noble 05

Message from the Chairman

01 Financial Highlights

02 Company Structure

03 Company Overview

05 Noble Development Projects

08 Revenues Structure

09 Industrial Situation and Trend

12 Risk Factors

15 Shareholders

16 Organization Chart

17 The Board of Directors

19 The Audit Committee

20 The Executives

21 Election of the Board of Directors and Remuneration

22 Board of Directors, Audit Committee

and Executive officers

28 Corporate Governance

32 The Audit Committee's Report

33 Charts of Operating Performance

and Revenue Structure

35 Analysis of Financial Status and Operating Results

36 Remunerations for External Auditor

37 Company Factsheet

Auditor's Report 39

Consolidated and Company Balance Sheets 40

Consolidated and Company Statements of Income 42

Consolidated and Company Statements of Changes in 43

Shareholders' Equity

Consolidated and Company Statements of Cash Flows 45

Notes to the Consolidated and Company Financial 46

Statements

CONTENT

Annual Report 2005 Noble Development Public Company Limited

In 2005, despite of negative factors, such as

fuel prices and increasing interest rates, the

performance of Noble Development Public

Company Limited still grew prominently both

in term of income and profit. The company

had total sales of THB 2,506 million and net

profit of THB 456 million, a 36% increase

from 2004.

The increase in revenue and profit was a

result of the success in projects selling,

effective management and efficient expense

control. Apart from the revenue and profit

that reflected the successful business

administration, the company has prepared

itself for future project development by

investing more in assets on the potential

locations. The investment is planned to be in

line with the projection of the profit which is

expected to expand at 15-20% per year.

In 2006, we are confident that the real estate

market will continue its stable and long-term

expansion according to the real demand and

the investment in infrastructure development

in order to promote Thailand as the

investment center of the region. In 2006, we

plan to launch at least 4 projects, both in

single detached houses and condominiums,

which value over THB 3,600 million.

Finally, Noble Development Public Company

Limited would like to thank our shareholders

for their support, which has been vital to our

strength and capacity for constant growth.

We, at Noble Development, will strictly,

carefully, efficiently and transparently hold

on to our policies in business administration

and capital on according to our corporate

governance value. At the same time, we will

continually create more innovation for a

different lifestyle as we are bound to our

philosophy and commitment.

Mr. Kitti Thanakitamnuay

Chairman and Managing Director

Message from the chairman


Unit : Million Baht

2005 2004 2003

Operating Performance

Revenue from Property Development Business 2,458 1,770 3,087

Revenue from Department Store Business 48 - -

Total Revenues 2,528 1,817 3,168

Gross Profit from Property Development Business 972 705 991

Gross Profit from Department Store Business 22 - -

Net Profit‘ 456 335 747

Financial Status

Total Assets 5,363 5,287 4,584

Total Liabilities 2,474 2,761 2,201

Issued and Paid-up Share Capital 2,282 2,282 2,282

Shareholders' Equity 2,889 2,526 2,383

Financial Ratios

Gross Profit Margin from Property Development

Business 39.53 39.82 32.09

Gross Profit Margin from Department

Business 46.44 - -

Net Profit Margin 18.05 18.41 23.58

Return on Assets 8.57 6.78 20.32

Return on Equity 15.80 13.25 31.36

Debt to Equity Ratio 0.86 1.09 0.92

Net Debt to Equity Ratio 0.69 0.86 0.44

Book Value per Share (Baht) 6.33 5.53 5.22

Earning per Share (Baht) 1.00 0.73 1.64

Financial Highlights


01

Company Structure

Noble Development Public Co., Ltd.

Paid-up Capital THB 2,282.36 Million

Type of Business : Property Development

and Housing Construction

ë Ban Suk Sabai Co., Ltd.

Paid-up Capital THB 2 Million

Type of Business : Property Development and Housing

Construction

ë S&P Property Management Co., Ltd.


Type of Business : Housing Construction and Property

Management

ë Continental City Co., Ltd.


Type of Business : Property Development

ë Playground Store Co.,Ltd


Type of Business : Department Store

ë Research & Consultant Co., Ltd.


Type of Business : Housing Construction

ë N.K. Energy Conservation Co.,Ltd.

Paid-up Capital THB 6.5 Million

Type of Business : Light Weight Wall Panel

100%

100%

85%

65%

50%

100%


02

Type of Business

The core business of Noble Development

Public company Limited and its subsidiaries

is property development, being composed

of various types of residential projects such

as single detached houses, low rise and

high rise condominiums. In addition, the

company creates and offers the residential

innovation to satisfy the customers' desire

for the uniqueness and distinctive living.

Up till now, the company has launched 22

projects, where 8 of those projects with the

total value of THB 4,877 million were

developed and launched before year 2002.

The rest of them were launched during year

2002 and 2004 with the total value of THB

11,111 million, consisting of single detached

house, condominium, townhouse, and

landplot. The single detached house

projects were Noble Tara Ekamai - Rama 9,

Noble Tara Ngamwongwan, Noble Tara

Pattanakarn, Noble Wana Pinklao, Noble

Wana Watcharapol, Noble Anawana Pinklao,

Noble Geo Watcharapol, and Noble Geo

Rama 5. The condominium projects were

Noble Ora Thonglor, Noble Lite, and Noble

09. Finally, the townhouse and landplot were

First Home and Noble Sathorn Thapra.

In the year 2005, the company launched

Noble Tara Ngamwongwan 2, single

detached house project, with the total value

of 903 million baht. Besides the residential

project the company proudly presented

"Playground" under the concept of

inspiration store. "Playground" is not just a

shopping center; it inspires new modern

lifestyle through fashions, designs, home

decorations, music, books and arts.

"Playground" is located in the middle of Soi

Thonglor, one of the best locations in

Bangkok. Thus, it is the pilot project

developed to be the source of recurring

income for the company in the long run. In

the year 2006, the company plans to launch

another 4 new projects, 3 projects of

downtown condominiums and 1 project of

single detached house, with the total value

of more than THB 3,600 million.

Housing construction is another core

business of the Company. The Company

also expanded into the related business

such as turnkey property management

services, property services after transfer of

ownership, asset or debt management service

offer to investors, financial institutions or

asset management companies.

Company Overview


03

Numbers of issued

and paid up

Company/Address Type of Business Project shares

1. Ban Suk Sabai Company Limited

19th Fl., Tonson Tower, 900 Ploenchit Rd., Property Development Noble Park

Lumpini, Pathumwan, Bangkok and Housing Construction Noble Tara Ngamwongwan 2 20,000

2. S&P Property Management Company Limited

19th Fl., Tonson Tower, 900 Ploenchit Rd., Housing Construction

Lumpini, Pathumwan, Bangkok and Property Management Noble Neo City 20,000

3. Continental City Company Limited

19th Fl., Tonson Tower, 900 Ploenchit Rd., The Noble

Lumpini, Pathumwan, Bangkok Property Development Noble Sukhumvit 36 4,400,000

4. Playground Store Company Limited

946/4 Soi Sukhumvit 55, Sukhumvit Rd.,

Klongton Nue, Wattana, Bangkok Department Store Playground Store 250,000

5. Research and Consultant Company Limited

19th Fl., Tonson Tower, 900 Ploenchit Rd., Noble Choice Pinklao

Lumpini, Pathumwan, Bangkok Housing Construction Noble Choice Vibhavadee 100,000

6. N.K.Energy Conservation Company Limited

54/4 Moo 7, Bang Saothong, Light Weight Noble Choice Pinklao

Samutprakarn Wall Panel Noble Choice Vibhavadee 6,500

The subsidiary companies are set to develop, operate or manage the projects as follows.

Company Overview (Continued)


04

Every Noble Development project is a

reflection of the creativity and the conviction

of Noble. The mind-set to create innovation

to satisfy needs and enhance quality of life

which bring happiness to homeowners

beyond their expectations are all the

Noble's mission.

Besides the residential projects, Noble also

offers distinctive living with design by

launching 'Playground', the inspiration store

where the modern happiness can be

inspired. The following are part of the

Company's pride and success

Projects developed and launched before 2002

Noble Park Project

Noble Park was unveiled in December 1991

as the first horizontal condominium in

Thailand. The concept of a "Condo house"

combines the benefits of living as part of a

community and the precepts of condominium

residence to the familiar features of Thai

ways of living within the development.

Noble Home Project

Noble Home comprises single dwelling

houses with architectural designs aimed to

give a different perspective and individuality

including the curved roof, all of which

enhanced quality and offered more useable

floor space than the average home. The

project launched in August 1992.

Noble Neo City Project

Noble Neo City is the visual proof of the

innovation development that is taking place

within Noble. Here, the concept of a life of

freedom is catered to. Owners can expand

living space within their detached homes in

four different steps. They can start with 2

floors 2 bedrooms and, if so wish, they can

later add to that and end up with 3 floors 5

bedrooms.

The Noble Project

Prestigious detached residences comparable

to a contemporary art form. Built right in the

art of Bangkok, The Noble has been

designed to offer maximum floor space,

resulting in practicality and privacy. The

design concept also brings the green-ness

of the garden right into the home.

Noble House Phayathai Project

Noble's high-rise residential development

with 30 storey tower located in central

business district, special design offer

convenience in terms of commuting and

amenities for today's lifestyle. The project

consists of 300 residential units and

commercial area.

Noble Choice Project

Noble Choice is the innovation from Noble

Development, one spawned from the

marriage of state-of-the-art technology and

an old-fashioned commitment to service.

The success of Noble Choice is evident

from all of our satisfied customers who have

exercised their freedom of choice to

express a wide variety of contemporary

lifestyles, all of whom were delighted

beyond their expectations. Durable yet

flexible, Noble Steel Tech has a proven

track record of success overseas where it

has been utilized for more than a decade.

Noble Choice projects are located in two

different areas -- Noble Choice Pinklao and

Noble Choice Vibhavadee.

Noble Development Projects


05

Noble House Ruamrudee Project

Possibly occupying the best location in

Bangkok, the key concepts behind this

development are privacy and peace. Hence,

there is a total of only 23 units designed to

give maximum space for the families of

those executives who are looking for

minimum in convenience what traveling.

Projects launched since 2002

Noble Tara Ekamai - Rama 9 / Noble Tara Ngamwongwan / Noble Tara Pattanakarn / Noble Tara Ngamwongwan 2 Project

"Tara" means "stream" which implies the

concept of the project to bring peace of

recreation with tall fences covered by floras

surrounding the project to maximize the

enjoyment from nature together with the

private swimming pool. The Noble's

differentiated concept of C-shape housing

keeps every corner of the house close to

nature surrounding. The projects are in the

best location according to the concept of

"Special privacy in the city center", which

located on Rama 9, Ngamwongwan and

Pattanakarn.

Noble Wana Pinklao / Noble Wana Watcharapol Project

The concept of this project is to bring resort

feeling to the home, which can be presented

in its name: "Wana" means "Forest". This is

a place to take a rest with nature everyday.

Every living space links with nature, both

view and sensibility by balancing oriental

and western philosophy. The project is

unique from others in the market with the

clubhouse and swimming pool decorated to

maximize the privacy. Two Wana projects

are Noble Wana Pinklao and Noble Wana

Watcharapol.

Noble Ana Wana Pinklao Project

Noble Ana Wana Pinklao builds on the

success of the previous Noble Wana Pinklao

project. Utilizing the popular Wana design on

the same Pinklao site, this new development

offers a resort-style living experience 365

days a year. Each house has a plot of 100

square wah or more to give each resident

that much more exposure to the area's

natural charms.

Noble Satorn Thapra Project

Noble Satorn Thapra is a project with a very

different approach to modern housing. Plots

varying in size from 78 to 168 square wah

offer havens of security and serenity in small

communities served by common facilities.

Customers who wish to design their own

homes are given every help and

encouragement in selecting the concepts

and details that they and their families

prefer.

Noble Ora Thonglor Project

Noble Ora Condominium comprises two 21-

storey condominium towers of 223 units

altogether at one of Bangkok's prime

locations, the center of Soi Thonglor. The

project has 60's design that provides

Condominium facilities but feeling of

spacious single house from the large floor-

to-ceiling and a tropical style swimming

pool.

Noble Geo Watcharapol / Noble Geo Rama 5 Project

Noble Geo is designed under the Planning &

Function concept to enable free-style

arrangement of furniture. The box-shape

houses maximize useable area, larger living

room and bedroom. The beautiful natural

landscape lawns and gardens can be

accessible from every angle of the houses,

located in Watcharapol and Rama 5.

First Home Project

First Home is a townhouse project under the

strategies to expand the market base to

cover all tiers of customers, located near the

city but economical pricing. The project

consists of 2-storey townhouses and 3-

storey commercial units, located in Soi

Watcharapol.


06

Noble Development Projects (Continued)

Noble 09 Project

Noble 09 is a luxurious condominium

located in Soi Ruamrudee, only 100 meters

away from the Ploenchit BTS station, gives

a cozy feeling in modern style. Designed to

have serene beige color elegantly combined

with naturally formed stone, it goes up to 8

floors and provides more open area with its

two towers. Enjoy total privacy with only

three units per floor, and spacious interior

benefited from airy floor-to-ceiling glass

windows.

Noble Lite Project

Near Aree BTS Station, Noble Lite is located

only 150 meters from business center on

Phaholyothin Road. With Crash-Pads

concept - living near BTS route with no red

lights traffic to spare up hours for pleasure

and relaxation. The project offers 24 storeys

with one to three bedrooms. Each unit is

designed for multi purpose activities. The

project also provides facilities area, fitness

and a swimming pool.

Playground Store

Playground is not just a department store,

but an "inspiration store", the place for

unlimited happiness in the heart of Soi

Thonglor, stylish location. With over 3,000

square metres, Playground is a new lifestyle

that is not only a shopping place, but also a

huge living room where the customers can

fulfill their lives with new experiences.

Inspiration and creativity have been brought

through design and lifestyle products;

fashion, clothing and accessories, home

decorations, music, Thailand's most provided

magazines and books featuring design and

lifestyles. The space also consists of

restaurants, and Play Gallery to differentiate

the new frontier with art.

Projects launched in 2006

Noble Ambiance Ruamrudee

It is the condominium for the perfect urban

relaxation in Soi Ruamrudee. Noble

Ambiance Ruamrudee offers the peaceful

privacy surrounded by various moods. The

project composes of 2 eight-storey building

with Perfect Contrast architecture. The

exterior is designed to be simple but exciting

and amusing with color of the buildings,

whereas the interior is designed for

spaciousness and airiness with tall glasses

from the ceiling to the floor, allowing the

natural touches in.

Noble Ambiance Sarasin

This project is a dream-comes-true for

Bangkokians. Relax with the natural touch

from Lumpini Park which is just across the

street while enjoying the HIP life of the Lang

Suan area. The eight-storey building is the

combination between functions and design.

Spaciousness and airiness from single-load

corridors in every storey allows private

views in harmonious with the inner-court

ambiance surrounded by beautiful gardens,

pools and gyms.

Noble Ambiance Ruamrudee and Noble

Ambiance Sarasin will be officially launched

together in March 2006.

Noble Sukhumwit 36

The project is the answer for a different kind

of lifestyle. This 35-storey building

composes of a 29-storey condominium, a

modern shopping mall, and an office space.

It is the condominium for people who love

the freedom and the excitement of the

urban beat. The 1st to the 4th floors and the

"Inspiration store" will be another Bangkok's

modern shopping center with many leading

shops and offices. Its offers conveniences

from the transportation via BTS sky train

and the facilities along Sukhumwit 36 road.

Noble Geo Watcharapol 2

The project is developed as a result of the

immense success of Noble Geo Watcharapol,

the project under the concept of Planning &

Function. Noble Geo Watcharapol allows its

residents freedom of choices with the

freestyle furniture layout. In addition, every

house is equally comfortable regardless of

sizes because the Box-shape design has cut

off unnecessary components such as walls

between common rooms. Thus, the result is

a spacious house with more space for living

rooms and bedrooms. The project is expected

to be launched in the second quarter of

2006.


07

Noble Development Projects (Continued)

Revenues Structure Operated by(1) % Shares 2005 2004 2003

holding Value % Value % Value %

Revenue from Real Estate

Development

Single Detached House and Land NOBLE - 1,142.14 45.18 1,297.66 71.40 2,150.53 67.88

WPV(3) - - - - - 169.00 5.33

BSS 100% 144.25 5.71 - - 36.16 1.14

Condominium NOBLE - 1,171.39 46.33 380.11 20.92 - -

WPV(3) - - - - - 1.45 0.05

WT(3) - - - - - - -

Condo House NOBLE - - - - - 1.94 0.06

Townhouse and Shop house NOBLE - - - 41.60 2.29 383.09 12.09

Total Revenue from Real

Estate Development 2,457.78 97.22 1,719.37 94.61 2,742.17 86.55

Revenue from Construction

Services

Detached House NOBLE - 0.04 0.00 47.84 2.63 345.05 10.89

S&P 100% 0.06 0.00 3.01 0.16 - -

Total Revenue from

Construction Services 0.10 0.00 50.85 2.79 345.05 10.89

Revenue from Department Store

Sales PG 85% 35.85 1.42 - - - -

Rental and Services PG 85% 12.17 0.48 - - - -

Total Revenue from Department Store 48.02 1.90 - - - -

Total Revenue from Core Businesses 2,505.90 99.12 1,770.22 97.40 3,087.22 97.44

Other Revenues

Gain on Sales of Investments in

Subsidiaries and Associate, net NOBLE - - - - - 22.61 0.71

Gain on Foreign Currency Exchange NOBLE - - - 26.99 1.49 18.12 0.57

Interest Income (2) - 15.94 0.63 12.76 0.70 16.37 0.52

Others Income (2) - 6.20 0.25 7.43 0.41 24.03 0.76

Total Other Revenues 22.14 0.88 47.18 2.60 81.13 2.56

Total Revenues 2,528.04 100.00 1,817.40 100.00 3,168.35 100.00

Increase (Decrease) in Revenue

from Core Businesses 735.68 41.56 (1,317.00) (42.66) 2,037.78 194.18

Remark

(1) NOBLE = Noble Development Public Company

Limited

WPV = Wipa View Company Limited

WT = World Time Holding Company Limited

BSS = Ban Suk Sabai Company Limited

S&P = S&P Property Management Company

Limited

PG = Playground Store Company Limited

(2) Revenues of the Company and its subsidiaries.

(3) The Company disposed the investment in

subsidiaries, Wipa View Company Limited and

World Time Holding Company Limited on

September 1, 2003.

Revenues Structure


(Unit : Million Baht)

08

The Industrial Situation and Trend

In 2005, the survey on registered residential

units in Bangkok and vicinity (please see

table 1) indicated that the overall real estate

business had expanded from 2004 for 3.3%.

In 2005, the numbers of residential units

increased to 71,301 units, from 69,050 units

in 2004. The numbers of self-built units

increased for 22.5% whereas the numbers

of the developer-built decreased for 9.7%.

At the same time, the numbers of condominium

projects increased for 20.5%. These were

the result of continually-increasing interest

rates and fuel price which affected the operation

costs and drove the overall dwelling prices

up. The prices per unit became a key factor

and strategy in project development for the

developers. Moreover, customers' behavior

in choosing residential places tended to be

more focused on transportation expense

and convenience. Additionally, though the

purchasing power of the customers remained

the same, the house prices increased. Thus,

customers had switched to condominiums in

the inner city which offered the lower price

per unit than houses.

Furthermore, the numbers of registered

residential units built by developers that

decreased in 2005 had reflected to less

competition between them. As we had

mentioned, the impact from fuel prices and

increasing interest rates drove the cost up.

At the same time, financial institutes had

restricted their financing loan for project

development. In addition, at present,

confidence in qualities and developers

became a key decision factor in buying

house for customers. Thus, this drove some

small developers who were not competitive

both in term of marketing and financial

status out of the market.

2000 2001 2002 2003 2004 2005 2005(2)

(Jan-Sep)

Developer-Built

Single House, Twin House,

Townhouse, Shop House 6,331 9,691 14,371 30,088 40,752 27,600 36,800

Condominium 6,679 4,650 5,118 7,399 8,439 7,629 10,172

Total Developer-Built 13,010 14,341 19,489 37,487 49,191 35,229 46,972

Self-Built 18,064 19,639 17,693 18,598 19,859 18,247 24,329

Total Residential Units

Registered 31,074 33,980 37,182 56,085 69,050 53,476 71,301

Change from Last Year (%) 7.1% 9.4% 9.4% 50.8% 23.1% 13.8%(1) 3.3%

Table 1 : Residential units registered in Bangkok Metropolis and Vicinity.

Source : Real Estate Information Center

Remark : (1) Compared to the data from Jan-Sep 2004

(2) Pro-rata based on Jan-Sep 2005


09

The Industrial Situation and Trend (Continued)

In 2005, despite of several negative factors

such as the slow down of the world's

economy, interest rate situation, inflation,

and political uncertainty, many organizations

and institutions have forecasted that in

2006, the overall Thailand's economy (marked

by the GDP) is likely to expand at a similar

rate to 2005 which is between 4.0-4.5%. The

real estate sector is expected to expand in

the same direction with the national economic

growth with the following supporting factors:

The government's investment in infrastructure development

The government had announced their plan

for Mega Projects investment, worth around

THB 1.8 trillion. The investment plan aims to

distribute income to business sectors and

citizens, and that positively affects

consumers' demand and purchasing power.

This investment also increases land's value

and potential which are the key success

factors for real estate developers. The

government's investment thus substantially

promotes the real estate development

business in both short and long terms.

Interest rates

As a result of the rising US Fed Fund

interest rate, the pressure from fuel price

and domestic inflation, Bank of Thailand has

raised its Policy Interest rate by 2% in 2005.

For 2006, it is expected that the situation

will be relieved, since The US Fed Fund

restricted interest rate policy is expected to

increase only by 0.5 - 0.75%, in comparison

with 3% increase in 2005. The fuel prices

seem to maintain itself at the same level or

to increase gently, unlike the situation in the

past 2 years. Thus, the domestic interest

rates are expected to grow in the

decreasing rate. Nevertheless, the rates are

still considered relatively low compared to

the past (please see Chart 1) and the

concern over the rise of interest rates also

helps accelerate customers with real

demand for houses to make their decision

faster.

Chart 1: Minimum Lending Rate (MLR) of Commercial banks during the year 1996-2005

Source : Bank of Thailand

Remark : Average MLR of 5 commercial banks BBL, KBANK, BAY, KTB and SCB

18.00

16.00

14.00

12.00

10.00

8.00

6.00

4.00

2.00

96

MLR (At the end of the Year)

MLR

MLR (Average during the Year)

97 98 99 00 01 02 03 04 05

13.55 14.65

9.26

13.72

8.077.44

7.056.14

5.69 5.9113.20

15.25

11.75

8.40 7.85 7.20 6.755.70 5.70

6.55


10

Measure to promote second-handed houses

The government's measure to promote

second-handed houses by reducing the

transfer fee and the mortgage fee to 0.01%

each, which is effective from the year-end of

2005 to end of 2007. This not only

encourages the purchasing power in the

second-handed house market, but also

helps to boost the liquidity in real estate

sector, because the easier customers can

sell their current residential places, the

faster they can make decision for their new

ones.

Foreign Investment

Foreign investors have become more

interested in investing in Thai real estate

business, as a result of the government's

infrastructure and transportation network

development plans. These plans enhanced

the potential and the land prices which were

not attractive to foreign investors before.

Additionally, the measures to promote free

trade and investment allow them to see the

opportunities for investment and profit from

rising in land prices. The foreign investment,

in forms of joint venture with Thai companies,

direct investment, the investment via the

stock market, or any kind of financial

support, not only encourages the liquidity in

the market, but also promotes the long-term

development for real estate sector.

In conclusion, regardless the political

uncertainty, the real estate business in 2006

tends to expand and grow with stability.

Only the developers who sustain their

quality and potential can compete in this

business. For Noble, with our distinctive and

strong competitive and marketing strategies,

readiness and potential in terms of capital,

properties for project development, as well

as disciplined and efficient administration

and capital management, we are stable and

strong in both financial and marketing position

and ready to expand with sustainability to

create and develop quality of residential

projects, as well as to return profits to

shareholders and investors as aimed.


The Industrial Situation and Trend (Continued)

11

Risk Factors

Chart 1 : index of construction material prices and the change of the index of construction material

Source : Bureau of Trade and Economic Indices, Office of the Permanent Secretary Ministry of Commerce ,

Ministry of Commerce

Remark : Base on 2000 A.D = 100

In 2006, another factor that might affect the

price of construction material is government

Mega Projects. The government planned to

invest THB 290 billion in 2006, from the total

investment budget of THB 1.8 trillion. That

would cause the rising demand of construction

materials and a temporary shortage of the

materials, and eventually result in the increase

of construction material prices. However, the

Mega Projects are a long-term investment

plan, so the government announced the plan

in advance in 2004 to ensure that all related

parties in both government and private sectors

have preparation and management planning

in order to achieve highest efficiency.

Consequently, the effect of construction

shortage is well relieved.

The risk factors that may affect the Company's

operation are :

The Risk in terms of Construction Material

Prices

According to Chart 1 that shows index of

construction material prices and the change

of the index, we can see that the construction

prices in 2005 have been increased to 20 %

higher than in 2002. Construction material

prices had begun to rise since 2003 by 8 %

because developers accelerated the

construction to obtain the benefit of the

government's tax measure ending in the

year. The prices had continued to increase

until 2004 because of the sharp rise of

petrol price. However, in 2005, construction

material prices did not increase but began

to stabilize at the same level as 2004 prices.

130.0

110.0

90.0

70.0

50.0

16

12

8

4

0 2000 2001 2002 2003 2004 2005

Index Change (%)

100.0

0.0

103.9

3.9

104.8

0.9

112.8

124.3 124.3

0.0

11.5

8.0


Index of construction

material prices

Change of the index of

construction material (%)

12

Risk Factors (Continued)

If political uncertainty continues, Mega

Project investment might be postponed.

That will affect Thai economy in a long term

because the government's investment in the

Mega Project inject the capital into the

economy, increase employment rate, also

cause the income distribution to the

business sector and to individuals. The said

project has been clearly defined to invest

more than 50% in public infrastructure,

enhancing land value and high potential

locations. This would positively affect the

economy and society, particularly in real

estate sector.

For the Company, its policy not to hold land

banks but rather to develop the land

immediately after the acquisition, and the

pre-build policy enable it to undertake

effective planning for construction. This reduces

the risks posed by construction material

shortage and the rise in construction material

prices. At the end of 2005, the Company

had pre-build houses, built at the previous

construction costs, amounted to THB 3.4

billion which are ready to immediately

transfer after customers make decisions.

The Risk in Terms of Interest Rates

Due to the raised interest rate by US Fed

Fund and inflation in 2005, Monetary Policy

Committee of the Bank of Thailand raised

the policy interest rate by 2% for the whole

year of 2005. That caused the rate of

Minimum Lending Rate (MLR) of commercial

banks to rise from 5.60 to 6.55 % (average

of five commercial banks), effected to the

developers' financing costs and customer's

burdens of loan installment.

In 2006, the Fiscal Policy Office expects that

the inflation rate should decrease from 4.5

% to 3.0 %, and petrol price is likely to

increase but in a slower rate. Kasikorn

Research Center also expects that the

interest policy of US Fed Fund should be

less strict in 2006, the interest rate would be

increased by 0.5 to 0.75%, to the height of

4.75 to 5.00%. The interest rate is likely to

be risen but in a slower rate than 2005.

Regarding its financial structure, the

Company plans to arrange project finance

only for the condominium projects in

accordance with the construction period. All

of the single detached house projects are

completely free debt. The Company's cost

structure for financing consists of 65 % of

fixed interest (at the average rate of 4.07 %)

and 35 % of floating interest. Although, the

Company has floating interest as a

component of financing cost, with the

corporate potential, those floating interest

rates offered by the financial institutions

compared to the industry are considered

low. Consequently, increasing interest rates

would not materially affect the company.

For the customer, installment burden

increases only THB 900 per month in every

0.25 % increased in an interest rate.


13

The Risk in Terms of Inventory Management

(Pre-build Houses)

Customer behavior has changed after the

financial crisis. According to research,

customers prefer buying pre-build houses

built by reliable developers rather than

buying build-to-order houses. Also, to

mange cost and time, the Company has

implemented a Pre-Build Policy for all single

detached house projects since 2002.

Currently, the Company has 350 units of

pre-build house, worth more than THB 3.4

billion, that are ready to transfer.

Although the Company has this number of

pre-build houses, the inventory cost is very

low, when compared to other developers in

the industry. The Company's gross profit

margin is 39.5 % while ratios of other

competitors in the industry are in the range

of 24.5 to 44.2 %. Moreover, the Company

does not have high risk in construction

material prices and all pre-build houses are

located in prime areas. If the Company has

to buy land in the areas to develop at

current prices, our cost would be at least 10

% higher.

Regarding the liquidity risk, the Company

has pre-build houses and ready-to-transfer

inventory that is better than having

undeveloped land banks, low liquidity and

cannot be sold and transferred to customers

immediately.

The Risk in Terms of the Political Uncertainties

The political situation has been occurred

since the end of 2005 and continued to

spread widely. If the situation does not stop

soon, it might result in violence and affect

the investment from both domestic and foreign

investors. That could impact the overall

economy of Thailand. Due to the uncertainty

and unstable political situation, investments

in all businesses are unavoidably postponed.

The Company closely monitors this situation,

as well as implements a cautious investment

policy with disciplines in business and

financial management. We only invest in

assets located in potential areas after

prudent studies on its feasibility in terms of

marketing and finance.

Risk Factors (Continued)


14

Shareholders' Name Number of Shares % of Paid up Capital

1 Thai NVDR Company Limited 72,674,300 15.92

2 Thanakitamnuay Group 36,662,296 8.03

Mr. Kitti Thanakitamnuay 36,330,919 7.96

Ban Siam Holdings Company Limited 331,377 0.07

3 CHASE C.S.CENTRAL NOMINEES LIMITED 20,425,400 4.47

4 Mr. Taveechat Jurankul 20,200,000 4.43

5 Viravan Group

Dr. Amnuay Viravan 3,664,853 0.80

Khun Ying Samornsri Viravan 8,471,850 1.86

Samvest Company Limited 4,778,265 1.05

Amvest Company Limited 2,389,131 0.52

6 Thai Strategic Asset Fund 18,750,000 4.11

7 Mr. Piya Thanakitamnuay 16,353,060 3.58

8 SOMERS (U.K.) LIMITED 12,997,700 2.85

9 Ms. Chansri Umpornsuwan 10,758,661 2.36

10 THE BANK OF NEW YORK (NOMINEES) LIMITED 10,521,400 2.30

Total 238,646,916 52.28

Shareholders

The First Ten Major Shareholders as of May 9, 2005

Dividend Policy

The company has a policy to pay dividend to shareholders by considering its' operating results

and concerned factors. The Company's dividend payout ratio is not less than 25% of the net

profit. However the said policy must be in accordance with the resolutions of shareholders'

meeting.

The Board of directors resolves to propose to the annual general shareholders' meeting held on

April 27, 2006 to approve the 2005 annual dividend payment of THB 0.27 per share or 27% of

the net profit.

Dividend policy of its subsidiaries

- None -

Investors can acquire update information of the major shareholders before the shareholders' meeting from the

website www.noblehome.com


15

Organization Chart

Board of Directors

Chairman and Managing Director

Audit Committee

ë Corporate Finance Department

ë Accounting Department

ë Finance Department

ë Legal Service Department

ë Legal Department

ë Human Resources Development Department

ë Project Operation Department 1-4

ë Investment Analyst Department

ë Marketing and PR Department

ë Information Technology Department

ë After Sales Service Department

ë Project Legal Department

Support Line CEO Office Project Operation

and Information

Technology Line

Internal Audit Line

ë Playground Store Department


16

The Board of Directors

The structure of the Company's directors consists of the followings:

ë The Board of Directors 9 persons

ë The Audit Committee 3 persons

The Board of Directors

As of December 31, 2005 the Company has 9 directors as follows.

ë Executive Directors 4 persons

ë Independent Directors 5 persons

55% of the members of the Board are Independent Director

1. Mr. Kitti Thanakitamnuay Chairman and Managing Director

2. Mr. Sitti Leelakasamelerk Director

3. Mr. Thongchai Busrapan Director

4. Miss Vasana Thieansirisak Director

5. Mr. Vicharn Busrawong Independent Director

6. Mr. Thakonkiat Viravan Independent Director

7. Mrs. Boonperm Jiamtiranat Independent Director and

Chairman of the Audit Committee

8. Mr. Narong Taychachaiwong Independent Director and

Member of the Audit Committee

9. Mr. Surachet Suboonson Independent Director and

Member of the Audit Committee

The Board of Directors' scope of duties

and responsibilities:

(1) To perform their duties cautiously and

faithfully in compliance with laws, under the

scope of the Company's objective and Articles

of Associations, together with the shareholders'

resolutions for the maximum benefits of the

shareholders.

(2) To set the Company's business plan,

strategies, goals, policies and budget together

with the Management.

(3) To supervise, monitor and assess the

Management to effectively and transparently

perform their duties in accordance with the

Company's policy and business plan.

(4) To review and ensure the efficiency of

the internal control system to ensure that

the Company's Financial Statements is

reliable, accurate and correct, and to prevent

the fraudulence in using the Company's

properties and improper transaction between

the related parties.

(5) To establish the appropriate structure of

the Board of Directors in order to create the

balance of power, adequate and appropriate

management monitoring.

17


The Board of Directors (Continued)

In 2005, the Board of Directors held 37 meetings; 10 regular meetings and 27 sub-meetings,

details of attendance is as follows:

No. of meeting attended (Times)

Regular meeting Sub-meeting*

1. Mr. Kitti Thanakitamnuay 10 27

2. Mr. Sitti Leelakasamelerk 10 27

3. Mr. Thongchai Busrapan 10 27

4. Miss Vasana Thieansirisak 10 25

5. Mr. Vicharn Busrawong 7 4

6. Mr. Thakonkiat Viravan 6 -

7. Mrs. Boonperm Jiamtiranat 8 -

8. Mr.Narong Taychachaiwong 7 -

9. Mr. Surachet Suboonson 10 25

* Sub-meetings are arranged to consider the operation issues that do not affect the Company's management

policy, e.g. the request of projects' utilities, house registration numbers, bank accounts opening etc. Thus, the

Board of Directors has assigned 5 directors composing Mr. Kitti Thanakitamnuay, Mr. Sitti Leelakasamelerk, Mr.

Thongchai Busrapan, Miss Vasana Thieansirisak, and Mr. Surachet Suboonson to attend the meetings. If any of

the 5 directors is unavailable for any meeting, the Company will invite other directors to constitute the meeting.

18


The Audit Committee

As of December 31, 2005 the Company has 3 Audit Committee as follows

1. Mrs. Boonperm Jiamtiranat Chairman of the Audit Committee

2. Mr. Narong Taychachaiwong Member of the Audit Committee

3. Mr. Surachet Suboonson Member of the Audit Committee

The Audit Committee's Secretary : Mrs. Angkana Intravichien

The Audit Committee's scope of

duties and responsibilities:

(1) To ensure the Company's financial report

is correct and reliable.

(2) To ensure the Company have adequate

and effective internal controls system, and

prepare the Audit Committees' report for

disclosure in the Company's Annual Report

and Annual Information.

(3) To consider, elect, propose the Company's

external auditor and also its fee.

(4) To review the Company's activities in

comply with the Security and Stock Exchange

regulations or the Law regarding to the

Company's business.

(5) To review and consider the Company's

information disclosure in case of the related

transaction or conflict of interest in order to

ensure the completeness and fidelity of

disclosure.

(6) To file the Audit Committee's Report on

Corporate Governance and disclose in the

Company's Annual Report and Annual

Information, the report must be signed by

the Chairman of Audit Committee.

(7) To perform other matters as assigned by

the Board of Directors under the audit

committee's considerations.

19


The Executives

As of December 31, 2005 the Company's Executives are as follows:

1. Mr. Kitti Thanakitamnuay Chairman and Managing Director

2. Mr. Sitti Leelakasamelerk Executive Vice President : Support Line

3. Mr. Thongchai Busrapan Executive Vice President : Project Operation

and Information Technology Line

4. Miss Vasana Thieansirisak Senior Vice President : Corporate Finance

Department

5. Mr. Arat Sawatatat Vice President : Project Operation Department

6. Miss Songsri Panich Vice President : Project Operation Department

7. Mr. Sira Udol Vice President : Project Operation Department

8. Mr. Manit Ngamsantiwongsa Vice President : After Sales Service Department

9. Mrs. Angkana Intravichien Vice President : Accounting and Finance

Department


20

The Company did not nominate the

committee to search for the Board of

Directors' candidates. According to the

Company's articles of association, the

Company's existing directors will propose

the candidates to the shareholders' meeting

by considering education, experience,

capability and readiness to completely

perform their duties. The shareholders'

meeting will elect the Board of Directors via

the following manners:

1. Each shareholder shall have a number of

votes equal to the number of shares held.

2. Each shareholder may exercise all the

votes he or she has (under 1) to elect one

or several persons as director or directors.

The shareholder cannot allot his or her

votes to any person in any number.

3. After the vote, the candidates shall be

ranked in order descending from the highest

number of votes received to the lowest, and

shall be appointed as directors in that order

until all of the director positions are filled.

Where the votes cast for candidates in

descending order are ties, which would

otherwise cause the number of directors to

be exceeded, the remaining appointments

shall be made by one extra vote from the

chairman of the meeting.

Regard to the Company's articles of

association, the shareholders' meeting may

pass a resolution removing any director

from office prior to retirement as a result of

the expiration of the director's term office,

by a vote of not less than three quarters of

the number of shareholders attending the

meeting who have the right to vote and who

have shares totaling not less than half of the

number of shares held by the shareholders

attending the meeting and having the right

to vote.

Remuneration for the year 2005

Remuneration in terms of money

ë Board of Directors

Remuneration for 9 directors totaled of THB

455,000 THB 55,000 for Chairman of the

Board of directors and THB 50,000 for each

director.

ë The Audit Committee

Remuneration for 3 members of the Audit

Committee totaled THB 400,000. Chairman

of the Audit Committee totaled THB 150,000

and THB 125,000 for each member.

ë Executive Officers

Remuneration for 9 executive officers, from

vice president level and upward, totaled

THB 16,666,510.

Remuneration policy for Directors and the

Management is transparently and fairly

determined on the identical and comparable

to the general practice in the industry.

Remuneration for the directors is

determined and approved by the

shareholders' meeting. To motivate as well

as to maximize interests of the Company,

the executive officers' remuneration is set to

correspond with the performance of the

Company and that of each performance's.

Other Remuneration

-None-

Election of the Board of

Directors and Remuneration


21

Board of Directors, Audit Committee

and Executive Officers

Mr.Kitti ThanakitamnuayPosition Chairman and Managing Director

Education B.A., Political Science, Chulalongkorn University

Training from Thai Institute of

Directors Association

Number of Shares 36,330,919 shares

Number of Shares Changed in 2005 No

Experience Present ë Chairman and Managing Director

Noble Development Public Company Limited

ë Managing Director

Continental City Company Limited

Research and Consultant Company Limited

Playground Store Company Limited

Ban Suk Sabai Company Limited

ë Director

Ban Siam Holdings Company Limited.

Mr. Sitti LeelakasamelerkPosition Director and Executive Vice President: Support

Education B.A., Accounting, Chulalongkorn University


Directors Association Director Accreditation Program (DAP) Class 11/2004

Number of Shares -


Experience Present ë Director






ë Executive Vice President: Support


ë Independent Director and Member of the Audit Committee

Khon Kaen Sugar Industry Public Company Limited


22

Board of Directors, Audit Committee and Executive Officers (Continued)

Mr. Thongchai BusrapanPosition Director and Executive Vice President: Project Operation

and Information Technology Line

Education Master of Science in Management SASIN Graduate

Institute of Business Administration of Chulalongkorn University



Number of Shares 20,000 Shares






N.K.Energy Conservation Company Limited



ë Executive Vice President

Project Operation Development And

Information Technology Line


Miss Vasana ThieansirisakPosition Director and Senior Vice President: Corporate Finance Department

Education Master of Science, Managerial Accounting and

Master of Science, Economic Law

Chulalongkorn University



Number of Shares -





S&P Property Management Company Limited

ë Senior Vice President: Corporate Finance Department



23

Mr. Vicharn BusrawongPosition Independent Director

Education Secondary School



Number of Shares 3,735,000 Shares


Experience Present ë Independent Director


ë Director




ë Chairman and Managing Director

Kit Porn Company Limited

World Grain Company Limited

ë Chairman

World Grain Marketing Company Limited

World People Foodstuffs Company Limited

P.T.T.N. Tharua Company Limited

World Time Company Limited

R.K.Nichigo Company Limited

W.Y. Company Limited

ë Honorary Chairman

The Rice Exporters Association

The Thai Maize and Produce Trades Association

Mr. Thakonkiat ViravanPosition Independent Director

Education Master of Science, Boston University, USA



Number of Shares -


Experience Present ë Independent Director


ë Director


Ban Siam Holdings Company Limited




Exact Company Limited

Scenario Company Limited



24

Mr. Narong TaychachaiwongPosition Independent Director and Member of the Audit Committee

Education B.FA., Fine Art, University of Central Florida, USA.



Number of Shares -


Experience Present ë Independent Director and Member

of the Audit Committee


ë Chairman

Inter-Far East Engineering Public Company Limited

Mr. Surachet SuboonsonPosition Independent Director and Member of the Audit Committee

Education B.A., Accounting, Thammasat University



Number of Shares -


Experience Present ë Independent Director and Member



Mrs. Boonperm JiamtiranatPosition Independent Director and Chairman of the Audit Committee

Education B.A., Accounting, Chulalongkorn University



Number of Shares -


Experience Present ë Independent Director and Chairman



ë Member of Audit Committee

Surapon Foods Public Company Limited

ë Director

Noble Estate Company Limited



25

Miss Songsri PanichPosition Vice President: Project Operation Department

Education Master of Business Administration (Marketing),

Dominican University, USA

Number of Shares -


Experience Present ë Vice President: Project Operation Department


Mr. Sira UdolPosition Vice President: Project Operation Department

Education Master of Management SASIN Graduate Institute of

Business Administration of Chulalongkorn University

Number of Shares -




Idirexdotcom Company Limited

ë Vice President: Project Operation Department


Mr. Arat SawatatatPosition Vice President: Project Operation Department

Education Master of Science (Land Development),

Texas (A&M) University, USA

Number of Shares -



S&P Property Management Company Limited

ë Vice President: Project Operation Department




26

Mrs. Angkana IntravichienPosition Vice President: Accounting and Finance Department

Education Master of Business Administration, NIDA

Number of Shares -


Experience Present ë Vice President: Accounting and Finance Department


Mr. Manit NgamsantiwongsaPosition Vice President : After Sales Service Department

Education B.ENG., Sanitary Engineering and Civil Engineering,

Chulalongkorn University

Number of Shares -




ë Vice President: After Sales Service Department


* Remark All of the company's directors and executive officers do not hold the Company and its subsidiaries' debentures



27

Corporate Governance

We realize that good corporate governance

is the important factor in strengthening our

effective management system. It can be

taken as a reflection of our high standard

and transparency, which will lead to our

Company's sustainable growth. Therefore,

we decide to implement 15 principles of

good corporate governance regulated by the

Stock Exchange of Thailand as our business

guideline and core policy. They can be

summarized as follows:

1. The Corporate Governance Policy

Our corporate governance policy is settled

to cover our important value, which is the

fair treatment to both our shareholders and

stakeholders. Our board of directors and

management team are committed to their

duties according to the Company's

Objectives and Article of Association with

honesty, ethic, and the obedience to the

law. Our policy must be strictly followed to

prevent the abuse of the Company's internal

information for personal benefits. We

implement the appropriate internal

monitoring system. Our information system

is prepared to publicize the transparent,

complete and ready-to-be-checked

information.

2. The Right and Equality of the Shareholders

We realize the importance of the right and

equality of every shareholder. Our

shareholders have the right to receive

information, attend the meetings, vote,

appoint and discharge directors, express

their opinion, and raise any questions at the

meetings. At least 7 days prior to every

meeting, the shareholders will receive a

notice consisted of the meeting's agenda

and the board of directors' opinion on the

issue. We accommodate the meeting place

to fit most of our shareholder's convenience.

The Chairman of the Board attends every

shareholder's meeting. In the former

meeting, the Company assigned the

Chairman of the Audit Committee and the

Audit Committee to represent the

shareholders who cannot attend the

meeting.

3. The Right of the Stakeholders

We perceive the shared value between the

stakeholders and the Company. Therefore,

we promote the coherence and trust among

every party in order to sustain our

competitiveness and growth.

ë Customer : As our most important

supporters and stakeholders, we value our

customers and do our best to protect their

benefit. We develops not only the design,

the quality and the standard of our houses,

but also the after-sale project management

division to maintain a pleasant environment

and offer maintenance service to the

customer even after the ownership is

transferred. Moreover, we offer the

information about our house's designs and

materials, so that the customer can compare

our quality and standard with others.

Corporate Governance


28

ë Employees and Executives : As the most

important drives for the Company's success,

our employees and executives are offered

the appropriate and fair remunerations. The

Company also encourages training and

development to enhance competency for

present responsibility and line of works.

Moreover, the employees are able to

participate with the executive officers to

establish goals of the Company.

ë Competitors : We promote the free-trade

policy and fair competition under the legal

regulation and business ethic.

ë Partners : We transparently and fairly

select our contractors (partners), and follow

every contract strictly. Generally, the

contract already includes the labor and the

material cost. However, in case of material

shortage, we offer our hand in negotiating

for a better solution in order to support our

contractors on material cost.

ë Debtors : Although we have a strong

financial status and liquidity, we never forget

the importance of the financial support from

our investors and financial institutions.

Therefore, we promise to maintain our

creditability as best as we have done so far.

ë Government and Relevant Sectors : The

Company respects and follows the relevant

laws and regulations strictly in order to

advantage our customer, environment,

community and society.

ë Community and Society : As a Thai Company,

we realize that our business will never be

conducted successfully if it distresses our

community and society. Therefore, we

develop our after-sale project management

division to maintain a pleasant environment

and offer maintenance service to the customer

even after the proprietorship is transferred.

4. The Shareholders' meeting

A quorum will be constituted if at least 6

directors, who two of them are independent

directors, attend the meeting. The Chairman

attends every meeting to answer the

shareholders' inquiries. The agendas and

issues in every meeting are recorded in

detail and can be inspected.

5. Leadership and Vision

All of the Company's directors are well

aware of their duties and responsibilities

driven by the expectation and trust of the

shareholders. Therefore, every director

performs his duties cautiously, faithfully and

ethically to pursue the shareholders' best

benefit the Company

6. The Conflict of Interests

To prevent and avoid the conflict of

interests, the Company prohibits the

directors and executives, including their

spouses and dependents, from abusing the

unpublicized internal information for their

personal benefits. Moreover, the directors

and executives have duty to submit the

report regarding any change on their

security holding. In addition, the Company

sets the very strict policy regarding the

approval of transactions between the related

parties.

7. The Business Ethic

The Company conducts its business

ethically. We clearly determine a "Code of

Conduct" in written document, including the

right of the stakeholders, the duties to the

stakeholders, the monitoring of the

Company's assets and the utilization of the

Company's information, to be a guideline

and direction for the board of directors,

executives, and employees. The Company

will set up a training course on the issue

and monitor the result of the code

continuously.

8. The Check-and-balance Power among Non-Executive Directors

The structure of the board of directors,

which 55% comprises of independent

directors, who have reputation, high

business expertise and not been controlled

by the Management, creates a sufficient

monitoring and a balance of power in the

board. It can be ensured the independent

and transparent management under the

board.


29

Corporate Governance (Continued)

9. The Acquisition and Separation of Position

At present, though the Chairman and

Managing Director are the same person, the

structure of the Board of directors, which

55% comprises of independent directors,

still balances the management for

monitoring and auditing.

10. The Remunerations for the Board and Executives

The remunerations for the board are clearly

and transparently set and approved by the

shareholders' meeting. For the executives,

their remunerations depend on the

Company's operating results and their

individual performances in comparing to the

equivalent industry. The objective is to

motivate and create a competitive strength.

11. The Board of Directors' Meeting

At least 7 days prior to every meeting, the

directors will receive a notice consisted of

the meeting's agenda and relevant

information. The minutes are well recorded

in detail and retained for the Board of

directors and related person to be later

inspected.

12. The Subcommittee

The Board of directors set up the Audit

Committee to support in corporate governance

for the accuracy and transparency in the

Company's financial statements and the

sufficiency of information disclosure. Their

duties, responsibilities and authorities are

set according to the SET's rules and

regulations. The Chairman of the Audit

Committee discloses their corporate

governance report in the Company's annual

report and annual information.

13. The Internal Control and Audit

The Company has set up an internal audit

line to monitor and assess the internal

control system in operation and financial

transaction. The internal audit line reports

directly to managing director and the Audit

Committee.

14. The Directors' Report

The Board of directors are responsible for

the accuracy, the completeness and the

sufficiency of the information disclosure in

the financial statements and annual

information according to the general-accepted

standard and the related regulations.

Moreover, they have the duties to implement

and enforce an efficient internal control

system and monitor all functions to follow

the said system.

15. The Investor Relation

The Company considers the importance of

the correct, transparent, up-to-date and

accessible information disclosure. We

publicize our essential information through

every SET's channel and through our own

web site at www.noblehome.com. Moreover,

the Company set up the analyst meeting

regularly to open a forum where our

management attend to answer the inquiries

from the investors, analysts, and interested

parties. In addition, the Company has a

roadshow program in order to update the

Company's information and progress to the

foreign investors. Any further information,

please contact Ms.Vasana Thieansirisak at

02-251-9955 #1400-1401 and the e-mail

address [email protected], or visit us

at www.noblehome.com.


30


Monitoring the Utilization of Internal Information

The Company strictly set the policy to avoid

the abuse of the Company's internal

information. The Company also prohibits

directors and executives including their

spouses and dependents from abusing the

unpublicized internal information for their

personal benefits, particularly during the

period of one month prior to publicizing the

Company's financial statement, lest it may

affect the securities' trading prices. The

board and executives have the duty to

submit the report on any changed regarding

their securities holding to the Company, SET

and SEC. The Company also informed its

executives of their duties and obligations in

preparing such report and disclosure of

securities holding, including the stipulations

on penalties in Article 275 of the Securities

and Exchange Act B.E.2535 (A.D.1992).

Moreover, the executives will be punished if

they use the internal information for their

personal benefits.

Internal Control

The Board of Directors assigned the Audit

Committee to take care, monitor and review

the properness and effectiveness of internal

control system to ensure that the Company's

internal control is appropriate and adequate

to protect the Company and its subsidiaries'

properties for the benefit of the shareholders.

The Company has internal audit team to

monitor and assess the internal control

adequacy for every operating unit. In

addition, the Company also regularly has the

internal and external risk assessment, which

might impact on its operation.

To evaluate the Company's internal control

system, the scope included 3 main areas

which were construction, sale, and transfer

of ownership. The assessment was to

evaluate the properness, adequacy and

effectiveness. Moreover, the assessment also

covered the adequacy and appropriateness

of policies, rules and regulations, work

processes, job allocation, empowerment and

approval authority, and the punctuality and

accuracy in reports preparation for

management.

The Board of Directors Meeting No. 2/2006

on February 28, 2006, which consisted of

the Board of directors and all member of the

Audit Committee reviewed and evaluated

the sufficiency of the internal control system

for the year 2005 including organization and

environment, risk management, controlling

the executives' performance, information and

communication and monitoring system From

the reviews, the Audit Committee and the

Board did not find any material items that

may potentially have adverse effects or

insufficiency of the Company's internal

control.


31


The audit committee of Noble Development

Public Company comprises of 3 independent

directors. The chairman of the audit committee

is Mrs. Boonperm Jiamtiranat and two

members of the committee are Mr. Narong

Taychachaiwong and Mr. Surachet Suboonson.

In 2005, the Audit Committee held 5 meetings

to review and regulate the operations in

accordance with assigned scope of duties

and responsibilities and report to the Board of

Directors. The Committee also had the

meetings with the internal audit team and the

Company's external auditor.

The Committee discussed with the external

auditor, PricewaterhouseCoopers ABAS Ltd.,

in order to acknowledge the matters and

exchange opinions to evaluate the quality

and accuracy of the quarterly and annual

Financial Statements prepared by the

Management. In addition, the meetings

assessed the adequacy of the information

disclosure, particularly in related and

connected transactions, and evaluated the

efficiency and appropriateness of the

Company's internal control system. The

Committee also had the meetings with the

internal audit team to acknowledge the result

of the company's internal control audit and

evaluation, as well as the suggestion to

improve the efficiency, adequacy and

appropriateness of the company's internal

control system.

By complying with the scope of duties and

responsibilities and discussing with the

auditor and the Management, the Audit

Committee did not find any material items

that were not recorded or disclosed in the

Company's Financial Statements that may

potentially have adverse effects on the

Company's financial status and performance.

In addition, the Committee did not find any

situation regarding the internal control

system that showed material weak points

that may potentially affect the accuracy and

reliability of the Company's Financial

Statements.

(Mrs. Boonperm Jiamtiranat)

Chairman of the Audit Committee

February 28, 2006

The Audit Committee's Report


32

Charts of Operating Performance and Revenue Structure

Total Assets and Shareholders' Equity

0

1,000

2,000

3,000

4,000

5,000

6,000

Total Assets

Shareholders' Equity

Net D/E Ratio

D/E Ratio

2005 2004

Debt and Net Debt to Equity Ratio

Total Revenues and Net Profit

2005 2004

2005 20040.0

0.2

0.4

0.6

0.8

1.0

1.2

0

500

1,000

1,500

2,000

2,500

3,000

Net Profit

Total Revenues

2,889

5,363

2,526

5,287

0.86

0.69

1.09

0.86

2,528

456

1,817

335

Charts of Operating Performance


33

Unit : Million Baht

2005 2004

Revenue from Property Development Business 2,458 1,770

Revenue from Department Store Business 48 -

Others Income 22 47

Total 2,528 1,817

Charts of Revenue Structure


2005 Revenues Structure 2004 Revenues Structure

1.9% Revenue from Department Store Business

0.9% Others Income

97.2% Revenue from Property Development Businesså

2.6% Others Income

97.4% Revenue from Property Development Business

34

Operating Results

In 2005, the Company recorded the net

profit of THB 456.43 million, an increase of

36.4 % from THB 334.61 million recorded in

2004. Total revenue in 2005 was THB

2,528.04 million, increased from THB 710.65

million in 2004 due to the following reasons.

ë The success from sales of the Company's

projects, especially condominium projects. In

2005, the revenue from property development

business was 38.9 % higher than 2004, with

a gross profit margin of 39.5 %.

ë In April 2005, "Playground", the first

shopping centre project of the Company

located in the prime area of Thonglor, was

launched. Revenue from retail business, rental

and services were THB 48.02 million, with the

gross profit margin of 46.4 %.

ë The selling and administrative expenses in

2005 was THB 418.09 million, 16.7 % of

sales. It decreased from 24.0 % of sales in

2004 because of decreasing in marketing

expenses from 7.9 % in 2004 to 2.0 % in

2005.

ë In 2005, the Company has net profit

margin before tax of 22.7 %, higher than

18.2 % in 2004.

Financial Status

ë Total assets of the Company and its

subsidiaries as at December 31, 2005 were

recorded at THB 5,363.29 million, a 1.44 %

increase from THB 5,287.02 million in 2004.

Unbilled completed works increased by THB

469 million because the Company

accelerated condominium construction to

make them ready for sale and transfer in

2005. At the end of 2005, two of the

condominium projects were completed,

Noble Ora Condominium and Noble 09

Project. The construction of Noble Lite

project is expected to be completed and be

ready to transfer to customers in the second

quarter of 2006.

ë Total liabilities of the Company and its

subsidiaries were recorded at THB 2,474.42

million, decreasing by THB 287.03 million

from THB 2,761.45 million in 2004. At the

end of 2005, the Company's net debt to

equity ratio was 0.69, while its debt to

equity ratio was 0.86, a decrease from 0.86

and 1.09 time in 2004 respectively.

ë The Company and its subsidiaries'

shareholder's equity in 2005 was recorded

at THB 2,888.87 million, a 14.4% increase

from THB 2,525.57 million recorded in 2004.

The return on equity was 15.80%. The book

value per share increased from THB 5.53 in

2004 to THB 6.33.

In 2005, the Company's operating results

was excellent because of revenue from

property development business that

increased by 39%. With the Company's

financial strength and success of projects, in

2006 we plan to launch at least new projects

of single detached house and condominium,

totaling of more than THB 3.6 Billion. In

order to continue a long-term expansion, the

Company also planned to acquire THB 1,000

billion of assets in 2006. The Company will

build quality projects for unique lifestyles

under the prudent and efficient policy to

manage project and capital.

Analysis of Financial Status and

Operating Results


35

Audit Fee

In 2005, the Company and its subsidiaries paid the audit fee totaling THB 1,995,000 and out of

pocket expenses totaling THB 38,366 to the Company's external auditor, PricewaterhouseCoopers ABAS

Ltd.

Non-Audit Fee

In 2005, the Company and its subsidiaries have a commitment to pay for the uncompleted

services, which are legal and tax matters service fee, to PricewaterhouseCoopers ABAS Ltd.,

totaling THB 30,000


Remunerations for External Auditor

36

Company Factsheet



Head Office 19th Fl., Tonson Tower, 900 Ploenchit Road, Lumpini, Pathumwan,

Bangkok 10330

Home Page www.noblehome.com

Main Business Property Development

Registered Number 0107538000312

Registered Capital 474,782,565 Shares at Baht 5 par value totaling Baht 2,373,912,825

Paid Up Capital THB 2,282,355,875

Ordinary share Registrar Thailand Securities Depository Company Limited

4th, 6

th- 7

th Fl., The Stock Exchange of Thailand Building

62 Rachadapisek Road, Klongteoy, Bangkok 10110

Tel. 0-2229-2800

Debenture Registrar The Debentures of Noble Development Public Company Limited

No.1/2546 DUE B.E. 2549

TMB BANK PUBLIC COMPANY LIMITED

393 Silom Road, Bangrak, Bangkok 10500

Tel. 0-2230-6295

Auditor Mr. Boonmee Ngotngamwong

Certified Public Accountant Registration No. 3673

Mr. Kajornkiet Aroonpirodkul


Mr. Prasit Yuengsrikul


PricewaterhouseCoopers ABAS Limited.

15th Fl., Bangkok City Tower

179/74 - 80 South Sathorn Road, Bangkok 10120

Tel. 0-2286-9999, 0-2344-1000

Legal Advisor Mr. Pathiparn Tatikhun LL.B.

Lawyer's License No. 266/2540

95/174 Panason Garden Home Moo2, Minburi, Bangkok 10510

Tel. 0-2543-6870

External Legal Advisor White & Case (Thailand) Limited.

22nd

Fl., Mercury Tower, 540 Ploenchit Road, Lumpini, Pathumwan,

Bangkok 10330

Tel. 0-2264-8000

37

Address and Telephone Number of Head Office and Projects

ë Head Office: Noble Development Public Company Limited

19th Fl., Tonson Tower, 900 Ploenchit Road, Lumpini, Pathumwan, Bangkok

Tel. 0-2251-9955

ë Noble Wana Pinklao

9/121 Moo 5, Pinklao-Nakornchaisi Road km. 15, Salathammasop, Thaveewattana, Bangkok

Tel. 0-2888-6611, 0-2251-9955

ë Noble Anawana Pinklao

28 Moo 8, Pinklao-Nakornchaisi Road km. 15, Salathammasop, Thaveewattana, Bangkok

Tel. 0-2888-6611, 0-2251-9955

ë Noble Wana Watcharapol

179 Moo 3, Soi Ruammitrpattana, Watcharapol Road, Tarang, Bangkhen, Bangkok

Tel. 0-2949-8530-1, 0-2251-9955

ë Noble Geo Watcharapol

222 Soi Watcharapol (Ruammitrpattana), Ramindra Road, Tarang, Bangkhen, Bangkok

Tel. 0-2998-4255, 0-2251-9955

ë Noble Geo Rama 5

58 Moo 6, Nakorn-in-Karnjanapisek Road, Bangkoonkong, Bangkruai, Nontaburi

Tel. 0-2985-0683, 0-2985-0686-8, 0-2251-9955

ë Noble Tara Ngamwongwan and Noble Tara Ngamwongwan

66/1 Moo 8,Rattanatibeth Road, Bangkrasor, Muang, Nontaburi

Tel. 0-2965-5800, 0-2251-9955

ë Noble Tara Pattanakarn

2046 Pattanakarn Road, Suanluang, Suanluang, Bangkok

Tel. 0-2720-4000, 0-2251-9955

ë Noble Ora Thonglor

822 Soi Sukhumvit 55 (Thonglor), Sukhumvit Road, Klongton Nue, Wattana, Bangkok

Tel. 0-2714-7844, 0-2251-9955

ë Noble Zero Nine

9 Soi Ruamrudee, Wireless Road, Lumpini, Pathumwan, Bangkok

Tel. 0-2251-9955

ë Noble Lite

46 Soi Aree 1, Paholyothin Road, Samsen-nai, Phayathai, Bangkok

Tel. 0-2278-0011, 0-2251-9955

ë Noble Ambience Ruamrudee

81 Soi Ruamrudee, Wireless Road, Lumpini, Pathumwan, Bangkok

Tel. 0-2255-7999

ë Noble Ambience Sarasin

237 Rajdumri Road, Lumpini, Pathumwan, Bangkok

Tel. 0-2255-7999

ë Noble Sukhumvit 36

19th Fl., Tonson Tower, 900 Ploenchit Road, Lumpini, Pathumwan, Bangkok

Tel. 0-2251-9955

ë Playground Store

818 Soi Sukhumvit 55 (Thonglor), Sukhumvit Road, Klongton Nue, Wattana, Bangkok

Tel. 0-2714-7888, 0-2714-9616-9, 0-2251-9955


38


To the Shareholders of Noble Development Public Company Limited

I have audited the accompanying consolidated

and company balance sheets as at 31

December 2005 and 2004, and the related

consolidated and company statements of

income, changes in shareholders' equity and

cash flows for the years then ended of Noble

Development Public Company Limited and its

subsidiaries, and of Noble Development Public

Company Limited, respectively. The Company's

management is responsible for the correctness

and completeness of information in these

financial statements. My responsibility is to

express an opinion on these financial

statements based on my audits.

I conducted my audits in accordance with

generally accepted auditing standards. Those

standards require that I plan and perform the

audit to obtain reasonable assurance about

whether the financial statements are free of

material misstatement. An audit includes

examining, on a test basis, evidence supporting

the amounts and disclosures in the financial

statements. An audit also includes assessing

the accounting principles used and significant

estimates made by management, as well as

evaluating the overall financial statement

presentation. I believe that my audits provide a

reasonable basis for my opinion.

In my opinion, the consolidated and company

financial statements referred to above present

fairly, in all material respects, the consolidated

and company financial position as at 31

December 2005 and 2004, and the

consolidated and company results of

operations and cash flows for the years then

ended of Noble Development Public Company

Limited and its subsidiaries, and of Noble

Development Public Company Limited,

respectively, in accordance with generally

accepted accounting principles.

Without qualifying my opinion, I draw your

attention to Note 18 to the consolidated and

company financial statements which explains

the Company's plan to remove the balance of

share discount outstanding as at 31 December

2005 amounting to Baht 844 million in full to

comply with the Circular Letter of the Office of

the Securities and Exchange Commission

relating to the removal of share discount.

BOONMEE NGOTNGAMWONG

Certified Public Accountant

(Thailand) No. 3673

PricewaterhouseCoopers ABAS Limited

Bangkok

28 February 2006

AUDITOR'S REPORT

39


Consolidated Company

2005 2004 2005 2004

Notes Baht Baht Baht Baht

Assets

Current Assets

Cash and cash equivalents 3 470,859,539 578,220,428 436,366,352 560,023,999

Short-term investments 4 23,836,603 53,153,634 12,836,916 53,153,634

Trade accounts receivable - retail business 1,140,296 - - -

Trade accounts receivable - real estate

development business 5 808,503 1,642,763 808,503 1,642,763

Unbilled completed work 5 622,299,151 153,075,741 622,299,151 153,075,741

Short-term loans to and amounts due from

subsidiaries, net 10 - - 568,017,308 420,651,719

Inventories, net 7 195,899,620 56,491,917 173,209,685 56,491,917

Real estate development cost 8 3,425,488,295 3,843,630,351 2,276,832,218 2,767,275,658

Other current assets 9 213,932,044 293,586,398 226,193,553 298,513,582

Total Current Assets 4,954,264,051 4,979,801,232 4,316,563,686 4,310,829,013

Non-Current Assets

Long-term trade accounts receivable, net

5 680,000 680,000 680,000 680,000

Long-term loans to and amounts due from

other company 6 93,374,203 86,055,029 93,374,203 86,055,029

Investments - equity method 10 - - 392,066,811 394,002,134

Land held for future development, net 11 - 57,195,808 - 57,195,808

Property and equipment, net 12 276,320,943 46,333,088 228,613,623 39,299,895

Deferred tax assets, net 17 19,346,233 73,197,033 19,346,233 73,197,033

Other assets 13 19,304,070 43,754,684 16,385,470 43,061,663

Total Non-Current Assets 409,025,449 307,215,642 750,466,340 693,491,562

Total Assets 5,363,289,500 5,287,016,874 5,067,030,026 5,004,320,575


Balance Sheets

As at 31 December 2005 and 2004

The notes to the consolidated and company financial statements on pages 46-74 form an intergral part of the financial

statements.

40



2005 2004 2005 2004


Liabilities and

Shareholder's Equity

Current Liabilities

Short-term loans from financial institutions 15 367,498,381 633,701,452 367,498,381 633,701,452

Accounts payable - construction

ë related company 25 - - 185,991 185,991

ë others 88,729,889 245,454,761 76,998,486 226,804,598

Trade accounts payable

ë related company 25 - - 422,559

ë others 14,543,142 - -

Billing in excess of work in progress - 1,668,493 - 1,668,493

Amount due to and loans

from subsidiary 25 - - 109,219,052 121,325,511

Current portion of long-term borrowings 15 1,000,000,000 - 1,000,000,000

Deposits and advances received

from customers 69,013,150 70,275,029 68,813,150 70,143,799

Retention payable 80,463,404 96,633,127 75,405,814 92,657,163

Other current liabilities 14 130,519,329 117,800,164 106,851,028 92,600,287

Total Current Liabilities 1,750,767,295 1,165,533,026 1,805,394,461 1,239,087,294

Non-Current Liabilities

Long-term borrowings 15 653,149,000 1,557,600,000 283,149,000 1,187,600,000

Liabilities arisen from

investments in subsidiaries 10 - - 15,350,546 13,928,098

Deferred tax liability 17 68,041,369 38,268,935 68,041,369 38,268,935

Other liabilities 2,464,800 46,550 - 46,550

Total Non-Current Liabilities 723,655,169 1,595,915,485 366,540,915 1,239,843,583

Total Liabilities 2,474,422,464 2,761,448,511 2,171,935,376 2,478,930,877

Shareholder's Equity

Share capital

Registered share capital 18 2,373,912,825 2,373,912,825 2,373,912,825 2,373,912,825

Issued and paid-up share capital 18 2,282,355,875 2,282,355,875 2,282,355,875 2,282,355,875

Share premium 18 - 781,292,711 - 781,292,711

Share discount 18 (843,768,010) (1,625,060,721) (843,768,010) (1,625,060,721)

Retained earnings

Appropriated

Legal reserve 19 90,170,667 67,348,943 90,170,667 67,348,943

Unappropriated 1,366,336,118 1,019,452,890 1,366,336,118 1,019,452,890

Total Parent's Shareholder's Equity 2,895,094,650 2,525,389,698 2,895,094,650 2,525,389,698

Minority interest 16 (6,227,614) 178,665 - -

Total Shareholder's Equity 2,888,867,036 2,525,568,363 2,895,094,650 2,525,389,698

Total Liabilities and Shareholders' Equity 5,363,289,500 5,287,016,874 5,067,030,026 5,004,320,575

-

-

-


statements.


Balance sheets (Continued)

As at 31 December 2005 and 2004

41



2005 2004 2005 2004


Revenues

Revenues from sales - real estate

development business 2,457,774,836 1,719,367,202 2,313,526,836 1,719,367,202

Revenues from construction services 105,897 50,854,637 44,028 47,845,173

Revenues from sales - retail business 35,848,370 - - -

Revenues from rental and services 12,168,130 - 22,606,533 -

Gain on foreign currency exchange 20, 22 - 26,989,664 - 26,989,664

Interest income 15,945,172 12,757,055 49,771,187 45,390,916

Share of profits in investments

ë equity method 10 - - 14,913,310 -

Other income 6,199,975 7,426,782 4,977,056 7,359,280

Total Revenues 2,528,042,380 1,817,395,340 2,405,838,950 1,846,952,235

Expenses

Cost of sales - real estate development

business 1,486,159,629 1,026,460,330 1,388,343,996 1,026,460,330

Cost of construction services - 38,809,173 - 36,772,165

Cost of sales - retail business 17,857,755 - - -

Cost of rental and services 7,860,549 - 8,084,368 -

Selling and administrative expenses 417,185,100 423,747,276 330,749,722 412,842,435

Director's remuneration 905,000 825,000 905,000 825,000

Share of losses of investments

ë equity method 10 - - 55,941,675 13,249,269

Total Expenses 1,929,968,033 1,489,841,779 1,784,024,761 1,490,149,199

Profit before interest expenses and

income tax 22 598,074,347 327,553,561 621,814,189 356,803,036

Interest expenses (38,491,963) (5,158,558) (52,825,526) (33,836,698)

Profit before income tax 559,582,384 322,395,003 568,988,663 322,966,338

Income tax 21 (112,554,188) 11,641,721 (112,554,188) 11,641,721

Profit before minority interest 447,028,196 334,036,724 456,434,475 334,608,059

Net loss of subsidiary attributable to minority

interest 16 9,406,279 571,335 - -

Net profit for the year 456,434,475 334,608,059 456,434,475 334,608,059

Basic earnings per share 23

Net profit for the year 1.00 0.73 1.00 0.73


statements.


Statements of Income

For the year ended 31 December 2005 and 2004

42

Consolidated (Baht)

Issued and Retained earnings

paid-up Share Share Appropriated- Minority

share capital premium discount legal reserve interest

(Note 18) (Note 18) (Note 18) (Note 19) Unappropriated (Note 16) Total

Opening balance 2005 2,282,355,875 781,292,711 (1,625,060,721) 67,348,943 1,019,452,890 178,665 2,525,568,363

Transfer of share premium to offset

against share discount (Note 18) - (781,292,711) 781,292,711 - - - -

Net profit for the year - - - - 456,434,475 - 456,434,475

Dividend paid (Note 18) - - - - (86,729,523) - (86,729,523)

Legal reserve - - - 22,821,724 (22,821,724) - -

Increase during the year - - - - - (6,406,279) (6,406,279)

Closing balance - 31 December 2005 2,282,355,875 - (843,768,010) 90,170,667 1,366,336,118 (6,227,614) 2,888,867,036

Opening balance 2004 2,282,355,875 781,292,711 (1,625,060,721) 50,618,540 893,293,128 - 2,382,499,533

Net profit for the year - - - - 334,608,059 - 334,608,059

Dividend paid (Note 18) - - - - (191,717,894) - (191,717,894)

Legal reserve - - - 16,730,403 (16,730,403) - -

Increase during the year - - - - - 178,665 178,665

Closing balance - 31 December 2004 2,282,355,875 781,292,711 (1,625,060,721) 67,348,943 1,019,452,890 178,665 2,525,568,363


The notes to the consolidated and company financial statements on pages 46-74 form an intergral part of the financial statements.


Statements of changes in shareholders' equity


43

Company (Baht)

Issued and Retained earnings

paid-up Share Share Appropriated-

share capital premium discount legal reserve

(Note 18) (Note 18) (Note 18) (Note 19) Unappropriated Total

Opening balance 2005 2,282,355,875 781,292,711 (1,625,060,721) 67,348,943 1,019,452,890 2,525,389,698

Transfer of share premium to offset

against share discount (Note 18) - (781,292,711) 781,292,711 - - -

Net profit for the year - - - - 456,434,475 456,434,475

Dividend paid (Note 18) - - - - (86,729,523) (86,729,523)

Legal reserve - - - 22,821,724 (22,821,724) -

Closing balance - 31 December 2005 2,282,355,875 - (843,768,010) 90,170,667 1,366,336,118 2,895,094,650

Opening balance 2004 2,282,355,875 781,292,711 (1,625,060,721) 50,618,540 893,293,128 2,382,499,533

Net profit for the year - - - - 334,608,059 334,608,059

Dividend paid (Note 18) - - - - (191,717,894) (191,717,894)

Legal reserve - - - 16,730,403 (16,730,403) -

Closing balance - 31 December 2004 2,282,355,875 781,292,711 (1,625,060,721) 67,348,943 1,019,452,890 2,525,389,698


The notes to the consolidated and company financial statements on pages 46-74 form an intergral part of the financial statements.


Statements of changes in shareholders' equity (Continued)


44



2005 2004 2005 2004


Cash flows receipts from (used in)

operating activities 20 408,813,658 (812,468,077) 489,006,806 (579,596,713)

Cash flows from investing activities

Decrease in guaranteed deposits

at banks 29,317,031 24,246,548 40,316,718 24,246,548

Short-term loans to subsidiaries - - (218,651,687) (202,906,000)

Long-term loans to other company 6 (1,500,000) (8,300,000) (1,500,000) (8,300,000)

Purchases of property and equipment 12 (53,457,984) (14,099,333) (3,965,577) (6,955,062)

Payment for land deposit 9 - (140,000,000) - (140,000,000)

Payment for land (236,150,000) - (236,150,000) -

Proceeds from repayments of

short-term loans to subsidiaries - - 80,419,687 621,200,000

Proceeds from repayments

of loans to other company 6 - 9,500,000 - 9,500,000

Cash invested in investments

in subsidiaries 10 - - - (404,250,000)

Increase in share subscription

receivable 9 - - - (17,000,000)

Proceed from minority interest for capital 16 3,000,000 750,000 - -

increase

Proceeds from disposals of property and

equipment - 3,800 - 3,800

Net cash used in investing activities (258,790,953) (127,898,985) (339,530,859) (124,460,714)

Cash flows from financing activities

(Repayments) proceeds from short-term

loans from financial institutions, net (266,203,071) 11,286,445 (266,203,071) 11,286,445

Proceeds from long-term borrowings 15 470,400,000 557,600,000 470,400,000 187,600,000

Proceeds from short-term loans from

subsidiary - - - 117,720,000

Repayments of long-term borrowings 15 (374,851,000) - (374,851,000) -

Repayments of short-term loans from

subsidiary - - (15,750,000) -

Dividend payment 18 (86,729,523) (191,717,894) (86,729,523) (191,717,894)

Net cash (used in) receipts from financing

activities (257,383,594) 377,168,551 (273,133,594) 124,888,551

Net decrease in cash and cash equivalents (107,360,889) (563,198,511) (123,657,647) (579,168,876)

Cash and cash equivalents - beginning

balance 578,220,428 1,141,418,939 560,023,999 1,139,192,875

Cash and cash equivalents - ending

balance 470,859,539 578,220,428 436,366,352 560,023,999

Non-cash transactions

Operating activities

Transferred projects which 90% of projects

have been sold from real estate

development cost to inventories 56,952,342 23,112,817 56,952,342 23,112,817

Transfer from real estate development

cost to property and equipment (Note 12) 200,243,408 - 200,243,408 -

Transfer from land held for future

development to inventories (Note 11) 57,195,808 - 57,195,808 -


statements.


Statements of Cash Flows


45


1 General information


("the Company") is a public limited company

incorporated and resident in Thailand. The

address of its registered office is as follows:

900 Tonson Tower, 19th floor, Ploenchit Road,

Lumpini, Pathumwan, Bangkok.

The Company is listed on the Stock Exchange

of Thailand. For reporting purposes, the

Company and its subsidiaries are referred to

as the "Group".

The principal business operations of the

Company and its subsidiaries ("the Group") are

development of real estate for sale, providing

construction services, retail business, rental

and services and construction consulting in

Thailand.

The Group employed 291 employees as at 31

December 2005 (2004 : 228 employees).

These consolidated and company financial

statements have been approved by the

Company's Board of Directors on 28 February

2006.

2 Accounting policies

The principal accounting policies adopted in

the preparation of these consolidated and

company financial statements are set out

below:

2.1 Basis of preparation

The consolidated and company financial

statements have been prepared in accordance

with Thai generally accepted accounting

principles under the Accounting Act B.E. 2543,

being those Thai Accounting Standards issued

under the Accounting Profession Act B.E.

2547, and the financial reporting requirements

of the Securities and Exchange Commission

under the Securities and Exchange Act B.E.

2535.

As a result of the Federation of Accounting

Profession approval of three new accounting

standards on 12 May 2005, the Company has

adopted TAS 52, "Events After Balance Sheet

Date", TAS 53, "Provisions, Contingent

Liabilities, and Contingent Assets", and TAS

54, "Discontinuing Operations", since the

second quarter of 2005.

The consolidated and company financial

statements have been prepared under the

historical cost convention except for impairment

as disclosed in the accounting policies below.

An English version of the consolidated and

company financial statements have been

prepared from the statutory financial statements

that are in the Thai language. In the event of a

conflict or a difference in interpretation between

the two languages, the Thai language statutory

financial statements shall prevail.

2.2 Use of estimates

The preparation of consolidated and company

financial statements in conformity with Thai

generally accepted accounting principles

requires management to make estimates and

assumptions that affect the reported amounts

of assets and liabilities, the disclosure of

contingent assets and liabilities at the date of

the financial statements and the amounts of

revenues and expenses in the reported period.

Although these estimates are based on

management's best knowledge of current

events and actions, actual results may differ

from those estimates.

Noble Development Public

Company Limited

Notes to the consolidated and

company financial statements

For the years ended 31 December 2005 and 2004

46


2.3 Consolidation

a) Subsidiaries

Subsidiary undertakings, which are those

companies in which the Group has power to

exercise control over the financial and

operating policies generally accompanying a

shareholding of more than one half of the

voting rights, have been consolidated.

Subsidiaries are consolidated from the date

in which effective control is transferred to

the Group and are no longer consolidated

from the date that control ceases.

All intercompany transactions, balances and

unrealised surpluses and deficits on

transactions between group companies have

been eliminated. Where necessary,

accounting policies for subsidiaries have

been changed to ensure consistency with

the policies adopted by the Group. Separate

disclosure is made for minority interests in

the consolidated balance sheet and

consolidated statement of income, except

where the minority interests reach zero.

Investments in subsidiary undertakings are

accounted for in the company financial

statements by using the equity method of

accounting.

A list of the Group's principal subsidiaries is

set out in Note 10.

b) Associates

Investments in associated undertakings are

accounted for by the equity method of

accounting. These are undertakings over

which the Group has significant influence,

but which it does not control, generally

accompanying a shareholding of between

20% and 50% of the voting rights.

Unrealised gains and losses on transactions

between the Group and its associated

undertakings are eliminated to the extent of

the Group's interests in the associated

undertakings. Equity accounting is

discontinued when the carrying amount of

the investment in an associated undertaking

reaches zero, unless the Group has incurred

obligations or guaranteed obligations in

respect of the associated undertaking.

A list of the Group's associates is set out in

Note 10.

2.4 Cash and cash equivalents

Cash and cash equivalents are carried in the

balance sheets at cost. For the purpose of

the statements of cash flows, cash and cash

equivalents comprise cash on hand, deposits

held at call at banks and fixed deposits and

deposits at financial institutions with original

maturity of three months or less and without

restriction.

2.5 Short-term investments

Short-term investments include fixed deposits

at banks which are pledged with the banks as

guarantees.

2.6 Trade accounts receivable

Trade accounts receivable are carried at

original invoice amount less an estimate made

for doubtful receivables. An estimate is made

for doubtful receivables based on a review of

all outstanding amounts at the year end. Bad

debts are written off during the year in which

they are identified.

Concentrations of credit risk with respect to

trade accounts receivable are limited due to

the Group's large number of customers in a

variety of businesses. Due to these factors,

management believes that no additional credit

risk beyond the amounts provided for collection

losses is inherent in the Group's trade accounts

receivable.

2.7 Inventories

The Group's inventories comprise condominium

units, land and single detached houses for

sale, construction supplies for sale including

retail products. Inventories are stated at the

lower of cost or net realisable value. Costs of

construction supplies are determined by the

first-in, first-out method. Costs of land,

condominium units for sales, single detached

houses for sale are determined by the specific

method. Retail products are determined by

the weighted average method. The cost of

inventory comprises purchase and construction

costs and other direct costs. Net realisable

value is the estimate of the selling price in the

ordinary course of business less selling

expenses. Allowance is made, where necessary,

for obsolete inventories.

47

2 Accounting policies (Continued)


2.8 Real estate development cost

Real estate development cost is stated at cost

less provision for loss on projects. Costs

include cost of land, cost of land development,

costs of constructions of real estate projects

and infrastructure and related borrowing costs.

The Company recognises real estate

development cost as cost of sale on the

percentage of completion method.

2.9 Construction contracts

The profit on a construction contract is

recognised as soon as it can be estimated

reliably. The Group uses the percentage of

completion method to determine the

appropriate amount to recognise in a given

period; the stage of completion is measured

by reference to work progress reported by

external construction managements. Losses

are recognised as soon as the losses are

foreseen. The full amount of the anticipated

loss, including any loss related to future

work on the contract, is recognised in the

period in which the loss is identified.

2.10 Investments

Investments in non-marketable equity securities

which are classified as general investments

are carried at cost. A test for impairment is

carried out when there is a factor indicating

that such investment might be impaired. If

the carrying value of the investment is higher

than its recoverable amount, an impairment

loss is charged to the statement of income.

On disposal of an investment, the difference

between the net disposal proceed and the

carrying amount is charged or credited to

the statement of income.

2.11 Land held for future development

Land held for future development comprises

land, which is held by the Company for

generating future benefits, and is treated as

a non-current asset. The land is stated at

cost less an allowance for impairment in

value. Cost includes cost of land and other

related interest incurred during the period of

development. Capitalisation of interests will

be suspended during extended periods in

which active development is interrupted or

when the development is completed.

2.12 Property and equipment

Property and equipment comprise of land of

clubhouses, clubhouses, building, building

improvements and office equipment.

Clubhouses comprise clubhouse buildings,

swimming pools and sports clubs. Land is

stated at cost less an allowance for

impairment. Other property and equipment

are initially recorded at cost less an allowance

for impairment and accumulated depreciation.

Depreciation is calculated on the straight

line method to write off the cost of each

asset, except for land as it is deemed to

have an indefinite life, to their residual

values over their estimated useful lives as

follows:

Clubhouses 5 - 20 years

Building 20 years

Building improvements 10 years

Furniture and fixtures,

and office equipment 5 years

Vehicles 5 years

Where the carrying amount of an asset is

greater than its estimated recoverable

amount, it is written down immediately to its

recoverable amount.

Gains and losses on disposals of property

and equipment are determined by reference

to their carrying amounts and are taken into

account in determining operating profit.

Expenditure incurred for addition, renewal and

betterment, which results in a substantial

increase in an asset's current replacement

value, is capitalised. Repair and maintenance

costs are recognised as an expense when

incurred.

48



2.13 Capitalisation of borrowing costs

Borrowing costs to finance the construction

of property and equipment are capitalised

during the period of time that is required to

complete and prepare the property for its

intended use as part of cost of the asset.

The borrowing costs include interest on

short-term and long-term borrowings.

The capitalisation rate used to determine the

amount of borrowing costs to be capitalised

is a weighted average interest rate applicable

to the Group's outstanding borrowings during

the year. Where funds are borrowed

specifically for the acquisition, construction

or production of property and equipment, the

amount of borrowing costs eligible for

capitalisation on that asset is determined at

the actual borrowing costs incurred on that

borrowing during the period less any

investment income on the temporary

investments of those borrowings.

2.14 Deferred income taxes

Deferred income tax is provided, using the

liability method, for all temporary differences

arising between the tax base of assets and

liabilities and their carrying amounts in the

financial statements. Tax rates at the balance

sheet date are used in the determination of

deferred income tax.

Deferred tax assets are recognised to the

extent that it is probable that future taxable

profit will be available against which the

temporary differences can be utilised. Valuation

allowance is made, where necessary, to write

down the carrying amounts of the deferred tax

assets to their recoverable amounts.

2.15 Financial instruments

Financial assets carried on the balance sheets

include cash on hand and at financial

institutions, investments, loans, trade

accounts receivable and deferred tax assets.

Financial liabilities carried on the balance

sheets include trade accounts payable,

accrued expenses, borrowings and deferred

tax liability. The particular recognition methods

adopted are disclosed in the individual

accounting policy statements associated with

each item.

Cross currency and interest rate swap option

contracts protect the Company from

movements in foreign currency exchange and

interest rates. The option contracts are not

recognised in the financial statements.

2.16 Accounting for long-term leases

Where the Group is the lessee

Leases not transferring a significant portion of

the risks and rewards of ownership to the

lessee are classified as operating leases.

Payments made under operating leases are

charged to the statement of income on a

straight-line basis over the period of the

lease.

When an operating lease is terminated before

the lease period has expired, any payment

required to be made to the lessor by way of

penalty is recognised as an expense in the

period in which termination takes place.

Where the Group is the lessor

Assets leased out under operating leases are

included in property and equipment in the

balance sheet. They are depreciated over

their expected useful lives on a basis

consistent with other similar property and

equipment owned by the Group. Rental

income (net of any incentives given to

lessees) is recognised on a straight-line basis

over the lease term.

2.17 Related parties

Enterprises and individuals that directly, or

indirectly through one or more intermediaries,

control, or are controlled by, or are under

common control with the Company, including

holding companies and subsidiaries are

related parties of the Company. Associates

and individuals owning, directly or indirectly,

an interest in the voting power of the

Company that gives them significant influence

over the enterprise, key management

personnel, including directors and officers of

the Company and close members of the

family of these individuals and companies

associated with these individuals also

constitute related parties.

In considering each possible related party

relationship, attention is directed to the

substance of the relationship, and not merely

the legal form.

49



2.18 Revenue recognition

Real estate development business

Revenues from sales of real estate under

development are recognised upon signed

legally binding contracts of sale, using the

percentage of completion method. The

percentage of completion is calculated based

on actual costs incurred to total estimated

construction costs, excluding cost of land,

and results of assessment performed by

external construction managements.

The Group recognises income only when the

deposits and installments received are at

least twenty percent of the total sale contract

price and when the construction work is at

least ten percent complete. Revenue

recognition will be discontinued when more

than three consecutive installments are

overdue for payment.

Installment due under contract but not yet

received is shown as "Account receivable".

The excess of revenue recognised under the

percentage of completion method over the

amount of installment payment due under

contract is shown as "Unbilled completed

work" under current assets. The excess of

installment due under the contract over the

revenue recognised under the percentage of

completion method is shown as "Billing in

excess of work in progress" under current

liabilities.

Other revenues

Other revenues comprise the invoiced value

for the sale of goods and services net of

output tax, rebates and discounts. Revenue

from sales of goods is recognised when

significant risks and rewards of ownership of

the goods are transferred to the buyer.

Revenue from services is recognised as

revenue in the year/period in which the service

is rendered.

Interest income is recognised on an accrual

basis unless collectibility is in doubt.

2.19 Foreign currency translation

Foreign currency transactions of the Group

are accounted for at the exchange rates

prevailing at the date of the transactions

and monetary assets and liabilities

denominated in foreign currencies at the

balance sheet date are translated into Thai

Baht at the exchange rates ruling at the

balance sheet date, except where they are

covered by financial instruments. The

Company translates foreign currency loans

and interest payable into Thai Baht

according to the exchange rate, as specified

in the cross currency interest rate swap

option contract. Any differences to be paid

or received on the cross currency swap

option contract, and gains and losses

resulting from the settlement of such

transactions and from the translation of

monetary assets and liabilities denominated

in foreign currencies are recongnised in the

statement of income.

2.20 Borrowings

Borrowings are recognised initially at the

proceeds received, net of transaction costs

incurred. In subsequent periods, borrowings

are stated at amortised cost using the

effective yield method. Any difference

between proceeds (net transaction costs)

and the redemption value is recognised in

the statement of income over the period of

the borrowings.

2.21 Provisions

Provisions, which exclude the provisions

relating to employee benefits, are recognised

when the Group has a present legal or

constructive obligation as a result of past

events, it is probable that an outflow of

resources embodying economic benefits will

be required to settle the obligation, and a

reliable estimate of the amount of the

obligation can be made.

2.22 Provident fund

The Company operates a provident fund, the

assets of which are held in a separate trust

fund. The provident fund is funded by

payments from employees and by the

Company. Contributions to the provident

fund are charged to the statement of income

in the year to which they relate.

50



3 Cash and cash equivalents


2005 2004 2005 2004

Baht Baht Baht Baht

Cash on hand 40,714,366 1,536,417 33,517,839 1,536,417

Deposits on call, fixed deposits and

promissory notes with maturity periods

within 3 months 430,145,173 576,684,011 402,848,513 558,487,582

Total cash and cash equivalents 470,859,539 578,220,428 436,366,352 560,023,999

5 Unbilled completed work and trade accounts receivable


2005 2004 2005 2004

Baht Baht Baht Baht

Total value of contracts signed 4,903,448,124 4,697,096,080 4,756,442,996 4,693,899,699

Percentage of total projects 57.22 50.46 62.06 50.44

Unbilled completed work

Revenues recognised to date 4,253,160,624 3,538,959,334 4,106,155,496 3,535,762,954

Less: Installments due (3,630,861,473) (3,387,552,086) (3,483,856,345) (3,384,355,706)

Add: Billing in excess of work in progress - 1,668,493 - 1,668,493

Unbilled completed work 622,299,151 153,075,741 622,299,151 153,075,741

Fixed deposits at banks and promissory notes with maturity periods within 3 months of local

financial institutions carry interest at the rates of 1.50% - 3.75% per annum (2004 : 0.25% -

1.875% per annum).

As at 31 December 2005, unbilled completed work, which are presented in the company financial

statements amounting to Baht 622 million (2004 : Baht 142 million), are being used as collateral of

long-term borrowings of the Company from local banks amounting to Baht 283 million (2004 : Baht

188 million) (Note 15).

As at 31 December 2005, short-term investments, which are presented in the consolidated and

company financial statements with a net book value of Baht 23.84 million (2004 : Baht 53.15 million)

and Baht 12.84 million (2004 : Baht 53.15 million), respectively, are fixed deposits at banks,

which are pledged with the banks for letters of guarantee issued by the banks to the Land

Allotment Supervision Board and for letter of credit issued by the bank to the suppliers for

imported purchasings (2004 : pledged to the Land Allotment Supervision Board) (Note 26).

4 Short-term investments

51



2005 2004 2005 2004

Baht Baht Baht Baht

Trade accounts receivable

Installments due 3,630,861,473 3,387,552,086 3,483,856,345 3,384,355,706

Less: Collections (3,629,125,250) (3,384,981,603) (3,482,120,122) (3,381,785,223)

Trade accounts receivable

- installments due 1,736,223 2,570,483 1,736,223 2,570,483

Less: Short-term trade accounts

receivable (808,503) (1,642,763) (808,503) (1,642,763)

Long-term trade accounts

receivable 927,720 927,720 927,720 927,720

Less: Allowance for doubtful

accounts (247,720) (247,720) (247,720) (247,720)

Long-term trade accounts

receivable, net 680,000 680,000 680,000 680,000

Consolidated and Company

2005 2004

Baht Baht

Within 3 months 405,022 613,844

3 - 6 months 141,200 411,902

6 - 12 months - 617,017

Over 12 months 262,281 -

Total short-term trade accounts receivable 808,503 1,642,763

Long-term trade accounts receivable as at 31 December 2005 included 10 troubled debtors

(2004 : 10 debtors), which the Company partly provides an allowance for doubtful debts. All

long-term accounts receivable have been outstanding for more than 12 months.

The figures disclosed in this note do not include projects where 90% of the respective project

has been sold and ownership transferred to customers.

Outstanding short-term trade accounts receivable as at 31 December can be aged as follows:

52

5 Unbilled completed work and trade accounts receivable (Continued)



2005 2004

Baht Baht

Beginning balance 86,055,029 82,499,020

Additional loans 1,500,000 8,300,000

Increase in interest receivable (Note 20) 5,819,174 4,756,009

Loan repayments received - (9,500,000)

Ending balance 93,374,203 86,055,029

7 Inventories, net


2005 2004 2005 2004

Baht Baht Baht Baht

Condominium units for sale 27,331,000 27,331,000 27,331,000 27,331,000

Condominium units bought for sale 6,048,100 6,048,100 6,048,100 6,048,100

Houses for sale 68,729,540 11,756,655 68,729,540 11,756,655

Land for sale 125,551,970 11,356,162 125,551,970 11,356,162

Supplies for construction 3,969,939 1,420,864 2,549,075 -

Retail products 22,689,935 - - -

254,320,484 57,912,781 230,209,685 56,491,917

Less: Allowance for obsolescence (1,420,864) (1,420,864) - -

Allowance for impairment (57,000,000) - (57,000,000) -

Inventories, net 195,899,620 56,491,917 173,209,685 56,491,917

6 Long-term loans to and amounts due from other company

As at 31 December 2005 and 2004, long-term loans to and amounts due from other company

represent unsecured loans in form of promissory notes at call to Bang Plee View Company

Limited, which used to be an associate, and interest receivable for the loans. However, the

Company will not call the loans and interest receivable outstanding as at 31 December 2005 for

settlement within 2006. Therefore, the Company presents the loans and interest receivable as

long-term loans to and amounts due from other company.

The movements of the loans to and amounts due from other company during the years are as

follows:

As at 31 December 2005, land of the Company with a net book value of Baht 12.56 million is

used to secure against short-term borrowings from a financial institution, is in the process of

being released from the mortgage. In addition, land of the Company with a net book value of

Baht 8.82 million is secured as a collateral with the court (2004 : all inventories were free-hold).

53


8 Real estate development cost


2005 2004 2005 2004

Baht Baht Baht Baht

Land development 2,381,121,835 2,472,536,222 1,566,064,187 1,656,652,575

Construction in progress 3,491,761,129 3,281,965,776 3,139,565,397 3,066,593,443

Capitalised interest 151,659,313 111,759,577 91,975,894 76,945,405

Mocks up and project offices 131,094,399 208,988,567 116,855,021 202,421,315

Other related costs 20,524,944 18,116,559 15,229,411 14,399,271

Total 6,176,161,620 6,093,366,701 4,929,689,910 5,017,012,009

Less: Transfer to cost of sales (2,550,429,917) (2,249,736,350) (2,452,614,284) (2,249,736,351)

Transfer to property and

equipment (Note 12) (200,243,408) - (200,243,408) -

Real estate development cost 3,425,488,295 3,843,630,351 2,276,832,218 2,767,275,658

Capitalised interest during the year 57,463,052 65,252,668 32,593,805 30,438,496

9 Other current assets


2005 2004 2005 2004

Baht Baht Baht Baht

Advances to contractors 35,537,233 129,226,450 34,121,346 125,104,965

Land deposit 140,000,000 140,000,000 140,000,000 140,000,000

Accrued management fees

ë related companies (Note 25) - - 4,585,076 4,585,076

ë other companies 6,697,128 6,697,128 6,697,128 6,697,128

Accrued rental and service income

ë related companies (Note 25) - - 23,630,000 124,000

Share subscription receivable (Note 10) - - - 17,000,000

Others 31,697,683 17,662,820 17,160,003 5,002,413

Total other current assets 213,932,044 293,586,398 226,193,553 298,513,582

As at 31 December 2005, real estate development costs, which are presented in the

consolidated and company financial statements with a net book value of Baht 879 million (2004

: Baht 818 million) and Baht 228 million (2004 : Baht 177 million), respectively, are being used

as collaterals of long-term borrowings of the Company and its subsidiary from local banks

amounting to Baht 653 million (2004 : Baht 558 million) and Baht 283 million (2004 : Baht 188

million), respectively, (Note 15).

The real estate development costs as at 31 December 2005 and 2004 do not include projects

where 90% of the respective project has been sold and ownership transferred to customers.

54


Investments in subsidiaries - equity method

2005 2004

Baht Baht

Beginning balance 305,186,157 (85,814,574)

Share of losses in subsidiaries, net (Note 20) (41,028,365) (13,249,269)

Additional investments 17,000,000 404,250,000

Ending balance 281,157,792 305,186,157

Company

10 Investments in and short-term loans to and amounts due from

subsidiaries, associate and other investment

Company

Paid-up

share capital Percentage of holding

Principal 2005 2004 2005 2004

activities Million Baht Million Baht Percent Percent

Investments in subsidiaries

Continental City Company Limited Real estate 440.0 440.0 100.0 100.0

Ban Suk Sabai Company Limited Real estate 2.0 2.0 100.0 100.0

S&P Property Management Management

Company Limited service 2.0 2.0 100.0 100.0

Research & Consultant Company Construction

Limited service 10.0 10.0 65.0 65.0

Playground Store Company Limited Retail

business, 25.0 5.0 85.0 85.0

Rental and

services


Paid-up

share capital Percentage of holding

Principal 2005 2004 2005 2004

activities Million Baht Million Baht Percent Percent

Investment in associate

N.K. Energy Conservation Light weight

Company Limited wall panel 6.5 6.5 50.0 50.0

Other investment

Khonkaenland Development

Group Company Limited Real estate 265.0 265.0 1.9 1.9

On 18 May 2004, the Company increased an investment in common shares of Continental City

Company Limited totalling Baht 400 million, consisting of 4 million shares with a par value of Baht

100 per share.

On 18 August 2004, the Company acquired ordinary shares of Playground Store Company Limited at

85% of its registered capital or 42,500 shares at the par value of Baht 100, totalling Baht 4.25

million.

On 16 December 2004, the Board of Directors approved the Company to increase the investment in

ordinary shares of Playground Store Company Limited at 85% of the increase in its registered

capital or 170,000 shares at the par value of Baht 100, totalling Baht 17 million. The Company

recorded the cash payment as a share subscription receivable (Note 9) as at 31 December 2004

since Playground Store Company Limited registered the increase of share capital with the Ministry of

Commerce on 19 January 2005.

55


Company - 2005 (Baht)

Short-term Short-term

loans to and loans to and

Average amounts Less: Investment amounts Liabilities arisen

Investments Interest due from value using due from Investments in from investments

at cost Rates (%) subsidiaries equity method subsidiaries, net subsidiaries, net in subsidiaries, net

Ban Suk Sabai Company Limited 1,360,000 5.12 565,712,252 (55,370,620) 510,341,632 - -

Continental City Company Limited 442,783,506 - - 392,066,811 - 392,066,811 -

Research & Consultant Company

Limited 6,500,000 7.05 4,898,038 (5,909,426) - - (1,011,388)

S&P Property Management

Company Limited 5,000 - - (14,339,158) - - (14,339,158)

Playground Store Company Limited 21,250,000 6.00 92,965,491 (35,289,815) 57,675,676 - -

471,898,506 663,575,781 281,157,792 568,017,308 392,066,811 (15,350,546)

Company - 2004 (Baht)

Short-term Short-term

loans to and loans to and

Average amounts Less: Investment amounts Liabilities arisen

Investments Interest due from value using due from Investments in from investments

at cost Rates (%) subsidiaries equity method subsidiaries, net subsidiaries, net in subsidiaries, net

Ban Suk Sabai Company Limited 1,360,000 4.85 490,935,649 (70,283,930) 420,651,719 - -

Continental City Company Limited 442,783,506 - - 392,989,696 - 392,989,696 -

Research & Consultant Company

Limited 6,500,000 5.34 4,603,949 (4,964,496) - - (360,547)

S&P Property Management

Company Limited 5,000 - - (13,567,551) - - (13,567,551)

Playground Store Company Limited 4,250,000 - - 1,012,438 - 1,012,438 -

454,898,506 495,539,598 305,186,157 420,651,719 394,002,134 (13,928,098)

Short-term loans to subsidiaries are unsecured loans denominated in Thai Baht and repayable on demand.

Amounts due from subsidiaries represent interest receivables for the loans to subsidiaries.

Since the investments in subsidiaries under equity method are below zero, the Company presents the negative investment balance against the short-

term loans to and amounts due from subsidiaries.

10 Investments in and short-term loans to and amounts due from subsidiaries, associate and other investment (Continued)

Investments in and short-term loans to and amounts due from subsidiaries

56



2005 2004

Baht Baht

Investment in associate

N.K. Energy Conservation Company Limited 3,247,400 3,247,400

Less: Allowance for impairment (3,247,400) (3,247,400)

Investment, net - -

Other investment

Khonkaenland Development Group Company Limited 5,000,000 5,000,000

Less: Allowance for impairment (5,000,000) (5,000,000)

Investment, net - -


2005 2004

Baht Baht

Land cost - 113,032,026

Capitalised interest - 590,459

Other expenses - 573,323

Total - 114,195,808

Less: Allowance for impairment - (57,000,000)

Land held for future development, net - 57,195,808


2005 2004

Baht Baht

Opening net book value 57,195,808 57,195,808

Less: Transfer to inventories (Note 7) (57,195,808) -

Ending net book value - 57,195,808

11 Land held for future development, net

10 Investments in and short-term loans to and amounts due from

subsidiaries, associate and other investment (Continued)

As at 31 December 2004, land held for future development of the Company with a net book value

of Baht 12.56 million, which was secured against short-term borrowings from a financial

institution, is in the process of being released from the mortgage.

Movements in land held for future development, net, for the year ended 31 December are analysed as

follows:

As at 31 December 2005, land held for future development was transferred to inventories, as the Company no longer has the intention to hold the land for future development.

57


Consolidated (Baht)

Furniture

and fixtures,

office Building Furniture

Building equipment Building improvements and fixtures

Land Clubhouses improvements and vehicles for lease for lease for lease Total

Year ended

31 December 2004

Opening net book value 12,792,000 10,553,775 - 14,388,173 - - - 37,733,948

Additions - 489,302 - 13,610,031 - - - 14,099,333

Disposals - - - (18,370) - - - (18,370)

Depreciation charge

(Note 22) - (777,788) - (4,704,035) - - - (5,481,823)

Closing net book value 12,792,000 10,265,289 - 23,275,799 - - - 46,333,088

At 31 December 2004

Cost 26,532,000 106,519,095 3,087,016 79,133,145 - - - 215,271,256

Less: Allowance

for impairment

of assets (13,740,000) (53,258,447) - - - - - (66,998,447)

Accumulated

depreciation - (42,995,359) (3,087,016) (55,857,346) - - - (101,939,721)

Net book value 12,792,000 10,265,289 - 23,275,799 - - - 46,333,088

Year ended

31 December 2005

Opening net book value 12,792,000 10,265,289 - 23,275,799 - - - 46,333,088

Additions - 85,880 - 53,372,104 - - - 53,457,984

Disposals - - - (32,168) - - - (32,168)

Transfer from real estate

development cost

(Note 8) 83,022,979 - - - 81,384,375 31,520,619 4,315,435 200,243,408

Depreciation charge

(Note 22) - (1,057,331) - (14,539,670) (4,069,219) (3,152,062) (863,087) (23,681,369)

Closing net book value 95,814,979 9,293,838 - 62,076,065 77,315,156 28,368,557 3,452,348 276,320,943

At 31 December 2005

Cost 109,554,979 106,604,975 3,087,016 132,463,309 81,384,375 31,520,619 4,315,435 468,930,708

Less: Allowance

for impairment

of assets (13,740,000) (53,258,447) - - - - - (66,998,447)

Accumulated

depreciation - (44,052,690) (3,087,016) (70,387,244) (4,069,219) (3,152,062) (863,087) (125,611,318)

Net book value 95,814,979 9,293,838 - 62,076,065 77,315,156 28,368,557 3,452,348 276,320,943

12 Property and equipment, net

As at 31 December 2005 and 2004, all property and equipment of the Group are free-hold.

58


Company (Baht)

Furniture

and fixtures,

office Building Furniture

Year ended equipment Building improvements and fixtures

31 December 2004 Land Clubhouses and vehicles for lease for lease for lease Total

Opening net book value 12,792,000 10,553,776 14,368,003 - - - 37,713,779

Additions - 489,302 6,465,760 - - - 6,955,062

Disposals - - (18,370) - - - (18,370)

Depreciation charge

(Note 22) - (777,788) (4,572,788) - - - (5,350,576)

Closing net book value 12,792,000 10,265,290 16,242,605 - - - 39,299,895

At 31 December 2004

Cost 26,532,000 101,194,231 67,746,197 - - - 195,472,428

Less: Allowance

for impairment

of assets (13,740,000) (49,531,042) - - - - (63,271,042)

Accumulated

depreciation - (41,397,899) (51,503,592) - - - (92,901,491)

Net book value 12,792,000 10,265,290 16,242,605 - - - 39,299,895

Year ended

31 December 2005

Opening net book value 12,792,000 10,265,290 16,242,605 - - - 39,299,895

Additions - 85,880 3,879,697 - - - 3,965,577

Disposals - - (1,361) - - - (1,361)

Transfer from real estate

development cost

(Note 8) 83,022,979 - - 81,384,375 31,520,619 4,315,435 200,243,408

Depreciation charge

(Note 22) - (1,057,331) (5,752,197) (4,069,219) (3,152,062) (863,087) (14,893,896)

Closing net book value 95,814,979 9,293,839 14,368,744 77,315,156 28,368,557 3,452,348 228,613,623

At 31 December 2005

Cost 109,554,979 101,280,111 71,621,663 81,384,375 31,520,619 4,315,435 399,677,182

Less: Allowance

for impairment

of assets (13,740,000) (49,531,042) - - - - (63,271,042)

Accumulated

depreciation - (42,455,230) (57,252,919) (4,069,219) (3,152,062) (863,087) (107,792,517)

Net book value 95,814,979 9,293,839 14,368,744 77,315,156 28,368,557 3,452,348 228,613,623

As at 31 December 2005 and 2004, all property and equipment of the Company are free-hold.

Building, building improvements and furniture and fixtures of the Company with net book values

as at 31 December 2005 amounting to approximately Baht 109 million are under a three-year

operating lease agreement with a subsidiary, commencing 15 March 2005. The subsidiary has an

option to renew this operating lease agreement for another three-year period.

59



2005 2004 2005 2004

Baht Baht Baht Baht

Withholding tax receivable 1,733,895 28,285,575 253 28,159,353

Deposit for investment 4,000,000 4,000,000 4,000,000 4,000,000

Others 13,570,175 11,469,109 12,385,217 10,902,310

Total other assets 19,304,070 43,754,684 16,385,470 43,061,663

13 Other assets


2005 2004 2005 2004

Baht Baht Baht Baht

Accrued interest expenses 7,793,873 7,489,210 7,702,640 7,451,196

Accrued expenses 55,268,231 38,550,906 51,405,148 32,075,888

Account payable for land 15,500,000 15,500,000 15,500,000 15,500,000

Loans from other company 13,085,701 12,628,655 - -

Accrued corporate income tax 11,901,088 9,609,332 11,901,088 9,609,332

Others 26,970,436 34,022,061 20,342,152 27,963,871

Total other current liabilities 130,519,329 117,800,164 106,851,028 92,600,287

14 Other current Liabilities


2005 2004 2005 2004

Baht Baht Baht Baht

Current borrowings

Promissory notes issued to financial

institutions 367,498,381 633,701,452 367,498,381 633,701,452

Debentures - current portion of

long-term borrowings 1,000,000,000 - 1,000,000,000 -

Total current borrowings 1,367,498,381 633,701,452 1,367,498,381 633,701,452

Non-current borrowings

Debentures - 1,000,000,000 - 1,000,000,000

Borrowings from financial institutions 653,149,000 557,600,000 283,149,000 187,600,000

Total non-current borrowings 653,149,000 1,557,600,000 283,149,000 1,187,600,000

Total borrowings 2,020,647,381 2,191,301,452 1,650,647,381 1,821,301,452

15 Borrowings

Deposit for investment of Baht 4 million (2004 : Baht 4 million) is a deposit in a fund to jointly bid in loan portfolios from the Financial Restructuring Authority Sector. The Company has a right to invest at 10% of the bid price or the minimum amount of Baht 37.5 million. At present, the restructuring process has not yet been completed.

60



2005 2004 2005 2004

Baht Baht Baht Baht

Beginning balance 1,557,600,000 1,000,000,000 1,187,600,000 1,000,000,000

Additional borrowings 470,400,000 557,600,000 470,400,000 187,600,000

Loan repayments paid (374,851,000) - (374,851,000) -

Transfer to current borrowings (1,000,000,000) - (1,000,000,000) -

Closing net book value 653,149,000 1,557,600,000 283,149,000 1,187,600,000

The movements in the long-term borrowings for the year ended 31 December can be analysed

as follows:

The current borrowings of the Company consist as follow:

a) As at 31 December 2005 and 2004, the Company's current borrowings representing bills of

exchange due within one year were issued to institutional investors with interest rate at 4.25%

per annum (2004 : 4.00% - 4.25% per annum).

b) As at 31 December 2005 and 2004, unsubordinated and unsecured debentures, without a

debenture holder's representative in the name-registered certificate, amount to one million units

at the face value of Baht 1,000 per unit, totalling Baht 1,000 million. The debentures have

maturity period of 3 years and carry interest rate at 4% per annum, and the interest is payable

semi-annually. The debentures will be due for redemption on 3 November 2006.

The non-current borrowings of the Group and the Company consist as follows:

a) As at 31 December 2005 and 2004, long-term borrowing from a financial institution of the

Company represents a loan from a local bank amounting to Baht 158.1 million (2004 : Baht

187.6 million), and carries interest at MLR minus 2.75% per annum, but not lower than an

interest rate for personal fixed deposit of a 12-month period plus 2.25% per annum and will be

due for repayment on 26 February 2007. The Company has pledged the ownership certificate of

the condominium units of the related project, including respective unbilled completed work and

real estate development cost, as collaterals for the loan (Notes 5 and 8).

b) As at 31 December 2005, long-term borrowing from a financial institution of the Company

represents a loan from a local bank amounting to Baht 125 million (2004 : nil), which carries

interest at an interest rate for personal fixed deposit of a 12-month period plus 3.25% per annum

and will be due for repayment on 14 February 2008. The Company has pledged its land of the

related project, including relevant unbilled completed work and real estate development cost, as

collaterals for the loan (Notes 5 and 8).

c) As at 31 December 2005 and 2004, long-term borrowing from a financial institution of a

subsidiary represents a loan from a local bank amounting to Baht 370 million (2004 : Baht 370

million), which carries interest at MLR minus 2% per annum and will be due for repayment on

20 May 2008. The subsidiary has pledged land of the related project, including related real

estate development cost, as collaterals for the loan (Note 8).

61

15 Borrowings (Continued)



2005 2004 2005 2004

Million Baht Million Baht Million Baht Million Baht

Unused credit lines

Floating interest rate 1,012 1,202 212 402

As at 31 December, the followings are undrawn borrowing facilities:

16 Minority interest

17 Deferred income taxes

Consolidated

2005 2004

Baht Baht

Beginning balance 178,665 -

Acquisition of investment in subsidiary (Note 10) 3,000,000 750,000

Share of net loss of subsidiary (Notes 20 and 28) (9,406,279) (571,335)

Ending balance (6,227,614) 178,665


2005 2004

Baht Baht

Statements of income (Note 21) 65,700,934 143,624,399

Less: Valuation allowance (46,354,701) (70,427,366)

Deferred income tax assets, net 19,346,233 73,197,033

Deferred income tax liability 68,041,369 38,268,935

Deferred income taxes are calculated on all temporary differences under the liability method

using a principal tax rate of 25%.

15 Borrowings (Continued)

62


The movements in the deferred income tax account for the year ended 31 December are as

follows:


2005 2004

Baht Baht

Deferred income tax assets, net

Beginning balance 73,197,033 -

Statements of income (Note 21) (77,923,465) 143,624,399

Less: Valuation allowance 24,072,665 (70,427,366)

Ending balance 19,346,233 73,197,033

Deferred income tax liability

Beginning balance 38,268,935 -

Statements of income (Note 21) 29,772,434 38,268,935

Ending balance 68,041,369 38,268,935


2005 2004

Baht Baht

Deferred income tax assets, net

Allowances for doubtful loans and long-term

accounts receivable 23,578,034 102,505,405

Allowance for impairment in value of land 28,043,129 28,043,129

Deposits and advances received from

customers 7,400,767 7,839,273

Allowance for impairment in value

of investment 2,061,850 2,061,850

Others 4,617,154 3,174,742

Total deferred income tax assets 65,700,934 143,624,399

Less: Valuation allowance (46,354,701) (70,427,366)

Deferred income tax assets, net 19,346,233 73,197,033

Deferred income tax liability

Unbilled completed work 68,041,369 38,268,935

17 Deferred income taxes (Continued)

Deferred income tax assets and liability as at 31 December are derived from the following

temporary differences:

Deferred income taxes are calculated on all temporary differences arising from differences

between tax base of assets and liabilities and their carrying amounts by using a principal tax rate

of 25%. However, deferred tax assets are recognised to the extent that it is probable that

future taxable profit will be available against which the temporary differences can be utilised.

63


Consolidated and Company (Baht)

Number of Ordinary Share Shares

shares share premium discount Total

For the year ended

31 December 2005

Registered share capital

At 31 December 2005

(par value of Baht 5 per share) 474,782,565 2,373,912,825 - - 2,373,912,825

Issued and paid-up

At 31 December 2003 456,471,175 2,282,355,875 781,292,711 (1,625,060,721) 1,438,587,865

Decrease during the year - - - - -

Issue of shares during the year - - - - -

At 31 December 2004 456,471,175 2,282,355,875 781,292,711 (1,625,060,721) 1,438,587,865

At 31 December 2004 456,471,175 2,282,355,875 781,292,711 (1,625,060,721) 1,438,587,865

Transfer of share premium to

offset against share discount - - (781,292,711) 781,292,711 -

Decrease during the year - - - - -

Issue of shares during the year - - - - -

At 31 December 2005 456,471,175 2,282,355,875 - (843,768,010) 1,438,587,865

18 Share capital, premium and discount on share capital, and dividend

At the annual general meeting of the Company's shareholders held on 28 April 2005, the

shareholders approved to pay dividend in respect of the year 2004 of Baht 0.19 per share

amounting to a total of Baht 87 million.

At the annual general meeting of the Company's shareholders held on 29 April 2004, the

shareholders approved to pay dividend in respect of the year 2003 of Baht 0.42 per share

amounting to a total of Baht 191.7 million.

According to the Circular Letter No. SEC.Chor.Sor. (Vor) 3/2549 of the Office of the Securities

and Exchange Commission, dated 8 February 2006, relating to the removal of share discount,

the management had considered the matter and would bring it to the Board of Directors'

meeting in March 2006 to seek solutions to remove the balance of share discount outstanding

as at 31 December 2005 amounting to Baht 844 million in full within 2007.

64


2005 2004 2005 2004


Net profit for the year 456,434,475 334,608,059 456,434,475 334,608,059

Interest expenses 38,491,963 5,158,558 52,825,526 33,836,698

Income tax 112,554,188 (11,641,721) 112,554,188 (11,641,721)

Profit before interest expenses

and income tax 607,480,626 328,124,896 621,814,189 356,803,036

Adjustments:

Depreciation and amortisation 25,338,553 9,274,540 16,551,080 8,991,653

Gains on cancelled contracts 22 (2,382,054) (2,807,016) (2,182,054) (2,807,016)

Losses on disposals of property

and equipment 32,168 14,570 1,361 14,570

Gain on foreign currency exchange 22 - (26,989,664) - (26,989,664)

Net loss of subsidiary attributable

to minority interest 16 (9,406,279) (571,335) - -

Share of losses of subsidiaries, net 10 - - 41,028,365 13,249,269

Changes in operating assets and

liabilities

ë trade accounts receivable (306,036) 45,535,560 834,260 45,535,560

ë unbilled completed work (469,223,410) (129,430,324) (469,223,410) (129,430,324)

ë amounts due from subsidiaries - - (29,804,182) (22,249,987)

ë amounts due from other company 6 (5,819,174) (4,756,009) (5,819,174) (4,756,009)

20 Cash flows from operating activities

Reconciliation of net profit for the year to cash flows from operating activities is as follows:

19 Legal reserve


2005 2004

Baht Baht

Beginning balance 67,348,943 50,618,540

Decrease during the year - -

Appropriation during the year 22,821,724 16,730,403

Ending balance 90,170,667 67,348,943

Under the Public Companies Act, the Company is required to set aside as a statutory reserve at

least 5 percent of its net profit after accumulated deficit brought forward (if any) until the reserve

is not less than 10 percent of the registered capital. The legal reserve is not distributable as a

dividend. During the year, the Company sets aside additional legal reserve amounting to

approximately Baht 23 million (2004 : 17 million).


65


21 Income tax


2005 2004

Baht Baht

Current income tax (28,930,954) (23,286,377)

Deferred income taxes (Note 17) (107,695,899) 105,355,464

Less: Valuation allowance (Note 17) 24,072,665 (70,427,366)

Income tax expense for the year (Note 28) (112,554,188) 11,641,721

Reconciliation of current year income tax


2005 2004 2005 2004


ë inventories (25,259,553) - (2,569,618) -

ë real estate development cost 454,559,358 (923,189,573) 501,991,495 (703,429,001)

ë other current assets 79,654,354 (2,541,560) 55,320,029 8,431,926

ë other assets (5,485,238) (2,902,092) (3,140,091) (2,437,617)

ë accounts payable - construction (156,724,872) (17,831,065) (149,806,112) (33,229,278)

ë trade accounts payable 14,543,142 - 422,559 -

ë deposits and advances received

from customers (548,318) (36,438,767) (817,088) (34,107,009)

ë retention payable (16,169,723) 37,488,082 (17,251,349) 34,998,846

ë other current liabilities 9,665,700 7,273,862 11,707,541 (3,832,383)

ë other liabilities 2,418,250 - (46,550) -


operating activities before interest

and income tax paid 502,367,494 (719,745,895) 569,011,251 (495,243,428)

Interest paid (95,193,306) (87,462,699) (81,524,347) (79,093,802)

Income tax paid (26,639,198) (13,677,044) (26,639,198) (13,677,044)

Proceeds from refunds of

withholding tax receivable 28,278,668 8,417,561 28,159,100 8,417,561


operating activities 408,813,658 (812,468,077) 489,006,806 (579,596,713)

20 Cash flows from operating activities (Continued)

66


23 Basic earnings per share


For the year ended 31 December

2005 2004

Net profit attributable to shareholders (Baht) 456,434,475 334,608,059

Weighted average number of paid-up ordinary shares in issue (shares) 456,471,175 456,471,175

Basic earnings per share (Baht) 1.00 0.73

Basic earnings per share is calculated by dividing the net profit for the year attributable to

shareholders by the weighted average number of paid-up ordinary shares in issue during the year.

22 Profit before interest expenses


2005 2004 2005 2004

Baht Baht Baht Baht

Employee costs 85,757,530 62,818,177 68,512,510 60,966,291

Depreciation on property and

equipment (Note 12) 23,681,369 5,481,823 14,893,896 5,350,576

Selling and marketing expenses 49,449,550 145,083,800 23,985,929 145,083,800

Project management expenses 34,402,574 58,385,535 33,262,574 53,613,526

Gain on foreign currency exchange (Note 20) - (26,989,664) - (26,989,664)

Gains on cancelled contracts (2,382,054) (2,807,016) (2,182,054) (2,807,016)

The following expenditures , classified by nature, have been charged in arriving at profits before

interest expenses.

In 2005, the Company and the Group cancelled certain sales contracts and forfeited the deposits

from those contracts amounting to Baht 2.18 million (2004 : Baht 2.81 million) and Baht 2.38 million

(2004 : Baht 2.81 million), respectively, (Note 20).

67


Foreign currency Baht

Within 1 year US$ 16.35 million 693,240,000

The net unrecognised gains at 31 December

2003 on open contracts for hedging foreign

currency repayment amounted to Bahts 10.2

million. The gains of Baht 27 million were

fully recognised in the statement of income

in March 2004.

Credit risk

Credit risk is the risk that one party to a

financial instrument will fail to discharge an

obligation and cause the Company to incur

a financial loss.

The Group has no significant concentrations

of credit risk. Cash is placed with reputable

financial institutions. Concentrations of credit

risk with respect to trade accounts receivable

are limited due to the Group's large number of

customers in a variety of businesses. Due to

these factors, management believes that no

additional credit risk beyond the amounts

provided for collection losses is inherent in the

Group's trade accounts receivable.

24 Financial instruments

A financial instrument is any contract that

gives rise to both a financial asset of one entity

and a financial liability or equity instrument of

another entity.

Risks relating to significant financial instruments

held by the Group are summarised as follows:

Foreign exchange risk

Foreign exchange risk is the risk that the

value of a financial instrument will fluctuate

due to changes in market foreign exchange

rate.

The Group has no significant exposure to

foreign exchange risk. The Group purchases

some retail products in foreign currencies.

However, the Group considers that it is not

necessary to use derivative financial instruments

to hedge such risk since management believes

that future movements in market foreign

exchange will not materially affect the Group's

operating results.

Cross currency interest rate swap option contract

The Company entered into a cross currency

interest rate swap option contract to alter

the interest rate and currency characteristic

for long-term borrowings from other

company into Thai Baht currency. Under

the cross currency interest rate swap option,

the Company agreed with a foreign bank to

exchange the fixed rate at 6% per annum

on US Dollar notional 16,350,000 to the

bank's deposit rate plus 4% per annum on

Thai Baht notional 693,240,000.

The remaining term and notional principal

amount of the outstanding cross currency

interest rate swap contract at 31 December

2003 were:

68


25 Related party transactions

Average interest rates Company

2005 2004 2005 2004

% % Baht Baht

Subsidiaries

Ban Suk Sabai Company Limited 5.12 4.85 30,673,031 22,934,934

Playground Store Limited 6.00 - 3,065,490 -

Continental City Company Limited - 4.00 - 9,551,307

Research and Consultant Company Limited 7.05 5.34 193,520 180,636

Total 33,932,041 32,666,877

a) Interest income

Interest rate risk

Interest rate risk is the risk that the value of

a financial instrument will fluctuate due to

changes in market interest rates.

The Group borrowed by issuance of debentures

with fixed interest rate for operation and for

project development to reduce the uncertainty

of future cash flows which may incur from

changes in interest rates. Therefore, the

interest rate risk for the Group is reduced.

Liquidity risk

Liquidity risk, or funding risk, is the risk that

the Group will encounter difficulty in raising

funds to meet commitments associated with

financial instruments. Liquidity risk may

result from an inability to sell a financial

asset quickly at close to its fair value.

The Group's financial assets mainly comprise

cash and deposits at financial institutions,

loans to and amounts due from other

company and unbilled completed work. The

ability to raise funds to be able to settle the

contractual liabilities depends on the ability

of the other company to repay the debts

and the ability of collection of unbilled

customers where the sale contracts were

signed.

Fair values

The carrying amounts at the balance sheet

date of cash and deposits at financial

institutions, trade accounts receivable, loans,

unbilled completed work and other financial

liabilities approximate to their fair values.

The majority of the Company's shares are widely held by public through the Stock Exchange of

Thailand.

The following significant transactions incurred during the years 2005 and 2004 are carried out with

related parties:

69


The selling price is at market value.

b) Sale of real estate development project

Company

2005 2004

Baht Baht

Subsidiary

Ban Suk Sabai Company Limited - 826,000

c) Revenues from rental and services

Company

2005 2004

Baht Baht

Subsidiary

Playground Store Limited

ë Revenues from rental 9,757,003 -

ë Revenues from services 12,849,530 -

22,606,533 -

d) Purchase of goods

Company

2005 2004

Baht Baht

Subsidiary

Playground Store Limited 422,559 -

e) Interest expense

Company

2005 2004

Baht Baht

Subsidiary

Continental City Company Limited 4,318,417 2,851,682

70

25 Related party transactions (Continued)


f) Account payable - construction

Company

2005 2004

Baht Baht

Subsidiar

Research & Consultant Company Limited 185,991 185,991

g) Account payable

Company

2005 2004

Baht Baht

Subsidiary

Playground Store Limited 422,559 -

h) Accrued management fees

Company

2005 2004

Baht Baht

Subsidiaries

Ban Suk Sabai Company Limited 2,310,962 2,310,962

S & P Property Management Company Limited 2,274,114 2,274,114

Total 4,585,076 4,585,076

i) Accrued rental and service income

Company

2005 2004

Baht Baht

Subsidiaries

Playground Store Limited 23,506,000 -

Research and Consultant Company Limited 124,000 124,000

Total 23,630,000 124,000

71



j) Amount due to and loans from subsidiary

The Group and the Company have commitments and contingent liabilities as follows:

26 Commitments and contingent liabilities

Company

2005 2004

Baht Baht

Subsidiary

Continental City Company Limited 109,219,052 121,325,511


2005 2004 2005 2004

Million Baht Million Baht Million Baht Million Baht

Capital commitments

Commitments under contracts to

invest in development projects

until completion 276 1,371 263 1,290

Commitments under land purchase

contracts 110 136 110 136

Commitments under service contracts 17 52 17 52

Commitments under office rental

agreements 10 15 8 15

Total capital commitments 413 1,574 398 1,493

Contingent liabilities in respect of

bank guarantees (Note 4) 24 53 13 53

Contingent liabilities in respect of

guarantees 10 - 10 -

As at 31 December 2005 and 2004, loans from a subsidiary carry interest at MLR minus 2% per

annum and are repayable on demand.

Contingent liabilities in respect of guarantees amounting to Baht 10 million (2004 : nil) are

contingent liabilities in respect of guarantees with a financial institution for letters of guarantees

issued by the financial institution to the Land Allotment Supervision Board.


72


Financial information by business segments

28 Segment information

For the year ended 31 December 2005

Construction Retail

Sales - real estate services - real business,

development estate development Rental and

business business services Consolidated

Baht'000 Baht'000 Baht'000 Baht'000

Revenues 2,457,775 106 48,016 2,505,897

Segment results 971,615 106 22,298 994,019

Interest income 15,945

Other income 6,200

Unallocated costs (418,090)

Operating profit 598,074

Interest expenses (38,492)

Income tax (Note 21) (112,554)

Profit before minority interest 447,028


to minority interest (Note 16) 9,406

Net profit for the year 456,434

For the year ended 31 December 2004

Construction Retail

Sales - real estate services - real business,

development estate development Rental and

business business services Consolidated

Baht'000 Baht'000 Baht'000 Baht'000

Revenues 1,719,367 50,854 - 1,770,221

Segment results 692,907 12,045 - 704,952

Interest income 12,757

Other income 34,417

Unallocated costs (424,572)

Operating profit 327,554

Interest expenses (5,159)

Income tax (Note 21) 11,642

Profit before minority interest 334,037


to minority interest (Note 16) 571

Net profit for the year 334,608

27 Provident fund

The Company established a contributory

registered provident fund on 1 October 1994

in accordance with the Provident Fund Act,

B.E. 2530, Ministerial Regulations, the Office

of the Securities and Exchange Commission's

notification and related amendments.

Under the provident fund, the Company

contributes 3% - 7% and employees can

choose to contribute 3% - 7% of their basic

salaries. The Company appointed an

authorised fund manager to manage the fund

in accordance with the terms and conditions

described in the Provident Fund Act,

Ministerial Regulation and related regulations.

During the year, the Company contributes

THB 1.9 million (2004 : THB 1.8 million).

73


Sales- real estate Consruction

development services - real estate Retail business,

business development business Rental and services Consolidated

2005 2004 2005 2004 2005 2004 2005 2004

Baht'000 Baht'000 Baht'000 Baht'000 Baht'000 Baht'000 Baht'000 Baht'000

Segment assets 5,241,924 5,182,567 4,256 5,538 97,764 25,715 5,343,944 5,213,820

Unallocated assets 19,346 73,197

Consolidated total assets 5,363,290 5,287,017

Segment liabilities 2,365,272 2,698,627 17,377 17,050 23,732 7,503 2,406,381 2,723,180

Unallocated liabilities 68,041 38,269

Consolidated total 2,474,422 2,761,449

liabilities

Capital expenditure 4,105 8,333 - - 49,353 5,766 53,458 14,099

Unallocated total capital

expenditure - -

Consolidated total capital

expenditure 53,458 14,099

Depreciation and

amortisation 16,902 9,005 3 161 8,434 109 25,339 9,275

Unallocated depreciation

and amortisation - -

Consolidated total

depreciation and

amortisation 25,339 9,275

The Group operates only in Thailand. Therefore, no geographical segmental information is presented as

secondary information.

28 Segment information (Continued)

74

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