127 Bangkok Metro Public Company Limited and its subsidiary

BangkokStatement Metro Public Company Limited of and itsfinancial subsidiary position (continued) StatementAs ofat financial 31 December position (continued) 2013 As at 31 December 2013 (Unit: Baht) Consolidated financial statements Separate financial statements As at As at As at As at As at As at Note 31 December 2013 31 December 2012 1 January 2012 31 December 2013 31 December 2012 1 January 2012 (restated) (restated) Liabilities and shareholders' equity Current liabilities Bank overdraft 13 - 6,036,777 5,288,815 - - - Construction payables and other payables 14 525,125,729 540,436,327 474,860,113 494,674,812 515,666,359 459,941,518 Unearned fare box revenue 77,466,533 67,441,066 82,995,492 77,466,533 67,441,066 82,995,492 Deposits on stored value ticket 32,360,581 30,238,189 48,970,042 32,360,581 30,238,189 48,970,042 Current portion of long-term loans from financial institutions and accrued interest 15 33,162,104 10,076,329 8,542,904 - - - Other current liabilities 39,308,941 19,803,250 21,570,207 21,265,576 8,111,942 11,826,803 Total current liabilities 707,423,888 674,031,938 642,227,573 625,767,502 621,457,556 603,733,855 Non-current liabilities Construction payable to related party 6 60,185,781 130,185,781 130,185,781 - - - Long-term loans from financial institutions and accrued interest - net of current portion 15 10,739,500,000 12,244,866,841 11,842,930,668 10,602,500,000 12,155,366,841 11,743,430,668 Long-term loans from shareholder and accrued interest 6 - 3,980,987,602 3,709,046,475 - 3,980,987,602 3,709,046,475 Provision for long-term employee benefits 18 54,712,723 30,757,447 15,763,321 50,602,797 27,426,687 14,036,702 Deferred leasehold right revenue 6,802,684 6,802,684 7,035,479 - - - Guarantee on rental and service and advertising management agreements 29,785,875 29,704,715 35,702,935 - - - Unearned revenue from advertising management rights 6, 16 - - - 18,375,000 21,000,000 28,000,000 Other non-current liabilities 4,421,733 249,996,229 146,974,845 3,783,421 249,996,229 146,974,845 Total non-current liabilities 10,895,408,796 16,673,301,299 15,887,639,504 10,675,261,218 16,434,777,359 15,641,488,690 Total liabilities 11,602,832,684 17,347,333,237 16,529,867,077 11,301,028,720 17,056,234,915 16,245,222,545

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

Annual Report 2013 128 Bangkok Metro Public Company Limited Bangkok Metro Public Company Limited and its subsidiary

Bangkok MetroStatement Public Company Limited and ofits subsidiary financial position (continued) Statement ofAs financial at 31 position December (continued) 2013 As at 31 December 2013 (Unit: Baht) Consolidated financial statements Separate financial statements As at As at As at As at As at As at Note 31 December 2013 31 December 2012 1 January 2012 31 December 2013 31 December 2012 1 January 2012 (restated) (restated) Shareholders' equity Share capital Registered 20,500,000,000 ordinary shares (2012: 11,950,000,000 ordinary shares) of Baht 1 each 20,500,000,000 11,950,000,000 11,950,000,000 20,500,000,000 11,950,000,000 11,950,000,000 Issued and fully paid-up 20,500,000,000 ordinary shares (2012: 11,950,000,000 ordinary shares) of Baht 1 each 19 20,500,000,000 11,950,000,000 11,950,000,000 20,500,000,000 11,950,000,000 11,950,000,000 Share premium 968,445,115 968,445,115 968,445,115 968,445,115 968,445,115 968,445,115 Deficit (12,785,776,781) (12,011,775,361) (11,032,854,342) (12,705,096,135) (11,914,081,062) (10,934,852,918) Equity attributable to owners of the Company 8,682,668,334 906,669,754 1,885,590,773 8,763,348,980 1,004,364,053 1,983,592,197 Non-controlling interests of the subsidiary 73,402,393 64,317,484 64,153,485 - - - Total shareholders' equity 8,756,070,727 970,987,238 1,949,744,258 8,763,348,980 1,004,364,053 1,983,592,197 Total liabilities and shareholders' equity 20,358,903,411 18,318,320,475 18,479,611,335 20,064,377,700 18,060,598,968 18,228,814,742

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

Annual Report 2013 Bangkok Metro Public Company Limited 129 Bangkok Metro Public Company Limited and its subsidiary Statement of comprehensive income Bangkok Metro Public Company Limited and its subsidiary Bangkok Metro Public Company Limited and its subsidiary Statement of comprehensive income For the year ended 31 December 2013 Statement of comprehensive income (continued) For the year ended 31 December 2013 For the year ended 31 December 2013 (Unit: Baht) (Unit: Baht) Consolidated financial statements Separate financial statements Consolidated financial statements Separate financial statements Note 2013 2012 2013 2012 2013 2012 2013 2012 (restated) (restated) Revenue (restated) (restated) Fare box revenue 2,106,357,488 1,979,347,901 2,106,357,488 1,979,347,901 Profit (loss) attributable to: Commercial development revenue 421,763,920 290,773,706 226,705,442 163,996,911 Equity holders of the Company (774,001,420) (978,921,019) (791,015,073) (979,228,144) Other income 8,878,744 10,619,213 7,599,799 8,548,360 Non-controlling interests of the subsidiary 9,084,909 163,999 Total revenues 2,537,000,152 2,280,740,820 2,340,662,729 2,151,893,172 (764,916,511) (978,757,020) Expenses Costs of fare box 1,316,008,055 1,369,060,114 1,316,008,055 1,369,060,114 Basic loss per share 23 Costs of commercial development 150,117,211 116,461,814 80,976,099 79,577,020 Loss attributable to equity holders of the Company (0.06) (0.08) (0.06) (0.08) Amortisation of project costs 365,401,810 341,956,013 348,099,116 323,684,346 Selling expenses 38,105,501 30,065,055 12,005,743 11,506,435 Administrative expenses 201,528,099 217,503,559 169,443,163 182,222,441 Total expenses 2,071,160,676 2,075,046,555 1,926,532,176 1,966,050,356 Profit before finance cost and income tax expense 465,839,476 205,694,265 414,130,553 185,842,816 Finance cost (1,228,518,730) (1,186,206,268) (1,209,780,848) (1,167,748,957) Loss before income tax expense (762,679,254) (980,512,003) (795,650,295) (981,906,141) Income tax expense 21 (2,237,257) 1,754,983 4,635,222 2,677,997 Loss for the year (764,916,511) (978,757,020) (791,015,073) (979,228,144)

Other comprehensive income: Other comprehensive income for the year - - - -

Total comprehensive loss for the year (764,916,511) (978,757,020) (791,015,073) (979,228,144)

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

Annual Report 2013 130 Bangkok Metro Public Company Limited Bangkok Metro Public Company Limited and its subsidiary Statement of comprehensive income (continued) Bangkok Metro Public Company Limited and its subsidiary ForStatement the year of comprehensive ended 31 December income (continued) 2013 For the year ended 31 December 2013 (Unit: Baht) Consolidated financial statements Separate financial statements 2013 2012 2013 2012 (restated) (restated) Profit (loss) attributable to: Equity holders of the Company (774,001,420) (978,921,019) (791,015,073) (979,228,144) Non-controlling interests of the subsidiary 9,084,909 163,999 (764,916,511) (978,757,020)

Basic loss per share 23 Loss attributable to equity holders of the Company (0.06) (0.08) (0.06) (0.08)

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

Annual Report 2013 Bangkok Metro Public Company Limited 131 Bangkok Metro Public Company Limited and its subsidiary Statement of changes in shareholders’ equity BangkokFor Metro the Public year Company ended Limited31 December and its subsidiary 2013 Bangkok Metro Public Company Limited and its subsidiary Statement of changes in shareholders' equity Statement of changes in shareholders' equity (continued) For the year ended 31 December 2013 For the year ended 31 December 2013 (Unit: Baht) (Unit: Baht) Consolidated financial statements Separate financial statements Equity attributable to owners of the Company Issued and Total equity Equity attributable fully paid-up Share Issued and attributable to to non-controlling share capital premium Deficit Total fully paid-up Share owners of interests of Balance as at 31 December 2011 - as previouly reported 11,950,000,000 968,445,115 (10,937,660,258) 1,980,784,857 share capital premium Deficit the Company the subsidiary Total Cumulative effect of change in accounting policy Balance as at 31 December 2011 - as previouly reported 11,950,000,000 968,445,115 (11,042,008,341) 1,876,436,774 60,764,512 1,937,201,286 for income taxes (Note 3) - - 2,807,340 2,807,340 Cumulative effect of change in accounting policy Balance as at 31 December 2011 - as restated 11,950,000,000 968,445,115 (10,934,852,918) 1,983,592,197 for income taxes (Note 3) - - 9,153,999 9,153,999 3,388,973 12,542,972 Total comprehensive loss for the year (restated) - - (979,228,144) (979,228,144) Balance as at 31 December 2011 - as restated 11,950,000,000 968,445,115 (11,032,854,342) 1,885,590,773 64,153,485 1,949,744,258 Balance as at 31 December 2012 - as restated 11,950,000,000 968,445,115 (11,914,081,062) 1,004,364,053 Total comprehensive income (loss) for the year (restated) - - (978,921,019) (978,921,019) 163,999 (978,757,020) - Balance as at 31 December 2012 - as restated 11,950,000,000 968,445,115 (12,011,775,361) 906,669,754 64,317,484 970,987,238 Balance as at 31 December 2012 - as previouly reported 11,950,000,000 968,445,115 (11,919,566,399) 998,878,716 - Cumulative effect of change in accounting policy Balance as at 31 December 2012 - as previouly reported 11,950,000,000 968,445,115 (12,023,005,644) 895,439,471 61,249,812 956,689,283 for income taxes (Note 3) - - 5,485,337 5,485,337 Cumulative effect of change in accounting policy Balance as at 31 December 2012 - as restated 11,950,000,000 968,445,115 (11,914,081,062) 1,004,364,053 for income taxes (Note 3) - - 11,230,283 11,230,283 3,067,672 14,297,955 Increase share capital (Note 19) 8,550,000,000 - - 8,550,000,000 Balance as at 31 December 2012 - as restated 11,950,000,000 968,445,115 (12,011,775,361) 906,669,754 64,317,484 970,987,238 Total comprehensive loss for the year - - (791,015,073) (791,015,073) Increase share capital (Note 19) 8,550,000,000 - - 8,550,000,000 - 8,550,000,000 Balance as at 31 December 2013 20,500,000,000 968,445,115 (12,705,096,135) 8,763,348,980 Total comprehensive income (loss) for the year - - (774,001,420) (774,001,420) 9,084,909 (764,916,511) Balance as at 31 December 2013 20,500,000,000 968,445,115 (12,785,776,781) 8,682,668,334 73,402,393 8,756,070,727

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

Annual Report 2013 132 Bangkok Metro Public Company Limited Bangkok Metro Public Company Limited and its subsidiary Statement of changes in shareholders’ equity (continued) BangkokFor Metro the Public year Company ended Limited 31 December and its subsidiary 2013 Statement of changes in shareholders' equity (continued) For the year ended 31 December 2013 (Unit: Baht) Separate financial statements Issued and fully paid-up Share share capital premium Deficit Total Balance as at 31 December 2011 - as previouly reported 11,950,000,000 968,445,115 (10,937,660,258) 1,980,784,857 Cumulative effect of change in accounting policy for income taxes (Note 3) - - 2,807,340 2,807,340 Balance as at 31 December 2011 - as restated 11,950,000,000 968,445,115 (10,934,852,918) 1,983,592,197 Total comprehensive loss for the year (restated) - - (979,228,144) (979,228,144) Balance as at 31 December 2012 - as restated 11,950,000,000 968,445,115 (11,914,081,062) 1,004,364,053 - Balance as at 31 December 2012 - as previouly reported 11,950,000,000 968,445,115 (11,919,566,399) 998,878,716 Cumulative effect of change in accounting policy for income taxes (Note 3) - - 5,485,337 5,485,337 Balance as at 31 December 2012 - as restated 11,950,000,000 968,445,115 (11,914,081,062) 1,004,364,053 Increase share capital (Note 19) 8,550,000,000 - - 8,550,000,000 Total comprehensive loss for the year - - (791,015,073) (791,015,073) Balance as at 31 December 2013 20,500,000,000 968,445,115 (12,705,096,135) 8,763,348,980

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

Annual Report 2013 Bangkok Metro Public Company Limited 133 Bangkok Metro Public Company Limited and its subsidiary

CashBangkok Metroflow Public Company statement Limited and its subsidiary For theCash year flow statementended 31 December 2013 For the year ended 31 December 2013 (Unit: Baht) Consolidated financial statements Separate financial statements 2013 2012 2013 2012 (restated) (restated) Cash flows from operating activities Loss before tax (762,679,254) (980,512,003) (795,650,295) (981,906,141) Adjustments to reconcile loss to net cash provided by (paid from) operating activities:- Depreciation and amortisation 6,077,495 5,970,239 5,268,432 5,299,132 Allowance for doubtful debts 54,879 3,721,759 - - Revenue from unearned revenue from advertising management rights - - (7,000,000) (7,000,000) Amortisation on project costs 365,401,810 341,956,013 348,099,116 323,684,346 Amortisation of prepaid expenses 128,818,615 121,432,946 121,278,740 115,261,709 Withholding tax deducted at source written off 7,166,627 4,962,615 7,166,481 4,962,207 Loss (gain) on disposal/write off of equipment and project costs (644,394) (732,110) 28,178 (732,110) Provision for long-term employee benefits 27,058,017 15,014,126 26,278,850 13,409,985 Unrealised loss on exchange 10,891,674 1,756,869 10,891,674 1,756,869 Interest expenses 1,036,287,393 1,063,788,177 1,018,249,664 1,045,651,141 Profit from operating activities before changes in operating assets and liabilities 818,432,862 577,358,631 734,610,840 520,387,138 Operating assets (increase) decrease Trade and other receivables (21,489,289) (16,550,841) (1,483,516) 627,865 Prepaid expenses (124,266,245) (131,605,735) (116,487,924) (125,413,220) Other current assets (2,352,391) 612,308 (1,694,488) 208,319 Advance payment for assets (159,338,921) (70,887,651) (159,338,921) (70,887,651) Other non-current assets 526,546 3,105 7,999 (4,500) Operating liabilities increase (decrease) Construction payables and other payables (16,141,267) 26,526,993 (27,508,221) 23,607,764 Unearned fare box revenue 10,025,467 (15,554,426) 10,025,467 (15,554,426) Deposits on stored value ticket 2,122,392 (18,731,853) 2,122,392 (18,731,853) Other current liabilities 19,505,691 (1,766,957) 13,153,634 (3,714,861) Other non-current liabilities (255,575,434) 96,770,369 (255,200,655) 103,001,384 Cash flows from operating activities 271,449,411 446,173,943 198,206,607 413,525,959 Cash paid for interest expenses (3,658,546,518) (414,140,676) (3,630,533,559) (398,683,048) Cash paid for withholding tax deducted at source (10,167,264) (10,581,404) (7,166,481) (4,962,207) Net cash flows from (used in) operating activities (3,397,264,371) 21,451,863 (3,439,493,433) 9,880,704

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

Annual Report 2013 134 Bangkok Metro Public Company Limited Bangkok Metro Public Company Limited and its subsidiary Cash flow statement (continued) Bangkok Metro Public Company Limited and its subsidiary For the year ended 31 December 2013 Cash flow statement (continued)

For the year ended 31 December 2013

(Unit: Baht)

Consolidated financial statements Separate financial statements

2013 2012 2013 2012

(restated) (restated)

Cash flows from investing activities Acquisition of equipment (3,238,145) (4,111,091) (1,780,492) (3,403,746)

Increase in computer software (329,754) - (159,754) -

Proceed from sale of equipment and project costs 675,701 771,907 - 771,907

Increase in advance payment for assets (60,000) (111,232) - -

Increase in project costs (32,602,137) (69,187,923) (2,949,799) (65,255,246)

Net cash flows used in investing activities (35,554,335) (72,638,339) (4,890,045) (67,887,085)

Cash flows from financing activities

Increase (decrease) in bank overdraft (6,036,777) 747,962 - - Repayment of construction payable to related party (70,000,000)-70,000,000 - - - Repayment of long-term loans (20,500,000) (8,500,000) - - Cash reciptreceipt from from long-term long-term loans loans 91,000,000 - - - Repayment of loan-term loans from shareholder (3,000,000,000) - (3,000,000,000) -

Cash receipt from long-term loans from shareholder - 36,909,207 - 36,909,207

Proceeds from increase in share capital 8,550,000,000 - 8,550,000,000 -

Net cash flows from financing activities 5,544,463,223 29,157,169 5,550,000,000 36,909,207

Net increase (decrease) in cash and cash equivalents 2,111,644,517 (22,029,307) 2,105,616,522 (21,097,174)

Cash and cash equivalents at beginning of year 82,964,729 104,994,036 79,565,841 100,663,015

Cash and cash equivalents at end of year 2,194,609,246 82,964,729 2,185,182,363 79,565,841

- - - -

Supplemental cash flow information:

Non-cash transactions

Transfer advance payment for assets to project cost and

computer software 81,232 3,596,155 - 3,208,986

Purchase of project costs for which no cash has been paid - 34,646,369 - 30,360,208

Purchase of equipment under finance lease agreement 6,979,357 - 5,885,107 -

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

Annual Report 2013 Bangkok Metro Public Company Limited 135 Bangkok Metro Public Company Limited and its subsidiary Phase I Design and Build Notes to consolidated financial statements The Company is responsible for the implementation of the design, supply, installation and testing of the For the year ended 31 December 2013 M&E Systems within 1,200 days after the Agreement date. On the specific date in the Commissioning Certificate, the Company is to transfer the M&E Systems to MRTA and the MRTA will transfer the rights of the civil infrastructure and M&E Systems back to the Company for use in Phase II of the agreement. 1. General information The agreement value of this phase amounts to Baht 20,011 million. The Company will receive this compensation from the MRTA on a monthly basis over a period of 10 years, beginning from the date of Corporate information the Commissioning Certificate. Bangkok Metro Public Company Limited (“the Company”) is a public company incorporated and domiciled in Thailand. Its major shareholders are Mass Rapid Transit Authority of Thailand (“MRTA”) and CH. Karnchang Subsequently, the Company subcontracted all works under its responsibility to a related company. The group of companies, which were incorporated in Thailand. The Company is principally engaged in the operation agreement value is amounting to Baht 20,011 million. The related party will invoice the Company for the of the MRTA Initial System Project - Chaloem Ratchamongkhon Line (“the Project”) and commercial total cost of the construction work on the date specified in the Commissioning Certificate and earn a development. The registered office of the Company is at 189 Rama IX Road, Huai Khwang, Bangkok. monthly compensation depending on the Company’s receiving compensation from MRTA. However, the Company entered into an agreement to assign the proceeds under the agreement made with the MRTA a) On 1 August 2000, the Company entered into “Agreement for the MRTA Initial System Project - Chaloem to the related company’s bank, as collateral. Ratchamongkhon Line” (“the Concession Agreement”) with the MRTA to design, manufacture, supply, install, test and commission the M&E Equipment, and for the operation and maintenance of the MRTA Phase II O&M services Initial System. The Agreement is for 25 years from the date that MRTA issues a Notice of No Objection The Company has a responsibility to operate services, including repair, maintenance and improvement of to Commencement of Revenue Service. The MRTA Initial System officially commenced operation on 3 all equipment relating to civil infrastructure and M&E Systems, from the date specified in the July 2004. Commissioning Certificate to the end of Concession Agreement. In addition, the Company shall transfer back the right of civil infrastructure and M&E Systems to MRTA when the Concession Agreement ends. Under the Agreement, the Company agrees to apportion revenue to the MRTA, which consist of The consideration stipulated in this Phase amounts to Baht 57,208 million (excluding escalation in remuneration from fares, remuneration from commercial development, apportionment of profit calculated accordance with the general consumer price index and electricity price rate adjustment) and is paid on a from the Return on Equity (ROE) and any benefit derived from the interest rate on a credit agreement monthly basis, from the date specified in the Commissioning Certificate to the end of Concession being lower than a specified rate in the Concession Agreement. Agreement.

b) On 19 December 2001, the Company entered into a long-term loan agreement with a group of domestic lenders, comprising of 4 commercial banks (Onshore Facilities Agreement). The loan agreement, which 2. Basis of preparation was amended 6 times of supplemental agreements from 27 January 2003 to 29 March 2013, provides 5 credit facilities, named Tranche A to Tranche E. After the Company fully paid Tranche D and Tranche E in 2.1 The financial statements have been prepared in accordance with Thai Financial Reporting Standards enunciated 2006, the Company had the following remaining credit facilities: under the Accounting Professions Act B.E. 2547 and their presentation has been made in compliance with the stipulations of the Notification of the Department of Business Development dated 28 September 2011, issued 1) Tranche A: A long-term loan facility of Baht 11,000 million for the payment of project costs. under the Accounting Act B.E. 2543. 2) Tranche B: A performance guarantee facility of Baht 150 million provided to guarantee the Company’s obligations to the MRTA under the concession agreement of the MRTA Initial System The financial statements in Thai language are the official statutory financial statements of the Company. The Project - Chaloem Ratchamongkhon Line. financial statements in English language have been translated from the Thai language financial statements. 3) Tranche C: A performance guarantee facility of Baht 60 million provided to guarantee the Company’s obligations to the relevant authorities in relation to the Project. The financial statements have been prepared on a historical cost basis except where otherwise disclosed in the accounting policies. c) On 3 September 2013, the Cabinet resolution granted approval for the MRTA to sign the Agreement for the MRT Purple Line Project, Bang Yai - Rat Burana, Bang Yai - Bang Sue Section (Khlong Bang Phai 2.2 Basis of consolidation Station - Tao Poon Station) (“the MRT Purple Line Project”) with the Company. The Company signed the a) The consolidated financial statements include the financial statements of Bangkok Metro Public Company Agreement on 4 September 2013. The Agreement is a concession for the supply of M&E Systems and Limited (“the Company”) and its subsidiary company, Bangkok Metro Networks Limited (“the subsidiary”). O&M Services for a period of 30 years, from the date of the Agreement. Operations under the Agreement The subsidiary domiciled in Thailand, which is principally engaged in rental of retail space and provision of are separated into 2 phases as follows:

Annual Report 2013 136 Bangkok Metro Public Company Limited Bangkok Metro Public Company Limited and its subsidiary Phase I Design and Build Notes to consolidated financial statements The Company is responsible for the implementation of the design, supply, installation and testing of the For the year ended 31 December 2013 M&E Systems within 1,200 days after the Agreement date. On the specific date in the Commissioning Certificate, the Company is to transfer the M&E Systems to MRTA and the MRTA will transfer the rights of the civil infrastructure and M&E Systems back to the Company for use in Phase II of the agreement. 1. General information The agreement value of this phase amounts to Baht 20,011 million. The Company will receive this compensation from the MRTA on a monthly basis over a period of 10 years, beginning from the date of Corporate information the Commissioning Certificate. Bangkok Metro Public Company Limited (“the Company”) is a public company incorporated and domiciled in Thailand. Its major shareholders are Mass Rapid Transit Authority of Thailand (“MRTA”) and CH. Karnchang Subsequently, the Company subcontracted all works under its responsibility to a related company. The group of companies, which were incorporated in Thailand. The Company is principally engaged in the operation agreement value is amounting to Baht 20,011 million. The related party will invoice the Company for the of the MRTA Initial System Project - Chaloem Ratchamongkhon Line (“the Project”) and commercial total cost of the construction work on the date specified in the Commissioning Certificate and earn a development. The registered office of the Company is at 189 Rama IX Road, Huai Khwang, Bangkok. monthly compensation depending on the Company’s receiving compensation from MRTA. However, the Company entered into an agreement to assign the proceeds under the agreement made with the MRTA a) On 1 August 2000, the Company entered into “Agreement for the MRTA Initial System Project - Chaloem to the related company’s bank, as collateral. Ratchamongkhon Line” (“the Concession Agreement”) with the MRTA to design, manufacture, supply, install, test and commission the M&E Equipment, and for the operation and maintenance of the MRTA Phase II O&M services Initial System. The Agreement is for 25 years from the date that MRTA issues a Notice of No Objection The Company has a responsibility to operate services, including repair, maintenance and improvement of to Commencement of Revenue Service. The MRTA Initial System officially commenced operation on 3 all equipment relating to civil infrastructure and M&E Systems, from the date specified in the July 2004. Commissioning Certificate to the end of Concession Agreement. In addition, the Company shall transfer back the right of civil infrastructure and M&E Systems to MRTA when the Concession Agreement ends. Under the Agreement, the Company agrees to apportion revenue to the MRTA, which consist of The consideration stipulated in this Phase amounts to Baht 57,208 million (excluding escalation in remuneration from fares, remuneration from commercial development, apportionment of profit calculated accordance with the general consumer price index and electricity price rate adjustment) and is paid on a from the Return on Equity (ROE) and any benefit derived from the interest rate on a credit agreement monthly basis, from the date specified in the Commissioning Certificate to the end of Concession being lower than a specified rate in the Concession Agreement. Agreement. b) On 19 December 2001, the Company entered into a long-term loan agreement with a group of domestic lenders, comprising of 4 commercial banks (Onshore Facilities Agreement). The loan agreement, which 2. Basis of preparation was amended 6 times of supplemental agreements from 27 January 2003 to 29 March 2013, provides 5 credit facilities, named Tranche A to Tranche E. After the Company fully paid Tranche D and Tranche E in 2.1 The financial statements have been prepared in accordance with Thai Financial Reporting Standards enunciated 2006, the Company had the following remaining credit facilities: under the Accounting Professions Act B.E. 2547 and their presentation has been made in compliance with the stipulations of the Notification of the Department of Business Development dated 28 September 2011, issued 1) Tranche A: A long-term loan facility of Baht 11,000 million for the payment of project costs. under the Accounting Act B.E. 2543. 2) Tranche B: A performance guarantee facility of Baht 150 million provided to guarantee the Company’s obligations to the MRTA under the concession agreement of the MRTA Initial System The financial statements in Thai language are the official statutory financial statements of the Company. The Project - Chaloem Ratchamongkhon Line. financial statements in English language have been translated from the Thai language financial statements. 3) Tranche C: A performance guarantee facility of Baht 60 million provided to guarantee the Company’s obligations to the relevant authorities in relation to the Project. The financial statements have been prepared on a historical cost basis except where otherwise disclosed in the accounting policies. c) On 3 September 2013, the Cabinet resolution granted approval for the MRTA to sign the Agreement for the MRT Purple Line Project, Bang Yai - Rat Burana, Bang Yai - Bang Sue Section (Khlong Bang Phai 2.2 Basis of consolidation Station - Tao Poon Station) (“the MRT Purple Line Project”) with the Company. The Company signed the a) The consolidated financial statements include the financial statements of Bangkok Metro Public Company Agreement on 4 September 2013. The Agreement is a concession for the supply of M&E Systems and Limited (“the Company”) and its subsidiary company, Bangkok Metro Networks Limited (“the subsidiary”). O&M Services for a period of 30 years, from the date of the Agreement. Operations under the Agreement The subsidiary domiciled in Thailand, which is principally engaged in rental of retail space and provision of are separated into 2 phases as follows:

Annual Report 2013 Bangkok Metro Public Company Limited 137 advertising services and telecommunication services in underground train stations. The Company’s interest in the tax assets or liabilities subjecting to certain recognition criteria. The Company and its subsidiary changed this equity of the subsidiary is 65.2%. accounting policy in this year and restated the prior year’s financial statements, presented as comparative b) Subsidiary is fully consolidated, being the date on which the Company obtains control, and continue to be information, as though the Company and its subsidiary had initially recognised the tax effects as deferred tax consolidated until the date when such control ceases. assets or liabilities. The change has the effect of increasing the loss of the Company and its subsidiary for the c) The financial statements of the subsidiary are prepared using the same significant accounting policies as year ended 31 December 2013 by Baht 2.2 million, with insignificant to the loss per share (For the year ended the Company. 31 December 2012: decreasing the loss by Baht 1.8 million, with insignificant to the loss per share) (Separate d) Material balances and transactions between the Company and its subsidiary company have been financial statements: for the year ended 31 December 2013, decreasing the loss by Baht 4.6 million, with eliminated from the consolidated financial statements. insignificant to the loss per share (For the year ended 31 December 2012: decreasing the loss by Baht 2.7 e) Non-controlling interests represent the portion of profit or loss and net assets of the subsidiary that are million, with insignificant to the loss per share)). The cumulative effect of the changes in the accounting policy not held by the Company and are presented separately in the consolidated profit or loss and within equity has been presented in “Cumulative effect of change in accounting policy for Income Taxes” on the statements in the consolidated statements of financial position. of changes in shareholders’ equity.

2.3 The separate financial statements, which present investment in subsidiary under the cost method, have been (b) Accounting standards that will become effective in the future prepared solely for the benefit of the public. Effective date Accounting Standards: TAS 1 (revised 2012) Presentation of Financial Statements 1 January 2014 3. New accounting standards TAS 7 (revised 2012) Statement of Cash Flows 1 January 2014 TAS 12 (revised 2012) Income Taxes 1 January 2014 Below is a summary of accounting standards that became effective in the current accounting year and those TAS 17 (revised 2012) Leases 1 January 2014 that will become effective in the future. TAS 18 (revised 2012) Revenue 1 January 2014 TAS 19 (revised 2012) Employee Benefits 1 January 2014 (a) Accounting standards that became effective in the current accounting year TAS 21 (revised 2012) The Effects of Changes in Foreign Exchange Rates 1 January 2014 Accounting standards: TAS 24 (revised 2012) Related Party Disclosures 1 January 2014 TAS 12 Income Taxes TAS 28 (revised 2012) Investments in Associates 1 January 2014 TAS 20 (revised 2009) Accounting for Government Grants and Disclosure of Government TAS 31 (revised 2012) Interests in Joint Ventures 1 January 2014 Assistance TAS 34 (revised 2012) Interim Financial Reporting 1 January 2014 TAS 21 (revised 2009) The Effects of Changes in Foreign Exchange Rates TAS 36 (revised 2012) Impairment of Assets 1 January 2014 TAS 38 (revised 2012) Intangible Assets 1 January 2014 Financial Reporting Standard: Financial Reporting Standards: TFRS 8 Operating Segments TFRS 2 (revised 2012) Share-based Payment 1 January 2014 TFRS 3 (revised 2012) Business Combinations 1 January 2014 Accounting Standard Interpretations: TFRS 4 Insurance Contracts 1 January 2016 TSIC 10 Government Assistance - No Specific Relation to Operating Activities TFRS 5 (revised 2012) Non-current Assets Held for Sale and 1 January 2014 TSIC 21 Income Taxes - Recovery of Revalued Non-Depreciable Assets Discontinued Operations TSIC 25 Income Taxes - Changes in the Tax Status of an Entity or its TFRS 8 (revised 2012) Operating Segments 1 January 2014 Shareholders Accounting Standard Interpretations: Accounting Treatment Guidance for Transfers of Financial Assets TSIC 15 Operating Leases - Incentives 1 January 2014 TSIC 27 Evaluating the Substance of Transactions Involving 1 January 2014 These accounting standards, financial reporting standard, accounting standard interpretations and accounting the Legal Form of a Lease treatment guidance do not have any significant impact on the financial statements, except for the following TSIC 29 Service Concession Arrangements: Disclosures 1 January 2014 accounting standard. TSIC 32 Intangible Assets - Web Site Costs 1 January 2014 Financial Reporting Standard Interpretations: TAS 12 Income Taxes TFRIC 1 Changes in Existing Decommissioning, Restoration 1 January 2014 This accounting standard requires an entity to identify temporary differences between the carrying amount of an and Similar Liabilities asset or liability in the statement of financial position and its tax base and recognise the tax effects as deferred TFRIC 4 Determining whether an Arrangement contains a 1 January 2014

Annual Report 2013 138 Bangkok Metro Public Company Limited tax assets or liabilities subjecting to certain recognition criteria. The Company and its subsidiary changed this accounting policy in this year and restated the prior year’s financial statements, presented as comparative information, as though the Company and its subsidiary had initially recognised the tax effects as deferred tax assets or liabilities. The change has the effect of increasing the loss of the Company and its subsidiary for the year ended 31 December 2013 by Baht 2.2 million, with insignificant to the loss per share (For the year ended 31 December 2012: decreasing the loss by Baht 1.8 million, with insignificant to the loss per share) (Separate financial statements: for the year ended 31 December 2013, decreasing the loss by Baht 4.6 million, with insignificant to the loss per share (For the year ended 31 December 2012: decreasing the loss by Baht 2.7 million, with insignificant to the loss per share)). The cumulative effect of the changes in the accounting policy has been presented in “Cumulative effect of change in accounting policy for Income Taxes” on the statements of changes in shareholders’ equity.

(b) Accounting standards that will become effective in the future Effective date Accounting Standards: TAS 1 (revised 2012) Presentation of Financial Statements 1 January 2014 TAS 7 (revised 2012) Statement of Cash Flows 1 January 2014 TAS 12 (revised 2012) Income Taxes 1 January 2014 TAS 17 (revised 2012) Leases 1 January 2014 TAS 18 (revised 2012) Revenue 1 January 2014 TAS 19 (revised 2012) Employee Benefits 1 January 2014 TAS 21 (revised 2012) The Effects of Changes in Foreign Exchange Rates 1 January 2014 TAS 24 (revised 2012) Related Party Disclosures 1 January 2014 TAS 28 (revised 2012) Investments in Associates 1 January 2014 TAS 31 (revised 2012) Interests in Joint Ventures 1 January 2014 TAS 34 (revised 2012) Interim Financial Reporting 1 January 2014 TAS 36 (revised 2012) Impairment of Assets 1 January 2014 TAS 38 (revised 2012) Intangible Assets 1 January 2014 Financial Reporting Standards: TFRS 2 (revised 2012) Share-based Payment 1 January 2014 TFRS 3 (revised 2012) Business Combinations 1 January 2014 TFRS 4 Insurance Contracts 1 January 2016 TFRS 5 (revised 2012) Non-current Assets Held for Sale and 1 January 2014 Discontinued Operations TFRS 8 (revised 2012) Operating Segments 1 January 2014 Accounting Standard Interpretations: TSIC 15 Operating Leases - Incentives 1 January 2014 TSIC 27 Evaluating the Substance of Transactions Involving 1 January 2014 the Legal Form of a Lease TSIC 29 Service Concession Arrangements: Disclosures 1 January 2014 TSIC 32 Intangible Assets - Web Site Costs 1 January 2014 Financial Reporting Standard Interpretations: TFRIC 1 Changes in Existing Decommissioning, Restoration 1 January 2014 and Similar Liabilities TFRIC 4 Determining whether an Arrangement contains a 1 January 2014 Lease

Annual Report 2013 Bangkok Metro Public Company Limited 139 EffectiveEffective date date LeaseLease TFRICTFRIC 5 5 RightsRights to to Interests Interests arising arising from from Decommissioning, Decommissioning, 11 January January 2014 2014 RestorationRestoration and and Environmental Environmental Rehabilitation Rehabilitation FundsFunds TFRICTFRIC 7 7 ApplyingApplying the the Restatement Restatement Approach Approach under under TAS TAS 11 January January 2014 2014 2929 Financial Financial Reporting Reporting in in Hyperinflationary Hyperinflationary EconomiesEconomies TFRICTFRIC 10 10 InterimInterim Financial Financial Reporting Reporting and and Impairment Impairment 11 January January 2014 2014 TFRICTFRIC 12 12 ServiceService Concession Concession Arrangements Arrangements 11 January January 2014 2014 TFRICTFRIC 13 13 CustomerCustomer Loyalty Loyalty Programmes Programmes 11 January January 2014 2014 TFRICTFRIC 17 17 DistributionsDistributions of of Non-cash Non-cash Assets Assets to to Owners Owners 11 January January 2014 2014 TFRICTFRIC 18 18 TransfersTransfers of of Assets Assets from from Customers Customers 11 January January 2014 2014

TheThe managementmanagement ofof thethe CompanyCompany andand itsits subsidiarysubsidiary believesbelieves thatthat thesethese accountingaccounting standards,standards, financialfinancial reportingreporting standard, standard, accounting accounting standard standard interpretations interpretations and and financial financial reporting reporting standards standards interpretations interpretations will will notnot havehave anyany significantsignificant impactimpact onon thethe financialfinancial statstatementsements forfor thethe yearyear whenwhen theythey areare initiallyinitially applied,applied, exceptexcept forfor TFRICTFRIC 1212 ServiceService ConcessionConcession ArrangemArrangementsents toto whichwhich thethe managementmanagement isis stillstill evaluatingevaluating thethe impactimpact to to the the financial financial statements statements and and believes believes that that will will not not have have any any significant significant impact. impact.

44. . SSigignnifiifcicaannt ta accccoouunntitningg p poolilcicieiess

44.1.1 RReevveennuueess a anndd e exxppeennsseess r ereccooggnnitiitoionn

a)a) Fare Fare box box revenue revenue recognition recognition Smart Smart cardcard andand smartsmart tokentoken salessales areare recognisedrecognised asas revenuerevenue whenwhen thethe servicesservices areare rendered.rendered. PrepaidPrepaid valuevalue inin storedstored valuevalue smartsmart cardscards isis recordedrecorded asas unearnedunearned farefare boxbox revrevenueenue inin currentcurrent liabilitiesliabilities inin thethe statementstatement of of fi nancialfinancial position. position.

b)b) Commercial Commercial development development revenue revenue Commercial Commercial development development revenue revenue is is recognis recogniseded as as income income when when service service has has been been rendered. rendered.

c)c) Other Other revenues revenues and and expenses expenses recognition recognition An An accrual accrual basis basis of of accountin accountingg is is adopted adopted in in recognition recognition of of other other revenues revenues and and expenses. expenses.

44.2.2 CCaasshh a anndd c caasshh e eqquuivivaalelenntsts Cash Cash andand cashcash equivalentsequivalents consistconsist ofof cashcash inin handhand andand atat banks,banks, andand allall highlyhighly liquidliquid investmentsinvestments withwith anan originaloriginal maturity maturity of of three three months months or or less less and and not not subject subject to to withdrawal withdrawal restrictions. restrictions.

44.3.3 TTraraddee a anndd o oththeer rr erecceeivivaabbleless Trade Trade andand otherother receivablesreceivables areare statedstated atat thethe netnet realisrealisableable value.value. AllowanceAllowance forfor dodoubtfulubtful accountsaccounts isis providedprovided forfor the the estimated estimated losses losses that that may may be be incurred incurred in in collect collectionion of of receivables. receivables. The The allowance allowance is is generally generally based based on on collectioncollection experience experience and and analysis analysis of of debt debt aging. aging.

Annual Report 2013 140 Bangkok Metro Public Company Limited 4.4 Investment Investment in subsidiary, which is accounted for in the separate financial statements, is stated at cost net of allowance for loss on impairment.

4.5 Project costs and Unit of Throughput Amortisation Method (Unit of Throughput/ Unit of Production) The project costs are stated at cost less accumulated amortisation and allowance for loss on impairment of project costs (if any).

The Company All expenditures and other related expenses which are incurred to construct the System and to enable it to become operational (“Project costs”) are capitalised as assets and will be amortised over the concession period after the commencement of operations of the System. Such project costs include management and consultant fees, design costs, electrical and mechanical works and rolling stock purchased during the concession period, interest and other financing expenses.

The Company has been adopting the unit of throughput method to amortise such project costs based on the following formula:

Amortisation for the year = Net project costs at the beginning of the year x Percentage of passengers for the year

Percentage of Passengers = Current year’s actual passengers for the year (Actual passengers for the current year + Projected passengers during the remaining concession year)

Net project costs at the = Total project costs - Accumulated amortisation as at beginning of the beginning of the year year

Subsidiary Amortisation of project costs is calculated by reference to its cost on the straight-line basis over the following estimated useful lives:

Equipment and rental area at 5 years and concession period of subsidiary station improvement Telecommunication equipment 5 years and concession period of subsidiary Advertising equipment 5 years

Amortisation is included in profit or loss.

No amortisation is provided on project costs under construction.

Annual Report 2013 Bangkok Metro Public Company Limited 141 4.6 Equipment/Depreciation Equipment is stated at cost less accumulated depreciation and allowance for loss on impairment of assets (if any).

Depreciation of equipment is calculated by reference to its cost on the straight-line basis over the following estimated useful lives:

Furniture and office equipment 3, 5, 20 years Motor vehicles 5 years

Depreciation is included in profit or loss.

An item of equipment is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on disposal of an asset is included in profit or loss when the asset is derecognised.

4.7 Borrowing costs Borrowing costs directly attributable to the acquisition or construction of an asset that necessarily takes a substantial period of time to get ready for its intended use are capitalised as part of the cost of the respective assets. All other borrowing costs are expensed in the period they are incurred. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds.

4.8 Computer software Computer software is carried at cost less any accumulated amortisation and allowance for impairment losses (if any).

Computer software with finite lives are amortised on a systematic basis over the economic useful life and tested for impairment whenever there is an indication that the computer software may be impaired. The amortisation period and the amortisation method of such computer software are reviewed at least at each financial year end. The amortisation expense is charged to profit or loss.

Computer software has useful lives of 3 and 5 years.

4.9 Goodwill Goodwill is initially recorded at cost, which equals to the excess of the cost of business combination over the fair value of the net assets acquired. If the fair value of the net assets acquired exceeds the cost to business combination, the excess is immediately recognised as gain in profit or loss.

Goodwill is carried at cost less any accumulated impairment losses. Goodwill is tested for impairment annually and when circumstances indicate that the carrying value may be impaired.

For the purpose of impairment testing, goodwill acquired in a business combination is allocated to each of the Company’s cash generating units that are expected to benefit from the synergies of the combination. The Company estimates the recoverable amount of each cash-generating unit to which the goodwill relates. Where the recoverable amount of the cash-generating unit is less than the carrying amount, an impairment loss is recognised in profit or loss. Impairment losses relating to goodwill cannot be reversed in future periods.

Annual Report 2013 142 Bangkok Metro Public Company Limited 4.10 Related party transactions Related parties comprise enterprises and individuals that control, or are controlled by, the Company and its subsidiary, whether directly or indirectly, or which are under common control with the Company and its subsidiary.

They also include associated companies and individuals which directly or indirectly own a voting interest in the Company and its subsidiary that gives them significant influence over the Company and its subsidiary, key management personnel, directors and officers with authority in the planning and direction of the operations of the Company and its subsidiary.

4.11 Long-term leases Leases of equipment which transfer substantially all the risks and rewards of ownership are classified as finance leases. Finance leases are capitalised at the lower of the fair value of the leased assets and the present value of the minimum lease payments. The outstanding rental obligations, net of finance charges, are included in long- term payables, while the interest element is charged to profit or loss over the lease period. The assets acquired under finance leases are depreciated over the useful life of the asset.

Leases of equipment which do not transfer substantially all the risks and rewards of ownership are classified as operating leases. Operating lease payments are recognised as an expense in profit or loss on a straight line basis over the lease term.

4.12 Foreign currencies The consolidated and separate financial statements are presented in Baht, which is also the Company’s functional currency.

Transactions in foreign currencies are translated into Baht at the exchange rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated into Baht at the exchange rate ruling at the end of reporting period.

Gains and losses on exchange are included in profit and loss.

4.13 Impairment of assets At the end of each reporting period, the Company and its subsidiary performs impairment reviews in respect of the project costs, equipment and other intangible assets whenever events or changes in circumstances indicate that an asset may be impaired. An impairment loss is recognised when the recoverable amount of an asset, which is the higher of the asset’s fair value less costs to sell and its value in use, is less than the carrying amount. In determining value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs to sell, an appropriate valuation model is used. These calculations are corroborated by a valuation model that, based on information available, reflects the amount that the Company and its subsidiary could obtain from the disposal of the asset in an arm’s length transaction between knowledgeable, willing parties, after deducting the costs of disposal.

An impairment loss is recognised in profit or loss.

Annual Report 2013 Bangkok Metro Public Company Limited 143 4.14 Employee benefits Deferred tax Deferred income tax is provided on temporary differences between the tax bases of assets and liabilities and Short-term employee benefits their carrying amounts at the end of each reporting period, using the tax rates enacted at the end of the Salaries, wages, bonuses and contributions to the social security fund are recognised as expenses when reporting period. incurred. The Company and its subsidiary recognise deferred tax liabilities for all taxable temporary differences while they Post-employment benefits recognise deferred tax assets for all deductible temporary differences and tax losses carried forward to the extent that it is probable that future taxable profit will be available against which such deductible temporary Defined contribution plans differences and tax losses carried forward can be utilised. The Company, its subsidiary and its employees have jointly established a provident fund. The fund is monthly contributed by employees and by the Company and its subsidiary. The fund’s assets are held in a separate trust At each reporting date, the Company and its subsidiary review and reduce the carrying amount of deferred tax assets to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part fund and the contributions of the Company and its subsidiary are recognised as expenses when incurred. of the deferred tax asset to be utilised.

Defined benefit plans The Company and its subsidiary record deferred tax directly to shareholders' equity if the tax relates to items The Company and its subsidiary have obligations in respect of the severance payments they must make to that are recorded directly to shareholders' equity. employees upon retirement under labor law. The Company and its subsidiary treat these severance payment obligations as a defined benefit plan. 5. Significant accounting judgements and estimates The obligation under the defined benefit plan is determined by a professionally qualified independent actuary based on actuarial techniques, using the projected unit credit method. The preparation of financial statements in conformity with financial reporting standards at times requires management to make subjective judgements and estimates regarding matters that are inherently uncertain. Actuarial gains and losses arising from post-employment benefits are recognised immediately in profit or loss. These judgements and estimates affect reported amounts and disclosures; and actual results could differ from these estimates. Significant judgements and estimates are as follows: The defined benefits liability comprises the present value of the defined benefit obligation. Leases For the first-time adoption of TAS 19 Employee Benefits in 2011, the Company and its subsidiary elected to In determining whether a lease is to be classified as an operating lease or finance lease, the management is required to use judgement regarding whether significant risk and rewards of ownership of the leased asset has recognise the transitional liability, which exceeds the liability that would have been recognised at the same date been transferred, taking into consideration terms and conditions of the arrangement. under the previous accounting policy, as an expense on a straight-line basis over up to five years from the date of adoption. Allowance for doubtful accounts In determining an allowance for doubtful accounts, the management needs to make judgement and estimates 4.15 Provisions based upon, among other things, past collection history, aging profile of outstanding debts and the prevailing Provisions are recognised when the Company and its subsidiary have a present obligation as a result of a past economic condition. event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. Goodwill and intangible assets The initial recognition and measurement of goodwill and other intangible assets, and subsequent impairment 4.16 Income tax testing, require management to make estimates of cash flows to be generated by the asset or the cash Income tax expense represents the sum of corporate income tax currently payable and deferred tax. generating units and to choose a suitable discount rate in order to calculate the present value of those cash flows. Current tax Current income tax is provided in the accounts at the amount expected to be paid to the taxation authorities, based on taxable profits determined in accordance with tax legislation.

Annual Report 2013 144 Bangkok Metro Public Company Limited Deferred tax Deferred income tax is provided on temporary differences between the tax bases of assets and liabilities and their carrying amounts at the end of each reporting period, using the tax rates enacted at the end of the reporting period.

The Company and its subsidiary recognise deferred tax liabilities for all taxable temporary differences while they recognise deferred tax assets for all deductible temporary differences and tax losses carried forward to the extent that it is probable that future taxable profit will be available against which such deductible temporary differences and tax losses carried forward can be utilised.

At each reporting date, the Company and its subsidiary review and reduce the carrying amount of deferred tax assets to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised.

The Company and its subsidiary record deferred tax directly to shareholders' equity if the tax relates to items that are recorded directly to shareholders' equity.

5. Significant accounting judgements and estimates

The preparation of financial statements in conformity with financial reporting standards at times requires management to make subjective judgements and estimates regarding matters that are inherently uncertain. These judgements and estimates affect reported amounts and disclosures; and actual results could differ from these estimates. Significant judgements and estimates are as follows:

Leases In determining whether a lease is to be classified as an operating lease or finance lease, the management is required to use judgement regarding whether significant risk and rewards of ownership of the leased asset has been transferred, taking into consideration terms and conditions of the arrangement.

Allowance for doubtful accounts In determining an allowance for doubtful accounts, the management needs to make judgement and estimates based upon, among other things, past collection history, aging profile of outstanding debts and the prevailing economic condition.

Goodwill and intangible assets The initial recognition and measurement of goodwill and other intangible assets, and subsequent impairment testing, require management to make estimates of cash flows to be generated by the asset or the cash generating units and to choose a suitable discount rate in order to calculate the present value of those cash flows.

Annual Report 2013 Bangkok Metro Public Company Limited 145 Deferred tax assets (Unit: Million Baht) Deferred tax assets are recognised for deductible temporary differences and unused tax losses to the extent that Consolidated Separate it is probable that taxable profit will be available against which the temporary differences and losses can be financial statements financial statements Transfer pricing policy utilised. Significant management judgement is required to determine the amount of deferred tax assets that can 2013 2012 2013 2012 be recognised, based upon the likely timing and level of estimate future taxable profits. Costs of commercial development Remuneration from commercial Post-employment benefits under defined benefit plans development revenue 64 41 62 39 Concession agreement The obligation under the defined benefit plan is determined based on actuarial techniques. Such determination is Administrative expenses made based on various assumptions, including discount rate, future salary increase rate, mortality rate and staff Office rental and service 7 6 - - Contract rate turnover rate. Finance cost Interest expense 233 246 223 235 Contract rate

Estimated number of passengers As at 31 December 2013 and 2012, the balances of the accounts between the Company and its subsidiary and Estimation of the number of passengers over the life of the concession period, which is used for the calculation of the related companies are as follows: project costs amortisation, requires use of assumptions as to matters such as the traffic model, the metro network (Unit: Thousand Baht) model, average fuel costs and fare box structure. Consolidated Separate financial statements financial statements Impairment testing of project cost 2013 2012 2013 2012 Impairment testing of project costs at the end of each reporting period requires management to prepare projections of Trade and other receivables - related party (Note 8) the cash flows expected to be generated by the project costs or the cash generating units and to choose a suitable Subsidiary discount rate in order to calculate the present value of those cash flows. - Bangkok Metro Networks Limited - - 30,392 33,567 - - 30,392 33,567 Impairment of investment in subsidiary Construction payables and other payables - The Company reviews impairment of investment in subsidiary, which requires management to prepare projections related parties (Note 14) of the cash flows expected to be generated by the investment in the future, and to choose a suitable discount - CH. Karnchang Public Company Limited 1,067 574 1,000 500 rate in order to calculate the present value of those cash flows. - MRTA 7,524 23,624 7,524 23,624 - Others 1,298 662 - - 9,889 24,860 8,524 24,124 6. Related party transactions Construction payable and accrued interest to related party - CH. Karnchang Public Company Limited During the years, the Company and its subsidiary had significant business transactions with related parties. Such Current portion transactions, which are summarised below, arose in the ordinary course of business and were concluded on Accrued interest (Note 14) 596 10,658 - - commercial terms and bases agreed upon between the Company and its subsidiary and those related parties. Long-term portion Construction payable 60,186 130,186 - - (Unit: Million Baht) 60,782 140,844 - - Consolidated Separate Long-term loans from shareholder and accrued interest financial statements financial statements Transfer pricing policy - CH. Karnchang Public Company Limited 2013 2012 2013 2012 Long-term loans - 3,000,000 - 3,000,000 Transactions with subsidiary company Accrued interest - 980,988 - 980,988 (eliminated from the consolidated financial statements) - 3,980,988 - 3,980,988 Commercial development revenue - - 196 134 Contract rate Unearned revenue from advertising management rights Transactions with related companies Subsidiary Costs of fare box - Bangkok Metro Networks Limited Remuneration from fare box revenue 20 18 20 18 Concession agreement Current portion (Note 14, 16) - - 2,625 7,000 Long-term portion (Note 16) - - 18,375 21,000 - - 21,000 28,000

Annual Report 2013 146 Bangkok Metro Public Company Limited (Unit: Million Baht) Consolidated Separate financial statements financial statements Transfer pricing policy 2013 2012 2013 2012 Costs of commercial development Remuneration from commercial development revenue 64 41 62 39 Concession agreement Administrative expenses Office rental and service 7 6 - - Contract rate Finance cost Interest expense 233 246 223 235 Contract rate

As at 31 December 2013 and 2012, the balances of the accounts between the Company and its subsidiary and related companies are as follows: (Unit: Thousand Baht) Consolidated Separate financial statements financial statements 2013 2012 2013 2012 Trade and other receivables - related party (Note 8) Subsidiary - Bangkok Metro Networks Limited - - 30,392 33,567 - - 30,392 33,567 Construction payables and other payables - related parties (Note 14) - CH. Karnchang Public Company Limited 1,067 574 1,000 500 - MRTA 7,524 23,624 7,524 23,624 - Others 1,298 662 - - 9,889 24,860 8,524 24,124 Construction payable and accrued interest to related party - CH. Karnchang Public Company Limited Current portion Accrued interest (Note 14) 596 10,658 - - Long-term portion Construction payable 60,186 130,186 - - 60,782 140,844 - - Long-term loans from shareholder and accrued interest - CH. Karnchang Public Company Limited Long-term loans - 3,000,000 - 3,000,000 Accrued interest - 980,988 - 980,988 - 3,980,988 - 3,980,988 Unearned revenue from advertising management rights Subsidiary - Bangkok Metro Networks Limited Current portion (Note 14, 16) - - 2,625 7,000 Long-term portion (Note 16) - - 18,375 21,000 - - 21,000 28,000

Annual Report 2013 Bangkok Metro Public Company Limited 147 Construction payable and accrued interest to related party Most of outstanding balances of construction payable and accrued interest to related party represent payable of the construction and infrastructure system design of retail space in the underground stations which the subsidiary has to pay to a related party. These outstanding balances were subject to interest at MLR plus 1 percent per annum.

In accordance with the conditions stipulated in the long-term loan agreement (note 15), the subsidiary can settle loans and amounts payable to related company and/or group company if the subsidiary receives approval from the bank with respect to the arrangement of sufficient cash flows for its operations and financing costs. Later, in December 2013, the subsidiary obtained a long-term loan amounting to Baht 70 million from a commercial bank (note 15) to make partial settlement of construction payable to a related party. The subsidiary does not plan to repay the outstanding balance of construction payable within 1 year and so all construction payable is classified as non-current liabilities.

Long-term loans from shareholder and accrued interest During year 2013, the movements of long-term loans from shareholder and accrued interest were as follows: (Unit: Thousand Baht) Consolidated financial statements and separate financial statements Balance as at Increase Decrease Balance as at Loans Related by 1 January 2013 during the year during the year 31 December 2013 CH. Karnchang Public Major Company Limited shareholder Long-term loans 3,000,000 - (3,000,000) - Accrued interest 980,988 222,945 (1,203,933) - Total 3,980,988 222,945 (4,203,933) -

The outstanding balances of long-term loans from shareholder represent loans from CH. Karnchang Public Company Limited under the Subordinated Loan Agreements that the Company entered into with CH. Karnchang Public Company Limited and a group of domestic lenders of the Company, under which the shareholder granted long-term loan facilities totaling Baht 3,000 million. The loans carry interest at a rate close to MLR, and principal and interest are to be paid after the Company has settled all indebtedness under the Onshore Facilities Agreement (note 15) or when the Company has excess cash. Later, on 23 December 2013, the group of domestic lenders consented to the Company making settlement of all long-term loans from the shareholder, together with accrued interest, using the paid-in proceeds from its capital increase.

Directors and management’s remuneration During the years ended 31 December 2013 and 2012, the Company and its subsidiary had employee benefit expenses of their directors and management as below. (Unit: Thousand Baht) Consolidated Separate financial statements financial statements 2013 2012 2013 2012 Short-term employee benefits 45,485 43,493 36,522 35,016 Post-employment benefits 2,644 2,629 2,605 1,880 Total 48,129 46,122 39,127 36,896

Annual Report 2013 148 Bangkok Metro Public Company Limited 7. Cash and cash equivalents (Unit: Thousand Baht) Consolidated Separate financial statements financial statements 2013 2012 2013 2012 Cash 36,855 29,100 36,765 29,010 Bank deposits 2,157,754 53,865 2,148,417 50,556 Total 2,194,609 82,965 2,185,182 79,566

The Company has pledged its rights to receive deposits from bank accounts, with outstanding balances as at 31 December 2013 of approximately Baht 2,140 million (2012: Baht 51 million) with a group of domestic lenders to secure its long-term loans from those lenders. The Company is able to withdraw these deposits for its use of regular operation.

8. Trade and other receivables (Unit: Thousand Baht) Consolidated Separate financial statements financial statements 2013 2012 2013 2012 Trade receivables Trade receivable - Related party (Note 6) - - 30,392 33,567 - Unrelated parties 77,332 59,964 - - Less: Allowance for doubtful debts (4,493) (4,438) - - Total trade receivables - net 72,839 55,526 30,392 33,567 Other receivables Advances 531 1,092 - 22 Accrued income 5,154 159 5,154 159 Other receivables 4,199 4,511 4,192 4,506 Total other receivables 9,884 5,762 9,346 4,687 Trade and other receivables - net 82,723 61,288 39,738 38,254

Most of the trade accounts receivable were within their credit terms. The Company and its subsidiary have assessed the recoverable value of the receivables. As at 31 December 2013, the outstanding balances of such receivables that are one year or more past due amounted to approximately Baht 6 million (2012: Baht 3 million) (The separate financial statements: Nil) and allowance for doubtful accounts of the receivables that are over one year of Baht 4 million was recorded (2012: Baht 4 million) (The separate financial statements: Nil).

9. Investment in subsidiary (Unit: Thousand Baht) Separate financial statements 2013 2012 Cost 165,586 165,586 Less: Allowance for loss on impairment of investment in subsidiary (16,000) (16,000) Investment in subsidiary - net 149,586 149,586

The Company has pledged all share certificates of investment in the subsidiary with a group of domestic lenders to secure its long-term loans from those lenders.

Annual Report 2013 Bangkok Metro Public Company Limited 149 10. Project costs (Unit: Thousand Baht) Consolidated financial statements Equipment and MRT rental area at station Telecommunication Advertising Project costs equipment improvement equipment equipment under construction Total Cost: As at 1 January 2012 19,442,270 148,292 50,386 65,472 217,097 19,923,517 Additions 98,045 105 - 1,007 8,273 107,430 Write off (33) - - - - (33) Transfer 16,151 1,065 - - (17,216) - As at 31 December 2013 19,556,433 149,462 50,386 66,479 208,154 20,030,914 Additions 2,949 564 23 500 28,618 32,654 Disposals - - - (1,641) - (1,641) Transfer - 47,663 21,431 - (69,094) - As at 31 December 2013 19,559,382 197,689 71,840 65,338 167,678 20,061,927 Accumulated amortisation: As at 1 January 2012 1,685,574 41,213 20,661 53,801 - 1,801,249 Amortisation for the year 323,684 8,975 3,545 5,752 - 341,956 Amortisation on write off (2) - - - - (2) As at 31 December 2012 2,009,256 50,188 24,206 59,553 - 2,143,203 Amortisation for the year 348,099 9,568 4,693 3,042 - 365,402 Amortisation on disposals - - - (1,638) - (1,638) As at 31 December 2013 2,357,355 59,756 28,899 60,957 - 2,506,967 Net book value: As at 31 December 2012 17,547,177 99,274 26,180 6,926 208,154 17,887,711 As at 31 December 2013 17,202,027 137,933 42,941 4,381 167,678 17,554,960 Amortisation for the year: 2012 341,956 2013 365,402

Annual Report 2013 150 Bangkok Metro Public Company Limited (Unit: Thousand Baht) Separate financial statements Project costs MRT Under equipment Construction Total Cost: As at 1 January 2012 19,442,270 15,372 19,457,642 Additions 98,045 779 98,824 Write off (33) - (33) Transfer 16,151 (16,151) - As at 31 December 2012 19,556,433 - 19,556,433 Additions 2,949 - 2,949 As at 31 December 2013 19,559,382 - 19,559,382 Accumulated amortisation: As at 1 January 2012 1,685,574 - 1,685,574 Amortisation for the year 323,684 - 323,684 Amortisation on write off (2) - (2) As at 31 December 2012 2,009,256 - 2,009,256 Amortisation for the year 348,099 - 348,099 As at 31 December 2013 2,357,355 - 2,357,355 Net book value: As at 31 December 2012 17,547,177 - 17,547,177 As at 31 December 2013 17,202,027 - 17,202,027 Amortisation for the year: 2012 323,684 2013 348,099

As at 31 December 2013, certain project costs had been fully amortised but were still in use. The gross carrying amount before deduction accumulated amortisation of those assets amounted to approximately Baht 66 million (2012: Baht 51 million) (The separate financial statements: Nil).

Project costs consist of M&E equipment, depot building and administration building. They will be transferred to the MRTA at the end of the concession period of 25 years, on an Acquire, Operate and Transfer basis.

The Company has pledged M&E equipment, depot building and administration building of the Project with a group of domestic lenders to secure its long-term loans from those lenders. In addition, the subsidiary has pledged part of its telecommunication equipment with the lender to secure the subsidiary’s long-term loan.

Annual Report 2013 Bangkok Metro Public Company Limited 151 11. Equipment

(Unit: Thousand Baht) Consolidated financial statements Office Office Motor equipment furniture vehicles Total Cost: As at 1 January 2012 85,994 36,301 21,417 143,712 Additions 3,429 682 - 4,111 Disposals/write off (202) (8) (2,703) (2,913) As at 31 December 2012 89,221 36,975 18,714 144,910 Additions 8,481 270 1,467 10,218 Disposals/write off (290) - (2,790) (3,080) As at 31 December 2013 97,412 37,245 17,391 152,048 Accumulated depreciation: As at 1 January 2012 78,470 29,490 20,402 128,362 Depreciation for the year 3,609 1,166 486 5,261 Depreciation on disposals/write off (197) (5) (2,702) (2,904) As at 31 December 2012 81,882 30,651 18,186 130,719 Depreciation for the year 4,153 1,014 267 5,434 Depreciation on disposals/write off (262) - (2,790) (3,052) As at 31 December 2013 85,773 31,665 15,663 133,101 Net book value: As at 31 December 2012 7,339 6,324 528 14,191 As at 31 December 2013 11,639 5,580 1,728 18,947 Depreciation for the year: 2012 (included in administrative expenses) 5,261 2013 (included in administrative expenses) 5,434

Annual Report 2013 152 Bangkok Metro Public Company Limited (Unit: Thousand Baht) Separate financial statements Office Office Motor equipment furniture vehicles Total Cost: As at 1 January 2012 77,017 31,109 14,756 122,882 Additions 2,746 658 - 3,404 Write off (202) (8) (2,703) (2,913) As at 31 December 2012 79,561 31,759 12,053 123,373 Additions 7,398 260 8 7,666 Write off (290) - - (290) As at 31 December 2013 86,669 32,019 12,061 130,749 Accumulated depreciation: As at 1 January 2012 70,353 24,420 13,792 108,565 Depreciation for the year 3,054 1,102 434 4,590 Depreciation on write off (197) (5) (2,702) (2,904) As at 31 December 2012 73,210 25,517 11,524 110,251 Depreciation for the year 3,503 969 170 4,642 Depreciation on write off (262) - - (262) As at 31 December 2013 76,451 26,486 11,694 114,631 Net book value: As at 31 December 2012 6,351 6,242 529 13,122 As at 31 December 2013 10,218 5,533 367 16,118 Depreciation for the year: 2012 (included in administrative expense) 4,590 2013 (included in administrative expense) 4,642

As at 31 December 2013, certain office furniture and office equipment and motor vehicles items had been fully depreciated but were still in use. The gross carrying amount before deducting accumulated depreciation of those assets amounted to approximately Baht 120 million (2012: Baht 118 million) (Separate financial statements: Baht 102 million, 2012: Baht 99 million).

Annual Report 2013 Bangkok Metro Public Company Limited 153 12. Computer software (Unit: Thousand Baht) Consolidated Separate financial statements financial statements Cost: As at 1 January 2012 30,551 29,421 As at 31 December 2012 30,551 29,421 Additions 359 159 As at 31 December 2013 30,910 29,580 Amortisation and impairment: As at 1 January 2012 28,374 27,244 Amortisation 709 709 As at 31 December 2012 29,083 27,953 Amortisation 643 626 As at 31 December 2013 29,726 28,579 Net book value: As at 31 December 2012 1,468 1,468 As at 31 December 2013 1,184 1,001

13. Bank overdraft

Bank overdraft is secured by pledges of the subsidiary’s share certificates which are held by shareholders other than the Company, the transfer of rights to receive revenue from 6 telecommunication customers, revenue from the Passenger Information Display business (PID), revenue from the Platform Screen Door advertising, and revenue from Digital Media advertising, and the pledge of part of its telecommunication equipment.

As at 31 December 2013, the short-term loan from financial institute facilities of its subsidiary which have not yet been drawn down amounted to Baht 30 million (2012: Nil).

14. Construction payables and other payables (Unit: Thousand Baht) Consolidated Separate financial statements financial statements 2013 2012 2013 2012 Construction and other payables - Related parties (Note 6) 9,889 24,860 8,524 24,124 - Unrelated parties 365,623 333,244 352,476 326,744 Accrued interest on construction payable to related party (Note 6) 596 10,658 - - Accrued expenses 138,074 161,781 129,940 156,952 Unearned revenue from advertising management rights (Note 6, 16) - - 2,625 7,000 Others 10,944 9,893 1,110 846 Total construction payables and other payables 525,126 540,436 494,675 515,666

Annual Report 2013 154 Bangkok Metro Public Company Limited 15. Long-term loans from financial institutions and accrued interest

The Company and its subsidiary have long-term loan agreements with commercial banks as follows: (Unit: Thousand Baht) Interest rate Consolidated Separate Loan (% p.a.) Repayment schedule financial statements financial statements 2013 2012 2013 2012

The Company Closed to MLR Repayment in quarterly installments commencing September 2016, 10,602,500 10,602,500 10,602,500 10,602,500 (Tranche A) with the final installment due in December 2024 (According to Supplemental Agreement to the Onshore Facilities Agreement No. 6) Subsidiary MLR Repayment in quarterly installments commencing April 2010, with the 89,500 99,500 - - final installment due in January 2018 Subsidiary MLR Repayment in quarterly installments commencing March 2013, with the 10,500 - - - final installment due in December 2014 Subsidiary MLR Repayment in quarterly installments commencing March 2014, with the 70,000 - - - final installment due in December 2018 Long-term loans 10,772,500 10,702,000 10,602,500 10,602,500 Add: Accrued interest 162 1,552,943 - 1,552,867

Bangkok Metro Public CompanyLimited 10,772,662 12,254,943 10,602,500 12,155,367 Less: Current portion (33,162) (10,076) - - Long-term loans from financial institutions and accrued interest - net of current portion 10,739,500 12,244,867 10,602,500 12,155,367

Annual Report 2013 155 Movements in the long-term loans from financial institutions and accrued interest account during the year ended 31 December 2013 are summarised below. (Unit: Thousand Baht) Consolidated Separate financial statements financial statements Balance as at 1 January 2013 12,254,943 12,155,367 Add: Drawn down 91,000 - Add: Increase in accrued interest 802,917 795,187 Less: Repayment of loan (20,500) - Less: Payment of interest (2,355,698) (2,348,054) Balance as at 31 December 2013 10,772,662 10,602,500

The Company’s loans Later, on 29 August 2008, the Company entered into the “Supplemental Agreement to the Onshore Facilities Agreement No.5” with the group of domestic lenders, in order to revise the conditions of a loan agreement. In March 2013, the Company entered into the “Supplemental Agreement to the Onshore Facilities Agreement No.6 with the group of domestic lenders under which the group of domestic lenders agreed to revise the conditions of the loan agreement, with an extension of the grace period, and revision of the amounts of principal and interest payable in each installment.

The Supplemental Agreement to the Onshore Facilities Agreement No.6 became effective on 9 May 2013, after the Company fulfilled certain conditions stipulated in the agreement.

In December 2013, the Company paid rescheduling fees of the Supplemental Agreement to the Onshore Facilities Agreement No.5 and No.6 amounting to Baht 422 million, accrued interest on long-term loans amounting to Baht 1,897 million and estimated interest for the period of 1 January 2014 to 31 March 2014, amounting to Baht 78 million which is presented under the caption of “Prepaid interest of long-term loan” in the statement of financial position. The total fees are according to letter of the revision of the conditions of accrued interest payment and the calculation of rescheduling fees from 1 April 2014 onwards.

The loans are secured by the mortgage of M&E equipment of the project, a depot building and administration building, pledges of the Company’s share certificates and share certificates for investment in a subsidiary, and the assignment of rights and obligations under the concession agreement and the rights to receive deposits at banks.

The loan agreements include covenants imposed by the lenders concerning, among other things, the percentage shareholdings of the principal shareholders, changes in the Company’s management, entering into other loan agreements, entering into any new business or activity which is not related to the Project, the maintenance of certain financial ratios.

Loan of subsidiary The long-term loans from financial institutions is secured by pledges of the subsidiary’s share certificates which are held by shareholders other than the Company, the transfer of rights to receive revenue from 6 telecommunication customers, revenue from the Passenger Information Display business (PID), revenue from the Platform Screen Door advertising, and revenue from Digital Media, and the pledge of part of its telecommunication equipment to the lenders.

The loan agreement includes covenants imposed by the lender concerning, among other things, the proportion of shareholding of the principal shareholders, repayment of loan and amounts payable to related companies and/or group companies, dividend payment and the maintenance of certain financial ratios.

Annual Report 2013 156 Bangkok Metro Public Company Limited 16. Unearned revenue from advertising management rights

The Company entered into a contract granting commercial development rights to the subsidiary, to manage advertising services through the Passenger Information Display System (PID), which is installed in underground stations and on trains. The agreement will expire at the end of the fifth year from the date the Company notifies the subsidiary of the commencement of advertising services through the PID. Subsequently, the Company extended the contract period to 31 December 2021.

Under this agreement, the Company received remuneration from the subsidiary amounting to Baht 35 million which is presented under the caption of “Unearned revenue from advertising management rights” and amortised throughout the contract period. Moreover, the Company received an additional annual remuneration fee calculated at the rates ranging from 20% to 35% of revenue from advertising services in each year.

Movements in unearned revenue from advertising management rights account during the year ended 31 December 2013 are summarised below. (Unit: Thousand Baht) Separate financial statements Balance as at 1 January 2013 28,000 Less: Transfer to revenue (7,000) Balance as at 31 December 2013 21,000 Less: Current portion (2,625) Unearned revenue from advertising management rights - net of current portion 18,375

17. Fare box revenue and commercial development revenue Under the Concession Agreement, the Company has agreed to pay a fee to the MRTA based on the apportionment of revenue from fares and revenue from commercial development, as follows:

17.1 Remuneration from fares - Annual remuneration The Company agrees to apportion revenue from fares to the MRTA on an annual basis, commencing from the 11th year after commencement of the revenue-generating service until the end of the contract period. Total commitments amount to Baht 43,567 million (inclusive of VAT), with annual commitments in the amounts stipulated in the agreement.

- Percentage remuneration The Company agrees to apportion fares revenue to the MRTA in the form of monthly payments, at a percentage of total revenue from fares (inclusive of VAT) from the year it commences the revenue- generating service. The rates are 1 percent for the 1st - 14th years, 2 percent for the 15th year, 5 percent for the 16th - 18th years and 15 percent for the 19th - 25th years.

Annual Report 2013 Bangkok Metro Public Company Limited 157 17.2 Remuneration from commercial development - Annual remuneration The Company agrees to apportion revenue from commercial development to the MRTA on an annual basis from the year it commences the revenue-generating service until the end of the contract period. Total commitments amount to Baht 930 million (inclusive of VAT) with commitments in the amounts stipulated in the agreement.

- Percentage remuneration The Company agrees to apportion 7 percent of annual revenue from commercial development (inclusive of VAT) to the MRTA in the form of monthly payments, from the year it commences the revenue- generating service until the end of the contract period.

18. Provision for long-term employee benefits

Provision for long-term employee benefits which is compensations on employees’ retirement, was as follows: (Unit: Thousand Baht) Consolidated Separate financial statements financial statements 2013 2012 2013 2012 Defined benefit obligation at beginning of year 48,399 39,285 43,195 35,061 Current service cost 10,991 7,080 10,063 6,423 Interest cost 2,340 1,768 2,174 1,578 Benefits paid during the year (3,103) (20) (3,103) (20) Actuarial loss 7,847 286 8,786 153 Defined benefit obligation at end of year 66,474 48,399 61,115 43,195 Unrecognised transitional provisions (11,761) (17,642) (10,512) (15,768) Provisions for long-term employee benefits at end of year 54,713 30,757 50,603 27,427

Long-term employee benefit expenses included in the profit or loss were as follows: (Unit: Thousand Baht) Consolidated Separate financial statements financial statements 2013 2012 2013 2012 Current service cost 10,991 7,080 10,063 6,423 Interest cost 2,340 1,768 2,174 1,578 Actuarial loss recognised during the year 7,847 286 8,786 153 Transitional liability recognised during the year 5,880 5,880 5,256 5,256 Total expense recognized in profit or loss 27,058 15,014 26,279 13,410 Line items under which such expenses are included in loss Cost of fare box 10,040 6,664 10,040 6,664 Cost of commercial development 433 312 44 23 Selling expenses 143 127 - - Administrative expenses 14,102 6,143 14,021 5,145 Finance Cost 2,340 1,768 2,174 1,578

Annual Report 2013 158 Bangkok Metro Public Company Limited Principal actuarial assumptions at the valuation date were as follows: Consolidated Separate financial statements financial statements 2013 2012 2013 2012 (% per annum) (% per annum) (% per annum) (% per annum) Discount rate 3.9, 4.4 4.5 4.4 4.5 Future salary increase rate 6.0-7.0 7.0 6.0-7.0 7.0 Staff turnover rate (depending on age) 2.5-19.0 5.0 2.5-19.0 5.0

Amounts of defined benefit obligation for the current and previous four years are as follows: (Unit: Thousand Baht) Defined benefit obligation Experience adjustments on the obligation Consolidated Separate financial Consolidated Separate financial financial statements statements financial statements statements Year 2013 66,474 61,115 1,920 1,074 Year 2012 48,399 43,195 - - Year 2011 39,285 35,061 - - Year 2010 29,402 26,280 - - Year 2009 23,570 21,099 - -

19. Share capital

On 11 November 2013, the Extraordinary General Meeting of Shareholders No. 1/2556 approved the increase in the Company’s registered capital from Baht 11,950 million (11,950 million ordinary shares of Baht 1 each) to Baht 20,500 million (20,500 million ordinary shares of Baht 1 each). Details of the allocation of the newly issued ordinary shares were as follows:

a) The 8,550 million newly issued ordinary shares with a par value of Baht 1 each are to be allocated to existing shareholders of the Company in proportion to their shareholding (the allocation ratio is 1 new share for every 1.3977 existing ordinary shares) at an offering price of Baht 1 each. b) Any new ordinary shares remaining after the allocation described in a) are to be offered to existing shareholders who subscribed to buy more shares than their allocation. c) Any new ordinary shares remaining after the allocation described in b) are to be offered through private placements. An Extraordinary General Meeting of the Shareholders passed a resolution granting the Executive Committee or a person designated by the Executive Committee authority to allocate the remaining shares by private placement.

After the Company allocated the newly issued ordinary shares described in a) and b), it registered the increase of its capital from Baht 11,950 million (11,950 million ordinary shares of Baht 1 each) to Baht 18,226 million (18,226 million ordinary shares of Baht 1 each) with the Ministry of Commerce on 18 December 2013. On 18 December 2013, the Executive Committee approved the allocation of the remaining shares described in a) and b) to the group of domestic lenders, and on 25 December 2013 the Company registered the increase of its capital from Baht 18,226 million (18,226 million ordinary shares of Baht 1 each) to Baht 20,500 million (20,500 million ordinary shares of Baht 1 each) with the Ministry of Commerce.

Annual Report 2013 Bangkok Metro Public Company Limited 159 20. Expenses by nature Reconciliation between income tax expenses and the product of accounting profit multiplied by the applicable tax rates for the years ended 31 December 2013 and 2012 are as follows: Significant expenses by nature are as follow: (Unit: Thousand Baht) (Unit: Thousand Baht) Consolidated Separate Consolidated Separate financial statements financial statements financial statements financial statements 2013 2012 2013 2012 2013 2012 2013 2012 (restated) (restated) Salary and wages and other benefits 407,869 468,792 361,584 427,042 Accounting loss before tax (762,679) (980,512) (795,650) (981,906) Depreciation and other amortisation 6,077 5,970 5,268 5,299 Amortisation on project costs 365,402 341,956 348,099 323,684 Applicable tax rate 20% 23% 20% 23% Repair and maintenance expenses 460,988 521,020 447,197 515,083 Accounting profit before tax multiplied by applicable Utilities expenses 418,102 391,216 396,620 384,077 tax rate (152,536) (225,518) (159,130) (225,838) Insurance expenses 79,076 73,368 78,549 72,874 Effects of changes in the applicable tax rates - 561 - 402 Remuneration fees under concession agreement 89,089 63,325 86,934 61,273 Effects of: Consulting fee 21,303 25,367 18,094 21,964 Non-deductible expenses 2,339 27,001 2,053 26,550 Additional expense deductions allowed (35,029) (693) (35,021) (686) Tax loss 187,463 196,894 187,463 196,894 21. Income tax Total 154,773 223,202 154,495 222,758 Income tax expenses reported in the statement of Income tax expenses for the years ended 31 December 2013 and 2012 are made up as follows: comprehensive income 2,237 (1,755) (4,635) (2,678) (Unit: Thousand Baht) Consolidated Separate The components of deferred tax assets and deferred tax liabilities are as follows: financial statements financial statements (Unit: Thousand Baht) 2013 2012 2013 2012 Statements of financial position (restated) (restated) Consolidated financial statements Separate financial statements Current income tax: As at As at As at As at As at As at Current income tax charge 31 December 31 December 1 January 31 December 31 December 1 January - - - - 2013 2012 2012 2013 2012 2012 Deferred tax: (restated) (restated) Relating to origination and reversal of temporary Deferred tax assets differences 2,237 (1,755) (4,635) (2,678) Allowance for doubtful 898 888 143 - - - Income tax expense reported in the statement of accounts comprehensive income 2,237 (1,755) (4,635) (2,678) Provision for long-term employee benefits 10,943 6,151 3,153 10,120 5,485 2,807 Unused tax loss 220 7,259 9,247 - - - Total 12,061 14,298 12,543 10,120 5,485 2,807

The Company and its subsidiary calculated deferred tax assets based on a reduction in the corporate income tax rate from 30 percent to 23 percent in 2012, and then to 20 percent in 2013 and 2014, incompliance with Royal Decree dated December 2011 governing corporate income tax reduction.

As at 31 December 2013, the Company had deductible temporary differences and unused tax losses totaling Baht 5,249 million (2012: Baht 5,782 million), on which deferred tax assets have not been recognised as the Company believes future taxable profits may not be sufficient to allow utilisation of the temporary differences and unused tax losses.

Annual Report 2013 160 Bangkok Metro Public Company Limited Reconciliation between income tax expenses and the product of accounting profit multiplied by the applicable tax rates for the years ended 31 December 2013 and 2012 are as follows: (Unit: Thousand Baht) Consolidated Separate financial statements financial statements 2013 2012 2013 2012 (restated) (restated) Accounting loss before tax (762,679) (980,512) (795,650) (981,906)

Applicable tax rate 20% 23% 20% 23% Accounting profit before tax multiplied by applicable tax rate (152,536) (225,518) (159,130) (225,838) Effects of changes in the applicable tax rates - 561 - 402 Effects of: Non-deductible expenses 2,339 27,001 2,053 26,550 Additional expense deductions allowed (35,029) (693) (35,021) (686) Tax loss 187,463 196,894 187,463 196,894 Total 154,773 223,202 154,495 222,758 Income tax expenses reported in the statement of comprehensive income 2,237 (1,755) (4,635) (2,678)

The components of deferred tax assets and deferred tax liabilities are as follows: (Unit: Thousand Baht) Statements of financial position Consolidated financial statements Separate financial statements As at As at As at As at As at As at 31 December 31 December 1 January 31 December 31 December 1 January 2013 2012 2012 2013 2012 2012 (restated) (restated) Deferred tax assets Allowance for doubtful 898 888 143 - - - accounts Provision for long-term employee benefits 10,943 6,151 3,153 10,120 5,485 2,807 Unused tax loss 220 7,259 9,247 - - - Total 12,061 14,298 12,543 10,120 5,485 2,807

The Company and its subsidiary calculated deferred tax assets based on a reduction in the corporate income tax rate from 30 percent to 23 percent in 2012, and then to 20 percent in 2013 and 2014, incompliance with Royal Decree dated December 2011 governing corporate income tax reduction.

As at 31 December 2013, the Company had deductible temporary differences and unused tax losses totaling Baht 5,249 million (2012: Baht 5,782 million), on which deferred tax assets have not been recognised as the Company believes future taxable profits may not be sufficient to allow utilisation of the temporary differences and unused tax losses.

Annual Report 2013 Bangkok Metro Public Company Limited 161 22. Promotional privileges

The Company has received promotional privileges from the Board of Investment for the MRTA Initial System Project - Chaloem Ratchamongkhon Line (the blue line), pursuant to the promotion certificate No. 1029 (1)/2546 issued on 16 January 2003. Subject to certain imposed conditions, the main privileges include the following: a) Exemption from import duty on imported machinery that is imported in accordance with specified condition. b) Exemption from corporate income tax on net income from the promoted operations for a period of 8 years from the date the promoted operations commenced generating revenues (3 July 2004) and exemption from income tax on dividends paid from the profit of the operations throughout the period in which the corporate income tax is exempted.

If losses are incurred during the corporate income tax exemption period, the Company is allowed to utilise the losses as a deduction against net income for up to five years after the expiry of the tax exemption period.

The Company’s operating revenues for the years are below shown divided according to promoted and non- promoted operations. (Unit: Thousand Baht) Separate financial statements Promoted operations Non-promoted operations Total 2013 2012 2013 2012 2013 2012 Revenues Fare box revenues 2,106,357 1,979,348 - - 2,106,357 1,979,348 Commercial development revenues - - 226,706 163,997 226,706 163,997 Other income - - 7,600 8,548 7,600 8,548 Total revenues 2,106,357 1,979,348 234,306 172,545 2,340,663 2,151,893

23. Loss per share Basic loss per share is calculated by dividing loss for the year attributable to equity holders of the Company (excluding other comprehensive income) by the weighted average number of ordinary shares in issue during the year.

Annual Report 2013 162 Bangkok Metro Public Company Limited 24. Segment information Operating segment information is reported in a manner consistent with the reports that are regularly reviewed by the chief operating decision maker in order to make decisions about the allocation of resources to the segment and assets its performance. Revenue and profit information the segment of the Company and its subsidiary for the year ended 31 December 2013 and 2012 is as follows: (Unit: Million Baht) Consolidated financial statements for the years ended 31 December The MRTA Initial System Commercial development Other Total Elimination of inter-segment Project segment business segment 1) segments Segment revenues Consolidation 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 (restated) Revenue from external customers 2,106 1,979 422 291 9 11 2,537 2,281 - - 2,537 2,281 Inter-segment revenues - - 196 134 - - 196 134 (196) (134) - - Total revenues 2,106 1,979 618 425 9 11 2,733 2,415 (196) (134) 2,537 2,281 Segment income 455 298 183 90 9 11 647 399 - - 647 399 Unallocated expenses: Selling expenses (12) (12) Administrative expenses (169) (182) Finance cost (1,229) (1,186) Tax income (expense) (2) 2 Non-controlling interests of the subsidiary (9) - Loss for the year (774) (979) (Unit: Million Baht) Consolidated financial statements as at 31 December

Bangkok Metro Public CompanyLimited The MRTA Initial System Commercial development Project segment business segment 1) Total Elimination Consolidation 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 (restated) Project costs 16,559 16,891 996 997 17,555 17,888 - - 17,555 17,888

Annual Report 2013 Equipment 16 13 3 1 19 14 - - 19 14 Unallocated assets 2,785 416 Total assets 20,359 18,318

Transfer prices between business segments are as set out in Note 6 to the financial statements.

163 1) The Commercial development business segment includes the rental of retail space, and the provision of advertising media services and telecommunication services in underground train stations. 25. Provident fund Future minimum maintenance fees payable under these contracts are as follows: (Unit: Million Baht) The Company, its subsidiary and employees have participated in TISCO Ruamtun 2 Registered Provident Fund As at 31 December as approved by Ministry of Finance in accordance with the Provident Fund Act B.E. 2530. Employees, the 2013 2012 Company and its subsidiary contributed to the fund monthly at the rates of 3-5 percent of basic salary. The Payable within: fund, which is managed by TISCO Asset Management Company Limited, will be paid to employees upon Less than 1 year 98 102 termination in accordance with the fund rules. During the year 2013, the Company and its subsidiary contributed In over 1 year and up to 5 years 417 492 Baht 15 million (Separate financial statements: Baht 14 million) to the fund (2012: Baht 15 million, Separate More than 5 years - 23 financial statements: Baht 14 million). 26.4 Commitments under various service agreements The Company and its subsidiary have commitments under various service agreements. Future minimum service 26. Commitments and contingent liabilities fees payable are as follows: (Unit: Million Baht) 26.1 Capital commitments As at 31 December As at 31 December 2012, the subsidiary had capital commitments of approximately Baht 15 million, relating to 2013 2012 purchase and installs the telecommunication equipment. Payable within: Less than 1 year 20 65 26.2 Long-term service commitments In over 1 year and up to 5 years 20 27 The Company has commitments in respect of the Procurement of M&E equipment and Maintenance of M&E equipment and trackwork contracts for the MRTA Initial System Project - Chaloem Ratchamongkhon Line with 26.5 Operating lease commitment two companies, dated 19 December 2001, and five supplemental agreements dated from 3 July 2007 to 30 The Company and its subsidiary had entered into several lease agreements in respect of the lease of office September 2013. These contracts will expire in 2024. In addition, the Company has commitments in respect of building space, equipment and motor vehicles. The terms of the agreements are generally between 2 and 5 the M&E Systems and trackwork contract for the MRT Purple Line Project, dated 1 November 2013. This years. Operating lease agreements are non-cancellable. contract has a term of 10 years from the date specified in the commencement as notified in writing by the Company in the Notice to Proceed. Future minimum lease payments required under these non-cancellable operating lease contracts were as follows: (Unit: Million Baht) Future minimum service fees payable under these contracts, excluding escalation in accordance with the general As at 31 December consumer price index are as follows: 2013 2012 (Unit: million) Payable within: As at 31 December Less than 1 year 12 8 The MRTA Initial System Project - In over 1 year and up to 5 years 18 16 Chaloem Ratchamongkhon Line The MRT Purple Line Project 26.6 Remuneration agreement commitments with related company 2013 2012 2013 Baht EUR Baht EUR Baht EUR SGD YEN The subsidiary has entered into a remuneration agreement with a related company, granting rights to use space Payable within: in a building connected to the MRT system at Sukhumvit station, for the purpose of installing advertising billboards, under an agreement expiring in 2014. Less than 1 year 225 2 244 3 - - - - In over 1 year and up to 5 years 1,395 11 155 2 378 1 3 759 The subsidiary has agreed to pay remuneration to the related company in the form of monthly payments at a In over 5 years 1,840 14 - - 1,512 1 10 3,036 rate of approximately Baht 0.2 million per month (2012: approximately Baht 0.2 million per month). 26.3 Commitments under contracts to repair and maintain of infrastructure and civil works of the MRTA Initial System Project

The Company has commitments under 2 contracts with the two companies to repair and maintain infrastructure and civil works of the MRTA Initial System Project - Chaloem Ratchamongkhon Line, dated 6 November 2003 and dated 31 May 2010, with two additional contracts dated 1 March 2007 and 17 February 2010. These contracts will expire in 2018.

Annual Report 2013 164 Bangkok Metro Public Company Limited Future minimum maintenance fees payable under these contracts are as follows: (Unit: Million Baht) As at 31 December 2013 2012 Payable within: Less than 1 year 98 102 In over 1 year and up to 5 years 417 492 More than 5 years - 23

26.4 Commitments under various service agreements The Company and its subsidiary have commitments under various service agreements. Future minimum service fees payable are as follows: (Unit: Million Baht) As at 31 December 2013 2012 Payable within: Less than 1 year 20 65 In over 1 year and up to 5 years 20 27

26.5 Operating lease commitment The Company and its subsidiary had entered into several lease agreements in respect of the lease of office building space, equipment and motor vehicles. The terms of the agreements are generally between 2 and 5 years. Operating lease agreements are non-cancellable.

Future minimum lease payments required under these non-cancellable operating lease contracts were as follows: (Unit: Million Baht) As at 31 December 2013 2012 Payable within: Less than 1 year 12 8 In over 1 year and up to 5 years 18 16

26.6 Remuneration agreement commitments with related company The subsidiary has entered into a remuneration agreement with a related company, granting rights to use space in a building connected to the MRT system at Sukhumvit station, for the purpose of installing advertising billboards, under an agreement expiring in 2014.

The subsidiary has agreed to pay remuneration to the related company in the form of monthly payments at a rate of approximately Baht 0.2 million per month (2012: approximately Baht 0.2 million per month).

Annual Report 2013 Bangkok Metro Public Company Limited 165 26.7 Guarantees There were the following outstanding performance bonds and bank guarantees issued by banks on behalf of the Company. (Unit: Million Baht) 31 December 31 December 2013 2012 - Issued to the MRTA required under the operation of the MRTA Initial System Project - Chaloem Ratchamongkhon Line 150 150 - Issued to the Metropolitan Electricity Authority 36 36 - Issued to the MRTA as part of the proposal to invest in the Supply of - 200 M&E systems and O&M services for the MRT Purple Line Project - Issued to the MRTA in accordance with phase I of the Agreement for 700 - the MRT Purple Line Project, using the credit line of a related party

27. Financial instruments

27.1 Financial risk management The financial instruments of the Company and its subsidiary, as defined under Thai Accounting Standard No. 107 “Financial Instruments: Disclosure and Presentations”, principally comprise cash and cash equivalents, trade and other receivables, bank overdraft, construction payables and other payables, construction payable to related party, long-term loans from financial institutions and long-term loans from shareholder and accrued interest. The financial risks associated with these financial instruments and how they are managed is described below.

Credit risk The Company and its subsidiary are exposed to credit risk primarily with respect to trade and other receivables. The Company and its subsidiary manage the risk by adopting appropriate credit control policies and procedures and therefore do not expect to incur material financial losses. In addition, the Company and its subsidiary do not have high concentrations of credit risk since they have a large customer base. The maximum exposure to credit risk is limited to the carrying amounts of trade and other receivables as stated in the statements of financial position.

Interest rate risk The Company and its subsidiary are exposed to interest rate risk relate primarily to their cash at banks, bank overdraft and long-term borrowings. However, since most the financial assets and liabilities of the Company and its subsidiary bear floating interest rates or fixed interest rates which are close to the market rate, the interest rate risk is expected to be minimal.

Significant financial assets and liabilities classified by type of interest rate are summarised in the table below, with those financial assets and liabilities that carry fixed interest rates further classified based on the maturity date, or the repricing date if this occurs before the maturity date.

Annual Report 2013 166 Bangkok Metro Public Company Limited (Unit: Million Baht) As at 31 December Consolidated financial statements Fixed interest rates within Floating interest Non-interest 1 year rate bearing Total Effective interest rate 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 (% per annum) Financial assets Cash and cash equivalents - - 2,130 38 65 45 2,195 83 0.13, 0.50 0.13, 0.63 Trade and other receivables - - - - 83 61 83 61 - - - - 2,130 38 148 106 2,278 144 Financial liabilities Bank overdrafts - - - 6 - - - 6 - 7.38 Construction payables and other payables - - - - 525 540 525 540 - - Construction payable to related party - - 60 130 - - 60 130 8.25 8.38 Long-term loans from financial institutions and accrued interest - - 10,773 12,255 - - 10,773 12,255 7.00, 7.50 7.00, 7.50 Long-term loans from shareholder and accrued interest - - - 3,000 - 981 - 3,981 - 7.75 - - 10,833 15,391 525 1,521 11,358 16,912

(Unit: Million Baht) As at 31 December Separate financial statements Fixed interest rates within 1 Floating interest Non-interest year rate bearing Total Effective interest rate 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 (% per annum) Financial assets Cash and cash equivalents - - 2,121 35 64 45 2,185 80 0.13, 0.50 0.13, 0.63 Trade and other receivables - - - - 40 38 40 38 - - - - 2,121 35 104 83 2,225 118 Financial liabilities Construction payables and other payables - - - - 495 516 495 516 - - Long-term loans from financial institutions and accrued interest - - 10,603 12,155 - - 10,603 12,155 7.50 7.50 Long-term loans from shareholder - - - 3,000 - 981 - 3,981 - 7.75 and accrued interest - - 10,603 15,155 495 1,497 11,098 16,652

Annual Report 2013 Bangkok Metro Public Company Limited 167 Foreign currency risk The Company has a significant foreign currency risk in respect of construction payable. As at 31 December 2013, the Company has outstanding financial liabilities denominated in euro amounting to EUR 2 million (2012: EUR 2 million) which have not yet been hedged against foreign exchange risk (the majority of these liabilities are repayable within 1 year)

27.2 Fair values of financial instruments Since the majority of the financial instruments of the Company and its subsidiary are short-term in nature or bear floating interest rates, their fair value is not expected to be materially different from the amounts presented in statements of financial position.

A fair value is the amount for which an asset can be exchanged or a liability settled between knowledgeable, willing parties in an arm’s length transaction. The fair value is determined by reference to the market price of the financial instrument or by using an appropriate valuation technique, depending on the nature of the instrument.

28. Capital management The primary objective of the capital management of the Company and its subsidiary is to ensure that they have appropriate capital structure in order to support their business and maximise shareholder value. As at 31 December 2013, the Group's debt-to-equity ratio was 1:1 (2012: 18:1) and the Company's was 1:1 (2012: 17:1).

29. Approval of financial statements These financial statements were authorised for issue by the Company’s Board of Directors on 25 February 2014.

Annual Report 2013 168 Bangkok Metro Public Company Limited ANNUAL REPORT 2013 BANGKOK METRO PUBLIC COMPANY LIMITED

STEPPING STONE FOR A BETTER FUTURE

189 Rama IX Road, Huai Khwang, Bangkok 10310, Thailand Tel. + 66 (0) 2354-2000 Fax. + 66 (0) 2354-2040 www.bangkokmetro.co.th ANNUAL REPORT 2013 ANNUAL REPORT 2013