information memorandum – banpu power public company ......as of september 2016, the compnay has a...

1

– Information Memorandum –

Banpu Power Public Company Limited (the “Company” or“BPP”)

Head Office 26th Floor, Thanapoon Tower, 1550 New Petchburi Road,

Makkasan Sub-district, Ratchathewi District,

Bangkok 10400 Thailand

Telephone: (662) 007 6000 Fax: (662) 007 6060

Website: www.banpupower.com

Factory Location ". BLCP Power Plant

I-8 Road, Map Ta Phut Industrial Estate, Map Ta Phut Sub-district, Muang

District, Rayong 21150 Thailand

Telephone:(038) 925 100

$. Hongsa Power Plant

Supanuwong Road, Sitano Village, Sikhottabong Sub-district,

Vientiane Laos

Telephone: (8650) 21222 483

'. Zhengding CHP Plant

North Baiguan, Zhengding County, Shijiazhuang City,

Hebei Province, China 050800

Telephone: (86311) 85176918

). Luannan CHP Plant

West Gujianying Village, Bensi Road, Luanna County, Tangshan City,

Hubei Province, China 063500

Telephone: (86315) 4168274

*. Zouping CHP Plant

Xiwang Industrial Estate, Handian Town, Zouping County, Binzhou City,

Shandong Province, China 256209

Telephone: (86543) 4615655

6. ShanxiLu Guang Power Plant

Songcunxiang, Changzhi City, Shanxi Province, China

Telephone: (86355) 8580511

/. Huineng Project

No.19, Dabugou Village, Wushan Town, Anqiu City,

Weifang City, Shandong Province, China262100

Telephone:N/A

2

8. Jinshan Project

No. 16, Shengli Road, Anqiu City, Weifang City, Shandong Province,

China 262100

Telephone:N/A

Listing Date October 28, BCDE (The first trading day is on October 28, BCDE)

Listing Securities 3,095,692,000 ordinary shares, with the par value per share of THB 10,

totaling to THB 30,956,920,000

The offering of newly issued ordinary shares comprises of the

followings:

(1) 195,072,871 shares to specific group of the public who existing

shareholders of Banpu Public Company Limited (“Banpu”) and

entitled to the allocation of shares (hereinafter referred as the

“Eligible Existing Banpu Shareholders”) and

(2) HIJ,HDK,EBK shares shall be offered to general public

Capital October 28, BCDE (The first trading day is on October 28, BCDE)

Registered Capital Ordinary shares THB 30,956,920,000

Paid-up Capital Ordinary shares THB 30,456,920,000

Note: 1/

The Company has newly issued shares, which have not issued and

offered, of not exceeding IC,CCC,CCC shares reserved for the

exercise of Warrants to be issued to directorsand employees of

Banpu Group (excluding directors, management and employees of

BPP and its subsidiaries)

Secondary Market The Stock Exchange of Thailand (“SET”)

Offering Price THB 21 per share

Offering Date Offering to the Eligible Existing Banpu Shareholders on October 10 – 13,

2016

Offering to retail investors and institutional investors (including foreign

investors and cornerstone investors subscribed through initial purchasers)

on October 18 – 20, 2016

3

Use of Proceeds

Estimated Proceeds

(THB Million)

Estimated Period

for Use of

Proceeds

1. Loans repayment 10,047 - 11,964 By 2016

2. Domestic and international business expansion 1,000 Within 2017

3. Working capital 300 Within 2017

Green Shoe Option (if any)

- None -

Business

The Company is a multinational holding company engaging in the generation and sales of electricity and other

related businesses. While the Company primarily derives profit from its interests in conventional power

generation assets at present, the Company has also expanded its portfolio of power generation assets to

renewable power projects. With a high-growth track record, the Company has been developing, operating and

investing in power generation assets for nearly 20 years. The Company has a diversified portfolio of

conventional and renewable power generation assets in Thailand, Laos, China and Japan.

1. Capacity

As of September 2016, the Compnay has a total equity installed capacity of B,HEE.B MWe, divided into D,KDJ.C

MWe in operation, which comprises D,NDD.B MW of coal power, ODJ.C tph of steam and IE.E MW of solar

power, and IIJ.B MWe under development, which comprises HJO.I MW of coal power, BII.C tph of steam and

EK.B MW of solar power. In addition, a total of KC.C MW of equity installed capacity, which comprises BC.C MW

and NC.C MW in operation and under development, respectively, is under the remaining solar power projects to

be acquired by the Company.

Plant/

project name Location

Plant/

project type

Installed

power/steam

generation capacity

Equity

participa-

tion

Equity installed

power/steam

generation

capacity

Commencement

of operations

In Operation

BLCP Power

Plant

Rayong

province,

Thailand

Coal-fired Coal power:

1,434.0 MW

50.00% Coal power:

717.0 MW

Unit 1:

October 2006

Unit 2:

February 2007

Hongsa Power

Plant

Hongsa

district,

Xayaboury

province,

Laos

Mine-mouth,

lignite-fired

Coal power:

1,878.0 MW

40.00% Coal power:

751.2 MW

Unit 1:

June 2015

Unit 2:

November 2015

4

Plant/


Plant/

project type

Installed

power/steam

generation capacity

Equity

participa-

tion

Equity installed

power/steam

generation

capacity

Commencement

of operations

Unit 3:

March 2016

Zhengding CHP

Plant

Zhengding

county,

Shijiazhuang,

Hebei

province,

China

Coal-fired

cogeneratio

n

Coal power:

73.0 MW

Steam:

370.0 tph

Total:

139.1 MWe

100.00% Coal power:

73.0 MW

Steam:

370.0 tph

Total:

139.1MWe

Phase 1:

October 2000

Phase 2:

November 2005

Phase 3:

January 2015

Luannan CHP

Plant

(Phase 1)

Luannan

county,

Tangshan,

Hebei

province,

China

Coal-fired

cogeneratio

n

Coal power:

100.0 MW

Steam:

128.0 tph

Total:

122.9 MWe

100.00% Coal power:

100.0MW

Steam:

128.0 tph

Total:

122.9 MWe

June 2001

Zouping CHP

Plant

(Phases 1 -3)

Zouping

county,

Binzhou,

Shandong

province,

China

Coal-fired

cogeneratio

n

Coal power:

100.0 MW

Steam:

450.0 tph

Total:

180.4 MWe

70.00% Coal power:

70.0 MW

Steam:

315.0 tph

Total:

126.3 MWe

Phase 1:

June 2001

Phase 2:

October 2006

Phase 3:

December 2007

Huineng Project

(Phases 1 and

2)

Weifang,

Shandong

province,

China

Solar Solar power:

20.0 MW(1)

100.00% Solar power:

20.0 MW

Phase 1

April 2016

Phase 2

June 2016

Jinshan Project Weifang,

Shandong

province,

China

Solar Solar power:

30.0 MW(1)


30.0 MW

April 2016

5

Plant/


Plant/

project type

Installed

power/steam

generation capacity

Equity

participa-

tion

Equity installed

power/steam

generation

capacity

Commencement

of operations

Project Olympia

(Hitachi Omiya

1, Hitachi

Omiya 2,

Ozenosato

Katashina,

Sakura 1,

Sakura 2)

Gunma,

Ibaraki and

Tochigi

prefectures,

Japan

Solar Solar power:

10.0 MW(2)

40.00% (3)

Solar power:

4.0 MW

Hitachi

Omiya 1:

July 2013

Hitachi

Omiya 2:

January 2015

Ozenosato

Katashina:

January 2015

Sakura 1:

December 2015

Sakura 2:

October 2015

Project Hino Shiga

prefecture,

Japan

Solar Solar power:

3.5 MW(2)

75.00%(3)

Solar power:

2.6 MW

May 2016

Total equity capacity

Coal power:

1,711.2 MW

Steam:

813.0 tph

Solar power:

56.6 MW

Total:

1,913.0 MWe

Under Development

Luannan CHP

Plant

(Phase 2)(4)

Luannan

county,

Tangshan,

Hebei

province,

China

Coal-fired

cogeneratio

n

Coal power:

25.0 MW

Steam:

150.0 tph

Total:

51.8 MWe

100% Coal power:

25.0 MW

Steam:

150.0 tph

Total:

51.8 MWe

2019 (expected)

Zouping CHP

Plant

(Phase 4)(4)

Zouping

county,

Binzhou,

Coal-fired

cogeneratio

n

Coal power:

25.0 MW

Steam:

70.00% Coal power:

17.5 MW

Steam:

2020 (expected)

6

Plant/


Plant/

project type

Installed

power/steam

generation capacity

Equity

participa-

tion

Equity installed

power/steam

generation

capacity

Commencement

of operations

Shandong

province,

China

150.0 tph

Total:

51.8 MWe

105.0 tph

Total:

36.3 MWe

Shanxi Lu

Guang Power

Plant

Shanxi, China Coal-fired

Ultra-

supercritical

Coal power:

1,320.0 MW

30.00% Coal power:

396.0 MW

Unit 1:

First half of 201 8

(expected)

Unit 2:

First half of 201 8

(expected)

Project Mukawa

Hokkaido

prefecture,

Japan

Solar Solar power:

17.0 MW(2)

55.80%(3)

Solar power:

9.5 MW

May 2018

(expected)

Project

Nari Aizu

Fukushima

prefecture,

Japan

Solar Solar power:

20.0 MW(2)

75.00%(3)

Solar power:

15.0 MW

January 2018

(expected)

Project

Awaji

Hyogo

prefecture,

Japan

Solar Solar power:

8.0 MW(2)

75.00%(3)

Solar power:

6.0 MW

April 2017

(expected)

Project Yabuki Fukushima

prefecture,

Japan

Solar Solar power:

7.0 MW(2)

75.00%(3)

Solar power:

5.3 MW

August 2018

(expected)

Project

Onami

Fukushima

prefecture,

Japan

Solar Solar power:

16.0 MW(2)

75.00%(3)

Solar power:

12.0 MW

January 2018

(expected)

Project

Yamagata

Yamagata

prefecture,

Japan

Solar Solar power:

20.0 MW(2)

100.00%(5)

Solar power:

20.0 MW

First quarter of

2018

(expected)

Rooftop Solar

Project

Thailand Solar Solar power:

1.5 MW(6)


1.5 MW

Various (through

December 31,

2016)

(expected)

Total equity capacity (4)

Coal power:

438.5 MW

Steam:

255.0 tph

Solar power:

7

Plant/


Plant/

project type

Installed

power/steam

generation capacity

Equity

participa-

tion

Equity installed

power/steam

generation

capacity

Commencement

of operations

69.2 MW

Total:

553.2 MWe

To be acquired(7)

Haoyuan

Project

Taian,

Shandong

province,

China

Solar Solar power:

20.0 MW(1)


20.0 MW

June 2016

Huien Project Weifang,

Shandong

province,

China

Solar Solar power:

20.0 MW(1)


20.0 MW

December 2016

(expected)

Baiyudang Project Jinshan county,

Zhejiang

province, China

Solar Solar power:

50.0 MW(1)


50.0 MW

December 2016

(expected)

Total equity capacity (to be acquired) Coal power: -

Steam: -

Solar power:

90.0 MW

Total:

90.0 MWe

Notes: (1) Power produced by the Company’s solar power generation projects in China is in direct current.

(2) Power produced by the solar power generation projects in Japan is in alternating current.

(3) The Company’s interests in Project Olympia, Project Hino, Project Mukawa, Project Nari Aizu, Project Awaji,

Project Yabuki and Project Onami are held under the TK structure.

(4) The Company is in the process of constructing the planned expansion of the Luannan CHP Plant and studying

the planned expansion of the Zouping CHP Plant.

(5) The Company has entered into an investment agreement for the investment in a 100.00% interest in Project

Yamagata in Yamagata prefecture, Japan and is in the process of establishing the TK structure for the project.

(6) Power produced by the Solar Rooftop Project is in direct current.

(7) The Company has entered into share purchase agreements for the acquisition of 100% equity stakes in the

Jinshan Project, the Huineng Project, the Haoyuan Project and the Huien Project. As of September 2016, the

Company has completed the acquisition of the Huineng Project. The remaining acquisitions have not been

completed, and the Company expects to complete such acquisitions by the end of 2016, subject to the

satisfaction of certain conditions precedent.

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2. Revenue Structure

For the years ended December '", For the six months ended June 'A,

2013 2014 2015 2015 2016

THB % THB % THB % THB % THB %

Sales (in thousands)

Power

Sales by Zhengding CHP Plant 652,310 8.1 680,717 8.5 812,262 10.0 394,713 10.0 375,517 7.5

Sales by Luannan CHP Plant 1,124,319 14.0 1,175,737 14.8 1,194,300 14.7 637,330 16.0 565,689 11.3

Sales by Zouping CHP Plant 1,380,975 17.2 1,157,9DJ 14.5 1,201,910 14.8 557,493 14.1 561,907 11.2

Total power sales 3,157,604 39.3 3,014,367 37.8 3,208,472 39.5 1,589,536 40.1 1,503,113 30.0

Steam

Sales by Zhengding CHP Plant 574,526 7.2 646,415 8.1 804,104 9.9 407,993 10.3 461,390 9.3

Sales by Luannan CHP Plant 331,922 4.1 377,274 4.7 399,258 4.9 191,564 4.8 256,460 5.1

Sales by Zouping CHP Plant 1,586,413 19.7 1,122,170 14.1 1,161,227 14.3 514,396 13.0 567,255 11.3

Total steam sales 2,492,861 31.0 2,145,859 26.9 2,364,589 29.1 1,113,953 28.1 1,285,105 25.7

Other sales 38,624 0.5 39,450 0.5 79,951 1.0 24,278 0.6 26,183 0.5

Total sales 5,689,089 70.8 5,199,676 65.2 5,653,012 69.6 2,727,767 68.8 2,814,401 56.2

Management and other income(1)

534,610 6.6 626,428 7.8 564,010 7.0 311,790 7.9 358,590 7.2

Total Revenue 6,223,699 77.4 5,826,104 73.0 6,217,022 76.6 3,039,557 76.7 3,172,991 63.4

Profit (loss) from joint ventures

BLCP 2,256,067 28.0 2,273,929 28.5 2,094,612 25.8 1,161,102 29.1 1,410,561 28.2

Hongsa(2)

(436,540) (5.4) (114,524) (1.5) (203,326) (2.4) (224,932) (5.9) 505,455 10.1

Phu Fai Mining(3)

(75) 0.0 (74) 0.0 25,395 0.3 3,073 0.1 45,386 0.9

Shanxi Lu Guang(4)

— — — 0.0 (10,216) 0.0 (4,275) 0.0 (1) 0.0

Akira Energy(5) (6)

— — (706) 0.0 (6,956) 0.0 (6,956) 0.0 — 0.0

Aizu Energy(5)

— — (172) 0.0 (4,319) 0.0 (2,452) 0.0 (128,318) (2.6)

Share of profit from joint ventures 1,819,452 22.6 2,158,453 27.0 1,895,190 23.4 925,560 23.3 1,833,083 36.6

Total revenue and share of profit

from joint ventures 8,043,151 100.0 7,984,557 100.0 8,112,212 100.0 3,965,117 100.0 5,006,074 100.0

Notes : (1) Management and other income mainly consist of dividend income, management income, interest income, etc.

(B) Hongsa owns the Hongsa Power Plant which commenced the commercial operations of unit 1, unit 2 and unit 3

in June 2015, November 2015 and March 2016, respectively. Therefore, Hongsa did not record share of profit

during the year ended December 31, 2013 to the year ended December 31, 2014. However, the Company

realized share of loss from Hongsa mainly due to the increased level of finance costs, the depreciation of the

Thai Baht against the U.S. dollar and the loss from foreign exchange translation on its U.S. dollar-denominated

net borrowings.

(J) Phu Fai Mining has obtained the concession for the Hongsa Lignite Mine which is a captive lignite mine that

supplies lignite to the Hongsa Power Plant and has assigned its right to operate the Hongsa Lignite Mine to

Hongsa. Phu Fai Mining does not have material income.

(4) The Shanxi Lu Guang Power is under construction, resulting in share of loss for the six months ended June 30,

2016.

(5) Akira Energy and Aizu Energy’s investment in solar power generation projects in Japan is not fully operational;

therefore, the companies did not record share of profit during the year ended December 31, 2013 to the year

ended December 31, 2014.

(6) As the Company acquired the remaining HC.CC% equity interest in Akira Energy from an independent third party

in June BCDI, Akira Energy has been re-classified as the Company’s subsidiary since June JC, BCDI. As such,

the Company’s share of profit/loss from Akira Energy after June JC, BCDI does not constitute share of profit/loss

from joint venture and is not accounted for in this table.

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3. Power Generation and Sales Business

1) The BLCP Power Plant

The Company, through its subsidiary, owns a 50.00% interest in BLCP, which operates a coal-fired

power plant, the BLCP Power Plant, with an installed power generation capacity of 1,434.0 MW and

has secured a long-term power purchase agreement, the BLCP PPA, with EGAT for 25 years from the

commencement of commercial operations of the second unit of BLCP Power Plant in February 2007

until February 2032. The BLCP Power Plant is situated in the Map Ta Phut Industrial Estate, Rayong

province under a 30-year lease agreement with the IEAT expiring in October 2030, and BLCP expects

to further renew the lease agreement with the IEAT until expiration of the BLCP PPA.

The BLCP Power Plant uses coal in the generation of power. To procure coal for its operations, BLCP

has entered into a 25-year coal supply agreement with ACH, which is a subsidiary of Rio Tinto Ltd.,

one of the world’s leading mining companies that focuses on exploring, mining and processing mineral

resources, including coal. The coal supply agreement will expire in February 2032. The term of the

coal supply agreement may be extended in accordance with any extension of the term of the BLCP

PPA.

2) The Hongsa Power Plant

The Company owns a HC.CC% interest in Hongsa Power Co., Ltd., which operates a mine-mouth

lignite-fired power plant, the Hongsa Power Plant, in Hongsa district, Xayaboury province. The Hongsa

Power Plant has an installed power generation capacity of D,ONO.C MW. Hongsa has secured a long-

term power purchase agreement with each of EGAT and EDL for BI years until March BCHD.

Hongsa obtained the concession for the exclusive rights to develop, construct and operate the Hongsa

Power Plant from the Lao government in November 2009. The concession rights are effective from

November 2009 to March 2041, which is 25 years after the commencement of commercial operations

of Hongsa Unit 3 in March 2016. The concession includes, among others, the right to use the 77.79

sq.km. project site and the right to use the nearby dams during the concession period and the rights to

sell the power generated from the Hongsa Power Plant to EGAT and EDL.

3) Zhengding Combined Heat and Power Plant

The Company owns a 100.00% indirect interest in Shijiazhuang Chengfeng Cogen Co., Ltd.

(“Shijiazhuang Chengfeng”), which operates a coal-fired cogeneration power plant with an installed

power generation capacity of 73.0 MW and steam generation capacity of 370.0 tph

Shijiazhuang Chengfeng has entered into an annual power purchase agreement with Hebei Electric

Power Company. The power tariff is a fixed tariff per kilowatt-hour of power determined by National

Development Reform Commission and is adjusted in accordance with the prevailing coal price.

Moreover, Shijiazhuang Chengfeng has entered into long-term steam purchase agreements to directly

sell heat to industrial enterprises in Zhengding country in the form of steam. In addition, Shijiazhuang

Chengfeng has entered into a long term agreement with the local government in Zhengding to be the

direct supplier of steam and hot water to end-users in Zhengding county.Shijiazhuang Chengfeng has

entered into agreements to supply steam and hot water to commercial and residential users during the

10

winter months for heating purposes and chilled water during the summer months for cooling purposes.

Prices shall be determined by the relevant provincial pricing bureau each year. Shijiazhuang

Chengfeng also sells chilled water during summer.

4) Luannan Combined Heat and Power Plant

The Company owns a 100.00% indirect interest in Tangshan Banpu Heat and Power Co. Ltd.

(“Tangshan Banpu”), which operates a coal-fired cogeneration power plant with an installed power

generation capacity of 100.0 MW and a steam generation capacity of 128.0 tph. The Company is in

the process of constructing the planned expansion of the Luannan CHP Plant. Upon completion of the

investment and construction of the expansion, the Luannan CHP Plant is expected to increase its

installed power generation capacity and steam generation capacity by BI.C MW and DIC.C tph,

respectively. The additional capacity is scheduled to be commercially available in BCDK.

Tangshan Banpu has entered into annual power purchase agreement with Tangshan Power Supply

Company of State Grid Jibei Electric Power, a subsidiary of North China Grid Company Ltd., a regional

state-owned power grid company in northeastern China. Tangshan Banpu has entered into long-term

steam purchase agreements to directly sell steam to industrial enterprises and commercial users.

In addition, Tangshan Banpu is the only supplier of steam in Luannan County from November to

March of each year for heating purposes. Prices shall be determined by the relevant provincial pricing

bureau each year. Tangshan Banpu sells steam to the local government which converts steam into hot

water before distributing hot water to commercial and residential users.

The Company believes Tangshan Banpu benefits from dispatch priority under the PRC government’s

policy.

5) Zouping Combined Heat and Power Plant

The Company owns a NC.CC% indirect interest in Zouping Peak CHP Co., Ltd., which operates a coal-

fired cogeneration power plant with an installed power generation capacity of DCC.C MW and a steam

generation capacity of HIC.C tph The Company is in the process of studying the planned expansion of

the Zouping CHP Plant. Upon completion of the investment and construction of the expansion, the

Zouping CHP Plant is expected to increase its installed power generation capacity and steam

generation capacity by BI.C MW and DIC.C tph, respectively. Phase H is scheduled to commence

commercial operations in BCBC.

Zouping Peak has a BO-year power purchase agreement and steam purchase agreement with Xiwang

for the sale of power and steam generated from the Zouping CHP Plant. Both agreements will expire

in June BCBK. Moreover, Zouping Peak is the exclusive steam supplier for Xiwang.

6) Shanxi Lu Guang Power Plant

The Company entered into an equity joint venture contract with Shanxi Lu’an Mining Corporation Ltd.

and Gemeng International Energy Co., Ltd. in September BCDH to establish a joint venture company,

Shanxi Lu Guang for the development of the Shanxi Lu Guang Power Plant, which is a two-unit coal-

fired ultra-supercritical power plant with an expected installed power generation capacity of D,JBC.C

11

MW, located in Changzhi City, Shanxi province, China. The two power generation units of the Shanxi

Lu Guang Power Plant Project are expected to commence commercial operations in the first half of

BCDO. Once operational, the Shanxi Lu Guang Power Plant Project will supply power to Hubei

province.

7) Solar Power Generation Projects in China

Between March and May BCDE, the Company, through its subsidiary BPP Renewable Investment

(China) Co., Ltd., entered into share purchase agreements with independent third parties for the

acquisition of DCC.CC% equity stakes in 4 solar power projects in China, namely, the Jinshan Project,

the Huineng Project, the Haoyuan Project and the Huien Project. The Company completed the

acquisitions of the Huineng Project and the Jinshan Project in July BCDE and September BCDE,

respectively.

In addition, in September BCDE, the Company, through the Company’s subsidiary Banpu Renewable

Energy Co., Ltd., entered into a share purchase agreement with independent third parties for the

acquisition of a DCC.CC% equity interest in Baiyudang Project. The Baiyudang Project is a IC.C MW

solar power project located in Jiashan county, Zhejiang province, China.

The remaining acquisitions have not been completed, and the Company expect to complete such

acquisitions by the end of BCDE, subject to the satisfaction of certain conditions precedent, including

but not only limited to obtaining licenses and approvals for power generation from relevant authorities

and entering into agreements relating to operation of the project, such as power purchase agreements

and land lease agreements.

The Jinshan Project is a JC.C MW solar power project located in Weifang, Shandong province, China.

The Jinshan Project began commercial operations in April BCDE. The Jinshan Project is situated on a

D,JJJ,JJJ sq.m. site owned by the local village committee. The BC-year lease agreement with the local

village committee will expire in December BCJH. The project company and the local village committee

have further agreed to enter into a lease agreement for an additional DC-year period after the initial

lease agreement expires.

The Huineng Project is a BC.C MW solar power project located in Weifang, Shandong province, China.

The Huineng Project consists of two phases, the Huineng Project D and the Huineng Project B, and is

situated on a HBJ,JJJ sq.m. site owned by the local village committee. The Huineng Project D is a DC.C

MW project that began commercial operations in April BCDE. The Huineng Project B is a DC.C MW

project that began commence commercial operations in June BCDE. The BC-year lease agreement with

the local village committee will expire in May BCJI. The project company and the local village

committee have further agreed to enter into lease agreements for an additional DC-year period after the

initial lease agreements expire.

The Haoyuan Project is a 20.0 MW solar power project located in Taian, Shandong province, China

that began commercial operations in June 2016. The project is situated on a 400,000 sq.m. site owned

by the local village committee. The 20-year lease agreement with the local village committee will expire

in June 203. The project company and the local village committee have further agreed to enter into a

lease agreement for an additional 10-year period after the initial lease agreement expires.

12

The Huien Project is a BC.C MW solar power project located in Weifang, Shandong province, China.

The Huien Project was commissioned in September BCDI and is expected to commence commercial

operations by December BCDE. The project is situated on a EEE,EEN sq.m. site owned by the local

village committee. The BC-year lease agreement with the local village committee will expire in February

BCJE. The project company and the local village committee have further agreed to enter into a lease

agreement for an additional DC-year period after the initial lease agreement expires.

The Baiyudang Project is a IC.C MW solar power project located in Jiashan county, Zhejiang province,

China. The Baiyudang Project was commissioned in February BCDI and is expected to commence

commercial operations by December BCDE. The project is situated on a site owned by the local village

committee. The BI-year lease agreement with the local village committee will expire in December

BCIC.

8) Investment in Solar Power Generation Projects in Japan

The Company currently holds interests in 7 solar power projects in Japan, Project Olympia, Project

Hino, Project Mukawa, Project Nari Aizu, Project Awaji, Project Yabuki and Project Onami, through the

TK structure, and are in the process of establishing the TK structure for Project Yamagata.

The TK structure is governed by a contract between investors and a business operator under which

the investors make certain contributions to the business operator (in the form of cash or other things of

value) in return for the right to receive distributions of profits generated from the partnership’s

business. Under Japanese law, neither the TK investor nor its officers, directors, employees or

representatives actively manage and operate the TK business, nor do they have any authority to act

for the TK operator.

The Company holds a HC.CC% interest in Project Olympia, which is a solar power generation project

with a total power generation capacity of DC.C MW located in Gunma, Tochigi and Ibaraki prefectures,

Japan. Project Olympia comprises five phases, Hitachi Omiya D, Hitachi Omiya B, Ozenosato

Katashina, Sakura D and Sakura B, each with an installed power generation capacity of B.C MW.

Hitachi Omiya D, Hitachi Omiya B, Ozenosato Katashina, Sakura D and Sakura B commenced

commercial operations in July BCDJ, January BCDI, January BCDI, December BCDI and October BCDI,

respectively. The TK operator of Project Olympia has appointed Octave Japan Co. Ltd. as the asset

manager of the project. Octave Japan Co., Ltd. is an asset management firm that specializes in real

asset management.

The Company holds a NI.CC% interest in Project Hino, which is a solar power generation project with

an installed power generation capacity of J.I MW located in Shiga prefecture, Japan. Project Hino

commenced commercial operations in May BCDE. The TK operator of Project Hino has appointed

Vector Cuatro Co., Ltd. as the asset manager of the project. Vector Cuatro Co., Ltd. is an asset

management firm that specializes in solar power plant development and management.

Project Mukawa is currently under development. The Company holds a II.OC% interest in Project

Mukawa, which is a solar power generation project with an expected installed power generation

capacity of DN.C MW located in Mukawa, Hokkaido prefecture, Japan. Project Mukawa is expected to

commence commercial operations in May BCDO.

13

Project Nari Aizu is currently under development. The Company holds a NI.CC% interest in Project Nari

Aizu, which is a solar power generation project with an expected installed power generation capacity of

BC.C MW located in Aizu city in Fukushima prefecture, Japan. Project Nari Aizu is expected to

commence commercial operations in January BCDO. The TK operator of Project Nari Aizu is in the

process of selecting an asset manager for the project.

Project Awaji is currently under development. The Company holds a NI.CC% interest in Project Awaji,

which is a solar power generation project with an expected installed power generation capacity of

O.CMW located in Awaji City in Hyogo prefecture, Japan. Project Awaji is expected to commence

commercial operations in April BCDN.

Project Yabuki is currently under development. The Company holds a NI.CC% interest in Project

Yabuki, which is a solar power generation project with an expected installed power generation capacity

of N.C MW located in Fukushima prefecture, Japan. Project Yabuki is expected to commence

commercial operations in August BCDO.

Project Onami is currently under development. The Company holds a NI.CC% interest in Project

Onami, which is a solar power generation project with an expected installed power generation capacity

of DE.C MW located in Fukushima prefecture, Japan. Project Onami is expected to commence

commercial operations in January BCDO.

In March BCDE, the Company, through the Company’s subsidiary Banpu Renewable Singapore Pte.

Limited, enteredinto an equity interests purchase agreement for the acquisition of a DCC.CC% interest in

Project Yamagata in Yamagata prefecture, Japan, which is a solar power generation project with an

installed power generation capacity of BC.C MW. The Company is in the process of establishing the TK

structure for the project. Project Yamagata is scheduled to commence commercial operations in the

first quarter of BCDO.

9) Solar Rooftop Power Generation Company in Thailand

In May BCDE, the Company, through Banpu Renewable Energy, entered into a share purchase

agreement with an independent third party for the acquisition of Thai Solar Consultant, a solar rooftop

power generation company in Thailand. Thai Solar Consultant has entered into a total of JNK power

purchase agreements with the Provincial Electricity Authority and the Metropolitan Electricity Authority

in relation to the Rooftop Solar Project for the installation of rooftop solar power generation systems on

the roof of up to JNK buildings in Thailand. The power purchase agreements have a duration of BI

years with a feed-in-tariff of THBE.OI per kWh.

As of Semtember 2016, Thai Solar Consultant is in the process of extending the commercial

operations date from June JC, BCDE pursuant to the terms of the respective power purchase

agreements with the Provincial Electricity Authority and the Metropolitan Electricity Authority, and the

extension is under consideration by the relevant authorities. The Rooftop Solar Project has an

expected aggregate installed power generation capacity of approximately D.I MW, subject to the

approval of the relevant authorities. The Company expects to complete to fully commence the Rooftop

Solar Project’s commercial operations by December BCDE.

14

4. Competition

a) Thailand and Laos

BLCP and Hongsa do not currently face competition in relation to contracted power generation capacity sales in

Thailand and Laos as these are contracted under long-term power purchase agreements with contract terms

ranging from 20 to 25 years. There may, however, be competition for future power generation projects as and

when they arise. If and when this happens, BLCP and Hongsa may face competition with other major global

and regional power generation companies. The Company expects that the ability of BLCP and Hongsa to

compete successfully will depend on their track record in meeting each project’s technical requirements and the

requirements under the power purchase agreements. In addition, where BLCP and Hongsa decide to

participate in the bidding for new projects, the Company expect that they may face significant competition.

b) China

(1) CHP Generation

Although the Zhengding CHP Plant and the Luannan CHP Plant do not have long-term power purchase

arrangements, the Company does not currently face direct competition from other producers in China as the

Company believes that it benefits from the PRC government’s priority power dispatch policies for CHP plants.

In addition, the Zhengding CHP Plant is the only steam and hot water supplier in Zhengding country, and the

Luannan CHP Plant is the only steam supplier in Luannan country. Zouping CHP Plant is also the exclusive

steam supplier for Xiwang. The Company believes these preferential treatments represent the Company’s

competitive advantages in China.

(2) Solar Power Generation

Solar power generation projects in China benefit from a range of supportive measures from the PRC

government. In 2005, China introduced the Renewable Energy Law, which has become the framework for the

development of the renewable energy industry in the country. The law offers a range of financial incentives to

encourage renewable energy development, such as a national fund, discounts in loans, and preferential

taxation for renewable energy projects, including solar power generation projects generally.

These incentives have encouraged growth in solar power generation in China. As of BCDH, the total

installed capacity of solar power generation in China was BE,IBC.C MW. Although the solar power generation

industry in China has historically been dominated by the large state-owned IPPs, constituting eight of the DC

largest solar power generation operators by installed capacity, there has been an increase in participation from

the private sector, typically in smaller capacity levels. Nonetheless, there has been an increasing trend whereby

private investors with strong financial positions invest in large size solar power generation projects. The

Company does not believe its solar power projects in China face competition in relation to contracted power

generation capacity as the local grid companies are expected to offtake all of the such projects’ power output.

c) Japan

The market for independent solar power producers in Japan is served by a few large solar power projects and

about 10 to 15 small scale solar power producers. In 2014, independent solar power producers accounted for

492.0 MW, or 2.1%, of the total 23,300.0 MW solar power capacity in Japan. As the Japanese government

provides incentives to renewable energy power projects, the number of investors for renewable energy power

15

projects has increased and is expected to increase further. The Company does not believe the solar power

projects in which the Company hold investment interests in Japan face competition in relation to contracted

power generation capacity as sales have been contracted at fixed price under the feed-in tariff system under

20-year long-term power purchase agreements.

5. Research and Development

In September 2016, the Company entered into a cooperation agreement with Techen Technologies (Thailand)

Co., Ltd. (“Techen”) under which the Company and Techen have agreed to maintain business and technical

cooperation for the joint development of future solar power projects in Thailand and other countries, as to be

further agreed by us and Techen.

In addition, the Company and Techen have entered into a separate memorandum of understanding with King

Mongkut’s Institute of Technology Ladrabang in relation to a pilot energy solutions management project to study

the use of solar power to reduce the energy costs of King Mongkut’s Institution and related research and

development cooperation efforts.

Environmental, Health and Safety Matters

The Company and its joint ventures place emphasis on minimizing the environmental impact of emissions from

the Company’s coal-fired plants, and the Company and its joint ventures continuously supervise, control and

improve the power generation process in order to ensure emissions are below stipulated maximum levels. The

projects in which the Company has an interest have been installed with various treatment and disposal

technologies, including low nitrogen oxide burners, flue gas desulfurization systems and the circulating fluidized

bed technology, which are used to reduce emissions of sulfur oxides and nitrogen oxides. In addition,

electrostatic precipitators have also been installed in the plants for trapping fly ash. Continuous emission

monitoring systems have also been installed in chimneys and in surrounding communities to ensure that

ambient air quality is within the levels required by law.

Each of the Company’s and its joint ventures’ plants has been fully in compliance, in all material respects, with

existing applicable environmental regulations and standards, and has been fully in compliance with World Bank

guidelines and local standards.

Summary of Material Agreements

1) The Company

1.1) Management Service Agreement: MSA

Parties (1) Banpu Public Company Limited (“Banpu”)

(2) The Company

Objective Banpu to provide the Company with management and advisory

services relating to (i) accounting and finance, (ii) internal audit, (iii)

legal, (iv) general administration, (v) information technology, (vi) human

resources and (vii) asset management, in order to support the

Company’s business efficiency.

16

1.1) Management Service Agreement: MSA

Effective date October 1, 2015 or any day as agreed by the Parties

Contract period Two years

Service fee THB108,000,000per annum (exclusive of VAT and other expenses)

paid on a monthly basis with the first monthly payment to be made

within seven days from the effective date and each subsequent

monthly payment to be made within seven days from the beginning of

each month.

Other Conditions (1) Conflict of interest

Banpu shall render the services in a manner that will not cause

any conflict of interest unless express written authorization to do

so is given by the Company. In the event that there is a potential

conflict of interest from the provision of services, the Company

may on its own undertake the tasks relating to such services or

hire other third party to do so.

(2) Assignment

Banpu cannot assign or transfer any rights or obligations under

this agreement to a third party without the Company’s prior

written consent.

2) BLCP

2.1) Power Purchase Agreement with EGAT

Parties (1) BLCP

(2) EGAT

Contract Period 25 years from the commencement date of commercial operations of

BLCP Unit 2; expiration in February 2032.

Contracted Capacity 1,346.5 MW (coal power)

17

2.1) Power Purchase Agreement with EGAT

Tariff Rate BLCP charges EGAT a tariff that consists of availability payments and

energy payments as follows:

(1) Availability Payments

BLCP shall receive availability payments from EGAT for

making its contracted power generation capacity of 1,346.5

MW available to EGAT. The availability payment covers the

power plant’s fixed costs and debt servicing expenses. EGAT

is required to make availability payments to BLCP regardless

of whether any power is dispatched to EGAT as long as

BLCP makes its capacity available to EGAT and meets

certain performance targets as specified in the BLCP PPA.

Availability payments are subject to deductions for reduced

availability of power generation capacity.

(2) Energy Payments

BLCP shall also receive energy payments from EGAT, which

comprise fuel payments to cover fuel costs incurred by BLCP,

and operation and maintenance payments. The calculation of

energy payments is a function of the coal and fuel costs, as

well as variable operating costs incurred when operating the

power plant, and the calculation uses an assumed efficiency.

The usage of fuel for power generation of the BLCP Power

Plant on the basis of the coal supply meeting heat rate at a

particular gross calorific value.

2.2) Coal Supply Agreement with ACH

Parties (1) BLCP

(2) ACH

Contract Period 25 years from the commencement date of commercial operations of

BLCP Unit 2; expiration in February 2032. However, contract period

may be extended per the extension of BLCP PPA.

18

2.2) Coal Supply Agreement with ACH

Price Coal price consists of the following components relating to FOB price,

freight and insurance:

(1) FOB Price: the FOB price of coal, calculated on July 1 of

each year, shall be the lower of (i) 98.00% of the Japanese

Power Utility Benchmark Price at the time of completion of

loading; or (ii) a specified US$ amount per MT, escalated by

the U.S. consumer price index less 1.02%, provided that the

minimum annual escalation shall be 2.48%.

(2) Freight Component: the freight component shall be an

aggregate of (i) a fixed amount per MT for the first 15 years

of the agreement and shall be agreed among the parties

thereafter and (ii) the indexed bunker fuel component of

US$1.00 per MT, which shall be increased to the extent that

the marine fuel oil spot price exceeds a specified US$

amount per MT.

(3) Insurance Component: the insurance component refers to

the insurance costs for covering marine cargo coal shipment,

as proposed by ACH and as approved by BLCP.

3) Hongsa

3.1) Hongsa Mine Mouth Power Project Concession Agreement

Parties (1) Hongsa

(2) Government of Laos

Concession Period From the effective date and continue until the 25th anniversary of the

commercial operation date of Hongsa Unit 3, subject to extentions

pursuant to the requirements of the agreement

Fees / Royalties Royalties in the amount of 1.5% of gross operating revenues after the

commercial operation date of Hongsa Unit 1.

3.2) Hongsa Mine Mouth Coal and Limestone Mining Concession Agreement

Parties (1) Phu Fai Mining Company Limited


Concession Period The effective date is upon the satisfaction of the conditions precedent

as specified in the agreement

Fees / Royalties Mining Fees

(1) US$0.4 per ton for the first 4.5 million ton of coal consumed

19

by the Hongsa Power Plant;

(2) US$1.03 per ton of coal consumed by the Hongsa Power

Plant, subject to annual escalation at the rate of 1.00% per

year starting from the commencement of commercial

operations of Hongsa unit 1 pursuant to the EGAT PPA; and

(3) US$0.07 per ton of limestone consumed by the Hongsa

Power Plant, subject to annual escalation at the rate of 1.00%

per year starting from the commencement of commercial

operations of Hongsa unit 1 pursuant to the EGAT PPA.

3.3) Tri Party Agreement for Sublease of the Hongsa Mine Mouth Coal and Limestone Mining Concession

Agreement

Parties (1) Phu Fai Mining Company Limited (the “Sublessor”)

(2) Hongsa


Objective / Description To sublease the right of the Sublessor under the Hongsa Mine Mouth

Coal and Limestone Mining Concession Agreement to Hongsa

Contract Period Commence as of the effective date and shall expire at the end of the

Sublease Period

Price and Payment In consideration of the Sublease of the Transferred Rights and

Transferred Obligations to Hongsa, Hongsa shall pay compensation to

the Sublessor as follows:

(1) US$0.40 for the first four million five hundred thousand tons

of coal consumed by the Hongsa Power Plant;

(2) US$2.00 per ton of coal consumed by the power project after

the first four million five hundred thousand tons of coal

consumed by the Hongsa Power Plant; and

(3) US$0.07 per ton of limestone consumed by the Hongsa unit

1 commencing on the commercial operation date under the

EGAT PPA between Hongsa and EGAT (collectively

“Sublease Fee”).

20

3.3) Tri Party Agreement for Sublease of the Hongsa Mine Mouth Coal and Limestone Mining Concession

Agreement

The Sublease Fee shall be computed monthly in arrears for each

fiscal Year of the Sublease Period including the sale price of test

energy to EGAT under the EGAT PPA between Hongsa and EGAT

and payable in US$ and Thai Baht in the same percentage as

received by Hongsa under the EGAT PPA.

The Sublease Fee shall be subject to escalation at the same

escalation rate applicable to the fuel payment as provided in the

Hongsa Mining CA.

3.4) EGAT Power Purchase Agreement

Parties (1) Hongsa

(2) EGAT

Contract Period The term shall commence from the Signing Date and continue until

the BIth anniversary of the commercial operation date (as may be

extended in accordance with the agreement).

Minimum Contracted Capacity 1,473.C MW

Tariff Rate (1) Availability Payments

EGAT shall pay Hongsa availability payments for capacity

actually made available to EGAT that is not in excess of the

contracted power generation capacity of 1,473 MW. The

availability payment covers the Hongsa Power Plant’s fixed

costs, debt servicing expenses and provides Hongsa with a

return on equity. EGAT is required to make availability payments

to Hongsa regardless of whether any power is dispatched to

EGAT as long as Hongsa makes the contracted capacity

available to EGAT and meet certain performance targets as

specified in the agreement. Availability payments are subject to

deductions for reduced availability.

(2) Energy Payments

EGAT shall pay Hongsa energy payments, which are intended to

cover the price of fuel used in the generation of power and

variable operating costs of the power project. The calculation of

fuel cost is based on a predetermined lignite costs, adjusted by

fluctuations in diesel price in Bangkok. Variable operating costs

are also predetermined, as adjusted by the consumer price index

of Thailand as announced by the Ministry of Commerce of

Thailand.

21

3.5) EDL Power Purchase Agreement

Parties (1) Hongsa

(2) EDL

Contract Period 25th years from the commercial operation date and such term may be

extended pursuant to terms specified in the agreement

Minimum Contracted Capacity 100.0 MW

Tariff Rate (1) Availability Payment

EDL shall pay Hongsa availability payments for actual capacity

actually made available to EDL that is not in excess of the

contracted power generation capacity of 100 MW. EDL is required

to make availability payments to Hongsa regardless of whether

any power is dispatched to EDL as long as Hongsa makes the

contracted capacity available to EDL and meet certain

performance targets as specified in the EDL PPA. Availability

payments are subject to deductions for reduced availability.

(2) Energy Payments

EDL shall pay Hongsa energy payments, which are intended to

cover the price of fuel used in the generation of power and

variable operating costs of the power project. Calculation of fuel

cost is based on a predetermined lignite costs, adjusted by

fluctuations in diesel price in Bangkok. Variable operating costs

are also predetermined, as adjusted by the consumer price index

of Thailand as announced by the Ministry of Commerce of

Thailand.

4) Shijiazhuang Chengfeng

4.1) Power Purchase Agreement with State Grid Hebei Electric Power Company

Parties (1) Shijiazhuang Chengfeng

(2) States Grid Hebei Electric Power Company

Contract Period From January 1, 2016 to December 31, 2016

Tariff Rate (1) RMB378.3/MW (for units 1, 2 and 3 of the power plant)

(2) RMB322.7/MW (for unit 4 of the power plant)

Price Adjustment Formula If the authority being responsible for price control adjusts the power

price on the duration of this contract, then the new price shall be in

accordance with the price specified by such the authority.

22

5) Zouping Peak

5.1) Purchase Agreement with Xiwang Group Co., Ltd.

Parties (1) Zouping Peak

(2) Xiwang

Contract Period The term of this agreement shall commence upon the execution of

this agreement and shall end on the day when Zouping Peak’s joint

venture term under the joint venture agreement is terminated, unless

earlier terminated in accordance with the expressed terms of this

agreement.

Tariff Rate The monthly initial Electricity Price is RMBC.JNJHB/kWh (exclusive of

VAT) and shall subject to the adjustment according to the State

regulations and with the rules and principles set forth in schedule of

this agreement.

Price Adjustment Formula The electricity fee payable in each Month shall be calculated as

follows:

Electricity Fee = Monthly Delivery (i.e., the total kWh electricity

delivered by Zouping Peak to Xiwang at the Electric Delivery Point

for the subject Month) x Electricity Price x (1+applicable VAT rate).

The electricity price shall be calculated and adjusted in accordance

with the following rules and methodology as prescribed in the

schedule of the agreement:

State/local Electricity Price adjustment:

Such adjustment shall be applied automatically to this agreement

and therefore the electricity price shall be adjusted in accordance

with the price prescribed by state and/or local authority.

Adjustment by virtue of change of laws:

The party shall consult each other and make adjustment to the

operating cost component so as to reflect such higher (lower) costs

and/or lower (higher) revenue due to such changes in the law.

In case such changes in law increase Zouping Peak’s, the Parties

shall consult with each other and make adjustment to the capital cost

component in order to reflect the additional expenditures in the cost

structure.

Special Adjustment:

When coal price increases, Adjusted Electricity Price = Original

Electricity Price + Increased in standard coal price x Coal

Consumption; and

When the coal price decrease, Adjusted Electricity Price = Original

23

5.1) Purchase Agreement with Xiwang Group Co., Ltd.

Electricity Price - Increased in standard coal price x Coal

Consumption.

Annual Adjustment:

In addition to the adjustment aforementioned, Zouping Peak shall

provide to Xiwang in December each year a report on the changes

of cost component in the year, and the proposed adjustment to the

Electricity Price in the next year. The parties shall mutually discuss

and determine to make corresponding adjustment to the electricity

price.

5.2) Steam Purchase Agreement with Xiwang Group Co., Ltd. (as amended)

Parties (1) Zouping Peak

(2) Xiwang

Contract Period The term of this agreement shall commence from the effective date

and shall end upon the expiry of the joint venture term.

Tariff Rate The steam tariff shall be adjusted to RMBDBI/ton (inclusive of

taxes) from January D, BCDD.

Price Adjustment Formula Based on the change of the internal coal price and other costs and

the relevant policies of Chinese Government, the parties will from

time to time make the assessment of the steam tariff as agreed in

the steam purchase agreement and determine the new steam tariff

according to the result of such assessment.

Project Feasibility Study

–None –

Technical Assistance

–None –

Future Projects

The Company is expanding its power project investment and delelopment domestically and

internationally through new greenfield opportunities, joint investments with partners, or through investment units.

Below is the list of projects under development from 2016 to 2020.

1. The Luannan CHP Plant Phase 2: expected to increase the installed power generation capacity

and steam generation capacity by 25.0 MW and 150.0 tph, respectively. The additional capacity is

scheduled to be commercially available in BCDK.

24

2. The Zouping CHP Plant Phase 4: expected to increase the installed power generation capacity

and steam generation capacity by 25.0 MW and 150.0 tph, respectively. The additional capacity is

scheduled to be commercially available in 2020.

3. The Shanxi Lu Guang Power Plant Project: expected to have an installed power generation

capacity of 1,320.0 MW and scheduled to commence its commercial operation in 2018.

4. Investment in Solar Power Generation Projects in Japan

4.1 Project Mukawa:expected to have an installed power generation capacity of 17.0 MW and

scheduled to commence its commercial operation in 2018.

4.2 Project Nari Aizu:expected to have an installed power generation capacity of 20.0 MW and


4.3 Project Awaji:expected to have an installed power generation capacity of 8.0 MW and


4.4 Project Yabuki:expected to have an installed power generation capacity of 7.0 MW and


4.5 Project Onami:expected to have an installed power generation capacity of 16.0 MW and


4.6 Project Yamagata:expected to have an installed power generation capacity of 20.0 MW and


5. Solar power generation projects in China to be acquired by the Company by end of 2016

5.1 The Haoyuan Project: expected to have an installed power generation capacity of 20.0 MW

and has commenced its commercial operation in June 2016.

5.2 The Huien Project: expected to have an installed power generation capacity of 20.0 MW

and scheduled to commence its commercial operation by December 2016.

6. Solar rooftop power generation company in Thailand is under development and expected to have

an installed capacity of 1.5 MW and scheduled to commence its commercial operation by

December 2016.

7. The Baiyudang Project, is located in shan county, Zhejiang province, China is to be acquired by

the Company. The project is expected to have an installed power generation capacity of 50.0 MW

and scheduled to commence its commercial operation by end of 2016.

25

Related Party Transactions For the year ended December JD, BCDI and the six months ended June JC, BCDE, the Company and its subsidiary had related party transactions,

with person whom the Company and its subsidiary may have a conflict of interest, as summarized below.

Details of the Company and its subsidiary’s related party transctions with person whom the Company and its subsidiary may have a conflict of interest for the year ended December

JD, BCDI and the six months ended June JC, BCDE

1. Management fee paid to Banpu

Related party Nature of transaction

For the

year ended

December 31, 2015

(Unit: Baht’000)

For the six

months ended

June 30, 2016

(Unit: Baht’000)

Necessity and rationale of the transaction

1.1 Banpu

(“the Parent”)

Banpu Power paid a

management fee for

management and advisory

services to the Parent.

To improve efficiency in organizational management, Banpu had been providing management and advisory services to

Banpu Power under a service agreement signed on 20 December 2006. The annual management fee was determined

at 30 million baht. The agreement was effective and automatically renewed until the agreement was terminated or a

new agreement was signed.

Beginning from 1 October 2015 onwards, Banpu will provide management and advisory services to Banpu Power under

a master service agreement signed on 24 September 2015 in replacement of the old service agreement. The agreement

relates to management and advisory services in (i) accounting and finance, (ii) internal audit, (iii) legal, (iv) general

administration, (v) information technology, (vi) human resources and (vii) asset management,etc. It will be effective for

two years and must be renewed within 30 days before the termination date.

In consideration between having Banpu Power’s in-house operations and outsourcing management and advisory

services from Banpu, outsourcing is deemed more beneficial to Banpu Power in both efficiency and cost because

Banpu has human resources with knowledge, capability and specialized expertise in businesses of power and coal,

which is a key raw material for Banpu Power’s operations. This will reinforce efficiency in Banpu Power’s management

and can reduce cost of training new personnel within a short period of time; therefore, the Company can continue

running its business smoothly. In addition, Banpu is also prompted with information technology system and operational

units with expertise, which builds confidence in security of information technology system and information storage, etc.

Price determination:

Under the management service agreement signed on 24 September 2015, management fee was determined at a fixed

price of 108million baht per year, taking into account cost of providing services i.e. number of personnel, cost of

- Management fee paid

to the Parent

49,500

54,000

- Other payables – the

Parent

- -

26


For the

year ended

December 31, 2015

(Unit: Baht’000)

For the six

months ended

June 30, 2016

(Unit: Baht’000)


equipment and amount of services rendered, plus a margin (cost-plus basis), and paid monthly within seven daysfrom

the beginning of each month.

Prospect of the transaction:

The transaction is ongoingaccording to the master service agreement signed on 24 September 2015 which will be

effective from 1 October 2015 onwards.

Audit Committee’s opinion:

The transaction supports Banpu Power’s ordinary course of business occurred under the agreement and the fee was

determined at a fixed price with service terms and conditions agreed upon under the agreement. The transaction is

transparent, rational and favourable to the Company.

2. Consultancy Service Agreement with related parties


For the

year ended

December 31, 2015

(Unit: Baht’000)

For the six

months ended

June 30, 2016

(Unit: Baht’000)


2. Consultancy

Service

Agreement with

related parties

BIC is the Company’s subsidiary with business operations in China PRC. It has human resources with capability and

expertise in coal and power businessesthat are idle and can adequately be outsourced to service Banpu and its

subsidiaries. Details are as follows:

2.1Asian American

Coal Inc.

(“AACI”)

2.1 BIC provided

management and

advisory services to

AACI

2.1 BIC entered into a consultancy service agreement with AACI, a subsidiary of Banpu. The agreement covers advisory

services in financial management, risk management, information technology and management training etc., and will

be valid for one year. If not terminated, the agreement will be automatically renewed. To terminate the agreement,

either party must inform the other party at least 90 days in advance.


Management fee was agreed upon under the consulancy service agreement, taking into account cost of providing

services, which was derived from salary expenses and related expenses per number of employees actually rendering

- Management fee

charged to related

parties

180,444

69,566

27


For the

year ended

December 31, 2015

(Unit: Baht’000)

For the six

months ended

June 30, 2016

(Unit: Baht’000)


- Other receivables –

related parties

- - the services, plus a margin (cost-plus basis), and paid monthly.


The transaction is ongoingand the fee will be determined on a cost-plus basis according to the consultancy service

agreement.


The transaction is rational and favourable to the Company.

2.2 Banpu

Australia

Company Pty.

Ltd. (“BPA”)

2.2 BIC provided

management and


BPA

2.2 BIC entered into a consultancy service agreement with BPA. The agreement relates to business consulting and

project evaluation as determined in the agreement by comparing to the budget plan and providing an analysis to the

respective project manager and as requested by the project manager. Moreover, BIC will recommend external

experts to assist in developing and improving project’s operational system. The agreement is valid for one year. To

terminate the agreement, either party must inform the other party at least 90 days before the expiry date. The

agreement expired on 31 December 2015. At present, the agreement is not renewed.


Consultancy fee was charged at a daily rate, which is derived from salary expense and related expenses per number of

employees actually rendering the services, plus a margin (cost-plus basis).


If the Company or its subsidiarieswish to enter into a related party transaction in the future, the Company or its

subsidiariesshall proceed according to the determined policy, measures and procedures of entering into a related party

transaction.



- Management fee

charged to related

parties

4,545 -


related parties

- -

2.3 Banpu

Mineral

(Singapore)

Pte. Ltd.

(“BMS”)

2.3 BIC provided

management and

advisory services

toBMS

2.3 BIC entered into a consultancy service agreement with BMS, a subsidiary of Banpu. The agreement relates to

business consulting for coal mining project management, planning and operating, finance, marketing and logistics

etc. The agreement is valid for one year. To terminate the agreement, either party must inform the other party at

least 90 days before the termination date.

28


For the

year ended

December 31, 2015

(Unit: Baht’000)

For the six

months ended

June 30, 2016

(Unit: Baht’000)


- Management fee

charged to related

parties

2,238

6,495


Management fee was agreed upon under the consulancy service agreement, taking into account cost of providing

services, which is derived from salary expense and related expenses per number of employees actually rendering the

services, plus a margin (cost-plus basis), and paid monthly.



agreement.




related parties

- 3,415

2.4 Banpu Mineral

Company

Limited

(“BMC”)

2.4 BIC provided

management and


BMC

2.4 BIC entered into a consultancy service agreement with BMC, a subsidiary of Banpu. The agreement relates to

advisory services in financial management, risk management, information technology and management training etc.

The agreement is valid for one year. To terminate the agreement, either party must inform the other party at least 90

days before the termination date.


Management fee was agreed upon under the consulancy service agreement, taking into account BIC’s cost of providing





agreement.



- Management fee

charged to related

parties

11,723 5,634


related parties

- 987

2.5 Banpu 2.5 BIC provided

management and


the Parent

2.5 BIC entered into a consultancy service agreement withBanpu. The agreement relates to advisory services in

financial management, risk management, information technology and management training etc. The agreement is

valid for one year. To terminate the agreement, either party must inform the other party at least 90 days before the

termination date.


Management fee was agreed upon under the consulancy service agreement, taking into account cost of providing - Management fee 49,811 18,688

29


For the

year ended

December 31, 2015

(Unit: Baht’000)

For the six

months ended

June 30, 2016

(Unit: Baht’000)


charged to the

Parent





agreement.




the Parent

- 3,274

3. Short-term loans from the Parent


For the

year ended

December 31, 2015

(Unit: Baht’000)

For the six

months ended

June 30, 2016

(Unit: Baht’000)


3. Banpu Banpu Power borrowed

from the Parent

Banpu Power borrowed from the Parent for the investments in Hongsa Power Plant and the solar rooftop power projects

in Thailand, corporate restructuring, dividends payable payment and working capital by entering into loan agreements

and promissory notes at interest rates of 4.04% to 4.37% per annum as of and for the year ended December 31, 2015

and at interest rates of 3.80% to 4.37% per annum for the six months ended June 30, 2016, respectively. The loans are

payable at call. As of 21 September 2016, the outstanding amount of short-term loans from the Parent was 13,716.60

million baht.


The interest rates received and interest rates paid to related parties under Banpu’s group equal to average cost of

financing plus a margin (cost-plus basis).


The Company plans to pay off the short-term loans from the Parent after its listing on the stock exchange.


Borrowing from the Parent for the Company’s working capital and debt repayment by determining interest rates in the

- Short-term loans

from the Parent

14,882,807 12,166,194

Movement of

short-term

loans during

the period

Beginning balance

1 January,

60,000 14,882,807

Addadditions 15,375,710 8,621,547

Lessrepayments (552,903) (11,338,160)

Ending balance

31 Dec2015

14,882,807

Ending balance

30 Jun2016

12,166,194

- Interestsexpense 192,101 229,815

30


For the

year ended

December 31, 2015

(Unit: Baht’000)

For the six

months ended

June 30, 2016

(Unit: Baht’000)


- Interests payable 51,409 38,832 same manner as that of subsidiaries under Banpu is rational and favourable to the Company. Banpu Power will pay off

the short-term loans from the Parent with proceeds from the initial public offering.

4. Advances to related parties


For the

year ended

December 31, 2015

(Unit: Baht’000)

For the six

months ended

June 30, 2016

(Unit: Baht’000)


4. 4.1 PT Indo

Tambangraya

Megah

Tbk(“ITM”)

4.2 PT

Indominco

Mandiri

(“IMM”)

4.1 Banpu Power paid

advances toITM

- Advances to related

parties

4.2 Banpu Power paid

advances toIMM

- Advances to related

parties

1,816

-

-

13

Advances were paid to affiliates under Banpu’s group for expenses in ordinary course of business, which are paid for in

advance by the other party, including transportation, fees and miscellaneous expenses, etc, to improve efficiency and

flexibility under the group’s management.


Bill and call at actual advance expensesto be paid in 15 days from the invoice date.


The transaction might be ongoing in the future as necessary. In the future, advances will be paid at actual price and in

the same manner as determined at present.


Advances to related parties in the Banpu’s group for expenses in the ordinary course of business which are paid for in

advance by the other party are rational.

5. Advances from related parties


For the

year ended

December 31, 2015

(Unit: Baht’000)

For the six

months ended

June 30, 2016

(Unit: Baht’000)


5. 5.1 Banpu 5.1 BIC received advances

from the Parent

Advances were received from affiliates under Banpu’s group to the Company’s group for expenses in ordinary course of

business, which are paid for in advance by the other party, including project exploration, transportation, fees and

31


For the

year ended

December 31, 2015

(Unit: Baht’000)

For the six

months ended

June 30, 2016

(Unit: Baht’000)


- Advances from related

parties

1,440 694 miscellaneous expenses, etc, to improve efficiency and flexibility under the group’s management.


Bill and call at actual advance expensesto be paid in 30 days from the invoice date.


The transaction might be ongoing in the future as necessary. In the future, advances will be paid at actual price and in

the same manner as determined at present.


Advances from related parties in the Banpu’s group for expenses in the ordinary course of business which are paid for

in advance by the other party are rational.

5.2 Asian

American

Coal Inc.

(“AACI”)

5.2 BIC received

advances from AACI


parties

-

1,311

5.3 PT Indo

Tambangray

a Megah

Tbk (ITM)

5.3 Banpu Power

received advances

from ITM


parties

2,502

-

32

Contractual Obligations and Commitments

The following table summarizes the principal components of our contractual obligations andcommitments

as of June JC, BCDE:

Payments due by Period

Total 2016 to 2021 From 2021 onwards

THB THB THB

(in millions)

Contractual Obligations

from financing and

lease agreements

Long-term loan from

financial institutions 175.9 175.9 —

Long-term leases ..... 69.9 66.0 3.9

Investment

Commitments (Off-

balance sheet)

Capital commitment for

fixed assets ............. 839.9 839.9 —

Investment commitment

for Shanxi Lu Guang

Power Plant Project 1768.6 1768.6 —

Investment commitment

for Luannan expansion

1,451.7

1,451.7 —

The principal components of the Company’s other contractual obligations and commitments, as set out in

the foregoing table, include long-term loans from financial institutions and long-term leases, capital commitment

for fixed assets for our CHP plants in China, investment commitment for the Hongsa Power Plant and investment

commitment for the Shanxi Lu Guang Power Plant.

The Company’s ability to obtain adequate financing to satisfy our contractual obligations and debt service

requirements may be limited by the Company’s financial condition and results of operations and the liquidity of

domestic and international financial markets.

Selected Risk Factors

1. Any inability of the Company and its joint ventures’ power plants or power generation projects to

generate or deliver power or steam may significantly adversely affect the Company’s business,

financial condition, results of operations and cash flows.

The Company is dependent upon its and its joint ventures’ power plants and power generation projects being

able to deliver electricity and steam to customers. The following events could prevent the Company and its joint

ventures from supplying power or steam to customers including but not limited to:

a) breakdown or failure of power and steam generation equipment or other equipment or processes;

33

b) planned and unplanned shutdowns including normal overhauls outsourced to third parties or delays

in such overhauls;

c) flaws in equipment design or in plant construction;

d) failure of power and steam civil structures or transmission systems, which may affect the Company’s

and its joint venture’s declared availability;

e) issues with the quality of, or interruption in the supply of, key inputs, including coal, water and

sunlight;

f) inability to operate due to a failure to meet licensing requirements or to obtain or maintain required

regulatory permits and approvals;

g) human errors, including mistakes made by an operator when operating any equipment;

h) pollution or environmental contamination affecting the plant operations;

i) force majeure and catastrophic events, including fires, explosions, landslides, earthquakes, tropical

storms, floods and terrorist acts; and

j) scheduled and unscheduled outages due to maintenance, expansion or refurbishment works.

2. The Company and its joint ventures are highly dependent on a small number of offtakers

The Company and its joint ventures sell substantially all of the electricity and steam produced to a small number

of offtakers. For example, BLCP has only contracted with EGAT for the sale of electricity generated from the

BLCP Power Plant and is not allowed to deliver electricity to a third party under the BLCP PPA. Hongsa sells the

majority of electricity generated from the Hongsa Power Plant to EGAT and part of the remaining amount to EDL.

In China, in respect of power sales, each of the Zhengding CHP Plant and the Luannan CHP Plant has only

entered into a power purchase agreement with the only power grid company in its respective country. In addition,

the Zouping CHP Plant has entered into a power purchase agreement and a steam purchase agreement solely

with Xiwang.

Any failure of the Company’s and its joint ventures’ offtakers to fulfill their payment or other contractual obligations

under related agreements or any disruption of the relationship with one or more offtakers could have a material

adverse effect on the Company’s business, financial condition, results of operations and cash flows.

3. The Company’s results of operations depend on a small number of assets.

Historically, the Company’s profits have been heavily influenced by the profit of BLCP, itsIC.CC% joint venture

that owns and operates the BLCP Power Plant. The Company’s share of profit from BLCP accounted for

approximately NH.K%, EE.N% and EC.B% of its profit before income taxes for the years ended December JD, BCDJ,

BCDH and BCDI, respectively. If any of the plants and power projects fail to be profitable or generate lower than

expected profits, its results of operation may be materially and adversely affected.

4. The power purchase agreements are only for fixed terms.

The power purchase agreements for the BLCP Power Plant, the Hongsa Power Plant and the solar power

generation projects in Japan are for a duration ranging from 20 to 25 years. The Zhengding CHP Plant and the

Luannan CHP Plant sell power under annual power purchase agreements which are subject to renewal every

year, while the Zouping CHP Plant has a 28-year power purchase agreement expiring in June 2029 with Xiwang

for the sale of power. None of these power purchase agreements contain extension options and there can be no

assurance that the tenure of the power purchase agreements for any of these projects will be extended beyond

34

its initial term, or that the Company and its joint ventures will be able to enter into power purchase agreements or

steam purchase agreements with other parties within timely manner or be able to find any other offtakers at all

when the Company’s existing agreements expire. In As such, if there is no extension or extensions are entered

into on less favorable terms, the Company’s business, financial condition and results of operations may be

adversely affected.

5. Fuel Supply Risks

The success of the Company’s and its joint ventures’ operations depends on, among others, the ability to source

a sufficient amount of coal, the principal raw material, at competitive prices for the operation of air coal-fired

power plants. Interruption in coal supplies or an increase in the cost of coal may adversely affect the Company’s

business, financial condition, results of operations and cash flow

Other factors which may affect the Company’s business, financial condition, results of operations and cash flow

include limitations in the pass-through of fuel costs and an increase in mining costs at the Hongsa Lignite Mine

since the profitability of the Hongsa Power Plant thus depends on lignite production costs.

6. The Company’s and its joint ventures’ power generation operations are dependent on the ability to

obtain, maintain and renew licenses and approvals and maintain relevant concessions.

The Company and its joint ventures require various licenses and approvals from the relevant governmental

authorities to operate in the power generation businesses. The relevant governmental entities (whether at the

central Government or provincial, regional or local government level) may not issue or renew the licenses or

approvals relating to the Company’s and its joint ventures’ business operations in the timeframe the Company

anticipate or at all. There is no assurance that the Company and its joint ventures will be able to obtain, maintain

or renew licenses and approvals and comply with licensing and approval requirements in the future, and in the

event that the Company and its joint ventures fail to do so, the Company’s and its joint ventures’ operations could

be interrupted or cease completely, either of which could have a material and adverse effect on the Company’s

business, results of operations and financial condition.

7. BLCP may not be able to renew its lease agreement for the power plant site from IEAT before the BLCP

PPA expires.

The lease agreement for the site where the BLCP Power Plant is located will expire prior to the expiration of the

power purchase agreement. If BLCP fails to renew its lease agreement, it will be required to return the land to the

IEAT and will no longer be able to operate the BLCP Power Plant after the expiration of such the lease

agreement. Although BLCP plans to extend such the lease term to at least cover the term of its power purchase

agreement, the Company cannot guarantee that BLCP will be able to extend the lease term of the land or it will

be adequate as expected by BLCP, or that any such extension (if it is extendable) will be on terms reasonable,

acceptable and beneficial to BLCP or us. In such an event, the Company’s business, results of operations,

financial condition and cash flow could be materially and adversely affected.

8. The Company may be subject to liabilities in relation to the Hongsa Power Project Court Case.

In 2007, a group of individuals and corporate entities (collectively, the “Plaintiffs”), who were ex-developers of the

Hongsa Power Plant, filed a civil lawsuit at the Thai Civil Court (the “Civil Court”) against Banpu, Banpu

International Ltd. and the Company, together with three of Banpu’s executives (collectively, the “Defendants”),

35

based on the allegations that the Company had deceptively entered into a joint development agreement with the

Plaintiffs for the purpose of gaining access to information of the Hongsa Power Plant and the Hongsa Lignite

Mine, and had, in bad faith, misinformed the Lao government, which caused the Lao government to terminate

their concessions for Hongsa Power Plant and the Hongsa Lignite Mine and allowed Hongsa to directly enter into

a concession contract with the Lao government. The Plaintiffs demanded the Defendants to pay damages of

THB2,000 million for the value of the Hongsa Power Plant information, another THB2,000 million for their

investment costs incurred for the studies and expenditures in the Hongsa Power Plant, and THB59,500 million for

the potential lost profits resulting from the termination of their concessions, totaling THB63,500 million plus

interest thereon. The Defendants also have counterclaimed that the Plaintiff unlawfully terminated the joint

development agreement causing damages to Banpu, Banpu International Ltd., and us.

In September 2012, the Civil Court issued a judgment concluding that although the Defendants did not breach the

joint development agreement, the Defendants committed a wrongful act by using the Plaintiffs’ information of the

Hongsa Power Plant (for the development of a 600.0 MW power plant) to develop the 1,800.0 MW power plant.

The Civil Court ordered Banpu and us to pay to the Plaintiffs damages of THB2,000 million for the value of the

information, another THB2,000 million for the investment costs for the studies and expenditures in the Hongsa

Power Plant, totaling THB4,000 million plus 7.5% interest per annum from the date of the complaint until full

payment and for loss of profits of THB860 million per year for the years from 2015 to 2027 and THB1,380 million

per year for years from 2028 to 2039, payable at each year end, totaling THB27,740 million. Total damages

amounted to THB31,745 million. The complaints involving Banpu International Co., Ltd. and Banpu’s executives

were dismissed.

The decision was appealed and, in September 2014, the Civil Court announced the judgment of the Appeal Court

of Thailand (the “Appeal Court”) whereby the Plaintiffs’ complaint and the Defendants’ counterclaim were

dismissed. The Appeal Court concluded that the Defendants had acted in good faith before and after the joint

development agreement was entered into, and that the Defendants did not commit any wrongful acts against the

Plaintiffs. The Appeal Court also found that it was the Plaintiffs that breached the joint development agreement,

and that the Defendants had no obligation to return to the Plaintiffs the documents containing the information

relating to the Hongsa Power Plant and the Hongsa Lignite Mine.

As of Semtember 2016, the case has not concluded, as the Plaintiffs have now filed a petition to the Supreme

Court of Thailand (the “Supreme Court”) against the judgment of the Appeal Court. It is expected that the appeal

process will take approximately three to five years.

While the Company believe that the Plaintiffs’ allegations have no merit and the Company have not taken any

reserves in relation to the litigation, the litigation is time-consuming and costly, and the Company’s senior

management shall pay attention to the litigation. The outcome of litigation is subject to inherent uncertainties and

may depend upon factors outside of the Company’s control. While the outcome of the litigation will not affect the

Company’s interest in Hongsa or Hongsa’s concessions, an unfavorable resolution of the litigation or any future

allegations, lawsuits or proceedings could materially and adversely affect the Company’s business, prospects,

results of operations and financial condition and the market prices of the Company’s Shares

36

9. The loss of certain tax exemptions and tax incentives or the imposition of new taxes would increase the

Company’s and its joint ventures’ tax liability and decrease the Company’s future profits.

BLCP has obtained investment promotion privileges from the Board of Investment of Thailand (the “BOI”) for the

BLCP Power Plant, under which BLCP is eligible for a 50.0% tax exemption from April 2014 to March 2019.

Hongsa has also received, among others, certain income tax relief from the Standing Committee of the National

Assembly of Laos, which shall be in place from the signing of the Hongsa mine mouth power project concession

agreement in November 2009 until the seventh year after the date of commencement of commercial operations of

Hongsa Unit 3, which was in March 2016.

The loss of these tax exemptions and tax incentives or the imposition of new taxes could have a material adverse

effect on BLCP’s and Hongsa’s and, as such, the Company’s financial condition, results of operations and cash

flows.

10. The Company holds interests in solar power projects in Japan through a TK structure under which the

Company do not exercise control over their operations.

The Company currently hold interests in seven solar power projects in Japan through the TK structure. The TK

structure is a Japanese partnership structure governed by a contract between an investor and a TK operator

under which the investor makes certain contributions to the TK operator (in the form of cash or other things of

value) in return for the right to receive distributions of profits generated from the business. Under Japanese law,

neither the TK investor nor its officers, directors, employees or representatives actively manage and operate the

TK business, nor do they have any authority to act for the TK operator. Further, a TK investor does not have

voting rights in relation to the decisions to be made by the TK operator or any rights to actively participate in the

decision-making process of the TK business.

In order to assure the bona fide TK nature, the TK operator should not be subject to the full control by the TK

investor and shall be independent from the TK investor. In such a situation, however, there can be no assurance

that the interests of TK operators will be aligned with the Company’s interests and the TK operators may make

decisions or take actions that are not in line with the Company’s interests, causing a material adverse effect on

the Company’s business, prospects, and operations.

11. Exchange rate fluctuations may have a material adverse effect on the Company’s results of operations.

The Company and its joint ventures have power generation operations in Thailand, Laos, China and investment

interests in power generation projects in Japan, and generate sales in a number of currencies, including the Thai

Baht, U.S. dollar, Renminbi and Japanese yen. Conducting business across multiple currencies subjects the

Company and its joint ventures to currency fluctuation risks. In particular, fluctuations in currency exchange rates

could have an impact on the translation of foreign currency-denominated amounts into the Thai Baht, which is the

Company’s functional currency. In addition, fluctuations in currency exchanges could have an impact on the

Company’s results of operations when the Company and the Company’s joint ventures transact through the use

of foreign currencies. The above exchange rate risks could have a material adverse effect on the Company’s

business and results of operations.

37

12. The structure and provisions of the Company’s and its joint ventures’ financing arrangements could

give rise to certain risks.

The use of borrowings presents certain additional risks for the Company and its ventures. The Company and its

joint ventures may be unable to service interest payments and principal repayments or comply with other

requirements of loans, rendering borrowings immediately repayable in whole or in part, together with any

attendant cost. In addition, some of the Company’s and its joint ventures’ borrowings are generally secured

against the project company’s assets. Any event of default, including a default in the payment of principal or

interest of loans, would result in the lenders enforcing their security. Any cross-default provisions contained in our

or our joint ventures’ loan could magnify the effect of an individual default and if such a provision were exercised,

this could result in a substantial loss to the Company and its ventures.

Litigation

In 2007, a group of individuals and corporate entities (collectively, the “Plaintiffs”), who were ex-developers of the

Hongsa Coal Mine and the Hongsa Power Plant, filed a civil lawsuit at the Thai Civil Court (the “Civil Court”)

against Banpu, Banpu International Ltd. and the Company, together with three of Banpu’s executives (collectively,

the “Defendants”), based on the allegations that the Defendants had deceptively entered into a joint development

agreement with the Plaintiffs for the purpose of gaining access to the information of the Hongsa Power Plant and

the Hongsa Lignite Mine, and had, in bad faith, misinformed the Lao government, which caused the Lao

government to terminate the Plaintiff’s concessions for Hongsa Power Plant and the Hongsa Lignite Mine in order

that the Company could directly enter into a concession contract with the Lao government. The Plaintiffs

demanded that the Defendants pay damages of THB2,000 million for the value of the Hongsa Power Plant

information, another THB2,000 million for their investment costs for the studies and expenditures in the Hongsa

Coal Mine and the Hongsa Power Plant, and THB59,500 million for the lost profits resulting from the termination

of their concessions, totaling THB63,500 million plus 7.5% interest per annum thereon. The Defendants have also

counterclaimed that the Plaintiffs unlawfully terminated the joint development agreement, causing damages to

Banpu, Banpu International Ltd. and the Company.

In September 2012, the Civil Court issued a judgment concluding that the Defendants did not breach the joint

development agreement; the Plaintiffs breached the terms of the joint development agreement; and the

Defendants committed a wrongful act by using the Plaintiffs’ information of the Hongsa Power Plant (for the

development of a 600.0 MW power plant) to develop the 1,800.0 MW power plant. The Civil Court ordered Banpu

and the Company to pay to the Plaintiffs damages of THB2,000 million for the value of the information, another

THB2,000 million for the investment costs for the studies and expenditures in the Hongsa Coal Mine and the

Hongsa Power Plant, totaling THB4,000 million plus 7.50% interest per annum from the date of the complaint until

full payment, and for loss of profits of THB860 million per year for the years from 2015 to 2027 and THB1,380

million per year from 2028 to 2039, payable at each year end, totaling THB27,740 million. Total damages

amounted to THB31,740 million. The Civil Court dismissed the counterclaim of us, Banpu International Ltd. and

the Banpu’s executives.

The decision was appealed, and in September 2014, the Civil Court announced the judgment of the Appeal Court

of Thailand (the “Appeal Court”) whereby the Plaintiffs’ complaint was dismissed. The Appeal Court concluded

that the Defendants had acted in good faith before and after the joint development agreement was entered into,

38

and that the Defendants did not commit any wrongful acts against the Plaintiffs. The Appeal Court also found that

it was the Plaintiffs that breached the joint development agreement, and that the Defendants had no obligation to

return to the Plaintiffs the documents containing the Plaintiff’s information relating to the Hongsa Power Plant and

the Hongsa Lignite Mine.

As of Semtember 2016, the case has not concluded, as the Plaintiffs have now filed a petition to the Supreme

Court of Thailand (the “Supreme Court”) against the judgment of the Appeal Court. It is expected that the appeal

process will take approximately three to five years.

While the Company believes that the Plaintiffs’ allegations have no merit, and the Company has not taken any

reserves in relation to the litigation, the litigation is time-consuming and costly and could divert the attention of our

senior management. An unfavorable resolution of the litigation or any future allegations, lawsuits or proceedings

could materially and adversely affect the Company’s results of operations and financial condition and the market

prices of our shares.

As of June 30, 2016, the Company did not record a contingent liability in respect ofthis case in the Company’s

financial statements, and the Companyhave not taken any reserves inrelation to the litigation. Other than as

disclosed in the foregoing and to the Company’s best knowledge, the Company and its subsidiaries are not

involved in any lawsuitor any other legal action which the Company believes it may cause materially andadversely

affect the Company’s assets and business operations but are not evaluate thevalue of effect and the Companyis

not involved in any lawsuit which is not relatingto our business operation. There are no other threatened or

pending lawsuitswith respect to the Company or any of the power plants or power generation projectsin which the

Company have an interest.

Employees As of 30 June 2016, the Company and its subsidiaries which are operating core business

companies have permanent employees (exclude directors and management) as follows:

The Company and its subsidiaries which are operating

core business companies Number of employees

1. The Company 33

2. Shijiazhuang Chengfeng Cogen Co., Ltd.

(Core company)

300

3. Tangshan Banpu Heat and Power Co., Ltd. 242

4. Zouping Peak CHP Co., Ltd. 279

5. Banpu Investment (China) Co., Ltd. 69

Remarks: As at 4 July 2016, the Company acquired Anqiu Huineng Renewable Energy Co., Ltd.and as at 7

September 2016, the Company acquired Weifang Tian’an Jinshan Comprehensive Energy Co., Ltd.

Both companies are operating core business subsidiaries in China. They have no permanent

employee.

The Company’s subsidiaries that operate as intermediary companies including (D) Banpu Coal

Power Ltd. (B) Banpu Power International Ltd. (J) Banpu Power Investment Co., Ltd. (H) Pan-

Western Energy Corporation LLC and (I) Banpu Renewable Singapore Pte. Ltd. have no

permanent employee.

39

Summary of the Company’s Background

The Company was incorporated in Thailand in 1996. The Company is a holding company which holds shares in

other companies that mainly operate power generation and distribution business and other related

businesses.While the Company primarily derives our profit from its interests in conventional power generation

assets at present, the Company has also expanded our portfolio of power generation assets to renewable power

and other related business in Thailand, Laos, China and Japan. Banpu as the Company’s principal shareholder

owned 100.00% of our issued and paid-up share capital with three individual shareholders each holding one

share.

As of September 30, 2016, the Company has an equity installed capacity of 1,913.0 MWe in operation,

comprising 1,711.2 MW of coal power, 813.0 tph of steam, and 56.6 MW of solar power.

The Company has close to BC years of experience in developing power generation projects. Banpu, a parent

company, successfully co-established The Cogeneration Company Limited under EGAT’s SPP scheme to provide

power and steam to the Map Ta Phut Industrial Estate in DKKJ. Under EGAT’s IPP scheme, the Company also

developed the Tri Energy Co., Ltd., a NCC.C MW combined cycle power plant, and BLCP, a D,HJH.C MW coal-fired

power plant. In addition, in BCCE the Company expanded into China, where the Company currently has J power

plants in operation. In addition, the Company entered into a shareholders’ agreement with Ratch and LHSE to

jointly establish Hongsa in 2009. Hongsa Power Plant has installed capacity of 1,878.0 MW. In 2014, the

Company diversified our business into solar power generation by acquiring investment stakes in solar power

generation projects in Japan.

In this regard, Banpu Group completed a restructuring under which all of the power generation assets of Banpu

Group were consolidated under the Company. The restructuring includes the acquisition of 100% equity interest

in Banpu Renewable Energy Co., Ltd., an intermediate holding company of certain solar power generation assets

in Japan, from Banpu in October 2014. Also, the Company acquired equity interest in Banpu Power International

in August 2015. Moreover, the Company coverted into a public company and officially changed registered name

to Banpu Power Public Company Limited.

During March to May 2016, the Company entered into share purchase agreements for acquisition of 100.00%

equity stakes in four solar power projects in China, namely the Jinshan Project, the Huineng Project, the Haoyuan

Project and the Huien Project. The Company completed the acquisition of the Huineng Project in July 2015. After

that, the Company also entered into an investment agreement for the 100.00% investment in Project Yamagata.

In May 2016, the Company entered into a share purchase agreement for the acquisition of Thai Solar Consultant,

a solar rooftop power generation company in Thailand. In addition, the Company completed the acquisition of the

Jinshan Projectin September 2016.

Investment in Subsidiaries/Associated Companies/Related Companies

As of June 30, 2016, the Company has investments in subsidiaries, associated companies and joint ventures as

follows:

Company Name Nature of Business Registered Capital Paid-up Capital

(shares)

Thailand

1. BLCP Power Limited(“BLCP”) Power generation and sales THB 12,010,000,000 120,100,000

2. Banpu Coal Power Limited Investment in power business THB 5,921,587,160 592,158,716

40


(shares)

3. Banpu Renewable Energy Company

Limited(“Banpu Renewable Energy”)

Investment in power business THB 960,000,000 96,000,000

4. BPP Renewable Company Limited Investment in power business THB 5,000,000 500,000

5. Thai Solar Consultant Company Limited(“Thai

Solar Consultant”)

Solar rooftop power

generation

THB 1,000,000 100

China

6. Shijiazhuang Chengfeng Cogen Company

Limited (“Zhengding”)

Power and steam generation

and sales

USD 30,516,000 N/A(1)

7. Tangshan Banpu HeatandPower Company

Limited (“Luannan”)


and sales

USD 47,504,000 N/A(1)

8. Zouping Peak CHPCompanyLimited

(“Zouping”)


and sales

RMB 261,800,000 N/A(1)

9. Shanxi Lu Guang Power Company Limited

(“Shanxi Lu Guang”)

Power generation and sales RMB 1,500,000,000 N/A(1)

10. Banpu Investment (China) Limited Investment in power business USD 30,000,000 N/A(1)

11. BPP Renewable Investment (China) Company

Limited

Investment in renewable

energy business

USD 30,000,000 N/A(1)

12. Anqiu Huineng Renewable Energy Company

Limited

Solar power generation RMB 66,000,000 N/A(1)

13. Weifang Tian’an Jinshan Comprehensive

Energy Company Limited

Solar power generation RMB 83,000,000 N/A(1)

Hong Kong

14. Akira Energy Limited Investment in renewable

energy business

HKD 62,017,100 62,017,100

15. Akira Energy (South) Limited Investment in renewable

energy business

HKD 19,120,063 19,120,063

16. Akira Hokkaido Limited Investment in renewable

energy business

HKD 500 500

Laos

17. Hongsa Power Company Limited (“Hongsa”) Hongsa Power Company

Limited

USD 927,000,000 92,700,000

18. Phu Fai Mining Company Limited Phu Fai Mining Company

Limited

50,000 5,000

Mauritius

19. Banpu Power InternationalLimited (“Banpu

Power International”)

Investment in power business USD 63,050,000 63,050,000

Singapore

20. Zouping Peak Pte. Limited Investment in power business SGD 2 2

21. Banpu Power InvestmentCompany Limited Investment in power business USD 84,177,391 77,132,663

22. Banpu Renewable SingaporePte. Limited Investment in renewable

energy business

USD 17,125,478.73

17,125,478

41


(shares)

23. Aizu Energy Pte. Limited Investment in renewable

energy business

USD 2,080,061.12 2,080,059

Cayman Island

24. Pan-Western Energy Corporation LLC Investment in power business USD 100,000 10,000,000

Note: (1) Companies are not established in form of Joint-stock company, thus the companies do not issue shares

Increase (Decrease) in Registered Capital in the Last 3 Years

Date Paid-up Capital

(Decrease) Increase

Paid-up Capital after

Capital (Decrease)

Increase

Note/Use of Proceeds

August 28, 2015 THB 6,950,000,000 THB 12,971,995,000 Payment to Banpu for the acquisition of

equity interest in Banpu Power

International

February 15, 2016 THB 11,000,000,000 THB 23,971,995,000 Repayment of loans from Banpu

Accounting Period 1 January – 31 December

Auditor Ms. Amornrat Pearmpoonvatanasuk

Certified Public Accountant (Thailand) No.4599

PricewaterhouseCooper ABAS Ltd.

Registrar

Securities Registrar : Thailand Securities Depository Company Limited (TSD)

Financial Advisors

Financial Advisor (1) : Thanachart Securities Public Company Limited

Financial Advisor (2) : Bualuang Securities Public Company Limited

Financial Advisor (3) : The Quant Group Company Limited

Lead Underwriters

Lead Underwriter (1) : Kasikorn Securities Public Company Limited

Lead Underwriter (2) :Thanachart Securities Public Company Limited

Lead Underwriter (3) : Bualuang Securities Public Company Limited

Dividend Policy

The Company’s capability to make any distribution of dividends is in accordance with laws and

regulations including PublicLimited Company Act B.E. 2535 (1992) which prescribes that a public company limited

may make a distribution ofdividends from separate financial statements if there is no accumulated losses.

Pursuant to the meeting of the board of directors of the Company no. 11/2558 dated on August 21, 2015

adopted aresolutions to approve the dividend policy of the Company and its subsidiaries by prescribing that the

Company and itssubsidiaries to pay dividends at the rate of not less than 50.0% of the Company’s consolidated

net profits after deducting any reservefunds as required by law or as the Company’s may establish where

42

appropriate in each year. However, the Company’s dividend payment ratio maybe subject to changes, depending

on cash flows and investment obligations of the Company and its subsidiaries, including anylimitations under

laws, regulations and other necessity.

However, the Companyis a holding company which does not operate any material businesses. The Company’s

main assets are investments in subsidiaries and joint ventures. Accordingly, the Company’s ability to pay

dividends mainly depends on the operationalresults of, and payment of dividends by, its subsidiaries and joint

ventures. Payment of dividends by the Company’s subsidiaries andjoint ventures is subject to applicable laws in

their respective jurisdictions. Payment of dividends by non-Thai subsidiariesand joint ventures may also be

subject to expenses such as withholding taxes (in case of dividends payment from ourbusinesses in China) at the

rate of 10% and gain or loss from foreign exchange rates.

Tax Benefits

BLCP has obtained investment promotion privileges from the BOI on August BD, BCCC, under which it was

granted a DCC% exemption from corporate income tax on the net profit derived from the power generation

business for a period of eight years from the date BLCP first generated revenue. While the DCC% tax exemption

expired on March JD, BCDH, BLCP is still eligible for a IC% exemption from corporate income tax on the net profit

derived from the power generation business for a period of five years, from April D, BCDH to March JD, BCDK.

Moreover, Hongsa has received, among others, certain income tax relief from the Standing Committee of the

National Assembly of Lao People’s Democratic Republic, which shall be in place from the signing of the Hongsa

mine mouth power project concession agreement in November BCCK until the seventh year after the

commencement of commercial operations of Hongsa Unit J, which was in March BCDE. For the eighth year after

the commencement of commercial operations of Hongsa Unit J and every year thereafter during the concession

period, Hongsa will be subject to the prevailing income tax rate, which is currently DI% of its net taxable income.

Number of Shareholders

As of 25 October 2016

Number of

Shareholders

Number of

Shares

% of Paid-up

Capital

1. Strategic shareholders

1.1 Directors, managers and executive management

including related persons and associated persons

15 2,746,075 0.09

1.2 Shareholders who have a holding of above 5%

including related parties

1 2,397,199,497 78.71

1.3 Controlling shareholders - - -

2. Non-strategic shareholders hold >1 trading unit 37,917 645,626,171 21.20

3. Non-strategic shareholders hold < 1 trading unit 2,165 120,257 -

Total Shareholders 40,098 3,045,692,000 100.00

43

Major Shareholders

Shareholders

Post-IPO Pre-IPO

Number of

Shares

Percentage of

Paid-up

Capital

Number of

Shares

Percentage of

Paid-up Capital

D. Banpu Public Company

Limited

B,JKN,DKK,HKN 78.71 B,JKN,DKK,HKN 100.0C

2. Credit Suisse (Singapore)

Limited1/

162,800,000 5.35 -

-

3. The Vongkusolkit Family

Mitr Phol Sugar Corp., Ltd.

TME Capital Co., Ltd.

City Holding Co., Ltd.

United Farmer and Industry

Co., Ltd.

MP Particle Board Co., Ltd.

Mid-Siam Capital Co., Ltd.

Pacific Sugar Corporation

Ltd.

Mitr Phol Bio-Power (Phu

Viang) Co., Ltd.

Ufinves Co., Ltd.

Mitr Kalasin Sugar Co., Ltd.

BN,EED,JBK

DH,KJC,BIN

6,536,988

2,187,545

1,844,149

1,576,270

772,452

706,700

637,569

684,201

497,452

0.91

C.HK

C.BD

C.CN

C.CE

C.CI

C.CJ

C.CB

C.CB

C.CB

C.CB

2

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

4. CIMB SECURITIES

(SINGAPORE) PTE. LTD.

15,200,000 0.50 -

-

5. Bualuang Long-term Equity

Fund

12,732,600 0.42 - -

6. Thai NVDR Company

Limited

K,BDJ,DNO C.JC - -

7. Provident fund for EGAT

employees

6,037,535 0.20 - -

44

Shareholders

Post-IPO Pre-IPO

Number of

Shares

Percentage of

Paid-up

Capital

Number of

Shares

Percentage of

Paid-up Capital

8. Bangkok Life Assurance

Co., Ltd.

I,5BB,HDO C.D8 - -

9. Bualuang Long-term Equity

Fund 75/25

5,182,500 0.17 - -

10. AIA COMPANY LIMITED -

APEX

AIA COMPANY LIMITED -

TIGER

Mr. Charnchai Horkradarn

Others

I,DIC,CCC

I,DIC,CCC

D

363,469,359

C.DN

C.DN

-

11.93

-

-

1

-

-

-

-

-

Total 3,045,692,000 100.00 2,397,199,500 100.00 1/Credit Suisse (Singapore) Limited as an initial purchaser in this initial public offering will not allocate shares in this offering to BPP’s

strategic shareholders. The highest allocation from Credit Suisse (Singapore) Limited was to a cornerstone investor, which

represents 2.95% of the paid-up capital after this initial public offering.

Foreign Shareholders As of 25 October 2016, the Company has 139 foreign shareholders with total of

196,603,853 shares or equal to 6.46 percent of total paid-up capital

Note: The Company has restriction on foreign shareholders in Section 10 of the Articles of

Association, stating that “Foreign shareholders can hold shares in the Company at no more than 40

percent of paid-up capital of the Company”

Board of Directors

As of JC June BCDE, the Board of Directors consists of K members as follows:

Name Position Starting date

1. Dr. Naris Chaiyasoot Chairman of the Board, Independent

Director, Member of the

Audit committee

4 August 2015

Chairman of the Corporate Governance

andNomination Committee

21 August 2015

2. Mr. Chanin Vongkusolkit Director 12 December 1996

Member of the Corporate Governance


21 August 2015

3. Mrs. Somruedee Chaimongkol Director 30 July 2009

45


Member of the Remuneration Committee 21 August 2015

4. Mr. Akaraphong Dayananda Director 30 July 2009

5. Mr. Voravudhi Linananda Director 30 July 2009

Chief Executive Officer 10 April 2015

Acting Senior Vice President - Strategy and

Asset Management

1 July 2015

6. Mr. Metee Auapinyakul Director 22 May 2015

Member of the Remuneration Committee 21 August 2015

7. Mr. Rawi Corsiri Director 19 May 2015

Member of the Corporate Governance


21 August 2015

8. Mr. Yokporn Tantisawetrat* Independent Director, Chairman of the

Audit Committee

4 August 2015

9. Dr. Bundhit Eua-arporn Independent Director, Member of the Audit

Committee, Chairman of the Remuneration

Committee

4 August 2015

Remarks: * Director with sufficient knowledge and experience in accounting and finance to be responsible for reviewing the

reliability of the Company’s financial statements

Mr. Voravudhi Linanandaacts as the Corporate Secretary.

Audit Committee

As of JC June BCDE, the Audit committee consists of J members as follows:


1. Mr. Yokporn Tantisawetrat* Chairman of the Audit committee 4 August 2015

2. Dr. Naris Chaiyasoot Member of the Audit committee 4 August 2015

3. Dr. Bundhit Eua-arporn Member of the Audit committee 4 August 2015

Remarks: * Director with sufficient knowledge and experience in accounting and finance to be responsible for reviewing the

reliability of the Company’s financial statements

Mr. Prapat Manorat acts as the Company’s Audit Committee Secretary

The scope of duties and responsibilities of Audit Committee

The audit committee is accountable for reviewing the Company’s financial reports, adequacy of the

internal control system, risk management system in compliance with the relevant laws, rules and regulations and

preparing Audit Committee report or providing opinion to the Board of Directors for approval or proprosal to the

shareholders’ meeting case by case as set forth below:

1. To review the Company’s financial reporting and ensure that it is accurate and adequate

46

2. To review the Company’s internal control system and internal audit and ensure that they are appropriate

and efficient

3. To review and ensure that the Company has duly complied with the laws on securities and exchange,

the SET regulations, and the laws relating to the Company’s business

4. To consider, select and nominate an independent auditor, to propose the independent auditor’s

remuneration, and to attend a non-management meeting with the independent auditor at lease once a

year

5. To consider related party transactions or transactions that may lead to conflicts of interest to ensure that

they are in compliance with SET regulations and that they are rational and for the highest benefit of the

Company

6. To prepare Audit Committee’s report and disclose it in the Company’s annual report. The Audit

Committee’s report must be signed by the Chairman of the Audit Committee and contain at least the

following information:

6.1 Opinion on the accuracy, completeness and creditability of the Company’s financial report

6.2 Opinion on the adequacy of the Company’s internal control system

6.3 Opinion on the compliance with the SETregulations, or the laws relating to our business

6.4 Opinion on the suitability of the auditor

6.5 Opinion on transactions that may lead to conflicts of interest

6.6 Number of Audit Committee’s meetings and each committee memeber’s attendance record of

the meetings

6.7 Opinion or overview comment received by the Audit Committee from their performance of duties

in accordance with the Charter of the Auditor

6.8 Other transactions which, according to the audit committee’s opinion, should be known to the

Company’s shareholders and general investors, under scope and responsibilities assigned by

the Board of Directors

7. To audit suspicious cases, as informed by the auditor, that the Company’s directors, managers or any

persons responsible for its operations may have committed an offence as specified under the Securities

and Exchange Act B.E. BIJI and to report the result of the preliminary inspection to the SEC and the

auditor within JC days after being informed by the auditor

8. To review and continue monitoring major risk management procedures from the management’s risk

management committee and to review financial derivatives transactions, including commodity hedging

with counter parties, to connect with the internal control

9. To consider the independence of the internal control department, to provide opinions on the operational

plan and results, budgeting and manpower of the internal audit department and to approve the

appointment or transferor dismissal of the head of the internal control department

10. To review the audit committee’s charter at least once a year

11. To review and approve the internal audit charter

47

12. To submit Audit Committee report to the Board of Directors at least once a year

13. To request management or head of departments to clarify or submit relevant documents within the Audit

Committee’s scope of duties and responsibilities

14. To consult with independent specialists within the Audit Committee’s scope of duties and responsibilities

as appropriate at the Company’s expenses

15. To perform any other tasks as assigned by the Board of Directors upon the Audit Committee’s consent

Listing Conditions

–None –

Silent Period

Shareholders, who own common shares before the Company’s public offering, holding 1,675,130,600

shares or 55% of paid up capital after the initial public offering certify to the Stock Exchange of Thailand that their

shares will not be sold for the period of one year from the first trading date. Upon the expiry of 6 months period of

the prescribed time, those shareholders will be allowed to sell 25% of the total number of shares prohibited for

sale and the remaining after one year.

Relaxation

– None –

Others (if any)

–None –

48

Statistical Summary

Banpu Power Public Company Limited and its Subsidiaries

Accounting Period

Total Sales

(THB mm)

Net profit

(loss)

(THB mm)

Net profit

(loss) per

share1

(THB/Share)

Dividend per

share

(THB/Share)

Book Value

per share

(THB/Share)

Dividend

Payout Ratio

(Percent)

BCDJ 6,223.7 2,627.7 3.0 - 21.80 -

BCDH 5,826.1 2,997.4 3.5 4.0 22.86 115.1

2015 6,217.0 2,923.4 2.5 4.02 8.84 116.1

The six-month period ended 30 June 2016

3,173.0 2,632.7 1.23 - 10.20 -

Note: 1 Net profit per share for the years 2013 and 2014 are calculated based on a weighted average of 602.2 million ordinary

shares. Net profit per share for the year 2015 is calculated based on a weighted average of 842.1 million ordinary

shares.

2On April 27, 2015, our Board of Directors declared dividend at the rate of THB4.0 per share while the Company had a

total of 602.2 million ordinary shares issued.

3Net profit per share for the six months ended June 30, 2016, is calculated based on a weighted average of 2,113.1

millionordinary shares.

The meeting of the Company’s board of directors No. 8/2559 held on August 25, 2016, having

considered our results of operations and other financial factors, resolved to approve the declaration of interim

dividend of THB0.67 per share, totaling THB 1,606.1 million, accounting for 61.00 percent of net profit for the six-

month period ended June 30, 2016. As of the time of the dividend declaration, the Company had a total of

2,397.2 million ordinary shares issued and outstanding. On September 13, 2016, the Company paid the dividend

by way of a short-term loan from Banpu. As of September 21, 2016, the Company had THB 13,716.6 million of

outstanding short-term loans from Banpu. In addition, the dividend payment will decrease unappropriated retained

earnings and total shareholders’ equity at equal amount. (In this regard, this has not been included the increase

in shareholders’ equity from the increase in accumulated profit incurred during the periods)

49

Banpu Power Public Company Limited

Statement of Financial Position


As at December 31 As at June 'A

2013 2014 2015 2016

THB mm % THB mm % THB mm % THB mm %

Assets

Current assets

Cash and cash equivalents 690.6 3.6 766.9 3.7 1,159.6 4.0 2,584.8 6.7

Restricted deposits at financial institutions 123.5 0.6 - - 18.1 0.1 7.3 0.0

Short-term investments 505.9 2.6 1,004.1 4.8 1,775.6 6.1 238.2 0.6

Trade accounts receivable and notes receivable 1,177.0 6.1 1,752.0 8.4 1,169.9 4.0 1,032.9 2.7

Amounts due from related parties 13.3 0.0 11.1 0.1 7.3 0.0 17.9 0.0

Current portion of dividend receivables from

related parties 1,900.0 9.9 1,500.0 7.2 1,446.4 5.0 1,602.1 4.1

Advances to related parties 15.2 0.1 21.0 0.1 26.9 0.1 17.0 0.0

Short-term loans to related parties - - 115.4 0.6 185.5 0.6 250.6 0.6

Short-term loan to other companies - - 70.0 0.3 - - 1,104.3 2.9

Fuel 692.6 3.6 608.3 2.9 355.5 1.2 301.4 0.8

Spare parts and supplies 49.8 0.3 51.1 0.2 52.7 0.2 47.6 0.1

Other current assets 62.9 0.3 65.5 0.3 135.4 0.5 156.3 0.4

Total current assets 5,230.6 27.3 5,965.5 28.6 6,332.9 21.7 7,360.34 19.0

50



2013 2014 2015 2016


Non-current assets

Dividend receivables from related parties 5,182.3 27.0 5,655.4 27.1 6,043.5 20.7 6,334.1 16.4

Advances to related parties - - - - 260.3 0.9 718.0 1.9

Investments in joint ventures 2,318.6 12.1 2,655.2 12.7 8,823.9 30.2 16,445.9 42.5

Other investments, net 74.2 0.4 93.1 0.4 220.6 0.8 268.2 0.7

Building and equipment, net 5,346.5 27.9 5,353.5 25.7 5,913.0 20.3 5,775.9 14.9

Deferred income tax assets, net 644.5 3.4 688.5 3.3 770.0 2.6 842.4 2.2

Goodwill 41.6 0.2 41.8 0.2 58.5 0.2 48.9 0.1

Other non-current assets 345.3 1.8 414.1 2.0 777.1 2.7 875.6 2.3

Total non-current assets 13,953.1 72.7 14,901.6 71.4 22,866.9 78.3 31,309.0 81.0

Total assets 19,183.7 100.0 20,867.1 100.0 29,199.8 100.0 38,669.3 100.0

Liabilities and shareholders’ equity

Current liabilities

Short-term loans from financial institutions 609.2 3.2 636.5 3.1 449.6 1.5 168.1 0.4

Trade accounts payable and notes payable 423.2 2.2 71.6 0.3 309.1 1.1 318.1 0.8

Advances from and amounts due to related

parties 37.3 0.2 50.7 0.2 55.4 0.2 40.8 0.1

Short-term loans from related parties 1.5 0.0 60.0 0.3 14,882.8 51.0 12,166.2 31.5

Short-term loans from other company 56.1 0.3 56.2 0.3 - - 2.8 0.0

Dividends payable 3,801.1 19.8 4,322.0 20.7 - - - -

Current portion of long-term loans from financial

institutions - - 9.9 0.0 39.7 0.1 35.2 0.1

Income tax payable 115.4 0.6 83.9 0.4 129.4 0.4 31.4 0.1

Other current liabilities 930.5 4.9 1,477.2 7.1 1,609.6 5.5 1,215.0 3.1

51



2013 2014 2015 2016


Total current liabilities 5,974.2 31.1 6,768.0 32.4 17,475.6 59.8 13,977.7 36.1

Non-current liabilities

Long-term loans from financial institutions, net - - 204.4 1.0 173.2 0.6 140.7 0.4

Deferred tax liabilities, net 54.9 0.3 119.5 0.6 55.8 0.2 69.1 0.2

Employee benefits obligation 26.0 0.1 9.3 0.0 25.6 0.1 27.1 0.1

Total non-current liabilities 80.9 0.4 333.1 1.6 254.6 0.9 237.0 0.6

Total liabilities 6,055.1 31.6 7,101.1 34.0 17,730.2 60.7 14,214.6 36.8

Shareholders’ equity

Share capital

Registered share capital 6,022.0 6,022.0 19,956.9 30,956.9

Issued and paid-up share capital 6,022.0 31.4 6,022.0 28.9 12,972.0 44.4 23,972.0 62.0

Premium on share capital 307.9 1.6 307.9 1.5 307.9 1.1 307.9 0.8

Surplus from business combination under

common control - - - - (1,978.6) (6.8) (1,978.6) (5.1)

Retained earnings (deficits)

Appropriated Legal reserve 602.2 3.1 602.2 2.9 602.2 2.1 602.2 1.6

Unappropriated 577.3 3.0 276.1 1.3 (58.1) (0.2) 2,488.2 6.4

Other components of shareholders’ equity (1,714.6) (8.9) (1,706.2) (8.2) (1,000.2) (3.4) (1,608.5) (4.2)

Total parent’s shareholders’ equity 5,794.8 30.2 5,501.9 26.4 10,845.2 37.1 23,783.2 61.5

Non-controlling interests 7,333.8 38.2 8,264.0 39.6 624.4 2.1 671.5 1.7

Total shareholders’ equity 13,128.6 68.4 13,766.0 66.0 11,469.6 39.3 24,454.7 63.2

Total liabilities and shareholders’ equity 19,183.7 100.0 20,867.1 100.0 29,199.8 100.0 38,669.3 100.0

52


Statement of Comprehensive Income

Statement of Comprehensive income

For the year ended December 31 For six-month ended June 30

2013 2014 2015 2015 2016

THB mm % THB mm % THB mm % THB mm % THB mm %

Revenues

Sales 5,689.1 91.4 5,199.7 89.2 5,653.0 90.9 2,727.8 89.7 2,814.4 88.7

Dividend income from other companies 0.4 0.0 2.1 0.0 4.3 0.1 0.6 0.0 9.3 0.3

Interest income 22.2 0.4 27.8 0.5 55.5 0.9 28.1 0.9 54.7 1.7

Management fees and others 512.0 8.2 596.5 10.2 504.2 8.1 BOJ.B 9.3 294.6 9.3

Total revenues 6,223.7 100.0 5,826.1 100.0 6,217.0 100.0 3,039.6 100.0 3,173.0 100.0

Expenses

Cost of sales 4,293.7 69.0 3,686.6 63.3 3,586.3 57.7 1,756.7 57.8 1,608.8 50.7

Administrative expenses

731.4 11.8 856.0 14.7 826.1 13.3 355.0 11.7 416.8 13.1

Net gains (losses) on exchange rate (36.5) (0.6) 7.9 0.1 0.7 0.0 (3.2) (0.1) (118.9) (3.7)

Total expenses 4,988.6 80.2 4,550.4 78.1 4,413.1 71.0 2,108.5 69.4 1,906.7 60.1

Share of profit from joint ventures 1,819.5 29.2 2,158.5 37.0 1,895.2 30.5 925.6 30.5 1,833.1 57.8

Profit (loss) before finance cost and income tax expenses 3,054.6 49.1 3,434.2 58.9 3,699.1 59.5 1,856.7 61.1 3,099.4 97.7

Interest expenses 41.6 0.7 26.3 0.5 221.1 3.6 21.8 0.7 238.7 7.5

Profit (loss) before income tax expenses 3,012.9 48.4 3,407.9 58.5 3,478.0 55.9 1,834.8 60.4 2,860.7 90.2

Income tax expenses 385.2 6.2 410.5 7.0 554.6 8.9 274.7 9.0 228.0 7.2

Profit (loss) for the period 2,627.7 42.2 2,997.4 51.4 2,923.4 47.0 1,560.1 51.3 2,632.7 83.0

53

Statement of Comprehensive income

For the year ended December 31 For six-month ended June 30

2013 2014 2015 2015 2016

THB mm THB mm THB mm THB mm THB mm Other comprehensive income (expense), net after taxes:

Remeasurements of post-employment benefit obligations - 15.7 - - -

Comprehensive expense of joint ventures - - - - (9.1)

Gain (losses)on remeasuring on available-for-sale investments (15.6) 15.1 (4.0) (4.0) -

Comprehensive income (expense) from a joint venture 505.2 (7.0) N94.2 211.5 (212.8)

Exchange differences on translating financial information 679.0 24.2 461.0 379.8 (425.8)

Other comprehensive income (expense) for the period, net of taxes 1,168.6 47.9 1,251.2 587.3 (647.7)

Total comprehensive income (expense) for the period 3,796.3 3,045.3 4,174.6 2,147.4 1,985.0

Attributable to:

Owners of the parent 1,786.7 2,091.9 2,074.6 902.6 2,555.4

Non-controlling interests 841.0 905.5 848.8 657.5 77.3

Profit (loss) for the period 2,627.7 2,997.4 2,923.4 1,560.1 2,632.7

Total comprehensive income (expense) attributable to:

Owners of the parent 2,276.3 2,115.9 2,780.6 1,104.9 1,938.0

Non-controlling interests 1,520.0 929.4 1,394.0 1,042.5 47.1

Total comprehensive income (expense) for the period 3,796.3 3,045.3 4,174.6 2,147.4 1,985.0

Earnings (losses) per share

Basic earnings (losses) per share (Baht) 3.0 3.5 2.5 1.5 1.2

Weighted average number of ordinary sharesat Par Value of THB 10 (Million shares) 602.2 602.2 842.1 602.2 2,113.1

54


Statementof Cash Flows

Statement of Cash Flows

For the year ended

December 31

For six-month ended

June 30

2013 2014 2015 2015 2016

THB mm THB mm THB mm THB mm THB mm Net cash receipts (payment) from

operating activities

1,638.6 817.8 2,351.0 1,702.7 220.8

Net cash receipts (payment) from

investing activities 1,935.3 795.0 (6,036.7) (1,157.8) (6,717.5)

Net cash receipts (payment) from

financing activities (3,526.4) (1,507.3) 4,063.4 (301.0) 7,983.4

Net increase in cash and cash

equivalents 47.5 105.5 377.8 243.9 1,486.6

Exchange differences on cash and cash

equivalents 88.9 (29.1) 14.9 58.9 (61.5)

Cash and cash equivalents at

beginning of the period 554.1 690.6 766.9 767.0 1,159.6

Cash and cash equivalents at end of

the period 690.6 766.9 1,159.6 1,069.7 2,584.8

Prepared by Bualuang Securities Public Company Limited

Thanachart Securities Public Company Limited

The Quant Group Company Limited

55

The Company hereby certifies that the information reported in this information memorandum is correct.


(Mr. Akaraphong Dayananda) (Mr. Voravudhi Linananda)

Director Director

information memorandum – banpu power public company ......as of september 2016, the compnay has a...

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